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Notes to Accounts of GTL Infrastructure Ltd.

Mar 31, 2023

3 (a) (i) Buildings include properties having carrying value of '' 504 Lakhs (Previous year '' 514 Lakhs) for which deeds of conveyance have yet to be executed in favour of the Company and '' 0.07 Lakhs (Previous year '' 0.07 Lakhs) towards cost of 70 shares of '' 100 each in a Co-operative Housing Society

3 (a) (ii) Buildings includes Land related properties and Boundary Wall at Sites having carring value of '' 4,978 Lakhs (Previous year '' 5,154 Lakhs).

3 (a) (iii) Property, Plant and Equipment (PPE) includes assets mortgaged as security (Refer Note No. 18.2)

3 (a) (iv) The Company, in accordance with the Indian Accounting Standard (Ind AS 36) ''Impairment of Assets'', performed an impairment test based on current expectations of the impact of recent developments in telecom Sector on projected cash flows in tower business. The Carrying value of these assets exceeds its value in use and accordingly an impairment loss of Building '' 1,303 Lakhs and Plant & Equipments '' 57,351 lakhs has been recognized for the year ended March 31, 2023 and the same has been disclosed as exceptional item (previous year Building '' 609 Lakhs and Plant & Equipments '' 65,737 lakhs).

16.2 Terms/rights attached to equity shares

The Company has only one class of equity shares having par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all the preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

16.3 Shares reserved for issue under options :

The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 628,825,245 Equity Shares (Previous year 676,601,151). (Refer Note No. 22.1)

16.6 Out of total paid up capital, 94,843,348 equity shares allotted pursuant to compulsory conversion of Series A Bonds on maturity are not yet listed, since information regarding the Series A Bondholders are not available with the Company. In the absence of requisite information, the Company has allotted the said equity shares to a Trust, created for the benefit of Series A Bondholders.

Nature and purpose of Reserves

17.1 Equity Component of Compound Financial Instruments

Equity Component represents FCCB Series B1 & B3 Bonds compulsorily convertible into equity shares. (Refer Note No. 22.1)

17.2 Reconstruction Reserve

Created pursuant to scheme of arrangement approved by Hon''ble High Court in earlier years. It shall be utilised as per provisions of Companies Act 2013.

17.3 Capital Reserve

Created on Forfeiture of Preferential Convertible Warrants. It shall be utilised as per provisions of Companies Act 2013.

17.4 Securities premium

Created on conversion of Employee Stock Options Scheme , Preferential Warrants and Foreign currency convertible Bonds. It shall be utilised as per provisions of Companies Act 2013.

18.1 (a) I n 2018, post the unprecedented shutdown and exits of major customers like Aircel, RCom, Tata Tele etc., the Company

suffered a significant fall in revenue and EBITDA and there was an urgent need to right size the debt levels. At that time, the lenders of the Company chose to assign their respective debts in favour of Edelweiss Asset Reconstruction Company Limited (âEARCâ). As of March 31,2023, 79.34% of Indian Rupee Debt of '' 322,625 Lakhs have been assigned in favour of Edelweiss Asset Reconstruction Company (âEARCâ) acting in its capacity as Trustee of EARC Trust-SC 338 vide assignment agreement executed in favour of EARC. The Company believed that once the assignment was completed, the debt would be restructured to sustainable levels in a timely manner and accordingly, the Company presented multiple Resolution Plans starting from April 2018 for consideration of lenders'' consortium updating such plans from time to time after taking into account various developments in telecom sector. However, for reasons best known to them, the said Resolution Plans submitted by the Company were never considered by the lenders and also few lenders elected not to assign their respective debts to EARC.

(b) The Hon''ble National Company Law Tribunal, Mumbai Bench (âNCLTâ) vide its order dated November 18, 2022 (which was uploaded on its website on November 23, 2022) has dismissed petition filed by Canara Bank for initiation of Corporate Insolvency Resolution Process (âCIRPâ) under Section 7 of the Insolvency & Bankruptcy Code, 2016 (âIBCâ). The Hon''ble Tribunal held that the business of the Company is sustainable, it is a viable going concern under its current management and the overall financial health of the Company is not bad enough to be admitted under CIRP. Thus, in view of aforementioned, the petition is dismissed, against which Canara Bank has filed an appeal before National Company Law Appellate Tribunal, at Delhi (âNCLATâ). EARC who is the lead lender of the Company has also filed its intervention applicaiton in the said appeal, before NCLAT.

(c) IDBI Trusteeship Company Limited (ITSL) at the behest of lenders has, without the consent of and information to the Company, debited a total amount of '' 35,600 Lakhs, '' 28,000 Lakhs and '' 33,500 Lakhs from the TRA account during financial year 2020-21,2021-22 and 2022-23 respectively aggregating to '' 97,100 Lakhs as on March 31, 2023. In the absence of consent of and information to the Company about such debits, the Company has provided the interest on borrowings after adjusting this amount in principal.

(d) Meanwhile IDBI Trusteeship Company Limited (ITSL), Security Trustee, on the instruction of lenders of the Company has invoked pledge on 2,85,00,000 equity shares of GTL Limited, pledged by Global Holding Corporation Private Limited, promoter group company and transferred the said shares to their account. As on March 31,2023, recovery from sale of the 2,85,00,000 equity shares amounting to '' 3,401 Lakhs is reduced from the Lenders'' outstanding amount and considered as other equity towards contribution of promoter group company considering invocation of their pledged shares by the lenders.

(e) The Company received notices of recall of loans from EARC and IDBI Bank claiming alleged default of '' 382,261 Lakhs and '' 20,102 Lakhs respectively in terms of Master Restructuring Agreement dated December 31,2011 during financial year 2020-21. The Company has strongly refuted the claims and responded to said notices appropriately. Thus, in absence of directions from lenders as stated above, the Company continues to mention terms of repayment (Refer note No 18.3) and amount of Overdue (Refer note no. 18.4) as on March 31,2023 in terms of and in accordance with the payment schedule, terms and conditions of Strategic Debt Restructuring Scheme as approved by then lenders.

(f) As per the arrangements with the Lenders, the Company is required to comply with certain covenants and noncompliance with these covenants may give rights to the lenders to demand Repayment of the loans. Considering alleged claims of lenders and to comply with the requirement of IND AS -1 âPresentation of Financial Statementâ, the Company has classified Non-Current borrowings as Current Financial liability as an abundant precaution, which was classified for the first time in the Balance Sheet as at March 31,2019 .

18.2 (a) (i) Specific Charge - Banks, Financial Institutions and Asset Reconstruction Trust of the erstwhile standalone

Company and erstwhile CNIL continue to have specfic charge on the assets or properties of respective companies as existed on the effective date of merger i.e December 22, 2017.

(ii) Personal guarantee of Mr. Manoj Tirodkar (Promoter) and sponsor support from Global Holding Corporation Private Limited (GHC) to Banks and Life Insurance Corporation of India (LIC).

(b) Foreign Currency Term Loan from Financial Institutions is secured as follows:

Specific Charge - Secured Foreign Currency Lender of erstwhile standalone Company will continue to have specific charge on the assets or properties of erstwhile standalone Company as existed on the effective date of merger i.e December 22, 2017.

(c) All Secured Lenders have parri passu charge on all the present and future current assets including Cash flow and assets or properties acquired and erected after the effective date of merger i.e December 22, 2017

During the financial year 2020-21, the Company has received notices of recall of loans from Edelweiss Asset Reconstruction Company Limited (âEARCâ) and IDBI Bank claiming alleged default of '' 382,261 Lakhs and '' 20,102 Lakhs respectively. However , in absence of directions from lenders as stated in Note No. 18.1, the Company continues to mention terms of repayment (Refer note No 18.3) and amount of Overdue (Refer note no. 18.4) as on March 31,2023 in terms of and in accordance with the payment schedule, terms and conditions of Strategic Debt Restructuring Scheme as approved by then lenders.

22.1 Foreign Currency Convertible Bonds (FCCBs) :

(i) During the financial year 2017-18, the Company had issued 80,745 Zero Coupon Foreign Currency Compulsorily Convertible Bonds due on 2022 of US$ 1000 each (âSeries B1 Bonds), 86,417 Interest Bearing Convertible Bonds due on 2022 of US$ 1000 each (âSeries B2 Bondsâ) and 30,078 Zero Coupon Compulsorily Convertible due 2022 of US$ 1000 each (âSeries B3 Bondsâ) in exchange of the then Existing outstanding Interest Bearing Convertible Bonds due 2017 (âSeries B Bondsâ) of US$ 167,193,000 along with redemption premium and outstanding interest on Series B Bonds, pursuant to Offering Memorandum dated October 26, 2017. Since these bonds were issued against the cashless exchange offer, the Company did not receive any proceeds from the offering of the Series B1 Bonds, Series B2 Bonds and Series B3 Bonds.

(ii) Terms and Conditions of the Series B1 Bonds:

a. The Series B1 Bonds are compulsorily convertible into fully paid equity shares of '' 10 each on October 27, 2022 at a fixed rate of exchange of '' 65.1386 to US$.1.00 subject to certain adjustments as described in Terms and Conditions of Series B1 Bonds;

b. The Series B1 Bonds are also convertible at the option of the holders of the Series B1 Bonds, (i) at any time from the date of issue of the Series B1 Bonds up to March 20, 2018, into equity shares at a conversion price equal to '' 20 per share, provided however, that on occurrence of a proposed Change of Control on and from the date issue of the Series B1 Bonds till March 20, 2018, the conversion price will be reset to '' 10 per Share; or (ii) at any time after March 20, 2018, into Shares at a conversion price being the higher of (a) '' 10 per Share, or (b) Regulatory Floor Price in each case at a fixed rate of exchange on conversion of '' 65.1386 to U.S.$1.00 subject to certain adjustments as described in Terms and Conditions of Series B1 Bonds.

c. The Series B1 Bonds do not bear any interest.

(iii) Terms and Conditions of the Series B2 Bonds:

a. The Series B2 Bonds bear interest at a fixed rate of 6.7310% p.a. payable semi-annually in arrears on April 26 and October 26, beginning on the 12 months anniversary of the issuance of the Series B2 Bonds i.e. on October 26, 2018.

b. The Series B2 Bonds are redeemable at 100% of its principal amount on October 27, 2022 unless previously redeemed, converted or purchased and cancelled.

c. The Series B2 Bonds are convertible at the option of the holders of the Series B2 Bonds at any time from the date of the issue of the Series B2 Bonds up to the close of business on October 27, 2022 into Equity Shares at a conversion price equal to '' 10 per Share with a fixed rate of exchange on conversion of '' 65.1386 to U.S.$1.00 subject to certain adjustments as described in Terms and Conditions of Series B2 Bonds.

d. Following the occurrence of a Change of Control, the holder of each Series B2 Bond will have the right at such holder''s option to require the Company to redeem in whole but not in part such holder''s Series B2 Bonds at 100% of their principal amount (âChange of Control Put Priceâ), together with accrued and unpaid interest and default interest (if any) up to and including the date of payment of the Change of Control Put Price.

(iv) Terms and Conditions of the Series B3 Bonds:

a. The Series B3 Bonds are compulsorily convertible into fully paid equity shares of '' 10 each on October 27, 2022 at a fixed rate of exchange of '' 65.1386 to US$.1.00 subject to certain adjustments as described in Terms and Conditions of Series B3 Bonds;

b. The Series B3 Bonds are convertible at the option of the holders of the Series B3 Bonds at any time from the date of issue of the Series B3 Bonds up to the close of business on October 27, 2022 into Equity Shares at a conversion price equal to '' 10 per Share with a fixed rate of exchange on conversion of '' 65.1386 to U.S.$1.00, subject to certain adjustments as described in Terms and Conditions of Series B3 Bonds.

c. The Series B3 Bonds do not bear any interest.

(v) Series B1 & Series B3 bonds have become compulsorily convertible upon maturity date i.e. October 27, 2022. The Company has requested bondholders to share their respective details for converting bonds and crediting equity shares to their respective account. However, the Company is still awaiting the relevant details of bondholders. Series B2 Bonds are redeemable and have matured on October 27, 2022. The lead secured lender has, however, informed the Company that till the time the entire outstanding Secured debt of the Secured lenders is fully paid off, no other creditor including Series B2 Bondholders, which rank sub-ordinate to the secured creditors, can be paid in priority. Hence, the Company could not redeem Series B2 Bonds on its maturity. As per the Terms and Conditions of Series B2 Bonds, in case of default in redemption of Series B2 Bonds, conversion right of bondholders will revive and /or will continue to be exercisable up to the date of receipt of redemption amount by the Principal Agent / Trustee of the Series B2 Bonds.

(vi) As on March 31,2023, 27,728.50 Series B1 Bonds, 58,478 Series B2 Bonds and 10,330 Series B3 Bonds were outstanding.

Considering the current situation of telecom scenario mentioned in note no. 59 and dismantling of sites as mentioned in note no. 58, the Company carried out an impairment test of its property, plant and equipment in accordance with the Indian Accounting Standards (Ind AS) 36 - ''Impairment of Assets'' and found that the Carrying cost of these assets exceeds its value in use; therefore, an impairment loss of '' 58,654 Lakhs has been recognized for the year ended March 31,2023 (previous year '' 66,346 Lakhs) and the same has been disclosed as exceptional items.

36. Pursuant to the Energy Management & Field Level Management Services Agreement and Suspension Agreement, GTL Limited (âGTLâ) invoked arbitration against the Company claiming '' 69,000 Lakhs along with damages under its recovery. Arbitral Tribunal of 3 (Three) retired Supreme Court Judges has been formed and on examination of the underlying facts, the Hon''ble Tribunal passed its interim award dated December 17, 2019 directing the Company to pay an amount of '' 44,000 Lakhs. The Company preferred an appeal before the Hon''ble Delhi High Court. While confirming the interim award passed by the Arbitral Tribunal, the appeal was dismissed by the High Court. In view of the Arbitration award and dismissal of appeal by Delhi High Court, the Company had provided '' 44,000 Lakhs as claims against arbitration and disclosed the same as exceptional items in the financial statements in FY 2019-20.

In the month of June, 2020 EARC challenged the Interim Award dated December 17, 2019 by way of an appeal before the Hon''ble Delhi High Court (âeArC Appealâ). On November 18, 2020 the said EARC Appeal was disposed off by the Hon''ble Delhi High Court thereby allowing the appeal of the EARC and modified the Interim Award dated December 17, 2019 to the extent that all payments directed thereunder, would be deposited, not with the Company or in an Escrow Account to be maintained by the Company, but in the TRA, created and maintained in accordance with the TRA Agreement. The said deposit amount shall remain subject to further orders to be passed by the learned Arbitral Tribunal. After the said Judgment and Order dated November 18, 2020, EARC had filed a Clarification application and Review Petition in regards with the said Judgment and Order dated November 18, 2020. The Clarification Application and the Review Petition were dismissed by the Hon''ble Delhi High Court on February 3, 2021 and February 4, 2022 respectively. EARC thereafter has filed a Special Leave Petition (SLP) before the Hon''ble Supreme Court of India, against the Delhi High orders dated November 18, 2020 and February 4, 2022. EARC through Impleadment application has requested to the Hon''ble Supreme Court to implead the non-assigning lenders of the Company to the said SLP. Company has filed its reply and now the matter is posted for hearing on May 17, 2023. The balance claim of GTL is still under consideration by the Arbitral Tribunal, final hearing by GIL and GTL are completed and matter reserved for final order.

* During the year, the Company was in receipt of the Income Tax Order Under Section 271(1)(c) of the Income Tax Act,1961 passed by the National Faceless Assessment Centre (NFAC) in case of erstwhile Chennai Network Infrastructure Limited (CNIL) for Assessment Year (AY) 2016-17 imposing a penalty of '' 12,904 Lakhs for furnishing inaccurate particulars.

There were various disallowances of expenses made in the regular assessment for the AY 2016-17 for which the erstwhile CNIL/ the Company has filed appeals before the Commissioner of Income Tax (Appeals). The appeals filed before the Commissioner of Income Tax (Appeals) in respect of the Assessment framed for the AY 2016-17, for which penalty is being imposed, has already been settled under the âThe Vivad Se Vishwas Scheme 2020â and as a matter of settlement the Income Tax Department has issued Form 5, in respect of the those appeals. Therefore, the penalty under said Section 271(1)(c) is not leviable as per the Vivad Se Vishwas Scheme, 2020.

Considering the above fact the Company has filed a writ petition before the Honourable Bombay High Court.

ii) Certain Legal issues are outstanding against the Company mainly in relation to the alleged non-compliance of policies of municipal corporations, cases pending for permanent injunctions, objections by the local residents, disputes with site owners, in respect of which the amounts cannot be quantified at this stage and therefore the Contingent Liability in respect of this could not be determined.

The Company does not expect any material financial effect of the above matters under litigation.

39. During earlier years, as legally advised, the Company''s CENVAT credit aggregating to '' 7,993 Lakhs was utilized for discharging service tax liability of CNIL, an erstwhile Associate, which subsequently got merged with the Company. CNIL also paid the same amount to the Service Tax Authority under Voluntary Compliance Encouragement Scheme (VCES) in November, 2013. Subsequently, the Company filed a writ petition in High Court of Judicature at Mumbai for seeking restoration of this cenvat credit and based on the Mumbai High Court direction, CESTAT passed the order in March 2015 for allowing the Company to restore the said amount as Cenvat credit. The Service tax authorities have filed an appeal with the High court challenging the CESTAT order passed in March 2015. The Company has been advised that there will not be any outflows in this regard.

40. The Hon''ble Supreme Court vide its order dated December 16, 2016 upheld that âMobile Telecommunication Towerâ is exigible to Property Tax and the State can levy property tax to Mobile Towers. While deciding the Special Leave Petition (SLP) for Mumbai matters, the Hon''ble Supreme Court had given liberty to agitate the issue with regard to the retrospective operation of assessment/demand of tax and the quantum thereof before the appropriate forum. Post the Judgment of Hon''ble Supreme Court in January 2017; the Company had challenged the quantum of property tax and other issues before the Bombay High Court. By an order dated April 18, 2017, Bombay High Court dismissed the appeal. Against the said order, the Company preferred a SLP with regards to the manner, quantum, component of property tax and other issues. The same was heard on January 25, 2018 and the Hon''ble Supreme Court was pleased to issue a notice to Municipal Corporation & also directed Municipal Corporations to maintain status quo. The said SLP was finally disposed of by an order dated January 02, 2019 and Hon''ble Supreme Court has set aside the Bombay High Court order dated April 18, 2017 and has directed the Bombay High Court to decide the Writ Petition on merits. The Company has filed an amendment application before the Bombay High Court in view of the Supreme Court order and developments happened during the pendency of the SLP before Supreme Court.

Another IP Company by name ATC Telecom Pvt. Ltd (âATC Company'''') have preferred an appeal before Hon''ble Supreme Court against the Order of the Gujarat High Court on the rates and taxes to be fixed for mobile towers in lieu of the Amendment made in the Gujarat Provincial Municipal Corporation Act, 1949 in the year 2011. The Hon''ble Supreme Court after hearing the ATC Company in September, 2018 has granted leave and the matter is pending for final hearing. Further, The Company has also filed a SLP on July 10, 2019, bearing SLP No. 16649 of 2019 before Hon''ble Supreme Court against Nagpur Municipal Corporation challenging the calculation and quantum of the Property Tax. The Hon''ble Supreme Court has given a stay on the High Court Order subject to payment of 50% of the demanded amount and tagged the said matter with ATC SLP. Also with respect to the few sites where demand notices for property tax have been received, the Company has contested the demands by filing writ petitions in appropriate Courts for the assessment of property tax demand / retrospective levy of property tax, procedure and quantum that have been demanded. Various Hon''ble High Courts passed an order not to take any coercive action till the admission of matter.

The matter being still sub-judice, non-receipt of demand notes for majority of the towers of the Company and the Company''s right to recover property tax from certain customers, the Company is unable to quantify actual property tax amount payable excluding the components which are under challenge. The provision will be considered as and when the matter is resolved. In respect of the above, the auditors have issued modified report for the year ended on March 31,2023.

43. Details of loans given, investment made and guarantees given, covered U/s 186(4) of the Companies Act, 2013

The Company has not given any Loan or Guarantee to any party for their borrowings. Details of Investments are given in note no. 4 and 9 to the Financial Statements.

44. DEFERRED TAX

44.1 Reconciliation of tax expenses and the accounting profit multiplied by domestic tax rate

The Company has incurred losses during the financial year 2022-23 and previous financial year 2021-22. The Company has no tax expenses in these years as per provisions of Income Tax Act, 1961 and no deferred tax assets recognised. Since the Company has been following the new tax regime, effective tax rate applicable for financial year 2022-23 is 25% in case of income other than Capital Gains and 20 % in case of Long Term Capital Gain.

45. DISCLOSURE ON REVENUE RECOGNITION

(a) Disaggregated Revenue information & Performance Obligation

The Company provides passive infrastructure on shared basis to telecom operators (Telcos) for hosting their active network components. The business model of passive infrastructure sharing is based on building, owning, operating and maintaining passive telecom infrastructure sites capable of hosting active network components of various technologies of multiple Telcos. The Company''s operation is solely in geographic boundaries of India. The main source of revenue includes Infrastructure Provisioning fee (IPF) & Reimbursements of Energy & Other Cost. It''s an ongoing service performance obligation based on long term contracts with the customers with pre defined lock in periods, contracts are optimally designed based on fixed or actual contract basis matrix. Since the performance obligation is an ongoing process the same is billed on monthly basis / satisfaction of conditions in contract, which falls due for payments within upto 30 days of billing or advance as per terms of contract. (Refer note no. 27 for Segregation of Revenue).

(b) Trade Receivables and Contract balances

The timing of revenue recognition, billings and collections results in receivables, unbilled revenue and unearned revenue on the Company''s Balance Sheet. Amounts are billed in accordance with agreed-upon contractual terms on monthly basis. The Company''s receivables are rights to consideration that are unconditional. Unbilled revenues comprising revenues in excess of billings from the contracts, which are classified as financial assets when the right to consideration is unconditional and is due only within a month. Invoicing to the customers is based on the contracts and therefore, the timing of revenue recognition is different from the timing of invoicing to the customers. Invoicing in excess of earnings is classified as unearned revenue. Trade receivables and unbilled revenues are presented net of provision in the Balance Sheet.

Fair Valuation techniques used to determine fair value

The Company maintains procedures to value financial assets or financial liabilities using the best and most relevant

data available. The fair values of the financial assets and liabilities are included at the amount 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.

The following methods and assumptions were used to estimate the fair values:

i. Fair Value of mutual fund are reported as per Net Asset Value

ii. The fair values of non-current loans/Borrowings and security deposits are calculated based on Discounted Cash Flows technique (DCF) using a current lending rate relevant to the instrument

iii. Fair value of trade receivable, cash & cash equivalents, other bank balances, trade payables, loans and other financial assets and liabilities are approximate to their carrying amounts largely due to the short-term maturities of these instruments.

iv. Fair Value of financial instruments measured at amortised cost such as Deposits, Borrowings, Lease Liabilities etc are approximate to their Carrying values.

v. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

51. FAIR VALUE HIERARCHY

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation techniques: -

Level 1:- Quoted prices / published NAV (unadjusted) in active markets for identical assets or liabilities. It includes fair value of financial instruments traded in active markets and are based on quoted market prices at the balance sheet date and financial instruments like mutual funds for which net assets value (NAV) is published by mutual fund operators at the balance sheet date.

Level 2:- Inputs, other than quoted prices included within level 1, that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). It includes fair value of the financial instruments, that are not traded in an active market, which is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on the Group specific estimates. If all significant inputs required to fair value an instrument are observable then instrument is included in level 2.

Level 3:- Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs). If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

52. FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES:

The Company''s principal financial liabilities comprise loans and borrowings including Interest thereon, Lease Liabilities, Trade payables, Capex Creditors, deposits from Customers and others Financial Liabilities. The main purpose of these financial liabilities is to finance the Company''s operations, including Tower/Network upgradation projects under implementation. The Company''s principal financial assets include Investments, Deposits, loans and advances, receivables and cash and bank balances that are derived directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Risk Management Committee in consultation with Audit Committee of the Board of Directors of the Company oversees the management of these risks. The focus of Risk Management is to assess risks, monitor, evaluate and deploy mitigation measures to manage these risks within risk appetite.

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

1) Market Risk

Market risk is the risk that the fair value of future cash flows of financial instruments will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial Instrument affected by market risk includes loans and borrowings, deposits and mutual funds.

As the revenues from Company''s tower business are dependent on the sustainability of Telecom sector, Company believes that macro-economic factors, including the growth of Indian economy, interest rates as well as political & economic environment, have a significant direct impact on Company''s business, results of operations & financial positions.

I ndia''s top telecoms companies, including Reliance Jio, Vodafone Idea and Bharti Airtel, have appealed to the government for reduced levies, saying the sector requires more financial relaxation and support for viability and sustenance. Through the Cellular Operators Association of India, the industry is seeking a reduction in license fees, from 3% to 1% and a deferral of the universal service obligation levy of 5%.

(i) Above exposure does not include exposure towards Foreign Currency Compulsory Convertible bonds (FCCB) B1 & B3.

(ii) Amounts in INR are reported at the closing exchange rates.

(iii) Amounts reported above are at actuals while same are measured at amortised cost in the Financial Statements.

c) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Company''s fixed rate long term borrowings, which constitute more than 95% of the total borrowings, carry step up interest rate with a predetermined yield rate which is fixed throughout the tenor of the borrowings, whereas floating rate long Term Borrowing is exposed to market rate fluctuations. As such, considering the ratio of fixed rate and floating rate borrowings, risk exposure is at minimum level.

d) Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s borrowings related to its foreign currency convertible bonds & foreign currency loan.

Foreign currency risk is managed by effective foreign risk management policy based on risk perception of the management

e) Commodity Price Risk

The Company invests on upgradation of its tower assets which includes purchases of A class items like Battery banks, Diesel Generators, SMPS and other electrical items. The prices of these items fluctuate based on the prices of its raw material. Metal prices depends on the LME rate (London metal exchange), any variation in the LME prices, battery prices gets fluctuate.

Further, Company consumes diesel and electricity for running its tower sites. These rates for diesel and electricity fluctuate based on central & state policies. Company has entered into contracts with the Customers for recovery of diesel and electricity expenses. These contracts are linked with actual diesel and electricity rates thus resulting in natural hedging.

Commodity price risk is managed by effective risk management policy with help of Company''s Supply Chain Management Team and Central Purchasing Committee based on risk perception.

2) Credit Risk

Credit risk refers to the risk of default of obligations by the counterparty resulting in a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and investments in mutual funds.

Trade Receivables

The Company periodically assesses the financial reliability of its customers, taking into account the current economic trend, business challenges, historic trend of payments, bad debts & ageing of accounts receivables. The Company provides Passive Telecom Infrastructure to Telecom Operators in India. During previous few years, all telecom companies faced increased pressure on earnings and financing fronts, which in turn adversely impacted financing and fund raising plans of tower companies.

The Company lost substantial number of tenancies in last few years, due to various events which were beyond management control, such as shutdown/exit of major telecom operators including Aircel Group, Reliance Communications and Tata Tele, Shyam Sistema Business combination of Vodafone & Idea (VIL), Telenor & Airtel, etc. The Company believes that it has binding long term contractual lock in arrangements with Aircel/other customers and accordingly, continues to pursue its claim of approx. '' 15,34,023 Lakhs arising out these developments. One of the customers, is not paying its monthly invoices raised by the Company on time and delaying the same by one/two months. Even after continuous followup, apart from making delayed payment, it is unilaterally making deductions. Additionally, another customer is facing financial crunch, which has resulted in long pending overdue and uncertainty in collection. The Company has already initiated the arbitration and legal recourse for recovery proceedings against the defaulting customers.

The Company, as a part of its risk management plan, has proactively taken various measures including legal measures to recover its dues from defaulting operators. In case of BSNL, to mitigate the funding risk, the Company has terminated certain non-paying sites by following due contractual process. On the other hand, the Company is taking measures to ensure smooth operations and contracted network time for remaining customers which would enable the Company to keep the credit risk at moderate level. The Company has also obtained rolling advances & security deposits from its customers which in turn mitigate the credit risk to that extent.

The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables. The provision matrix takes into account available external and internal credit risk factors and the Company''s historical experience with customers.

Financial instruments and Bank deposits

The Company''s Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy subject to lenders'' consent.

3) Liquidity Risk

Liquidity risk is that the company will not be able to settle or meet its obligation on time or at reasonable price. Company''s principal sources of liquidity are cash flows generated from its operations including deposits and advances received from customers as a part of its contractual terms. Considering the various developments during the last decade in telecom sector affecting the Company, various steps have been initiated by the Company to ensure that liquidity risk remains at low level.

The Company lost substantial number of tenancies in last few years, due to various events which were beyond management control, such as shutdown / exit of major telecom customers including Aircel Group, Reliance Communications and Tata Tele, Business combination of Vodafone & Idea (VIL), Telenor & Airtel, etc. The Company believes that it has binding long term contractual lock in arrangements with Aircel/other operators and accordingly, continues to pursue its claim of approx. '' 15,34,023 Lakhs arising out these developments.

One of the customers, in its latest published unaudited financial results for the quarter and nine months ended December 31,2022, had indicated that its ability to continue as a going concern is dependent on its ability to raise additional funds as required, successful negotiation with lenders and vendors for continued support and generation of cashflow from operations for settling its liability as they fall due. The said customer had also disclosed in its financial results that so far it has met all debt obligations to its lenders / banks and financial institutions along with applicable interest till date.

The Company, in these circumstances, has proactively taken various steps to ensure smooth operations and contracted network uptime for its existing customers, namely VIL, Reliance Jio, Bharti Airtel, BSNL etc. These steps include reduction in fixed/semi variable costs including electricity and diesel charges, operations and maintenance charges, ground rent, terminating non-paying site after following contractual process, initiating arbitration for recovery of dues etc. The Company is also in the process of re-negotiating its arrangements with existing vendors. These steps are expected to enable the Company to remain EBITDA positive.

The Hon''ble National Company Law Tribunal, Mumbai Bench (âNCLTâ) vide its order dated November 18, 2022 has dismissed petition filed by one of the secured lenders for initiation of Corporate Insolvency Resolution Process (âCIRPâ) under Section 7 of the Insolvency & Bankruptcy Code, 2016 (âIBCâ). The said lender has filed an appeal against this order before the Hon''ble National Company Law Appellate Tribunal (âNCLAT''''). In the meantime, EARC who is the lead lender of the Company has filed its Intervention Application in abovementioned Appeal. The Company has filed its reply to the appeal as well as EARC intervention application and now matter is posted for hearing on May 26, 2023.

The Company is optimistic that various resource optimization initiatives under taken by the Company along with positive developments in telecom sector can lead to stabilization and revival.

53. CAPITAL MANAGEMENT

For the purpose of the Company''s capital management, capital includes issued equity capital, mandatorily convertible foreign currency bonds, securities premium, all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company''s capital management is to ensure continuity of the operating activities of the Company.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The funding requirement is met through internal accruals of the Company.

No changes were made in the objectives, policies or processes for managing capital during the year ended March 31,2023.

54. The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective

â¢ The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

â¢ The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall: (a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or (b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

â¢ The Company has not received any fund from any person(s) or entity(s), including entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the (a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or (b) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

â¢ The Company does not have any such transaction which is not recorded in the books of accounts surrendered or disclosed as income during the year in the tax assessments under the Income-tax Act, 1961.

â¢ No proceeding has been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

â¢ The Company is not declared wilful defaulter by any bank or financial institution or other lender.

57. The management and authorities have the power to amend Financial Statements in accordance with section 130 and 131 of Companies Act, 2013.

58. DISMANTLING OF UNOCCUPIED SITES

During last decade, there were various developments which adversely impacted Indian telecom sector. The extremely challenging external environment during last decade impacted the Indian telecom sector where even multinational companies and/or large Indian conglomerates have either (i) shut down and exited from the telecom sector or (ii) downsized their operations significantly. The first set of issues included the landmark judgement of the Hon''ble Supreme Court cancelling 122 2G telecom licenses in February 2012 (including licenses of Uninor, Videocon, Etisalat, Idea and Tata), the Vodafone Tax issues, the 3G auctions and the unsustainable debt accumulated by the telecom companies. All these factors led to mass exits of operators and significant scale down by the remaining. As a result, majority of the Company''s telecom sites turned into single tenant sites. Thereafter, the year 2017-18 has seen unprecedented shutting down of some of the major telecom operators such as Aircel Group (then largest customer of the Company), Tata Teleservices, Reliance Communication, Sistema Shyam (merged with Reliance Communication) and Telenor (merged with Airtel). Thus, consequent to closure of 14 telecom customers, more than 14,000 towers of the Company were abandoned by such discontinuing operators, thereby making such towers unoccupied, which is more than 50% of the total tower portfolio. These external events were beyond the control of the management and the Company. Post abandonment of these towers, the discontinuing operators didn''t make payment of their contractual dues including rent payable to landlords, taxes and other dues, etc., related to unoccupied towers remained unpaid, many of which are pass through payments for the Company. As a result, the Company was saddled with substantial costs and liabilities including rents, taxes and other dues on such unoccupied towers without any revenue. The Company is already litigating with such discontinuing operators to recover its contractual dues, which are amounting to more than '' 15,34,023 Lakhs.

The Company, on a monthly basis, has been requesting EARC, being Monitoring Institution for payments due to the landlords of the unoccupied sites. However, the same is yet to be approved by the EARC.

Due to non-receipt of the rental amounts, many of the landowners blocked access to our Company''s employees to sites. Resultantly, disgruntled landlords / unknown miscreants resorted to unauthorized dismantling of the tower sites. 2,932 sites got dismantled during Year ended March 31, 2023 (Previous Year 259 sites) out of the above unoccupied sites. This has resulted into a loss (net) of '' 34,169 Lakhs for the year ended March 31,2023 (Previous year '' 3,181 Lakhs) which is included in other expenses in the Financial Statements.

The Company has already initiated various steps to protect its assets from such miscreants including carrying out additional surveys, discussion with landowners, legal actions against such miscreants, recovering site material, lodging of police complaints / FIR and insurance claim etc. Additionally, the Company has deployed Tower Vigilance Team(TVT) in theft prone areas to curb theft of the towers and tower materials which is showing positive result since deployment. In few cases, thieves have been arrested by the police as a result of additional measures taken by the Company.

59. The Company had undertaken a Corporate Debt Restructuring (CDR) exercise in 2011 as per applicable CDR guidelines and regulations. For reasons beyond the management control, post implementation of CDR package, the adverse conditions relating to the telecom sector had a material adverse impact in the achievement of the CDR projections. These events include the landmark judgement of the Hon''ble Supreme Court cancelling 122 2G telecom licenses in February 2012 (including licenses of Uninor, Videocon, Etisalat, Idea and Tata), the Vodafone Tax issues, the 3G auctions and the unsustainable debt accumulated by the telecom companies. The Company had met its repayment obligations till June 30, 2016 out of its cash accruals and realization from current assets. However in view of the substantial developments which have had a significant impact on the financial performance of the Company, the repayment obligations were not likely to be met going forward. In view thereof, in the Joint Lender Forum (JLF) meeting held on September 20, 2016, the Rupee Lenders reviewed the account and after deliberations, invoked the scheme for SDR. Thus with secured debt reduced to a sustainable level, there was significant investor interest for buying out lenders equity stake as part of the Strategic Debt Restructuring (SDR) process.

Post implementation of SDR scheme, the unprecedented shut downs of major wireless operators such as Aircel Group, Reliance Communications and Tata Tele, consolidation in telecom industry such as Business combination of Vodafone & Idea, Telenor & Airtel have had a material adverse effect on the Company. These event were beyond the control of the management. As a result, the Company lost substantial number of tenancies making more than 14,000 towers unoccupied, which is more than 50% of the total tower portfolio. Also, Company''s EBITDA reduced substantially from '' 1,10,000 Lakhs to less than '' 30,000 Lakhs due to continued cost of unoccupied sites and fall in revenue due to defaults by bankrupt operators.

Table below highlights the tenancies lost by the company due to telecom sector events, which were beyond the management control, such as shut down / exit of 14 Telecom customers over the past few years.

These developments have resulted in reduction in the revenue and earnings and the Company was saddled with substantial costs and liabilities on unoccupied towers. Thus, these factors resulted in erosion of Company''s net worth and provision for impairment of property, plant and equipment.

As a consequence of the above developments, there was an urgent need to right size the debt levels. At the time, the lenders of the Company chose to assign their respective debts in favour of Edelweiss Asset Reconstruction Company Limited (âEARCâ). The Company believed that once the assignment was completed, the debt would be restructured to sustainable levels in a timely manner and accordingly, the Company presented multiple Resolution Plans starting from April 2018 for consideration of lenders'' consortium updating such plans from time to time after taking into account various developments in telecom sector. However, for reasons best known to them, the said Resolution Plans submitted by the Company were never considered by the lenders and also few lenders elected not to assign their respective debts to EARC. Further, a Techno-Economic Viability study for better understanding of the realistic sustainable debt was not carried out.

The Hon''ble National Company Law Tribunal, Mumbai Bench (âNCLTâ) vide its order dated November 18, 2022 has dismissed petition filed by one of the secured lenders for initiation of Corporate Insolvency Resolution Process (âCIRPâ) under Section 7 of the Insolvency & Bankruptcy Code, 2016 (âIBCâ). The said lender has filed an appeal against this order before the Hon''ble National Company Law Appellate Tribunal (âNCLATâ). In the meantime, EARC who is the lead lender of the Company has filed its Intervention Application in abovementioned Appeal. The Company has filed its reply to the appeal as well as EARC intervention application and now matter is posted for hearing on May 26, 2023.

Additionally, the Company has received notices of recall of loans from EARC and IDBI Bank claiming alleged default in terms of Master Restructuring Agreement dated December 31,2011. The Company has strongly refuted the claims, as the lenders knew it fully that restructuring was essential post ARC sale. Meanwhile IDBI Trusteeship Company Limited (ITSL), Security Trustee, on the instruction of lenders of the Company has invoked pledge on 2,85,00,000 equity shares of GTL Limited, pledged by Promoter Group Company and transferred the said shares to their account. The lenders have recovered and appropriated '' 2,010 lakhs (previous year '' 1,391 Lakhs) Lakhs from sale of the said equity shares. The above events, cast significant doubt on the Company''s ability to continue as a Going Concern.

With the telecom sector moving towards stabilization, management believes that below events in telecom sector are positive developments which will lead to increased demand for its towers and thereby increase in the revenue and EBITDA levels.

1. Revival package approved by the Government of India for telecom sector;

2. Hike in mobile call and data tariffs by telecom operators;

3. Mapping of sites for 5G rollout by the operators.

In addition to the above, various resource optimization initiatives undertaken by the Company, can lead to stabilization and revival. Further, the Company also continues to pursue contractual claims of approx. '' 15,34,023 Lakhs from various operators in respect of premature exits by them in the lock in period. One of such claims of the Company against TATA was settled during the year resulting in receipt of arbitration award in favour of the Company and consequent recovery of '' 2,900 Lakhs from TATA.

Considering the above and as the Company does not have any intention to stop its operations or liquidate its assets, the Company continues to prepare the books of account on Going Concern basis.

60. The figures for the corresponding previous year have been regrouped/rearranged wherever necessary, to make them comparable.

61. These financial statements have been approved for issue by the Board of Directors at their meeting held on May 11,2023.

Mar 31, 2021

3 (a) (i) Land includes '' 38 Lakhs (Previous year '' 38 Lakhs) of erstwhile CNIL acquired pursunat to the scheme of arrangement, which are in the process of being transferred in the name of the Company.

3 (a) (ii) Buildings include properties having carrying value of '' 525 Lakhs (Previous year '' 537 Lakhs) for which deeds of

conveyance have yet to be executed in favour of the Company and '' 0.07 Lakhs (March 31, 2017 '' 0.07 Lakhs) towards cost of 70 shares of '' 100 each in a Co-operative Housing Society

3 (a) (iii) Buildings includes Land related properties and Boundary Wall at Sites having carring value of '' 7,916 Lakhs (Previous year '' 12,315 Lakhs).

3 (a) (iv) Additions to Plant & Equipments includes Net Foreign Exchange Difference of '' NIL (Previous year '' 336 Lakhs) Capitalised during the year.

3 (a) (v) Property, Plant and Equipment (PPE) includes assets mortgaged as security (Refer Note No. 20.2)

3 (a) (vi) The Company, in accordance with the Indian Accounting Standard (Ind AS 36) ''Impairment of Assets'', performed an

impairment test based on current expectations of the impact of recent developments in telecom Sector on projected cash flows in tower business. The Carrying value of these assets exceeds its value in use and accordingly an impairment loss of Building '' 369 Lakhs and Plant & Equipments '' 36,519 lakhs has been recognized for the year ended March 31,2021 and the same has been disclosed as exceptional item (previous year Building '' 524 Lakhs and Plant & Equipments '' 40,422 lakhs).

3 (d) (ii) The Company''s Investment Property as at March 31,2021 consists of Building as mentioned above

3 (d) (iii) During the Financial year 2018-19, the Company has transferred Certain office premises from buildings to Investment Property as the same have been rented out. The Fair Value of the Property as at March 31,2021 are '' 3,540 Lakhs (Previous year - '' 3,540 Lakhs).

These valuations are based on ready reckoner rate as on date

The fair value measurement is categorised in Level 3 fair value hierarchy.

3 (d) (iv) Specific Charge - Banks, Financial Institutions and Asset Reconstruction Trust of the erstwhile standalone Company continue to have specfic charge.

18.2 Terms/rights attached to equity shares

18.3 Shares reserved for issue under options :

The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 803,334,811 Equity Shares (Previous year 980,830,982). (Refer Note No. 20.4)

18.5 Out of total paid up capital, 94,843,348 equity shares allotted pursuant to compulsory conversion of Series A Bonds on maturity are not yet listed, since information regarding the Series A Bondholders are not available with the Company. In the absence of requisite information, the Company has allotted the said equity shares to a Trust, created for the benefit of Series A Bondholders.

19.1 Equity Component of Compound Financial Instruments

Equity Component represents FCCB Series B1 & B3 Bonds compulsorily convertible into equity shares. (Refer Note No. 20.4)

19.2 Share Suspense Account

Share Suspense represents number of equity shares to be issued pursuant to the Scheme of Arrangement between CNIL and the Company and their respective shareholders and creditors (the âSchemeâ) and got converted into Equity Shares as per the Scheme.

19.3 Reconstruction Reserve

Created pursuant to scheme of arrangement approved by Hon''ble High Court in earlier years. It shall be utilised as per provisions of Companies Act 2013.

19.4 Capital Reserve

Created On Forfeiture of Preferential Convertible Warrants. It shall be utilised as per provisions of Companies Act 2013.

19.5 Securities premium

Created on conversion of Employee Stock Options Scheme , Preferential Warrants and Foreign currency convertible Bonds. It shall be utilised as per provisions of Companies Act 2013.

20.1 a) As of March 31,2021,79.34% of Indian Rupee Debt of '' 322,625 Lakhs have been assigned in favour of Edelweiss

Asset Reconstruction Company (âEARCâ) acting in its capacity as Trustee of EARC Trust-SC 338 vide assignment agreement executed in favour of EARC. The Company is contesting and pursuing legal proceedings to enforce Reserve Bank of India''s Master Circular on âPrudential Norms on Income Recognition, Assets Classification and Provisioning Pertaining to Advancesâ dated July 1, 2015 (âIRACâ) clause 6.4 (d) (ii) against remaining lenders before the Hon''ble Supreme Court. Pursuant to the same, the Company has not obtained balance confirmations from these lenders.

(b) One of the remaining secured lenders, referred in note no. 20.1 (a) above, allegedly claiming '' 64,638 Lakhs has filed proceedings before the National Company Law Tribunal (the âNCLTâ) under Insolvency and Bankruptcy Code 2016 which has not been admitted so far.

(c) The Hon''ble Supreme Court vide its order dated March 6, 2020 issued a notice and directed the lenders to maintain status quo in the abovementioned matters against which an application for early hearing and vacation of Status quo order has been filed by one of the lenders.

Further, in accordance with the revised guidelines, the Company has also presented multiple Resolution Plans starting from April 2018 for consideration of lenders'' consortium updating such plans from time to time after taking into account various developments in telecom sector. In the opinion of the managment, EARC consortium have an obligation to restructure the debt in time bound manner after completing TEV study as per RBI guidelines. However, EARC / lenders failed to restructure the debt of the Company till date. Instead EARC has, without the consent of the Company, debited a total amount of '' 35,600 Lakhs from the TRA account during financial year 2020-21. The Company has raised objections to such a withdrawals. Additionally, the Company has received notices of recall of loans from EARC and IDBI Bank claiming alleged default in terms of Master Restructuring Agreement dated December 31,2011. The Company is currently seeking legal advice and will take such necessary actions as it may be advised. Post receipt of recall notices, the Company is in discussion with lenders about proposed realignment of its debt. As per the arrangements with the Lenders, the Company is required to comply with certain covenants and noncompliance with these covenants may give rights to the lenders to demand Repayment of the loans. Considering alleged claims of lenders and to comply with the requirement of Ind AS -1 âPresentation of Financial Statementâ, the Company has classified Non-Current borrowings as Current Financial liability as an abundant precaution, which was classified for the first time in the Balance Sheet as at March 31,2019.

20.2 (A) Rupee Term Loans from Banks, Financial Institutions and Asset Reconstruction Trust are secured as follows:

(i) Specific Charge - Banks, Financial Institutions and Asset Reconstruction Trust of the erstwhile standalone Company '' 172,248 Lakhs (Previous year '' 172,248 Lakhs) and erstwhile CNIL '' 234,377 Lakhs (Previous year '' 234,377 Lakhs ) continue to have specfic charge on the assets or properties of respective companies as existed on the effective date of merger i.e December 22, 2017.

(ii) Personal guarantee of Mr. Manoj Tirodkar (Promoter) and sponsor support from Global Holding Corporation Private Limited (GHC) towards any shortfall in debt servicing to Banks and Life Insurance Corporation of India (LIC).

(B) Foreign Currency Term Loan from Financial Institutions is secured as follows:

Specific Charge - Secured Foreign Currency Lender of erstwhile standalone Company of '' 6,458 Lakhs (Previous year '' 6,240 Lakhs) will continue to have specific charge on the assets or properties of erstwhile standalone Company as existed on the effective date of merger i.e December 22, 2017.

(C) All Secured Lenders have parri passu charge on all the present and future current assets including Cash flow and assets or properties acquired and erected after the effective date of merger i.e December 22, 2017

20.3 Terms of Repayment

(i) Rupee Term Loans from Banks, Financial Institutions and Asset Reconstruction Trust (including Current Maturities of Long-term borrowings) having an effective yield of 10.75% over the tenure of the facility amounting to '' 365,522 Lakhs are repayable in 33 structured quarterly instalments ending on June 30, 2026 as per the SDR termsheet.The Maturity Profile of these loans is as set below:

(iii) Rupee Term Loan from Asset Reconstruction Trust having an Interest rate of 8% p.a aggregating to '' 10,493 Lakhs are repayable only after the Final Settlement date of all the other restructured Loans i.e., June 30, 2026 as per SDR terms,.

(iv) The Foreign Currency Term Loan (included Current Maturities of Long term borrowings) is repayable in 24 equated quarterly instalments of Euro 4 Lakhs starting from June 15, 2013 and ending on March 15, 2021. The loan carries Interest rate of 3 months Euribor 200 bps.

20.4 Foreign Currency Convertible Bonds (FCCBs) :

(ii) Terms and Conditions of the Series B1 Bonds:

price equal to '' 20 per share, provided however, that on occurrence of a proposed Change of Control on and from the date issue of the Series B1 Bonds till March 20, 2018, the conversion price will be reset to '' 10 per Share; or (ii) at any time after March 20, 2018, into Shares at a conversion price being the higher of (a) '' 10 per Share, or (b) Regulatory Floor Price in each case at a fixed rate of exchange on conversion of '' 65.1386 to US$ 1.00 subject to certain adjustments as described in Terms and Conditions of Series B1 Bonds.

c. The Series B1 Bonds do not bear any interest.

(iii) Terms and Conditions of the Series B2 Bonds:

b. The Series B2 Bonds are redeemable at 100% of its principal amount on October 27, 2022 unless previously redeemed, converted or purchased and cancelled.

c. The Series B2 Bonds are convertible at the option of the holders of the Series B2 Bonds at any time from the date of the issue of the Series B2 Bonds up to the close of business on October 27, 2022 into Equity Shares at a conversion price equal to ''10 per Share with a fixed rate of exchange on conversion of '' 65.1386 to US$ 1.00 subject to certain adjustments as described in Terms and Conditions of Series B2 Bonds.

(iv) Terms and Conditions of the Series B3 Bonds:

b. The Series B3 Bonds are convertible at the option of the holders of the Series B3 Bonds at any time from the date of issue of the Series B3 Bonds up to the close of business on October 27, 2022 into Equity Shares at a conversion price equal to '' 10 per Share with a fixed rate of exchange on conversion of '' 65.1386 to US$ 1.00, subject to certain adjustments as described in Terms and Conditions of Series B3 Bonds.

c. The Series B3 Bonds do not bear any interest.

(v) As on March 31,2021,51,348 Series B1 Bonds, 59,168 Series B2 Bonds and 12,811 Series B3 Bonds were

outstanding.

* Included in Current Maturities of Long-Term Borrowings (Refer Note - 25)

** Shown as Interest accrued and due on Borrowings (Refer Note - 25)

During the financial year, the Company has received notices of recall of loans from Edelweiss Asset Reconstruction Company Limited (âEARCâ) and IDBI Bank claiming alleged default of '' 382,261 lakhs and '' 20,102 lakhs respectively, however since the Company is in ongoing litigations with EARC and other remaining lenders before various judicial forums, the Company continues to mention terms of repayment (Refer note No 20.3) and amount of default (Refer note no. 20.5) as on March 31,2021 in terms of and in accordance with the payment schedule, terms and conditions of Strategic Debt Restructuring Scheme as approved by then lenders. (Refer note No. 20.1)

The estimates of rate of increase in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply anad demand in the employment market. The above information is certified by the actuary.

The Expected Rate of Return of Plan Assets is determined considering several applicable factors. Mainly the composition of Plan Assets held, assessed risks, historical results of return on Plan Assets and the Company''s policy for Plan Assets Management.

g. Sensitivity Analysis

Significant Actuarial Assumptions for the determination of the defined benefit obligation are discount trade, expected salary increase and employee turnover. The sensitivity analysis below, have been determined based on reasonably possible changes of the assumptions occurring at the end of the reporting period, while holding all other assumptions constant. The result of Sensitivity analysis is given below:

a) Considering the current situation of telecom scenario mentioned in note no. 59 and dismantling of sites as mentioned in note no. 58 below, the Company carried out an impairment test of its property, plant and equipment in accordance with the Indian Accounting Standards (Ind AS) 36 - ''Impairment of Assets'' and found that the Carrying cost of these assets exceeds its value in use; therefore, an impairment loss of '' 36,888 Lakhs has been recognized for the year ended March 31,2021 and the same has been disclosed as exceptional items (previous year '' 40,946 Lakhs).

b) Pursuant to the Energy Management & Field Level Management Services Agreement and Suspension Agreement, GTL Limited (âGTLâ), invoked arbitration against the Company claiming '' 69,000 Lakhs along with damages under its recovery. Arbitral Tribunal of 3 (Three) retired Supreme Court Judges has been formed and on examination of the underlying facts, the Hon''ble Tribunal passed its interim award dated December 17, 2019 directing the Company to pay an amount of '' 44,000 Lakhs. The Company preferred an appeal before the Hon''ble Delhi High Court, while confirming the interim award passed by the Arbitral Tribunal, the appeal was dismissed by the High Court. In view of the Arbitration award and dismissal of appeal by Delhi High Court, the Company had provided '' 44,000 Lakhs as claims against arbitration and disclosed the same as exceptional items in the financial statements in FY 19-20. After the dismissal of the appeal, the Company entered into a Settlement Agreement with GTL, whereby it was agreed between the parties to settle all the pending disputes and to inboard OME division into the Company, for lump sum settlement of '' 40,000 Lakhs. Lenders consent of respective Parties were pre-condition to the final settlement. Basis settlement, the Company had earmarked '' 31,229 Lakhs. The Company approached the lenders with a request to allow it to make payment as per the agreement but the Lenders of the Company refused to grant consent to the proposed settlement in lenders meeting held on April 23, 2020 and directed the Company to remit the earmarked funds of '' 31,229 Lakhs to the Company''s TRA. In view of the above, the settlement agreement stands cancelled and earmarked amount was deposited in the TRA Account. Accordingly, the interim award dated December 17, 2019 remains unsatisfied.

In the month of June, 2020 EARC challenged the Interim Award dated December 17, 2019 by way of an appeal before the Hon''ble Delhi High Court (âEARC Appealâ), contending that Company and GTL Limited have acted in collusion to obtain the Arbitral Award to defeat EARC''s rights under the MRA & TRA and that the Arbitral Award ought to be set aside. On November 18, 2020 the said EARC Appeal was disposed of by the Hon''ble Delhi High Court thereby allowing the appeal of the EARC and held that the Interim Award is an order under Section 17 and thereby modifying the Interim Award dated December 17, 2019 to the extent that all payments directed thereunder, would be deposited, not with the Company or in an Escrow Account to be maintained by the Company, but in the TRA, created and maintained in accordance with the TRA Agreement. The said deposit amount shall remain subject to further orders to be passed by the learned Arbitral Tribunal. The Hon''ble Delhi High Court did not found any ground to hold that Company and GTL Limited acted in collusion or that they perpetrated fraud either on the learned Tribunal or on the Hon''ble Delhi High Court. After the said Judgment and Order dated November 18, 2020, EARC had filed a Clarification application in regards with the said Judgment and Order dated November 18, 2020. The said Clarification Application was dismissed by the Hon''ble Delhi High Court on February 3, 2021 thereby stating that the Application is misconceived. In the month of April, 2021 EARC has attempted another petition in the form of review Petition before the Delhi High Court and subsequent to year end on April 13, 2021 the matter was posted for 1st hearing. The Hon''ble court has issued notices and has directed the Company and GTL to file its reply. The balance claim of GTL is still under consideration by the Arbitral Tribunal.

39. During earlier years, as legally advised, the Company''s CENVAT credit aggregating to '' 7,993 Lakhs was utilized for discharging service tax liability of CNIL, an erstwhile Associate, which subsequently got merged with the Company. CNIL also paid the same amount to the Service Tax Authority under Voluntary Compliance Encouragement Scheme (VCES) in November, 2013. Subsequently, the Company filed a writ petition in High Court of judicature at Mumbai for seeking restoration of this cenvat credit and based on the Mumbai High court direction, CESTAT passed the order in March 2015 for allowing the Company to restore the said amount as Cenvat credit. The Service tax authorities have filed an appeal with the High court challenging the CESTAT order passed in March 2015. The Company has been advised that there will not be any outflows in this regard.

40. The Hon''ble Supreme Court vide its order dated December 16, 2016 upheld that âMobile Telecommunication Towerâ is exigible to Property Tax and the State can levy properly tax to Mobile Towers. While deciding the Special Leave Petition (SLP) for Mumbai matters, the Hon''ble Supreme Court had given liberty to agitate the issue with regard to the retrospective operation of assessment/demand of tax and the quantum thereof before the appropriate forum. Post the Judgment of Hon''ble Supreme Court in January 2017; the Company had challenged the quantum of property tax and other issues before the Bombay High Court. By an order dated April 18, 2017, Bombay High Court dismissed the appeal. Against the said order, the Company preferred a SLP with regards to the manner, quantum, component of property tax and other issues. The same was heard on January 25, 2018 and the Hon''ble Supreme Court was pleased to issue a notice to Municipal Corporation & also directed Municipal Corporations to maintain status quo. The said SLP was finally disposed of by an order dated January 02, 2019 and Hon''ble Supreme Court has set aside the Bombay High Court order dated April 18, 2017 and has directed the Bombay High Court to decide the Writ Petition on merits. The Company has filed an amendment application before the Bombay High Court in view of the Supreme Court order and developments happened during the pendency of the SLP before Supreme Court.

Another IP Company by name ATC Telecom Pvt. Ltd have preferred an appeal before Hon''ble Supreme Court against the Order of the Gujarat High Court on the rates and taxes to be fixed for mobile towers in lieu of the Amendment made in the Gujarat Provincial Municipal Corporation Act, 1949 in the year 2011. Supreme Court after hearing the ATC Company in September, 2018 has granted leave and the matter is pending for final hearing. Further, The Company has also filed a SLP on 10^th July 2019, bearing SLP No. 16649 of 2019 before Hon''ble Supreme Court against Nagpur Municipal Corporation challenging the calculation and quantum of the Property Tax. The Hon''ble Supreme Court has given a stay on the High Court Order subject to payment of 50% of the demanded amount and tagged the said matter with ATC SLP. Also with respect to the few sites where demand notices for property tax have been received, the Company has contested the demands by filing writ petitions in appropriate Courts for the assessment of property tax demand / retrospective levy of property tax, procedure and quantum that have been demanded. Various Hon''ble High Courts passed an order not to take any coercive action till the admission of matter.

41. As per Ind AS 24, the disclosure of transactions with the related parties are given below:

(a) List of Related Parties and relationships:

(I) Key Management Personnel

Mr. Milind K. Naik, Whole Time-Director

(Retired on July 20, 2020 and reappointed as additional & whole-time director w.e.f January 20, 2021)

Mr. Bhupendra J. Kiny, Chief Financial Officer Mr. Nitesh A. Mhatre, Company Secretary

*As the Liability for gratuity and leave encashment are provided for the company as a whole amounts accrued pertaining to Key managerial personnel are not included above.

# Previous Years remuneration to the Whole Time Director, Mr. Milind Naik, includes the arrears of remuneration of '' 65.96 Lakhs for FY 2017-18 and '' 48.02 Lakhs for FY 2018-19.

# Mr. Milind Naik, Whole-Time Director of the Company retired during the year and was reappointed on January 20, 2021. Approval of shareholders is awaited towards his managerial remuneration.

"Includes shares to be issued to the holders of Foreign Currency Compulsorily Convertible Bonds (FCCB Series-B1 & B3).

#The effect of Foreign Currency Optionally Convertible Bonds (FCCB Series-B2) on the Earnings per Share is anti-dilutive and hence, the same is not considered for the purpose of calculation of dilutive Earning per Share.

43. Details of loans given, investment made and Guarantees given, covered U/s 186(4) of the Companies Act, 2013

The Company has not given any Loan or Guarantee to any party for their borrowings. Details of Investments are given in note no. 4 to the financial statements.

44. Deferred tax44.1 Reconciliation of tax expenses and the accounting profit multiplied by domestic tax rate

The Company has incurred losses during the year 2020-21 and previous year 2019-20. The Company has no tax expenses these years as per provisions of Income Tax Act, 1961 and no deferred tax assets recognised. The effective tax rate applicable for Financial Year 2020-21 is 30% at Maximum Marginal rate.

* Subject to filing of the return of Income

** After Adjustment of settlement made under Vivad Se Vishwas Scheme 2020

From last many years the Company is incurring losses and does not expect sufficient future taxable income in the near future against which the unused tax losses can be utilised, so the Company has not recognised the DTA for the same.

45. During the financial year, the Company had made application under Direct Tax Vivad Se Vishwas Scheme, in order to settle the income tax litigations pending before various income tax forums for the AY 2010-11 to 2017-18. Pursuant to the approval obtained from the Board of Directors in the matter, the Company had filed Form No.1 & 2 under the Scheme, for 18 income tax litigation cases pending before Honourable CIT (A), ITAT and High Court from the AY 2010-11 to 2017-18 including that

of erstwhile Chennai Network Infrastructure Limited. All the cases applied under the scheme have been considered by the Income Tax Department and issued a certificate of acceptance in Form No.3 except in 1 case which has been rejected being consequential nature. Soon after receipt of the Form No.3, the Company applied for the withdrawal of the cases from the relevant Forum, made payment of tax wherever required and intimated the same to the Income Tax Department through Form No.4 who in turn issued the Order of Settlement in Form No.5. (Except in one case which is awaiting).

46. Disclosure on Revenue Recognition

(a) Disaggregated Revenue information & Performance Obligation

The Company provides passive infrastructure on shared basis to telecom operators (Telcos) for hosting their active network components. The business model of passive infrastructure sharing is based on building, owning, operating and maintaining passive telecom infrastructure sites capable of hosting active network components of various technologies of multiple Telcos. Company''s operation are solely in geographic boundaries of India. The main source of revenue includes Infrastructure Provisioning Fee (IPF) & Reimbursements of Energy & Other Cost. It''s an ongoing service performance obligation based on long term contracts with the customers with pre defined lock in periods, contracts are optimally designed based on fixed or actual contract basis matrix. Since the performance obligation is an ongoing process the same is billed on monthly basis which falls due for payments within 30 days of billing or advance as per terms of contract. (Refer note 28).

b) Trade Receivables and Contract balances

The timing of revenue recognition, billings and cash collections results in receivables, unbilled revenue, and unearned revenue on the Company''s Balance Sheet. Amounts are billed in accordance with agreed-upon contractual terms on monthly basis. The Company''s receivables are rights to consideration that are unconditional. Unbilled revenues comprising revenues in excess of billings from the contracts are classified as financial assets when the right to consideration is unconditional and is due only within a month. Invoicing to the customers is based on the contracts and therefore, the timing of revenue recognition is different from the timing of invoicing to the customers. Invoicing in excess of earnings are classified as unearned revenue. Trade receivables and unbilled revenues are presented net of provision in the Balance Sheet.

48. In the opinion of the Management, Non-Current/Current Assets, Loans and Advances are approximately of the value stated if realised in the ordinary course of the business.

49. Segment Reporting

The Company is predominantly in the business of providing âTelecom Towersâ on shared basis and as such there are no separate reportable segments. The Company''s operations are only in India.

Revenues from operation includes '' 132,437 Lakhs (previous year '' 128,238 Lakhs) aggregate amount of revenue from Three customers (previous year three customers), contributing each one of them to more than 10% of total revenue of the company.

These revenues are attributed to the Revenue from Telecom / Network Infrastructure Facilities, energy & Other reimbursements.

50. Fair Values

Set out below, is the carrying amounts and fair value of the Company''s financial assets and liabilities that are recognised in the financial statements

Fair Valuation techniques used to determine fair value

The Company maintains procedures to value financial assets or financial liabilities using the best and most relevant data

available. The fair values of the financial assets and liabilities are included at the amount 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.

The following methods and assumptions were used to estimate the fair values:

i. The fair value of investments in unlisted equity and Preference shares is determined using Net Asset Value (NAV) method.

ii. Fair Value of mutual fund are reported as per Net Asset Value

iii. The fair values of non-current loans/Borrowings and security deposits are calculated based on Discounted Cash Flows technique (DCF) using a current lending rate relevant to the instrument

iv. Fair value of trade receivable, cash & cash equivalents, other bank balances, trade payables, loans and other financial assets and liabilities are approximate to their carrying amounts largely due to the short-term maturities of these instruments.

v. Fair Value of financial instruments measured at amortised cost such as Deposits, Borrowings, Lease Liabilities etc are approximate to their Carrying values.

vi. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

52. Fair Value Hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation techniques: -

Level 2:- Inputs, other than quoted prices included within level 1, that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). It includes fair value of the financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on the Group specific estimates. If all significant inputs required to fair value an instrument are observable then instrument is included in level 2.

The following table provides the fair value measurement hierarchy of the Company''s Assets and Liabilities

53. Financial Risk Management Objective and Policies:

The Company''s principal financial liabilities comprise loans and borrowings including Interest thereon, Trade payables, Capex Creditors, deposits from Customers and others Financial Liabilities. The main purpose of these financial liabilities is to finance the Company''s operations, including Tower/Network upgradation projects under implementation. The Company''s principal financial assets include Investments, Deposits, loans and advances, receivables and cash and bank balances that are derived directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Audit Committee of the Board of Directors of the Company oversees the management of these risks. The focus of Risk Management is to assess risks, monitor, evaluate and deploy mitigation measures to manage these risks within risk appetite.

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

1) Market Risk

As the revenues from company''s tower business are dependent on the sustainability of Telecom sector, Company believes that macro-economic factors, including the growth of Indian economy, interest rates as well as political & economic environment, have a significant direct impact on company''s business, results of operations & financial positions.

The Supreme Court ruled that AGR for Telecoms should include all revenue accrued to the carriers, including from non-core activities. The decision has gone against the telecom operators, another devastating blow to the telecom sector. Bharti Airtel (âAirtelâ) and Vodafone-Idea (âVILâ) have been saddled with dues of around '' 4,757,660 Lakhs and '' 5,040,000 Lakhs respectively.

The Supreme Court in its judgment dated September 1,2020, allowed Telecom operators to make a payment of 10% of the total dues as demanded by DoT, by March 31,2021 and remaining dues in yearly instalments by March 2031. Further, SC had also inform that any default in payment would invite interest, penalty, and contempt of court. As per news reports, DoT reported that Airtel and VIL have failed to pay the first instalment towards AGR on or before March 31,2021, even though Airtel and VIL claimed that they have already paid more than 10% of their total AGR dues and do not need to pay anything by March 31,2021. This clearly is likely to cause a huge strain on the operators, which can be seen from delays in payments by VIL.

In case of BSNL, due to long pending overdues and uncertainty in collection, the Company has taken necessary action to mitigate the funding risk by terminating certain non-paying sites.

(i) Above exposure does not include exposure towards Foreign Currency Compulsory Convertible bonds (FCCB) B1 & B3.

(ii) Amounts in INR are at the closing exchange rates at the year end.

(iii) Amounts reported above are at actuals while same are measured at amortised cost in the financial statements.

c) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Company''s fixed rate long term borrowings carry step up interest rate with a predetermined yield rate which is fixed throughout the tenor of the borrowings, whereas floating rate long Term

Borrowing is exposed to market rate fluctuations.

In order to manage this risk exposure, management keeps a portfolio mix of fixed & floating interest rate Debts in the total portfolio of financial instruments.

Interest rate sensitivity:

With all other variable held constant the following table reflects the impact of borrowing cost on floating rate portion of total Debt:

d) Foreign Currency Risk

Foreign currency risk is managed by effective foreign risk management policy based on risk perception of the management

Foreign Risk sensitivity:

The following table demonstrates the sensitivity in the USD & Euro to Indian '' with all other Variable held constant. The effect on loss before tax due to foreign exchange rate fluctuation:

e) Commodity Price Risk

The Company invests on upgradation of its tower assets which includes purchases of A class items like Battery banks, Diesel Generators, SMPS and other electrical items. The prices of these items fluctuate based on the prices of its raw material. Due to current lockdown, imports are impacted due to certain restriction in government policies resulting in increase in prices.

In case of battery bank the Lead price is based on LME rate ( London metal exchange), any variation in the LME prices, battery prices also get impacted.

Further, Company consumes Diesel and Electricity for running its tower sites. These rates for Diesel and Electricity fluctuate based on central and state policies. Company has entered into contracts with the Customers for recovery of Diesel and Electricity Expenses. These contracts are linked with actual Diesel and Electricity Rates thus resulting in natural hedging.

Commodity price risk is managed by effective risk management policy with help of company''s Supply Chain Management Team and Central Purchasing Committee based on risk perception.

2) Credit Risk

Trade Receivables

The Company lost substantial number of tenancies in last few years, due to various events which were beyond management control, such as shutdown / exit of major telecom operators namely Aircel Group, Reliance Communications and Tata Tele, Business combination of Vodafone & Idea, Telenor & Airtel, recent AGR developments etc. The Company believes that it has binding long term contractual lock in arrangements with Aircel/other operators and accordingly, continues to pursue its claim of approx. '' 1,522,356 lakhs arising out these developments. Further, the Supreme Court''s verdict in AGR case put strain on the telecom operators, which can be seen from delays in payments by VIL. Additionally, BSNL is facing financial crunch, which has resulted in long pending overdue and uncertainty in collection from BSNL.

The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables and unbilled revenues. The provision matrix takes into account available external and internal credit risk factors and the Company''s historical experience with customers.

Financial instruments and Bank deposits

The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which its balances and deposits are maintained. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations

3) Liquidity Risk

Liquidity risk is that the company will not be able to settle or meet its obligation on time or at reasonable price. Company''s principal sources of liquidity are cash flows generated from its operations including deposits and advances received from customers as a part of its contractual terms. In view of recent telecom sector developments affecting the Company, various steps have been initiated by the Company to ensure that liquidity risk remains at low level.

The Company lost substantial number of tenancies in last few years, due to various events which were beyond management control, such as shutdown / exit of major telecom operators namely Aircel Group, Reliance Communications and Tata Tele, Business combination of Vodafone & Idea, Telenor & Airtel, recent AGR developments etc. The Company believes that it has binding long term contractual lock in arrangements with Aircel/other operators and accordingly, continues to pursue its claim of approx. '' lakhs arising out these developments. Further, the Supreme Court''s verdict in AGR case put strain on the telecom operators, which can be seen from delays in payments by VIL. Additionally, BSNL is facing financial crunch, which has resulted in long pending overdue and uncertainty in collection from BSNL.

The Company, in these circumstances, has proactively taken various steps to ensure smooth operations and contracted network uptime for its existing customers, namely Vodafone Idea Ltd, Reliance Jio, Bharti Airtel, BSNL etc. These steps include realignment of debt with revised cash flows, reduction in fixed/semi variable costs including wages, electricity and diesel charges, operations and maintenance charges, ground rent, terminating non-paying site after following contractual process, initiating arbitration for recovery of dues etc. The Company is also in the process of re-negotiating its arrangements with existing vendors. These steps are expected to enable the Company to remain EBITDA positive during the turnaround phase.

The proceeding initiated by one of the remaining secured lenders, allegedly claiming '' 64,638 Lakhs has filed proceedings before the National Company Law Tribunal (the âNCLTâ) under Insolvency and Bankruptcy Code 2016 which has not been admitted so far. The Hon''ble Supreme Court vide its order dated March 6, 2020 was pleased to issue notice and directed the Respondents to maintain status quo in the matter.

The Company is optimistic that various resource optimization initiatives under taken by the Company along with the restructuring can lead to stabilization and revival.

54. Capital Management

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31,2021.

55. The outbreak of corona virus (COVID-19) pandemic globally and in India is causing significant disturbance and slowdown of economic activity. The Ministry of Home Affairs notified telecommunication services including telecom infrastructure services among the essential services which continued to operate during lock down. The passive infrastructure as well as active telecom operations are actively engaged in fulfilling the surge in demand arising out of the choice exercised by almost all industries to conduct their operations remotely. The current "âsecond waveâ that has significantly increased the number of cases in India has resulted in operational challenges in carrying out field work due to regional / local restrictions in areas with significant number of COVID-19 cases. The Company is trying its best to keep the customer focus / network uptime humming. The Company continues to closely monitor the development and possible effects that may result from the current pandemic, on its financial condition, liquidity & operations and it is actively working to minimize the impact of this unprecedented situation.

56. The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.

57. The management and authorities have the power to amend financial statements in accordance with section 130 and 131 of Companies Act, 2013.

58. Dismantling of Unoccupied Sites

Thus, consequent to closure of 12-14 telecom operators, more than 14,000 towers of the Company were abandoned by such discontinuing operators, thereby making such towers unoccupied, which is more than 50% of the total tower portfolio. These external events were beyond the control of the management and the Company. Post abandonment of these towers, the discontinuing operators didn''t make payment of their contractual dues. The Company has already litigating with such discontinuing operators to recover its contractual dues, which are amounting to more than '' 1,522,356 lakhs.

Due to non-receipt of the rental amounts from the discontinuing operators as per contractual arrangement, the rentals to landlords for those sites remained unpaid. During the year ended March 31, 2021, disgruntled landowners / miscreants dismantled 1,171 sites out of the above unoccupied sites. The Company has already initiated various steps to protect its assets from such miscreants including legal actions against such miscreants, recovering site material, lodging of police complaints / FIR and insurance claim etc.

This has resulted into a loss of '' 16,314 Lakhs for the year ended March 31,2021 which is included in other expenses in the financial Statements.

59. The Company had undertaken a Corporate Debt Restructuring (CDR) exercise in 2011 as per applicable CDR guidelines and regulations. For reasons beyond the management control, post implementation of CDR package, the adverse conditions relating to the telecom sector had a material adverse impact in the achievement of the CDR projections. The Company had met its repayment obligations till June 30, 2016 out of its cash accruals and realization from current assets. However in view of the substantial developments which have had a significant impact on the financial performance of the Company, the repayment obligations were not likely to be met going forward. In view thereof, in the Joint Lender Forum (JLF) meeting held on September 20, 2016, the Rupee Lenders reviewed the account and after deliberations, invoked the scheme for SDR. Thus with secured debt reduced to a sustainable level, there was significant investor interest for buying out lenders equity stake as part of the Strategic Debt Restructuring (SDR) process.

These developments have resulted in reduction in the revenue and earnings resulting in erosion of Company''s net worth and provision for impairment of property, plant and equipment. Further the Company has received notices of recall of loans from EARC and IDBI Bank claiming alleged default in terms of Master Restructuring Agreement dated December 31,2011. The Company has strongly refuted the claims. Simultaneously, the Company is also discussing with Lenders the proposed realignment of debt.

With the telecom sector moving towards stabilization, management believes that below events are positive developments which will lead to stabilization and revival of company.

1. Non-cancellable contract revenue from major 3 operators viz. Reliance Jio, Bharti Airtel and Vodafone Idea Ltd.

2. Constructive progress on negotiations with leading operator for bulk tenancy on unoccupied and single tenant towers

3. The Company also continues to pursue contractual claims of approx. '' 1,522,356 lakhs from various operators in respect of premature exits by them in the lock in period.

The Company is optimistic that the proposed realignment of debt with Lenders in accordance with cash flows will be concluded in near future. In addition to the above, various resource optimization initiatives undertaken by the Company, can lead to stabilization and revival. Therefore, the Company continues to prepare the books of account on Going Concern basis.

60. The figures for the corresponding previous year have been regrouped/rearranged wherever necessary, to make them comparable.

61. These financial statements have been approved for issue by the Board of Directors at their meeting held on June 3, 2021.

Mar 31, 2018

1. Land includes Rs.38 Lakhs of erstwhile CNIL acquired pursuant to the scheme of arrangement, which are in the process of being transferred in the name of the Company.

2. Buildings include properties having carrying value of Rs.563 Lakhs (March 31, 2017 Rs.572 Lakhs) for which deeds of conveyance have yet to be executed in favour of the Company and Rs.0.07 Lakhs (March 31, 2017 0.07 Lakhs) towards cost of 70 shares of Rs.100 each in a Co-operative Housing Society

3. Buildings includes Land related properties and Boundary Wall at Sites having carring value of Rs.19,914 Lakhs (March 31, 2017 Rs.25,960 Lakhs).

4. Additions to Plant & Equipments includes Net Foreign Exchange Difference of Rs.683 Lakhs (March 31, 2017 Rs. (403) Lakhs) Capitalised during the year.

5. Property, Plant and Equipment (PPE) includes assets mortgaged as security (Refer Note No. 20.1)

6. During the year the company has disposed off CWIP of Rs.NIL for Rs.NIL (March 31, 2017 Rs.1,224 Lakhs for Rs.1,058 Lakhs)

7. Capital Work-in-Progress includes:

Inventory of Capital goods amounting to Rs.4,192 Lakhs (March 31, 2017 Rs.8,364 Lakhs)

8. On March 1, 2018, major customer of the Company, Aircel filed for bankruptcy protection with the National Company Law Tribunal with an intent to undertake a resolution plan. The bankruptcy process is expected to take several months to complete and at this stage, it remains unclear whether any restructuring or revival would be possible and the outcome of the insolvency proceedings remains to be seen. Further, shutting down of business by R Com, SSTL and consolidation among operators Vodafone-Idea, Tata-Bharti etc. has affected telecom industry as a whole.

The Company performed an impairment test based on current expectations of the impact of the above mentioned developments on the projected cash flows from tower assets in accordance with the Indian Accounting Standard (IND AS 36 - Impairment of Assets).

The Company is predominantly in the business of providing ''''telecom towers'''' on shared basis and as such there are no separate segments. Accordingly, all these tower assets were assessed as a single Cash Generating Unit along with tenant related intangible assets in the form of customer contracts. The CGU consists of plant and machinery and leasehold improvements forming part of building as disclosed above.

The recoverable amount of the CGU is determined based on a value in use calculation using 10.75% as discount rate. The carrying cost of the CGU exceeds its value in use and accordingly, an impairment loss of Rs.142,016 lakhs was recognized during the year ended March 31, 2018.

8. Pursuant to the Scheme of Arrangement between CNIL and the Company and their respective shareholders and creditors (the âSchemeâ), the Authorised Share Capital of CNIL has been added to the Authorised Share Capital of the Company. Accordingly the Authorised Share Capital of the Company stands increased to Rs.18,00,000 Lakhs divided into 16,00,00,00,000 equity shares of Rs.10/- each and 20,00,00,000 Preference Shares of Rs.100/- each. (Refer Note No. 43)

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

11. Shares reserved for issue under options :

The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 1,174,657,402 Equity Shares (March 31, 2017 1,18,10,71,464; April 1, 2016 1,30,47,66,024) (Refer Note No. 20.4)

12. Out of total paid up capital, 9,53,64,166 equity shares allotted pursuant to compulsory conversion of Series A Bonds on maturity are not yet listed, since information regarding the Series A Bondholders was not available with the Company. In the absence of requisite information, the Company has allotted the said equity shares to Trust, created for the benefit of Series A Bondholders.

13. Equity Component of Compound Financial Instruments

Equity Component represents FCCB Series B1 & B3 Bonds compulsorily convertible into equity shares. (Refer Note No. 20.4)

14. Share Suspense Account

15. Reconstruction Reserve

Created pursuant to scheme of arrangement approved by Hon''ble High Court in earlier years. It shall be utilised as per provisions of Companies Act 2013.

16. Capital Reserve

Created On Forfeiture of Preferential Convertible Warrants. It shall be utilised as per provisions of Companies Act 2013.

17. Securities premium account

Created on conversion of Employee Stock Options Scheme , Preferential Warrants and Foreign currency convertible Bonds. It shall be utilised as per provisions of Companies Act 2013.

18. (A) Rupee Term Loans from Banks & Financial Institutions are secured as follows:

(i) Specific Charge - Secured Rupee Lenders of the erstwhile standalone Company (Rs.1,75,342 Lakhs as on March 31, 2018) and erstwhile CNIL (Rs. 2,38,509 Lakhs as on March 31, 2018) continue to have specific charge on the assets or properties of respective companies as existed on the effective date of merger i.e December 22, 2017

(ii) Personal guarantee of Mr. Manoj Tirodkar (Promoter) of Rs.1,54,470 Lakhs and sponsor support from Global Holding Corporation Private Limited (GHC) towards any shortfall in debt servicing.

(B) Foreign Currency Term Loan from Financial Institutions is secured as follows:

Specific Charge - Secured Foreign Currency Lender of erstwhile standalone Company of (Rs. 6,012 Lakhs as on March 31, 2018) will continue to have specific charge on the assets or properties of erstwhile standalone Company as existed on the effective date of merger i.e December 22, 2017.

19. The lenders had invoked Strategic Debt Restructuring (âSDRâ) in accordance with the Reserve Bank of India''s (âRBIâ) guidelines on September 20, 2016. The Company complied with all the stipulations under SDR - Issuance of equity shares to lenders so that lenders collectively hold atleast 51% of equity capital in the Company, paid monthly interest up to March 31, 2018, merger of CNIL with the Company, restructuring of Foreign Currency Convertible Bonds, steps for induction of new investor.

(iii) Rupee Term Loan from Banks having an Interest rate of 8% p.a aggregating to Rs.10,524 Lakhs are repayable only after the Final Settlement date of all the other restructured Loans i.e., June 30, 2026 as per SDR terms,.

(iv) The Foreign Currency Term Loan (included Current Maturities of Long term borrowings) is repayable in 24 equated quarterly instalments of Euro 4 Lakhs starting from June 15 , 2013 and ending on March15 , 2021. The loan carries Interest rate of 3 months Euribor 200 bps.

20. Foreign Currency Convertible Bonds (FCCBs) :

(i) During the year, the Company has issued 80,745 Zero Coupon Foreign Currency Compulsorily Convertible Bonds due on 2022 of US$ 1000 each (âSeries B1 Bonds), 86,417 Interest Bearing Convertible Bonds due on 2022 of US$ 1000 each (âSeries B2 Bondsâ) and 30,078 Zero Coupon Compulsorily Convertible due 2022 of US$ 1000 each (âSeries B3 Bondsâ) in exchange of the Existing outstanding Interest Bearing Convertible Bonds due 2017 (âSeries B Bondsâ) of US$ 167,193,000 along with redemption premium and outstanding interest on Series B Bonds, pursuant to Offering Memorandum dated October 26, 2017. Since these bonds were issued against the cashless exchange offer, the Company did not receive any proceeds from the offering of the Series B1 Bonds, Series B2 Bonds and Series B3 Bonds.

(ii) Terms and Conditions of the Series B1 Bonds:

b. The Series B1 Bonds are also convertible at the option of the holders of the Series B1 Bonds, (i) at any time from the date of issue of the Series B1 Bonds up to March 20, 2018, into equity shares at a conversion price equal to Rs.20 per share, provided however, that on occurrence of a proposed Change of Control on and from the date issue of the Series B1 Bonds till March 20, 2018, the conversion price will be reset to '' 10 per Share; or (ii) at any time after March 20, 2018, into Shares at a conversion price being the higher of (a) '' 10 per Share, or (b) Regulatory Floor Price in each case at a fixed rate of exchange on conversion of '' 65.1386 to U.S.$1.00 subject to certain adjustments as described in Terms and Conditions of Series B1 Bonds.

c. The Series B1 Bonds do not bear any interest.

(iii) Terms and Conditions of the Series B2 Bonds:

b. The Series B2 Bonds are redeemable at 100% of its principal amount on October 27, 2022 unless previously redeemed, converted or purchased and cancelled.

(iv) Terms and Conditions of the Series B3 Bonds:

a. The Series B3 Bonds are compulsorily convertible into fully paid equity shares of Rs.10 each on October 27, 2022 at a fixed rate of exchange of Rs.65.1386 to US$.1.00 subject to certain adjustments as described in Terms and Conditions of Series B3 Bonds;

b. The Series B3 Bonds are convertible at the option of the holders of the Series B3 Bonds at any time from the date of issue of the Series B3 Bonds up to the close of business on October 27, 2022 into Equity Shares at a conversion price equal to Rs.10 per Share with a fixed rate of exchange on conversion of Rs.65.1386 to U.S.$1.00, subject to certain adjustments as described in Terms and Conditions of Series B3 Bonds.

c. The Series B3 Bonds do not bear any interest.

(v) As on March 31, 2018, 80,745 Series B1 Bonds, 86, 417 Series B2 Bonds and 13,170 Series B3 Bonds were outstanding.

The Contribution to Provident Fund and Pension Fund is made to employees Provident Fund and Pension Fund managed by Provident Fund Commissioner.

Defined Benefit Plan

The employee''s Gratuity Fund Scheme, which is a defined benefit plan, is managed by the Trust maintained with Life Insurance Corporation of India [LIC]. The present value of obligation is determined based on actuarial valuation using Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for compensated absences is recognised in same manner as gratuity.

The estimates of rate of increase in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

33.1 Post receipt of Exit Notices on January 2, 2018 from Aircel Limited (âAircelâ), on March 1, 2018, Aircel surprisingly and unexpectedly filed insolvency petition before the National Company Law Tribunal, Mumbai ("NCLTâ) with an intent to undertake a resolution plan. It remains unclear whether any restructuring or revival would be possible and the outcome of the insolvency proceedings remains to be seen. The Company believes that it has binding long term contractual lock in arrangements with Aircel and accordingly as a step towards recovery of its dues, the Company has filed its claim before the Insolvency Resolution Professional (IRP) at Gurgaon against Aircel Limited. As a result of the abovementioned events and shutting down of business by R Com, SSTL, TATAs and consolidation among operators etc. the Company, during year ended March 31, 2018 has considered a provision towards receivables of Rs. 24,544 lakhs.

b) Certain Legal issues are outstanding against the Company mainly in relation to the alleged non-compliance of policies of municipal corporations, cases pending for permanent injunctions, objections by the local residents, disputes with site owners, in respect of which the amounts cannot be quantified at this stage and therefore the Contingent Liability in respect of this could not be determined.

The Company does not expect any material financial effect of the above matters under litigation.

21. The management and authorities have the power to amend financial statements in accordance with section 130 and 131 of Companies Act, 2013.

22. During the year 2008-09 the company had imported OFC (Optical Fiber Cable) on which the Custom department issued Show Cause Notice for the demand of Custom Duty of '' 93 Lakhs. The company deposited the whole amount under protest and subsequently the Commissioner granted the relief to the Company of '' 78 lakhs. As against the said order of the Commissioner, the Custom department has filed an appeal with the CESTAT, Mumbai on 11^th Oct 2010. The Company feels there will not be any further liability on this account.

23. During earlier years, as legally advised, the Company''s CENVAT credit aggregating to Rs.7,993 Lakhs was utilized for discharging service tax liability of CNIL, an erstwhile Associate, which has been now merged with the Company. CNIL also paid the same to the Service Tax Authority under Voluntary Compliance Encouragement Scheme (VCES) in November, 2013. Subsequently, the Company filed a writ petition in High Court of judicature at Mumbai for seeking restoration of this cenvat credit and based on the Mumbai High court direction, CESTAT passed the order in March 2015 for allowing the Company to restore the said amount as Cenvat credit. The Service tax authorities have filed an appeal with the High court challenging the CESTAT order passed in March 2015. The Company has been advised that there will not be any outflows in this regard.

24. lecommunication Towerâ is exigible to Property Tax and the State can levy property tax on Mobile Towers. While deciding the Special Leave Petition (SLP) for Mumbai Corporations matters, the Hon''ble Supreme Court had given liberty to agitate the issue with regard to the retrospective operation of assessment/demand of tax and the quantum thereof before the appropriate forum.

Post the Judgment of Hon''ble Supreme Court on January 2017, the Company had challenged the quantum of property tax and other issues before the Bombay High Court. By an order dated April 18, 2017, Bombay High Court dismissed the appeal.

Against the said order, the Company preferred a SLP with regards to the manner, quantum, component of property tax and other issues. The same was heard on January 25, 2018 and the Hon''ble Supreme Court was pleased to issue a notice to Municipal Corporation & also directed Municipal Corporations to maintain status quo. If the contention of the Company is finally accepted by the Hon''ble Supreme Court, there is a possibility that the entire demands of Corporation may have to be set aside and Corporation may require to issue entirely fresh demands. The said matter is still pending before Supreme Court and the next date for hearing has been fixed on July 5, 2018. Also with respect to the few sites where demand notices for property tax have been received, the Company has contested the demands by filing writ petitions in appropriate Courts for the assessment of property tax demand / retrospective levy of property tax, procedure and quantum that have been demanded. Various Hon''ble High Courts passed an order not to take any coercive action till the admission of matter.

25. BUSINESS COMBINATION

The scheme of Arrangement for the merger of CNIL with the Company (the scheme) has been approved by the National Company Law Tribunal (âNCLTâ) at Mumbai and National Company Law Tribunal (âNCLTâ) at Chennai vide their orders dated December 15, 2017 and December 13, 2017 respectively. Upon the filing of these orders with the Registrar of Companies, Mumbai and Registrar of Companies, Chennai the scheme became effective from December 22, 2017 having the appointed date April 1, 2016. The scheme has been accounted under the pooling of interest method with effect from appointed date as per the above mentioned NCLT orders and accordingly the comparatives for the previous year have been restated. Further, the financial statements as of the first day of the previous year i.e. April 1, 2016 have also been presented as per Ind AS 1 âPresentation of Financial Statementsâ. In terms of the scheme, the Company''s investment (through Tower Trust) in CNIL stands cancelled and 7,58,88,19,117 equity shares of '' 10 each fully paid up have been allotted to the other shareholders of CNIL as on January 27, 2018 in the ratio of 1 (one) Equity Share of Rs.10 each fully paid-up in the Capital of the Company for every 1 (one) fully paid-up Equity Share held in CNIL. All assets and liabilities of CNIL as at April 1, 2016 have been taken over at their existing book values. The debit balance of reserves of '' 341,273 lakhs pertaining to CNIL and Tower Trust, as appearing in the financial statements of CNIL and Tower Trust as on April 1, 2016 is aggregated with the corresponding balance appearing in the financial statements of the Company. There is no difference between the amount recorded as investment in the books of the Company and the amount of share capital of CNIL. The expenses in relation to the merger including stamp duty charges have been charged to the Statement of profit & loss Account.

CNIL was also in the business of sharing passive telecom infrastructure comprising of shelters, DG sets battery, towers etc which are capable of hosting active network components of various technologies of the customers.

26. As per Ind AS 24, the disclosure of transactions with the related parties are given below:

a) List of Related Parties and relationships:

I) Key Management Personnel

Mr. Manoj G. Tirodkar, Chairman (upto August 17, 2018)

Mr. Milind K. Naik, Whole Time Director

Mr. Laxmikant. Y. Desai, Chief Financial Officer, up to December 31, 2017

Mr. Bhupendra J. Kiny, Chief Financial Officer, w.e.f. January 1, 2018

Mr. Nitesh A. Mhatre, Company Secretary

* Weighted average number of equity shares is the number of equity shares outstanding at the beginning of the year including shares issued and to be issued to the holders of foreign currency compulsorily convertible bonds, adjusted by the number of equity shares issued to the CDR Lenders, multiplied by the time weighting factor. Earnings per share for the previous year have been computed after considering the shares issued to the shareholders of Chennai Network Infrastructure Limited (CNIL).

The effect of Foreign Currency Optionally Convertible Bonds on the Earnings per Share is anti-dilutive and hence, the same is not considered for the purpose of calculation of dilutive Earning per Share.

27. DETAILS OF LOANS GIVEN, INVESTMENT MADE AND GUARANTEES GIVEN, COVERED U/S 186(4) OF THE COMPANIES ACT, 2013.

Details of Investments made are given in note no.44

28. DEFERRED TAX

28.1 Reconciliation of tax expenses and the accounting profit multiplied by domestic tax rate

Since the Company has incurred loss during the year 2017-18, previous year 2016-17 and 2015-16 and no tax is payable for these years as per provisions of Income Tax Act, 1961 and no deferred tax assets is recognised, the calculation of effective tax rate is not relevant and hence, not given.

29. FAIR VALUES

Set out below, is the carrying amounts and fair value of the Company''s financial assets and liabilities that are recognised in the financial statements

b) The carrying amounts of the following financial assets and financial liabilities are a reasonable approximation of their fair values.

Accordingly, the fair values of such financial assets and financial liabilities have not been disclosed separately

i) Financial Assets:

- Trade Receivables

- Cash and Cash equivalents

- Bank balances other than cash and cash equivalents

- Loans & advances to related parties

- Security Deposits

ii) Financial Liabilities:

- Trade Payables

- Other current liabilities

- Borrowings

- Customer Deposits

Fair Valuation techniques used to determine fair value

The Company maintains procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included at the amount 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.

The following methods and assumptions were used to estimate the fair values:

i. The fair value of investments in unlisted equity and Preference shares is determined using Net Asset Value (NAV) method.

ii. Fair Value of mutual fund are reported as per Net Asset Value

iii. The fair values of non-current loans/Borrowings and security deposits are calculated based on Discounted Cash Flows technique (DCF) using a current lending rate relevant to the instrument

v. Fair Value of financial instruments measured at amortised cost such as Deposits, Borrowings, etc are approximate to their Carrying values.

30. FAIR VALUE HIERARCHY

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation techniques: -

Level 2:- Inputs, other than quoted prices included within level 1, that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). It includes fair value of the financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on the Group specific estimates. If all significant inputs required to fair value an instrument are observable then instrument is included in level 2.

31. SEGMENT REPORTING

The Company is predominantly in the business of providing âTelecom Towersâ on shared basis and as such there are no separate reportable segments. The Company''s operations are only in India.

Revenues from operation includes Rs.1,66,054 Lakhs (previous year Rs.1,43,296 Lakhs) aggregate amount of revenue from five customers (previous year three customers) , contributing each one of them to more than 10% of total revenue of the company.

These revenues are attributed to the Revenue from Telecom / Network Infrastructure Facilities & energy reimbursements.

32. FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES:

The Company''s principal financial liabilities comprise loans and borrowings including Interest thereon, Trade payables, Capex Creditors, deposits from Customers and others Financial Liabilities. The main purpose of these financial liabilities is to finance the Company''s operations, including Tower upgradation projects under implementation. The Company''s principal financial assets include Investments, Deposits, loans and advances, receivables and cash and bank balances that are derived directly from its operations.

The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below.

1) Market Risk

Note:

(i) Above exposure does not include exposure towards Foreign Currency Compulsory Convertible bonds

(ii) Amounts in INR are at the closing exchange rates at the year end.

(iii) Amounts reported above are at actuals while same are measured at amortised cost in the financial statements

c) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Company''s fixed rate long term borrowings carry step up interest rate with a predetermined yield rate which is fixed throughout the tenor of the borrowings, whereas floating rate long Term Borrowing is exposed to market rate fluctuations.

In order to manage this risk exposure, management keeps a portfolio mix of fixed & floating interest rate Debts in the total portfolio of financial instruments.

d) Foreign Currency Risk

Foreign currency risk is managed by effective foreign risk management policy based on risk perception of the management

Foreign Risk sensitivity:

The following table demonstrates the sensitivity in the USD & Euro to Indian Rupees with all other Variable held constant. The effect on loss before tax due to foreign exchange rate fluctuation:

e) Commodity Price Risk

The Company invests on upgradation of its tower assets which includes purchases of A class items like Battery banks, Diesel Generators, SMPS and other electrical items. The prices of these items fluctuate based on the prices of its raw material which in case of battery bank is Lead prices. Further, Company consumes Diesel and Electricity for running its tower sites. These rates for Diesel and Electricity fluctuate based on central and state policies. Company has entered into contracts with the Customers for recovery of Diesel and Electricity Expenses. These contracts are linked with actual Diesel and Electricity Rates thus resulting in natural hedging.

Commodity price risk is managed by effective risk management policy with help of company''s Supply Chain Management Team and Central Purchasing Committee based on risk perception.

2) Credit Risk

Trade Receivables

Further, in the recent times, the Company has been adversely affected by significant headwinds in telecom sector such as Aircel''s decision to file for voluntary insolvency, shutting down of business by Rcom, SSTL etc, sector consolidation among operators etc. It remains unclear whether any restructuring or revival would be possible and the outcome of the insolvency proceedings remains to be seen. The Company believes that it has binding long term contractual lock in arrangements with Aircel and accordingly as a step towards recovery of its dues, the Company has filed its claim before the Insolvency Resolution Professional (IRP) at Gurgaon against Aircel Limited thereby claiming Rs.1,70,520 lakhs in case Aircel revives and Rs.13,43,863 lakhs in case Aircel goes into liquidation. However, as Aircel is now before NCLT and the Company is an unsecured operational creditor, it remains to be seen what residual value would be left for distribution after appropriation by the secured banks/lenders.

The Company, as a part of its risk management plan, has proactively taken various measures to ensure smooth operations and contracted network time for remaining customers which would enable the Company to keep the credit risk at moderate level. The Company has also obtained rolling advances & security deposits from its customers which in turn mitigate the credit risk to that extent.

Financial instruments and Bank deposits

The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which its balances and deposits are maintained. Generally, the balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations

3) Liquidity Risk

Liquidity risk is that the company will not be able to settle or meet its obligation on time or at reasonable price. Company''s principal sources of liquidity are cash flows generated from its operations including deposits and advances received from customers as a part of its MSA signed. In view of recent telecom sector developments affecting the Company, various steps have been initiated by the Company to ensure that liquidity risk remains at low level.

During previous few years, all telecom companies faced increased pressure on earnings and financing fronts. The Supreme Court of India verdict for cancellation of 122 telecom licenses caused troubles for tower companies, adversely impacting their financing and fund raising plans. Further, in the recent times, the Company has been adversely affected by significant headwinds in telecom sector such as Aircel''s decision to file for voluntary insolvency, shutting down of business by Rcom, SSTL etc, sector consolidation among operators etc. It remains unclear whether any restructuring or revival would be possible and the outcome of the insolvency proceedings remains to be seen. The Company believes that it has binding long term contractual lock in arrangements with Aircel and accordingly as a step towards recovery of its dues, the Company has filed its claim before the Insolvency Resolution Professional (IRP) at Gurgaon against Aircel Limited thereby claiming Rs.1,70,520 lakhs in case Aircel revives and Rs.13,43,863 lakhs in case Aircel goes into liquidation. However, as Aircel is now before NCLT and the Company is an unsecured operational creditor, it remains to be seen what residual value would be left for distribution after appropriation by the secured banks/lenders.

The Company, in these circumstances, has proactively taken various steps to ensure smooth operations and contracted network uptime for remaining customers, namely Vodafone, Idea, Jio, Bharti Airtel, BSNL etc. These steps include realignment of debt with revised cash flows, reduction in fixed/semi variable costs including wages, electricity and diesel charges, operations and maintenance charges, ground rent etc. Towards this end, the Company is in the process of re-negotiating its arrangements with existing vendors. These steps are expected to enable the Company to remain EBITDA positive during the turnaround phase.

Despite telecom sector challenges, which are akin to force majeure events, during pre-SDR and also SDR period, the Company continues to service its Rupee Term Loans in accordance with SDR terms. Hence there was no financial default by the Company as on March 31, 2018. In view of the abovementioned developments options to right size the debt either through an ARC debt sale process initiated by lenders or in accordance with the revised RBI guidelines dated February 12, 2018 are being envisaged.

33. Capital Management

For the purpose of the company''s capital management, capital includes issued equity capital, convertible foreign currency bonds, securities premium, all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company''s capital management is to ensure continuity of the operating activities of the Company.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2018, March 31, 2017 and March 31, 2016.

34. The lenders had invoked Strategic Debt Restructuring (âSDRâ) in accordance with the Reserve Bank of India''s (âRBIâ) guidelines on September 20, 2016. The Company complied with all the stipulations under SDR i.e. Issuance of equity shares to lenders so that lenders collectively hold more than 51% of equity capital in the Company, paid monthly interest up to March 31, 2018, merger of CNIL with the Company, restructuring of Foreign Currency Convertible Bonds, steps for induction of new investor. Despite telecom sector challenges, which are akin to force majeure events, during pre-SDR and also SDR period, the Company continues to service its Rupee Term Loans in accordance with SDR terms. Hence there was no financial default by the Company as on March 31, 2018. Pursuant to the Reserve Bank of India''s circular dated February 12, 2018 SDR guidelines are withdrawn. However, in view of the recent sector developments, options to right size the debt either through an ARC debt sale process initiated by lenders or in accordance with the revised RBI guidelines dated February 12, 2018 are being envisaged. The Company continues to prepare the financial statements on a going concern basis.

35. In the opinion of the Management, Non-Current/Current Assets, Loans and Advances are approximately of the value stated if realised in the ordinary course of the business.

Mar 31, 2017

NOTE - 1 CORPORATE INFORMATION

GTL Infrastructure Limited (GIL) is domiciled and incorporated in India under the provision of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange and National Stock Exchange of India. The registered office of the Company is located at Global Vision, 3rd Floor, Electronic Sadan II, MIDC TTC Industrial Area, Mahape, Navi Mumbai- 400 710, India.

The Company is in the business of passive infrastructure sharing which is based on building, owning, operating and maintaining passive telecom infrastructure sites capable of hosting active network components of various technologies of multiple telecom operators as well providing energy management solutions .

These Financial Statements were approved for issue by the Board of Directors on April 27, 2017.

NOTE - 2 BASIS OF PREPARATION AND PRESENTATION

The financial statements of the Company have been prepared on a going concern basis in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015.

For all periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). The Companyâs first Ind AS compliant financial statements are for the year ended March 31, 2017 with restated comparative figures for the year ended March 31, 2016 and as on April 1, 2015 in compliance with Ind AS. The date of transition is April 1, 2015. Refer Note 53 for detailed information on first time adoption of Ind AS.

The financial statements have been prepared on a historical cost basis, except for the following assets and liabilities which have been measured at fair value:

- Certain financial assets and liabilities measured at fair value

- Defined Benefit Plans- measured at Fair Value

The preparation of the financial statements requires management to make estimates and underlying assumptions. Actual results could vary from these estimates. The estimated and underlying assumptions are reviewed on an ongoing basis. Revisions to Accounting estimates are recognised in the period in which the estimates are revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future years.

The Companyâs financial statements are presented in Indian Rupees (?) which is its functional and presentation currency.

All values are rounded off to the nearest lakhs (100,000), except when otherwise indicated.

3(A) Significant accounting judgements, estimates and assumptions

The preparation of the Companyâs financial statements requires management to make judgement, estimates and assumptions that affect the reported amount of revenue, expenses, assets and liabilities and the accompanying disclosures. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

a) Depreciation and useful lives of property plant and equipment

Property, plant and equipment are depreciated over the estimated useful lives of the assets, after taking into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation to be recorded during any reporting period. The useful lives and residual values are based on the Companyâs historical experience with similar assets and take into account anticipated technological changes. The depreciation for future periods is adjusted if there are significant changes from previous estimates.

b) Recoverability of trade receivable:

Judgements are required in assessing the recoverability of trade receivables and determining whether a provision against those receivables is required. Factors considered in assessing the recoverability of trade receivables include the credit rating of the counterparty, the amount and timing of anticipated future payments and any possible actions that can be taken to mitigate the risk of non-payment.

c) Provisions:

Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability require the application of judgement to existing facts and circumstances, which can be subject to change. Since the cash outflows can take in the future years, the carrying amounts of provisions and liabilities are reviewed regularly and adjusted to take account of changing facts and circumstances.

d) Impairment of non-financial assets:

The Company assesses at each reporting date whether there is an indication that an asset may be impaired.

If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the assetâs recoverable amount. An assetâs recoverable amount is the higher of an assetâs or CGUâs fair value less costs of disposal and its value in use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transaction are taken into account, if no such transactions can be identified, an appropriate valuation model is used.

e) Impairment of financial assets

The impairment provisions for financial assets are based on assumptions about risk of default and expected cash loss. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on Companyâs past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

f) Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and other post-employment benefits and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

g) Fair value measurement of financial instruments

When the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the Discounted Cash Flow (DCF) model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

h) Taxes

Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable income together with future tax planning strategies. The Company does not expect availability of future taxable income sufficient to utilise its deferred tax assets. Further details on taxes are disclosed in note 46.

i) Asset retirement obligations

The Company has recognised a provision for asset retirement obligations associated with telecommunication towers. Such Provision is recognised in respect of dismantling of infrastructure equipment and restoration of sites under operating leases, the costs for which are expected to be incurred at the end of the lease term, based on the estimate provided by the internal technical experts. In determining the fair value of such provision, assumptions and estimates are made in relation to discount rates, the expected cost to dismantle and remove the plant from the site and the expected timing of those costs.

The Company estimates that the costs would be incurred at the end of the lease term and calculates the provision using the DCF method based on the discount rate that approximates interest rate of risk free borrowings and current estimate of asset retirement obligation duly adjusted for expected inflationary increase in related costs.

3.1 Buildings include properties having carrying value of Rs.572 Lakhs (March 31, 2016 Rs.583 Lakhs ; April 1, 2015 Rs.734 Lakhs) for which deeds of conveyance have yet to be executed in favour of the Company and Rs.0.07 Lakhs towards cost of 70 shares of Rs.100 each in a Co-operative Housing Society.

3.2 Buildings include of Rs.10,407 Lakhs (March 31, 2016 Rs.12,904 Lakhs ; April 1, 2015 Rs.15,473 Lakhs) towards Land related properties and Boundary Wall at Sites.

3.3 Additions to Plant & Equipments includes Net Foreign Exchange Difference of Rs. (403 Lakhs) (March 31, 2016 Rs.623 Lakhs ; April 1, 2015 Rs.(1,378 Lakhs) Capitalised during the year.

3.4 In accordance with Ind AS 36 on âImpairment of Assetsâ as notified by the Companies (Indian Accounting Standards) Rules 2015 , The Management during the year carried out an exercise of identifying the assets that may have been impaired in respect of each cash generating units in accordance with the said Accounting Standard. On the basis of this review carried out by the management, there was no impairment loss on PPE during the year ended March 31, 2017.

3.5 Property, Plant and Equipment (PPE) includes assets mortgaged as security (Refer Note No. 18.1)

3.6 The carrying value (Gross Block less accumulated depreciation) as on 1st April, 2015 of the Property, Plant and Equipment is considered as a deemed cost on the date of transition.

3.7 During the year the Company has disposed off CWIP of Rs.1,242 Lakhs for Rs.1,076 Lakhs (March 31, 2016 Rs.681 Lakhs for Rs.634 Lakhs ; April 1, 2015 Rs.1,435 Lakhs for Rs.959 Lakhs )

3.8 Capital Work-in-Progress includes:

Capital Goods of Inventory amounting to Rs.4,332 Lakhs (March 31, 2016 Rs.4,566 Lakhs ; April 1, 2015 Rs.5,399 Lakhs)

4.1 âThe Company is the sole beneficiary in the Tower Trust and has contributed Rs.1,81,572 Lakhs towards the Corpus of the said Trust. The Trust has invested the aforesaid amount in an Associate âChennai Network Infrastructure Ltd.â (CNIL) a special purpose vehicle (SPV) and holds 1,81,57,22,400 Equity Shares of Rs.10 each (Previous year 1,81,57,22,400) representing 27.53% (Previous Year 27.53%) of total issued and paid up Equity Share Capital of CNIL as on March 31,2017. Although CNIL has incurred cash losses and its net worth has been substantially eroded, as per the management, the Companyâs equity interest in the Associate based on its business plans as on March 31, 2017 support the carrying value of such investment. The Company considers its above investment as strategic and long term in nature. Management believes, decline in the value of its long term investment in Associate is of temporary in nature and hence no provision for diminution in value of the above investment is considered necessary.â

4.2 The fair values of the Companyâs financial guarantee obligations are determined by using DCF method using Rate of commission at which guarantees would have been issued for unrelated parties and Incremental Borrowing Rate.

5.1 Terms/rights attached to equity shares

5.2 Shares reserved for issue under options :

The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 1,18,10,71,464 Equity Shares (March 31, 2016 1,30,47,66,024 ; April 1, 2015 1,31,60,07,039) (Refer Note No. 18.3)

Nature and purpose of Reserves

6.1 Reconstruction Reserve

Created pursuant to scheme of arrangement approved by Honâble High Court in earlier years. It shall be utilised as per provisions of Companies Act 2013.

6.2 Capital Reserve

Created On Forfeiture of Preferential Convertible Warrants. It shall be utilised as per provisions of Companies Act 2013.

6.3 Securities premium account

Created on conversion of Employee Stock Options Scheme , Preferential Warrants and Foreign currency convertible Bonds. It shall be utilised as per provisions of Companies Act 2013.

6.4 Equity Component of Compound Financial Instruments

Series A Bonds of USD 111,740,000 are compulsorily convertible into equity shares. As these Bonds are compulsorily Convertible, they are considered as other Equity as per IND (AS) 109 and disclosed as âEquity Component of Compound Financial Instrumentsâ. It will be transfer to Share Capital as per the terms of Series A bonds.

6.5 Foreign Currency Monetary Item Translation Difference Account

Unamortised part of Exchange difference on account of re-instatement of Series B Bonds

7.1 (A) Rupee Term Loans from Banks & Financial Institutions are secured byway of

(i) Mortgage by first pari-passu charge on all immovable assets, both present and future and on all movable assets, both present and future, including first floating charge on all the current assets of the Company.

(ii) Sponsor support from Global Holding Corporation Private Limited (GHC) and guarantee of Mr. Manoj Tirodkar (Promoter) towards debt servicing of CDR Lenders and personal guarantee aggregating to Rs.60,104 Lakhs by Mr. Manoj Tirodkar

(B) Foreign Currency Term Loan from Financial Institutions is secured by way of Mortgage by first pari-passu charge on all immovable assets, both present and future and on all movable assets, both present and future, including first floating charge on all the current assets of the Company.

7.2 Terms of Repayment

(i) Rupee Term Loans from Banks and Financial Institutions and Current Maturities of Long-term borrowings having an effective yield of 10.75% over the tenure of the facility aggregating to Rs.2,99,864 Lakhs are repayable in 37 structured quarterly instalments ending on June 30, 2026

The Maturity Profile of these loans is as set below:

(ii) Rupee Term Loans from Banks having an Interest rate of 8% p.a aggregating to Rs.21,087 Lakhs are repayable only after the Final Settlement date of all other restructured Loans, i.e., June 30, 2026.

(iii) The Foreign Currency Term Loan and Current Maturities of Long term borrowings relating to Foreign Currency Term Loan are repayable in 24 equated quarterly instalments of Euro 4 Lakhs starting from June 15 , 2013 and ending on March15 , 2021. The loan carries Interest rate of 3 months Euribor 200 bps.

7.3 Foreign Currency Convertible Bonds (FCCBs) :

(i) In terms of Offering Circular dated October 17, 2012 (âOffering Circularâ), on November 8, 2012 outstanding Foreign Currency Convertible Bonds (FCCBs) of USD 228,300,000 together with premium of USD 90,986,000 on them aggregating to USD 319,286,000 were restructured by way of cashless exchange with 111,740 Zero Coupon Compulsorily Convertible Bonds due 2017 (Series A) and 207,546 Interest Bearing Convertible Bonds due 2017 (Series B) of USD 1,000 each.

(ii) Series A and Series B Bondholders have an option to convert these bonds into equity shares at a fixed exchange ratio of 1 USD=Rs.54.252 at any time upto the Close of Business on November 2, 2017 (âMaturity Dateâ) except during the âclosed periodâ as defined in the âOffering Circularâ.

(iii) Series A Bonds of USD 111,740,000 are compulsorily convertible into equity shares. Each Series A bond is convertible into 5425.20 fully paid up equity shares of Rs.10 each. As on March 31, 2017, 24,168 Series A Bonds were outstanding. As these Bonds are compulsorily Convertible, they are considered as other Equity as per IND (AS) 109 and disclosed as âEquity Component of Compound Financial Instrumentsâ (Refer Note No. 17).

(iv) The Series B Bonds of USD 207,546,000 are interest bearing optionally convertible bonds. Each bond carries an Interest at the rate of 0.5335% p.a. payable semi annually on the outstanding principal plus the margin for period under consideration with effect from November 8, 2013 as defined in Offering Circular. The Conversion Price shall be determined in terms of âOffering Circularâ. As on date, applicable Conversion Price for each Bond is Rs.10 per equity share, accordingly Series B Bondholder have an option to convert each bond into 5,425.20 fully paid up equity shares of Rs.10 each. As on March 31, 2017, 1,93,533 Series B Bonds were outstanding.

(v) Unless previously converted, redeemed, repurchased or cancelled, the Company will redeem each Series B Bond at 114.5047% of its principal amount on the maturity date i.e November 9, 2017.

7.4 The details of overdue Principal and interest payable as at March 31, 2017 is as follows:

7.5 The Board of Directors of the Company (âBoardâ) had, in its meeting held on September 19, 2016, recommended the invocation and implementation of the Strategic Debt Restructuring Scheme (âSDR Schemeâ) for the Company. The CDR lenders of the Company, at a meeting of the Joint Lender Forum (âJLFâ) held on September 20, 2016, have also unanimously agreed to invoke the SDR Scheme for the Company having September 20, 2016 as the âreview and reference dateâ. Accordingly, âStand Stillâ clause is applicable for asset classification. Pending final approval of SDR, the Company continues to account for interest obligation for various credit facilities as per the terms of CDR. (Refer Note No. 51)

8.1 Salaries and Allowances include remuneration paid to Whole Time Director of Rs.50 Lakhs (previous year Rs.50 Lakhs) which is subject to approval of Central Government.

8.2 Employee Benefits:

As per Indian Accounting Standard 19 âEmployee Benefitsâ the disclosures as defined in the IND AS are given below:

Defined Benefit Plans

The employeeâs Gratuity Fund Scheme, which is a defined benefit plan, is managed by the Trust maintained with Life Insurance Corporation of India [LIC]. The present value of obligation is determined based on actuarial valuation using Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for compensated absences is recognised in same manner as gratuity.

The estimates of rate of increase in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

g. Sensitivity Analysis

9. The management and authorities have the power to amend financial statements in accordance with section 130 and 131 of companies Act, 2013.

10. During the year 2008-09 the company had imported OFC (Optical Fiber Cable) on which the Custom department issued Show Cause Notice for the demand of Custom Duty of ''. 93 Lakhs. The company deposited the whole amount under protest and subsequently the Commissioner granted the relief to the Company of Rs.78 lakhs. As against the said order of the Commissioner, the Custom department has filed an appeal with the CESTAT, Mumbai on 11th Oct 2010. The Company feels there will not be any further liability on this account.

11. During earlier years, as legally advised, the Companyâs CENVAT credit aggregating to Rs.7,993 Lakhs was utilised for discharging service tax liability of Chennai Network Infrastructure Limited, an Associate, which is in the process of merger with the Company.

CNIL also paid the same to the Service Tax Authority under Voluntary Compliance Encouragement Scheme (VCES) in November, 2013. Subsequently, the Company filed a writ petition in High Court of judicature at Mumbai for seeking restoration of this cenvat credit and based on the Mumbai High court direction, CESTAT passed the order in March 2015 for allowing the Company to restore the said amount as Cenvat credit. The Service tax authorities have filed an appeal with the High court challenging the CESTAT order passed in March 2015. The company has been advised that there will not be any outflows in this regard.

12. The Honâble Supreme Court vide its order dated December 16, 2016 upheld that âMobile Telecommunication Towerâ is a building and the State can levy property tax as envisaged in entry 49 of the list II of the seventh schedule of the Constitution of India, while deciding the Special Leave Petition (SLP) filed by various Municipal Corporations and the State of Gujarat against the order of the Divisional Bench of Gujarat High Court. Another SLP filed by one of the customers of the Company against the Corporation (in which an associate company of the Company is also a party) for the similar matter is still pending before the Honâble Supreme Court and is expected to be heard shortly.

In respect of few sites where demand notices for property tax have been received, the Company has contested the demands in certain cases by filing writ petitions in appropriate Courts for the assessment of property tax demand / retrospective levy of property tax, itâs procedure and quantum, that have been demanded for in respect of which the Honâble High Court passed an order not to take any coercive action till the admission of matter. In respect of majority of the sites, the Company has so far not received any such demand. Further, as per the Master Service Agreements / Arrangements executed with certain customers the property tax if any, paid by the Company is to be recovered from them.

In view of the pending matter before the Honâble Supreme Court and other courts, absence of any demand for majority of the towers and also the Companyâs right to recover the property tax amounts from certain customers, the Company is unable to quantify the amount of property tax, if any, to be borne by it and accordingly no provision for the same can be made at this stage and the same will be recognized as and when the matter is settled.

13. Scheme of Amalgamation

The Company continues to pursue the merger process of Chennai Network Infrastructure Limited (CNIL) with itself. The Joint Lenders Forum (JLF) along with the invocation of SDR has also resolved that the merger process currently being pursued by the Company be done simultaneously along with the SDR process. Further, the Board of Directors of the Company in its Meeting held on April 22, 2017 has considered and approved the Scheme of Amalgamation between CNIL and the Company having the appointed date as April 01, 2016, subject to necessary approvals from various statutory authorities and tribunal/court. Upon the Scheme becoming effective, 1 fully-paid Equity Share of Rs.10 of the Company will be issued for every 1 fully-paid up Equity Share of CNIL and the Companyâs investment in CNIL through trust will stand cancelled.

14. AS PER IND AS 24, THE DISCLOSURE OF TRANSACTIONS WITH THE RELATED PARTIES ARE GIVEN BELOW:

a) List of Related Parties and relationships

I) Subsidiary

Tower Trust

II) Associate

Chennai Network Infrastructure Limited

III) Key Management Personnel

Manoj G. Tirodkar, Chairman

Mr. Milind K. Naik, Whole Time Director

Mr. Laxmikant. Y. Desai, Chief Financial Officer

IV) Others

GTL Limited (GTL)

Global Holding Corporation Pvt Ltd

b) Transactions during the year with related parties

Transactions with Related Parties at Arms Length Price

15. The stagnant telecom industry has been, of late, witnessing several opportunities for growth. This turnaround was largely due to fresh tenancy rollouts due to new 2G /3G /4G /LTE spectrum auctioned in last couple of years. The recent entry of new incumbent operator has already started generating significant opportunities for business growth. The Company believes that it would be able to secure significant share in the incremental tenancies. As mentioned in note no. 51, subsequent to the year end, the Companyâs debt liability has been substantially reduced due to conversion of debt into equity share capital and the Company is also in the process of restructuring its FCCBs respectively. Besides, the continuing measures taken by the Company in terms of cost rationalization and renegotiation of MSAs have benefited the Company with improved cash flows, streamlined revenues and reduction of delays in collection cycle. In view of the above, the Company continues to prepare its financial statements on a going concern basis.

NOTE - 16 Details of loans given, investment made and Guarantees given, covered U/S 186(4) of the Companies Act, 2013

- Details of Loans given are given in note no.12

- Investment made in Tower Trust is for strategic purpose (refer note no. 4)

- Corporate Guarantees have been issued on behalf of Associate company, details of which are given in related party transactions (refer note no. 42)

NOTE - 17 DEFERRED TAX

17.1 Reconciliation of tax expenses and the accounting profit multiplied by domestic tax rate:

Since the Company has incurred loss during the year 2016-17, previous year 2015-16 and 2014-15 and no tax is payable for these years as per provisions of Income Tax Act, 1961 and no deferred tax assets recognised, the calculation of effective tax rate is not relevant and hence, not given.

17.2 Deferred tax liabilities / (Assets) relates to the following:

17.3 Amount and expiry date of unused tax losses for which no deferred tax asset is recognised:

NOTE - 18 FAIR VALUES

Set out below, is a comparison by class of the carrying amounts and fair value of the Companyâs financial assets and liabilities that are recognised in the financial statements

a) Financial Assets measured at fair value through profit or loss:-

b) Financial Assets measured at amortised cost:

c) Financial Assets measured at amortised cost:

d) The carrying amounts of the following financial assets and financial liabilities are a reasonable approximation of their fair values.

Accordingly, the fair values of such financial assets and financial liabilities have not been disclosed separately

i) Financial Assets:

- Trade Receivables

- Cash and Cash equivalents

- Bank balances other than cash and cash equivalents

- Loans & advances to related parties

ii) Financial Liabilities:

- Trade Payables

- Other current liabilities

Fair Valuation techniques used to determine fair value

The following methods and assumptions were used to estimate the fair values:

i) The fair value of investments in unlisted equity shares is determined using Net Asset Value (NAV) method.

ii) Fair Value of mutual fund are reported as per Net Asset Value

iii) The fair values of non-current loans/Borrowings and security deposits are calculated based on Discounted Cash Flows technique (DCF) using a current lending rate relevant to the instrument.

iv) The fair values of the Companyâs financial guarantee obligations are determined by using DCF method using Rate of commission at which guarantees would have been issued for unrelated parties and Incremental Borrowing Rate. Appropriate weightage has been assigned to discount factor for counterparty non-performance risk.

v) Fair value of trade receivable, cash and cash equivalents, other bank balances, trade payables, loans and other financial assets and liabilities are approximate to their carrying amounts largely due to the short-term maturities of these instruments.

vi) The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

NOTE - 19 FAIR VALUE HIERARCHY

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation techniques:-

Level 2:- Inputs, other than quoted prices included within level 1, that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). It includes fair value of the financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on the Group specific estimates. If all significant inputs required to fair value an instrument are observable then instrument is included in level 2.

NOTE - 20 FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES

The Companyâs principal financial liabilities comprise loans and borrowings including Interest thereon, Trade payables, Capex Creditors, deposits from Customers and others Financial Liabilities. The main purpose of these financial liabilities is to finance the Companyâs operations, including Tower upgradation projects under implementation. The Companyâs principal financial assets include Investments, Deposits, loans and advances, receivables and cash and bank balances that are derived directly from its operations.

The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

1) Market Risk

Market risk is the risk that the fair value of future cash flows of financial assets will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial Instrument affected by market risk includes loans and borrowings, deposits and derivative financial instruments.

As the revenues from companyâs tower business are dependent on the sustainability of Telecom sector, Company believes that macro-economic factors, including the growth of Indian economy, interest rates as well as political & economic environment, have a significant direct impact on companyâs business, results of operations & financial positions.

a) Interest Rate Exposure profile appended in the table below

b) Foreign Currency Exposure that are not hedged by derivative instruments is as follows

c) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Companyâs fixed rate long term borrowings carry step up interest rate with a predetermined yield rate which is fixed throughout the tenor of the borrowings, whereas floating rate long Term Borrowing is exposed to market rate fluctuations.

In order to manage this risk exposure, management keeps a portfolio mix of fixed & floating interest rate Debts in the total portfolio of financial instruments.

Interest rate sensitivity:

With all other variable held constant the following table reflects the impact of borrowing cost on floating rate portion of total Debt:

d) Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companyâs exposure to the risk of changes in foreign exchange rates relates primarily to the Companyâs borrowings related to its foreign currency convertible bonds & foreign currency loan.

Foreign currency risk is managed by effective foreign risk management policy based on risk perception of the management

Foreign Risk sensitivity:

The following table demonstrates the sensitivity in the USD & Euro to Indian Rupees with all other Variable held constant. The effect on loss before tax due to foreign exchange rate fluctuation:

e) Commodity Price Risk

The Company invests on upgradation of its tower assets which includes purchases of A class items like Battery banks, Diesel Generators, SMPS and other electrical items. The prices of these items fluctuate based on the prices of its raw material which in case of battery bank is Lead prices. Further, Company consumes Diesel and Electricity for running its tower sites. These rates for Diesel and Electricity fluctuate based on central and state policies. Company has entered into contracts with the Customers for recovery of Diesel and Electricity Expenses. These contracts are linked with actual Diesel and Electricity Rates thus resulting in hedging.

Commodity price risk is managed by effective risk management policy with help of companyâs Supply Chain Management Team and Central Purchasing Committee based on risk perception.

2) Credit Risk

Trade Receivables

To manage this, Company periodically assesses the financial reliability of its customers, taking into account the current economic trend, business challenges, historic trend of payments, bad debts & ageing of accounts receivables. The Company provides Passive Telecom Infrastructure to Telecom Operators in India. During previous few quarters, all telecom companies faced increased pressure on earnings and financing fronts. The Supreme Court of India verdict for cancellation of 122 telecom licenses caused troubles for tower companies, adversely impacting their financing and fund raising plans. However, the risk is currently assessed at moderate level.

The Company, as a part of its risk management plan, has also obtained rolling advances & security deposits from its customers which in turn mitigate the credit risk to that extent.

Financial instruments and Bank deposits

The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which its balances and deposits are maintained. Generally, the balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations.

3) Liquidity Risk

Liquidity risk is that the company will not be able to settle or meet its obligation on time or at reasonable price. Companyâs principal sources of liquidity are cash flows generated from its operations including deposits and advances received from customers as a part of its MSA signed.

During the last few years, the telecom industry has been adversely affected by the general economic slowdown and various other factors such as slower growth of 3G technology; failure of spectrum auctions and inflationary costs of power & fuel. This has resulted into substantial erosion of the Companyâs net worth The Company continues to take various measures such as cost optimisation, improving operating efficiency, renegotiation of contracts with customers to improve Companyâs operating results and cash flows. Further, the management believes that new spectrum auction will result in exponential growth in 3G 4G & LTE which are expected to generate incremental cash flows to the Company.

As a result of the uncertainties prevailing in the Telecom sector, operators are reluctantly incurring capital expenditure which directly affects the Companyâs tenancies growth vis-a-vis Revenues.

The below table summarises the maturity profile of the companyâs financial liability based on contractual undiscounted cash flows

NOTE - 21 CAPITAL MANAGEMENT

For the purpose of the companyâs capital management, capital includes issued equity capital, convertible foreign currency bonds, securities premium, all other equity reserves attributable to the equity holders of the Company. The primary objective of the Companyâs capital management is to ensure continuity of the operating activities of the Company.

In order to achieve this overall objective, the Companyâs capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements.

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2017 and March 31, 2016.

NOTE - 22 POST REPORTING EVENTS

Due to various adverse developments in telecom sectors including the cancellation of 2G licenses since implementation of CDR package, which were beyond management control, there was material adverse impact in the achievement of the CDR projections. While the Company had been able to meet its repayment obligations till June 30, 2016 out of its cash accruals and realization from current assets, in view of the substantial developments as aforesaid which have had a significant impact on the financial performance of the Company, the Company was facing challenges towards its debt repayment obligations. The Board of Directors of the Company at its meeting held on September 19, 2016, had recommended the invocation and implementation of the SDR Scheme for the Company. The CDR lenders of the Company, at a meeting of the Joint Lenders Forum (ââJLFââ) held on September 20, 2016, unanimously agreed to invoke the Strategic Debt Restructuring Scheme (ââSDR Schemeââ) for the Company having September 20, 2016 as the âreview and referenceâ date. Accordingly ââstand stillââ clause is applicable for asset classification. Subsequent to the year end, all the CDR lenders approved the SDR Scheme and as on April 13, 2017 outstanding debts aggregating to Rs.169,222 lakhs have been converted into 1,69,22,15,807 Equity Shares of Rs.10 each at par resulting into reduction of Companyâs debt liability by the equivalent amount. The management believes that subsequent to conversion, the debt levels of the Company are expected to be at sustainable levels barring unforeseen event.

NOTE - 23 FIRST TIME ADOPTION OF IND AS

These financial statements, for the year ended March 31, 2017, are the first financial statements of the Company prepared in accordance with Ind AS.

For periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP), including the Accounting Standards notified under the relevant provisions of the Companies Act, 2013 as adopted consistently by the Company. The Company has prepared financial statements which comply with Ind AS applicable for year ending on March 31, 2017 together with the comparative yearly data as at and for the year ended March 31, 2016, as described in the summary of significant accounting policies. In preparing these financial statements, the Companyâs opening balance sheet was prepared as at April 1, 2015, the Companyâs date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP s, including the Balance Sheet as at April 1, 2015 and the financial statements as at and for the year ended March 31, 2016.

Exemptions applied

Ind AS 101 allows certain exemptions from the retrospective application of certain requirements under Ind AS.

Optional exemptions:

Deemed cost

The Company has elected to measure items of Property, plant , equipment and intangible assets at its carrying value on the transition date as deemed cost.

Lease Exemption

The Company has used Ind AS 101 exemption and assessed all arrangements for determining whether they contain lease based on facts and circumstances prevailing as at the transition date i.e. April 1, 2015.

Asset retirement obligation

Ind AS 101 provides an exemption for changes that occurred before the date of transition to Ind AS and prescribes an alternative treatment if the exemption is used. Asset retirement obligation is measured in accordance with Ind AS 37 at the date of transition to Ind AS. To the extent the liability is within the scope of Ind AS 16, estimated liability that would have been included in the cost of related asset should be discounted by using best estimate of the historical risk adjusted discount rate(s) over the intervening period and calculate the accumulated depreciation on that amount, as at the date of transition to Ind ASs, on the basis of the current estimate of the useful life of the asset, using the depreciation policy adopted by the entity in accordance with Ind ASs. The Company has elected to use this exemption.

Long Term Foreign Currency Monetary Item

The Company has opted to continue the policy adopted for accounting for exchange differences arising from translation of long term foreign currency monetary items recognised in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period as per the previous GAAP.

Foot Notes to reconciliation

1) Foreign currency convertible bonds (FCCBs)

FCCB Series A are classified as compound financial instrument. The fair value of the liability component is determined to be NIL and thus entire liability of Series A bonds is reclassified as equity and presented under âOther equityâ.

FCCB Series B are fair valued on initial recognition and carried at amortised cost after considering the transaction cost and redemption premium. The redemption premium adjusted in the securities premium under Indian GAAP has been reversed under Ind AS. Consequently, the foreign currency loss recognised in the Foreign Currency Monetary Item Translation Difference Account (FCMITDA) has been adjusted. Subsequently, amortized cost to be calculated based on EIR.

2) Property, Plant and Equipment:

The Company obtains land for its ground based towers or space for roof top towers / poles, generally on lease. At the end of the lease term, the Company would incur dismantling and restoration costs i.e. asset retirement obligation (ARO). As per Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets, liability towards this obligation is recorded at a present value of expected cost towards dismantling and restoration. The estimated future cash outflows are discounted at a current pre tax rate that reflects the risk specific to the decommissioning liability. The unwinding of the discount is expensed as incurred and recognized in the statement of profit and loss as finance cost. Changes in the estimated future cost or in the discount rate applied are added to or deducted from the cost of the asset. Subsequently, Changes in the ARO liability resulting merely from the passage of time (accretion of the discounted liability) should be recognized as an increase in the carrying amount of the liability and corresponding interest cost is charged off to the statement of profit & loss.

3) Security Deposits to Landlords:

Under the previous GAAP, interest free lease security deposits given to the landlords (that are refundable on completion of the lease term) are recorded at their transaction value. Under Ind AS, all financial assets are recognised at fair value. Accordingly, the Company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value has been recognised as prepaid rent. Subsequently, prepaid rent will be amortized on straight line basis & Unwinding of Interest would be recorded to make fair value of the deposits equal to the amount of Deposit, over the lease term.

4) Security Deposits from Customers:

Under the previous GAAP, interest free lease security deposits taken from the customers (that are refundable on completion of the lease term) were recorded at their transaction value. Under Ind AS, all financial assets are recognised at fair value. Accordingly, the Company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value has been recognised as Advance Revenue. Subsequently, Advance Revenue will be amortized on straight line basis & Unwinding of Interest expense would be recorded to make fair value of the deposits equal to the amount of Deposit, over the non-cancellable lease term.

5) Merger Expenses:

Under Ind AS, acquisition related costs in relation to the business combination such as advisory, legal, accounting, valuation fees, etc. needs to be recorded in the Statement of Profit and Loss in the year in which they are incurred.

6) Borrowings

Under Indian GAAP, transaction costs incurred in connection with borrowings are amortised upfront and charged to profit or loss for the period. Under Ind AS, transaction costs are included in the initial recognition amount of financial liability and charged to profit or loss using the effective interest method. Further the borrowings under CDR are fair valued on the date of restructuring and subsequently, shall be carried at amortized cost based on EIR method.

7) Investments in Mutual Funds

Under Ind AS, investments in mutual funds are required to be classified as Fair Value Through Profit or Loss (FVTPL). Accordingly, investment in mutual funds is measured at fair value at each reporting date.

8) Financial Guarantee Obligation(FGO)

Under Ind As, FGO is required to be initially recorded at fair value. Such obligation shall be amortized in the statement of profit and loss on a straight line basis

9) Actuarial Gains/losses

Gains/losses through remeasurements of net defined benefit liabilities/asset are recognized in other comprehensive income.

10) Statement of Cash Flows

The Ind AS impacts are either Non-cash adjustments or are regrouping among the cash flows from operating, investing and financing activities. Consequently, Ind AS adoption has no impact on the net cash flow for the year ended March 31, 2016 as compared with the previous GAAP

NOTE - 24 In the opinion of the Management, Non Current/Current Assets, Loans and Advances are approximately of the value stated if realised in the ordinary course of the business

NOTE - 25 Segment Reporting

The Company is predominantly in the business of providing âTelecom Towersâ on shared basis and as such there are no separate reportable segments. The Companyâs operations are only in India.

Mar 31, 2016

1. Terms/rights attached to equity shares

2. Shares reserved for issue under options :

The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 1,304,766,024 Equity Shares (Previous Year 1,316,007,039) (Refer Note No. 4.3)

3. (A) Rupee Term Loans from Banks & Financial Institutions are secured by way of

(ii) Sponsor support from Global Holding Corporation Private Limited (GHC) and guarantee of Mr. Manoj Tirodkar (Promoter) towards debt servicing of CDR Lenders and personal gurantee aggregating to Rs.6,010,400,000 by Mr. Manoj Tirodkar.

(B) Foreign Currency Term Loan from Financial Institutions is secured by way of

Mortgage by first pari-passu charge on all immovable assets, both present and future and on all movable assets, both present and future, including first floating charge on all the current assets of the Company.

4. Terms of Repayment

(i) Rupee Term Loans from Banks and Financial Institutions and Current Maturities of Long-term borrowings having an effective yield of 10.75% over the tenure of the facility aggregating to Rs.30,071,939,059 are repayable in 41 structured quarterly installments ending on June 30, 2026

(iii) Rupee Term Loans from Banks having an Interest rate of 8% p.a aggregating to Rs.2,112,179,389 are repayable only after the Final Settlement date of all other restructured Loans, i.e., June 30, 2026.

(iv) The Foreign Currency Term Loan and Current Maturities of Long term borrowings relating to Foreign Currency Term Loan are repayable in 24 equated quarterly installments of Euro 375,000 starting from June 15, 2013 and ending on March15, 2021. The loan carries Interest rate of 3 months Euribor 200 bps.

5. Foreign Currency Convertible Bonds (FCCBs) :

(ii) Series A and Series B Bondholders have an option to convert these bonds into equity shares at a fixed exchange ratio of 1 USD = Rs.54.252 at any time up to the Close of Business on November 2, 2017 (âMaturity Dateâ) except during the ''closed period'' as defined in the ''Offering Circular''.

(iv) The Series B Bonds of USD 207,546,000 are interest bearing optionally convertible bonds. Each bond carries an Interest at the rate of 0.5335% p.a. payable semi annually on the outstanding principal plus the margin for period under consideration with effect from November 8, 2013 as defined in Offering Circular. The Conversion Price shall be determined in terms of ''Offering Circular''. As on date, applicable Conversion Price for each Bond is Rs.10 per equity share, accordingly Series B Bondholder have an option to convert each bond into 5,425.20 fully paid up equity shares of Rs.10 each. As on March 31, 2016, 193,533 Series B Bonds were outstanding.

(v) Unless previously converted, redeemed, repurchased or cancelled, the Company will redeem each Series B Bond at 114.5047% of its principal amount on the maturity date i.e November 9, 2017.

6. Based on the latest available informationâs of the Investee companies, the book value per share is considerably less than cost. As a matter of prudence diminution in the value of investments of Rs.332,500,000 (Previous Year Rs.278,302,500) has been considered.

7. The Company is the sole beneficiary in the Tower Trust and has contributed Rs.18,157,224,000 towards the Corpus of the said Trust. The Trust has invested the aforesaid amount in an Associate âChennai Network Infrastructure Ltd.â (CNIL) a special purpose vehicle (SPV) and holds 1,815,722,400 Equity Shares of Rs.10 each (Previous year 1,815,722,400) representing 27.53% (Previous Year 27.53%) of total issued and paid up Equity Share Capital of CNIL as on March 31, 2016. Although CNIL has incurred cash losses and its net worth has been substantially eroded, as per the management, the Company''s equity interest in the Associate based on its business plans as on 31st March, 2016 support the carrying value of such investment. The Company considers its above investment as strategic and long term in nature. Management believes, decline in the value of its long term investment in Associate is of temporary in nature and hence no provision for diminution in value is of the above investment is considered necessary.

8. Refer Note No. 1 (viii) for basis of valuation

Note - 9. EXCEPTIONAL ITEMS:

The telecom scenario in the Country changed drastically since the beginning of year 2012 due to cancellation of 122 2G licenses by the Hon''ble Supreme Court, slower 2G & 3G growths, failure of spectrum auctions and general economic slowdown. During this time, the Company which was mandated to support the planned deployment of 20,000 tenancies of Aircel/ CNIL could not do so since Aircel was unable to honour its commitment. In the meanwhile, the Company had already placed orders on various vendors to procure tower assets and made advances against those orders. Consequently, the Company had to short close its commitment to vendors and has already taken appropriate steps against them for recovery of these advances. However, as a matter of prudence, provision for doubtful advances of Rs.1,011,298,354 has been considered during the year ended March 31, 2016. (Previous year Rs.587,466,114 lacs net after adjusting Rs.1,500,000,000 received from Aircel Group of Companies) Further, the Company evaluated its non current investments for the purpose of determination of potential diminution in value based on the latest available information of the investee companies. Based on such evaluation, the Company has recognized a provision for diminution of Rs.54,197,500 during the year ended March 31, 2016. (Previous year Rs.278,302,500). Both the abovementioned items have been disclosed as exceptional items in the Statement of Profit and Loss.

Note - 10

During the year 2008-09 the company had imported OFC (Optical Fiber Cable) on which the Custom department issued Show Cause Notice for the demand of Custom Duty of Rs.9,294,731.The company deposited the whole amount under protest and subsequently the Commissioner granted the relief to the Company of Rs.7,794,792. As against the said order of the Commissioner, the Custom department has filed an appeal with the CESTAT, Mumbai on 11th Oct 2010. The Company feels there will not be any further liability on this account.

Note - 11

During earlier years, as legally advised, the Company''s CENVAT credit aggregating to Rs.799,256,619 was utilized for discharging service tax liability of Chennai Network Infrastructure Limited, as Associate, which is in the process of merger with the Company. CNIL has paid the same to the Service Tax Authority under Voluntary Compliance Encouragement Scheme (VCES) in November, 2013. The Company had already filed a writ petition in High Court of judicature at Mumbai for seeking restoration of this cenvat credit. Based on the Mumbai High court direction, CESTAT passed the order in March 2015 for allowing the Company to restore the said amount as Cenvat credit. The Service tax authorities have filed a appeal with the High court challenging the CESTAT order passed in March 2015. The company has been advised that there will not be any outflows in this regard.

Note - 12 CAPITAL COMMITMENTS:

Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) as at March 31, 2016 is Rs.205,948,293 (Previous year Rs.165,048,290) Cash outflow is expected on execution of such contracts on progressive basis.

Note - 13

The Company has entered into a Master Services Agreement (MSA) with respective Telecom Operators for a tenure up to 15 years. Invoices are raised on these operators for provisioning fees and recovery of pass through expenses as part of the said MSA. The amounts outstanding from certain operators are subject to confirmation/under reconciliation. The management is of the view that all the outstanding trade receivables and energy recoverable are good for recovery except for which provision has already been made.

Note - 14

The Scheme of arrangement between the Company and Chennai Network Infrastructure Limited (CNIL) under section 391 to 394 of Companies Act, 1956 was approved by the Hon''ble High Court of Judicature of Bombay but is pending for approval before Hon''ble High Court of Judicature of Madras. Consequent upon restructuring due to CDR, the above scheme is being modified, subject to the approval of all competent authorities and stakeholders.

Note - 15

Over the last few years, the Telecom Operators were forced to review their business models. This was either due to regulatory issues like cancellation of 2G License by the Hon''ble Supreme Court of India, failure of spectrum auctions, inflationary input costs and/or consequent realigning of their own business needs by the Telcos. This resulted in slower 3G roll outs and therefore had its impact on the Company''s revenues and profitability.

Whilst it continues to be under CDR for the past few years, the Company had been able to maintain good relations with all its stakeholders where each one have lent support from time to time. Since the last year, this stagnant industry has been witnessing several opportunities for growth. This turnaround was largely due to positive outcome of the new 2G /3G /4G / LTE spectrum (auctioned in early 2015) and the immediate rollouts made by some of these Telcos (including new entrants). The Company has been able to secure a fair share of business from these incremental tenancies. Similarly, the huge Network Rollout plans of our customers (including that of the new entrants) over the next few years starting now would further continue to assist the Company in securing additional tenancies from these customers. The Company has already put in place plans to improve its overall tenancy ratio and has implemented several other measures to support the evolving needs of its customers.

Further, many customers have already supported the Company by renegotiation and rationalization of existing MSAs/Contracts resulting into streamlining of cash flows, improved revenues, and reduction of delays in collection cycle. This has helped the Company to improve its overall cash position with better margins. Various other cost rationalization measures continuously undertaken by the Company have also resulted in improvement of operations'' efficiency.

The Company, for the reasons stated above, continues to prepare its financial statements on a going concern basis though its net worth is fully eroded and has incurred cash losses

Note - 16 OPERATING LEASE

The Company''s significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements.

Note - 17

In the opinion of the Management, Non Current/Current Assets, Loans and Advances are approximately of the value stated, if realized in the ordinary course of business.

Note - 18

In accordance with regulation 34(3) of the Securities and Exchange Board of India (listing obligations and disclosure requirements) regulations, 2015, the details of Loans and Advances are as under:

a. To Chennai Network Infrastructure Limited (CNIL), an Associate, closing balance as on March 31, 2016 is Rs.389,389,447 (Previous year Rs.65,313,541). Maximum balance outstanding during the year was Rs.657,207,189 (Previous year Rs.2,265,493,079).

b. CNIL has not made investment in the shares of the Company.

c. As per the Company''s policy loans to employees are not considered for this clause.

Note - 19

The previous year''s figures, wherever necessary, have been regrouped, reclassified and rearranged to make them comparable with those of the current year.

Based on annual weighted average Note:

Due to fluctuation in conversion rate, the figures for current financial year mentioned in US$ Mn. are not truly comparable with those of previous year. The Exchange rates for FY 2014-15 are as per last annual report.

SEGMENT-WISE PERFORMANCE

The Company is predominantly in the business of providing ''Telecom Towers'' on shared basis and as such there are no separate reportable segments.²

Foreign exchange differences are excluded for calculation of EBITDA.

Depreciation, Amortization and Impairment Expenses etc.

The Depreciation, Amortization and Impairment for FY 2015-16 was Rs.250.67 Crore (US$ 37.72 Mn.) as compared to Rs.255.99 Crore (US$ 41.43 Mn.) in FY 2014-15.

Impairment of Assets & Exceptional Items

The carrying amount of assets is reviewed at each Balance Sheet date if there is any indication of³ By the year 2020, the BRICs are expected to account for nearly 50% of all global GDP growth. Securing a strong base in these countries will be critical for investors seeking growth beyond them.

The Indian perspective

- As per the Ministry of Statistics and Programme Implementation (MOSPI), Consumer Price Index CPI in India increased to 126 Index Points in March 2016 from 125.90 Index Points in February 2016. Consumer Price Index (CPI) in India averaged 108.86 Index Points from 2011 until 2016, reaching an all time high of 126.60 Index Points in November of 2015 and a record low of 86.81 Index Points in February of 2011.

Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the board to take up steps in this matter;

Formulate suitable policies and systems for implementation, take appropriate decisions and monitor implementation of the following Regulations:

a. SEBI (Prohibition of Insider Trading) Regulations, 2015 and

b. SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to the Securities Market) Regulations, 2003.

- Perform such other functions consistent with applicable regulatory requirements.

iii) Number of Nomination & Remuneration Committee Meetings held and the dates on which held: The

Nomination & Remuneration Committee met five (5) times during the year under review on May 6, 2015, August 19, 2015, November 5, 2015, February 4, 2016 and February 25, 2016. The necessary quorum was Net of amount deposited under protests

viii. Based on our audit procedures and information and explanations given by the management, and considering the Corporate Debt Restructuring (CDR) scheme and other restructuring schemes with foreign lender and FCCB

Mar 31, 2015

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

2. Shares reserved for issue under options :

The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 1,316,007,039 Equity Shares (Previous Year 1,207,031,848) (Refer Note No. 4.3)

3. A] Rupee Term Loans from Banks & Financial Institutions are secured by way of

(i) Mortgage by first pari-passu charge on all immovable assets, both present and future and on all movable assets, both present and future, including first floating charge on all the current assets of the Company.

(ii) Sponsor support from Global Holding Corporation Private Limited (GHC) and guarantee of Mr. Manoj Tirodkar (Promoter) towards debt servicing of CDR Lenders and personal guarantee aggregating to Rs. 6,010,400,000 by Mr. Manoj Tirodkar.

B] Foreign currency Term Loan from financial institution is secured by way of

Mortgage by first pari-passu charge on all immovable assets, both present and future and on all movable assets, both present and future, including first floating charge on all the current assets of the Company.

4. Terms of Repayment

(i) Rupee Term Loans from Banks and Financial Institutions and Current Maturities of Long-term borrowings having an effective yield of 10.75% over the tenure of the facility aggregating to Rs. 30,300,579,754 are repayable in 45 structured quarterly instalments ending on June 30, 2026

(ii) Rupee Term Loans from Banks and Financial Institutions and Current Maturities of Long-term borrowings having an Interest rate of 3% p.a. aggregating to Rs. 1,583,665,324 are repayable in 8 structured quarterly instalments ending on March 31,2017

(iii) Rupee Term Loans from Banks having an Interest rate of 8% p.a. aggregating to Rs. 2,112,179,389 are repayable only after the Final Settlement date of all other restructured Loans, i.e., June 30, 2026.

(iv) The Foreign Currency Term Loan and Current Maturities of Long term borrowings relating to Foreign Currency Term Loan are repayable in 24 equated quarterly instalments of Â 375,000 ending on March 15, 2021. The loan carries Interest rate of 3 months Euribor 200 bps.

5. Foreign Currency Convertible Bonds (FCCBs) :

(i) In terms of Offering Circular dated October 17, 2012 ("Offering Circular"), on November 8, 2012 outstanding Foreign Currency Convertible Bonds (FCCBs) of US$ 228,300,000 together with premium of US$ 90,986,000 on them aggregating to US$ 319,286,000 were restructured by way of cashless exchange with 111,740 Zero Coupon Compulsorily Convertible Bonds due 2017 (Series A) and 207,546 Interest Bearing Convertible Bonds due 2017 (Series B) of US$ 1,000 each.

(ii) Series A and Series B Bondholders have an option to convert these bonds into equity shares at a fixed exchange ratio of 1 US$=' 54.252 at any time upto the Close of Business on November 2, 2017 ("Maturity Date") except during the 'closed period' as defined in the 'Offering Circular'.

(iii) Series A Bonds of US$ 111,740,000 are compulsorily convertible into equity shares. Each Series A bond is convertible into 5425.20 fully paid up equity shares of Rs. 10 each. As on March 31,2015, 49,040 Series A Bonds were outstanding.

(iv) The Series B Bonds of US$ 207,546,000 are interest bearing optionally convertible bonds. Each bond carries an Interest at the rate of 0.5335% p.a. payable semi annually on the outstanding principal plus the margin for period under consideration with effect from November 8, 2013 as defined in Offering Circular. The Conversion Price shall be determined in terms of 'Offering Circular'. As on date, applicable Conversion Price for each Bond is Rs. 10 per equity share, accordingly Series B Bondholder have an option to convert each bond into 5,425.20 fully paid up equity shares of Rs. 10 each. As on March 31,2015, 193,533 Series B Bonds were outstanding.

(v) Unless previously converted, redeemed, repurchased or cancelled, the Company will redeem each Series B Bond at 114.5047% of its principal amount on the maturity date i.e. November 9, 2017.

6. Salaries and allowances include remuneration to Whole Time Director Rs. 4,970,616 (Previous year Rs. 4,970,616) which is subject to the approval of Central Government.

7. Employee Benefits:

Defined Benefit Plan

The employee's Gratuity Fund Scheme, which is a defined benefit plan, is managed by the Trust maintained with Life Insurance Corporation of India [LIC]. The present value of obligation is determined based on actuarial valuation using Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for compensated absences is recognised in same manner as gratuity.

(i) The telecom scenario in the Country changed drastically since the beginning of year 2012 due to cancellation of 122 2G licenses by the Hon'ble Supreme Court, slower 2G & 3G growths, failure of spectrum auctions and general economic slowdown. During this time, the Company which was mandated to support the planned deployment of 20000 tenancies of Aircel / CNIL could not do so since Aircel was unable to honour its commitment. In the meanwhile, the Company had already placed orders on various vendors to procure tower assets and made advances against those orders. Consequently, the Company had to short close its commitment to vendors and is currently pursuing legal action against them for recovery of these advances. However, as a matter of prudence, a provision for doubtful advances of Rs. 2,087,466,114 (Previous year Rs. 600,000,000) has been made during the year ended March 31, 2015. Further, pursuant to the settlement agreement between the Company, CNIL and Aircel Group of Companies Rs. 1,500,000,000 (Previous year Nil) has been recognised as income towards final settlement during the year ended March 31,2015. The above amounts have been shown as exceptional items.

(ii) The Company evaluated its non current investments for the purpose of determination of potential diminution in value based on the latest available financial statements of the investee companies. Based on such evaluation, the Company has recognised a provision for diminution as on March 31,2015 amounting to Rs. 278,302,500. The above mentioned amount has been shown as exceptional item.

8. Contingent Liabilities:

A] (Amount in Rs.)

Sr. As at As at No. Particulars March March 31,2015 31,2014

Contingent Liabilities not provided for (No Cash Outflow is expected)

i. Bank Guarantees 21,775,642 19,346,614 (Bank Guarantees are provided under contractual / legal obligation)

ii. Corporate Guarantee 8,310,000,00 8,310,000,000 (Given to Banks and Financial Institution for loans taken by the erstwhile subsidiary company)

iii. Claims against the Company not 160,562,890 106,029,485 acknowledged as debts

iv. Disputed liability in respect of - 1,402,120,217 Service Tax Matters under appeal

v. Disputed liability in respect of 122,586,058 73,892,075 Sales Tax Matters under appeal (Amount deposited Rs. 21,186,705) (Previous Year Rs. 21,008,127)

B]

Certain Legal issues outstanding against the Company relating majorly to alleged non-compliance of policies of municipal corporations,levy of taxes,cases pending for permanent injunctions,objections by local residents,disputes with site owners,where the disputed amounts are non-quantifiable and therefore contingent liability in respect of this could not be determined.

The Company has not expect any material financial effect of the above matters under litigation.

During the year 2008-09 the Company had imported OFC (Optical Fiber Cable) on which the Custom department issued Show Cause Notice for the demand of Custom Duty of Rs. 9,294,731. The Company deposited the whole amount under protest and subsequently the Commissioner granted the relief to the Company of Rs. 7,794,792. As against the said order of the Commissioner, the Custom department has filed an appeal with the CESTAT, Mumbai on 11th Oct 2010. The Company feels there will not be any further liability on this account.

9. Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) as at March 31,2015 is Rs. 165,048,290 (Previous year Rs. 1,006,680,790) Cash outflow is expected on execution of such contracts on progressive basis.

10. The Company has entered into a Master Services Agreement (MSA) with respective Telecom Operators for a tenure upto 15 years. Invoices are raised on these operators for provisioning fees and recovery of pass through expenses as part of the said MSA. Retention of amounts by certain operators for the earlier periods was resultant upon different interpretations of MSA. Subject to confirmation/reconciliation of balances, Provision towards doubtful trade receivables & energy recoverable of Rs. 727,109,570 (Previous year Rs. 255,185,342) has been made during the year ended March 31, 2015 for such receivables on a prudent basis, in respect of which, the Company will continue to pursue for its recovery. The management is of the view that all the outstanding trade receivables & energy recoverables are good for recovery except for which provision has already been made.

11. The Scheme of arrangement between the Company and Chennai Network Infrastructure Limited (CNIL) under section 391 to 394 of Companies Act, 1956 was approved by the Hon'ble High Court of Judicature of Bombay but is pending for approval before Hon'ble High Court of Judicature of Madras. Consequent upon restructuring due to CDR, the above scheme is being modified, subject to the approval of all competent authorities and stakeholders

12. During the last few years, the telecom industry has been adversely affected by the general economic slowdown and various other factors such as slower growth of 3G technology; failure of spectrum auctions and inflationary costs of power & fuel. This has resulted into substantial erosion of the Company's net worth and the Company has incurred cash losses. The Company continues to take various measures such as cost optimisation, improving operating efficiency, renegotiation of contracts with customers to improve Company's operating results and cash flows. Further the management believes that new spectrum auction will result in exponential growth in 3G 4G & LTE which are expected to generate incremental cash flows to the Company. Based on the Master Services Agreement executed for passive infrastructure sharing with Reliance Jio, one of the operators with BWA spectrum preparing to launch 4G services Pan India, the Company has already commenced roll outs for it. In view of the above mentioned factors, the Company continued to prepare its Financial Statements on going concern basis.

13. Segment Reporting:

The Company is predominantly in the business of providing "Telecom Towers" on shared basis and as such there are no separate reportable segments. The Company's operations are only in India.

14. Related Party Disclosures:

A. Related Parties

I. Trust

Tower Trust (the Company is the sole beneficiary)

II. Associates

Chennai Network Infrastructure Limited (CNIL)

III. Key Managerial Personnel

a. Mr. Manoj G. Tirodkar (Chairman)

b. Mr. Milind Naik, Whole-time Director

c. Mr. L.Y. Desai (Chief Financial Officer)

IV. Others

a. GTL Limited (GTL)

b. Global Holding Corporation Pvt Ltd

15. Particulars of foreign currency exposures that are not hedged by derivative instruments as at March 31,2015

a) Receivables- Rs. 1,011,298,354 (Previous year Rs. 1,011,298,354)

b) Payables- Rs. 16,393,300,001 (Previous year Rs. 15,882,678,732)

16. Operating Lease

The Company's significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements.

17. In the opinion of the Management, Non Current / Current Assets, Loans and Advances are approximately of the value stated, if realised in the ordinary course of business.

18. In accordance with clause 32 of Listing Agreement the details of Loans and Advances are as under:

a. To Chennai Network Infrastructure Limited (CNIL), an Associate, closing balance as on March 31, 2015 is Rs. 65,313,541 (Previous year 2,265,493,079). Maximum balance outstanding during the year was Rs. 2,265,493,079 (Previous year Rs. 3,391,395,602).

b. CNIL has not made investment in the shares of the Company.

c. As per the Company's policy loans to employees are not considered for this clause.

19. The previous year's figures, wherever necessary, have been regrouped, reclassified and rearranged to make them comparable with those of the current year.

Mar 31, 2014

Note -1

Pursuant to the Company''s application to the appropriate Income Tax Authorities for AY 2005-06 to AY 2012-13, orders have been received during the year. As per these orders, net income tax payable relating to earlier years aggregating to Rs. 8,870,435 has been provided for and Rs. 447,516,712 has been accounted as Income Tax Refund receivable.

Note - 2 Contingent Liabilities:

(Amount in Rs.)

Sr. As at As At Particulars No. March 31,2014 March 31,2013

Contingent Liabilities not provided for (No Cash Outflow is expected)

i Bank Guarantees 19,346,614 20,130,206

(Bank Guarantees are provided under contractual / legal obligation)

ii. Corporate Guarantee 8,310,000,000 10,810,000,000

(Given to Banks and Financial Institution for loans taken by the erstwhile subsidiary company)

iii. Claims against the Company not acknowledged as debts 106,029,485 44,504,728

IV Disputed liability in respect of Service Tax Matters under appeal 1,402,120,217 -

V Disputed liability in respect of Sales Tax Matters under appeal (Amount 73,892,075 91,317,125 deposited Rs. 21,008,127) (Previous Year Rs. 31,899,647)

Note - 3 During the year 2008-09 the Company had imported OFC (Optical Fiber Cable) on which the Custom department issued Show Cause Notice for the demand of Custom Duty of Rs. 9,294,731/- The Company deposited the whole amount under protest and subsequently the Commissioner granted the relief to the Company of Rs. 7,794,792/-. As against the said order of the Commissioner, the Custom department has filed an appeal with the CESTAT, Mumbai on October 11,2010. The Company feels there will not be any further liability on this account.

As at March 31,2014, the Company has Net Deferred Tax Assets of Rs. 3,099,548,323. In The absence of virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised, the same has not been recognised in the books of accounts in line with Accounting Standard 22 dealing with "Accounting for taxes on Income".

Note - 4 Particulars of foreign currency exposures that are not hedged by derivative instruments as at 31st March 2014

a) Receivables- Rs. 1,011,298,354 (Previous year Rs. 1,011,298,354)

b) Payables- Rs. 15,882,678,732 (Previous year Rs. 14,387,442,124)

Note - 5 Operating Lease

The Company''s significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements.

Note - 6 In the opinion of the Management, Non Current/Current Assets, Loans and Advances are approximately of the value stated, if realised in the ordinary course of business.

Note - 7 In accordance with clause 32 of Listing Agreement the details of Loans and Advances are as under:

a. To Chennai Network Infrastructure Limited (CNIL), an Associate, closing balance as on March 31,2014 is Rs. 2,265,493,079 (Previous year Rs. 3,376,164,755). Maximum balance outstanding during the year was Rs. 3,391,395,602 (Previous year Rs. 3,376,164,755).

b. CNIL has not made investment in the shares of the Company.

c. As per the Company''s policy loans to employees are not considered for this clause.

Note - 8 The previous year''s figures, wherever necessary, have been regrouped, reclassified and rearranged to make them comparable with those of the current year.

Mar 31, 2013

1.1 a. On February 12'' 2007 and February 27'' 2007'' the Company granted 7''490''000 Options ("Grant 2Â) and 25''000 Options ("Grant 3Â)'' both'' convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 29.81 per share.

On October 9'' 2007'' with a view to compensate the Option holders considering the Rights Issue'' the Exercise Price of the Options in respect of ("Grant 2Â) and ("Grant 3Â) was re-fixed to Rs. 19.90 per share in place of Rs. 29.81 per share.

b. On October 9'' 2007'' the Company granted 650''000 Options ("Grant 4(A)Â)'' convertible into Equity Shares of Rs.10 each at an exercise price of Rs. 26.48 per share.

c. On October 9'' 2007'' the Company also granted 249''000 Options ("Grant 4 (B)Â)'' convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 26.48 per share.

d. On October 9'' 2007'' with a view to compensate the Option holders considering the Rights Issue'' the Company has granted-

Rs. 1''007''500 Options ("Grant 5Â) at the exercise price of Rs. 10 each to ("Grant 1Â) Option holders.

Rs. 7''190''000 Options ("Grant 6Â) at the exercise price of Rs. 19.90 to ("Grant 2Â) Option holders.

Rs. 25''000 Options ("Grant 7Â) at the exercise price of Rs. 19.90 each to ("Grant 3Â) Option holders.

e. On March 11'' 2008'' the Company granted 1''700''000 Options ("Grant 8Â)'' convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 33.60 per share

f. Pursuant to approval of Shareholders in Annual General Meeting held on July10'' 2009 all the unvested Options as of April 29'' 2009 were vested on April 29'' 2009.

g. On November 23'' 2009 the Company granted 600''000 Options ("Grant 9Â) convertible into Equity Share of Rs. 10 each at an exercise price of Rs. 24.37 per share.

note - 2 contingent liabilities:

(Amount in Rs.) sr. As at As At particulars no. March 31'' 2013 March 31'' 2012

Contingent Liabilities not provided for (No Cash Outflow is expected) i. Bank Guarantees 20''130''206 25''851''074

(Bank Guarantees are provided under contractual/legal obligation) ii. Corporate Guarantee 10''810''000''000 10''810''000''000

(Given to Banks and Financial Institution for loans taken by the erstwhile subsidiary company)

iii. Claims against the Company not acknowledged as debts 44''504''728 15''234''109

iv. Premium on Foreign Currency Convertible Bonds issued nIl 4''073''033''598

v. Disputed liability in respect of Sales Tax Matter under appeal (Amount deposited Rs. 31''899''647 91''317''125 170''931''249

(Previous Year Rs. 38''869''569)

note - 3 During the year 2008-09 the Company had imported OFC (Optical Fibre Cable) on which the Custom department issued Show Cause Notice for the demand of Custom Duty of Rs. 9''294''731/- The company deposited the whole amount under protest and subsequently the Commissioner granted the relief to the Company upto amount of Rs. 7''794''792/-. As against the said order of the Commissioner'' the Custom department has filed the appeal with the CESTAT'' Mumbai on Oct 11'' 2010. The Company feels there will not be any further liability on this account.

note - 4 capital commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) as at March 31'' 2013 is Rs. 9''585''559''405 (Previous year Rs. 12''031''399''019). Cash outflow is expected on execution of such contracts on progressive basis.

note - 5 As per the Business Purchase Agreement of July 2010 between Aircel and the Company'' in order to meet their planned deployment of 20''000 contracted tenancies under Right Of First Refusal (ROFR)'' the Company had placed orders on various parties to procure tower assets. Since the beginning of year 2012'' the telecom scenario in the Country changed drastically due to cancellation of 122 2G licenses by the HonÂble Supreme Court'' slower 2G & 3G growth'' failure of spectrum auctions'' regulatory challenges and general economic downturn. As a result'' Aircel failed to honour its ROFR commitment to the Company. The telecom scenario further worsened and the Company was unable to pick up the deliveries against few of its orders. As these orders were backed by letter of credit the bank honoured the commitment aggregating to Rs. 1''332''100''863 and debited to the Company and as prescribed in the Master Restructuring Agreement (MRA) of Corporate Restructuring Debt (CDR) scheme'' the same was converted to Rupee term loan. The Company has initiated appropriate steps for recovery of the same. As a matter of prudence Rs. 1''332''100''863 has been provided and disclosed as an exceptional item in the Statement of Profit and Loss.

note - 6 The Company has entered into Master Services Agreement (MSA) with the Telecom Operators for a period of 10-15 years. Invoices are raised on these operators for provisioning fees and recovery of pass through expneses as part of the said MSA. The Company has requested for the balance confirmations from these operators and in respect of certain operators'' confirmations are still awaited.

note - 7 The board of directors of the Company'' in the earlier years'' had approved the Scheme of Arrangement (the "SchemeÂ) under Section 391 to Section 394 of the Companies Act'' 1956'' providing for the merger of "Chennai Network Infrastructure LimitedÂ (CNIL) with the Company w.e.f. August 1'' 2010 (the appointed date) subject to necessary approvals from various statutory authorities. This scheme was approved by the HonÂble Bombay High Court and approval of HonÂble Madras High Court is awaited. Pursuant to the corporate debt restructuring of the borrowings of the Company'' the Company is in the process of modifying the scheme and once the scheme is finalised'' the same will be subjected to the necessary approval of various competent authorities.

note - 8 segment Reporting:

The Company is predominantly in the business of providing "Telecom TowersÂ on shared basis and as such there are no separate reportable segments. The CompanyÂs operations are predominantly only in India.

note - 9 Related party Disclosures:

a. Related Parties

I. Trust

Tower Trust (The Company is sole beneficiary)

II. Associates

a. GTL Limited

b. Chennai Network Infrastructure Limited (subsidiary up to December 19'' 2012)

c. Global Holding Corporation Private Limited

III. Key Managerial Personnel

a. Mr. Manoj Tirodkar'' Chairman

b. Mr. Milind Naik'' Whole-Time Director & Co-COO

c. Mr. Bhupendra Kiny'' Chief Financial Officer

note - 10 particulars of foreign currency exposures that are not hedged by derivative instruments as at 31st March 2013

a) Receivables - Rs. 1''011''298''354 (Previous year Rs. 1''011''312''057)

b) Payables - Rs. 14''387''442''124 (Previous year Rs. 12''728''403''666)

note - 11 operating lease

The CompanyÂs significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements.

note - 12 In the opinion of the Management'' Non Current/Current Assets'' Loans and Advances are approximately of the value stated'' if realised in the ordinary course of business.

note - 13 In accordance with clause 32 of Listing Agreement the details of advance is as under:

a. To Chennai Network Infrastructure Limited (CNIL)'' an Associate (Subsidiary upto December 19'' 2012)'' closing balance as on March 31'' 2013 is Rs. 3''376''164''755 (Previous year 1''735''813''873). Maximum balance outstanding during the year was Rs. 3''376''164''755 (Previous year Rs. 1''735''813''873).

b. CNIL has not made investment in the shares of the Company.

c. As per the CompanyÂs policy loans to employees are not considered for this clause.

note - 14 The previous yearÂs figures'' wherever necessary'' have been regrouped'' reclassified and recast to make them comparable with those of the current year.

Mar 31, 2012

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

1.1 Shares reserved for issue under options to :

(i) The Employee Stock Option Schemes (ESOS) holders under the ESOS have the option to exercise/convert ESOS into 13,495,004 (Previous Year 13,651,804) (Refer Note No. 22.1)

(ii) The Foreign Currency Convertible Bonds (FCCB) holders have the option to convert FCCB into 169,158,948 (Previous Year 169,158,948) (Refer Note No. 4.3)

(iii) Compulsorily Convertible Debenture (CCD) holders to be allotted pursuant to the Corporate Debt restructuring package (Refer Note No. 4.4) (iv) Refer Note No. 27 in respect of shares to be issued pursuant to the Scheme of Arrangement.

1.3 Term Loans from Banks & Financial Institutions are secured by way of

(i) Mortgage by first pari-passu charge on all immovable assets, both present and future and on all movable assets, both present and future, including first floating charge on all the current assets of the Company.

(ii) Sponsor support from Global Holding Corporation Private Limited (GHC) and Mr. Manoj Tirodkar (Promoter) towards debt servicing of CDR Lenders and Personal guarantee aggregating to Rs. 6,010,400,000 by Mr. Manoj Tirodkar.

1.4 Terms of Repayment

(i) Rupee Term Loans from Banks and Financial Institutions having an effective yield of 10.75% over the tenure of the facility aggreegating to Rs. 30,189,971,635 are repayable in 53 structured quarterly instalments starting from June 30, 2013 and ending on June 30, 2026.

(iii) The Foreign Currency Term Loan includes overdue amount of Rs. 277,890,240 as on March 31, 2012. Subsequently on May 14, 2012 the terms of the loan have been amended and as per the amended terms the repayment of loans will commence only from June 15. 2013 and is accordingly repayble in 32 equated quarterly instalments of Euro 375,000 starting from June 15, 2013 and ending on March 15, 2021. The loan carries Interest rate of 3 months Euribor 200 bps.

(iv) Rupee Term Loans from Banks having an Interest rate of 8% p.a aggregating to Rs. 308,929,836 are reapayble only after the Final Settlement date of all other restructured Loans, i.e., June 30, 2026.

1.5 Zero Coupon Foreign Currency Convertible Bonds (FCCBs) :

(i) 2,283 Foreign Currency Convertible Bonds (FCCBs) of USD 100,000 each, aggregating to USD 228.30 Million were outstanding as on March 31, 2012 convertible at the option of the bondholders into Equity shares of the Company by November 22, 2012. In the event the FCCBs holders do not exercise their option by the due date, the FCCBs are redeemable at a premium of 40.4064 percent of the principal amount. The pro-rata premium as on March 31, 2012 works out to Rs. 4,073,033,598. At the time of redemption, the Company will adjust the premium on redemption to Securities Premium Account and it will not have any impact on profit or loss of the Company. Meanwhile, the Company has also initiated the process of restructuring the FCCB's.

(ii) Zero Coupon Foreign Currency Convertible Bonds (FCCBs) of USD 100,000 each are :

(a) Convertible by the bond holders at any time on and after January 27, 2008 but prior to close of business on November 22 , 2012. Each bond will be converted into fully paid up Equity Shares of Rs. 10 each at an initial Conversion Price of Rs. 53.04 per share translated from U.S. dollars at the Fixed exchange rate of Rs. 39.30 per U.S. dollar.

(b) Redeemable, in whole but not in part, at the option of the Company at any time on or after November 28, 2010 but not less than seven business days prior to maturity date subject to fulfillment of certain terms and obtaining requisite approvals.

(c) Redeemable on maturity date at 140.4064 percent of its principal amount, if not redeemed or converted earlier.

1.6 CDR Empowered Group (CDR EG) vide their letter dated December 23, 2011 ('CDR Letter') approved the Company's financial restructuring package under the corporate debt restructuring mechanism (CDR) effective from July 1, 2011. As per the above mentioned restructuring package, a part of the debts outstanding in respect of CDR lenders who have signed the agreement as on that date and CCD contribution received from promoters, aggregating to Rs. 10,994,773,700 has been disclosed as CCD Application Money in Note No. 8 "Other Current Liabilities". Further, as per the above package the balance Rupee debt of the CDR lender are repayable over the period of 15 years with a moratorium of one year nine months from the effective date carrying interest on step up basis with an effective yield of 10.75% over the tenure of the facility and payable after one year six months from the effective date. Subsequent to March 31, 2012 the Company allotted Compulsorily Convertible Debentures against the above CCD Application Money of Rs. 10,994,773,700. Further, on May 5, 2012 these CCD's have been converted into 869,839,670 equity shares of Rs. 10/- each fully paid up.

1.7 Employee Stock Option Scheme:

a. On February 12, 2007 and February 27, 2007, the Company granted 7,490,000 Options ("Grant 2") and 25,000 Options ("Grant 3"), both, convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 29.81 per share.

On October 9, 2007, with a view to compensate the Option holders considering the Rights Issue, the Exercise Price of the Options in respect of ("Grant 2") and ("Grant 3") was re-fixed to Rs. 19.90 per share in place of Rs. 29.81 per share.

b. On October 9, 2007, the Company granted 650,000 Options ("Grant 4(A)"), convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 26.48 per share.

c. On October 9, 2007, the Company also granted 249,000 Options ("Grant 4 (B)"), convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 26.48 per share.

d. On October 9, 2007, with a view to compensate the Option holders considering the Rights Issue, the Company has granted-

Rs. 1,007,500 Options ("Grant 5") at the exercise price of Rs. 10 each to ("Grant 1") Option holders.

Rs. 7,190,000 Options ("Grant 6") at the exercise price of Rs. 19.90 to ("Grant 2") Option holders.

Rs. 25,000 Options ("Grant 7") at the exercise price of Rs. 19.90 each to ("Grant 3") Option holders.

e. On March 11, 2008, the Company granted 1,700,000 Options ("Grant 8"), convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 33.60 per share.

f. Pursuant to approval of Shareholders in Annual General Meeting held on July10, 2009 all the unvested Options as of April 29, 2009 were vested on April 29, 2009.

g. On November 23, 2009 the Company granted 600,000 Options ("Grant 9") convertible into Equity Share of Rs. 10 each at an exercise price of Rs. 24.37 per share.

h. On December 09, 2009 the Company granted 5,907,850 Options ("Grant 10") convertible into Equity Share of Rs. 10 each at an exercise price of Rs. 28 per share. Out of above 156,800 Options lapsed during the year. (Previous years options lapsed 117,100).

1.8 Employee Benefits:

As per Accounting Standard 15 "Employee Benefits" the disclosure of Employee Benefit, as defined in Accounting Standard are given below: Defined Contribution Plan

Defined Benefit Plan :

The employee's Gratuity Fund Scheme, which is a defined benefit plan, is managed by the Trust maintained with Life Insurance Corporation of India [LIC]. The present value of obligation is determined based on actuarial valuation using Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for compensated absences is recognised in same manner as gratuity.

Note - 2 Contingent Liabilities

(Amount in Rs.)

Sr. As at As at Particulars No. March 31, 2012 March 31, 2011

Contingent Liabilities not provided for (No Cash Outflow is expected)

i. Bank Guarantees (Bank Guarantees are provided under contractual / legal obligation) 25,851,074 85,753,419

ii. Corporate Guarantee (Given to Banks and Financial Institution for loans taken by the subsidiary company) 10,810,000,000 10,560,000,000

iii. Claims against the Company not acknowledged as debts 15,234,109 11,504,898

iv. Premium on Foreign Currency Convertible Bonds issued 4,073,033,598 4,187,849,528

v. Disputed liability in respect of Sales Tax Matter under appeal (Amount deposited Rs. 38,869,569 (Previous Year Rs. 27,576,360) 170,931,249 108,202,338

Note - 3 Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) as at March 31, 2012 is Rs. 12,031,399,019 (previous year Rs. 12,088,984,317) Cash outflow is expected on execution of such contracts on progressive basis.

Note - 4 The Board of Directors of the Company in its meeting held on December 16, 2010 had considered and approved the Scheme of Arrangement providing for merger of "Chennai Network Infrastructure Limited" (CNIL) with the Company w.e.f. August 1, 2010 (the appointed date) subject to necessary approvals from various statutory authorities. On July 22, 2011, the Hon'ble High Court of Judicature at Bombay has sactioned the above scheme of arrangement between Chennai Network Infrastructure Limited (CNIL) and GTL Infrastructure Limited and their respective shareholders (Scheme) under Section 391 to 394 of the Companies Act, 1956. Sanction of Hon'ble High Court of Judicature at Madras is awaited. In terms of the CDR package (Refer note no 4.4), the above scheme of arrangement will be modified / revised and once the scheme is effective, these accounts will undergo change w.e.f. the appointed date.

Note - 5 Segment Reporting

The Company is predominantly in the business of providing "Telecom Towers" on shared basis and as such there are no separate reportable segments. The Company's operations are predominantly only in India.

Note - 6 Related Party Disclosures

a Related Parties

I Subsidiary

Chennai Network Infrastructure Limited

II Trust

Tower Trust (The Company is sole beneficiary)

III Associates

a GTL Limited

b Technology Infrastructure limited

c Global Holding Corporation Private Limited

IV Key Managerial Personnel

a. Mr. Manoj Tirodkar, Chairman

b. Mr. Prakash Ranjalkar, CEO & Whole-time Director (Upto December 31, 2011)

c. Mr. Milind Naik, Whole-time Director & Co-COO (w.e.f. July 21, 2011)

d. Mr. Ravi Ananth, Whole-time Director (w.e.f. April 29, 2011 upto July 21, 2011)

e. Mr. Prasanna Bidnurkar, Chief Financial Officer (Upto December 29, 2011)

f. Mr. Bhupendra J. Kiny, Chief Financial Officer (w.e.f. December 29, 2011)

Mar 31, 2010

1. Contingent Liabilities:

(No cash outflow is expected in near future)

(Amount in Rupees)

Sr. Particulars As at As At

No. March

31,2010 March 31,2009

Contingent Liabilities not provided for:

i. Bank Guarantees 139,681,002 110,080,894

(Bank Guarantees are provided under contractual / legal obligation)

ii. Claims against the Company not acknowledged as debts 4,679,818 2,479,568

iii. Premium on Foreign Currency Convertible Bonds issued (Refer Note 9 below) 4,153,926,318 5,097,568,687

iv. Disputed liability in respect of Income-tax demand (including interest) matter under appeal NIL 232,664

v. Disputed liability in respect of Sales Tax Matter under appeal (Amount deposited Rs. 3,170,596) 46,057,883 25,974,925

vl. Disputed liability in respect of Custom Duty NIL 9,294,371

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) as at March 31,2010 is Rs. 10,418,448,426 (Previous Year Rs. 16,030,962,514). Cash outflow is expected on execution of such capital contracts, on progressive basis.

3. The Company has entered into Master Services Agreement (MSA) with the Telecom Operators for a period of 10-15 years. Invoices are raised on these operators for provisioning fees and recovery of pass through expenses as part of the said MSA. The Company has requested for the balance confirmations from Sundry Debtors and Sundry Creditors. Confirmations are awaited in respect of some of them.

4. During the year the Company has carried out technical evaluation of all of its fixed assets to determine the estimated useful life of them. This has resulted into revision in the useful life of certain fixed assets and consequent reduction in depreciation for the year ended March 31,2010 by Rs. 164,954,028.

5. In the opinion of the Management, the Current Assets, Loans and Advances are approximately of the value stated, if realised in the ordinary course of business.

6. Employee Stock Option Scheme:

a. The Employee Stock Option Scheme, 2005 (ESOS) was first time introduced and implemented during the Accounting Period 2005-06 for which the approval was obtained from the shareholders at their Extra Ordinary General Meeting held on November 26,2005.

b. On November 26, 2005, the Company granted 1,550,000 Options ("Grant 1") convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 10 per share.

c. On February 12,2007 and February 27,2007, the Company granted 7,490,000 Options ("Grant 2") and 25,000 Options ("Grant 3"), both, convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 29.81 per share.

On October 9, 2007, with a view to compensate the Option holders considering the Rights Issue, the Exercise Price of the Options in respect of ("Grant 2") and ("Grant 3") was re-fixed to Rs. 19.90 per share in place of Rs. 29.81 per share.

d. On October 9, 2007, the Company granted 650,000 Options ("Grant 4 (A)"), convertible into Equity Shares of Rs. 10 each at an exercise price "of Rs. 26.48 per share. Out of above 3,400 Options lapsed during the year.

e. On October 9, 2007, the Company also granted 249,000 Options ("Grant 4 (B)"), convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 26.48 per share.

f. On October 9,2007, with a view to compensate the Option holders considering the Rights Issue, the Company has granted-

- 1,007,500 Options ("Grant 5") at the exercise price of Rs. 10 each to ("Grant 1") Option holders.

- 7,190,000 Options ("Grant 6") at the exercise price of Rs. 19.90 to ("Grant 2") Option holders.

- 25,000 Options ("Grant 7") at the exercise price of Rs. 19.90 each to ("Grant 3") Option holders.

g. On March 11,2008, the Company granted 1,700,000 Options ("Grant 8"), convertible into Equity Shares of Rs. 10 each at an exercise price of Rs. 33.60 per share.

h. Pursuant to approval of Shareholders in Annual General Meeting held on July 10, 2009 all the unvested Options were vested on April 29, 2009, as a consequence of which the outstanding deferred ESOS cost of Rs. 12,701,054 has been charged to Profit and Loss account during the year.

i. During the year, on November 23,2009 the Company granted 600,000 Options ("Grant 9") convertible into Equity Share of Rs. 10 each at an exercise price of Rs. 24.37 per share.

7. During the year the Company has formed a Trust namely "Tower Trust", the sole beneficiary of which is GTL Infrastructure Ltd. The Company has contributed Rs.18,157,224,000 towards the Corpus of the above Trust. The trust has invested the aforementioned amount in "Chennai Network Infrastructure Ltd." (CNIL) a special purpose vehicle (SPV) formed for the purchase of 17,500 towers along with tenancies from Aircel Limited and its subsidiaries.

As sponsors to CNIL, GTL Infrastructure Ltd., along with its associates GTL Ltd., Tower Trust and Global Holding Corporation Pvt. Ltd., have agreed to hold and maintain at least 26% (twenty six percent) of the total paid-up equity share capital of the CNIL and to further contribute in the form of equity, in future, if required to meet needs of CNIL and to replenish the Debt Service Reserve Account Letter of Credit (DSRA LC), in case if the DSRA LC is invoked by the lenders of CNIL.

8. During the year the wholly owned subsidiary "Towers Worldwide Ltd.", ceased to be the subsidiary of the Company and hence the Company does not have any subsidiary company as on March 31,2010 and accordingly no consolidated accounts under Accounting Standard 21 are prepared.

9. Foreign Currency Convertible Bonds:

In the year 2007-08, the Company issued 3,000 Zero Coupon Foreign Currency Convertible Bonds (FCCBs) of USD 100,000 each. The bonds are redeemable only if there is no conversion of the bonds earlier. Hence, the payment of premium on redemption is contingent in nature, the outcome of which is dependent on uncertain future events and accordingly, no provision is considered necessary nor has been made in the accounts in respect of such premium. In case the bonds are redeemed then in such scenario the Company intends to adjust the premium on redemption to Securities Premium Account. The pro-rata premium as on March 31,2010 works out to Rs. 1,940,619,844.

10. In the year 2007-08 the Company had issued 263,650,000 Preferential Convertible Warrants (Exercise Price of Rs. 40 each) on preferential basis to various investors, out of above 217,500,000 warrants have been converted into Equity Shares. Balance 46,150,000 warrants were forfeited and amount received on issue of them was credited to Capital Reserve in the previous year. No Preferential Convertible Warrants were outstanding as on March 31, 2010. Entire proceeds of Preferential Convertible Warrants amounting to Rs. 8,884,600,342 has been utilised towards roll out of telecom towers and acquisition as on March 31,2010.

14. Segment Reporting:

The Company is predominantly in the business of providing "Telecom Towers" on shared basis and as such there are no separate reportable segments. The Companys operations are predominantly only in India.

11. Related Party Disclosures:

a. Related Parties:

I. Subsidiary Company

Towers Worldwide Limited (up to March 30,2010)

II. Associates

a. GTL Limited

b. Technology Infrastructure Limited

c. Global Holding Corporation Private Limited

d. Chennai Network Infrastructure Limited (with effect from March 12, 2010)

e. Tower Trust (with effect from December 29,2009)

III. Key Managerial Personnel

a. Mr. Manoj Tirodkar, Chairman

b. Mr. Prakash Ranjalkar, Whole-time Director

c. Mr. Shishir Parikh, Chief Financial Officer

12. In accordance with the Accounting Standard (AS-28) on "Impairment of Assets" the management during the year carried out an exercise of identifying the assets that may have been impaired in respect of each cash generating unit. On the basis of this review carried out by the management, there was no impairment loss on fixed assets during the year ended March 31,2010.

13. During the year the Company entered into an agreement for assignment of Energy Recoverables with GTL Ltd (Associate Company) which is also in the business of providing the Operation and Maintenance Services and the Energy management of sites. The Energy recoverable assigned and derecognised in the Balance Sheet as on March 31,2010 is Rs. 431,200,534. The Company has an obligation to pay GTL Ltd in case the amount assigned is not recovered within the mutually agreed period. Assignment charges amounting to Rs. 23,337,582 incurred during the year has been charged to Profit and Loss Account.

14. Operating lease:

The Companys significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements.

15. In accordance with Clause 32 of Listing Agreement the details of advance is as under:

a. To Towers Worldwide Limited, a wholly owned subsidiary closing balance as on March 31,2010 is Rs. NIL (Previous Year Rs. 3,271,718,997). Maximum balance outstanding during the year was Rs. 3,271,718,997 (Previous Year Rs. 4,282,212,800).

b. None of the loanees have made, per se, investment in the shares of the Company.

c. As per the Companys policy loans to employees are not considered in a above.

16. The previous years figures, wherever necessary, have been regrouped, reclassified and recast to make them comparable with those of the current year.

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