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Auditor Report of Vodafone Idea Ltd.

Mar 31, 2023

To the Members of Vodafone Idea Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of Vodafone Idea Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31 2023, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Statement of Cashflows and the Statement of Changes in Equity for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, its loss including other comprehensive income its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the âAuditorâs Responsibilities for the Audit of the Standalone Financial Statementsâ section of our report. We are independent of the Company in accordance with the âCode of Ethicsâ issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Material Uncertainty Related to Going Concern

We draw attention to Note 4 to the financial statements, which describes the Companyâs financial condition as of March 31, 2023 and its debt obligations due for the next 12 months. The Companyâs financial performance has impacted its ability to generate the cash flow that it needs to settle/refinance its liabilities as they fall due.

The Companyâs ability to continue as a going concern is dependent on its ability to raise additional funds as required and successful negotiations with lenders and vendors for continued support and generation of cash flow from its operations that it needs to settle its liabilities as they fall due. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the financial year ended March 31, 2023. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.

In addition to the matter described in the âMaterial Uncertainty Related to Going Concernâ section, we have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditorâs responsibilities for the audit of the standalone financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone financial statements.

Key audit matters

How our audit addressed the key audit matter

Revenue recognition (as described in note 5(a) of the Standalone financial statements)

For the year ended March 31, 2023, the service revenue recognised was '' 418,788 million.

Revenue recognition has been identified as a key audit matter due to complexity of systems in recognizing revenues, significance of volumes of data process by system, constantly evolving pricing with discounted tariffs and operation in highly competitive marketplace.

Our audit procedures included the following:

â¢ With the assistance by IT specialists, we obtained an understanding, evaluated the design and tested the operating effectiveness of key IT general and application controls related to revenue recognition processes. We also tested relevant IT infrastructure and applications that result in generation of various IT reports used for billing and revenue recognition process.

â¢ We tested the operating effectiveness of IT dependent manual controls, performed data analytics and trend analysis, test of reconciliations between billing systems and other IT systems, prepaid applications and the general ledger. We also performed procedures to test the computation of deferred revenue.

â¢ We read and assessed the revenue related accounting policy, critical estimates and assumptions and disclosures in the standalone financial statements.

Assessment of claims related to regulatory, taxation and legal matters (as described in note 3, 42(vi) and 44 of the Standalone financial statements)

At March 31, 2023 the value of regulatory, tax and legal disputes disclosed as contingent liabilities was '' 213,232 million.

Pursuant to the Honâble Supreme Court judgement, the Company has recorded and carrying liability of '' 655,462 million related to AGR matter and '' 56,449 million related to one time spectrum charges (OTSC) for more than 6.2 MHz spectrum.

Taxation, regulatory and litigation exposures have been identified as a key audit matter due to changing regulatory environment and significant judgement required by management in assessing the exposure of each case.

Our audit procedures included the following:

â¢ We obtained summary of all tax, regulatory and litigation including managementâs assessment.

â¢ We obtained an understanding, evaluated the design, and tested the operating effectiveness of the controls related to managementâs risk assessment process for taxation, regulatory and legal matters.

â¢ We obtained and read external legal opinions (where considered necessary) and other evidence provided by management to corroborate managementâs assessment of the regulatory and legal matters.

â¢ Engaged tax/regulatory specialists to assess the tax/regulatory positions taken by management with respect to tax/regulatory litigations.

â¢ Verified the provisions recorded in the books by the Company including the interest computations based on the demands received by the Company from DoT, internal records of the Company based on the Honâble Supreme Court judgement and validated the computations in accordance with licence agreement and Honâble Supreme Court judgement for the provisions recorded in the books.

â¢ Assessed the relevant accounting policies and disclosures in the standalone financial statements for compliance with the requirements of accounting standards.

Borrowings, interest and debt covenant testing (as described in note 22 and 26 of the Standalone financial statements)

At March 31, 2023, current and non-current borrowings including interest accrued and AGR liability, excluding intercompany borrowings was '' 2,092,614 million and bank guarantee was '' 61,265 million. Annual covenant testing as at March 31, 2023 resulted in certain ratios breaching the specified covenant threshold for loans aggregating '' 68,160 million. Accordingly, the Company has classified '' 39,271 million from non-current borrowings to current maturities of long-term debt.

Borrowings has been identified as a key audit matter due to debt covenant breach, change in credit ratings of the loans and various correspondences received from banks and financial institutions for additional security / increase in interest/commission rate resulting in recognition, presentation and measurement complexities.

Our audit procedures included the following:

â¢ We tested the debt covenant ratio specified in the loan agreements and the computation and assessed the classification of the borrowing in financial statement based on the results of such testing and waiver from the bank, if any.

â¢ We obtained independent confirmation from the bank with respect to borrowings and non-fund based facilities [including bank guarantees/letter of credit] outstanding as at March 31, 2023 and compared the amounts as per confirmations with the amounts in the books of accounts and tested with the reconciliation provided by the management.

â¢ We verified the interest/commission rate used by the Company for computation of interest cost with the loan/bank guarantee agreements and various correspondences received by the Company from respective banks and corresponding increase in rates due to nonremediation of debt covenant and downgrade in credit rating.

â¢ We verified the security created against fund and non-fund facilities with the agreements and documents related to charges filed with Register of Companies.

â¢ We assessed the borrowing related accounting policy and disclosures in the standalone financial statements for compliance as per Ind AS 107.

Other Information

The Companyâs Board of Directors are responsible for the other information. The other information comprises the Performance Highlights, Corporate Governance Report, Directorsâ Report, Management Discussion and Analysis Report and Business Responsibility and Sustainability Report but does not include the standalone financial statements and our auditorâs report thereon. The Performance Highlights, Corporate Governance Report, Directorsâ Report, Management Discussion and Analysis Report and Business Responsibility and Sustainability Report is expected to be made available to us after the date of this auditorâs report.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether such other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

Responsibilities of Management for the Standalone Financial Statements

The Companyâs Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going

concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.

Auditorâs Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

â¢ Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

â¢ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

â¢ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

â¢ Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.

â¢ Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements for the financial year ended March 31, 2023 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditorâs Report) Order, 2020 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the âAnnexure 1â a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

Comprehensive Income, the Standalone Statement of Cashflows and the Standalone Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;

(e) The going concern matter described in Material Uncertainty Related to Going Concern paragraph above, in our opinion, may have an adverse effect on the functioning of the Company;

(f) On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023 from being appointed as a director in terms of Section 164 (2) of the Act;

(g) With respect to the adequacy of the internal financial controls with reference to these standalone financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;

(h) In our opinion, the managerial remuneration for the year ended March 31, 2023 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;

(i) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 44 to the standalone financial statements;

ii. The Company did not have any material foreseeable losses in long-term contracts including derivative contracts during the year ended March 31, 2023;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2023;

iv. a) The management has represented that, to

the best of its knowledge and belief, no funds

have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other persons or entities, including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

b) The management has represented that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances performed by us, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.

v. No dividend has been declared or paid during the year by the Company.

vi. As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable for the Company only w.e.f. April 1, 2023, reporting under this clause is not applicable.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Nilangshu Katriar

Partner

Membership Number: 058814

UDIN:23058814BGYZOP6453

Place: Mumbai

Date: May 25, 2023

Mar 31, 2022

describes the Companyâs financial condition as of March 31, 2022 and its debt obligations due for the next 12 months. The Companyâs financial performance has impacted its ability to generate the cash flow that it needs to settle/refinance its liabilities as they fall due.

The Companyâs ability to continue as a going concern is dependent on its ability to raise additional funds as required and successful negotiations with lenders for continued support and generation of cash flow from its operations that it needs to settle its liabilities as they fall due. Our conclusion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the financial year ended March 31, 2022. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the âMaterial Uncertainty Related to Going Concernâ section, we have determined the matters described below to be the key audit matters to be communicated in our report. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditorâs responsibilities for the audit of the standalone financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone financial statements.

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the accompanying standalone financial statements of Vodafone Idea Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2022, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2022, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the âAuditorâs Responsibilities for the Audit of the standalone Financial Statementsâ section of our report. We are independent of the Company in accordance with the âCode of Ethicsâ issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Material Uncertainty Related to Going Concern

We draw attention to Note 4 to the financial statements, which

Key audit matters

How our audit addressed the key audit matter

Revenue recognition (as described in note 5(a) of the Standalone financial statements)

For the year ended March 31, 2022, the service revenue recognised was '' 382,018 million.

Our audit procedures included the following:

â¢ We read and assessed the revenue related accounting policy, critical estimates and assumptions and disclosures in the standalone financial statements.

Assessment of claims related to regulatory, taxation and legal matters (as described in note 43, 3 and 41(v) of the Standalone financial statements)

At March 31, 2022 the value of regulatory, tax and legal disputes disclosed as contingent liabilities was '' 198,893 million.

Pursuant to the Honâble Supreme Court judgement, the Company has recorded and carrying liability of '' 659,534 million related to AGR matter and '' 49,572 million related to one time spectrum charges (OTSC) for more than 6.2 MHz spectrum.

Our audit procedures included the following:

â¢ We obtained summary of all tax, regulatory and litigation including managementâs assessment.

â¢ We obtained and read external legal opinions (where considered necessary) and other evidences provided by management to corroborate managementâs assessment of the regulatory and legal matters.

â¢ Engaged tax/regulatory specialists to assess the tax/regulatory positions taken by management with respect to tax/regulatory litigations.

â¢ Assessed the relevant accounting policies and disclosures in the standalone financial statements for compliance with the requirements of accounting standards.

Borrowings, interest and debt covenant testing (as described in note 21 and 25 of the Standalone financial statements)

At March 31, 2022, current and non-current borrowings including interest accrued and AGR liability was '' 1,978,782 million and bank guarantee was '' 218,809 million.

Annual covenant testing as at March 31, 2022 resulted in certain ratios breaching the specified covenant threshold for loans aggregating '' 125,080 million. Accordingly, the Company has classified '' 68,131 million from non-current borrowings to current maturities of long-term debt.

Our audit procedures included the following:

â¢ We obtained independent confirmation from the bank with respect to borrowings and non-fund based facilities [including bank guarantees/letter of credit] outstanding as at March 31, 2022 and compared the amounts as per confirmations with the amounts in the books of accounts and tested with the reconciliation provided by the management.

â¢ We verified the security created against fund and non-fund facilities with the agreements and documents related to charges filed with Register of Companies.

â¢ We assessed the borrowing related accounting policy and disclosures in the standalone financial statements for compliance as per Ind AS 107.

Other Information

Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.

Auditorâs Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

â¢ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

The Companyâs Board of Directors are responsible for the other information. The other information comprises the Performance Highlights, Corporate Governance Report, Directorsâ Report, Management Discussion and Analysis Report and Business Responsibility Report but does not include the standalone financial statements and our auditorâs report thereon. The Performance Highlights, Corporate Governance Report, Directorsâ Report, Management Discussion and Analysis Report and Business Responsibility Report is expected to be made available to us after that date of this auditorâs report.

Our opinion on the standalone financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.

Responsibilities of Management for the Standalone Financial Statements

In preparing the standalone financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

(e) The going concern matter described in Material Uncertainty Related to Going Concern paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on March 31, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022 from being appointed as a director in terms of Section 164 (2) of the Act;

(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company with reference to these standalone financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;

(h) In our opinion, the managerial remuneration for the year ended March 31, 2022 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 43 to the standalone financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There has been no delay in transferring amounts, required to be transferred to the Investor Education and Protection Fund by the Company.

iv. a) The management has represented that, to

the best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other persons or entities, including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements for the financial year ended March 31, 2022 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, the Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

b) The management has represented that, to the best of its knowledge and belief, no funds have been received by the company from any persons or entities, including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

(c) Based on such audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under

sub-clause (a) and (b) contain any material misstatement.

v. No dividend has been declared or paid during the year by the Company.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Nilangshu Katriar

Partner

Membership Number: 58814 UDIN: 22058814AISLTO2797

Place: Mumbai Date: May 10, 2022

Mar 31, 2021

To the Members of Vodafone Idea LimitedReport on the Audit of the Standalone Ind AS Financial StatementsOpinion

We have audited the accompanying standalone Ind AS financial statements of Vodafone Idea Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2021, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2021, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the âAuditorâs Responsibilities for the Audit of the standalone Ind AS Financial Statementsâ section of our report. We are independent of the Company in accordance with the âCode of Ethicsâ issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Material Uncertainty Related to Going Concern

We draw attention to Note 4 to the financial statements, which describes the Companyâs financial condition as at March 31, 2021 and its debt and AGR obligations due for the next 12 months. The Companyâs financial performance has impacted its ability to generate

the cash flow that it needs to settle/refinance its liabilities and guarantees as they fall due, which along with its financial condition is resulting in material uncertainty that casts significant doubt on the Companyâs ability to make the payments mentioned therein and continue as a going concern.

The said assumption of going concern is essentially dependent on its ability to raise additional funds as required in line with the approval by the Companyâs board of directors in its meeting on September 4, 2020, successful negotiations with lenders on continued support, refinancing of debts, monetisation of certain assets, outcome of the modification application filed with the Honâble Supreme Court and clarity of next installment amount, acceptance of its deferment request by DoT and generation of cash flow from its operations that it needs to settle/renew its liabilities/guarantees as they fall due. Our conclusion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone Ind AS financial statements for the financial year ended March 31, 2021. These matters were addressed in the context of our audit of the standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the âMaterial Uncertainty Related to Going Concernâ section, we have determined the matters described below to be the key audit matters to be communicated in our report. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditorâs responsibilities for the audit of the standalone Ind AS financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone Ind AS financial statements.

Key audit matters

How our audit addressed the key audit matter

Revenue recognition

(as described in note 5(a) of the Standalone Ind AS financial statements)

For the year ended March 31, 2021, the service revenue recognised was '' 416,589 million.

Our audit procedures included the following:

â¢ We read and assessed the revenue related accounting policy, critical estimates and assumptions and disclosures in the standalone Ind AS financial statements.

Assessment of claims related to regulatory, t

(as described in note 42, 3 and 40(vii) of the Standalone Ind AS

axation and legal matters

'' financial statements)

At March 31, 2021 the value of regulatory, tax and legal disputes disclosed as contingent liabilities was '' 170,795 million.

Pursuant to the Honâble Supreme Court judgement, Company has recorded the provision for AGR of '' 442,083 million during FY 2020-21 and '' 228,110 million during FY 2019-20. Further, the Company has also recorded provision of '' 5,027 million during FY 2020-21 and '' 38,871 million during FY 201920 for one time spectrum charges for more than 6.2 MHz spectrum.

Our audit procedures included the following:

â¢ We obtained summary of all tax, regulatory and litigation including managementâs assessment.

â¢ We obtained and read external legal opinions (where considered necessary) and other evidences provided by management to corroborate managementâs assessment of the regulatory and legal matters.

â¢ Engaged tax/regulatory specialists to assess the tax/regulatory positions taken by management with respect to tax/regulatory litigations.

â¢ Assessed the relevant accounting policies and disclosures in the standalone Ind AS financial statements for compliance with the requirements of accounting

Borrowings, interest and debt covenant testi

(as described in note 21 of the Standalone Ind AS financial stat

ements)

At March 31, 2021, current and non-current borrowings including interest accrued and AGR liability was '' 1,867,790 million and bank guarantee was '' 239,981 million.

Annual covenant testing as at March 31, 2021 resulted in certain ratios breaching the specified covenant threshold for loans aggregating '' 98,745 million. Accordingly, the Company has classified '' 85,472 million from non-current borrowings to current maturities of long-term debt.

Borrowings has been identified as a key audit matter due to debt covenant breach, change in credit ratings of the loans and various correspondences received from banks and financial institutions for additional security/increase in interest/commission rate resulting in recognition, presentation and measurement complexities.

Our audit procedures included the following:

â¢ We obtained independent confirmation from the bank with respect to borrowings and non-fund based facilities [including bank guarantees/letter of credit] outstanding as at March 31, 2021 and compared the amounts as per confirmations with the amounts in the books of accounts and tested with the reconciliation provided by the management.

â¢ We verified the interest/commission rate used by the Company for computation of interest cost with the loan/bank guarantee agreements and various correspondences received by the Company from respective banks and corresponding increase in rates due to non-remediation of debt covenant and downgrade in credit rating.

â¢ We verified the security created against fund and non-fund facilities with the agreements and documents related to charges filed with Register of Companies.

â¢ We assessed the borrowing related accounting policy and disclosures in the standalone Ind AS financial statements for compliance as per Ind AS 107.

Other Information

The Companyâs Board of Directors are responsible for the other information. The other information comprises the Performance Highlights, Corporate Governance Report, Directorsâ Report, Management Discussion and Analysis Report and Business Responsibility Report but does not include the standalone Ind AS financial statements and our auditorâs report thereon. The Performance Highlights, Corporate Governance Report, Directorsâ Report, Management Discussion and Analysis Report and Business Responsibility Report is expected to be made available to us after that date of this auditorâs report.

Our opinion on the standalone Ind AS financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether such other information is materially inconsistent with the standalone Ind AS financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

Responsibilities of Management for the Standalone Ind AS Financial Statements

The Companyâs Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended by the Companies (Indian Accounting Standards) Second Amendment Rules, 2019. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone Ind AS financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.

Auditorâs Responsibilities for the Audit of the Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

â¢ Identify and assess the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

â¢ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

â¢ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

â¢ Evaluate the overall presentation, structure and content of the standalone Ind AS financial statements, including the disclosures, and whether the standalone Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone Ind AS financial statements for the financial year ended March 31, 2021 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the âAnnexure 1â a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended by the Companies (Indian Accounting Standards) Second Amendment Rules, 2019;

(e) The going concern matter described in Material Uncertainty Related to Going Concern paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on March 31, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021 from being appointed as a director in terms of Section 164 (2) of the Act;

(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;

(h) In our opinion, the managerial remuneration for the year ended March 31, 2021 has been paid/provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 42 to the standalone Ind AS financial statements;

ii. The Company did not have any material foreseeable losses in long-term contracts including derivative contracts during the year ended March 31, 2021;

iii. There has been no delay in transferring amounts, required to be transferred to the Investor Education and Protection Fund by the Company.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Nilangshu Katriar

Partner

Membership Number: 58814 UDIN: 21058814AAAABA2190

Place: Mumbai Date: June 30, 2021

Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Idea Cellular Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss, including the Statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Managementâs Responsibility for the Standalone Ind AS Financial Statements

The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act., read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditorâs Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Emphasis of Matter

We draw your attention to Note 42 A)i of the standalone Ind AS financial statements which describes the uncertainties related to the legal outcome in respect of the Department of Telecommunications (DoT) demand notices for one time spectrum charges. Our report is not qualified in respect of this matter.

Other Matter

The standalone Ind AS financial statements of the Company for the year ended March 31, 2017, included in these standalone Ind AS financial statements, have been audited by the predecessor auditor who expressed an unmodified opinion on those statements on May 13, 2017.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditorâs report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of subsection (11) of section 143 of the Act, we give in the Annexure 1 a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;

(e) On the basis of written representations received from the directors as on March 31, 2018, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of section 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;

(g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 42 to the standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure 1 to the Independent Auditorâs Report

Annexure referred to in paragraph 1 of âReport on other Legal and Regulatory Requirementsâ

Re: Idea Cellular Limited (âthe Companyâ)

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The capitalised fixed assets are physically verified by the management according to a regular programme designed to cover all the items over a period of three years. Pursuant to the programme, a portion of fixed assets and capital work in progress has been physically verified by the management during the year, which in our opinion is reasonable having regard to the size of the Company and nature of its assets. The Company is in the process of reconciling the physical verification results with the records maintained by the Company. However no material discrepancies were identified till the date of this report.

(c) According to information and explanations given by the management and based on the examination of the financial statements/registered deed/transfer deed/conveyance deed/court approving scheme of arrangements, the title deeds of all land and buildings disclosed as property, plant and equipment are held in the name of the Company as at the balance sheet date. In respect of buildings that have been taken on lease and disclosed as property, plant and equipment, the lease agreements are in the name of the Company, where the Company is the lessee in the agreement.

(ii) As explained by the management, the management has conducted physical verification of inventory (other than inventory with third parties) at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.

(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3 (iii) (a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees and securities granted in respect of which provisions of section 185 and 186 of the Companies Act, 2013 are applicable and hence not commented upon.

(v) The Company has not accepted any deposits from public.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013, related to Telecommunication Services, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of records with a view to determine whether they are accurate or complete.

(vii) (a) The Company has generally been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of custom, value added tax, goods and service tax, cess and other material statutory dues applicable to it. The provisions relating to excise duty are not applicable to the Company.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of custom, value added tax, goods and service tax, cess and other material statutory dues were outstanding, as at March 31, 2018 for a period of more than six months from the date they became payable. The provisions relating to excise duty are not applicable to the Company.

(c) According to the records of the Company, the dues of income-tax, sales-tax, service tax, duty of custom, value added tax and cess on account of any dispute, are as follows:

Name of Statute	Nature of Dues	Period to which the amount relates	Forum where Dispute is Pending	Amount Involved (Rs. in Mn)
Income Tax Act ,1961	Income Tax	2009-10, 2010-11, 2012-13	Assistant Commissioner of Income Tax	2.44
Income Tax Act ,1961	Income Tax	2013-16	Deputy Commissioner of Income Tax	607.47
Income Tax Act ,1961	Income Tax	2002-2017	Commissioner of Income Tax (Appeals)	14,525.74
Income Tax Act ,1961	Income Tax	2002-06, 2007-15	Income Tax Appellate Tribunal	6,946.81
Income Tax Act ,1961	Income Tax	2002-03, 2008-12	High Court of Karnataka	115.55
Income Tax Act ,1961	Income Tax	2003-09	High Court of Andhra Pradesh	131.58
Income Tax Act ,1961	Income Tax	2006-09	Madhya Pradesh High Court	129.80
Income Tax Act ,1961	Income Tax	2006-12	Rajasthan High Court	85.05
Income Tax Act ,1961	Income Tax	2002-04	Supreme Court	9.47
Income Tax Act ,1961	Income Tax	2007-10	High Court of Gujarat	30.73
Income Tax Act ,1961	Income Tax	2006-07 to 2010-11	Bombay High Court	234.36
The Finance Act, 1994 (Service Tax provisions)	Service Tax	10.09.2004 to 30.09.2008	High Court of Andhra Pradesh	25.15
The Finance Act, 1994 (Service Tax provisions)	Service Tax	2003-15	Customs Excise & Service Tax Appellate Tribunal	2,837.81
The Finance Act, 1994 (Service Tax provisions)	Service Tax	2004-Upto 2008 Dec, 2014-2016	High Court, Mumbai	15.06
The Finance Act, 1994 (Service Tax provisions)	Service Tax	Oct-98 to Mar-99, Apr-02 to Sep-02, 2004-08	Punjab & Haryana High Court	36.46
The Finance Act, 1994 (Service Tax provisions)	Service Tax	2004-08	Commissioner of Central Excise & Service Tax	44.00
The Finance Act, 1994 (Service Tax provisions)	Service Tax	Apr-99 to Mar-2001, Apr-2003 to Sep-2003, 2005-07	Commissioner of Central Excise & Service Tax (Appeals)	3.84
The Finance Act, 1994 (Service Tax provisions)	Service Tax	2007-09	Supreme Court of India	285.92
Bombay sales tax Act 1959	Sales Tax	2000-01	Sales tax Tribunal	43.90
Central Sales Tax Act, 1956	Sales Tax	2007-08, 2010-11	Joint Commissioner (Appeals)	41.35
Central Sales Tax Act, 1956	Sales Tax	2013-14, 2015-16	Assistant Commissioner Sales Tax	1.04
Central Sales Tax Act, 1956	Sales Tax	2008-09	Deputy Commissioner of Sales Tax	3.92
Delhi Sales Tax Act, 1975	Sales Tax	2002-03	Additional Commissioner (Appeals)	1.86
Gujarat Sales Tax Act, 1969	Sales Tax	1998-02	State Tax Tribunal	8.83
Gujarat Sales Tax Act, 1969	Sales Tax	Apr 06 to Dec 06	Assessing Officer	1.04
Kerala Sales tax Act, 1963	Sales Tax	1997-98	State Tax Tribunal	0.05
Madhya Pradesh Commercial Tax Act, 1994	Sales Tax	2000-01	CG Appellate Board	0.48
Uttar Pradesh Trade Tax Act, 1948	Sales Tax	2003-06, 2007-09, 2010-12	Joint Commissioner (Appeals)	3.11
Uttar Pradesh Trade Tax Act, 1948	Sales Tax	2006-08	State Tax Tribunal	0.69
Uttar Pradesh Trade Tax Act, 1948	Sales Tax	2008-09, 2009-10, 2011-12, 2013-14, 2017-18	Deputy Commissioner of Sales Tax	21.02

Central Sales Tax Act, 1956	Sales Tax	2011-12	Sales Tax Tribunal	33.87
Madhya Pradesh Commercial Tax Act, 1994	Sales Tax	2004-05	Deputy Commissioner of Sales Tax	1.86
Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDEMENT)	Sales Tax	2009-10	Deputy Commissioner of Sales Tax	0.07
Kerala Sales tax Act, 1963	Sales Tax	1998-99	Deputy Commissioner, Sales Tax	0.06
Uttar Pradesh Goods and Service Tax Act, 2017	GST	2017-18	Additional Commissioner (Appeals) GST	0.79
Delhi Value Added Tax Act, 2004	Value Added Tax	2007-08	State Tax Tribunal	14.05
Kerala VAT Act, 2003	Value Added Tax	2012-13, 2014-15, 2015-16	Deputy Commissioner Commercial Tax (Appeals)	0.14
Kerala VAT Act, 2003	Value Added Tax	2011-12	Deputy Commissioner Appeals	0.45
Kerala VAT Act, 2003	Value Added Tax	2011-12	Kerala High Court	81.78
Kerala VAT Act, 2003	Value Added Tax	2011-12, 2016-17	Assistant Commissioner Sales Tax	1.57
Kerala VAT Act, 2003	Value Added Tax	2011-12	Commercial Tax Officer	0.11
Maharashtra Value Added Tax Act, 2002	Value Added Tax	2008-09, 2011-12	Joint Commissioner (Appeals)	323.58
Rajasthan Value Added Tax, 2003	Value Added Tax	2011-12, 2013-14	Assistant Commissioner Sales Tax	11.64
The Bihar Value Added Tax Act, 2005	Value Added Tax	2008-15	State Tax Tribunal	40.70
The Bihar Value Added Tax Act, 2005	Value Added Tax	2015-17	Joint Commissioner (Appeals)	22.22
Uttar Pradesh Value Added Act, 2008	Value Added Tax	2006-07	Deputy Commissioner of Sales Tax	0.74
Uttar Pradesh Value Added Act, 2008	Value Added Tax	2007-2008	High Court Allahabad	0.71
Uttar Pradesh Value Added Act, 2008	Value Added Tax	2011-2012, 2013-2014, 2017-2018	Additional Commissioner (Appeals)	8.40
Kerala VAT Act, 2003	Value Added Tax	2009-10	State Tax Tribunal	0.48
Kerala VAT Act, 2003	Value Added Tax	2016-17	Assessing Officer	0.35
West Bengal Value Added Tax Act, 2003	Value Added Tax	2017-2018	State Tax Tribunal	1.33
The Bihar Value Added Tax Act, 2005	Value Added Ta	2016-17	Commissioner Commercial Taxes Bihar	1.36
Custom Act, 1962	Custom Duty	2003-04, Dec 2009 to Jun 2014	Customs Excise & Service Tax Appellate Tribunal	186.17
Total				26,926.99

The above mentioned figures represent the total disputed cases without any assessment of Probable, Possible and Remote. Of the above cases, total amount deposited in respect of Income Tax is Rs.5,719.78 Mn, Service Tax is Rs.416.35 Mn, Sales Tax and Value Added Tax is Rs.68.75 Mn and Custom Duty is Rs.47.01 Mn.

(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of dues to financial institutions, banks, debenture holders or government.

(ix) During the current year, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments). In our opinion and according to the information and explanations given by the management, the Company has utilized the monies raised by way of term loans for the purposes for which they were raised.

(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the Company or on the Company by the officers and employees of the Company has been noticed or reported during the year.

(xi) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that during the current year, the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013. During the previous year, the Company has paid/accrued remuneration amounting to Rs.100.46 million to its Managing Director, Mr. Himanshu Kapania out of which Rs.28.31 Mn was in excess of the limits specified in section 197 of Companies Act, 2013 read with Schedule V thereto which is now regularised by obtaining the waiver letter from Ministry of Corporate Affairs dated March 17, 2018.

(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3 (xii) of the Order are not applicable to the Company and hence not commented upon.

(xiii) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

(xiv) According to the information and explanations given by the management the Company has complied with provisions of section 42 of the Companies Act, 2013 in respect of the preferential allotment and Qualified Institutions Placement of equity shares of Rs.67,500 Mn during the year. According to the information and explanations given by the management, we report that amount so raised of Rs.67,500 Mn have been initially kept / invested in current account / liquid investments out of which Rs.28,495 Mn have been utilised for the purposes for which the funds were raised and balance of Rs.39,005 Mn remains utilised in liquid investments / current account as at March 31, 2018 which is payable on demand. During the year, the Company has not raised moneys by private placements of convertible debentures.

(xv) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, the Company has not entered into any noncash transactions with directors or persons connected with him as referred to in section 192 of Companies Act, 2013.

(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

Prashant Singhal

Partner

Membership Number: 93283

Place : Mumbai

Date : April 28, 2018

Mar 31, 2017

Independent Auditors Report

To the Members of Idea Cellular Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of IDEA CELLULAR LIMITED ( the Company ), which comprise the Balance Sheet as at March 31, 2017, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management s Responsibility for the Standalone Ind AS Financial Statements

The Company s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ( the Act ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.

In conducting our audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, and its loss, total comprehensive loss, its cash flows and the changes in equity for the year ended on that date.

Emphasis of Matters

We draw attention to the Note 43A(i) to the standalone Ind AS financial statements which describes the uncertainties related to the legal outcome in respect of the Department of Telecommunications (DoT) demand notices for one time spectrum charges.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act, based on our audit we report, to the extent applicable that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A . Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company s internal financial controls over financial reporting.

g) With respect to the other matters to be included in the Auditor s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements Refer Note 43 A and 43 C to the Standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company;

iv. The Company has provided requisite disclosures in the standalone Ind AS financial statements as regards its holding and dealings in Specified Bank Notes as defined in the Notification S.O. 3407(E) dated November 8, 2016 of the Ministry of Finance, during the period from November 8, 2016 to December 30, 2016. Based on audit procedures performed and the representations provided to us by the management we report that the disclosures are in accordance with the books of account maintained by the Company and as produced to us by the Management.

2. As required by the Companies (Auditor s Report) Order,

2016 ( the Order ) issued by the Central Government in terms of Section 143(11) of the Act, we give in Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ( the Act )

We have audited the internal financial controls over financial reporting of IDEA CELLULAR LIMITED ( the Company ) of March 31, 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management s Responsibility for Internal Financial Controls

The Company s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors Responsibility

Our responsibility is to express an opinion on the Company s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the Guidance Note ) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

(i) In respect of its fixed assets:

(Referred to in paragraph 2 under Report on Other Legal and Regulatory Requirements section of our report of even date)

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

c) According to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed / transfer deed / conveyance deed / court orders approving schemes of arrangements / amalgamations provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings are held in the name of the Company as at the balance sheet date. In respect of immovable properties of buildings that have been taken on lease and disclosed as fixed asset in the financial statements, the lease agreements are in the name of the Company, where the Company is the lessee in the agreement.

(ii) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013 in respect of grant of loans, making investments and providing guarantees and securities, as applicable.

(v) According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 of the Companies Act, 2013 and the rules framed there under are applicable.

(vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us, in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income-tax, Sales Tax / Value Added Tax, Service Tax, Customs Duty, cess and other material statutory dues applicable to it to the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty.

b) There were no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income-tax, Sales Tax / Value Added Tax, Service Tax, Customs Duty, cess and other material statutory dues in arrears as at March 31, 2017 for a period of more than six months from the date they became payable.

c) There are no dues of cess which have not been deposited on account of any dispute. Details of dues of Income-tax, Sales Tax / Value Added Tax, Service T ax and Customs Duty which have not been deposited as on March 31, 2017 on account of disputes are given below:

Name of Statute	Nature of Dues	Forum where Dispute is Pending	Period to which the Amount Relates	Amount Involved *(''* in Mn)	Amount Unpaid *(''* in Mn)
Customs Act, 1962	Custom Duty	Customs Excise & Service Tax Appellate Tribunal	2003-04	3.49	3.49
Karnataka Tax on Entry of Goods Act, 1979	Entry Tax	High Court of Karnataka	2004-05	8.92	8.92
MP Entry Tax Act, 1976	Entry Tax	Assistant Commissioner	1998-2001, 2009-10, 2013-2017	87.83	0.89
MP Entry Tax Act, 1976	Entry Tax	CG Commercial Tax Tribunal	2006-2009, 2010-2011	31.26	16.98
MP Entry Tax Act, 1976	Entry Tax	CG High Court	2003-04	0.51	0.37
MP Entry Tax Act, 1976	Entry Tax	Deputy Commissioner Commercial Tax (Appeals)	2011-12	14.36	12.20
MP Entry Tax Act, 1976	Entry Tax	Deputy Commissioner Appeals	2012-13	21.34	18.10
MP Entry Tax Act, 1976	Entry Tax	Madhya Pradesh High Court	1998-01, 2003-14	452.89	91.52
MP Entry Tax Act, 1976	Entry Tax	State Tax Tribunal	2001-03, 2004-2006	12.88	1.08
West Bengal Value Added Tax, 2003	Entry Tax	Deputy Commissioner	2013-14	0.55	0.55
The Maharashtra Municipal Corporations Act	Entry Tax	Deputy Commissioner	2013-14	1.58	0.98
Rajasthan Tax On Entry Of Goods Into Local Areas Act, 1999	Entry Tax	Supreme Court	2008-16	157.09	69.14
Rajasthan Tax On Entry Of Goods Into Local Areas Act, 1999	Entry Tax	Assistant Commissioner	2014-15	2.65	2.65
The Bihar Value Added Tax Act, 2005	Entry Tax	Joint Commissioner (Appeals)	2010-11, 2013-16	33.49	30.89
The Bihar Value Added Tax Act, 2005	Entry Tax	State Tax Tribunal	2010-12	1.07	0.93
The Uttar Pradesh Tax on Entry of Goods Act, 2000	Entry Tax	Assessing Officer	2011-12	0.95	0.95
The Uttar Pradesh Tax on Entry of Goods Act, 2000	Entry Tax	State Tax Tribunal	2007-08	4.89	4.16
The Uttar Pradesh Tax on Entry of Goods Act, 2000	Entry Tax	High Court Allahabad	1999-10	29.25	12.00
Uttar Pradesh Trade Tax Act, 1948	Entry Tax	State Tax Tribunal	2005-06	0.17	0.17
Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDMENT)	Entry Tax	High Court Nainital	2001-04	1.21	0.57
Orissa Entry Tax Act, 1999	Entry Tax	Cuttack High Court	2008-17	57.77	38.94
Himachal Pradesh Entry Tax Act, 2010	Entry Tax	HP High Court	2010-17	114.91	71.79

Name of Statute	Nature of Dues	Forum where Dispute is Pending	Period to which the Amount Relates	Amount Involved *(''* in Mn)	Amount Unpaid *(''* in Mn)
The Jammu & Kashmir Entry Tax on Goods Act, 2000	Entry Tax	Srinagar High Court	2010-17	364.10	79.05
Income Tax Act ,1961	Income Tax	Assistant Commissioner of Income Tax	2009-11, 2012-13	15.21	15.21
Income Tax Act ,1961	Income Tax	Deputy Commissioner of Income Tax	2006-11	390.86	140.99
Income Tax Act ,1961	Income Tax	Commissioner of Income Tax (Appeals)	2002-2016	71,894.21	54,299.73
Income Tax Act ,1961	Income Tax	Income Tax Appellate Tribunal	2002-05, 2007-15	1,339.71	191.18
Income Tax Act ,1961	Income Tax	High Court of Karnataka	2001-02	1.38	1.38
Income Tax Act ,1961	Income Tax	High Court of Andhra Pradesh	2003-09	131.58	-
Income Tax Act ,1961	Income Tax	Madhya Pradesh High Court	2006-09	129.80	-
Income Tax Act ,1961	Income Tax	Rajasthan High Court	2006-10	26.25	-
Income Tax Act ,1961	Income Tax	Supreme Court	2002-04	9.47	-
Income Tax Act ,1961	Income Tax	High Court of Gujarat	2007-10	30.73	0.32
Bombay Sales Tax Act, 1959	Sales Tax	Sales tax Tribunal	2000-01	43.90	43.90
Central Sales Tax Act, 1956	Sales Tax	Joint Commissioner (Appeals)	2007-08,2010-11	41.35	23.17
Central Sales Tax Act, 1956	Sales Tax	Assistant Commissioner	2013-14	0.02	0.02
Central Sales Tax Act, 1956	Sales Tax	Deputy Commissioner, Sales Tax	2008-09, 2011-12	37.79	27.79
Delhi Sales Tax Act, 1975	Sales Tax	Additional Commissioner (Appeals)	2002-03	1.86	-
Gujarat Sales Tax Act, 1969	Sales Tax	State Tax Tribunal	1998-02	8.83	7.04
Gujarat Sales Tax Act, 1969	Sales Tax	Assessing Officer	Apr 06 to Dec 06	1.04	0.83
Kerala Sales tax Act, 1963	Sales Tax	State Tax Tribunal	1997-98	0.05	0.05
Kerala Sales tax Act, 1963	Sales Tax	Deputy Commissioner, Sales Tax	1998-99	0.06	0.06
Madhya Pradesh Commercial Tax Act, 1994	Sales Tax	CG Appellate Board	2000-01	0.48	0.31
Uttar Pradesh Trade Tax Act, 1948	Sales Tax	Joint Commissioner (Appeals)	2003-2012	3.11	1.01
Delhi Value Added Tax Act, 2004	Sales Tax	State Tax Tribunal	2007-08	14.05	11.84
Kerala VAT Act, 2003	Sales Tax	Deputy Commissioner Appeals	2009-10, 2011-12	0.94	0.94
Kerala VAT Act, 2003	Sales Tax	Kerala High Court	2011-12	65.47	65.47
Kerala VAT Act, 2003	Sales Tax	Assistant Commissioner, Sales tax	2011-12	1.38	1.38
Kerala VAT Act, 2003	Sales Tax	Commercial Tax Officer	2010-11	51.49	51.49
Maharashtra Value Added Tax Act, 2002	Sales Tax	Deputy Commissioner, Sales Tax	2011-12	15.15	15.15
Maharashtra Value Added Tax Act, 2002	Sales Tax	Joint Commissioner (Appeals)	2008-09	308.43	308.42

Name of Statute	Nature of Dues	Forum where Dispute is Pending	Period to which the Amount Relates	Amount Involved *(''* in Mn)	Amount Unpaid *(''* in Mn)
Rajasthan Value Added Tax Act, 2003	Sales Tax	Assistant Commissioner, Sales tax	2011-12, 2013-14	11.64	11.19
The Bihar Value Added Tax Act, 2005	Sales Tax	State Tax Tribunal	2008-14	34.01	22.03
The Bihar Value Added Tax Act, 2005	Sales Tax	Commissioner	2016-17	1.36	1.36
The Bihar Value Added Tax Act, 2005	Sales Tax	Joint Commissioner (Appeals)	2014-15	6.69	4.00
Uttar Pradesh Trade Tax Act, 1948	Sales Tax	State Tax Tribunal	2006-08	0.69	0.58
Uttar Pradesh Trade Tax Act, 1948	Sales Tax	Assessing Officer	2008-10, 2011-12, 2013-14	20.50	17.40
The Jammu & Kashmir General Sales Tax Act, 1962	Sales Tax	Srinagar High Court	2009-17	510.15	510.15
Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDEMENT)	Sales Tax	Assessing Officer	2009-10	0.07	-
Uttar Pradesh Value Added Tax Act, 2008	Sales Tax	Deputy Commissioner, Sales Tax	2006-07, Apr 12 to Jul 12	2.67	1.54
Uttar Pradesh Value Added Tax Act, 2008	Sales Tax	High Court Allahabad	2007-08	0.71	-
Uttar Pradesh Value Added Tax Act, 2008	Sales Tax	Additional Commissioner (Appeals)	2011-2013	11.85	9.98
The Finance Act, 1994	Service Tax	Andhra Pradesh High Court	2003-04	25.15	25.15
The Finance Act, 1994	Service Tax	Customs Excise & Service Tax Appellate Tribunal	2003-2012 and 2013-2015	2,654.03	2,534.16
The Finance Act, 1994	Service Tax	High Court, Mumbai	2004-2006, 2007-2010	290.56	4.64
The Finance Act, 1994	Service Tax	Punjab & Haryana High Court	Oct 1998- Mar 99, 2002-2003, 2004-07	14.56	14.56
The Finance Act, 1994	Service Tax	Commissioner of Central Excise & Service Tax	2004-05, Apr 05 to Sep 07	41.98	36.98
The Finance Act, 1994	Service Tax	Commissioner of Central Excise & Service Tax (Appeals)	1999-01, Apr 03 to Sep 03, 2005-2012	15.18	14.71

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government and dues to debenture holders.

(ix) During the current year, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments). In our opinion and according to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were raised, other than temporary deployment pending application of proceeds.

(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.

(xi) According to the information and explanations given to us, the Company has paid/accrued remuneration amounting to '' 100.46 million to its Managing Director, Mr. Himanshu Kapania. As the Company did not have profits in the financial year ended March 31, 2017, an amount of '' 30.54 Mn is in excess of the limits specified in section 197 of Companies Act, 2013 (the Act) read with Schedule V thereto. The Company is in the process of complying with the statutory requirements prescribed to regularize such excess payments, including seeking approval of shareholders / central government, as necessary.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with Section 188 and 177 of the Companies Act, 2013, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.

(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to us, during the year, the Company has not entered into any non-cash transactions with its directors, directors of subsidiary companies, directors of associate company or persons connected with them and hence provisions of section 192 of the Companies Act, 2013 are not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

For Deloitte Haskins & Sells LLP

Chartered Accountants

Firm s Registration No. 117366W / W-100018

Hemant M. Joshi

Partner

Membership No: 38019

Place: Mumbai

Date : May 13, 2017

Mar 31, 2016

We have audited the accompanying standalone financial statements of IDEA CELLULAR LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Accounting Standards prescribed under section 133 of the Act, as applicable.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder and the Order under section 143(11) of the Act.

We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2016, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to the Note 32A(i) to the financial statements which describes the uncertainties related to the legal outcome in respect of the Department of Telecommunication (DoT) demand notices for one time spectrum charges.

Our Opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards prescribed under section 133 of the Act, as applicable.

e) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure A". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.

g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements Â Note 32 (A) and 32 (C) to the financial statements;

ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

2. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure B" a statement on the matters specified in paragraphs 3 and 4 of the Order.

Annexure "A" to the Independent Auditor''s Report

(Referred to in paragraph "1(f)" under ''Report on Other Legal and Regulatory Requirements'' of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

1. We have audited the internal financial controls over financial reporting of IDEA CELLULAR LIMITED ("the Company") as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

2. The Company''s management is responsible for establishing and maintaining internal financial controls based on "the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India". These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors'' Responsibility

3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

4. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

5. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

6. In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on "the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India".

Annexure "B" to the Independent Auditor''s Report

(Referred to in paragraph 2 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

(i) In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

c) According to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed / transfer deed / conveyance deed provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings, are held in the name of the Company as at the balance sheet date except the following:

Nature Number Gross Net Remarks of Asset of Cases Block Block Rs. In Mn Rs. In Mn

Land 79 74.27 72.79 The ownership of these properties is transferred and vested in the Company through High Court merger Building 36 507.33 274.50 approvals. The titles are pending mutation in the name of the Company.

In respect of immovable properties of land and buildings that have been taken on lease and disclosed as fixed asset in the financial statements, the lease agreements are in the name of the

Company, where the Company is the lessee in the agreement except the following:

Nature Number Gross Net Remarks of Asset of Cases Block Block Rs. In Mn Rs. In Mn

Leasehold 11 67.42 24.82 The land leases Land are transferred in the name of Company through High Court merger approvals and the same are pending mutation in the name of Company.

(ii) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013 in respect of grant of loans, making investments and providing guarantees and securities, as applicable.

(v) According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 of the Companies Act, 2013 and the rules framed there under are applicable.

(vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us, in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax / Value Added Tax, Service Tax,Customs Duty,cess and other material statutory dues applicable to it to the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty.

b) There were no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax / Value Added Tax, Service Tax,Customs Duty,cess and other material statutory dues in arrears as at 31st March, 2016 for a period of more than six months from the date they became payable.

c) There are no dues of cess which have not been deposited on account of any dispute. Details of dues of Income-tax, Sales Tax / Value Added Tax, Service Tax and Customs Duty which have not been deposited as on 31st March, 2016 on account of disputes are given below:

Name of Statute Nature of Forum where Dues Dispute is Pending

Customs Act, 1962 Custom Customs Excise & Service Duty Tax Appellate Tribunal

Karnataka Tax on Entry Entry Tax High Court of Karnataka of Goods Act, 1979

MP Entry Tax Act, 1976 Entry Tax Assistant Commissioner, Deputy Commissioner (Appeals), State Tax Tribunal, CG Appellate Board, Madhya Pradesh High Court

Orissa Entry Entry Tax High Court, Cuttack Tax Act, 1999

Rajasthan Tax On Entry Entry Tax Supreme Court Of Goods Into Local Areas Act, 1999

The Bihar Value Added Entry Tax Joint Commissioner Tax Act, 2005 (Appeals), State Tax Tribunal

The Uttar Pradesh Tax Entry Tax Assessing Officer, State Tax on Entry of Goods Tribunal, High Court Act, 2000, Uttar Pradesh Allahabad Trade Tax Act, 1948

Uttar Pradesh Trade Entry Tax High Court Nainital Tax Act, 1948 (UTTRAKHAND AMENDMENT)

Himachal Pradesh Entry Tax Assistant Excise and Entry Tax Act, 2010 Taxation Commissioner

The Jammu & Kashmir Entry Tax Srinagar High Court Entry Tax on Goods Act, 2000

Income Tax Act,1961 Income Tax Commissioner of Income Tax (Appeals)

Income Tax Act ,1961 Income Tax Income Tax Appellate Tribunal

Income Tax Act ,1961 Income Tax High Court of Karnataka

Income Tax Act ,1961 Income Tax High Court of Andhra Pradesh

Income Tax Act ,1961 Income Tax Madhya Pradesh High Court

Income Tax Act ,1961 Income Tax Deputy Commissioner of Income Tax

Income Tax Act ,1961 Income Tax Rajasthan High Court

Income Tax Act ,1961 Income Tax Supreme Court

Income Tax Act ,1961 Income Tax High Court of Gujarat

Central Sales Tax Sales Tax Joint Commissioner Act, 1956 (Appeals)

Central Sales Tax Sales Tax Deputy Commissioner, Act, 1956 Sales Tax

Delhi Sales Tax Sales Tax Additional Commissioner Act, 1975 (Appeals)

Gujarat Sales Tax Sales Tax State Tax Tribunal Act, 1969

Gujarat Sales Tax Sales Tax Assessing Officer Act, 1969

Kerala Sales tax Sales Tax State Tax Tribunal Act, 1963

Kerala Sales tax Sales Tax Deputy Commissioner, Act, 1963 Sales Tax

Madhya Pradesh Sales Tax CG Appellate Board Commercial Tax Act, 1994

Madhya Pradesh Sales Tax State Tax Tribunal Commercial Tax Act, 1994

Madhya Pradesh Sales Tax Deputy Commissioner Commercial Tax Appeals Act, 1994

Madhya Pradesh Sales Tax Madhya Pradesh High Court Commercial Tax Act, 1994

The Jammu & Kashmir Sales Tax Srinagar High Court General Sales Tax Act, 1962

Uttar Pradesh Trade Sales Tax Additional Commissioner Tax Act, 1948 (Appeals)

Uttar Pradesh Trade Sales Tax Joint Commissioner Tax Act, 1948 (Appeals)

Delhi Value Added Sales Tax State Tax Tribunal Tax Act, 2004

Kerala VAT Act, 2003 Sales Tax Deputy Commissioner Appeals

Kerala VAT Act, 2003 Sales Tax Kerala High Court

Kerala VAT Act, 2003 Sales Tax Assistant Commissioner, Sales tax

Kerala VAT Act, 2003 Sales Tax Intelligence Officer

Maharashtra Value Sales Tax Deputy Commissioner, Added Tax Act, 2002 Sales Tax

Maharashtra Value Sales Tax Joint Commissioner Added Tax Act, 2002 (Appeals)

Rajasthan Value Added Sales Tax Assistant Commissioner, Tax Act, 2003 Sales tax

The Bihar Value Added Sales Tax State Tax Tribunal Tax Act, 2005

Uttar Pradesh Trade Sales Tax State Tax Tribunal Tax Act, 1948

Uttar Pradesh Trade Sales Tax Assessing Officer Tax Act, 1948

Uttar Pradesh Trade Sales Tax Assessing Officer Tax Act, 1948 (Uttrakhand Amendment)

Uttar Pradesh Value Sales Tax Deputy Commissioner, Added Tax Act, 2008 Sales Tax

Uttar Pradesh Value Sales Tax High Court Allahabad Added Tax Act, 2008

Uttar Pradesh Value Sales Tax Additional Commissioner Added Tax Act, 2008 (Appeals)

The Finance Act, 1994 Service Tax Customs Excise & Service Tax Appellate Tribunal

The Finance Act, 1994 Service Tax High Court, Mumbai

The Finance Act, 1994 Service Tax Punjab & Haryana High Court

The Finance Act, 1994 Service Tax Commissioner of Central Excise & Service Tax

The Finance Act, 1994 Service Tax Commissioner of Central Excise & Service Tax (Appeals)

Name of Statute Period to Amount Amount which the Involved Unpaid Amount Relates (Rs. in Mn) (Rs. in Mn)

Customs Act, 1962 2003-04 7.12 7.12

Karnataka Tax on Entry 2004-05 8.92 8.92 of Goods Act, 1979

MP Entry Tax Act, 1976 1998-16 540.24 108.14

Orissa Entry Nov 08 to 48.13 33.13 Tax Act, 1999 Mar 16

Rajasthan Tax On Entry 2008-16 152.08 71.16 Of Goods Into Local Areas Act, 1999

The Bihar Value Added 2010-14 2.25 2.11 Tax Act, 2005

The Uttar Pradesh Tax 1999-10, 2011-12 35.26 17.27 on Entry of Goods Act, 2000, Uttar Pradesh Trade Tax Act, 1948

Uttar Pradesh Trade 2001-04 1.21 0.57 Tax Act, 1948

Himachal Pradesh 2010-16 81.15 47.19 Entry Tax Act, 2010

The Jammu & Kashmir 2009-16 267.94 - Entry Tax on Goods Act, 2000

Income Tax Act,1961 2002-16 61,751.56 48,522.75

Income Tax Act,1961 2002-05, 2006-15 1,568.07 235.47

Income Tax Act,1961 2001-02 1.38 1.38

Income Tax Act,1961 2003-09 131.58 -

Income Tax Act,1961 2006-09 129.80 -

Income Tax Act,1961 2006-13 29.05 29.05

Income Tax Act,1961 2006-10 25.10 -

Income Tax Act,1961 2002-04 9.47 -

Income Tax Act,1961 2007-10 30.73 0.32

Central Sales Tax Act, 1956 2010-11 3.61 1.47

Central Sales Tax Act, 1956 2008-09, 2011-12 37.79 27.79

Delhi Sales Tax 2002-03 1.86 - Act, 1975

Gujarat Sales Tax 1998-02 8.83 7.04 Act, 1969

Gujarat Sales Tax Apr 06 to Dec 06 1.04 0.83 Act, 1969

Kerala Sales tax 1997-98 0.05 0.05 Act, 1963

Kerala Sales tax 1998-99 0.06 0.06 Act, 1963

Madhya Pradesh 2000-01 0.48 0.31 Commercial Tax Act, 1994

Madhya Pradesh 2003-11 44.84 25.96 Commercial Tax Act, 1994

Madhya Pradesh 2011-13 6.96 6.96 Commercial Tax Act, 1994 Madhya Pradesh 2013-14 0.76 0.76 Commercial Tax Act, 1994

The Jammu & Kashmir 2009-16 494.37 494.37 General Sales Tax Act, 1962

Uttar Pradesh Trade 2003-05 1.24 - Tax Act, 1948

Uttar Pradesh Trade 2002-06, 2007-12 6.20 1.10 Tax Act, 1948

Delhi Value Added 2007-08 14.05 11.84 Tax Act, 2004

Kerala VAT Act, 2003 2009-10, 2011-12, 0.98 0.98 2014-15

Kerala VAT Act, 2003 2011-12 65.47 65.47

Kerala VAT Act, 2003 2011-12 1.38 1.38

Kerala VAT Act, 2003 2005-06, 2012-14 0.59 0.59

Maharashtra Value 2011-12 15.15 15.15 Added Tax Act, 2002

Maharashtra Value 2008-09 308.43 308.42 Added Tax Act, 2002

Rajasthan Value Added 2011-12 0.01 0.01 Tax Act, 2003

The Bihar Value Added 2008-14 34.01 22.03 Tax Act, 2005

Uttar Pradesh Trade 2006-08 0.69 0.58 Tax Act, 1948

Uttar Pradesh Trade 2008-10, 2011-14 23.34 20.17 Tax Act, 1948

Uttar Pradesh Trade 2009-10 0.07 - Tax Act, 1948

Uttar Pradesh Trade 2006-07, Apr 12 Tax Act, 1948 to Jul 12 2.67 1.54

Uttar Pradesh Trade 2007-08 0.71 - Tax Act, 1948

Uttar Pradesh Trade 2009-12 17.56 13.16 Tax Act, 1948

The Finance Act, 1994 2003-15 3,171.60 3,046.42

The Finance Act, 1994 2006-08, Oct 08 533.74 - to Sep 09, Oct 09 to Feb10, Oct11 to Jun 12

The Finance Act, 1994 Oct 98 to Mar 99, 46.02 31.91 Apr 02 to Sep02, 2004-08

The Finance Act, 1994 2004-05, Apr 05 41.98 36.98 to Sep07

The Finance Act, 1994 1999-01, Apr 03 7.49 7.37 to Sep 03, Jul 06 & Jul 07, Nov 08 to Jan 10, 2005- 07, 2008-09

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government and dues to debenture holders.

(ix) During the current year, the Company has not raised money by way of initial public offer or further public offer (including debt instruments). In our opinion and according to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were raised, other than temporary deployment pending application of proceeds.

(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.

(xi) In our opinion and according to the information and explanations given to us, the Company has paid/ provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with Section 188 and 177 of the Companies Act, 2013, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.

(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to us, during the year, the Company has not entered into any non-cash transactions with its directors or persons connected with him and hence provisions of section 192 of the Companies Act, 2013 are not applicable.

(xvi) The Company is not required to be registered under section 45-I of the Reserve Bank of India Act, 1934.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm''s Registration No. 117366W/W-100018)

Khurshed Pastakia

Partner

(Membership No. 31544)

Place : Mumbai

Date : April 28, 2016

Mar 31, 2015

We have audited the accompanying standalone financial statements of IDEA CELLULAR LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the company has in place an adequate internal financial controls system over financial reporting and operating effectiveness of such control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to Note 32 (i) to the financial statements. The Department of Telecommunication (DoT) has issued demand notices dated 8th January 2013 towards one time spectrum charges for spectrum held by the Company beyond 6.2 Mhz for the period from 1st July 2008 to 31st December 2012 amounting to Rs. 3,691.30 Million and beyond 4.4 Mhz for the period from 1st January 2013 till the expiry of the license amounting to Rs. 17,443.70 Million in the respective telecom service areas. In the opinion of the Company, inter-alia, the above demand amounts to alteration of financial terms of the licenses issued in the past. The Company therefore filed a petition before the Hon'ble High Court of Bombay, which has directed DoT, not to take any coercive action until the matter is further heard.

The financial impact of the abovementioned matter is dependent upon the outcome of the petition filed by Company in the Hon'ble High Court of Bombay and therefore no effect for the one time spectrum charges has been given in these financial statements.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors as on 31st March, 2015

taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2015 from being appointed as a director in terms of Section 164(2) of the Act.

(f) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - 32 (i) & (iii) to the financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure to the Independent Auditors' Report

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements' section of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to information and explanation given to us the Management is in the process of reconciling the results of such physical verification with the fixed assets register. Management believes that differences if any, arising out of such reconciliation are not expected to be material.

2. In respect of its inventory:

a) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the Register maintained under section 189 of the Companies Act, 2013.

4. In our opinion and according to the information and explanations given to us, having regard to explanation that certain items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and for the rendering of services. During the course of our audit, we have not observed any major weakness in such internal control system.

5. According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 of the Companies Act, 2013 and the rules framed there under are applicable.

6. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2014 prescribed by the Central Government under section 148(1) of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

7. According to information and explanations given to us, in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees' State Insurance, Income Tax, Wealth Tax, Service Tax, Customs Duty, Value Added Tax / Sales Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty and Investor Education and Protection Fund.

b) There were no undisputed amount payable in respect of Provident Fund, Employees' State Insurance, Income Tax, Wealth Tax, Service Tax, Customs Duty, Value Added Tax / Sales Tax, Cess and other material statutory dues in arrears, as at 31st March 2015 for a period of more than six months from the date they became payable.

c) There are no amounts that are due to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.

d) There are no dues of Wealth Tax and Cess which have not been deposited on account of any dispute. Details of dues of Income Tax, Sales Tax, Service Tax, Customs duty and Entry Tax which have not been deposited as on 31st March 2015 by the Company on account of disputes are given below:

Name of the Nature of Period to which Statute Dues the amount pertains

Customs Act, 1962 Custom Duty 2003-04

Haryana Land Development Tax Act, 2001 Entry Tax 2002-03

Himachal Pradesh Entry Tax Act, 2010 Entry Tax 2010-15

Karnataka Tax on Entry of Goods Entry Tax 2004-05

Act, 1979

MP Entry Tax Act, 1976 Entry Tax 1998-01

MP Entry Tax Act, 1976 Entry Tax 2001-06

MP Entry Tax Act, 1976 Entry Tax 2007-09, 2012-13

MP Entry Tax Act, 1976 Entry Tax 1998-01, 2003-04, 2005-12 Rajasthan Tax On Entry Of Goods Into Entry Tax 2008-11, 2012-14

Local Areas Act, 1999

The Bihar Value Added Tax Act, 2005 Entry Tax 2010-12

The Jammu & Kashmir Entry Tax 2009-13 Entry Tax on Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry Tax 2007-08

Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry Tax 1999-00, 2001-05, Goods Act, 2000 2006-07, April 2007 to December 2007

The Uttar Pradesh Tax on Entry of Entry Tax January 2008 to March 2008

Goods Act, 2000

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2005-06

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2008-10

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2001-04

(UTTRAKHAND AMENDEMENT)

Orissa Entry Tax Entry Tax November 2008 to Act, 1999 October 2009

Income Tax Act, 1961 Income Tax 2001-15

Income Tax Act, Income Tax 2010-13

Income Tax Act, Income Tax 2007-10 1961

Income Tax Act, Income Tax 2001-02 1961

Income Tax Act, Income Tax 2003-05, 2006-12 1961

Income Tax Act, Income Tax 2007-09 1961

Central Sales Tax Sales Tax 2011-12 Act, 1956

Central Sales Tax Sales Tax 2008-09, 2010-11 Act, 1956

Gujarat Sales Tax Sales Tax April 2006 to Act, 1969 December 2006

Gujarat Sales Tax Sales Tax 1998-02 Act, 1969

Kerala Sales Tax Sales Tax 1997-98 Act, 1963

Kerala Sales Tax Sales Tax 1998-99 Act, 1963

Madhya Pradesh Sales Tax 2000-01 Commercial

Tax Act, 1994

Madhya Pradesh Sales Tax 2003-11 Commercial Tax Act, 1994

Madhya Pradesh Sales Tax 2011-13 Commercial Tax Act, 1994

Maharashtra Value Sales Tax 2008-09 Added Tax Act,2002

The Bihar Value Sales Tax 2008-09, 2010-13 Added Tax Act,2005

The Bihar Value Sales Tax 2009-10, 2013-14 Added Tax Act,2005

Uttar Pradesh Sales Tax 2005-06, 2008-10 Trade Tax Act,1948

Uttar Pradesh Sales Tax 2012-14 Trade Tax Act,1948

Uttar Pradesh Sales Tax 2007-08 Trade Tax Act,1948

Uttar Pradesh Sales Tax 2009-12, April 2013 Value Added to August 2013 Tax Act,2008

Uttar Pradesh Sales Tax April 2012 to Value Added July 2012 Tax Act,2008

Delhi Value Sales Tax 2007-08 Added Tax Act, 2004

The Jammu & Sales Tax 2009-15 Sales Tax Act,1962

Kerala VAT Sales Tax 2011-12 Act,2003

Kerala VAT Sales Tax 2005-06, 2009-10, Act,2003 2012-15

The West Bengal Sales Tax 2011-12 Value Added Tax Act,2003

The Finance Service Tax 2005-07, April Act,1994 2007 to July 2007, 2008-10

The Finance Act,1994 Service Tax April 2004 to December 2008 The Finance Act,1994 Service Tax 2003-12

The Finance Act,1994 Service Tax 2006-08,October 2008 to September 2009, October 2009 to February 2010, October 2011 to June 2012

The Finance Act,1994 Service Tax October 1998 to March 1999, April 2002 to September 2002, 2004-07

Name of the Nature of Amount Forum where Statute Dues (Rs. Mn) the dispute is pending

Customs Act, 1962 Custom Duty 7.12 Customs Excise & Service Tax Appellate Tribunal

Haryana Land Development Entry Tax 9.52 State Tax Tax Act, 2001 Tribunal

Himachal Pradesh 56.77 Asst. Excise Entry Tax Act, 2010 Entry Tax & Taxation Commissioner

Karnataka Tax on 8.92 High Court Entry of Goods Entry Tax of Karnataka Act, 1979

MP Entry Tax Entry Tax 0.13 Asst. Act, 1976 Commissioner, Entry Tax

MP Entry Tax Act, 1976 Entry Tax 6.51 State Tax Tribunal

MP Entry Tax Act, 1976 Entry Tax 23.48 Deputy Commissioner (Appeals)

MP Entry Tax Act, 1976 Entry Tax 137.37 Madhya Pradesh High Court

Rajasthan Tax On 35.69 Supreme Court Entry Of Goods Into Entry Tax Local Areas Act, 1999

The Bihar Value 1.06 Joint Commissioner (Appeals) Added Tax Act, 2005 Entry Tax 77.42 Srinagar High The Jammu & Kashmir Entry Tax Court Entry Tax on Goods Act, 2000

The Uttar Pradesh 2.03 State Tax Tax on Entry of Entry Tax Tribunal

Goods Act, 2000

The Uttar Pradesh 8.63 High Court Tax on Entry of Entry Tax Allahabad Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry Tax 4.16 State Tax Tribunal

Goods Act, 2000

Uttar Pradesh Trade 0.17 Additional Tax Act, 1948 Entry Tax Commissioner (Appeals)

Uttar Pradesh Trade 5.17 High Court Tax Act, 1948 Entry Tax Allahabad

Uttar Pradesh Trade 0.57 High Court Tax Act, 1948 Entry Tax Nainital (UTTRAKHAND AMENDEMENT)

Orissa Entry Tax Entry Tax 5.20 Supreme Court Act, 1999 53,082.85 Commissioner of Income Tax Income Tax Act, 1961 Income Tax (Appeals)

Income Tax Act, Income Tax 10.45 Deputy Commissioner (Appeals)

Income Tax Act, Income Tax 0.32 High Court 1961 Gujarat

Income Tax Act, Income Tax 1.38 High Court of 1961 Karnataka

Income Tax Act, Income Tax 126.94 Income Tax 1961 Appellate Tribunal

Income Tax Act, Income Tax 0.09 Income Tax 1961 Officer

Central Sales Tax Sales Tax 0.09 Commissioner Act, 1956 of Commercial Taxes (Appeals)

Central Sales Tax Sales Tax 5.39 Deputy Act, 1956 Commissioner, Sales Tax

Gujarat Sales Tax Sales Tax 0.83 Assessing Act, 1969 Officer

Gujarat Sales Tax Sales Tax Act, 1969 7.04 State Tax Tribunal

Kerala Sales Tax Sales Tax Act, 1963 0.05 State Tax Tribunal

Kerala Sales Tax Sales Tax 0.06 Deputy Act, 1963 Commissioner, Sales Tax

Madhya Pradesh Sales Tax Commercial 0.31 CG Appellate Tax Act, 1994 Board

Madhya Pradesh Sales Tax 25.96 State Tax Commercial Tribunal Tax Act, 1994

6.96 Deputy Madhya Pradesh Sales Tax Commissioner Commercial (Appeals) Tax Act, 1994 308.42 Deputy Maharashtra Value Sales Tax Commissioner, Added Tax Sales Tax Act,2002

The Bihar Value Sales Tax 16.48 State Tax Added Tax Tribunal Act,2005

The Bihar Value Sales Tax 5.55 Joint Added Tax Commissioner Act,2005 (Appeals)

Uttar Pradesh Sales Tax 0.59 Joint Trade Commissioner Tax Act,1948 (Appeals)

Uttar Pradesh Sales Tax 3.86 Assessing Trade Officer Tax Act,1948

Uttar Pradesh Sales Tax 0.58 State Tax Trade Tribunal Tax Act,1948

Uttar Pradesh Sales Tax 8.79 Additional Value Added Commissioner Tax Act,2008 (Appeals)

Uttar Pradesh Sales Tax 1.54 Deputy Value Added Commissioner, Tax Act,2008 Sales Tax

Delhi Value Sales Tax 11.84 State Tax Added Tribunal Tax Act, 2004

The Jammu & Sales Tax 299.80 Srinagar High Sales Tax Court Act,1962 Asst. Kerala VAT Sales Tax 1.38 Commissioner, Act,2003 Sales Tax

Kerala VAT Sales Tax 1.12 Intelligence Act,2003 Officer

The West Bengal Sales Tax 0.65 Commissioner of Value Added Commercial Tax Act,2003 Taxes (Appeals)

The Finance Service Tax 4.27 Commissioner of Act,1994 Central Excise & Service Tax (Appeals)

The Finance Service Tax 58.82 Commissioner of Act,1994 Service Tax

The Finance Service Tax 703.38 Customs Excise & Act,1994 Appellate Tribunal

The Finance Service Tax 533.74 High Court Act,1994 Mumbai

The Finance Service Tax 12.54 Punjab and Act,1994 Haryana High Court

8. The Company does not have accumulated losses at the end of the financial year and the Company has not incurred cash losses in the financial year and in the immediately preceding financial year.

9. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders.

10. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

11. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

12. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For DELOITTE HASKINS & SELLS LLP Chartered Accountants (Firm's Registration No. 117366W/W-100018)

Khurshed Pastakia Partner (Membership No. 31544)

Place : Mumbai Date :28th April, 2015

Mar 31, 2014

We have audited the accompanying financial statements of IDEA CELLULAR LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2014;

(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Emphasis of Matter

We draw attention to Note 31 (i) to the financial statements. The Department of Telecommunication (DoT) has issued demand notices dated 8th January 2013 towards one time spectrum charges for spectrum held by the Company beyond 6.2 Mhz for the period from 1st July 2008 to 31st December 2012 amounting to Rs. 3,691.30 Mn. and beyond 4.4 Mhz for the period from 1st January 2013 till the expiry of the license amounting to Rs. 17,443.70 Mn. in the respective telecom service areas. In the opinion of the Company, inter-alia, the above demand amounts to alteration of financial terms of the licenses issued in the past. The Company therefore filed a petition before the Hon''ble High Court of Bombay, which has directed DoT, not to take any coercive action until the matter is further heard.

The financial impact of the abovementioned matter is dependent upon the outcome of the petition filed by Company in the Hon''ble High Court of Bombay and therefore no effect for the one time spectrum charges has been given in these financial statements.

Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by Section 227(3) of the Act, we report that:

(a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs).

(e) On the basis of the written representations received from the directors as on 31st March 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2014 from being appointed as a director in terms of Section 274(1)(g) of the Act.

Annexure to the Independent Auditors'' Report

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to information and explanation given to us the Management is in the process of reconciling the results of such physical verification with the fixed assets register. Management believes that differences if any, arising out of such reconciliation are not expected to be material.

c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventory:

a) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the Register maintained under section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, having regard to explanation that certain items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and for the rendering of services. During the course of our audit, we have not observed any major weaknesses in such internal control system.

5. In our opinion and according to the information and explanations given to us, there were no contracts or arrangements, particulars of which needed to be entered in the register maintained under section 301 of the Companies Act, 1956.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 and The Cost Accounting Records (Telecommunication Industry) Rules, 2011 prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. According to information and explanations given to us, in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise Duty and Investor Education and Protection Fund.

b) There were no undisputed amount payable in respect of Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues in arrears, as at 31st March 2014 for a period of more than six months from the date they became payable.

c) There are no dues of Wealth Tax and Cess which have not been deposited on account of any dispute. Details of dues of Income Tax, Sales Tax, Service Tax, Customs duty and Entry Tax which have not been deposited as on 31st March 2014 by the Company on account of disputes are given below:

Name of the Statute Nature of Period to which Dues the amount pertains

Customs Act, 1962 Custom Duty 2003-04

Haryana Land Development Entry Tax 2002-03 Tax Act, 2001

Himachal Pradesh Entry Tax Act, 2010 Entry Tax 2010 to 14

Karnataka Tax on Entry of Entry Tax 2004-05 Goods Act, 1979

MP Entry Tax Act, 1976 Entry Tax 1998 to 01

MP Entry Tax Act, 1976 Entry Tax 2006-07

MP Entry Tax Act, 1976 Entry Tax 1998 to 01, 2005-2006, 2007 to 11

MP Entry Tax Act, 1976 Entry Tax 2002 to 06

The Uttar Pradesh Tax on Entry of Entry Tax 1999-00, 2001 to 04, Goods Act, 2000 2006-07

The Uttar Pradesh Tax on Entry Entry Tax 2004-05 of Goods Act, 2000

The Uttar Pradesh Tax on Entry Entry Tax 2007-08 of Goods Act, 2000

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2005-06

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2008 to 10

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2001 to 04 (UTTRAKHAND AMENDEMENT)

Orissa Entry Tax Act, 1999 Entry Tax Nov-08 to Oct-09

The Jammu & Kashmir Entry Tax Entry Tax 2009 to 13 on Goods Act, 2000

Rajasthan Tax On Entry Of Goods Entry Tax 2008 to 11 Into Local Areas Act, 1999

Income Tax Act, 1961 Income Tax Jan-08 to Mar-08, Jul-08 to Sep-08, Jan-09 to Mar-09, 2007 to 13

Income Tax Act, 1961 Income Tax 2002 to 13

Income Tax Act, 1961 Income Tax 2007 to 10

Income Tax Act, 1961 Income Tax 2000-01, 2002 to 05

Income Tax Act, 1961 Income Tax 2004-05, 2008 to 11, 2011-12 Q1 and Q2

Income Tax Act, 1961 Income Tax 2010 to 12

Central Sales Tax Act, 1956 Sales Tax 2008-09

Delhi Sales Tax Act, 1975 Sales Tax 2004-05

Delhi Value Added Tax Act, 2004 Sales Tax 2007-08

Gujarat Sales Tax Act, 1969 Sales Tax Apr-06 to Dec-06

Gujarat Sales Tax Act, 1969 Sales Tax 1998 to 02

Kerala Sales tax Act, 1963 Sales Tax 1998-99

Kerala Sales tax Act, 1963 Sales Tax 1997-98

Kerala VAT Act, 2003 Sales Tax 2011-12

Kerala VAT Act, 2003 Sales Tax 2012-13

Kerala VAT Act, 2003 Sales Tax 2005-06, 2013-14

Madhya Pradesh Commercial Sales Tax 2000-01 Tax Act, 1994

Madhya Pradesh Commercial Sales Tax 2010-11 Tax Act, 1994

Madhya Pradesh Commercial Sales Tax 2003 to 06, 2007 to 10 Tax Act, 1994

Maharashtra Value Added Tax Sales Tax 2008-09 Act, 2002

Name of the Statue Amount Forum where the (Rs. Mn) dispute is pending

Customs Act, 1962 7.12 Customs Excise & Service Tax Appellate Tribunal Haryana Land Development Tax Act, 2001 9.52 State Tax Tribunal

Himachal Pradesh Entry Tax Act, 2010 49.50 Asst. Excise & Taxation Commissioner

Karnataka Tax on Entry of Goods Act, 1979 8.92 High Court of Karnataka

MP Entry Tax Act, 1976 0.13 Asst. Commissioner, Entry Tax

MP Entry Tax Act, 1976 0.00 CG Appellate Board

MP Entry Tax Act, 1976 88.54 Madhya Pradesh High Court

MP Entry Tax Act, 1976 7.36 State Tax Tribunal

The Uttar Pradesh Tax on Entry of Goods Act, 2000 5.88 High Court Allahabad

The Uttar Pradesh Tax on Entry of Goods Act, 2000 2.08 Joint Commissioner (Appeals)

The Uttar Pradesh Tax on Entry of Goods Act, 2000 8.48 State Tax Tribunal

Uttar Pradesh Trade Tax Act, 1948 0.17 Additional Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 8.27 State Tax Tribunal

Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDEMENT) 0.57 High Court Nainital

Orissa Entry Tax Act, 1999 5.20 Hon''ble Supreme Court

The Jammu & Kashmir Entry Tax on Goods Act, 2000 77.42 Srinagar High Court

Rajasthan Tax On Entry Of Goods Into Local Areas Act, 1999 10.87 Rajasthan High Court

Income Tax Act, 1961 2,502.62 Assessing officer

Income Tax Act, 1961 14,755.56 Commissioner of Income Tax (Appeals)

Income Tax Act, 1961 0.32 Gujarat High Court

Income Tax Act, 1961 4.15 High Court of Karnataka

Income Tax Act, 1961 103.16 Income Tax Appellate Tribunal

Income Tax Act, 1961 371.71 Joint Commissioner of Income Tax (Appeals)

Central Sales Tax Act, 1956 3.92 Deputy Commissioner, Sales Tax

Delhi Sales Tax Act, 1975 89.21 Additional Commissioner (Appeals)

Delhi Value Added Tax Act, 2004 11.84 State Tax Tribunal

Gujarat Sales Tax Act, 1969 0.83 Assessing officer

Gujarat Sales Tax Act, 1969 7.04 State Tax Tribunal

Kerala Sales tax Act, 1963 0.06 Deputy Commissioner, Sales Tax

Kerala Sales tax Act, 1963 0.05 State Tax Tribunal

Kerala VAT Act, 2003 1.38 Asst. Commissioner, VAT

Kerala VAT Act, 2003 0.07 Commercial Tax Officer

Kerala VAT Act, 2003 0.52 Intelligence Officer

Madhya Pradesh Commercial Tax Act, 1994 0.31 CG Appellate Board

Madhya Pradesh Commercial Tax Act, 1994 2.14 Deputy Commissioner (Appeals)

Madhya Pradesh Commercial Tax Act, 1994 24.57 State Tax Tribunal

Maharashtra Value Added Tax Act, 2002 308.42 Deputy Commissioner, Sales Tax

Name of the Statute Nature of Period to which Dues the amount pertains

Punjab VAT Act, 2005 Sales Tax 2006 to 08

The Bihar Value Added Tax Act, 2005 Sales Tax 2010 to 13

The Bihar Value Added Tax Act, 2005 Sales Tax 2008-09

The Jammu & Kashmir General Sales Tax 2009 to 14 Sales Tax Act, 1962

Uttar Pradesh Value Added Sales Tax 2005-06, 2008 to 10 Tax Act, 2008

Uttar Pradesh Value Added Tax Act, 2008 Sales Tax 2012 to 14

Uttar Pradesh Value Added Tax Act, 2008 Sales Tax Apr-07 to Dec-07

Uttar Pradesh Value Added Tax Act, 2008 Sales Tax 2009 to 12, Apr-13 to Aug-13

Uttar Pradesh Value Added Tax Act, 2008 Sales Tax 2007-09, Jul-09 to Sept-09, Apr-12 to Jul-12

Finance Act, 1994 (Service Tax Service Tax 2005 to 07 and provisions) Apr-07 to Jul-07

Finance Act, 1994 (Service Tax Service Tax 2004-05, Apr-05 to Sep-06, provisions) 2004-Upto Dec-08, Oct-05 to Mar-06

Finance Act, 1994 (Service Tax Service Tax 2003 to 11, 2011 to Jun-12 provisions)

Finance Act, 1994 (Service Tax Service Tax Dec-07 to Mar-08 provisions)

Finance Act, 1994 (Service Tax Service Tax Oct-98 to Mar-99, Apr-02 to provisions) Sep-02, 2004 to 07

Name of the Statue Amount Forum where the (Rs. Mn) dispute is pending

Punjab VAT Act, 2005 61.56 Asst. Excise & Taxation Commissioner

The Bihar Value Added Tax Act, 2005 14.88 Joint Commissioner (Appeals)

The Bihar Value Added Tax Act, 2005 1.60 State Tax Tribunal

The Jammu & Kashmir General Sales Tax Act, 1962 188.76 Srinagar High Court

Uttar Pradesh Value Added Tax Act, 2008 0.38 Joint Commissioner (Appeals)

Uttar Pradesh Value Added Tax Act, 2008 3.86 Assessing officer

Uttar Pradesh Value Added Tax Act, 2008 2.73 High Court Allahabad

Uttar Pradesh Value Added Tax Act, 2008 8.79 Additional Commissioner (Appeals)

Uttar Pradesh Value Added Tax Act, 2008 10.70 State Tax Tribunal

Finance Act, 1994 (Service Tax provisions) 3.68 Commissioner of Central Excise & Service Tax (Appeals)

Finance Act, 1994 (Service Tax provisions) 58.82 Commissioner Service Tax

Finance Act, 1994 (Service Tax provisions) 1,330.93 Customs Excise & Service Tax Appellate Tribunal

Finance Act, 1994 (Service Tax provisions) 113.85 Joint Commissioner

Finance Act, 1994 (Service Tax provisions) 12.54 Punjab & Haryana High Court

10. The Company does not have accumulated losses at the end of the financial year and the Company has not incurred cash losses in the financial year and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of paragraph 4(xiii) of the said Order are not applicable to the Company.

14. According to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

17. In our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that funds raised on short term basis amounting to Rs. 32,343.29 Mn. have been used for long term investment.

18. According to information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Companies Act, 1956.

19. According to information and explanations given to us, the Company has not issued any debentures during the year.

20. According to information and explanations given to us, during the year covered by our audit report, the Company has not raised any money by public issue.

21. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year other than few cases of unauthorised services utilised by subscribers/ external parties valued at Rs. 73.38 Mn. (Approx) detected and appropriately dealt with by the Management.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm''s Registration No. 117366W/W-100018)

Khurshed Pastakia

(Partner)

(Membership No. 31544)

Place : Mumbai

Date : 28th April, 2014

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of IDEA CELLULAR LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2013;

(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Emphasis of Matter

a) We draw attention to Note 30 to the financial statement. The Division Bench of the Hon''ble High Court of Delhi on 13th July 2012 has reaffirmed High Court Order dated 5th February 2010 and 4th July 2011 sanctioning the Scheme of Amalgamation of Spice Communications Limited (Spice) with the Company. Further the Division Bench of the Hon''ble High Court of Delhi has also pronounced that the Department of Telecommunications (DoT) has to take decision regarding transfer of licenses held by erstwhile Spice to the Company arising out of amalgamation within a period of three months (which had been extended to 5th January 2013 vide order dated 11th December 2012) and dispute, if any, between the Company and DoT related to transfer of licenses should be referred to Hon''ble TDSAT for resolution.

The impact, if any, on the Company is dependent upon the steps to be taken by DoT in this regard.

b) We draw attention to Note 31 (i) to the financial statement. The DoT has issued demand notices dated 8th January 2013 towards one time spectrum charges for spectrum held by the Company beyond 6.2 Mhz for period from 1st July 2008 to 31st December 2012 amounting to Rs. 3,691.30 Mn. and beyond 4.4 Mhz for period from 1st January 2013 till the expiry of the license amounting to Rs. 17,443.70 Mn. in the respective telecom service areas. In the opinion of the Company, inter-alia, the above demand amounts to alteration of financial terms of the licenses issued in the past. The Company therefore filed a petition before the Hon''ble High Court of Bombay, which directed DoT to respond and not to take any coercive action until next date of hearing, which is scheduled for 6th May 2013.

The financial impact of the above mentioned matter is dependent upon the outcome of the petition filed by Company in the Hon''ble High Court of Bombay and therefore no effect for the one time spectrum charges has been given in these Financial Statements.

Our opinion is not qualified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by Section 227(3) of the Act, we report that:

(a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in Section 211(3C) of the Act.

(e) On the basis of the written representations received from the directors as on 31st March 2013 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2013 from being appointed as a director in terms of Section 274(1)(g) of the Act.

Annexure to the Auditors'' Report

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to information and explanation given to us the Management is in the process of reconciling the results of such physical verification with the fixed assets register. Management believes that differences if any, arising out of such reconciliation are not expected to be material.

c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventory:

a) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the Register maintained under section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, having regard to explanation that certain items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and for the rendering of services. During the course of our audit, we have not observed any major weaknesses in such internal control system.

5. In our opinion and according to the information and explanations given to us, there were no contracts or arrangements, particulars of which needed to be entered in the register maintained under section 301 of the Companies Act, 1956 and hence provisions of paragraph 4(v)(b) of the said Order relating to reasonableness of price having regard to prevailing market price is not applicable to the Company.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. According to information and explanations given to us, in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty and Investor Education and Protection Fund.

b) There were no undisputed amount payable in respect of Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues in arrears, as at 31st March 2013 for a period of more than six months from the date they became payable.

c) There are no dues of Wealth Tax and Cess which have not been deposited on account of any dispute. Details of dues of Income Tax, Sales Tax, Service Tax, Customs duty and Entry Tax which have not been deposited as on 31st March 2013 by the Company on account of disputes are given below:

Name of the Statute Nature of Period to which Dues the amount pertains

Customs Act, 1962 Custom Duty 2003-04

Haryana Land Development Entry Tax 2002-03 Tax Act, 2001

Himachal Pradesh Entry Entry Tax 2010-11 to 2012-13 Tax Act, 2010

Karnataka Tax on Entry of Entry tax 2004-05 Goods Act, 1979

MP Entry Tax Act, 1976 Entry Tax 1998-99 to 2005-06

MP Entry Tax Act, 1976 Entry Tax 1998-99 to 2000-01

MP Entry Tax Act, 1976 Entry Tax 2005-06 to 2007-08, 2009-10

MP Entry Tax Act, 1976 Entry Tax 2006-07 to 2008-09, 2010-11

Orissa Entry Tax Act, 1999 Entry Tax 2008-09, 2009-10

Name of the Statute Amount Forum where the (Rs. Mn.) dispute is pending

Customs Act, 1962 7.12 Customs Excise & Service Tax Appellate Tribunal

Haryana Land Development Tax Act 2001 9.52 Appellate Tribunal

Himachal Pradesh Entry Tax Act 2010 36.44 Asst. Excise & Taxation Commisioner, Shimla

Karnataka Tax on Entry of Goods Act 1979 8.92 Karnataka High Court

MP Entry Tax Act 1976 11.82 Commercial Tax Tribunal- Madhya Pradesh

MP Entry Tax Act 1976 0.13 Asst. Commissioner, Entry Tax

MP Entry Tax Act 1976 34.14 Madhya Pradesh High Court

MP Entry Tax Act 1976 35.20 Deputy Commissioner (Appeals)

Orissa Entry Tax Act, 1999 5.20 Orissa High Court

10. The Company does not have accumulated losses at the end of the financial year and the Company has not incurred cash losses in the financial year and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of paragraph 4(xiii) of the said Order are not applicable to the Company.

14. In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions. Therefore, the provisions of paragraph 4 (xv) of the said Order are not applicable to the Company.

16. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

17. In our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that funds raised on short term basis amounting to Rs. 20,766.26 Mn. have been used for long term investment.

18. According to information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Companies Act, 1956.

19. According to information and explanations given to us, during the year covered by our audit report, the Company had issued 1,000 debentures of Rs. 10 Mn. each. The Company has created security in respect of the debentures issued.

20. According to information and explanations given to us, during the year covered by our audit report, the Company has not raised any money by public issue.

21. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no fraud on the Company has been noticed or reported during the year other than few cases of unauthorised services utilised by external parties valued at Rs. 13.13 Mn. (Approx) detected and appropriately dealt with by the Management.

For Deloitte Haskins & Sells

Chartered Accountants

(Registration No. 117 366W)

Khurshed Pastakia

Partner

(Membership No: 31544)

Place: Mumbai

Date : April 25, 2013

Mar 31, 2012

1. We have audited the attached Balance Sheet of Idea Cellular Limited ('the Company') as at March 31, 2012, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date, both annexed thereto (together referred to as 'financial statements'). These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. Without qualifying our opinion, we draw attention to Note 30 to the financial statements, the Hon'ble Supreme Court of India, vide judgment dated February 2, 2012 has quashed the Press Release dated January 10, 2008 issued by the Department of Telecommunications (DoT) and consequent grant of 122 licenses. The company and erstwhile Spice have been issued 9 and 4 licenses respectively in January, 2008 which have been cancelled due to the above mentioned order of the Hon'ble Supreme Court.

Of the 13 licenses, 7 licenses are being operated by the Company and balance 6 overlapping licenses have been impaired in previous financial years. Vide a further order dated April 24, 2012 the Supreme Court has allowed the company to operate these licenses upto September 7, 2012. The impact, if any, on the operations of the said 7 service areas and on the carrying values of these licenses as on March 31, 2012 amounting to Rs 2,778 Mn, is dependent upon the steps taken by DoT and outcome of the auction.

4. Without qualifying our opinion, we draw attention to Note 32 to the financial statements, the Hon'ble High Court of Delhi on July 4, 2011 has reaffirmed its order dated February 5, 2010 sanctioning the Scheme of Amalgamation of Spice Communications Limited (Spice) with the Company. However the judgment transferred & vested unto the Department of Telecommunications (DoT), the six telecom licenses granted to erstwhile Spice along with the spectrum (including two operational licenses for Punjab & Karnataka service areas) till the time permission of DoT is granted for transfer thereof upon an application from the Company to that effect. The Company has filed an appeal before the Appellate Bench of Hon'ble High Court of Delhi, challenging the above judgment dated July 4, 2011.The Appellate Bench of Hon'ble High Court of Delhi through interim order has directed DoT to maintain status quo in respect of the two operational licenses for Punjab & Karnataka and not to take any coercive action for remaining four non-operational licenses. The Appellate Bench of Hon'ble High Court of Delhi has reserved the judgment on the said matter.

Since the matter is sub-judice, the outcome of which is uncertain at this stage, we are unable to comment on the consequential impact, if any, on the financial statements.

5. As required by the Companies (Auditor's Report) Order, 2003, ('the said Order'/'CARO') issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

6. Further to our comments in paragraph 3 and 4 above and the Annexure referred to in paragraph 5 above, we report as follows:

(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

(e) in our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with the notes thereon give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2012;

(ii) in the case of the Statement of Profit and Loss, of the Profit of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

7. On the basis of the written representations received from the Directors as on March 31, 2012 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2012 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

Annexure to the Auditors' Report (Referred to in paragraph 5 of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The fixed Assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to information and explanation given to us the Management is in the process of reconciling the results of such physical verification with the fixed assets register. Management believes that differences if any, arising out of such reconciliation are not expected to be material.

c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventory:

a) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to/from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, having regard to explanation that certain items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in such internal control systems.

5. In our opinion and according to the information and explanations given to us, there were no contracts, particulars of which needed to be entered in the register maintained under section 301 of the Companies Act, 1956 and hence provisions of paragraph 4(v)(b) of the said Order relating to reasonableness of price having regard to prevailing market price is not applicable to the Company.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 in respect of telecommunication activities and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

9. According to information and explanations given to us in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty and Investor Education and Protection Fund.

b) There were no undisputed amount payable in respect of Income Tax, Wealth Tax, Customs Duty, Cess and other material statutory dues in arrears, as at March 31, 2012 for a period of more than six months from the date they became payable.

c) There are no dues of Wealth Tax and Cess which have not been deposited on account of any dispute. Details of dues of Income Tax, Sales Tax, Service Tax, Customs duty and Entry Tax which have not been deposited as on March 31, 2012 by the Company on account of disputes.

Name of the Statute Nature of Period to which Amount Forum where the Dues the amount pertains (Rs Mn) dispute is pending

Customs Act, 1962 Custom Duty 2003-04 7.12 Customs Excise & Service Tax Appellate Tribunal

Haryana Land Development Entry Tax 2002-03 9.52 Appellate Tribunal Tax Act, 2001

Himachal Pradesh Entry Entry Tax 2010-11, 2011-12 25.45 Asst. Excise & Taxation Tax Act, 2010 Commissioner, Shimla

Karnataka Tax on Entry of Entry tax 2004-05 8.92 Karnataka High Court Goods Act, 1979

MP Entry Tax Act, 1976 Entry Tax 1998-99 to 2000-01 0.13 Asst.Commissioner, Entry Tax

MP Entry Tax Act, 1976 Entry Tax 1998-99 to 2006-07 14.85 Commercial Tax Tribunal - Madhya Pradesh

MP Entry Tax Act, 1976 Entry Tax 2007-08 21.51 Deputy Commissioner (Appeals)

Orissa Entry Tax Act, 1999 Entry Tax 2009-10 5.20 Orissa High Court

The Bihar Value Added Tax Act, 2005 Entry Tax 2007-08, 2009-10 1.77 Commercial Tax Officer

The Jammu & Kashmir Entry Tax Entry Tax 2009-10 to 2011-12 81.30 Srinagar High Court on Goods Act, 2000

The Uttar Pradesh Tax on Entry Entry Tax 1999-00, 2001-02, 9.13 Allahabad High Court of Goods Act, 2000 2002-03, 2003-04, 2006-07

The Uttar Pradesh Tax on Entry Entry tax 2007-08 8.29 Assessing Officer, of Goods Act, 2000 Joint Commissioner

The Uttar Pradesh Tax on Entry Entry Tax 2007-08 2.03 Commercial Tax Tribunal of Goods Act, 2000

The Uttar Pradesh Tax on Entry Entry Tax 2004-05 2.08 Joint Commissioner (Appeals) of Goods Act, 2000

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2005-06 0.30 Joint Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2001-02 to 2003-04 0.57 Uttarakhand High Court (Uttrakhand Amendment)

Income Tax Act, 1961 Income Tax 2008-09, 2011-12 29.15 Assistant Commissioner of Income Tax (TDS)

Income Tax Act, 1961 Income Tax 2002-03 to 2011-12 682.91 Commissioner of Income Tax (Appeals)

Income Tax Act, 1961 Income Tax 2003-04 to 2009-10 60.47 Income Tax Appellate Tribunal

Income Tax Act, 1961 Income Tax 2007-08, 2008-09 0.28 Income Tax Officer - TDS

Income Tax Act, 1961 Income Tax 2002-03 to 2004-05 4.15 Karnataka High Court

Central Sales Tax Act, 1956 Sales Tax 2009-10 0.63 Commercial Tax Officer

Delhi Sales Tax Act, 1975 Sales Tax 2003-04, 2004-05 92.74 Additional Commissioner (Appeals)

Delhi Value Added Tax Act, 2004 Sales Tax 2007-08 14.05 Delhi Value Added Tax Appellate Tribunal

Gujarat Sales Tax Act, 1969 Sales Tax 1998-99 to 2001-02 7.04 Sales Tax Appellate Tribunal

Gujarat Sales Tax Act, 1969 Sales Tax 2006-07 0.83 Sales Tax Officer

Kerala Sales Tax Act, 1963 Sales Tax 1998-99 0.06 Deputy Commissioner, Sales Tax

Kerala Sales Tax Act, 1963 Sales Tax 1997-98, 2000-01 0.20 Sales Tax Appellate Tribunal

Madhya Pradesh Commercial Tax Sales Tax 2000-01 0.31 CG Appellate Board Act, 1994

Madhya Pradesh Commercial Tax Sales Tax 2003-04 to 2007-08 26.77 Commercial Tax Tribunal - Act, 1994 Madhya Pradesh

Punjab VAT Act, 2005 Sales Tax 2006-07, 2007-08 61.56 Asst. Excise & Taxation Commissioner, Chandigarh

The Bihar Value Added Tax Act, 2005 Sales Tax 2008-09 3.40 Joint Commissioner, Commerial Tax (Appeals) Department, Patna

The Jammu & Kashmir General Sales Tax 2009-10 to 2011-12 56.59 Srinagar High Court Sales Tax Act, 1962

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2007-08 2.54 Allahabad High Court

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2004-05 0.05 Joint Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 1999-00, 2000-01, 2006-07, 5.18 Trade Tax Tribunal 2007-08, 2008-09

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2007-08, 2009-10 1.75 Deputy Commissioner, Sales Tax (Uttrakhand Amendment)

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2006-07 1.04 Joint Commissioner (Appeals) (Uttrakhand Amendment)

Uttar Pradesh Value Added Sales Tax 2007-08 0.22 Additional Commissioner (Appeals) Tax Act, 2008

Uttar Pradesh Value Added Sales Tax 2006-07, 2007-08, 2009-10 34.13 Commercial Tax Tribunal Tax Act, 2008 Bench II Lucknow

Uttar Pradesh Value Added Sales Tax 2009-10 5.48 Deputy Commissioner (Appeals) Tax Act, 2008

Uttar Pradesh Value Added Sales Tax 2011-12 0.32 Joint Commissioner (Appeals) Tax Act, 2008

Finance Act, 1994 Service tax 2005-06, 2006-07, 2007-08 8.19 Commissioner of Central Excise (Service Tax provisions) (Appeals)

Finance Act, 1994 Service tax 2004-05, 2005-06 7.36 Commissioner of Service Tax (Service Tax provisions)

Finance Act, 1994 Service Tax 2004-05 to 2009-10 1,186.93 Customs Excise & Service Tax (Service Tax provisions) Appellate Tribunal

Finance Act, 1994 Service Tax 1998-99, 2002-03 2.98 Punjab & Haryana High Court (Service Tax provisions)

10. The Company does not have accumulated losses at the end of the financial year and the Company has not incurred cash losses in the financial year and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks and financial institutions.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of paragraph 4 (xiii) of the said Order are not applicable to the Company.

14. In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions. Therefore, the provisions of paragraph 4 (xv) of the said Order are not applicable to the Company.

16. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

17. In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, we report that funds raised on the short term basis have not been used during the year for long term investment.

18. According to information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. According to information and explanations given to us, the Company has not issued any debentures during the year.

20. According to information and explanations given to us, during the year covered by our audit report, the Company has not raised any money by public issue.

21. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For Deloitte Haskins & Sells

Chartered Accountants

(Registration No. 117 366W)

Hemant M. Joshi

Partner

(Membership No.: 38019)

Place : Mumbai

Date : April 26, 2012

Mar 31, 2011

1. We have audited the attached Balance Sheet of Idea Cellular Limited ('the Company') as at March 31, 2011, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, both annexed thereto (together referred to as 'financial statements'). These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, ('the said Order' / 'CARO') issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

4. Without qualifying our opinion, we draw attention to note 2 of schedule 22 B to the financial statements, the Hon'ble High Court of Delhi on July 4, 2011 has reaffirmed its order dated February 5, 2010 sanctioning the Scheme of Amalgamation of Spice Communications Limited (Spice) with the Company. However the judgment transferred & vested unto the Department of Telecommunications (DoT), the six telecom licenses granted to erstwhile Spice along with the spectrum (including two operational licenses for Punjab & Karnataka service areas) till the time permission of DoT is granted for transfer thereof upon an application from the Company to that effect.

The Company has filed an appeal before the Appellate Bench of Hon'ble High Court of Delhi, challenging the above judgment dated July 4, 2011.The Appellate Bench of Hon'ble High Court of Delhi through interim order has directed DoT to maintain status quo in respect of the two operational licenses for Punjab & Karnataka and not to take any coercive action for remaining four non-operational licenses, till the next date of hearing.

Since the matter is sub-judice, the outcome of which is uncertain at this stage, we are unable to comment on the consequential impact, if any, on the financial statements.

5. Further to our comments in the Annexure referred to in paragraph 3 above, we report as follows:

(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

(e) in our opinion and to the best of our information and according to the explanations given to us and read with our comments in Para 4 above, the said financial statements read together with the notes thereon give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011;

(ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

6. On the basis of the written representations received from the Directors as on March 31, 2011 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2011 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

Annexure to the Auditors' Report

(Referred to in paragraph 3 of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to information and explanation given to us the Management is in the process of reconciling the results of such physical verification with the fixed assets register. Management believes that differences if any, arising out of such reconciliation are not expected to be material.

c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventory:

a) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, having regard to explanation that certain items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard

to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in such internal controls systems.

5. In our opinion and according to the information and explanations given to us, there were no contracts, particulars of which needed to be entered in the register maintained under section 301 of the Companies Act, 1956 and hence provisions of paragraph 4(v)(b) of the said Order relating to reasonableness of price having regard to prevailing market price is not applicable to the Company.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 in respect of telecommunication activities and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

9. According to information and explanations given to us in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise Duty and Investor Education and Protection Fund.

b) There were no undisputed amount payable in respect of Income Tax, Wealth Tax, Customs Duty, Cess and other material statutory dues in arrears, as at March 31, 2011 for a period of more than six months from the date they became payable.

c) There are no dues of Wealth Tax and Cess which have not been deposited on account of any dispute. Details of dues of Income Tax, Sales Tax, Service Tax, Customs duty and Entry Tax which have not been deposited as on March 31, 2011 by the Company on account of disputes:

Name of the Statute Nature of Period to which Dues the amount pertains

Income Tax Act, 1961 Income Tax 2007-08, 2008-09

Income Tax Act, 1961 Income Tax 2002-03 to 2010-11

Income Tax Act, 1961 Income Tax 2007-08, 2008-09

Income Tax Act, 1961 Income Tax 2003 to 2010

Income Tax Act, 1961 Income Tax 2002-03 to 2004-05

Income Tax Act, 1961 Income Tax 2007-08

Andhra Pradesh General Sales Tax 1997-98, 2002-03, Sales Tax Act, 1957 2003-04, 2004-05

Andhra Pradesh Value Sales Tax 2005-06 to 2007-08 Added Tax, 2005

Delhi Sales Tax Act, 1975 Sales Tax 2003-04, 2004-05

Gujarat Sales Tax Act, 1969 Sales Tax 1998-99 to 2001-02

Gujarat Sales Tax Act, 1969 Sales Tax 2006-07

Kerala Sales Tax Act, 1963 Sales Tax 1997-98

Kerala Sales Tax Act, 1963 Sales Tax 1998-99

Madhya Pradesh Commercial Sales Tax 2004-05, 2007-08 Tax Act, 1994

Madhya Pradesh Commercial Sales Tax 2000-01 Tax Act, 1994

Madhya Pradesh Commercial Sales Tax 2003-04 to 2006-07 Tax Act, 1994

Punjab VAT Act, 2005 Sales Tax 2006-07, 2007-08

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 1999-00, 2001-02, 2004-05, 2007-08

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2007-08 (UTTRAKHAND AMENDEMENT)

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2006-07 (UTTRAKHAND AMENDEMENT)

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2007-08

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2006-07

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2002-03, 2007-08, 2008-09

Uttar Pradesh Value Sales Tax 2006-07, 2007-08, Added Act, 2008 2009-10

Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2007-08

Finance Act, 1994 Service Tax 2003-04 to 2009-10 (Service Tax provisions)

Finance Act, 1994 Service Tax 2003-04 to 2007-08 (Service Tax provisions)

Finance Act, 1994 Service Tax 1998-99, 2002-03 (Service Tax provisions)

Finance Act, 1994 Service Tax 1999-00 to 2003-04 (Service Tax provisions)

Finance Act, 1994 Service Tax 2006-07 (Service Tax provisions)

Customs Act, 1962 Custom Duty 2003-04

Haryana Land Development Entry Tax 2002-03 Tax Act.2001

Name of the Statute Amount Forum where the (Rs. Mn) dispute is pending

Income Tax Act, 1961 11.37 Assistant Commissioner of Income Tax

Income Tax Act, 1961 232.18 Commissioner of Income Tax (Appeals)

Income Tax Act, 1961 29.29 Income Tax Officer Ã TDS

Income Tax Act, 1961 128.38 Income Tax Appellate Tribunal

Income Tax Act, 1961 4.15 Karnataka High Court

Income Tax Act, 1961 13.56 Commissioner Of Appeal-III Lucknow

Andhra Pradesh General Sales Tax Act, 1957 227.46 Andhra Pradesh High Court

Andhra Pradesh Value Added Tax, 2005 103.66 Andhra Pradesh High Court

Delhi Sales Tax Act, 1975 92.74 Additional Commissioner (Appeals)

Gujarat Sales Tax Act, 1969 7.04 Sales Tax Appellate Tribunal

Gujarat Sales Tax Act, 1969 0.83 Assessing officer

Kerala Sales Tax Act, 1963 0.05 Sales Tax Appellate Tribunal

Kerala Sales Tax Act, 1963 0.06 Deputy Commissioner, Sales Tax

Madhya Pradesh Commercial Tax Act, 1994 19.70 Deputy Commissioner, Appeal

Madhya Pradesh Commercial Tax Act, 1994 0.31 CG Appellate Board

Madhya Pradesh Commercial Tax Act, 1994 10.59 Commercial Tax Tribunal - Madhya Pradesh

Punjab VAT Act, 2005 61.56 Assistant Excise & Taxation Commissioner, Chandigarh

Uttar Pradesh Trade Tax Act, 1948 3.48 Joint Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDEMENT) 1.69 Deputy Commissioner, Sales Tax

Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDEMENT) 0.94 Joint Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 1.10 Additional Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 3.39 Joint Commissioner

Uttar Pradesh Trade Tax Act, 1948 1.02 Trade Tax Tribunal

Uttar Pradesh Value Added Act, 2008 34.13 Commercial Tax Tribunal Bench II Lucknow

Uttar Pradesh Trade Tax Act, 1948 2.73 Allahabad High Court

Finance Act, 1994 (Service Tax provisions) 1,203.79 Customs Excise & Service Tax Appellate Tribunal

Finance Act, 1994 (Service Tax provisions) 8.94 Commissioner of Central Excise (Appeals)

Finance Act, 1994 (Service Tax provisions) 2.98 Punjab & Haryana High Court

Finance Act, 1994 (Service Tax provisions) 3.10 Supreme Court

Finance Act, 1994 (Service Tax provisions) 34.53 Assessing Officer, Commissioner Central Excise & Service Tax

Customs Act, 1962 7.12 Customs Excise & Service Tax Appellate Tribunal

Haryana Land Development Tax Act.2001 9.52 Tribunal

Name of the Statute Nature of Period to which Dues the amount pertains

Karnataka Tax on Entry of Entry Tax 2004-05 Goods Act, 1979

MP Entry Tax Act, 1976 Entry Tax 1998-99 to 2000-01

MP Entry Tax Act, 1976 Entry Tax 1998-99 to 2006-07

MP Entry Tax Act, 1976 Entry Tax 2005-06 to 2007-08

Orissa Entry Tax Act, 1999 Entry Tax 2008-09, 2009-10

Rajasthan Tax On Entry Of Entry Tax 2008-09 Goods Into Local Areas Act, 1999

The Uttar Pradesh Tax on Entry of Entry Tax 2007-08 Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry Tax 2006-07 Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry Tax 2004-05 Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry Tax 1999-00, 2001-02 to Goods Act, 2000 2003-04, 2007-08

Uttar Pradesh Trade Tax Act, 1948 Entry Tax 2001-02,2002-03, (UTTRAKHAND AMENDEMENT) 2003-04

The Uttar Pradesh Tax on Entry of Entry Tax 2007-08 Goods Act, 2000

Bihar Value Added Tax Act, 2005 Entry Tax 2009-10

Name of the Statute Amount Forum where the (Rs. Mn) dispute is pending

Karnataka Tax on Entry of Goods Act, 1979 8.92 Karnataka High Court

MP Entry Tax Act, 1976 0.13 Assistant Commissioner, Entry Tax

MP Entry Tax Act, 1976 14.72 Commercial Tax Tribunal - Madhya Pradesh

MP Entry Tax Act, 1976 22.47 Deputy Commissioner (Appeal)

Orissa Entry Tax Act, 1999 5.20 Orissa High Court

Rajasthan Tax On Entry Of Goods Into Local Areas Act, 1999 2.41 Rajasthan High Court

The Uttar Pradesh Tax on Entry of Goods Act, 2000 2.03 Additional Commissioner (Appeals)

The Uttar Pradesh Tax on Entry of Goods Act, 2000 0.22 Deputy Commissioner

The Uttar Pradesh Tax on Entry of Goods Act, 2000 2.08 Joint Commissioner (Appeals), Commercial Tax.

The Uttar Pradesh Tax on Entry of Goods Act, 2000 11.18 Trade Tax Tribunal

Uttar Pradesh Trade Tax Act, 1948 (UTTRAKHAND AMENDEMENT) 0.57 Uttarakhand High Court

The Uttar Pradesh Tax on Entry of Goods Act, 2000 6.00 Joint Commissioner (Appeals)

Bihar Value Added Tax Act, 2005 1.73 Joint Commissioner (Appeals), Commercial Tax.

10. The Company does not have accumulated losses at the end of the financial year and the Company has not incurred cash losses in the financial year and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks and financial institutions.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of paragraph 4(xiii) of the said Order are not applicable to the Company.

14. In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions. Therefore, the provisions of paragraph 4 (xv) of the said Order are not applicable to the Company.

16. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

17. In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, we report that funds raised on the short term basis amounting to Rs. 16,457 Mn have been used during the year for long term investment.

18. According to information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. According to information and explanations given to us, the Company has not issued any debentures during the year.

20. According to information and explanations given to us, during the year covered by our audit report, the Company has not raised any money by public issue.

21. According to the information and explanations furnished by the Management, which have been relied upon by us, there were no frauds on or by the Company noticed or reported during the course of our audit except few cases of fraud by employees and by external parties estimated at Rs. 0.92 Mn detected by the Management for which appropriate steps were taken to strengthen controls.

For Deloitte Haskins & Sells

Chartered Accountants (Registration No. 117 366W)

Hemant M. Joshi

Partner

(Membership No.: 38019)

Place: Mumbai

Date: July 29, 2011

Mar 31, 2010

1. We have audited the attached Balance Sheet of Idea Cellular Limited (the Company) as at March 31, 2010, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, both annexed thereto (together referred to as financial statements). These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003, (the said Order / CARO) issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report as follows:

(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

(e) in our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with the notes thereon give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2010;

(ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

5. On the basis of the written representations received from the Directors as on March 31, 2010 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2010 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

Annexure to the Auditors Report (Referred to in paragraph 3 of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The fixed Assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to information and explanation given to us the Management is in the process of reconciling the results of such physical verification with the fixed assets register. Management believes that differences if any, arising out of such reconciliation are not expected to be material.

c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventory:

a) As explained to us, the inventories, except for those lying with the third parties, were physically verified during the year by the Management at reasonable intervals.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, having regard to explanation that certain items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in such internal controls systems.

5. In our opinion and according to the information and explanations given to us, there were no contracts, particulars of which needed to be entered in the register maintained under Section 301 of the Companies Act, 1956 and hence provisions of paragraph 4(v)(b) of the said Order relating to reasonableness of price having regard to prevailing market price is not applicable to the Company.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 in respect of telecommunication activities and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

9. According to information and explainations given to us in respect of statutory dues:

a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty and Investor Education and Protection Fund.

b) There were no undisputed amount payable in respect of Income Tax, Wealth Tax, Customs Duty, Excise Duty, Cess and other material statutory dues in arrears, as at March 31, 2010 for a period of more than six months from the date they became payable.

c) There are no dues of Excise Duty, Wealth Tax, Employees State Insurance which have not been deposited on account of any dispute. Details of dues of Income Tax, Customs Duty, Entry Tax, Service Tax and Sales Tax which have not been deposited as on March 31, 2010 by the Company on account of disputes:

Name of the Statute Nature of Period to which Dues the amount pertains

Income Tax Act, 1961 Income tax 2006-07, 2007-08, 2008-09, 2009-10

Income Tax Act, 1961 Income tax 2003 to 2010

Income Tax Act, 1961 Income tax 2002-03, 2004-05,

2008-09, 2009-10

Andhra Pradesh General Sales tax 1997-98, 2002-03 Sales Tax Act, 1957 to 2004-05

Andhra Pradesh Value Sales tax 2005-06 to 2007-08 Added Tax, 2005

Delhi Sales Tax Act, 1975 Sales tax 2002-03, 2003-04, 2004-05

Uttar Pradesh Trade Tax Act, 1948 Sales tax 2004-05

Gujarat Sales Tax Act, 1969 Sales tax 1998-99 to 2001-02

Gujarat Sales Tax Act, 1969 Sales tax 2006-07

Kerala Sales Tax, 1963 Sales tax 1997-98

Kerala Sales Tax, 1963 Sales tax 1998-99

Kerala Sales Tax, 1963 Sales tax 2000-01

Madhya Pradesh Commercial Sales tax 2004-05, 2005-06, Tax Act, 1994 2006-07

Madhya Pradesh Commercial Sales tax 2000-01 Tax Act, 1994

Madhya Pradesh Commercial Sales tax 2004-05 Tax Act, 1994

Madhya Pradesh Commercial Sales tax 2003-04, 2004-05 Tax Act, 1994

Punjab VAT Act, 2005 Sales tax 2006-07, 2007-08

Uttar Pradesh Trade Tax Act, 1948 Sales tax 1999-00, 2000-01, 2002-03, 2007-08

Uttar Pradesh VAT Act, 2008 Sales tax 2009-10

Finance Act, 1994 Service tax 2004-05 to 2008-09 (Service Tax provisions)

Finance Act, 1994 Service tax 2003-04, 2005-06,

(Service Tax provisions) 2006-2007, 2007-08

Finance Act, 1994 Service tax 1998-99, 2002-03 (Service Tax provisions)

Finance Act, 1994 Service tax 1999-2000 (Service Tax provisions) to 2003-04

Customs Act, 1962 Custom duty 2003-04

Customs Act, 1962 Custom duty 2003-04

Haryana Land Deve lopement Tax Entry tax 2002-03 Act, 2001

Karnataka Tax on Entry of Entry tax 2004-05 Goods Act, 1979

MP Entry Tax Act, 1976 Entry tax 2003-04 to 2005-06

Name of the Statue Amount Forum where the (Rs. Million) dispute is pending

Income Tax Act, 1961 106.84 Assessing Officer

Income Tax Act, 1961 51.41 Assistant Commissioner of Income Tax

Income Tax Act, 1961 396.10 Commissioner of Income Tax (Appeals)

Andhra Pradesh General Sales Tax Act, 1957 227.46 Andhra Pradesh High Court

Andhra Pradesh Value Added Tax, 2005 81.95 Andhra Pradesh High Court

Delhi Sales Tax Act, 1975 92.74 Additional Commissioner (Appeals)

Uttar Pradesh Trade Tax Act, 1948 0.05 Joint Commissioner (Appeals)

Gujarat Sales Tax Act, 1969 7.04 Sales Tax Tribunal

Gujarat Sales Tax Act, 1969 0.83 Assessing Officer

Kerala Sales Tax, 1963 0.39 Sales Tax Appellate Tribunal

Kerala Sales Tax, 1963 0.06 Deputy Commissioner, Sales Tax

Kerala Sales Tax, 1963 16.05 Kerala High Court

Madhya Pradesh Commercial Tax Act, 1994 15.36 Appellate Deputy Commissioner

Madhya Pradesh Commercial Tax Act, 1994 0.31 Appellate Board

Madhya Pradesh Commercial Tax Act, 1994 2.50 Commissioner Appeals

Madhya Pradesh Commercial Tax Act, 1994 1.97 MP Commercial Tax Tribunal, Bhopal

Punjab VAT Act, 2005 61.56 Asstt.Excise & Taxation Commissioner

Uttar Pradesh Trade Tax Act, 1948 11.72 Trade Tax Tribunal

Uttar Pradesh VAT Act, 2008 13.03 Joint Commissioner (Appeals)

Finance Act, 1994 (Service Tax provisions) 625.65 Central Excise Service Tax Appellate Tribunal

Finance Act, 1994 (Service Tax provisions) 45.14 Commissioner Appeals

Finance Act, 1994 (Service Tax provisions) 2.98 Punjab & Haryana High Court

Finance Act, 1994 (Service Tax provisions) 3.10 Supreme Court

Customs Act, 1962 1.15 Cenrtal Excise Service Tax Appellate Tribunal

Customs Act, 1962 4.16 Commissioner of Customs

Haryana Land Developement Tax Act, 2001 9.52 Tribunal

Karnataka Tax on Entry of Goods Act, 1979 8.92 High Court of Karnataka

MP Entry Tax Act, 1976 5.19 Appellate Deputy Commissioner

Name of the Statute Nature of Period to which Dues the amount pertains

MP Entry Tax Act, 1976 Entry tax 1998-99,1999-2000, 2000-01

MP Entry Tax Act, 1976 Entry tax 2005-06

MP Entry Tax Act, 1976 Entry tax 1998-99 to 2002-03

Orissa Entry Tax Act, 1999 Entry tax 2009-2010

Uttar Pradesh Trade Tax Act, 1948 Entry tax 2005-06

The Uttar Pradesh Tax on Entry of Entry tax 1999-00 to 2003-04 Goods Act, 2000

The Uttar Pradesh Tax on Entry of Entry tax 2004-05 Goods Act, 2000

Uttar Pradesh Trade Tax Act, 1948 Entry tax 2001-02 to 2003-04

Name of the Statue Amount Forum where the (Rs. Million) dispute is pending

MP Entry Tax Act, 1976 0.13 Assistant Commissioner

MP Entry Tax Act, 1976 3.20 Commissioner Appeals

MP Entry Tax Act, 1976 7.94 Madhya Pradesh Commercial Tax Tribunal

Orissa Entry Tax Act, 1999 5.20 High Court of Orissa

Uttar Pradesh Trade Tax Act, 1948 0.30 Joint Commissioner (Appeals)

The Uttar Pradesh Tax on Entry of Goods Act, 2000 8.89 Trade Tax Tribunal

The Uttar Pradesh Tax on Entry of Goods Act, 2000 5.15 Joint Commissioner

Uttar Pradesh Trade Tax Act, 1948 1.14 Joint Commissioner

10. The accumulated losses of the Company are less than fifty percent of its net worth and the Company has not incurred cash losses during the current financial year covered by our audit and the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to the financial institutions and banks.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of paragraph 4(xiii) of the said Order are not applicable to the Company.

14. In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions. Therefore, the provisions of paragraph 4 (xv) of the said Order are not applicable to the Company.

16. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

17. In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, we report that funds raised on the short term basis have not been used during the year for long term investment.

18. According to information and explainations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

19. According to information and explainations given to us, the Company has not issued any debentures during the year.

20. According to information and explainations given to us, the Company has not raised any money by public issue.

21. According to the information and explanations furnished by the Management, which have been relied upon by us, there were no frauds on or by the Company noticed or reported during the course of our audit except few cases of fraud by employees and by external parties estimated at Rs. 51 Million detected by the Management for which appropriate steps were taken to strengthen controls.

For Deloitte Haskins & Sells

Chartered Accountants (Registration No. 117 366W)

Hemant M. Joshi

Partner

(Membership No: 38019)

Place: Mumbai Date: May 3, 2010

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