Enter the first few characters of Company and click 'Go'

Notes to Accounts of Reliance Communications Ltd.

Mar 31, 2023

2.01.1 Capital Work-in-Progress includes ? 8 crore (Previous year ? 8 crore) on account of materials at site.

2.01.2 Transfer of title of certain Land and Buildings received from Reliance Industries Limited pursuant to the Scheme of Arrangement and from Reliance Communications Infrastructure Limited (''RCIL) pursuant to scheme of demerger of the Network division are under process.

2.01.3 Refer Note 2.1 9 for Security in favour of the Lenders. Foreign Currency Loans of? 1,623 crore availed by Reliance Infratel Limited ('' RITLâ) (ceased w.e.f. December 22, 2022) and Foreign Currency Loans of? 1,341 crore availed by Reliance Telecom Limited (''RTL'') are secured by f rst pari passu charge on movable PPE of the Borrower Group. Apart from this, Rupee Loan of ? 91 8 crore availed by RITL (ceased w.e.f December 22, 2022) have been secured by second pari passu charge and Rupee loan of ? 611 crore availed by RTL have been secured by first pari passu charge on movable Fixed Assets of the Borrower Group. Further non fund based outstanding of ? 1,361 crore availed by the Company, ? 246 crore availed by RTL and ? 4 crore by RCIL have been secured by second pari passu charge on movable Fixed Assets of the Borrower Group.

2.01.4 On finalisation and implementation of debt resolution process through Flon''ble NCLT, the Company will carry out a comprehensive impairment review of its tangible assets.

2.01.5 Plant and Machinery includes Gross Carring Value of ? 23 crore (Previous year ? 23 crore) and Net Carrying Value of ? 1 7 (Previous year ? 1 8 crore) as at March 31, 2023, pertaining to assets taken on lease.

2.01.6 Above notes to be read with Note 2.14 "Assets Field for Sale".

2.01.7 There is no Revaluation of Property, Plant and Equipments during the current and previous year.

2.02.1 During the earlier years, the Company had successfully Bid under auction conducted for spectrum by the Department of Telecommunications (DoT), Government of India (GoI) and won spectrum in 12 service areas as total cost of '' 1,934 crore. The Company has made upfront payment of '' 527 crore under deferred payment option and the balance was payable in 10 annual installments for Mumbai and Jammu and Kashmir circles and 16 annual installments for other Circles.

The Company has defaulted the payment of installment of '' 196 crore each, which was due on April 9, 2019, April 9, 2020, April 9, 2021 and April 9, 2022 with the delay of 1,453 days, 1,088 days, 722 days and 357 days respectively and '' 6 crore each, which was due on October 20, 2019, October 20, 2020, October 20, 21 and October 20, 2022 with the delay of 1,259 days, 893 days, 528 days and 163 days respectively. Further, an installment of '' 22 crore with respect to Mumbai circle which was due on March 03, 2019, March 3, 2020, March 03, 2021, March 03, 2022 and March 03, 2023 is defaulted by 1,490 days 1,124 days, 759 days, 394 days and 29 days respectively as at March 31, 2023. Apart from above, balance installments not due as at March 31, 2023 is aggregating to '' 2,251 crore including interest @10% per annum. An Installment of '' 196 crore, due on April 9, 2023 is yet to be paid.

During an earlier year, the Company acquired spectrum of '' 4,513 crore under Scheme of Demerger along with corresponding Deferred Payment Liability of '' 2,013 crore. (Refer Note No. 2.33.2). Above was payable in annual installments of '' 281 crore each.

The Company has defaulted the payment of installments of '' 281 crore each, which was due on March 26, 2019, March 26, 2020, March 26, 2021, March 26, 2022 and March 26, 2023 with the delay of 1,467 days, 1,102 days, 736 days, 371 days and 6 days respectively. Apart from the above, balance installments not due as at March 31, 2023 is aggregating to '' 2,253 crore including interest @ 10 % per annum.

Department of Telecommunications issued show cause notice to the Company for revocation/ termination of spectrum due to non-payment of 3^rd installment due on March 03, 2019 for 0.6 MHz Spectrum acquired in 1800 MHz band in Mumbai, which was stayed by the Hon''ble NCLAT. The said order of stay of NCLAT stood merged with its final order dated 30.04.2019 as a result of which RCOM''s CIRP got recommenced at NCLT Mumbai and order of Moratorium got restored. Further, in the matter of One Time Spectrum Charges, TDSATs order dated 04.02.2019 inter alia directing for the return of Bank Guarantee of '' 2,000 crore, has been stayed by Hon''ble Supreme court on 1 9.08.2019 in an appeal filed by Union of India.

* This investment has been considered as monetary item as per Ind AS 21 "The Effects of Changes in Foreign Exchange Rates" and hence, cost has been revalued at the year end foreign exchange rate.

** During the earlier year, impaired as per Ind AS 109, "Financial Instruments" (Refer note 2.39.1).

*** at fair value through Profit and Loss

# During an earlier year, since the Company and RITL are undergoing CIRP income in respect of Yield on Preference Shares amounting to '' 4 crore per year has not been recognised from FY 2019-20.

## Investment in Preference Shares of RCIL is due for Redemption on July 29, 2022. Since both RCIL and the Company are under IBC, the same could not be redeemed on the due date. Also, refer note 2.31.

Details of Shareholders holding more than 5% shares in the company

As on March 31, 2023, none of the shareholders are holding more than 5% shares in the company.

Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 5 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and Purpose of Reserve Capital Reserve

Capital Reserve includes Equity Share Capital of the Company, which was cancelled pursuant to the Scheme of Demerger of Undertaking from Reliance Industries Limited. During the year, Capital Reserve is created under scheme of demerger (Refer Note 2.33.2).

Debenture Redemption Reserve

Debenture Redemption Reserve is created out of profits of the respective year as required under the Act then applicable, which shall be utilised for the purpose of redemption of Debentures issued by the Company.

Securities Premium

Securities Premium represents the premium charged to the shareholders at the time of issuance of shares. It also includes '' 8,047 crore created pursuant to the Scheme of Amalgamation/ Arrangements of the earlier years. Securities Premium can be utilised based on the relevant requirements of the Act.

General Reserve I

General Reserve I of '' 5,538 crore (Previous year '' 5,538 crore) represents the unadjusted balance being the excess of assets over liabilities relatable to the Telecommunications Undertaking transferred and vested into the Company.

General Reserve II

General Reserve II comprises of ''4,159 crore transferred to General Reserve from Statement of Profit and Loss.

Treasury Equity

Treasury Equity represents 2,1 2,79,000 nos. of Equity Shares held by the ESOS Trust.

2.19.1 Debentures, Senior Secured Notes and Term Loans

The Company, on March 2, 2009, allotted, 3,000, 1 1.20% Secured Redeemable, Non Convertible Debentures ("NCDs") of the face value of '' 1,00,00,000 each, aggregating to '' 3,000 crore to be redeemed at the end of 10^th year from the date of allotment thereof i.e. March 1, 2019 and the same remains outstanding as at March 31, 2023. The Company on February 7, 2012, also allotted, 1,500, 1 1.25% Secured Redeemable Non Convertible Debentures ("NCDs") of the face value of '' 1,00,00,000 each aggregating to '' 1,500 crore redeemable in four annual equal installments starting at the end of 4^th year from the date of allotment thereof, the outstanding against said NCDs is '' 750 crore as on March 31, 2023. The Company had, on May 6, 2015, issued Senior Secured Notes (SCNs) of USD 300 million, face value of USD 100 per bond, bearing 6.5% p.a. interest, with a maturity of 5 1/2 years.

The Company had been sanctioned Rupee Loans of '' 6,015 crore (outstanding as on March 31,2023 was '' 5,463 crore) (Term Loan Facility) under consortium banking arrangement on the terms and conditions as set out in common loan agreement.

Outstanding NCDs along with SCNs, Foreign Currency Loans and Rupee Loans of '' 25,424 crore ("the said Secured Loans") have been secured by first pari passu charge on the whole of the movable plant and machinery including capital work in progress (pertaining to the movable fixed assets), both present and future including all the rights, title, interests, benefits, claims and demands in respect of all insurance contracts relating thereto of the Borrower Group*; comprising of the Company and its subsidiary companies namely; RTL, RITL ( ceased to be a subsidiary w.e.f December 22, 2022 upon implementation of the approved resolution plan, Refer Note 2.39 (a)) and RCIL, ("the Borrower Group*"), in favour of the Security Trustee for the benefit of the NCD/ SCN Holders and the lenders of the said Secured Loans. The said loans also include '' 3,583 crore which are guaranteed by a Director. Apart from above Rupee Loan also includes '' 398 crore which is secured by first pari passu charge on Spectrum, acquired during the earlier year under the scheme of demerger, (Refer Note 2.33.2) is pending to be executed. Outstanding Rupee Loan of '' 487 crore availed by the Company and '' 485 crore availed by RITL are secured by second pari passu charge on the movable plant and machinery and capital work in progress of the Borrower Group* and is guranteed by a director of the Company. During the previous year, the said loan was guaranteed by tower receivables, pledge of equity shares of Globalcom IDC Limited (''GIDC''), ceased to be a subsidiary w.e.f December 1 2, 2022, held by RWSL (Refer Note 2.32). Further, Outstanding Rupee Loans of '' 1,872 crore is secured by second charge over movable Fixed Assets of the Borrower Group*, out of which, charge is pending to be created for '' 1,072 crore. The Company, for the benefit of the Lenders of SCNs of '' 1,955 crore, Foreign Currency Loans of '' 11,191 crore, 11.25% NCDs aggregating to '' 750 crore and Rupee Loans of '' 7,403 crore has, apart from the above, also assigned 20 Telecom Licenses for services under Unified Access Services (UAS), National Long Distance (NLD) and International Long Distance (ILD) (collectively referred as "Telecom Licenses") by execution of the Tripartite Agreements with DoT and the Security Trustee acting on behalf of the Lenders. Further, assignment of the Telecom Licences of the Company for rupee loans from banks of '' 1,000 crore and from others of '' 740 crore is pending to be executed.

The Company has, for the benefit of the Lenders of SCNs, Foreign Currency Loans and Rupee Loans aggregating to '' 19,102 crore, apart from the above security, pledged equity shares of RCIL held by the Company and of RTL held by the Company and Reliance Reality Limited (''RRL'') by execution of the Share Pledge Agreement with the Share Pledge Security Trustee. Outstanding Rupee Loans of '' 5,463 crore is also secured by current assets, movable assets including intangible, both present and future of the Borrower Group*. During the previous year, the said loan was also secured by pledge of equity shares of RITL held by RCIL and during the year, the equity shares of RITL have been cancelled consequent to implementation of resolution plan of RITL on December 22, 2022 (Refer Note 2.39 (a)). During the earlier year, charge over the three immovable assets of the Borrower Group* was created. However charge over balance immovable assets of the Borrower Group* and RGBV security for Rupee Loans of '' 5,463 crore is pending to be executed. Further, outstanding Foreign Curreny Loan of '' 1,623 crore availed by RITL and '' 1,341 crore availed by RTL is guaranteed by the Company.

During the earlier year, lenders have invoked guarantees provided by borrower group for outstanding rupee loan of '' 5,950 crore availed by the Company, '' 611 crore availed by RTL and '' 485 crore availed by RITL

During the earlier year, the Company created first ranking exclusive charge (pari passu inter se the Lenders) over Designated Account with future rights, title and interest therein, including all of its rights in respect of any amount standing to the credit of the Designated Account and the debt represented by it, in favour of State Bank of India, the Convenor (for the benefit of the Lenders) as continuing security.

During the earlier year, the Company was, in the process of finalising and implementing its asset monetization and debt resolution plan, comprising the Company''s restructuring of Debt including allotment of shares against debt from lenders.

"Foreign currency Loans have been stated at the exchange rate of March 31, 2018."

The Company has not taken any loan during the year.

* RITL has ceased to be a subsidiary of the Company w.e.f. December 22, 2022 upon implementation of the approved resolution plan.

2.19.3 Since the Company is under CIRP and claims have been filed by lenders, the overall obligations and liabilities including obligation for interest on loans shall be determined during the CIR Process. The total loan amount has been disclosed in delay/ default during the current year. However, corresponding amounts of the previous year''s delay/ default are based on original terms of facility and from the date of recall, where loans have been recalled.

2.19.4 Apart from above outstanding of Interest, the Company has not provided Interest Expenses of '' 4,456 crore, '' 4,491 crore, '' 3,916 crore, '' 4,212 crore, '' 3,907 crore and '' 3,055 crore for the year ended March 31, 2023, March 31, 2022, March 31, 2021, March 31, 2020, March 31, 2019 and March 31,2018 respectively which includes interest on NCDs from LIC of '' 421 crore, '' 420 crore, '' 420 crore, '' 420 crore, '' 420 crore and '' 418 crore for the year ended March 31,2023, March 31,2022, March 31, 2021, March 31, 2020, March 31, 2019 and March 31, 2018 respectively. Therefore it has not been disclosed.

2.19.5 The Company had been sanctioned working capital limits from banks in earlier years on the basis of security of current assets. As there was no requirement to file quarterly returns, the Company has not filed the same with such banks.

Revenue for the period from sale of services as disclosed above pertains to revenue from contracts with customers over a period of time. The Company has not given any volume discounts, service level credits, etc during the year. There is no disaggregation of Revenue as it pertains to service revenue of India Operations.

The Company has applied the practical expedient in Ind AS 115. Accordingly, the Company has not disclosed the aggregate transaction price allocated to pending performance obligations which are subject to variability due to several factors such as terminations, changes in scope of contracts, periodic revalidations of the estimates, economic factors (changes in currency rates, tax laws etc). No consideration from contracts with customers is excluded from the amount mentioned above.

The Company classifies the right to consideration in exchange for deliverables as either a receivable or as unbilled revenue if revenues is accrued. Receivable and unbilled revenue are a right to consideration that is unconditional upon passage of time. Receivable is presented net of impairment in the Balance Sheet. Unbilled revenue as at April 1, 2022, was '' 13 crore and it was billed during the year. Unbilled Revenue as at March 31, 2023 is '' 13 crore.

Invoicing in excess of earnings are classified as unearned revenue. Unearned revenue as at April 1, 2022, was '' 136 crore and out of which '' 22 crore was recorded as revenue during the year. Unearned Revenue as at March 31, 2023 is '' 122 crore and out of which '' 40 crore, '' 28 crore and '' 54 crore shall be accounted as revenue within one year, between next two to five years and balance after five years respectively.

Going Concern

1. Pursuant to an application filed by Ericsson India Pvt. Ltd before the National Company Law Tribunal, Mumbai Bench ("NCLT") in terms of Section 9 of the Insolvency and Bankruptcy Code, 2016 read with the rules and regulations framed thereunder ("Code"), the NCLT had admitted the application and ordered the commencement of corporate insolvency resolution process ("CIRP") of Reliance Communications Limited ("Corporate Debtor", "the Company") vide its order dated May 15, 2018. The NCLT had appointed Mr. Pardeep Kumar Sethi as the interim resolution professional ("IRP") for the Corporate Debtor vide its order dated May 18, 2018. The Hon''ble National Company Law Appellate Tribunal ("NCLAT") by an order dated May 30, 2018 had stayed the order passed by the Hon''ble NCLT for initiating the CIRP of the Corporate Debtor and allowed the management of the Corporate Debtor to function. In accordance with the order of the Hon''ble NCLAT, Mr. Pardeep Kumar Sethi handed over the control and management of the Corporate Debtor back to the erstwhile management of the Corporate Debtor on May 30, 2018. Subsequently, by order dated April 30, 201 9, the Hon''ble NCLAT allowed stay on CIRP to be vacated. On the basis of the orders of the Hon''ble NCLAT, Mr. Pardeep Kumar Sethi, wrote to the management of the Corporate Debtor on May 02, 2019 requesting the charge, operations and management of the Corporate Debtor to be handed over back to IRP. Therefore, Mr. Pardeep Kumar Sethi had in his capacity as IRP taken control and custody of the management and operations of the Corporate Debtor from May 02, 2019. Subsequently, the committee of creditors ("CoC") of the Corporate Debtor pursuant to its meeting held on May 30, 201 9 resolved, with requisite voting share, to replace the existing interim resolution professional, i.e. Mr. Pardeep Kumar Sethi with Mr. Anish Niranjan Nanavaty as the resolution professional for the Corporate Debtor in accordance with Section 22(2) of the Code. Subsequently, upon application by the CoC in terms of Section 22(3) of the Code, the NCLT appointed Mr. Anish Niranjan Nanavaty as the resolution professional for the Corporate Debtor ("RP") vide its order dated June 21, 2019, which was published on June 28, 2019 on the website of the NCLT. Accordingly, the IRP handed over the matters pertaining to the affairs of the Corporate Debtor to the RP as on June 28, 2019 who assumed the powers of the board of directors of the Corporate Debtor and the responsibility of conducting the CIRP of the Corporate Debtor.

Further, pursuant to the meeting of the CoC of the Corporate Debtor dated March 2, 2020, a resolution plan, submitted by a resolution applicant in respect of the Corporate Debtor, has been approved by the committee of creditors. The application under Section 31 of the Code filed by the RP for approval of resolution plan is currently pending adjudication before the NCLT.

During the quarter ended June 30, 2019, the CIRP in respect of the Corporate Debtor and its subsidiaries; RTL and RITL had been re-commenced, and interim resolution professionals had been appointed in respect of the aforesaid companies. Subsequently, appointment of Mr. Anish Niranjan Nanavaty as the Resolution Professional (RP) of the Corporate Debtor and its subsidiaries was confirmed by the NCLT vide its order dated June 21, 2019 which was published on June 28, 2019 on the NCLT''s website.

Further, during the year ended March 31, 2020, RCIL, a wholly owned subsidiary of the Corporate Debtor, had also been admitted by NCLT for resolution process under the Code and Mr. Anish Niranjan Nanavaty was appointed as the Resolution Professional of RCIL vide its order dated September 25, 201 9. In the meeting held on August 05, 2021, the CoC with requisite majority approved the resolution plan submitted by Reliance Projects & Property Management Services Limited, and in accordance with the Sec 30(6) of the Insolvency and Bankruptcy Code, 2016, on August 31, 2021, the plan was submitted to Hon''ble NCLT for its due consideration and approval. The matter is currently sub-judice.

In the meantime, the NCLT, Mumbai Bench, vide order dated December 3, 2020, approved the resolution plan submitted by Reliance Projects and Property Management Services Limited ("RPPMSL"), in respect of RITL, a step-down subsidiary of the Corporate Debtor. Upon approval of the resolution plan of RITL, Mr. Anish Niranjan Nanavaty ceased to be the resolution professional of RITL, and RITL was placed under the supervision of a monitoring committee constituted under the provisions of the approved resolution plan comprising of two nominees/representatives of approving financial creditors, two nominees of the Resolution Applicant (RA) and Mr. Anish Niranjan Nanavaty (as the Insolvency Professional). An application bearing number 1 960 of 2019 had been filed by Doha Bank and other banks before the NCLT, Mumbai Bench challenging the constitution of the CoC of RITL basis certain corporate guarantees issued by RITL in respect of facilities availed by the Corporate Debtor, allegedly without consent of the applicant lenders. The NCLT vide order dated March 2, 2021 has partly allowed the appeal and directed "R2 to R7 are not recognised as Financial Creditors of the Corporate Debtor. R1 (RP) is directed to re-constitute the CoC..." An appeal was filed by certain lenders against the order of the NCLT before NCLAT in State Bank of India v. Doha Bank Q.P.S.C. & Ors, Company Appeal (AT)(Ins) No. 304 of 2021. On April 12, 2021, the NCLAT stayed the operation of the impugned order until next date. The Hon''ble NCLAT has vide its order dated October 14, 2022 dismissed the said appeal, and upheld the order passed by the NCLT, inter alia, stating as follows:

"17.For all the afore noted reasons, this Appeal fails and is accordingly dismissed. No Order as to costs."

Certain creditors (who are parties to IA No.1960 of 2019) filed an appeal bearing Civil Appeal No. 8527/2022 before the Hon''ble Supreme Court assailing the order dated October 14, 2022 ("SBI SC Appeal"). The SBI SC Appeal was listed last on November 30, 2022, where the Hon''ble Supreme Court was pleased to issue notice in the SBI SC Appeal. The matter was thereafter listed on March 27, 2023. During the hearing on March 27, 2023, the Bench expressed that the issue involved in the matter requires detailed consideration and accordingly, directed re-listing of the matter for final hearing and disposal on a non-miscellaneous day in the month of August 2023.

An application had also been filed by Doha Bank before the NCLT, Mumbai Bench bearing number IA 3055 of 2019 challenging the decision of the RP of RITL of admission of claims of certain indirect lenders in the CIRP of RITL, on the basis of a deed of hypothecation. The NCLT had, vide order dated March 2, 2021, dismissed the application. An appeal was filed by Doha Bank against the order of the NCLT before the NCLAT in Doha Bank and Ors. v. Anish Nanavaty & Ors., Company Appeal (AT) (Insolvency) No. 414 of 2021. On June 22, 2021, the NCLAT granted stay on distribution of proceeds under the plan among financial creditors as interim relief. The NCLAT vide its order dated September 9, 2022 set aside the order passed by the NCLT and derecognized the creditors of RITL whose claims were admitted basis the deed of hypothecation ("Derecognized DoH Creditors"), as financial creditors. Further, the NCLAT remanded the matter back to the NCLT to take all actions consequential to such derecognition. The relevant portion of the order passed by the Hon''ble NCLAT is as below:

"12. In view of the above stated position of law and fact we are not in a position to sustain the order of the Adjudicating Authority and we are constrained to set aside the impugned order of the Adjudicating Authority and remanding back to the Adjudicating Authority for taking all consequential actions resulting from de-recognizing R-2 to R-5 as ''Financial Creditors''. No order as to costs."

Pursuant to strategic transformation programme, as a part of asset monetization and resolution plan of the Corporate Debtor, the Corporate Debtor and its subsidiary companies; RTL and RITL, with the permission of and on the basis of suggestions of the lenders, had entered into definitive binding agreements with Reliance Jio Infocomm Limited (RJio) for monetization of certain specified assets on December 28, 2017 for sale of Wireless Spectrum, Towers, Fibre and Media Convergence Nodes (MCNs) (as described above, RITL''s implementation of resolution plan has been completed and RITL has ceased to be a subsidiary w.e.f. December 22, 2022). During an earlier year, the said asset sale agreements were terminated by mutual consent on account of various factors and developments including inter alia non receipt of consents from lenders and permission/ approvals from Department of Telecommunication (DoT).

On completion of the corporate insolvency resolution process, the Corporate Debtor will carry out a comprehensive review of all the assets including investments, balances lying in Goods and Service Tax, liabilities and accordingly provide for impairment of assets and write back of liabilities, if any.

The Corporate Debtor had filed applications with the DoT for migration of various telecom licenses [Universal Access Service License (UASL), National Long Distance (NLD) and International Long Distance (ILD) licenses] to the Unified License regime (UL) on October 25, 2020 (17 of which were supposed to expire on July 19, 2021). On June 1 5, 2021, the DoT has issued a letter to the Corporate Debtor requiring payments of various categories of certain amounts such as 10% of the AGR dues, deferred spectrum installments falling due within the CIRP period, etc. against the telecom licenses, stating such dues to be in the nature of "current dues" and prescribing such payment as a pre-condition to the consideration/processing of the migration applications ("DoT Letter"). On June 25, 2021, the Corporate Debtor has issued a letter to DoT clarifying that the various categories of dues stipulated by the DoT are not in the nature of the "current dues" and are to be resolved within the framework of the Code (being dues that pertain to the period prior to May 7, 2019) and/ or are not payable at present, and requesting that making payments against the said dues should not be mandated as a pre-condition for further processing of the migration applications filed by the Corporate Debtor.

In light of the urgency of the matter, the RP had filed an application before the NCLT praying that the DoT inter alia be restrained from taking any action which may interfere with the continued holding of the telecom spectrum of the Corporate Debtor. The NCLT had adjourned the matter following which the RP had thereafter filed a writ petition in the Delhi High Court seeking issuance of an appropriate writ, order or direction in the nature of mandamus directing the DoT to migrate the telecom licenses to UL without the insistence on the payment of the dues set out in DoT Letter. The High Court, on July 19, 2021, passed an interim order that "till the next date, the respondent is directed to not take any coercive action against the petitioner for withdrawal of the telecom spectrum granted to the petitioner in respect of 18 service areas, as also to permit the petitioner to continue providing telecom services in the 18 service areas which are subject matters of the present petition. "On July 20, 2021, the writ petition hearing concluded and order was passed by the High Court permitting the withdrawal of the writ petition with direction that the issue on "current dues" should be decided by the NCLT and extending the protection under the July 1 9, 2021 order by further 10 days.

In view of the aforesaid, the NCLT was apprised of the order of the High Court and the NCLT has, as an interim measure, extended the ad interim protection granted by the Delhi High Court until next date of hearing. Further, on August 12, 2021, the NCLT has directed that the interim orders shall continue until the next date of hearing. The issue under consideration by the NCLT relates to whether the dues being claimed by DoT in its letter of June 15, 2021 for the purposes of processing the license renewal/ migration applications of the Corporate Debtor are in the nature of "current dues" (within the meaning of the Explanation to Section 14(1) of the Code) and therefore, payable during the CIRP period. The matter before NCLT is next listed on June 28, 2023.

Simultaneously, a petition has been filed before the TDSAT seeking directions for migration of the telecom licenses, in view of the Guidelines for Grant of Unified License dated March 28, 201 6 issued by the DoT, not prescribing pre-condition for any payment to be made prior to the migration of the telecom licenses. The TDSAT, on September 23, 2021, has directed that "The interim arrangement shall be considered further after receipt of the order of NCLT. However, till then let the status quo be maintained in terms of initial order of Delhi High Court passed on 19.7.2021 which has continued thereafter by further order of the High Court followed by orders of NCLT." On March 1 5, 2022, the TDSAT granted time for filing rejoinder and continued the interim order dated September 23, 2021. The matter was last listed on April 28, 2023 and is next listed on August 28, 2023.

Similarly, in the case of RTL, in one of the circles where the UASL license was due to expire on September 26, 2021, an application had been filed with DoT on July 16, 2021 for migration of UASL to UL wherein the DoT has sought for payment of certain dues as "current dues" (being dues that pertain to the period prior to May 7, 2019 and are not payable at present) as a pre-condition for consideration of the application. The RP has filed an application in the NCLT and a petition before the TDSAT in this regard (which matters are heard together with the RCOM license migration matters). On September 23, 2021, the TDSAT has directed that "Since the matters are similar in nature, in the interest of justice and uniformity the interim order of status quo as operating in TP No. 31 of 2021 shall operate in this matter also till the next date. It will be in the interest of petitioner to expedite the proceeding pending before the NCLT and try its best to produce the orders passed by that Tribunal by the next date." On March 1 5, 2022, the DOT has been granted 6 weeks'' time by TDSAT to file the reply, rejoinder is to be filed before the next date of hearing. The TDSAT further directed that the interim order passed by the TDSAT vide order dated September 23, 2021 shall stand continuing to be operative during the pendency of the petitions. The matter was last listed on April 28, 2023 and is next listed on August 28, 2023.

Considering these developments including, in particular, the RP having taken over the management and control of the Corporate Debtor and its two subsidiaries, i.e. RTL and RCIL (Group) ( as described above, with the completion of implementation of the resolution plan approved in relation to RITL, RITL is no longer a subsidiary of the Corporate Debtor) inter alia with the objective of running them as going concerns, the standalone financial statements continue to be prepared on going concern basis. Since the Company continues to incur loss, current liabilities exceed current assets and company has defaulted in repayment of borrowings, payment of regulatory and statutory dues and pending renewal of telecom licenses, these events indicate that material uncertainty exists that may cast significant doubt on Company''s ability to continue as a going concern.

Note: 2.32

During the year, the Company received a notice from Axis Trustee Services Limited ("Axis Trustee" / "Security Trustee") on November 9, 2022 regarding invocation cum sale of pledged shares Globalcom IDC Limited ("GIDC"). Thereafter, the Company received a notice of invocation of pledge over such shares from Axis Trustee on December 14, 2022.

As a matter of background, it may be noted that RWSL is a wholly owned subsidiary of RCOM, holding 100% of equity shares in GIDC. Accordingly, GIDC was a wholly owned step-down subsidiary of RCOM. Vide facilities agreement dated August 29, 201 6, RCOM and RITL had availed a loan facility of '' 565 Crore and '' 635 Crore respectively from State Bank of India ("Lender"). Vide share pledge agreement dated September 23, 201 6, RWSL had pledged 100% of its shareholding in GIDC comprising 20,99,994 equity shares to Axis Trustee (in its capacity as a security trustee for the Lender) for above loan facility.

Owing to defaults in the repayment of the facilities availed by RCOM and RITL, Axis Trustee first proceeded to issue a notice for the invocation cum sale of pledged shares on November 9, 2022, and thereafter, invoked the pledge on December 12, 2022.

Schemes of Amalgamation and Arrangement of earlier years

1. Pertaining to earlier years,

The Company, during the earlier years, underwent various restructuring Schemes through Court including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1 956 approved by the Hon''ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Notes to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) '' 8,047 crore being Securities Premium Account, which was part of the Securities Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of '' 5,538 (previous year '' 5,538 crore) representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve III comprises of '' 4,159 crore transferred to General Reserve from Statement of Profit and Loss.

(iv) Additional depreciation of '' Nil (Previous year '' Nil) arising on fair value of the assets has been adjusted, consistent with the practice followed in earlier years, to General Reserve as permitted pursuant to the Scheme of Arrangement sanctioned vide an order dated July 3, 2009 by the Hon''ble High Court and as determined by the Board of Directors.

2. During the earlier year, Pursuant to the Scheme of Demerger ("the Scheme") sanctioned by the Hon''ble High Court of Judicature at Bombay and at Jaipur, the Company had acquired Wireless undertaking of Sistema Shyam Teleservices Limited (SSTL) with effect from October 31, 2017. Upon merger of Wireless undertaking of SSTL, '' 1,397 crore being excess of assets over liabilities taken over has been credited to Capital Reserve. The Company had also allotted 27,65,53,305 nos of Equity Shares of '' 5 each, on October 31, 2017, to Shareholders of SSTL.

(v) Spectrum Charges

Department of Telecommunication (DoT) had, during the earlier years, issued demand on the Company for '' 1,758 Crore towards levy of One Time Spectrum Charges, being the prospective charges for holding CDMA spectrum beyond 2.5 MHz for the period from 1^st January, 2013 till the expiry of the initial terms of the respective Licenses. Based on a Petition filed by the Company (T.P. No. 219 of 2018), the Hon''ble TDSAT, vide its order dated 4^th February 2019, set aside the impugned orders and demands for OTSC. The said TDSAT order dated 4^th February 2019 has been subsequently stayed by Hon''ble Supreme court vide its order passed on 19^th August 2019 in CA No. 6548-6549 of 2019. Currently the matter is subjudice before Hon''ble Supreme court.

* Includes '' 0.41 crore in respect of a particular case based on the original disputed amount for which the case was filed by the complainant. The Company has not disclosed / recognized the revised contingent liability of '' 59.75 crore basis an amended suit served on the Company, which amendment was allowed vide the order of Ld. Court dated 19 April 2022 during the moratorium period which cannot be entertained or allowed, on account of the moratorium under Section 14 of the Code. Note: 2.37

2.37.1 Financial Instruments

The fair value of financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between the willing parties, other than in a forced or liquidation sale.

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

Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, short term loans from banks and other financial institutions approximate their carrying amounts largely due to the short term maturities of these instruments.

Financial Instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rate and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for the expected losses of these receivables.

Fair value hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

2.37.2 Financial Risk Management Objectives and Policies

Activities of the Company expose it to a variety of financial risks: market risk, credit risk and liquidity risk.

The Company''s financial liabilities comprise of borrowings, trade payable and other liabilities to manage its operation and the financial assets include trade receivables, deposits, cash and bank balances, other receivables etc. arising from its operation.

Corporate Insolvency Resolution Process ("CIR Process") had been initiated in case of the Company and four of its subsidiaries [RITL''s implementation of resolution plan has been completed and RITL has ceased to be a subsidiary of the Company w.e.f 22^nd December, 2022 (Refer Note 2.39 (a))] under the Provisions of the Insolvency and Bankruptcy Code, 2016 (the Code) and in case of one subsidiary, NCLT has ordered for initiation of liquidation proceedings (Refer Note 2.39 (c)). Pursuant to the order, the management of affairs of the Company and powers of board of directors of the Company and its two subsidiaries stand vested with the Resolution Professional ("RP") appointed by the NCLT. The framework and the strategies for effective management will be established post implementation of Resolution Plan. Presently, the financial management activities are restricted to management of current assets and liabilities of the Group and the day to day cash flow and its associated risks are as under:

Market risk

The Company also operates internationally and hence, a portion of the business is transacted in several currencies. Consequently, the Company is exposed to foreign exchange risk to the extent that there is mismatch between the currencies in which its sales and services, purchases from overseas suppliers and borrowings in various foreign currencies. Market Risk is the risk that changes in market prices such as foreign exchange rates, interest rates will affect income or value of its holding financial assets/ instruments. The exchange rate between rupee and foreign currencies has changed substantially in recent years and may fluctuate significantly in the future.

As a result operations of the Company are adversely affected as rupee appreciates/ depreciates against US Dollar. Since the Company is under CIR Process, it is not required to meet any loan or interest obligation till the resolution plan is implemented. As the overall obligation and liabilities shall be determined during CIR Process, foreign currency loans are stated at exchange rate as at March 31, 2018.

Sensitivity Analysis

Not relevant till the time resolution plan is finalised.

Interest Rate Risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates, in cases where the borrowings are measured at fair value through profit or loss. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates. Since the Company is under CIR Process, it could not meet interest obligation during the year and shall be finalised when resolution plan is implemented.

Exposure to interest rate risk/ Sensitivity Analysis

Not relavant till the time resolution plan is finalised.

Derivative financial instruments

The Company does not hold derivative financial instruments

The Company offsets a financial asset and a financial liability when it currently has a legally enforceable right to set off the recognized amounts and the company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Credit risk

Credit risk refers to the risk of default on its obligation by the customer/ counter party resulting in a financial loss. The maximum exposure to the credit risk at the reporting date is carrying value of respective financial assets.

Trade receivables and unbilled revenue are typically unsecured and are derived from revenue earned from the customers. Credit risk has always been managed by each business segment through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss (ECL) model to assess the impairment loss or gain. ECL methodology depends on whether there is any significant increase in credit risk. In case of significant increase in credit risk, life time ECL is used; otherwise twelve month ECL is used. The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables and unbilled revenues. The provision matrix takes into account available external and internal credit risk factors such as default risk of industry, credit default swap quotes, credit ratings from international credit rating agencies and historical experience for the customers.

Credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks and financial institutions with high credit ratings assigned by international and/or domestic credit rating agencies. Investments primarily include investment in quoted bonds issued by Government and certificates of deposit which are funds deposited at a bank for a specified time period.

Liquidity risk

The Company is under CIR Process. The Company depends upon timely receipt from sales and delay in sales realisation as well as vendor payments can severely impact the current level of operation. Liquidity crises had led to default in repayment of principal and interest to lenders. Since the Company is under CIR Process, it is not required to meet any loan or interest obligation till the resolution plan is implemented.

Liquidity risk is the financial risk that is encountered due to uncertainty resulting in difficulty in meeting its obligations. An entity is exposed to liquidity risk if markets on which it depends are subject to loss of liquidity for any reason; extraneous or intrinsic to its business operations, affecting its credit rating or unexpected cash outflows. A position can be hedged against market risk but still entail liquidity risk. Prudence requires liquidity risk to be managed in addition to market, credit and other risks as it has tendency to compound other risks. It entails management of asset, liabilities focused on a medium to long-term perspective and future net cash flows on a day-by-day basis in order to assess liquidity risk.

Liquidity Periodic budget and rolling forecasts shall be determined during CIR process.

Exceptional Items Relating to Discontinued Operations

(a) Basis the directions issued by the NCLAT, the erstwhile resolution professional of RITL had preferred an application bearing number IA 2820 of 2022 before the NCLT seeking directions for taking consequential actions pursuant to the order dated 9 September 2022.

Meanwhile, the Derecognized DoH Creditors have filed various appeals (including Civil Appeal No. 7407 of 2022, Civil Appeal No. 7298 of 2022, Civil Appeal No. 7615, and Civil Appeal No. 7328) against the order passed by the NCLAT before the Hon''ble Supreme Court of India ("Secured Creditors Appeals"). The Hon''ble Supreme Court of India has vide its order dated October 21, 2022 issued notice in such appeals (barring the appeal filed by Industrial and Commercial Bank of China which was taken up later by the Bench on December 14, 2022 owing to pending rectification of defects). Vide the order dated October 21, 2022, the Hon''ble Supreme Court has stayed the operation of the order passed by the NCLAT. The relevant portion for the order passed by the Hon''ble Supreme Court of India states as follows:

Issue notice. Until further orders, there shall be stay of the operation of the impugned Order(s).

Further, when the Hon''ble Supreme Court of India took up the appeal filed by Industrial and Commercial Bank of China on December 14, 2022, it was pleased to tag all the Secured Creditors Appeals together, and such appeals are now next listed in 18^th July 2023 (tentatively).

Considering the pendency of inter-creditor disputes highlighted above, Reliance Projects and Property Management Services Limited had preferred an application before the NCLT, bearing I.A No. 3429 of 2022 seeking necessary directions to allow the implementation of the resolution plan approved in respect of RITL, by way of deposit of the plan amount in an escrow account, with the inter se distribution of the amounts among financial creditors being subject to the final outcome of the aforesaid legal proceedings concerning the status of financial creditors. The financial creditors of RITL did not have any objection to the aforesaid, provided that the distribution of these amounts amongst the financial creditors will be subject to the outcome of the SBI SC Appeal and Secured Creditors Civil Appeal (collectively referred to as the "Pending SC Appeals"). The Hon''ble NCLT vide order dated November 21, 2022 ("Nov 21 Order") permitted the Resolution Applicant to proceed with implementation of the resolution plan and depositing the total value of the resolution plan, in an escrow account to be opened with State Bank of India. The relevant excerpts of the Nov 21 Order are set out below:

Accordingly, this Bench is of the view that an Escrow Account should be permitted to be opened in the State Bank of India, and the total value of the Resolution Plan should be deposited in that account. Further, the distribution of the amount so deposited in the Escrow account shall be in terms of the order passed by the Hon''ble Apex Court and after obtaining permission/orders from this Bench.

This position was also reiterated by the Hon''ble Supreme Court in its order dated November 30, 2022, when the SBI SC Appeals were listed before it and it inter alia directed that the amounts payable in terms of the resolution plan be deposited in an escrow account to be opened with State Bank of India (i.e., the account bank herein) in terms of the Nov 21 Order with no distributions from the said account till the next date of hearing. The relevant excerpts in relation to the order dated November 30, 2022, are set out below:

In the meanwhile, we direct that the proponent will deposit the amount/money payable in an escrow account to be opened in the State Bank of India in terms of the order dated 21.1 1.2022 passed by the National Company Law Appellate Tribunal Court-I, Mumbai Bench, Maharashtra.

Pursuant to the above, RPPMSL issued a closing action notice dated December 21, 2022 committing to implement the resolution plan on or before December 23, 2022.

Accordingly, in pursuance of the above and in compliance with the Nov 21 Order, the Escrow Agreement dated December 22, 2022 ("Escrow Agreement") has been executed between RITL, representative of financial creditors State Bank of India and China Development Bank, RPPMSL, Mr. Anish Nanavaty (as authorised signatory) and State Bank of India (as account bank) for purposes of recording the terms governing the escrow account set up in accordance with the Nov 21 Order.

RPPMSL has transferred an amount of INR 3,720 Crore (Rupees Three Thousand Seven Hundred and Twenty Crores Only) in the escrow account(s) opened in pursuance of the Escrow Agreement, in lieu of which 372,00,00,000 Zero Coupon Optionally Fully Convertible Debentures ("OFCD") have been allotted to RPPMSL. Further, as part of the implementation, RPPMSL has infused an amount of INR 5 Crore (Rupees Five Crores Only) in the share subscription account of the Company with State Bank of India, in lieu of which, 50,00,000 (Fifty Lakhs) equity shares of RITL have been allotted to RPPMSL (along with its nominees).

Simultaneously, the entire existing issued, subscribed and paid-up share capital of the Company, being (a) 2,79,31,41,868 equity shares of INR 10 each, aggregating to INR 27.93 Crore; and (b) 4,00,00,000 0.1% Redeemable, Non-Cumulative, Non-Convertible preference shares of INR 10 each, aggregating to INR 40 Crore (except the paid-up equity share capital to the extent of the upfront equity infusion amounting to INR 5 Crore (Rupees Five Crore Only) allotted to RPPMSL (along with its nominees) in terms of the resolution plan), has been cancelled/reduced.

The amounts deposited in the escrow account(s) in pursuance of the Escrow Agreement shall be distributed to the relevant creditors and other stakeholders basis further directions from the relevant judicial authorities.

With the completion of the aforesaid actions, the resolution plan for RITL stands implemented on December 22, 2022 in terms of the order of the NCLT dated December 03, 2020 read together with the order dated November 21, 2022 and the Monitoring Committee of RITL has stood dissolved and RPPMSL has acquired the ownership and control of RITL in terms of the approved resolution plan.

Accordingly, RITL has ceased to be a subsidiary of the Company with effect from December 22, 2022. During the year ended March 31, 2023, Loss on de-subsidiarisation is '' 4,208 Crore and is shown as Exceptional Items.

(b) The Hon''ble Supreme Court of India, vide its order dated October 24, 2019 had dismissed the petition filed by the telecom operators and agreed with the interpretation of the Department of Telecommunications (DoT) to the definition of Adjusted Gross Revenue (AGR) under the license.

On September 01, 2020, the Supreme Court pronounced the judgment in the AGR matter ("SC Judgement"). It has framed various questions in respect of companies under insolvency and in respect of such questions, the Court has held that the same should be decided first by the NCLT by a reasoned order within 2 months, and that it has not gone into the merits in this decision.

The RP of the Corporate Debtor and RTL had filed intervention applications before the NCLAT in the appeal filed by the Department of Telecommunications against the resolution plan approval orders of the Aircel companies (wherein the NCLAT was adjudicating on the questions framed by the Hon''ble Supreme Court in the SC Judgement). The RP had also filed written legal submissions in this regard with the NCLAT. The Hon''ble NCLAT has pronounced its judgement dated April 1 3, 2021 setting out its findings on the questions framed in the SC Judgment. The RP has filed appeals in respect of the Corporate Debtor and RTL against the judgement of the NCLAT before the Supreme Court. On August 2, 2021, the appeals were listed when the bench issued notice in the matter and tagged the same with Civil Appeal No 1810 of 2021 (being the appeal filed by the COC of Aircel companies) and also allowed the application seeking permission to file the civil appeal. On February 22, 2022, the Supreme Court granted a period of six weeks to the DoT to file counter affidavit. The matter was listed on May 2, 2022 wherein the SC directed the matter to be tentatively listed in the third week of July 2022. The matter was mentioned on August 5, 2022, for early listing for arguments, but the Supreme Court directed the matter to be listed after eight weeks. The matter was thereafter listed on October 1 1, 2022, on which date, the Supreme Court directed that the matter be listed after six weeks. Further, the Supreme Court stated that the parties were to file a common compilation post discussion with each other, and file brief written submissions within a period of six weeks. Next date of hearing in the matter is July 18, 2023 (tentative).

The appeals are currently sub judice.

Further, in the SC Judgement, reiterating that AGR dues as per original decision should be paid, the Hon''ble Supreme Court had directed that DoT should complete the assessment in cases where demand had not been raised and raise demand if it has not been raised, to examine the correctness of self-assessment and raise demand, if necessary, after due verification. In case demand notice has not been issued, DoT should raise the demand within six weeks from date of judgement. The Corporate Debtor has not received any such demand in this regard till date.

The DoT had during the pendency of the various proceedings simultaneously directed Special Audit in relation to the computation of License fee, Spectrum fee, applicable interest and penalties thereon, which is under progress for the financial year 2015-16 onwards. In this regard, the Corporate Debtor had provided for estimated liability aggregating to '' 36,956 crore up to the previous year ended March 31, 2022 and has provided additional charge of '' 5,647 crore during the year ended March 31, 2023 and shown as exceptional items relating to discontinued operations which may undergo revision based on demands from DoT and/ or any developments in this matter.

Considering various factors including admission of the Corporate Debtor and its subsidiary RTL to resolution process under the Code and the moratorium applicable under Code, discharge of the aforesaid liability will be dealt with in accordance with the Code (subject to orders in the relevant judicial proceedings).

(c) During earlier year ended March 31, 2021, Reliance Tech Services Limited (''RTSL''), a wholly owned subsidiary of the Corporate Debtor, had been admitted by NCLT on August 04, 2020 for corporate insolvency resolution process under the Code and Mr. Anjan Bhattacharya had been appointed as the Interim Resolution Professional (IRP) and subsequently as the Resolution Professional (RP) by the Hon''ble NCLT. During the previous year, the resolution professional of RTSL had filed an application with NCLT on May 04, 2021 for initiation of liquidation proceedings in respect of RTSL.

During the year, NCLT vide order dated March 03, 2023 has ordered the liquidation of RTSL and appointed Mr. Ashok Mittal as Liquidator. Further, since there are no fixed assets, ongoing operations, or any employees in RTSL, therefore RTSL may not be capable of being liquidated as a going concern in terms of the Code, and accordingly, during the year ended March 31, 2023, provision is made on Investment of '' 0.05 Crore is represented as Exceptional Items.

(d) Assets held for sale including Wireless Spectrum, Towers, Fibre and Media Convergence Nodes (MCNs) continue to be classified as held for sale at the value ascertained at the end of March 31, 2018, along with liabilities and disclosed separately as discontinued operations in line with Ind AS 105 "Non-current Assets Held for Sale and Discontinued Operations.

Note:2.40

Recovery of the Expenses

Expenses are net of recoveries for common cost from; RITL (ceased w.e.f. December 22, 2022), a subsidiary of RCIL includes '' 5 crore (previous year '' 7) for Network Expenses and '' 3 crore (Previous year '' 3 crore) for Sales and General and Administration Expenses; GIDC (ceased w.e.f. December 12, 2022), a Subsidiary of the Company includes '' 0.49 crore (Previous year '' 2 crore) for Sales and General and Administration Expenses.

Note:2.41

Corporate Social Responsibility

The Company is not required to spend towards Corporate Social Responsibility (CSR) as per Section 135 of the Companies Act, 2013, since there is no average profit in the last 3 years calculated as per the provisions of the Act.

Note 2.42 Employee Benefits

Gratuity: In accordance with the applicable Indian laws, the Company provides for the gratuity, a defined benefit retirement plan (Gratuity Plan) for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employee''s last drawn salary and for the years of employment with the Company.

The gratuity plan is governed by the Payment of Gratuity Act, 1972 (Gratuity Act). The Company is bound to pay the statutory minimum gratuity as prescribed under Gratuity Act. There are no minimum funding requirements for a gratuity plan in India. The Company''s philosophy is to fund the benefits based on its own liquidity and tax position as well as level of underfunding of the plan vis-a-vis settlements. The management is responsible for the overall governance of the plan. The management has outsourced the investment management of the fund to insurance company which in turn manages these funds as per the mandate provided to them by the trustees and applicable insurance and other regulations.

The Company operates its gratuity and superannuation plans through separate trusts which is administered and managed by the Trustees. As on March 31, 2023 and March 31, 2022, the contributions towards superannuation plans have been invested in Insurer Managed Funds.

Mar 31, 2018

1.01.1 Intangible Assets under development includes:

(a) Rs.3 crore (Previous year Rs.1 crore) on account of borrowing cost capitalised

(b) Rs. Nil (Previous year Rs.65 crore) on account of fee for additional spectrum.

1.01.2 During the earlier years, the Company had successfully Bid under auction conducted for spectrum by the Department of Telecommunications (DoT), Government of India (GoI) and won spectrum in 12 service areas as total cost of Rs.1,934 crore. The Company has made upfront payment of Rs.527 under deferred payment option. Balance Rs.1,407 crore being in the nature of long term liability, has been disclosed separetaly as Deferred Payment Liability. Balance Payment of Rs.3,424 crore including interest @10% per annum of Rs.2,017 crore is payable in 16 annual installments starting from FY 2017-18

During the year, the Company acquired Spectrum of Rs.4,513 crore under Scheme of Demerger along with corresponding Deferred Payment Liability of Rs.2,013 crore. (Refer Note No. 2.34.2) Balance payment of Rs.3,940 crore including interest @10% per annum of Rs.1,927 crore is payable in 16 annual installments starting from FY 2017-18

1.01.3 Balance useful life as at March 31, 2018 is 5 years for Indefeasible Right of Connectivity (IRC),

1.01.4 During the year,

(a) Foreign Exchange Variance has been capitalised in Telecom Licenses of Rs. Nil (Previous year Rs.1 3 crore). Depreciation, on exchange variance capitalised, of Rs.5 crore (Previous year Rs.9 crore) has been charged to Statement of Profit and Loss

(b) The Company has capitalised borrowing cost of Nil (Previous year Rs.112 crore) in Telecom Licenses and Intangible Assets under Development Rs.3 crore (Previous year Rs.1 crore).

1.01.5 Refer Note 2.18 and 2.22 for Security in favour of the Lenders.

1.01.6 Above notes to be read with Note 2.15 âAssets Held for Saleâ.

The Company has unabsorbed business losses/depreciation and long term capital losses which according to the management will be used to setoff taxable profit arising, in next few years from, operation and/or sale of asset of the Company.

Significant management judgement has been considered in determining the provision for income tax, deferred tax assets and liabilities and recoverability of deferred tax assets. The recoverability of deferred tax assets is based on estimate of the taxable income for the period over which deferred tax assets will be recovered.

Deferred Tax Assets have not been recognised in respect of long term capital losses as at March 31, 2018 is as under:

The Companyâs weighted average tax rates for the years ended March 31, 2018 and 2017 have been (0.01%) and 53% respectively. The effective tax rate for the year ended March 31, 2018 has been lower primarily as a result of the facts mentioned above.

Note: 1.2

(a) Assets held for Sale

During the year, consequent to discontinuance of wireless business, the following assets have been classified as Assets held for Sale and recorded at lower of carrying amount and fair value less cost to sell. Refer Note 2.01.3 for Security in favour of the Lenders.

(1) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.5 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and Purpose of Reserve Capital Reserve

Debenture Redemption Reserve

Securities Premium Account

Securities Premium represents the premium charged to the shareholders at the time of issuance of shares. It also includes Rs.8,047 crore created pursuant to the Scheme of Amalgamation/ Arrangements of the earlier years. Securities Premium can be utilised based on the relevant requirements of the Act

General Reserve I

General Reserve I of Rs.5,538 crore (Previous year Rs.5,538 crore) represents the unadjusted balance being the excess of assets over liabilities relatable to the Telecommunications Undertaking transferred and vested into the Company.

General Reserve II

General Reserve II of Rs. Nil (Previous year Rs.2,785 crore) representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to the Telecommunications Undertaking transferred and vested into the Company.

General Reserve III

General Reserve III comprises of Rs.4,159 crore transferred to General Reserve from Statement of Profit and Loss and Rs. Nil (Previous year Rs.2,603 crore) arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs. Nil (Previous year Rs.1 crore) of erstwhile Global Innovative Solutions Private Limited.

Reserve for Business Restructuring

Reserve for Business Restructuring of Rs. Nil (Previous year Rs.1,287 crore) represents revaluation of investment in RCIL, the Holding Company of RITL after withdrawing an amount equivalent to writing off passive infrastructure assets transferred to RITL to the Statement of Profit and Loss.

Foreign Currency Monetary Items Translation Difference Account (FCMITDA)

FCMITDA has been created in view of the option allowed pursuant to the notification dated December 29, 201 1 issued by the MCA, GoI, being the exchange differences on long term borrowing other than borrowings relating to acquisition of depreciable capital assets.

Treasury Equity

Treasury Equity represents 2,1 2,79,000 nos. of Equity Shares held by the ESOS Trust.

1.3.1 Debentures, Senior Secured Notes and Term Loans

The Company, on March 2, 2009, allotted, 3,000, 1 1.20% Secured Redeemable, Non Convertible Debentures (âNCDsâ) of the face value of Rs.1,00,00,000 each, aggregating to Rs.3,000 crore to be redeemed at the end of 10th year from the date of allotment thereof. The Company on February 7, 2012, also allotted, 1,500, 1 1.25% Secured Redeemable Non Convertible Debentures (âNCDsâ) of the face value of Rs.1,00,00,000 each aggregating to Rs.1,500 crore redeemable in four annual equal installments starting at the end of 4th year from the date of allotment thereof, the outstanding against said NCDs is Rs.750 crore as on March 31, 2018. The Company had, on May 6, 2015, issued Senior Secured Notes (SCNs) of USD 300 million, face value of USD 100 per bond, bearing 6.5% p.a. interest, with a maturity of 5 1/2 years.

The Company had been sanctioned Rupee Loans of Rs.6,015 crore (outstanding as on March 31,2018 was Rs.5,463 crore) (Term Loan Facility) under consortium banking arrangement on the terms and conditions as set out in common loan agreement.

NCDs along with SCNS, Foreign Currency Loans and Rupee Loans of Rs.24,675 crore (âthe said Secured Loansâ) have been secured by first pari passu charge on the whole of the movable plant and machinery including (without limitations) tower assets and optic fiber cables, if any (whether attached or otherwise), capital work in progress (pertaining to the movable fixed assets), both present and future including all the rights, title, interests, benefits, claims and demands in respect of all insurance contracts relating thereto of the Borrower Group; comprising of the Company and its subsidiary companies namely; RTL, RITL and RCIL, (âthe Borrower Groupâ), in favour of the Security Trustee for the benefit of the NCD/ SCN Holders and the lenders of the said Secured Loans. The said loans also include Rs.3,583 crore, which are guaranteed. Rupee Loans of Rs.487 crore are secured by second pari passu charge on the movable plant and machinery and capital work in progress of the Borrower Group, Tower receivables, pledge of equity shares of RIDC held by RWL and also guaranteed. Further, Rupee loan of Rs.68 crore is secured by Second Charge on Fixed Assets of Borrower Group. The Company, for the benefit of the Lenders of SCN of Rs.1,955 crore, Foreign Currency Loans of Rs.11,191 crore, 11.25% NCDs aggregating to Rs.750 crore and Rupee Loans of Rs.7,403 crore has, apart from the above, also assigned 20 Telecom Licenses for services under Unified Access Services (UAS), National Long Distance (NLD) and International Long Distance (ILD) (collectively referred as âTelecom Licensesâ) by execution of the Tripartite Agreements with DoT and the Security Trustee acting on behalf of the Lenders. Further, assignment of the Telecom Licences of the Company for rupee loans from banks of Rs.1,492 crore and from others of Rs.248 crore is pending to be executed. Apart from above Rupee Loan also includes Rs.398 crore which is secured by Spectrum, acquired during the year under the scheme of demerger, (Refer Note 2.34.2) is pending to be executed.

The Company has, for the benefit of the Lenders of SCNs, Foreign Currency Loans and Rupee Loans aggregating to Rs.19,102 crore, apart from the above security, pledged equity shares of RCIL held by the Company and of RTL held by the Company and Reliance Realty Limited by execution of the Share Pledge Agreement with the Share Pledge Security Trustee. Rupee Loans of Rs.5,463 crore is also secured by pledge of equity shares of RITL held by RCIL, current assets, movable assets including intangible, both present and future of the Borrower Group and Corporate Guarantee of the Borrower Group. Charge over the immovable assets except three immovable assets of the Borrower Group and RGBV security for Rupee Loans of Rs.5,463 crore is pending to be executed.

1.3.2 Pending the finalisation of overall debt resolution plan, long term borrowings which are not recalled for payment is continued to be classified as non current liabilities.

1.3.3 Confirmation in respect of certain borrowings aggregating to Rs.3,583 crore have not been received and the same has been reflected on the basis of information available with the Company.

1.3.4 During the year, there was a delay of 11days in case of installment payment of Rs.22 crore to Department of Telecommunications. Further, as at March 31, 2018, Rs.281 crore was outstanding, delayed by 10 days which was subsequently paid.

1.4.1 Rupee Loans of Rs.750 crore is secured by first pari passu charge on the whole of the movable Plant and Machinery including (without limitations) tower assets and optic fiber cables, if any (whether attached or otherwise), capital work in progress (pertaining to the movable fixed assets), both present and future including all the rights, title, interests, benefits, claims and demands in respect of all insurance contracts relating thereto of the Borrower Group. Rupee Loans of Rs.1,741 crore is secured by second charge over movable Fixed Assets of the Borrower Group. Rupee Loans of Rs.1,072 crore is secured by second charge over Assets of the Borrower Group, is pending to be created.

Note: 1.5 Previous year

The figures of the previous year have been regrouped and reclassified, wherever required. Amount in financial statements are presented in Rupees in crore, except as otherwise stated.

Note: 1.6

Going Concern

The Company was engaged with Joint Lendersâ Forum (ILF), constituted on June 2, 2017 and under standstill period till December 2017 pursuant to the Strategic Debt Restructuring Scheme (SDR Scheme) of Reserve Bank of India (RBI). Consequent to circular of 12th February, 2018 of RBI, the Company continued to work closely with the Lenders to finalise an overall debt resolution plan. Pursuant to strategic transformation programme, as a part of debt resolution plan of the Company under consideration, inter alia of the Lenders, the Company and its subsidiaries; Reliance Telecom Limited (RTL) and Reliance Infratel Limited (RITL), with the permission of and on the basis of suggestions of the Lenders, had for monetization of some specified Assets, entered into definitive binding agreements with Reliance Jio Infocomm Limited (RJio) on December 28, 201 7 for sale of Wireless Spectrum, Towers, Fiber and Media Convergence Nodes (MCNs). Further, the Company has also entered into a definitive binding agreement with Pantel Technologies Private Limited and Veecon Media and Television Limited for sale of its subsidiary company having DTH Business. The Company and its said subsidiaries expected to close these transactions in a phased manner. In the meanwhile, Honâble National Company Law Tribunal (NCLT), Mumbai has, overruling the objections of the Company as also its lenders represented by State Bank of India, the lead member, vide its order dated May 15, 2018 admitted applications filed by an operational creditor for its claims against the Company and its subsidiaries; RTL and RITL and thereby admitted the companies to debt resolution process under the Insolvency and Bankruptcy Code, 2016 (IBC). As a consequence, Interim Resolution Professionals (IRPs) were appointed vide NCLTâs order dated May 18, 2018. The Company along with the support of the lenders filed an appeal with Honâble National Company Law Appellate Tribunal (NCLAT) challenging the order of NCLT admitting the Company to IBC proceedings. The Honâble NCLAT, vide its order dated May 30, 2018, stayed the orders passed by NCLT and consequently, the Board of the respective Companies stand reinstated. Further, Minority Shareholders holding 4.26% stake in RITL had accused the management of RITL of âOppression of minority shareholders and mismanagementâ and filed a petition in NCLT. Based on an amendment to the Petition, the NCLT stayed RITLâs proposed asset sale (Tower and Fibre). The parties have subsequently settled the dispute and the restriction on sale stands vacated. The Company is confident that a suitable debt resolution plan would be formulated along with its lenders as per the strategic transformation programme. Considering these developments, the financial statements continue to be prepared on going concern basis.

Note: 1.7

Foreign Currency Monetary Items; Long Term

In view of the option allowed pursuant to the notification dated December 29, 201 1 issued by the Ministry of Corporate Affairs (MCA),Government of India, for the year ended on March 31, 2018, the Company has acculumated by Rs.37 crore (Previous year reduced Rs.182 crore) of exchange differences on long term borrowings relating to the acquisition of depreciable capital assets to the cost of capitalised assets. Further, the Company has acculumated foreign currency variations of Rs.13 crore (Previous year reduced Rs.77 crore) arising on other long-term foreign currency monetary items in FCMITDA and Rs.252 crore (Previous year Rs.238 crore) has been amortised during the year, leaving balance to be amortised over the balance period of loans.

Note: 1.8

Schemes of Amalgamation and Arrangement

1 . Pertaining to earlier years,

The Company, during the earlier years, underwent various restructuring Schemes through Court including restructuring of ownership of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement (âthe Schemesâ) under Sections 391 to 394 of the Companies Act, 1956 approved by the Honâble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Notes to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs.8,047 crore being Securities Premium Account, which was part of the Securities Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of Rs.5,538 crore (Previous year Rs.5,538 crore) representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs. Nil (Previous year Rs.2,785 crore) representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III comprises of Rs.4,159 crore transferred to General Reserve from Statement of Profit and Loss and Rs. Nil (Previous year Rs.2,603 crore) arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs. Nil (Previous year Rs.1 crore) of erstwhile Global Innovative Solutions Private Limited.

(v) Reserve for Business Restructuring of Rs. Nil (Previous year Rs.1,287 crore) represents revaluation of investment in RCIL, the Holding Company of RITL after withdrawing an amount equivalent to writing off passive infrastructure assets transferred to RITL to the Statement of Profit and Loss.

(vi) Additional depreciation of Rs.280 crore (Previous year Rs.1,205 crore) arising on fair value of the assets has been adjusted, consistent with the practice followed in earlier years, to General Reserve as permitted pursuant to the Scheme of Arrangement sanctioned vide an order dated July 3, 2009 by the Honâble High Court and as determined by the Board of Directors.

(vii) Also refer note 2.41 âExceptional Itemsâ below.

2 Pursuant to the Scheme of Demerger (âthe Schemeâ) sanctioned by the Honâble High Court of Judicature at Bombay and at Jaipur, the Company has acquired Wireless undertaking of Systema Shyam Teleservices Limited (SSTL) with effect from October 31, 2017. Upon merger of Wireless undertaking of SSTL, Rs.1,397 crore being excess of assets over liabilities taken over has been credited to Capital Reserve. The Company has also allotted 27,65,53,305 nos of Equity Shares of Rs.5 each, on October 31, 2017, to Shareholders of SSTL.

Note: 1.9

Capital Management

Capital of the Company, for the purpose of capital management, include issued equity capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Companyâs capital management is to maximise shareholders value.

The funding requirement is met through a mixture of equity, internal accruals, long term borrowings and short term borrowings.

The Company monitors capital using gearing ratio, which is debt divided by total capital plus debt.

Increasing capital gearing ratio reflects reduction in equity on account of net losses incurred during the year and withdrawal of depreciation / amortisation of fair value of assets and loss on account of change in exchange rates from General Reserve as permitted by the Court Scheme.

Provisions include, provision for disputed claims of verification of customers Rs.9 crore (Previous year Rs.9 crore) and others of Rs.1,206 crore (Previous year Rs.1,206 crore). The aforesaid provisions shall be utilised on settlement of the claims, if any, there against.

Note: 1.10

Contingent Liabilities and Capital Commitment (as represented by the Management)

DoT has, during the earlier years, issued demand on the Company for Rs.1,758 crore towards levy of one time Spectrum Charges, being the prospective charges for holding CDMA spectrum beyond 2.5 MHz for the period from January 1, 2013 till the expiry of the initial terms of the respective Licenses. Based on a petition filed by the Company, the Honâble High Court of Kolkata, vide its order dated February 14 and April 19, 2013 has stayed the operation of such impugned demand till further order. The Company is of the view that the said demand, inter alia, is an alteration of financial terms of the licenses issued in the past and has also been advised so legally. Accordingly, no provision in this regard is required.

(vi) License and Spectrum Fee demands on account of Special Audit and Comptroller and Audit General (CAG) Audit

CAG has also conducted audit of the Company for financial years 2006-07 to 2014-15 and they also recommended to add back non telecom revenue in AGR. The Company has challenged all demands raised by DoT on recommendation of Special Auditors and CAG before Honâble TDSAT. Honâble TDSAT vide its judgement dated April 23, 2015 has set aside all License fee related demands and directed DoT to rework the license fees payable by the operators for the past periods, in light of the findings, observations and directions made in the said judgement and to issue fresh demands, which the operators will pay within the time prescribed under the law. DoT has challenged the said Honâble TDSAT judgement in Honâble Supreme Court and has not revised/raised any fresh demand. The matter is pending before Honâble Supreme Court, though Honâble Supreme Court vide its order dated February 29, 201 6 allowed DoT to raise demand as per its understanding but not to enforce the same till the appeals are finally decided by the Honâble Supreme Court. As per the judgement of Honâble TDSAT dated April 23, 201 5 which is operative as on date and other judicial pronouncements directly applicable to the issues of License fee dues raised by DoT on recommendations of Special Auditors and CAG, there shall not be any liability of License fee and hence, no provision is required in the accounts of the Company.

Note: 1.11

Operating Lease

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

Note: 1.12

1.12.1 Financial Instruments

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

Fair value hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

There is no fair valuation of financial instruments.

The carrying values of the financial instruments by categories were as follows:

1.12.2 Financial Risk Management Objectives and Policies

Activities of the Company expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Companyâs primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

The Companyâs financial liabilities comprise of borrowings, trade payable and other liabilities to manage its operation and the financial assets include trade receivables, deposits, cash and bank balances, other receivables etc. arising from its operation.

The Company has constituted a Risk Management Committee consisting of majority of the directors and senior managerial personnel. The Company has a robust Business Risk Management framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance competitive advantage. It defines the risk management approach across the enterprise at various levels including documentation and reporting and contains different risk models, which help in identifying risks trend, exposure and potential impact analysis at the Company level as also separately for the business segments.

The Company has instituted a self governed framework based on identification of potential risk areas, evaluation of risk intensity, and clear- cut risk mitigation policies, plans and procedures, both at the enterprise and operating levels. The framework seeks to facilitate a common organisational understanding of the exposure to various risks and uncertainties at an early stage, followed by timely and effective mitigation. This framework is reviewed at periodic intervals.

Market risk

Sensitivity Analysis

The sensitivity of profit or loss to changes in the exchange rates arises mainly from foreign currency denominated financial instruments as mentioned below.

Interest Rate Risk

Exposure to Interest Rate Risk

Interest rate risk of the Company arises from borrowings. The Company endeavors to adopt a policy of ensuring that maximum of its interest rate risk exposure is at fixed rate. The Companyâs interest-bearing financial instruments are reported as below

Fair value sensitivity analysis for fixed-rate instruments

The Company does not account for any fixed-rate financial assets or financial liabilities at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 100 basis points in interest rates at the reporting date would increase/ (decrease) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

The risk estimates provided assume a parallel shift of 100 basis points interest rate across all yield curves. This calculation also assumes that the change occurs at the balance sheet date and is calculated based on risk exposures outstanding as at that date. The period end balances are not necessarily representative of the average debt outstanding during the period.

Derivative financial instruments

The Company does not hold derivative financial instruments

The Company offsets a financial asset and a financial liability when it currently has a legally enforceable right to set off the recognized amounts and the Company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Credit risk

Credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks and financial institutions with high credit ratings assigned by international and/or domestic credit rating agencies. Investments primarily include investment in liquid mutual fund units, quoted bonds issued by Government and Quasi Government organizations and certificates of deposit which are funds deposited at a bank for a specified time period.

Liquidity risk

The Companyâs principal sources of liquidity are cash and cash equivalents and the cash flow that is generated from operations. Competitive intensity adversely impacted revenue and consequent cash accruals during the year. Consequent to the process of monetisation of the Company led by the Lenders and execution of definitive binding agreements for sale of certain assets, the Company, during the year, exited from consumer business and decided to focus on business portfolio comprising of Business to Business (B2B) businesses namely; Global and Indian enterprise, internet data centres (IDC), global submarine cable network and international long distance voice with Global and Indian customers. This has resulted in restraining drain on liquidity of the continuing operations. However, this, coupled with current level of debt and imminent repayment obligations, has sustained stress on liquidity profile. The Company closely monitors its liquidity position and is attempting to maintain a balance between continuity of funding and flexibility by increasing cash flow generated from its operations and realisations apart from other proposed measures, extended maturity period for repayment of restructured debt.

Current and prospective liquidity risk is encountered when the Company is required to meet its obligations. The Companyâs approach to managing liquidity, that it will have sufficient cash and financial assets to meet its obligations and collateral needs, both expected and unexpected, under normal and stressed conditions, without incurring unacceptable losses. Dynamic nature of the underlying businesses necessitates that the treasury function ensures flexibility in funding by maintaining adequate working capital and its availability under committed credit lines, for uninterrupted business operations. Existing operations of the Company are primarily funded through long term loans and advances. The Company is seeking to maintain/ enhance the level of working capital credit lines, so that operations are performed at optimum level.

Periodic budgets and rolling forecasts are prepared at the level of operating subsidiaries as regular practice and in accordance with limits specified by the Company. 74% of the total debt will be payable in less than one year i.e. during the financial year ended as at March 31, 2019. Apart from this, there is an outstanding principal of Rs.9,395 crore as at the end of the year and interest as applicable thereon payable to the lenders. There is delay/ default in scheduled repayment of the loans for Rs.12,511 crore as at the end of the financial year. The Company has been pursuing proposed strategic transactions/ sale of assets and overall financial restructuring with the existing lenders. Such restructuring, when executed, would make available the required liquidity for the continuing business and would also provide an extended maturity period for repayment of restructured balance debt.

Note: 1.13 Exceptional Items

Pursuant to the direction of the Honâble High Court of Judicature of Mumbai/ Gujarat and option exercised by the Board of the Company, in accordance with and as per the Scheme of Arrangement (âthe Schemeâ) approved by the Honâble High Court vide order dated July 3, 2009 binding on the Company, expenses and/ or losses, identified by the Board of the Company as being exceptional or otherwise subject to the Accounting treatment prescribed in the Schemes and comprising of Rs.221 crore (Previous year Rs.433 crore) of depreciation consequent to addition of exchange differences on long term borrowing relating to capital assets to the cost of capitalised assets, as also Rs.25 crore (gain) (Previous year loss Rs.8 crore) of exchange variation (net) on items other than long term monetary items, Rs.252 crore (Previous year Rs.238 crore) being amortization of FCMITDA excluding the portion added to the cost of fixed assets or carried forward as FCMITDA in accordance with Para 46 A inserted into the then applicable Accounting Standard (AS) 11 âThe Effects of changes in Foreign Exchange Ratesâ in the context of unprecedented volatility in exchange rate during the year have been met by withdrawal from corresponding General Reserves, leaving no impact on loss for the year ended March 31, 2018. Apart from this, Rs.5,948 crore pertaining to Impairment of assets and diminution in the value of Investments have been withdrawn from General Reserve and Reserve for Business Restructuring. Such withdrawals have been included/ reflected in the Statement of Profit and Loss. The Company has been legally advised that such inclusion in the statement of Profit and loss is in accordance with Schedule III of the Companies Act, 2013. Had such write off of expenses, losses and depreciation/ amortisation (Refer Note 2.34.1 (vi)) not met from General Reserve, the Company would have reflected a Loss after tax for the year of Rs.1 6,546 crore (Previous year loss after tax of Rs.3,680 crore).

Note: 1.14

Recovery of Expenses

Expenses are net of recoveries for common cost from; RCIL, a Wholly Owned Subsidiary of the Company, includes Rs. Nil (Previous year Rs.31,72,015) for Salaries, Rs.8,97,690 (Previous year Rs.197 crore) for Finance Cost. RIDC, a Wholly Owned Subsidiary of RWL, includes Rs. Nil (Previous year Rs.168 crore) for Network Expenses, Rs. Nil (Previous year Rs.11 crore) for Finance Cost. RITL, a subsidiary of RCIL includes Rs.3 crore (Previous year Rs.1 crore) for Salaries and Rs.6 crore (Previous year Rs.127 crore) for Finance Cost. Independent TV, a Wholly Owned Subsidiary of the Company includes Rs. Nil (Previous year Rs.36,35,354) for Salaries, Rs. Nil (Previous year Rs.21 crore) for Finance Cost. RTL, a Subsidiary of the Company includes Rs. Nil (Previous year Rs.47,45,638) for Salaries, Rs.1 crore (Previous year Rs.235 crore) for Finance Cost and Rs. Nil (Previous year Rs.8 crore) for Sales and General and Administration Expenses. RTSL, a Wholly Owned Subsidiary of the Company includes Rs.4 crore (Previous year Rs.62 crore) for Finance Cost. RWL, a Wholly Owned Subsidiary of the Company includes Rs. Nil (Previous year Rs.69 crore) for Finance Cost. RIIL, a Wholly Owned Subsidiary of the Company includes Rs. Nil (Previous year Rs.18,76,463 for Salaries and Rs. Nil (Previous year Rs.25 crore) for Finance Cost. RWML, a Wholly Owned Subsidiary of the Company includes Rs.10,072 (Previous year Rs.40,000) for Finance Cost. Expenses under the heads Selling, Marketing and Distribution are net of recovery of cost Rs. Nil (Previous year Rs.70,38,646) incurred for and on behalf of RWL. Finance cost is net of recovery of interest cost from respective subsidiaries as mentioned above for the fund used by them for their business.

Note 1.15

Corporate Social Responsibility

Note 1.16 Employee Benefits

Gratuity: In accordance with the applicable Indian laws, the Company provides for the gratuity, a defined benefit retirement plan (Gratuity Plan) for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employeeâs last drawn salary and for the years of employment with the Company.

The gratuity plan is governed by the Payment of Gratuity Act, 1972 (Gratuity Act). The Company is bound to pay the statutory minimum gratuity as prescribed under Gratuity Act. There are no minimum funding requirements for a gratuity plan in India. The Companyâs philosophy is to fund the benefits based on its own liquidity and tax position as well as level of underfunding of the plan vis-a-vis settlements. The management is responsible for the overall governance of the plan. The management has outsourced the investment management of the fund to insurance company which in turn manages these funds as per the mandate provided to them by the trustees and applicable insurance and other regulations.

The Company operates its gratuity and superannuation plans through separate trusts which is administered and managed by the Trustees. As on March 31, 2018 and March 31, 2017, the contributions towards superannuation plans have been invested in Insurer Managed Funds.

The plan is in the nature of a defined benefit plan which is sponsored by the Company and hence it underwrites all the risks pertaining to the plan. In particular, there is a risk for the Company that any significant change in salary growth or demographic experience or inadequate returns on underlying plan assets can result in an increase in cost of providing these benefits to employees in future.

The defined benefit plan exposes the Company to actuarial risks such as logentivity risks, interest risk and market (Investment) risk. The following table sets out the status of the Gratuity Plan as required under Ind AS 19 âEmployee Benefitsâ.

Provident Fund :Under this scheme, the employee and employer each make monthly contribution to the plan equal to 12% of the covered employeeâs basic salary. Contributions are made to the trust established by the Company. As at March 31, 2018, based on the actuarial valuation, Fair value of plan assets is Rs.186 crore (Previous year Rs.224 crore), the present value of defined benefit obligation is Rs.162 crore (Previous year Rs.206 crore). For the year ended March 31, 2018, the Company has contributed Rs.3 crore (Previous year Rs.5 crore) towards Provident Fund.

The assumptions made for the above are discount rate of 7.65%, average remaining tenure of Investment Portfolio is 5 years and guaranteed rate of return is 8.55%.

Note 1.17

Disclosure under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED)

Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from October 2, 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the company, the following disclosures are made for the amounts due to Micro and Small Enterprises.

Note 1.18

Disclosures required by Clause 34(3) and 53(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

Loans and Advances in the nature of Loans to Subsidiary Companies

Note 1.19

Employee Stock Option Schemes

The Company operates a Employee Stock Option Plan; ESOS Plan 2009, which cover eligible employees of the Company and its Subsidiaries. ESOS Plan 2008 was also operational till previous year. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the Option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted/ transferred one Equity Share of the Company of Rs.5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs.387 crore (Previous year Rs.387 crore) has been granted to the Trust and the said amount has been utilized by the Trust for purchasing Rs.2.13 crore (Previous year Rs.2.13 crore) Equity Shares during the period upto March 31, 2018. The fall in the value of these underlying shares on account of market volatility and loss, if any, can be determined only at the end of the exercise period under ESOS Scheme.

Amortization of compensation includes write back of Rs.1 crore (Previous year Rs.3,27,600) based on intrinsic value of Options which has been vested under ESOS Plan 2008 and reflected in Statement of Profit and Loss under Employees Benefit Expenses. No amount is chargeable in respect of Options granted under ESOS Plan 2009.

The weighted average remaining contractual life for the share options outstanding as at 31 March 2018 was less than a year.

If the entity would have estimated fair value computed on the basis of Black Scholes pricing model, the compensation cost for the year ended March 31, 2018 for ESOS Plan 2009 would have been Rs.2.06 crore. The key assumptions used to estimate the fair value of options are given below.

The expected life of the share options is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future trends, which may not necessarily be the actual outcome.

Note 1.20

Post Reporting Events

No adjusting or significant non-adjusting events have occurred between the reporting date and the date of authorisation.

Note 1.21

Discontinued Operations:

The Company has, pursuant to strategic transformation programme as a part of debt resolution plan and process of monetisation led by the Lenders, entered into definitive binding agreements with Reliance Jio Infocomm Limited (RJio) on 28th December 2017 for sale of Wireless Spectrum and Media Convergence Nodes (MCN) assets. Consequently, the said assets along with liabilities, revenue and expenses related thereto have been classified as Assets held for Sale (Refer Note 2.15) and wireless operations have been disclosed separately as discontinued operations in line with Ind AS 105 âNon-current Assets Held for Sale and Discontinued Operationsâ.

Note 1.22

Non Provision of Interest

The Company was engaged with Joint Lendersâ Forum (JLF), constituted on June 2, 2017 and under standstill period till December 2017 pursuant to the Strategic Debt Restructuring Scheme (SDR Scheme) of Reserve Bank of India (RBI). Consequent to circular of 12th February, 2018 of RBI, the Company continued to work closely with the Lenders to finalise an overall debt resolution plan. Pursuant to strategic transformation programme, as a part of debt resolution plan of the Company under consideration, inter alia of the Lenders, the Company and its subsidiaries; Reliance Telecom Limited (RTL) and Reliance Infratel Limited (RITL), with the permission of and on the basis of suggestions of the Lenders, had for monetization of some specified Assets, entered into definitive binding agreements with Reliance Jio Infocomm Limited (RJio) on December 28, 201 7 for sale of Wireless Spectrum, Towers, Fiber and Media Convergence Nodes (MCNs). Further, the Company has also entered into a definitive binding agreement with Pantel

Technologies Private Limited and Veecon Media and Television Limited for sale of its subsidiary company having DTH Business. The Company and its said subsidiaries expected to close these transactions in a phased manner. In the meanwhile, Honâble National Company Law Tribunal (NCLT), Mumbai has, overruling the objections of the Company as also its lenders represented by State Bank of India, the lead member, vide its order dated May 15, 2018 admitted applications filed by an operational creditor for its claims against the Company and its subsidiaries; RTL and RITL and thereby admitted the companies to debt resolution process under the Insolvency and Bankruptcy Code, 2016 (IBC). As a consequence, Interim Resolution Professionals (IRPs) were appointed vide NCLTâs order dated May 18, 2018. The Company along with the support of the lenders filed an appeal with Honâble National Company Law Appellate Tribunal (NCLAT) challenging the order of NCLT admitting the Company to IBC proceedings. The Honâble NCLAT, vide its order dated May 30, 2018, stayed the orders passed by NCLT and consequently, the Board of the respective Companies stands reinstated. Further, Minority Shareholders holding 4.26% stake in RITL had accused the management of RITL of âOppression of minority shareholders and mismanagementâ and filed a petition in NCLT. Based on an amendment to the Petition, the NCLT stayed RITLâs proposed asset sale (Tower and Fibre). The parties have subsequently settled the dispute and the restriction on sale stands vacated. The Company is confident that a suitable debt resolution plan would be formulated along with its lenders as per the strategic transformation programme.

During the year, considering all the factors including the Companyâs request for waiver of interest and admission of the Company to debt resolution process under the IBC, the Company, with a view to reflecting fairly the position for the purpose of presentation in respect of the Companyâs obligation for interest and without implying in any way that the terms of lending by banks and the other lenders are altered, has not provided interest of Rs.3,055 crore. Had the Company provided Interest, the Loss would have been higher by Rs.3,055 crore, but the impact is likely to be nil if request for waiver is accepted by lenders.

Note 1.23 Related Parties

As per the Ind AS 24 âRelated Party Disclosuresâ as referred to in Accounting Standard Rules, the disclosure of transactions with the related parties as defined therein are given below. All transactions entered into by the Company with related parties, were in ordinary course of business and on armâs length basis.

Some of the key management personnel of the Company are also covered under the Companyâs Gratuity Plan along with other employees of the Company. Proportionate amounts of gratuity accrued under the Companyâs Gratuity Plan have not been separately included in the above disclosure.

Note 1.24

Segment Performance

Disclosure as per Ind AS 108 âOperating Segmentsâ is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of Ind AS.

Note 1.25

Authorisation of Financial Statements

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

Mar 31, 2017

Note:1.

Foreign Currency Monetary Items; Long Term

In view of the option allowed pursuant to the notification dated December 29, 201 1 issued by the Ministry of Corporate Affairs (MCA),Government of India, for the year ended on March 31, 2017, the Company has reduced by '' 182 crore (Previous year added '' 818 crore) of exchange differences on long term borrowings relating to the acquisition of depreciable capital assets to the cost of capitalised assets. Further, the Company has reduced foreign currency variations of Rs, 77 crore (Previous year accumulated Rs, 288 crore) arising on other long-term foreign currency monetary items in FCMITDA and Rs, 238 crore (Previous year Rs, 274 crore) has been amortized during the year, leaving balance to be amortized over the balance period of loans.

Schemes of Amalgamation and Arrangement

1 Pertaining to earlier years,

The Company, in the earlier years, underwent various restructuring Schemes through Court including restructuring of ownership of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon''ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Notes to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs, 8,047 crore being Securities Premium Account, which was part of the Securities Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of Rs, 5,538 crore representing the unadjusted balance being the excess of assets over liabilities relatable to the Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs, 2,785 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to the Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III of Rs, 6,763 crore comprises of Rs, 4,159 crore transferred to General Reserve from Statement of Profit and Loss and Rs, 2,603 crore arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs, 1 crore of erstwhile Global Innovative Solutions Private Limited.

(v) Reserve for Business Restructuring of Rs, 1,287 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited, the Holding company of Reliance Infratel Limited after withdrawing an amount equivalent to writing off passive infrastructure assets, transferred to RITL, to the Statement of Profit and Loss. Balance in Reserve for Business Restructuring shall be available to meet increased depreciation, costs, expenses and losses including on account of impairment of or write down of assets etc.

(vi) Additional depreciation of Rs, 1,205 crore (Previous year Rs, 1,190 crore) arising on fair value of the assets has been adjusted, consistent with the practice followed in earlier years, to General Reserve as permitted pursuant to the Scheme of Arrangement sanctioned vide an order dated July 3, 2009 by the Hon''ble High Court and as determined by the Board of Directors.

(vii) Also refer note 2.44 "Exceptional Items" below.

2 The Scheme of Arrangement between the Company and Sistema Shyam Teleservices Limited (SSTL or the Transferor Company) for demerger of the Telecom Business Undertaking into the Company has been approved by the Hon''ble High Courts of Rajasthan and Bombay on September 30 and October 7, 2016 respectively. Pursuant to the Scheme, the Company will, towards consideration of the said Undertaking, issue and allot to SSTL, 27,65,53,305 fully paid up equity shares of '' 5 each aggregating to 10% of the fully diluted paid up share capital of the Company and perform its obligations under transaction documents. Further, the Scheme of Arrangement between RTL, a wholly owned subsidiary (the Transferor Company) and the Company for demerger of the Telecom Undertaking comprising of 5 License Service Areas into the Company has been approved by the Hon''ble High Court of Bombay on October 27, 2016. The effects shall be considered when the aforesaid Schemes become effective upon regulatory compliance.

3 Pursuant to an approval by BSE Limited and National Stock Exchange of India Limited, the Company has filed the Scheme of Arrangement ("the Scheme") on March 10, 2017 with the Mumbai Bench of the National Company Law Tribunal ("NCLT") for demerger of the Wireless Business Undertaking of the Company and RTL, a Subsidiary of the Company into Aircel Limited (AL) and its subsidiary, Dishnet Wireless Limited (DWL), and on the basis that in accordance with the Scheme, the Company would hold 50% ownership interest in AL.

4 Pursuant to execution of the Acquisition Agreement dated December 21, 2016 between the Company and Brookfield Infrastructure Group ("Brookfield") in relation to the transfer of RITL''s nationwide tower business and related infrastructure to Brookfield, a Scheme of Arrangement ("the Scheme") under Section 230 to 240 of the Companies Act, 2013 has been filed on January 30, 201 7 with the Mumbai Bench of the NCLT for demerger of Tower Business of RITL, a subsidiary into another subsidiary namely Towercom Infrastructure Private Limited ("Towercom"), which on transfer thereof upon completion of the said Scheme will be wholly owned and independently managed by affiliates of Brookfield. The consideration subject to adjustment as per the Acquisition Agreement shall be discharged by issue of Non Convertible Debentures of the face value of Rs, 6,900 crore and Redeemable Preference Shares of the face value of Rs, 100 crore (subject to adjustment as per the Acquisition Agreement between the Company, RITL a subsidiary of the Company and Brookfield). plus takeover of debt of upto Rs, 4,000 crore. Also, in accordance with the Share Subscription Agreement dated December 21, 2016, the Company will be entitled to subscribe by itself or through eligible nominees specified nonvoting shares of Towercom which based on certain conditions will entitle the holder of the said shares to 49% of the future economic upside from the said Tower Business. Considering that the Agreements are subject to various conditions precedent, no effect is given to these agreements and Scheme in the Accounts.

(v) Spectrum Charges

DoT has, during the earlier years, issued demand on the Company for Rs, 1,758 crore towards levy of one time Spectrum Charges, being the prospective charges for holding CDMA spectrum beyond 2.5 MHz for the period from January 1, 2013 till the expiry of the initial terms of the respective Licenses. Based on a petition filed by the Company, the Hon''ble High Court of Kolkata, vide its order dated February 14 and April 19, 2013 has stayed the operation of such impugned demand till further order. The Company is of the view that the said demand, inter alia, is an alteration of financial terms of the licenses issued in the past and has also been advised so legally. Accordingly, no provision in this regard is required.

(vi) License Fees and Special Audit

Pursuant to the Telecom License Agreement, DoT directed audit of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company for the years ended March 31, 2007 and March 31, 2008 relating to license fees and revenue share. The Company has received show cause notice dated January 31, 2012 and subsequently, received demand note dated November 8, 2012 based on report of the Special Audit directed by DoT relating to alleged shortfall of license fees of Rs, 300 crore and interest thereon as applicable. The Company has challenged the said notices, inter alia demanding license fee on non telecom revenue based on Special Audit Report before the Hon''ble Telecom Disputes Settlement and Appellate Tribunal (TDSAT) and also before the Hon''ble High Court of Kerala. The impugned demand has been stayed by Hon''ble High Court of Kerala during the pendency of the Petition. Meanwhile, Hon''ble TDSAT vide its judgement dated April 23, 201 5 has set aside all License fee related demands and directed DoT to rework the license fees payable by the operators for the past periods, in light of the findings, observations and directions made in the said judgment and to issue fresh demands, which the operators will pay within the time prescribed under the law. DoT has challenged the said TDSAT judgment in Hon''ble Supreme Court and has not revised/raised any fresh demand. The matter is pending before Hon''ble Supreme Court, though Hon''ble Supreme Court vide its order dated February 29, 201 6 allowed DoT to raise demand as per its understanding but not to enforce the same till the appeals are finally decided by the Supreme Court. As per the judgment of Hon''ble TDSAT dated April 23, 2015 which is operative as on date and other judicial pronouncements directly applicable to the issues of License fee dues raised by Special Auditors, there shall not be any liability of License fee and hence, no provision is required in the accounts of the Company.

4. Financial Risk Management Objectives and Policies

Activities of the Company expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company''s primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

The Company has instituted a self governed framework based on identification of potential risk areas, evaluation of risk intensity, and clear- cut risk mitigation policies, plans and procedures, both at the enterprise and operating levels. The framework seeks to facilitate a common organizational understanding of the exposure to various risks and uncertainties at an early stage, followed by timely and effective mitigation. This framework is reviewed at periodic intervals.

Financial risk management

The Company''s business activities expose it to a variety of financial risks, namely liquidity risk, market risks and credit risk.

Market risk

As a result operations of the Company are adversely affected as rupee appreciates/ depreciates against US Dollar.

Interest Rate Risk

I nterest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates, in cases where the borrowings are measured at fair value through profit or loss. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates.

Exposure to Interest Rate Risk

Interest rate risk of the Company arises from borrowings. The Company endeavor to adopt a policy of ensuring that maximum of its interest rate risk exposure is at fixed rate. The Company''s interest-bearing financial instruments are reported as below:

Fair value sensitivity analysis for fixed-rate instruments

Cash flow sensitivity analysis for variable-rate instruments

If interest rate is positively affected with i.e. decrease by 100 basis point, loss shall also accordingly be affected.

Derivative financial instruments

The Company does not hold derivative financial instruments

The Company offsets financial asset and financial liability when it currently has a legally enforceable right to set off the recognized amounts and the Company intends either to settle on a net basis or realise the asset and settle the liability simultaneously.

Credit risk

Credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks and financial institutions with high credit ratings assigned by international and/or domestic credit rating agencies. Investments primarily include investment in liquid mutual fund units, quoted bonds issued by Government and Quasi Government organizations and certificates of deposit which are funds deposited at a bank for a specified time period.

Liquidity risk

The Company''s principal sources of liquidity are cash and cash equivalents and the cash flow that is generated from operations. Competative intensity has adversely impacted revenue and consequent cash accruals during the year. This, coupled with current level of debt and imminent repayment obligations, has lead to stress on liquidity profile. The Company closely monitors its liquidity position and is attempting to enhance its sources of funding by increasing cash flow generated from its operations and realisations from other proposed measures.

Prudence requires liquidity risk to be managed in addition to market, credit and other risks as it has tendency to compound other risks. It entails management of asset, liabilities focused on a medium to long-term perspective and future net cash flows on a day-by-day basis in order to assess liquidity risk.

Current and prospective liquidity risk is encountered when the Company is required to meet its obligations. The Company''s approach to managing liquidity, that it will have sufficient cash and financial assets to meet its obligations and collateral needs, both expected and unexpected, under normal and stressed conditions, without incurring unacceptable losses. Dynamic nature of the underlying businesses necessitates that the treasury function ensures flexibility in funding by maintaining adequate working capital and availability under committed credit lines, for uninterrupted business operations. Existing operations of the Company are primarily funded through long term loans and advances. The Company is seeking to maintain/ enhance the level of working capital credit lines, so that operations are performed at optimum level.

Periodic budgets and rolling forecasts are prepared at the level of operating subsidiaries as regular practice and in accordance with limits specified by the Company. 49% of the total debt will be payable in less than one year i.e. during the financial year ended as at March 31, 2018. Apart from this, there is an outstanding principal of Rs, 18,738 crore and interest as applicable thereon payable to the lenders. The Company believes that working capital credit lines need significant enhancement pending infusion of funds from the proposed strategic transactions/ sale of assets and rolling over of loans with existing lenders.

Note: 2.44 Exceptional Items

Pursuant to the direction of the Hon''ble High Court of Judicature of Mumbai and option exercised by the Board of the Company, in accordance with and as per the Scheme of Arrangement ("the Scheme") approved by the Hon''ble High Court vide order dated July 3, 2009 binding on the Company, expenses and/ or losses, identified by the Board of the Company as being exceptional or otherwise subject to the Accounting treatment prescribed in the Schemes and comprising of Rs, 433 crore (Previous year Rs, 467 crore) of depreciation consequent to addition of exchange differences on long term borrowing relating to capital assets to the cost of capitalised assets, as also Rs, 8 crore (Previous year Rs, 3 crore) of exchange variation (net) on items other than long term monetary items, Rs, 238 crore (Previous year Rs, 274 crore) being amortization of FCMITDA excluding the portion added to the cost of fixed assets or carried forward as FCMITDA in accordance with Para 46 A inserted into the then applicable Accounting Standard (AS) 11 "The Effects of changes in Foreign Exchange Rates" in the context of unprecedented volatility in exchange rate during the year have been met by withdrawal from corresponding General Reserves, leaving no impact on loss for the year ended March 31, 2017. Such withdrawals have been included/ reflected in the Statement of Profit and Loss. The Company has been legally advised that such inclusion in the statement of Profit and loss is in accordance with Schedule III of the Companies Act, 2013. Had such write off of expenses, losses and depreciation/ amortization (refer note 2.36.1(vi) not met from General Reserve, the Company would have reflected a Loss after tax for the year of Rs, 3,680 crore (Previous year loss after tax of Rs, 2,313 crore).

Note: 5

Recovery of the Expenses

Expenses are net of recoveries for common cost from; RCIL, a Wholly Owned Subsidiary of the Company, includes Rs, Nil (Previous year Rs, 12 crore) for Network Expenses,Rs, 31,72,015 (Previous year Rs, 28,06,098) for Salaries, Rs, 197 crore (Previous year Rs, 227 crore) for Finance Cost. RIDC, a Wholly Owned Subsidiary of RWL, includes Rs, 168 crore (Previous year Rs, 149 crore) for Network Expenses, Rs, 11 crore (Previous year Rs, 4 crore) for Finance Cost. RITL, a subsidiary of RCIL includes Rs, 1 crore (Previous year Rs, Nil) for Salaries and Rs, 127 crore (Previous year Rs, 150 crore) for Finance Cost. RBTV, a Wholly Owned Subsidiary of the Company includes Rs, 36,35,354 (Previous year Rs, 34,58,486) for Salaries, Rs, 21 crore (Previous year Rs, 106 crore) for Finance Cost. RTL, a Subsidiary of the Company includes Rs, 47,45,638 (Previous year Rs, 43,26,895) for Salaries, Rs, 235 crore (Previous year Rs, 199 crore) for Finance Cost and Rs, 8 crore (Previous year Rs, 55 crore) for Sales and General and Administration Expenses. RTSL, a Wholly Owned Subsidiary of the Company includes Rs, 62 crore (Previous year Rs, 134 crore) for Finance Cost. RWL, a Wholly Owned Subsidiary of the Company includes Rs, 69 crore (Previous year Rs, 120 crore) for Finance Cost. RIIL, a Wholly Owned Subsidiary of the Company includes Rs, 18,76,463 (Previous year Rs, 14,57,013 for Salaries and Rs, 25 crore (Previous year Rs, 110 crore) for Finance Cost. rWmL, a Wholly Owned Subsidiary of the Company includes Rs, 40,000 (Previous year Rs, Nil) for Finance Cost. Expenses under the heads Selling, Marketing and Distribution are net of recovery of cost Rs, 70,38,646 (Previous year Rs, 87 crore) incurred for and on behalf of RWL. Finance cost is net of recovery of interest cost from respective subsidiaries as mentioned above for the fund used by them for their business.

Note 6

Corporate Social Responsibility

Note 7 Employee Benefits

The Company operates its gratuity and superannuation plans through separate trusts which is administered and managed by the Trustees. As on March 31, 2017 and March 31, 2016, the contributions towards superannuation plans have been invested in Insurer Managed Funds.

The defined benefit plan exposes the Company to actuarial risks such as logentivity risks. interest risk and market (Investment) risk.

Mortality in Retirement: LIC Buy-out Annuity Rates & UK Published PA (90) Annuity Rates suitably adjusted for Indian Lives. The estimates of future salary increases considered in actuarial valuation take into account inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

The expected contribution is based on the same assumptions used to measure the company''s gratuity obligations as of March 31, 2017.

(x) Sensitivity Analysis

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below.

Provident Fund: Under this scheme, the employee and employer each make monthly contribution to the plan equal to 12% of the covered employee''s basic salary. Contributions are made to the trust established by the Company. As at March 31, 2017, based on the actuarial valuation, Fair value of plan assets is '' 224 crore (Previous year '' 253 crore), the present value of defined benefit obligation is '' 206 crore (Previous year '' 237 crore). For the year ended March 31,2017, the Company has contributed '' 5 crore (Previous year '' 4 crore) towards Provident Fund.

The assumptions made for the above are discount rate of 7.52%, average remaining tenure of Investment Portfolio is 5 years and guaranteed rate of return is 8.65%.

8 Disclosure under Micro, Small and Medium Enterprises

Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from October 2, 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the Company, the following disclosures are made for the amounts due to the Micro and Small Enterprises.

Loans and Advances to Campion Properties Limited and Reliance Globalcom B.V. are interest free where there is no repayment schedule and are repayable on demand.

9.Employee Stock Option Schemes

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the Option) is accounted as deferred employee compensation, which is amortized on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted/ transferred one Equity Share of the Company of '' 5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS Plans for the benefit of its present and future employees. Advance of Rs, 387 crore (Rs, 387 crore as on March 31,2016 and as on April 1, 2015) has been granted to the Trust and the said amount has been utilized by the Trust for purchasing 2.13 crore (2.13 crore as on March 31,2016 and as on April 1, 2015) Equity Shares during the period up to March 31, 2017. The fall in the value of these underlying shares on account of market volatility and the loss, if any, can be determined only at the end of the exercise period under ESOS Scheme.

Amortization of compensation includes write back of Rs, 3,27,600 (Rs, 13,09,300 as on March 31, 2016 and Rs, 2 crore as on April 1, 2015) based on intrinsic value of Options which has been vested under ESOS Plan 2008 and reflected in Statement of Profit and Loss under Employees Benefits Expenses. No amount is chargeable in respect of Options granted under ESOS Plan 2009.

The weighted average remaining contractual life for the share options outstanding as at March 31, 2017 was 2.94 years (March 31, 2016: 2.60 years)

If the entity would have estimated fair value computed on the basis of Black Scholes pricing model, the compensation cost for the year ended March 31, 2017 for ESOS Plan 2008 and ESOS Plan 2009 would have been Rs, 0.35 crore and Rs, 1.22 crore respectively. The key assumptions used to estimate the fair value of options are given below.

Note 2.51 Post Reporting Events

No adjusting or significant non-adjusting events have occurred between the reporting date and the date of authorisation.

Note 2.53 Related Parties

As per the Ind AS 24 "Related Party Disclosures" as referred to in Accounting Standard Rules, the disclosure of transactions with the

related parties as defined therein are given below. All transactions entered into by the Company with related parties, were in ordinary course of business and on arm''s length basis.

A List of Related Parties: where control exists

(i) Subsidiary Companies (i) Subsidiary Companies

(direct and step down subsidiaries) (direct and step down subsidiaries)

1 Reliance WiMax Limited (RWML) 37 FLAG Telecom Hellas AE

2 Reliance Bhutan Limited 38 FLAG Telecom Asia Limited

3 Reliance Webstore Limited (RWL) 39 FLAG Telecom Nederland B.V.

4 Reliance Infocomm Infrastructure Limited (RIIL) 40 Reliance Globalcom (UK) Limited

5 Campion Properties Limited 41 Yipes Holdings Inc.

6 Reliance Big TV Limited (RBTV) 42 Reliance Globalcom Services Inc.

7 Reliance Tech Services Limited (RTSL) 43 YTV Inc.

8 Reliance Telecom Limited (RTL) 44 Reliance Infocom Inc.

9 Reliance Communications Infrastructure Limited (RCIL) 45 Reliance Communications Inc. (RCI)

10 Reliance IDC Limited (RIDC) 46 Reliance Communications International Inc. (RCII)

11 Reliance Infratel Limited (RITL) 47 Reliance Communications Canada Inc.

12 Reliance Mobile Commerce Limited 48 Bonn Investment Inc.

13 Reliance BPO Private Limited 49 FLAG Telecom Development Limited

14 Reliance Globalcom Limited 50 FLAG Telecom Development Services Company LLC

15 Reliance Communications Tamilnadu Limited 51 FLAG Telecom Network Services Limited

16 Reliance Infra Realty Limited 52 Reliance FLAG Telecom Ireland Limited (FLAG Ireland)

17 Reliance Infra Projects Limited 53 FLAG Telecom Japan Limited

18 Realsoft Cyber Systems Private Limited 54 FLAG Telecom Ireland Network Limited

19 Worldtel Tamilnadu Private Limited 55 FLAG Telecom Network USA Limited

20 Internet ExchangeNext.com Limited 56 FLAG Telecom Espana Network SAU

21 Reliance Globalcom B.V. (RGBV) 57 Reliance Vanco Group Ltd

22 Reliance Communications (UK) Limited (RCUK) 58 Euronet Spain SA

23 Reliance Communications (Hong Kong) Limited 59 Vanco (Shanghai) Co Ltd.

24 Reliance Communications (Singapore) Pte. Limited 60 Vanco (Asia Pacific) Pte. Ltd.

25 Reliance Communications (New Zealand) Pte. Limited 61 Vanco Australasia Pty. Ltd.

26 Reliance Communications (Australia) Pty. Limited 62 Vanco Sp Zoo

27 Anupam Global Soft (U) Limited 63 Vanco Gmbh

28 Gateway Net Trading Pte Limited 64 Vanco Japan KK

29 Reliance Globalcom Limited, Bermuda (RGL, Bermuda) 65 Vanco NV

30 FLAG Telecom Singapore Pte. Limited 66 Vanco SAS

31 FLAG Atlantic UK Limited 67 Vanco South America Ltda

32 Reliance FLAG Atlantic France SAS (FLAG France) 68 Vanco Srl

33 FLAG Telecom Taiwan Limited 69 Vanco Sweden AB

34 Reliance FLAG Pacific Holdings Limited 70 Vanco Switzerland AG

35 FLAG Telecom Group Services Limited 71 Vanco Deutschland GmbH (Formerly known as GCX Services Limited) 72 V_anco BV

³⁶ FLAG Telecom Deutschland GmbH 73 Vanco Benelux BV

(i) Subsidiary Companies (iii) Enterprises over which individual described in (direct and step down subsidiaries) Sr. No. A (iii) above having control

74 Vanco UK Ltd 1 Reliance Capital Limited (RCL)

⁷⁵ Vanco International Ltd 2 Reliance Capital Asset Management Limited (RCAML)

⁷⁶ Vanco Row Limited 3 Reliance General Insurance Company Limited

⁷⁷ Vanco Global Ltd 4 Reliance Commodities Limited

⁷⁸ VNO Direct Ltd 5 Reliance Money Precious Metals Private Limited

⁷⁹ Vanco US LLC 6 Reliance Money Express Limited

80 Vanco Solutions Inc

7 Reliance Home Finance Limited

81 Net Direct SA (Proprietary) Ltd. (Under liquidation)

8 Reliance Securities Limited

82 Global Cloud Xchange Limited

9 Reliance Financial Limited

83 GCX Limited

10 Reliance Money Solutions Private Limited

84 Aircom Holdco B.V (w.e.f 18.07.201 6)

11 Reliance Wealth Management Limited

85 Onyx NewCo LLC (acquired on 15.11.2016 and ceased

to b_{e su}b_sidi_ary _on 16.11.2016) 12 Reliance Corporate Advisory Services Limited (formerly

Reliance Spot Exchange Infrastructure Limited)

86 Towercom Infrastructure Private Limited (w.e.f

17.11.2016) 13 Reliance Infrastructure Limited

87 Seoul Telenet Inc. 14 Mumbai Metro One Private Limited

88 FLAG Holdings (Taiwan) Limited 15 Reliance Sealink One Private Limited

89 Reliance Telecom Infrastructure (Cyprus) Holdings 16 HK Toll Road Private Limited

17 Parbati Koldam Transmission Company Limited

90 Lagerwood Investments Limited

18 GF Toll Road Private Limited

(ii) Holding Company

19 KM Toll Road Private Limited

Reliance Innoventures Private Limited

20 DA Toll Road Private Limited

(iii) Individuals Promoters

21 Reliance Energy Limited

Shri Anil D. Ambani, the person having control during

the year 22 DS Toll Road Limited

(iv) Key Managerial Person 23 Reliance Defence Limited Shri Prakash Shenoy, Company Secretary and Manager 24 BSES Kerala Power Limited

B List of Other Related Parties: where there have been 25 Vidarbha Industries Power Limited

^transactions ₂₆ Reliance Power Limited

(i) Associates

27 Sasan Power Limited

1 Warf Telecom International Private Limited

28 Rosa Power Supply Company Limited

2 Mumbai Metro Transport Private Limited

.... 29 Jharkhand Integrated Power Limited

(ii) Fellow Subsidiary Company

30 Tato Hydro Power Private Limited

1 Reliance Big Entertainment Private Limited

2 Reliance Big Broadcasting Private Limited ³¹ Rajasthan Sun Technique Energy Private Limited

3 Big Animation (India) Private Limited ³² Chitrangi Power Private Limited

4 Big Flicks Private Limited ³³ Reliance Cleang^{en Limited (RCGL)}

5 Zapak Digital Entertainment Limited ^{(iv) Employee Benefits Trus}t

6 Zapak Mobile Games Private Limited 1 Reliance Infocomm Limited Employees Provident Fund

7 Ralston Trading Private Limited 2 Reliance Infocomm Limited Employees Gratuity Fund

8 Reliance Infrastructure Management Private Limited 3 Reliance Infocomm Limited Employees Superannuation (Formerly AAA Infrastructure Finance Management Schemes

Private Limited)

9 Nationwide Communications Private Limited (w.e.f

31.05.2016)

10 MedyBiz Private Limited

Some of the key management personnel of the Company are also covered under the Company''s Gratuity Plan along with the other employees of the Company. Proportionate amounts of gratuity accrued under the Company''s Gratuity Plan have not been separately included in the above disclosure.

Note10.

Segment Performance

Disclosure as per Ind AS 108 "Operating Segments" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of Ind AS.

Note 11.

Authorization of Financial Statements

The financial statements for the year ended March 31, 2017 were approved by the Board of Directors on May 27, 2017.

Mar 31, 2015

Note: 1.

Previous year

Figures of the previous year have been regrouped and reclassified, wherever required. Amount in Financial Statements are presented in Rupee crore, except as otherwise stated.

Note: 2.

Foreign Currency Monetary Items

In view of the option allowed pursuant to the notification dated December 29, 2011 issued by the Ministry of Corporate Affairs (MCA),Government of India, for the year ended on March 31, 2015, the Company has added Rs. 583 crore (Previous year Rs. 1432 crore) of exchange differences on long term borrowing relating to the acquisition of depreciable capital assets to the cost of capitalized assets. Further, the Company has accumulated foreign currency variations of Rs. 206 crore (Previous year Rs. 541 crore) arising on other long-term foreign currency monetary items in FCMITDA and Rs. 199 crore (Previous year Rs. 254 crore) has been amortised during the year, leaving balance which will be amortized over the balance period of loans.

Note: 3.

Schemes of Amalgamation and Arrangement of the earlier years

The Company, during the previous years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon'ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Notes to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs. 8,047 crore being Securities Premium Account, which was part of the Securities Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of Rs. 5,538 crore representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs. 2,785 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III of Rs. 12,375 crore comprises of Rs. 4,159 crore transferred to General Reserve from Statement of Profit and Loss and Rs. 8,215 crore arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs. 1 crore of erstwhile Global Innovative Solutions Private Limited.

(v) Reserve for Business Restructuring of Rs. 1,287 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited, the Holding company of Reliance Infratel Limited after withdrawing an amount equivalent to writing off Passive Infrastructure assets, transferred to RITL, to the Statement of Profit and Loss. Balance in Reserve for Business Restructuring shall be available to meet the increased depreciation, costs, expenses and losses including on account of impairment of or write down of assets etc.

(vi) Additional depreciation of Rs. 1,177 crore arising on fair value of the assets has been adjusted, consistent with the practice followed in earlier years, from General Reserve III as permitted pursuant to the Scheme of Arrangment (the Scheme) sanctioned vide an order dated July 3, 2009 by the Hon'ble High Court and as determined by the Board of Directors.

(vii) During the previous year, the Company has adjusted Rs. 47 crore additional depreciation arising on fair value of the assets from Provision for Business Structuring.

(viii) Also Refer Note 2.38 "Exceptional Items" below.

Note: 4.

Provisions

(i) Provisions include, provision for disputed claims of verifcation of customers Rs. 9 crore (Previous year Rs. 9 crore) and others of Rs. 1,206 crore (Previous year Rs. 1,206 crore).

The aforesaid provisions shall be utilised on settlement of the claims, if any, there against.

(ii) During the earlier years, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon'ble High Court of Judicature at Mumbai vide orders dated July 21, 2006 and August 10, 2006 (revised) and by Hon'ble High Court of Gujarat vide order dated July 18, 2006, out of the excess of fair value of assets over liabilities, Rs. 3,000 crore was credited to and held as Provision for Business Restructuring (PBR) to meet increased depreciation cost, expenses and losses including on account of impairment or write down of assets which would be suffered by the Company, pursuant to the Scheme or otherwise in course of its business or in carrying out such restructuring of the operations of the Company or its Subsidiaries. The Company had reassessed the requirement for maintaining such PBR and based thereon, reversed balance of Rs. 441 crore during the previous year as no longer required. The said amount on reversal of PBR was reflected as part of Other Income during the previous year.

Note: 5.

Contingent Liabilities and Capital Commitment (as represented by the Management)

(Rs. in crore)

As at As at March 31, 2015 March 31, 2014

(i) Estimated amount of contracts remaining to be executed on 781 282 capital accounts (net of advances) and not provided for

(ii) Disputed Liabilities in Appeal

- Sales Tax and VAT 20 22

- Excise and Service Tax 23 29

- Entry Tax and Octroi 37 34

- Income Tax 451 303

- Other Litigations 1,689 1,354

(iii) Guarantees given by the Company on behalf of its Subsidiaries 5,237 4,791

(iv) Guarantees given by the Company on behalf of other companies 10 12 for business purpose

(v) Spectrum Charges

Department of Telecommunication (DoT) has, during the earlier years, issued demand on the Company for Rs. 1,758 crore towards levy of one time Spectrum Charges, being the prospective charges for holding CDMA Spectrum beyond 2.5 MHz for the period from January 1, 2013 till the expiry of the initial terms of the respective Licenses. Based on a petition fled by the Company, the Hon'ble High Court of Kolkata, vide its order dated April 19, 2013 has stayed the operation of such impugned demand till further order. The Company is of the opinion that the said demand, inter alia, is an alteration of financial terms of the licenses issued in the past and has also been legally advised. Accordingly, no provision in this regard is required.

(vi) License Fees and Special Audit

Pursuant to the Telecom License Agreement, Department of Telecommunications (DoT) directed audit of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company for the years ended March 31, 2007 and March 31, 2008 relating to license fees and revenue share. The Company has received show cause notice dated January 31, 2012 and subsequently, received demand note dated November 8, 2012 based on report of the Special Audit directed by DoT relating to alleged shortfall of license fees of Rs. 300 crore and interest thereon as applicable. The Company has challenged the said notices, inter alia demanding license fee on non telecom revenue based on Special Audit Report before the Hon'ble Telecom Disputes Settlement and Appellate Tribunal (TDSAT) and also before the Hon'ble High Court of Kerala. The impugned demand has been stayed by Hon'ble High Court of Kerala during the pendency of the Petition. Meanwhile, Hon'ble TDSAT vide its judgment dated April 23, 2015 has set aside all License fee related demands and directed DoT to rework the license fees payable by the operators for the past periods, in light of the findings, observations and directions made in the said judgment and to issue fresh demands, which the operators will pay within the time prescribed under the law. As per the judgment of Hon'ble TDSAT and other judicial pronouncements directly applicable to the issues of License fee dues raised by Special Auditors, there shall not be any liability of License fee and hence, no provision is required in the accounts of the Company.

(vii) Spectrum Auction

The Company, successfully bid in the 10 service areas and won spectrum including additional spectrum at a total cost of Rs. 1,706 crore. The validity of the above spectrum will be for a fresh 20 year period starting from the effective date as mentioned in the Letter of Intent (LOI) when issued, which, in case of spectrum blocks currently held by the existing licensees, should be the date of expiry of existing licenses. As per the payment options available, the Company has opted for the deferred payment and has made upfront payment of Rs. 441 crore on April 8, 2015 and balance Rs. 2,491 crore is payable in 10 annual installments starting from FY 2017-18. Pending completion of subsequent formalities as per the Notice Inviting Applications (NIA) for the auction and any orders that may be passed by Hon'ble Supreme Court in related and connected matters currently before it.

Note: 6.

Export Commitments

The Company has obtained licenses/ authorisations under the Export Promotion Capital Goods (EPCG) Scheme for importing capital goods at a concessional rate of customs duty against submission of bonds. Under the terms of the respective licenses/ authorisations, the Company is required to export goods of FOB value equivalent to or more than, eight times the amount of duty saved in respect of such licenses/ authorisations, where export obligation has been refixed by the order of Director General Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, as applicable. The Company has fulfilled its export obligation under the aforesaid license as on March 31, 2015 and has submitted the necessary documents to DGFT for availing discharge letter for completion of export obligation amounting to Rs. Nil (Previous year Rs. 334 crore).

Note: 7.

Segment Performance

Disclosure as per Accounting Standard ("AS") 17 "Segment Reporting" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of AS.

Note: 8.

Exceptional Items

(a) During the year ended March 31, 2015, the Company has revised the existing terms of lease of optic fibre cable availed from its subsidiary, as required in line with arm's length pricing, with effect from April 1, 2014. Accordingly, lease rent equalisation liabilities of Rs. 4,328 crore for is reversed / written back as an exceptional item.

During the year, terms of Redeemable Preference Shares (RPS) issued by a subsidiary have been revised. Yield on RPS has been revised to 0.1% from 8.85% per annum, and accordingly amount earlier recognised of Rs. 1,359 crore is charged off as an exceptional item in Statement of Profit and Loss.

(b) Pursuant to the direction of the Hon'ble High Court of Judicature of Mumbai and option exercised by the Board of the Company, in accordance with and as per the scheme of arrangement approved by the Hon'ble High Court vide order dated July 3, 2009 binding on the Company, expenses and/ or losses, identified by the Board of the Company as being exceptional or otherwise subject to the Accounting treatment prescribed in the Schemes of Arrangement sanctioned by the Hon'ble High Court and comprising of Rs. 387 crore (Previous year Rs. 333 crore) of depreciation consequent to addition of exchange differences on long term borrowing relating to capital assets to the cost of capitalised assets, as also Rs. 31 crore (Previous year Rs. 54 crore) of exchange variation (net) on items other than long term monetary items, Rs. 199 crore (Previous year Rs. 254 crore) being amortization of FCMITDA excluding the portion added to the cost of fixed assets or carried forward as FCMITDA in accordance with Para 46 A inserted into (AS) 11 " The Effects of changes in Foreign Exchange Rates" in the context of unprecedented volatility in exchange rate during the year have been met by withdrawal from corresponding General Reserves, leaving no impact on profit for the year ended March 31, 2015. Such withdrawals have been included/ reflected in the Statement of Profit and Loss. The Company has been legally advised that such inclusion in the Statement of Profit and Loss is in accordance with Schedule III of the Companies Act, 2013. Had such write off of expenses, losses and depreciation/ amortisation (refer note 2.29(vi)) not met from General Reserve, the Company would have reflected a Loss after tax for the year of Rs. 1,948 crore (Previous year profit after tax of Rs. 89 crore).

Note: 9.

Recovery of the Expenses

Expenses are net of recoveries for common cost from; Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company, includes to Rs. 149 crore (Previous year Rs. 196 crore) for Network Expenses, Rs. 37 crore (Previous year Rs. 51 crore) for Salaries, Rs. 472 crore (Previous year Rs. 371 crore) for Interest Expenses and Rs. 6 crore (Previous year Rs. 143 crore) for Sales and General and Administration Expenses, Reliance IDC Limited, a Wholly Owned Subsidiary of Reliance Webstore Limited, includes Rs. 110 crore (Previous year Rs. Nil) for Network Expenses, Rs. 18 crore (Previous year Rs. 21 crore) for Salaries, Rs. 9 crore (Previous year Rs. 14 crore) for Interest Expense, Rs. 2 crore (Previous year Rs. 3 crore) for Hire charges and Rs. 33,97,180 (Previous year Rs. 1crore) for Other General Administration Expenses, Reliance Infratel Limited, a subsidiary of Reliance Communications Infrastructure Limited includes Rs. 40 crore (Previous year Rs. 52 crore) for Salaries and Rs. 20 crore (Previous year Rs. 28 crore) for Sales and General and Administration Expenses comprising of Rs. 4 crore (Previous year Rs. 7 crore) for Hire Charges and Rs. 16 crore (Previous year Rs. 21 crore) for Other General and Administration Expenses, Reliance Big TV Limited, a Wholly Owned Subsidiary of the Company includes Rs. 14 crore (Previous year Rs. 15 crore) for Salaries, Rs. 99 crore (Previous year Rs. 93 crore) for Interest Expenses and Rs. 2 crore (Previous year Rs. 5 crore) for Other General and Administration Expenses including Hire charges, Reliance Telecom Limited, a Subsidiary of the Company includes Rs. 16 crore (Previous year Rs. 10 crore) for Network Expenses, Rs. 101 crore (Previous year Rs. 101 crore) for Salaries, Rs. 175 crore (Previous year Rs. 199 crore) for Interest Expenses and Rs. 81 (Previous year Rs. 113 crore) for Sales and General and Administration Expenses, Reliance Tech Services Limited, a Wholly Owned Subsidiary of the Company includes Rs. 11 crore (Previous year Rs. 12 crore) for Salaries, Rs. 9 crore (Previous year Rs. Nil) for Interest Expenses and Rs. 11 crore (Previous year Rs. 12 crore) for Other General and Administration Expenses including Hire Charges, Reliance Webstore Limited, a Wholly Owned Subsidiary of the Company includes Rs. 47 crore (Previous year Rs. 21 crore) for Salaries, Rs. 53 crore (Previous year Rs. 55 crore) for Interest Expense and Rs. 5 crore (Previous year Rs. 67 crore) for Sales and General and Administration Expenses comprising of Rs. 5 crore (Previous year Rs. 5 crore) for Hire Charges, Rs. Nil (Previous year Rs. 61 crore) for Selling and Marketing expenses and Rs. 1 crore (Previous year Rs. 1 crore) for Other General and Administration Expenses, Reliance Infocomm Infrastructure Limited, a Wholly Owned Subsidiary of the Company includes Rs. 29 crore (Previous year Rs. 27 crore) for Interest Expense and Rs. Nil (Previous year Rs. 34,48,272) for Salary, General and Administration Expenses. Expenses under the heads Selling, Marketing and Distribution are net of recoveries of cost of Rs. 699 crore incurred for and on behalf of Reliance Webstore Limited (RWSL), a wholly owned subsidiary of the Company. These costs pertain to the activities related to customer life cycle management undertaken by RWSL with effect from April 1, 2014. Finance costs is net of recovery of interest cost from respective subsidiaries as mentioned above for the fund used by them for their business.

Note: 10.

Transfer of Business Undertaking

The Company has entered into a Business Transfer Agreement with Reliance Communications Infrastructure Limited (RCIL), a Wholly Owned Subsidiary Company and accordingly all moveable assets comprising of fixed assets of Rs. 121 crore, current assets of Rs. 208 crore alongwith liabilities of Rs. 124 crore related to Internet Service Provider (ISP) Business Division, on "as is where basis" as a going concern, have been transferred w.e.f. June 01, 2014.

Note: 11.

Employee Benefits

Gratuity : In accordance with the applicable Indian laws, the Company provides for the gratuity, a defined benefit retirement plan (Gratuity Plan) for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employee's last drawn salary and for the years of employment with the Company

Note: 12.

Employee Stock Option Schemes

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the Option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted/ transferred one Equity Share of the Company of Rs. 5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs. 387 crore (Previous year Rs. 387 crore) has been granted to the Trust and the said amount has been utilized by the Trust for purchasing 2.13 crore (Previous year 2.13 crore) Equity Shares during the period upto March 31, 2015.The fall in the value of these underlying shares on account of market volatility and loss, if any, can be determined only at the end of the exercise period under ESOS Scheme.

Pursuant to the SEBI "Share Based Employee Benefit Regulations 2014 (the Regulation)" prescribing accounting treatment to be based on the Guidance Note on "Accounting for Employee Share Based Payments" issued by the ICAI, the Company has ceased to consolidate Financial Statements of the RCOM ESOS Trust with financial results for the year ended on March 31, 2015.The Company had, during the previous year, consolidated the financial statements of RCOM ESOS Trust as at March 31, 2014 with the Financial Statement of the Company in terms of SEBI (ESOS and ESPS) Guidelines, 1999 and the opinion of the Expert Advisory Committee (EAC) of The Institute of Chartered Accountants of India (the ICAI) and accordingly made comparable.

Mar 31, 2014

(1) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholders.

During the previous year ended March 31, 2013, the amount of per share dividend recognised as distributable to equity shareholders was Rs. 0.25.

(2) Consolidation of RCOM ESOS TRUST (Trust)

The Company has consolidated financial statements of RCOM ESOS Trust as at 31st March, 2014 with the Standalone Financial Statement of the Company in terms of SEBI (ESOS and ESPS) Guidelines, 1999 and recent opinion of the Expert Advisory Committee (EAC) of The Institute of Chartered Accountants of India (the ICAI).

The said Trust is holding 2,12,79,000 no. of equity shares of Rs. 5 each of the Company. Rs.11 crore being the face value of such equity shares is presented as deduction from the paid up share capital.

2.01.1 Debentures, Foreign Currency Loans and Rupee Loan from Banks

During the earlier year, the Company, on March 2, 2009, allotted, 3,000, 11.20% Secured Redeemable, Non Convertible Debentures ("NCDs") of the face value of Rs. 1,00,00,000 each, aggregating to Rs. 3,000 crore to be redeemed at the end of 10th year from the date of allotment thereof. On February 7, 2012, the Company also allotted, 1,500, 11.25% and 5,000, 11.60% Secured Redeemable, Non Convertible Debentures ("NCDs") of the face value of Rs. 1,00,00,000 each and Rs. 10,00,000 each respectively, aggregating to Rs. 2,000 crore. Redemption of NCDs of Rs. 1,500 crore shall be in four annual equal installments starting at the end of fourth year from the date of allotment thereof and NCDs of Rs. 500 crore shall be redeemed at the end of 5th year from the date of allotment thereof.

Secured Redeemable, Non Convertible Debentures along with foreign currency loans and rupee loans ("the said secured loans") have been secured by first pari passu charge on the whole of the movable plant and machinery, of the Company including (without limitations) tower assets and optic fber cables, if any (whether attached or otherwise), Capital Work in Progress (pertaining to movable fixed assets) both present and future including all the rights, title, interest, benefits, claims and demands in respect of all insurance contracts relating thereto of the RCOM Group ("the Borrower Group"); comprising of the Company and its subsidiary companies namely; Reliance Telecom Limited (RTL), Reliance Infratel Limited (RITL) and Reliance Communications Infrastructure Limited (RCIL) in favour of the Security Trustee for the benefit of the NCD Holders and the Lenders of the said Secured Loans. The said loans (Refer Note 2.03.2 (b) (viii)) also include loan which are guaranteed. The Company, for the benefit of the Lenders of foreign currency loans, rupee loans of Rs.10 crore and 11.60%, 5,000 Secured Redeemable, Non Convertible Debentures aggregating to Rs. 500 crore has, apart from the above, also assigned 20 Telecom Licenses for services under Unifed Access Services (UAS), National Long Distance (NLD) and International Long Distance (ILD) by execution of Tripartite Agreements with Department of Telecommunications (DoT) and IDBI Bank, being the agent acting on their behalf.

Assignment of Telecom Licenses of the Company for 1,500, 11.25% Secured Redeemable, Non Convertible Debentures aggregating to Rs. 1,500 crore and Rupee Loan from Others of Rs. 300 crore are pending to be executed. The Company, for the benefit of the Lenders of foreign currency loans, rupee loan of Rs.10 crore, 11.20%, 3,000 Secured Redeemable, NCDs of the face value of Rs. 1,00,00,000 each aggregating to Rs. 3,000 crore and 11.60%, 5,000 Secured Redeemable, NCDs aggregating to Rs. 500 crore, has, apart from the above, also pledged equity shares held by the Company and Reliance Infocomm Infrastructure Private Limited in RCIL and RTL respectively by execution of the Share Pledge Agreement with the Share Pledge Security Trustee.

2.01.2 Cash Credit and Rupee Loans from Banks

Cash Credit from Bank is secured by first pari passu charge over current assets comprising of stock and receivables of the Company ("Current Assets"). Apart from this, Cash Credit from Bank as above are secured by second pari passu charge on whole of the movable plant and machinery, including (without limitation) the tower assets and optic fbre cables, if any (whether attached or otherwise), capital work in progress (pertaining to movable fixed assets) both present and future including all the rights, title, interest, benefits relating thereto of the Borrower Group ("Movable Fixed Assets of the Borrower Group").

The Company has been sanctioned Rupee Loans of Rs. 6,015 crore (Term Loan Facility) under consortium banking arrangement on the terms and conditions as set out in sanction letters. Certain Lenders have, pursuant to the sanction letters for Term Loan Facility, agreed to grant Rs. 4,590 crore as interim disbursement/short term loan (Interim Facility) of the Term Loan Facility, pending the finalization and execution of defnitive documents for converting in regular Term Loan Facility. The said Interim Facility, shall be converted in Long Term Loan within its tenure with availment of the Term Loan Facility upon execution of defnitive documents and accordingly, has been classifed as part of Short Term Borrowings. Interim Facility includes loans of Rs. 4,390 crore secured by First pari passu charge on Movable Fixed Assets of the Borrower Group. The Term Loan Facility is, inter alia, secured by first pari passu charge on Fixed Assets of the Borrower Group, including claims and demands in respect of all insurance contracts relating thereto. Apart from the above, the Term Loan Facility has also been secured by assignment of telecom licenses of the Company and pledge of equity shares held by the Company and Reliance Infocomm Infrastructure Private Limited in RCIL and RTL respectively. The Company has created first pari pasu charge on Fixed Assets of the Borrower Group for the said Interim Loans.The balance Rs. 525 crore of Interim / Short Term Loan is secured by second pari pasu charge on Movable Fixed Assets of Borrower Group.

In view of the confirmed profitable orders pursuant to agreement with the customer for sharing of infrastructure, which shall result into additional revenue and savings of cost, the Company has recognised Deferred Tax Assets of Rs. 1,488 crore as at 31st March, 2014. This will get further supported by decision of structuring of its business through various measures including schemes of merger and/ or demerger etc. so as to bring revenue and profit earned by the respective subsidiaries into the Company, subject to approvals, under applicable rules and regulations.

* During the Previous year, in absence of virtual certainity of realisability of deferred tax assets, the company on a conservative basis had restricted deferred tax asset to Nil.

Note : 2.2

Previous year

The financial statements has been prepared as per Revised Schedule VI under the Companies Act, 1956. Figures of the previous year have been regrouped and reclassified, wherever required. Amount in Finanacial Statements are presented in Rupee crore,except as otherwise stated.

Note : 2.3

Foreign Currency Monetary Items ; Long Term

In view of the option allowed pursuant to the notifcation dated December 29, 2011 issued by the Ministry of Corporate Affairs (MCA),Government of India, for the year ended on March 31, 2014, the Company has added Rs. 1432 crore (Previous year Rs. 888 crore) of exchange differences on long term borrowing relating to the acquisition of depreciable capital assets to the cost of capitalized assets. Further, the Company has accumulated foreign currency variations of Rs. 541 crore (Previous year Rs. 496 crore) arising on other long-term foreign currency monetary items in FCMITDA and Rs. 254 crore (Previous year Rs. 546 crore) has been amortised during the year, leaving balance which will be amortized over the balance period of loans.

During the previous year, in accordance with the notifcation issued by the Ministry of Corporate Affairs (MCA) on August 9, 2012, the Company had added Rs. 543 crore to the cost of capitalised assets and Rs. 232 crore to the FCMITDA by reversing the exchange difference regarded as an adjustment to interest cost on account of restating Long Term Monetary Items expressed in foreign currency at year end prevailing rates in accordance with para 4 (e) of Accounting Standared 16 "Borrowing Costs". The said interest was adjusted by withdrawal of an equivalent amount from General Reserve III during the previous year ended March 31, 2012 and hence, it has been credited to General Reserve III.

Note : 2.4

Schemes of Amalgamation and Arrangement of the earlier years

The Company, during the previous years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon''ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Notes to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs. 8,047 crore being Securities Premium Account, which was part of the Securities Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of Rs. 5,538 crore representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs. 2,785 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III of Rs. 14,193 crore comprises of Rs. 4,159 crore transferred to General Reserve from Statement of profit and Loss and Rs. 10,033 crore arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs. 1 crore of erstwhile Global Innovative Solutions Private Limited.

(v) The Company had, during the year ended on March 31, 2009, revalued its investments in one of its subsidiaries Reliance Globalcom BV, the Netherlands at then fair value, and credited an amount of Rs. 15,120 crore to General Reserve. On a conservative and prudent basis, and to refect the said investments at the present valuations, the Company has during the Previous year adjusted a sum of Rs. 10,880 crore in the General Reserve III.

(vi) Reserve for Business Restructuring of Rs. 1,287 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited, the Holding company of Reliance Infratel Limited after withdrawing an amount equivalent to writing off Passive Infrastructure assets, transferred to RITL, to the Statement of profit and Loss. Balance in Reserve for Business Restructuring shall be available to meet the increased depreciation, costs, expenses and losses including on account of impairment of or write down of assets etc.

(vii) Additional depreciation arising on fair value of the assets has been adjusted from General Reserve III and Provision for Business Restructuring.

(viii) Also refer note 2.37 "Exceptional Items" below.

Note : 2.5

Provisions

(i) Provisions include, provision for disputed claims of verifcation of customers Rs. 9 crore (Previous year Rs. 9 crore) and others of Rs. 1,206 crore (Previous year Rs. 1,206 crore) and reversal of disputed liabilities Rs. Nil (Previous year Rs. 147 crore).

The aforesaid provisions shall be utilised on settlement of the claims, if any, thereagainst.

(ii) Pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon''ble High Court of Judicature at Mumbai vide orders dated July 21, 2006 and August 10, 2006 (revised) and by Hon''ble High Court of Gujarat vide order dated July 18, 2006, out of the excess of fair value of assets over liabilities, Rs. 3,000 crore was credited to and held as Provision for Business Restructuring (PBR) to meet increased depreciation cost, expenses and losses including on account of impairment or write down of assets which would be suffered by the Company, pursuant to the Scheme or otherwise in course of its business or in carrying out such restructuring of the operations of the Company or its Subsidiaries. The Company has reassessed the requirement for maintaining such PBR and based thereon, reversed balance of Rs. 441 crore during the year as no longer required.The said amount on reversal of PBR has been refected as part of Other Income.

Note ; 2.6

Contingent Liabilities and Capital Commitment (as represented by the Management)

(Rs. in Crore)

As at As at March 31, 2014 March 31, 2013

(i) Estimated amount of contracts remaining to be executed on 282 199 capital accounts (net of advances) and not provided for

(ii) Disputed Liabilities in Appeal

- Sales Tax and VAT 22 23

- Excise and Service Tax 29 2

- Entry Tax and Octroi 34 32

- Income Tax 303 -

- Other Litigations 1,354 1,078

(iii) Guarantees given by the Company on behalf of its Subsidiaries 4,791 5,065

(iv) Guarantees given by the Company on behalf of other companies 12 3 for business purpose

(v) License Fees

The Hon''ble Supreme Court of India, vide its judgment dated October 11, 2011, has set aside the Order of Hon''ble Telecom Disputes Settlement and Appellate Tribunal (TDSAT) dated August 30, 2007 and allowed time to the licensees to raise their disputes before the Hon''ble TDSAT w.r.t. the demands already raised by Department of Telecommunications (DoT). The Hon''ble Supreme Court of India, in the meanwhile, also restrained DoT from enforcing its demands already raised. Subsequently, Hon''ble TDSAT granted all licensees/ operators the liberty to fle additional affdavits thereby bringing on record the material facts including the subsequent events with respect to the petitions already pending before Hon''ble TDSAT which got revived post AGR judgment of Hon''ble Supreme Court of India dated October 11, 2011. On April 12, 2012, all the petitions (both old and new of all the operators including the Company''s) were heard and interim order of protection, earlier passed by Hon''ble TDSAT was extended to the new petitions also. The matter is now pending for hearing before Hon''ble TDSAT and accordingly no additional provision is required in this regard.

(vi) Special Audit

Pursuant to the Telecom License Agreement, DoT directed audits of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company for the years ended March 31, 2007 and March 31, 2008 relating to license fees and revenue share. The Company has received show cause notices dated January 31, 2012 and subsequently received demand notice dated November 8, 2012 based on report of the Special Audit directed by DoT relating to alleged shortfall of license fees of Rs. 300 crore and interest thereon as applicable. The Company has challenged the said notices, inter alia demanding license fee on non telecom revenue based on Special Audit Report before the Hon''ble TDSAT and also before the Hon''ble High Court of Kerala. Both the Courts have stayed the operation of such impugned demand during the pendency of the Petitions before them. The Company is confdent that based on advice and, inter alia, on current understanding of the regulation by the industry and judicial pronouncements directly applicable to the issues raised in the special audit report, there shall not be any liability in this regard and hence, no provision is required in the accounts of the Company.

(vii) Spectrum Charges

Department of Telecommunication (DoT) has, during the previous year, issued demand on the Company for Rs. 1,758 crore towards levy of one time Spectrum Charges, being the prospective charges for holding CDMA Spectrum beyond 2.5 MHz for the period from January 1, 2013 till the expiry of the initial terms of the respective Licenses. Based on a petition fled by the Company, the Hon''ble High Court of Kolkata, vide its order dated April 19, 2013 stayed the operation of such impugned demand till further order. The Company is of the opinion that the said demand, inter alia, is an alteration of financial terms of the licenses issued in the past and has also been legally advised. Accordingly, no provision in this regard is required.

Note : 2.33 Operating Lease

The Company''s significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements. The Company is a lessee in respect of Optic Fibres and in respect of this lease, lease rent of Rs. 1,141 crore (Previous year Rs. 1,141 crore) including Rs. 760 crore (Previous year Rs. 1,129 crore) not leviable for the year as per the lease agreement, has been recognised on a straight line basis as Bandwidth Charges (Refer Note 2.22) Network Expenses and corresponding amount is provided for.

Note : 2.34

Export Commitments

The Company has obtained licenses/ authorisations under the Export Promotion Capital Goods (EPCG) Scheme for importing capital goods at a concessional rate of customs duty against submission of bonds. Under the terms of the respective licenses/ authorisations, the Company is required to export goods of FOB value equivalent to or more than, eight times the amount of duty saved in respect of such licenses/ authorisations, where export obligation has been refixed by the order of Director General Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, as applicable. The Company has fulfilled its export obligation under the aforesaid license as on March 31, 2014 and has submitted the necessary documents to DGFT for availing redemption letter for completion of export obligation amounting to Rs. 334 crore (Previous year Rs. 334 crore).

Note : 2.35

Segment Performance

Disclosure as per Accounting Standard ("AS") 17 "Segment Reporting" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of AS.

Note : 2.37

Exceptional Items

Pursuant to the direction of the Hon''ble High Court of Judicature of Mumbai and option exercised by the Board of the Company, in accordance with and as per the scheme of arrangement approved by the Hon''ble High Court vide order dated July 3, 2009 binding on the Company, expenses and/ or losses, identified by the Board of the Company as being exceptional or otherwise subject to the Accounting treatment prescribed in the Schemes of Arrangement sanctioned by the Hon''ble High Court and comprising of Rs. 333 crore (Previous year Rs. 218 crore) of depreciation consequent to addition of exchange differences on long term borrowing relating to capital assets to the cost of capitalised assets, as also Rs. 54 crore (Previous year Rs. 91 crore) of exchange variation (net), Rs. 254 crore (Previous year Rs. 546 crore) being amortization of Foreign Currency Monetary Items Difference Account (FCMITDA) excluding the portion added to the cost of fixed assets or carried forward as FCMITDA in accordance with Para 46A inserted in to Accounting Standard (AS) 11 "The Effect of Changes in Foreign Exchange Rates" in the context of unprecedented volatility in exchange rate during the year, have been met by withdrawal from corresponding General Reserves, leaving no impact on profit for the year ended March 31, 2014. Such withdrawals have been included/ refected in the Statement of profit and Loss. While the Company has been legally advised that such inclusion in the Statement of profit and Loss is in accordance with Revised Schedule VI of the Companies Act, 1956, the Company has also sought clarifcation from ICAI that such inclusion in the Statement of profit and Loss is not contrary to Revised Schedule VI. Had such write off of expenses and losses not been met from General Reserve, the Company would have refected a profit/(Loss) after tax for the year of Rs. 89 crore (Previous year (Rs. 231 crore)) and the consequential effect of this on the profit after tax for the year would have been of Rs. 641 crore (Previous year Rs. 855 crore).

Note : 2.38

Recovery of Expenses

Expenses under the heads Provision for Employee Costs and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company. Such amounts recovered for the year amounting to Rs. 51 crore (Previous year Rs. 104 crore) for Salaries, Rs. 133 crore (Previous year Rs. 235 crore) for Sales and General and Administration Expenses comprising of Rs. 42 crore (Previous year Rs. 36 crore) for Advertising Expenses, Rs. 91 crore (Previous year Rs. 171 crore) for Customer Acquisition, Commission, Billing and Collection, Webstore expenses, Customer Care and Other General Expenses, Rs. 10 crore (Previous year Rs. 28 crore) for Hire Charges, Rs. 196 crore (Previous year Rs. 246 crore) for Network Expenses and Rs. 371 crore (Previous year Rs. Nil) for Interest Expenses.

Apart from the above, the expenses are net of recoveries from:

Reliance IDC Limited, a Wholly Owned Subsidiary of Reliance Communications Infrastructure Limited, includes Rs. 3 crore (Previous year Rs. 16 crore) for Hire charges, Rs. 21 crore (Previous year Rs. Nil) for Salary, Rs. 1 crore (Previous year Rs. Nil) for Other General and Administration Expenses and Rs. 14 (Previous year Rs. Nil) crore for Interest Expense.

Reliance Infratel Limited, a subsidiary of Reliance Communications Infrastructure Limited for the year includes Rs. 52 crore (Previous year Rs. 67 crore) for Salaries and Rs. 28 crore (Previous year Rs. 45 crore) for Sales and General and Administration Expenses comprising of, Rs. 7 crore (Previous year Rs. 25 crore) for Hire Charges and Rs. 21 crore (Previous year Rs. 20 crore) for Other General and Administration Expenses.

Reliance Big TV Limited, a Wholly Owned Subsidiary of the Company includes Rs. 5 crore (Previous year Rs. 3 crore) for Other General and Administration Expenses include hire charges, Rs. 15 crore (Previous year Rs. 16 crore) for Salaries and Rs. 93 crore (Previous year Rs. Nil) for Interest Expenses.

Reliance Telecom Limited, a Subsidiary of the Company includes Rs. 101 crore (Previous year Rs. 83 crore) for Salary, Rs. 19 crores (Previous year Rs. 29 crore) for Advertisement and Marketing Expenses, Rs. 94 crore (Previous year Rs. 90 crore) for Sales and General and Administration Expenses, Rs. 10 crore towards Network Expenses (Previous year Rs. 14 crore) and Rs. 199 crore (Previous year Rs. Nil) for Interest Expenses.

Reliance Tech Services Private Limited, a Wholly Owned Subsidiary of the Company includes Rs. 12 crore (Previous year Rs. 7 crore) for Salary and Rs. 12 crore (Previous year Rs. 12 crore) for Other General and Administration Expenses including Hire Charges.

Reliance Webstore Limited, a Wholly Owned Subsidiary of the Company includes Rs. 21 crore (Previous year Rs. 16 crore) for Salary, Rs. 67 crore (Previous year Rs. 56 crore) for Sales and General and Administration Expenses comprising of Rs. 5 crore (Previous year Rs. 4 crore) for Hire Charges, Rs. 61 crore (Previous year Rs. 52 crore) for Selling and Marketing expenses and Rs. 1 crore (Previous year Rs. Nil) for Other General and Administration Expenses and Rs. 55 crore (Previous year Rs. Nil) for Interest Expense.

Reliance Infocomm Infrastructure Private Limited, a Wholly Owned Subsidiary of the Company includes Rs. 34,48,272 (Previous year Rs. 8,32,121) for Salary, General and Administration Expenses and Rs. 27 crore (Previous year Rs. Nil) for Interest Expense.

Finance cost is net of recovery of interest cost from respective subsidiaries as mentioned above for the fund used by them for their business.

Network expenses are net of remission of charges of Rs. 618 crore (Previous year Rs. 461 crore) for the defciency in Passive Infrastructure Services by RITL, a subsidiary of the RCIL, pursuant to the Service Level Agreement between the parties.

Note : 2.39

Financial Statements of Subsidiary Companies

The Ministry of Corporate Affairs, Government of India vide its General circular no. 2 and 3, dated February 8, 2011 and February 21, 2011 respectively, has granted general exemption from compliance with Section 212 of the Companies Act, 1956, subject to fulfllment of conditions stipulated in the circular. The Company has satisfed the conditions stipulated in the circular and hence, is entitled to the exemption. As per the circular, key details of each subsidiary is attached in the Consolidated Financial Statements.

Note: 2.40

Employee benefits

Gratuity : In accordance with the applicable Indian laws, the Company provides for the gratuity, a Defined benefit retirement plan (Gratuity Plan) for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employee''s last drawn salary and for the years of employment with the Company.

The following table sets out the status of the Gratuity Plan as required under Accounting Standard ("AS") 15 (Revised) "Employee benefits".

Provident Fund : The guidance on Implementing ("AS") 15 "Employee benefits" (revised 2005) issued by the ICAI states that the benefits involving employer established Provident Fund, which require interest shortfalls recompensed are to be considered as/ in Defined benefit plans. The employee and employer each make monthly contribution to the plan equal to 12% of the covered employee''s salary. Contributions are made to the trust established by the Company. During the year ended March 31, 2012, the Actuarial Society of India issued the final guidance for measurement of provident fund liabilities. As at March 31, 2014, based on the actuarial valuation, Fair value of plan assets is Rs. 283 crore (Previous year Rs. 296 crore), the present value of Defined benefit obligation is Rs. 283 crore (Previous year Rs. 296 crore). For the year ended March 31, 2014, the Company has contributed Rs. 17 crore (Previous period Rs. 20 crore) towards Provident Fund.

The assumptions made for the above are Discount rate of 9.25%, average remaining tenure of Investment Portfolio is 6 years and guaranteed rate of return is 8.75%.

Note : 2.41

Disclosure under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from October 2, 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the company, the following disclosures are made for the amounts due to Micro and Small Enterprises.

Note : 2.43

Employee Stock Option Schemes

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the Option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted one Equity Share of the Company of Rs. 5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs. 387 crore (Previous year Rs. 387 crore) had been granted to the Trust and the said amount had been utilized by the Trust for purchasing 2.13 crore (Previous year 2.13 crore) Equity Shares during the period upto March 31, 2014. (Refer Note 2.01 (5)).

Amortization of compensation includes write back of Rs. 1 crore (Previous year Rs. 2 crore) based on intrinsic value of Options which has been vested under ESOS Plan 2008 and refected in Statement of profit and Loss under Employees benefits Expenses. No amount is chargeable in respect of Options granted under ESOS Plan 2009.

No derivative instruments are acquired for speculation purpose.

In respect of Foreign Currency Swap and Interest Rate Swap transactions, which are linked with LIBOR rates and exchange rate during the period of contract, gains/ losses, if any, are recognised on the settlement day or the reporting day, whichever is earlier, at the rate prevailing on respective day.

Foreign Currency exposures that are not hedged by derivative instruments or otherwise for Loans and Liabilities and assets are $ 333 crore (Previous year $ 383 crore), equivalent to Rs. 19,934 crore (Previous year Rs. 20,762 crore).

Above exposure status does not include the effects of accruals.

The unamortized premium of Buyers'' Credit to be recognized is Rs. 4 crore (Previous year Rs. 2 crore) for one or more subsequent accounting periods.

Note : 2.45

Related Parties

As per Accounting Standard ("AS") 18, ''Related Party Disclosures, prescribed under the Accounting Standard Rules, the disclosures of transactions with the related parties are given below.

A List of Related Parties : where control exists

Sr. Name of the Subsidiary Companies

No. (direct and step down subsidiaries)

1 Reliance WiMax Limited

2 Reliance Digital Home Services Limited

3 Reliance Webstore Limited

4 Reliance Infocomm Infrastructure Private Limited

5 Campion Properties Limited

6 Reliance Big TV Limited

7 Reliance Tech Services Private Limited

8 Reliance Telecom Limited

9 Reliance Communications Infrastructure Limited

10 Reliance IDC Limited (previously Reliance Communication Investment and Leasing Limited)

11 Reliance Infratel Limited

12 Reliance Mobile Commerce Limited

13 Reliance BPO Private Limited

14 Reliance Globalcom Limited

15 Reliance Communications Tamil Nadu Private Limited (w.e.f. November 15, 2013)

16 M. P. Network Private Limited (upto February 10, 2014)

17 Kerala Communications Private Limited (upto February 10, 2014)

18 Reliance Globalcom B.V.

19 Reliance Communications (UK) Limited

20 Reliance Communications (Hong Kong) Limited

21 Reliance Communications (Singapore) Pte. Limited

22 Reliance Communications (New Zealand) Pte Limited

23 Reliance Communications (Australia) Pty Limited

24 Anupam Global Soft (U) Limited

25 Gateway Net Trading Pte Limited

26 Reliance Globalcom Limited, Bermuda

27 FLAG Telecom Singapore Pte. Limited

28 FLAG Atlantic UK Limited

29 Reliance FLAG Atlantic France SAS

30 FLAG Telecom Taiwan Limited

31 Reliance FLAG Pacifc Holdings Limited

32 FLAG Telecom Group Services Limited

33 FLAG Telecom Deutschland GmbH

34 FLAG Telecom Hellas AE

35 FLAG Telecom Asia Limited

36 FLAG Telecom Nederland B.V.

37 Reliance Globalcom (UK) Limited

38 Yipes Holdings Inc.

39 Reliance Globalcom Services Inc.

40 YTV Inc.

41 Reliance Infocom Inc.

42 Reliance Communications Inc.

43 Reliance Communications International Inc.

44 Reliance Communications Canada Inc.

45 Bonn Investment Inc.

46 FLAG Telecom Development Limited

47 FLAG Telecom Development Services Company LLC

48 FLAG Telecom Network Services Limited

49 Reliance FLAG Telecom Ireland Limited

50 FLAG Telecom Japan Limited

51 FLAG Telecom Ireland Network Limited

52 FLAG Telecom Network USA Limited

53 FLAG Telecom Espana Network SAU

54 Reliance Vanco Group Ltd

55 Euronet Spain SA

56 Vanco (Shanghai) Co Ltd.

57 Vanco (Asia Pacifc) Pte. Ltd.

58 Vanco Australasia Pty. Ltd.

59 Vanco Sp Zoo

60 Vanco Gmbh

61 Vanco Japan KK

62 Vanco NV

63 Vanco SAS

64 Vanco South America Ltda

65 Vanco Srl

66 Vanco Sweden AB

67 Vanco Switzerland AG

68 Vanco Deutschland GmbH

69 Vanco BV

70 Vanco Benelux BV

71 Vanco UK Ltd

72 Vanco International Ltd

73 Vanco Row Limited

74 Vanco Global Ltd

75 VNO Direct Ltd

76 Vanco US LLC

77 Vanco Solutions Inc

78 Net Direct SA (Properietary) Ltd.

79 GCX Limited (w.e.f March 26, 2014)

80 Global Cloud Xchange Limited (w.e.f March 26, 2014)

81 Seoul Telenet Inc.

82 FLAG Holdings (Taiwan) Limited

83 Reliance Telecom Infrastructure (Cyprus) Holdings Limited

84 Lagerwood Investments Limited

85 Vanco EpE (Upto April 1, 2013)

86 Reliance Innoventures Private Limited

Individuals Promoters

87 Shri Anil D. Ambani, the person having control during the year

Key Managerial Person

88 Shri Prakash Shenoy, Company Secretary and Manager

B List of Other Related Parties : where there have been transactions Associates

1 Warf Telecom International Private Limited

2 Mumbai Metro Transport Private Limited

Fellow Subsidiaries

3 AAA Communication Private Limited

4 AAA Industries Private Limited

5 ADA Enterprises and Ventures Private Limited

6 Reliance Capital Limited

7 Reliance General Insurance Company Limited

Disclosure in respect of transactions, which are more than 10% of the total transactions of the same type with a related party during year ended March 31, 2014.

1. Fixed assets acquired during the period include Rs. 108 crore from Reliance Tech Services Private Limited. (Previous year - Fixed assets acquired during the year include Rs. 100 crore from Reliance Tech Services Private Limited).

2. Loans and Advances include loans granted during the year of Rs. 3,994 crore to Reliance Communications Infrastructure Limited, Rs. 3,145 crore to Reliance Telecom Limited and repaid /adjusted during the year Rs. 4,765 crore by Reliance Communications Infrastructure Limited, Rs. 3,214 crore by Reliance Telecom Limited. (Previous year - Loans and Advances include loan granted during the year of Rs. 4,256 crore to Reliance Communications Infrastructure Limited, Rs. 1,879 crore to Reliance Telecom Limited and repaid /adjusted during the year Rs. 4,096 crore by Reliance Communications Infrastructure Limited, Rs. 2,066 crore by Reliance Telecom Limited).

3. Trade Receivables include Rs. 460 crore from Reliance Communications Infrastructure Limited, Rs. 337 crore from Reliance Telecom Limited and Rs. 23 crore from Reliance Webstore Limited. (Previous year Â Trade Receivables include Rs. 724 crore from Reliance Communications Infrastructure Limited, Rs. 108 crore from Reliance Telecom Limited and Rs. 4 crore from Reliance Webstore Limited).

4. Loans include Rs. 1,216 crore to Reliance Communications Infrastructure Limited, Rs. 1,581 crore to Reliance Telecom Limited and Rs. 2,719 crore to Reliance Infratel Limited and Advances include Rs. 2,086 crore to Reliance Communications Infrastructure Limited, Rs. 8 crore to Reliance Telecom Limited and Rs. 273 crore to Reliance Infratel Limited. (Previous year - Loans include Rs. 1,987 crore to Reliance Communications Infrastructure Limited, Rs. 1,651 crore to Reliance Telecom Limited and Rs. 2,719 crore to Reliance Infratel Limited and Advances include Rs. 1,364 crore to Reliance Communications Infrastructure Limited, Rs. 134 crore to Reliance Telecom Limited and Rs. Nil to Reliance Infratel Limited).

5. Trade Payables include Rs. 63 crore to Reliance Flag Atlantic France SAS, Rs. 58 crore to Reliance Communications Inc, Rs. 239 crore to Reliance Webstore Limited, Rs. Nil to Reliance Infratel Limited, Rs. 108 crore to Reliance Communication (UK) Limited and Rs. 9 crore to Reliance Tech Services Private Limited. (Previous year Â Trade Payables include Rs. 116 crore to Reliance Flag Atlantic France SAS, Rs. 425 crore to Reliance Communications Inc, Rs. 130 crore to Reliance Webstore Limited, Rs. 101 crore to Reliance Infratel Limited, Rs. 81 crore to Reliance Communication (UK) Limited and Rs. Nil to Reliance Tech Services Private Limited).

6. Revenue from Operations includes Rs. 382 crore from Reliance Communications Infrastructure Limited, Rs. 620 crore from Reliance Communications Inc. and Rs. 702 crore from Reliance Telecom Limited. (Previous year - Revenue from Operations includes Rs. 1,234 crore from Reliance Communications Infrastructure Limited, Rs. 671 crore from Reliance Communications Inc. and Rs. 750 crore from Reliance Telecom Limited).

7. Expenditure includes Access Charges: Rs. 195 crore to Reliance Communications Inc.and Rs. 277 crore to Reliance Telecom Limited, Network Operation Expenses: Rs. 2,359 crore to Reliance Infratel Limited, Selling and Marketing expenses: Rs. 45 crore to Reliance Webstore Limited and Rs. 131 crore to Reliance Communications Infrastructure Limited, General and Administration Expenses: Rs. 14 crore to Reliance Communications Infrastructure Limited, Rs. 11 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 86 crore to Reliance IDC Limited and Rs. 32 crore to Reliance Tech Services Private Limited and Finance Cost Rs. 14 crore to Reliance Communications Infrastructure Limited (Previous year - Expenditure includes Access Charges: Rs. 214 crore to Reliance Communications Inc.and Rs. 281 crore to Reliance Telecom Limited, Network Operation Expenses: Rs. 1,570 crore to Reliance Infratel Limited, Selling and Marketing expenses: Rs. 43 crore to Reliance Webstore Limited and Rs. 115 crore to Reliance Communications Infrastructure Limited, General and Administration Expenses: Rs. 37 crore to Reliance Communications Infrastructure Limited, Rs. 24 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 70 crore to Reliance IDC Limited, and Rs. 10 crore to Reliance Tech Services Private Limited) and Finance Cost Rs. 15 crore to Reliance Communications Infrastructure Limited).

8. Corporate Guarantee issued includes Rs. 2,476 crore to Reliance Infratel Limited and Rs. 1,810 crore to Reliance Telecom Limited. Assurance/ Letter of comfort which are not in nature of guarantee for financial support to subsidiaries. (Previous year - Corporate Guarantee issued includes Rs. 2,949 crore to Reliance Infratel Limited and Rs. 1,436 crore to Reliance Telecom Limited).

9. Interest Income include Rs. 595 crore receivable from Reliance Infratel Limited. (Previous year - Interest Income includes Rs. 595 crore received from Reliance Infratel Limited).

10. Other Current Assets include Rs. 31 crore of Unbilled revenue of Reliance Communications Inc. Interest Receivable includes Rs. 408 crore from Reliance Infratel Limited, Rs. 199 crore from Reliance Telecom Limited and Rs. 371 crore from Reliance Communications Infrastructure Limited. (Previous year - Other Current Assets include Rs. 51 crore of Unbilled revenue of Reliance Communications Inc. Interest Receivable includes Rs. 482 crore from Reliance Infratel Limited, Rs. Nil from Reliance Telecom Limited and Rs. Nil from Reliance Communications Infrastructure Limited).

11. Interest Accrued on Investment includes Rs. 1,359 crore of Dividend Yield on Preference Share from Reliance Infratel Limited. (Previous year Â Interest Accrued on Investment include Rs. 1,005 crore of Dividend Yield on Preference Share from Reliance Infratel Limited).

12. Unearned Income includes Rs. 14 crore from Flag Telecom Ireland Network Limited (Previous Year- Unearned Income includes Rs. 20 crore from Flag Telecom Ireland Network Limited).

13. Prepaid expenses include Rs. Nil from Reliance Telecom Limited and Rs. 25 crore from Reliance FLAG Atlantic France SAS. (Previous year-Prepaid expenses include Rs. 15 crore from Reliance Telecom Limited and Rs. 9 crore from Reliance FLAG Atlantic France SAS).

14. Refer Note 2.38 for Recovery of Expenses and Interest cost from subsidiaries.

15 Dividend paid, during the Previous year of Rs. 30,94,750 to Reliance Innoventures Private Limited, Rs. 18 crore to AAA Communication Private Limted, Rs. 8 crore to AAA Industries Private Limited, Rs. 8 crore ADA Enterprises and Ventures Private Limited and Rs. 1 crore to Reliance Capital Limited.

16. Other Current Liability includes Advance from customer Rs. 106 crore of Reliance Communications Inc and Rs. 170 crore of Reliance Telecom Limited. Other Current Liability also includes Rs. 217 crore to Reliance Infratel Limited for availing passive infrastructure services for 3G operations.(Previous year Â Other Current Liability includes Advance from customer Rs. 99 crore of Reliance Communications Inc and Other Current Liability Rs. Nil of Reliance Telecom Limited. Other Current Liability also includes Rs. 217 crore to Reliance Infratel Limited for availing passive infrastructure services for 3G operations).

Mar 31, 2013

Note : 1.01 (Note 2.25 of Annual Accounts)

Previous year

The financial statements has been prepared as per Revised Schedule VI under the Companies Act, 1956. Figures of the previous year have been regrouped and reclassified, wherever required. Amount in abridged financial statements are presented in Rupee crore, except as otherwise stated.

Note : 1.02 (Note 2.26 of Annual Accounts)

Foreign Currency Monetary Items; Long Term

In view of the option allowed pursuant to the notification dated December 29, 2011 issued by the Ministry of Corporate Affairs (MCA) Government of India, for the year ended on March 31, 201 3, the Company has added Rs. 888 crore (Previous year Rs. 1,499 crore) including Rs. Nil (Previous year Rs. 1 63 crore) regarded as an adjustment to interest cost on account of restating long term monetary items expressed in foreign currency at year end prevailing rates, of exchange differences on long term borrowing relating to the acquisition of depreciable capital assets to the cost of capitalized assets. Further, the Company has accumulated foreign currency variations of Rs. 496 crore (Previous year Rs. 31 5 crore) arising on other long term foreign currency monetary items in FCMITDA and Rs. 546 crore (Previous year Rs. 1 6 crore) has been amortised during the year, leaving balance which will be amortized over the balance period of loans.

In accordance with the notification issued by the Ministry of Corporate Affairs (MCA) on August 9, 201 2, the Company has during the year, added Rs. 543 crore to the cost of capitalised assets and Rs. 232 crore to the FCMITDA by reversing the exchange difference regarded as an adjustment to interest cost on account of restating Long Term Monetary Items expressed in foreign currency at year end prevailing rates in accordance with para 4 (e) of Accounting Standared 1 6 "Borrowing Costs". The said interest was adjusted by withdrawal of an equivalent amount from General Reserve III during the previous year ended March 31, 2012 and hence, it has been credited to General Reserve III.

Note : 1.03 (Note 2.27 of Annual Accounts)

Schemes of Amalgamation and Arrangement of the earlier years

The Company, during the previous years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1 956 approved by the Hon''ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. Reserves, pursuant to the said Schemes, include:

(i) Rs. 8,047 crore, being Securities Premium Account, which was part of the Security Premium of erstwhile Reliance Infocomm Limited, the transferor company.

(ii) General Reserve I of Rs. 5,538 crore representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs. 2,785 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III of Rs. 26,330 crore comprises of Rs. 4,1 59 crore transferred to General Reserve from Statement of Profit and Loss and Rs. 22,1 70 crore arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs. 1 crore of erstwhile Global Innovative Solutions Private Limited.

(v) Reserve for Business Restructuring of Rs. 1,287 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited, the Holding company of Reliance Infratel Limited (RITL) after withdrawing an amount equivalent to writing off Passive Infrastructure assets, transferred to RITL, to the Statement of Profit and Loss. Balance in Reserve for Business Restructuring shall be available to meet the increased depreciation, costs, expenses and losses including on account of impairment of or write down of assets etc,

(vi) Additional depreciation arising on fair value of the assets has been adjusted from General Reserve III and Provision for Business Restructuring.

(vii) The Company had, during the year ended on March 31, 2009, revalued its investments in one of its subsidiaries Reliance Globalcom BV, the Netherlands at then fair value, and credited an amount of Rs. 15,120 crore to General Reserve. On a conservative and prudent basis, and to reflect the said investments at the present valuations, the Company has during the year adjusted a sum of Rs. 10,880 crore in the General Reserve III.

(viii) Premium of Rs. 357 crore paid on redemption of the FCCBs had been charged to Securities Premium Account during the previous year.

(ix) Pursuant to the Scheme of Amalgamation of Reliance Gateway Net Limited (RGNL), on account of the fair valuation, during an earlier year ended on March 31, 2009, opening gross block of fixed assets included increase in Freehold Land by Rs. 225 crore, Buildings by Rs. 1 30 crore and Telecom Licenses by Rs. 14,145 crore.

(x) Also refer note 2,11 "Exceptional Items" below.

Note : 1.04 (Note 2.29 of Annual Accounts)

Provisions

(i) Provisions include, provision for disputed claims of verification of customers Rs. 9 crore (Previous yearRs. 9 crore), others ofRs. 1,206 crore (Previous year Rs. 1,353 crore) and reversal of disputed liabilities of Rs. 147 crore (Previous year Rs. 46 crore).

The aforesaid provisions shall be utilised on settlement of the claims, if any, there against.

(ii) Pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1 956 approved by the Hon''ble High Court of Judicature at Mumbai vide orders dated July 21, 2006 and August 1 0, 2006 (revised) and by Hon''ble High Court of Gujarat vide order dated July 18, 2006, out of the excess of fair value of assets over liabilities, Rs. 3,000 crore was credited to and held as Provision for Business Restructuring (PBR) to meet increased depreciation cost, expenses and losses including on account of impairment or write down of assets which would be suffered by the Company, pursuant to the Scheme or otherwise in course of its business or in carrying out such restructuring of the operations of the Company or its Subsidiaries. The Company has reassessed the requirement for maintaining such PBR and based thereon, reversed Rs. 550 crore during the year as no longer required leaving balance of Rs. 488 crore for being dealt with in accordance with the said Scheme. The said amount on reversal of PBR has been reflected as part of Other Income.

Note : 1.05 (Note 2.30 of Annual Accounts)

Contingent Liabilities and Capital Commitment (as represented by the Management)

(Rs. in Crore)

As at As at March 31. 2013 March 31, 2012

(i) Estimated amount of contracts remaining to be executed on capital accounts and 199 294 not provided for

(ii) Disputed Liabilities in Appeal

- Sales Tax and VAT 23 18

- Excise and Service Tax 2 2

- Entry Tax and Octroi 32 28

- Other Litigations 1,078 373

(iii) Guarantees given by the Company on behalf of its Subsidiaries 5,065 5,472

(iv) Guarantees given by the Company on behalf of other companies for business purpose 3 51

(v) License Fees

The Hon''ble Supreme Court of India, vide its judgment dated October 11, 2011, has set aside the Order of the Hon''ble Telecom Disputes Settlement and Appellate Tribunal (TDSAT) dated August 30, 2007 and allowed time to the licensees to raise their disputes before the Hon''ble TDSAT w.r.t. the demands already raised by Department of Telecommunications (DoT). The Hon''ble Supreme Court of India, in the meanwhile, also restrained DoT from enforcing its demands already raised. Subsequently, Hon''ble TDSAT granted all licensees/ operators the liberty to file additional affidavits thereby bringing on record the material facts including the subsequent events with respect to the petitions already pending before Hon''ble TDSAT which got revived post AGR judgment of Hon''ble Supreme Court of India dated October 11, 2011. On April 12, 201 2, all the petitions (both old and new of all the operators including the Company''s) were heard and interim order of protection, earlier passed by Hon''ble TDSAT were also extended to the new AGR petitions. The matter is now pending before Hon''ble TDSAT. Accordingly no additional provision is required in this regard.

(vi) Access Deficit Charges (ADC)

The Hon''ble TDSAT and Hon''ble Supreme Court of India vide its judgment dated January 17, 2006 and April 30, 2008 respectively upheld the circular of the Bharat Sanchar Nigam Limited (BSNL) dated January 14, 2005 whereby and where under the Company''s Fixed Wireless Phone (FWP) service was declared as limited mobile service. The period of claim, which was raised before the Hon''ble Supreme Court of India was for the period from November 14, 2004 to August 26, 2005. As directed by the Hon''ble Supreme Court on April 30, 2008, the Company moved before the Hon''ble TDSAT for quantification of ADC for aforesaid period. The Hon''ble TDSAT vide its judgment dated April 17, 2012 confirmed the liability of the Company for the said period and for subsequent periods. The Company already has an adequate provision of Rs. 540 crore in the books for the liability which is determined to be payable. Further course of action including the financial impact, if any, for the balance amount, which is under dispute and shall be determined on completion of reconciliation with BSNL.

(vii) Special Audit

Pursuant to the Telecom License Agreement, DoT directed audit of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company for the years ended March 31, 2007 and March 31, 2008 relating to license fees and revenue share. The Company has received show cause notices dated January 31, 2012 and subsequently received demand notice dated November 8, 2012 based on report of the Special Audit directed by DoT relating to alleged shortfall of license fees of Rs. 300 crore and interest thereon as applicable. The Company has challenged the said notices, inter alia demanding license fee on non telecom revenue based on Special Audit Report before the Hon''ble TDSAT and also before the Hon''ble High Court of Kerala. Both the Courts have stayed the operation of such impugned demand during the pendency of the Petitions before them. The Company is confident that based on advice and, inter alia, on current understanding of the regulation by the industry and judicial pronouncements directly applicable to the issues raised in the special audit report, there shall not be any liability in this regard and hence, no provision is required in the accounts of the Company.

(viii) Spectrum Charges

Department of Telecommunication (DoT) has, during the year, issued demand on the Company for Rs. 1,758 crore towards levy of one time Spectrum Charges, being the prospective charges for holding CDMA Spectrum beyond 2.5 MHz for the period from January 1, 201 3 till the expiry of the initial terms of the Licenses. Based on a petition filed by the Company, the Hon''ble High Court of Kolkata, vide its order dated April 1 9, 201 3, has stayed the operation of the impugned demand till further order. The Company is of the opinion that the said demand, inter alia, is an alteration of financial terms of the licenses issued in the past and has also been legally advised! Accordingly, no provision in this regard is required.

Note : 1.06 (Note 2.32 of Annual Accounts)

Operating Lease

The Company''s significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements. The Company is a lessee in respect of Optic Fibers and in respect of this lease, lease rent of Rs. 1,141 crore (Previous year Rs. 1,1 41 crore) including Rs. 1,129 crore (Previous year Rs. 1,1 29 crore) not leviable for the year as per the lease agreement, has been recognised on a straight line basis as Network Expenses and corresponding amount is provided for.

Note : 1.07 (Note 2.34 of Annual Accounts)

Export Commitments

The Company has obtained licenses/ authorisations under the Export Promotion Capital Goods (EPCG) Scheme for importing capital goods at a concessional rate of customs duty against submission of bonds. Linder the terms of the respective licenses/ authorisations, the Company is required to export goods of FOB value equivalent to or more than, eight times the amount of duty saved in respect of such licenses/ authorisations, where export obligation has been refixed by the order of Director General Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, as applicable. The Company has fulfilled its export obligation under the aforesaid license as on March 31, 2013 and has submitted the necessary documents to DGFT for availing redemption letter for completion of export obligation amounting to Rs. 334 crore (Previous year Rs. 334 crore).

Note : 1.08 (Note 2.35 of Annual Accounts)

Segment Performance

Disclosure as per Accounting Standard ("AS") 1 7 "Segment Reporting" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of AS.

Note : 1.09 (Note 2.37 of Annual Accounts)

Exceptional Items

Pursuant to the direction of the Hon''ble High Court of Judicature of Mumbai and option exercised by the Board of the Company, in accordance with and as per the scheme of arrangement approved by the Hon''ble High Court vide order dated July 3, 2009 binding on the Company, expenses and/ or losses, identified by the Board of the Company as being exceptional or otherwise subject to the Accounting treatment prescribed in the Schemes of Arrangement sanctioned by the Hon''ble High Court and comprising of Rs. Nil (Previous year Rs. 268 crore) of debts due and subsidy claimed from the Government, Rs. Nil (Previous year Rs. 775 crore) regarded as an adjustment to interest cost, on account of restating Long Term Monetary Items expressed in foreign currency at year end prevailing rates, Rs. 218 crore (Previous year Rs. Nil) of depreciation consequent to addition of exchange differences on long term borrowing relating to capital assets to the cost of capitalised assets, as also Rs. 91 crore (Previous year Rs. 273 crore) of net losses on settlement of items recovered and/ or discharged in foreign currency, Rs. 546 crore (Previous year Rs. 1 6 crore) (Refer Note 2.02) being amortization of Foreign Currency Monetary Items Translation Difference Account (FCMITDA) excluding the portion added to the cost of fixed assets or carried forward as FCMITDA in accordance with Para 46 A inserted into Accounting Standard (AS) 11 "The Effects of Changes in Foreign Exchange Rates" in context of unprecedented volatility in exchange rates during the year, have been met by withdrawal from corresponding General Reserves, leaving no impact on profit for the year ended March 31, 201 3. Such withdrawals have been included/ reflected in the Statement of Profit and Loss. While the Company has been legally advised that such inclusion in the Statement of Profit and Loss is in accordance with Revised Schedule VI of the Companies Act, 1 956, the Company has also sought clarification from the ICAI that such inclusion in the Statement of Profit and Loss is not contrary to Revised Schedule VI. Had such write off of expenses and losses not been met from General Reserve, the Company would have reflected a loss after tax for the year of Rs. 231 crore (Previous year Rs. 1,1 76 crore) and the consequential effect of this on the profit after tax for the year would have been of Rs. 855 crore (Previous year Rs. 1,332 crore).

Note : 1.10 (Note 2.38 of Annual Accounts)

Recovery of Expenses

Expenses under the heads Provision for Employee Costs and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company. Such amounts recovered for the year amounting toRs. 104 crore (Previous year Rs. 84 crore) for Salaries, Rs. 235 crore (Previous year Rs. 409 crore) for Sales and General Administration Expenses comprising of Rs. 36 crore (Previous year Rs. 46 crore) for Advertising Expenses, Rs. 1 71 crore (Previous year Rs. 305 crore) for Customer Acquisition, Commission, Billing and Collection, Webstore expenses and Customer Care, Rs. 28 crore (Previous yearRs. 58 crore) for Hire Charges and Rs. 246 crore (Previous yearRs. Nil) for Network Expenses. Similarly, the amount recovered from Reliance Infratel Limited, a subsidiary of Reliance Communications Infrastructure Limited for the year includes Rs. 67 crore (Previous year Rs. 26 crore) for Salaries and Rs. 45 crore (Previous year Rs. 67 crore) for Sales and General Administration Expenses comprising of, Rs. 25 crore (Previous year Rs. 22 crore) for Hire Charges and Rs. 20 crore for Other General Administration Expenses (Previous year Rs. 45 crore). Similarly, the amount recovered from Reliance Big TV Limited, a Wholly Owned Subsidiary of the Company includes Rs. 3 crore (Previous year Rs. 4 crore) for Hire Charges and Rs. 1 6 crore (Previous year Rs. 26 crore) for Salaries. Similarly, the amount recovered from Reliance Telecom Limited, a Subsidiary of the Company includes Rs. 83 crore (Previous year Rs. 93 crore) for Salary, Rs. 29 crores (Previous year Rs. 14 crore) for Advertisement and marketing expenses, Rs. 90 crore (Previous year Rs. 111 crore) for General Administration Expenses and Rs. 1 4 crore towards Network Charges (Previous year Rs. 7 crore). Similarly, the amount recovered from Reliance Tech Services Private Limited, a Subsidiary of the Company includes Rs. 7 crore (Previous year Rs. Nil) for Salary and Rs. 12 crore (Previous year Rs. Nil) for Hire Charges. Similarly, the amount recovered from Reliance Webstore Limited (RWSL), a Wholly Owned Subsidiary of the Company includes Rs. 1 6 crore (Previous year Rs. Nil) for Salary and Rs. 56 crore (Previous year Rs. Nil) for Sales and General Administrative Expenses comprising of Rs. 4 crore (Previous year Rs. Nil) for Hire Charges, Rs. 10 crore (Previous year Rs. Nil) for Advertisement expenses, Rs. 24 crore (Previous year Rs. Nil) for Commission Expenses and Rs. 18 crore for Selling and Marketing expenses. Similarly, the amount recovered from Reliance Infocomm Infrastructure Private Limited, a Wholly Owned Subsidiary of the Company includes Rs. 8,32,1 21 (Previous year Rs. Nil) for Salary. Similarly, the amount recovered from Reliance IDC Limited, a Wholly Owned Subsidiary of the RCIL, includes Rs. 1 6 crore (Previous year Rs. Nil) for Hire charges.

Network expenses is net of remission of charges of Rs. 461 crore (Previous year Rs. 821 crore) for the deficiency in Passive Infrastructure Services by RITL, a subsidiary of the RCIL, pursuant to the Service Level Agreement between the parties.

Note : 1.11 (Note 2.41 of Annual Accounts)

Disclosure under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED)

Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from October 2, 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the company, the following disclosures are made for the amounts due to Micro and Small Enterprises.

Note : 1.12 (Note 2.43 of Annual Accounts)

Employee Stock Option Scheme

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the Option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted one Equity Share of the Company of Rs. 5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs. 387 crore (Previous year Rs. 389 crore) has been granted to the Trust and the said amount has been utilized by the Trust for purchasing 2.1 3 crore (Previous year 2.13 crore) Equity Shares during the period upto March 31, 2013.

Amortization of compensation includes write back of Rs. 2 crore (Previous year Rs. 5 crore) based on intrinsic value of Options which has been vested under ESOS Plan 2008 and reflected in Statement of Profit and Loss under Employees Benefit Expenses. No amount is chargeable in respect of Options granted under ESOS Plan 2009.

Mar 31, 2012

(1) The Company has only one class of equity shares having a par value of Rs. 5 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholder.

During the year ended March 31, 2012, the amount of per share dividend recognized as distributable to equity shareholders is Rs. 0.25 (March 31, 2011: Rs. 0.50 ). The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

(2) The Company, during the past years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon'ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, alongwith requisite disclosure in the notes to accounts, the cumulative effects of the Schemes in case of Equity Share Capital of the Company due to allotment of equity shares as fully paid up without payment being received in cash have been disclosed herein below.

(3) The Company is no longer required to issue 8.91 crore equity shares of Rs. 5 each as required on conversion of Foreign Currency Convertible Bonds (FCCBs) due to its redemption during the year (Refer Note 2.26).

1.01.1 Debentures and Term Loans

The Company, on February 7, 2012, allotted, 1,500, 11.25% and 5,000, 11.60% Secured, Redeemable, Non Convertible Debentures ("NCDs") of the face value of Rs. 1,00,00,000 each and Rs. 10,00,000 each respectively, aggregating to Rs. 2,000 crore. Redemption of NCDs of Rs. 1,500 crore shall be in four annual equal installments starting at the end of fourth year from the date of allotment thereof and NCDs of Rs. 500 crore shall be at the end of 5th year from the date of allotment thereof. During the earlier year, the Company, on March 2, 2009, allotted, 3,000, 11.20% Secured Redeemable, Non Convertible Debentures ("NCDs") of the face value of Rs. 1,00,00,000 each, aggregating to Rs. 3,000 crore to be redeemed at the end of 10th year from the date of allotment thereof.

11.20% Secured Redeemable, Non Convertible Debentures and 11.60% Secured, Redeemable, Non Convertible Debentures along with foreign currency loans and rupee loans ("Secured Loans") have been secured by first pari passu charge on the whole of the movable plant and machinery, of the Company including (without limitations) tower assets and optic fiber cables, if any (whether attached or otherwise), capital work in progress (pertaining to movable fixed assets) both present and future including all the rights, title, interest, benefits, claims and demands in respect of all insurance contracts relating thereto of the RCOM Group ("the Borrower Group"); comprising of the Company and its subsidiary companies namely; Reliance Telecom Limited (RTl), Reliance Infratel Limited (RITL) and Reliance Communications Infrastructure Limited (RCIL) in favour of the Security Trustee for the benefit of the NCDs Holders and the Lenders of the said Secured Loans. The said loans (Refer Note 2.03.2 (b) (vi)) also include guaranteed. The Company, for the benefit of the Lenders of foreign currency loans, has apart from the above, also assigned 20 Telecom Licenses for services under Unified Access Services (UAS), National Long Distance (NLD) and International Long Distance (ILD) by execution of Tripartite Agreements with Department of Telecommunications (DoT) and IDBI Bank, being the agent acting on behalf of the Lenders.

Assignment of aforesaid Telecom Licenses of the Company in favour of 11.60%, 5,000 Secured Redeemable, Non Convertible Debentures aggregating to Rs. 500 crore and secured foreign currency loans aggregating to Rs. 4,707 crore raised during the year is pending to be executed. Security on the above assets of the Borrower Group on first pari passu basis including assignment of Telecom Licenses of the Company for 1,500, 11.25% Secured Redeemable, Non Convertible Debentures aggregating to Rs. 1,500 crore is pending for execution. Secured foreign currency loans and rupee loans shall be additionally secured by way of a pledge over the shares held by the Company in its subsidiaries; RTL and RCIL, which is pending to be created on first pari passu basis for necessary consent from the existing Secured Lenders.

1.02.1 Cash Credit and Rupee Loans from Banks

The Company and its subsidiaries had during the earlier year, also availed Short Term Borrowings ("Secured Short Term Borrowings") which have been secured by way of second pari passu charge on plant and machinery, including (without limitations) tower assets and optic fiber cables, if any (whether attached or otherwise), capital work in progress (pertaining to movable fixed assets), both present and future, of the Borrower Group; comprising of the Company and its subsidiary companies namely; RTL, RITL and RCIL in favour of the Security Trustee for the benefit of Secured Short Term Lenders.

Working capital (Cash Credit) facilities shall be secured by first pari passu charge over current assets comprising of Stock and receivables of the Company in favour of the working capital lenders, which is pending to be created.

1.3.1 Capital Work in Progress includes:

(a) Rs. 155 crore (Previous year Rs. 615 crore) on account of project development expenditure.

(b) Rs. 57 crore (Previous yearRs. 211 crore) on account of materials at site.

(c) Rs. Nil (Previous year Rs. 7,237 crore) relating to 3G Spectrum fees paid to Department of Telecommunications (DoT).

1.3.2 Transfer of title of certain Land and Buildings received from Reliance Industries Limited pursuant to the Scheme of Arrangement and from Reliance Communications Infrastructure Limited pursuant to scheme of demerger of the Network division are under process.

1.3.3 Pursuant to the Scheme of Amalgamation of Reliance Gateway Net Limited (RGNL), on account of the fair valuation, during an earlier year ended on March 31, 2009, opening gross block of fixed assets included increase in Freehold Land by Rs. 225 crore, Buildings by Rs. 1 30 crore and Telecom Licenses by Rs. 14,145 crore and pursuant to the Scheme of Arrangement, reduction in plant and machinery, on account of transfer of Optic Fiber Undertaking to Reliance Infratel Limited by Rs. 5,078 crore (gross) and accumulated depreciation by Rs. 451 crore.

1.3.4 Balance useful life as at March 31, 2012 is 11 years for Indefeasible Right of Connectivity (IRC), 9 years for 2G Telecom licences and 19 years for 3G Telecom Licences.

1.3.5 Refer Note 2.03.1 and 2.06.1 for Security in favour of the Lenders.

1.3.6 Addition in Plant and Machinery includes Rs. 1,336 crore (net loss) (Previous year Rs. Nil) of exchange difference during the year. Out of this, Rs. 16 crore has been amortised during the year.

1.3.7 Additions in Intangible Assets-Telecom licenses includes Rs. 163 crore (net loss) (Previous year Rs. Nil) on account of exchange difference in the nature of borrowing cost as per para 4 (e) of Accounting Standard (AS) 16, "Borrowing Cost" and Rs. 489 crore of interest costs out of which Rs. 134 crore pertains to current year and Rs. 355 crore to Previous year.

Note : 1.4

Previous year

The financial statements for the year ended March 31, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year's figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for previous year's figures does not impact recognition and measurement principles followed for preparation of financial statements. Amount in financial statements are presented in Rupees crore, except as otherwise stated.

Note : 1.5

Foreign Currency Convertible Bonds (FCCBs)

(i) The Company issued FCCBs in two tranches; 5,00,000 FCCBs for 5 Years, 4.65%, USD 500 million issued on May 9, 2006 and 10,000 FCCBs for 5 Years, 4.95%, USD 1000 million issued on February 28, 2007. Pursuant to the exercise of an Option by the FCCB holders and in accordance with the terms and conditions thereof, the Company, during the earlier years, allotted 1,87,44,801 fully paid equity shares of Rs. 5 each at a pre determined premium of Rs. 475.68 per share against 2,03,051 FCCBs and 6,67,090 fully paid equity shares of Rs.5 each at a pre determined premium of Rs. 656.23 per share against 100 FCCBs respectively.

(ii) During the earlier years, the Company bought back and cancelled 647 nos. of 5 Year, 4.95%, FCCBs of the face value of USD 1,00,000 each, as per approval of the Reserve Bank of India, at a discount to the face value, resulting in a saving of Rs. 101 crore then accounted.

(iii) In accordance with the terms of issue of respective FCCBs, the Company, on due date, redeemed all outstanding 2,96,949 FCCBs aggregating USD 296.95 million on May 9, 2011 and balance outstanding 9,253 FCCBs aggregating USD 925.30 million on February 27, 201 2. As a result, the Company is not required to allot 8.91 crore equity shares of Rs. 5 each arising out of conversion of the said FCCBs. Premium of USD 76.73 million and USD 256.22 million respectively, for the entire tenor, paid on redemption of the respective FCCBs has been charged to Securities Premium Account. This includes an amount of USD 1.79 million and USD 51.78 million respectively pertaining to the year ended March 31, 2012.

Note : 1.6

Foreign Currency Monetary Items; Long Term

In view of the Option allowed pursuant to the notification dated December 29, 2011 issued by the Ministry of Corporate Affairs (MCA), Government of India, for the year ended on March 31, 2012, the Company has added Rs. 1,336 crore of exchange differences on long term borrowing relating to the acquisition of depreciable capital assets to the cost of capitalised assets. Further, the Company has accumulated foreign currency variations of Rs. 315 crore arising on other long term foreign currency monetary items in "Foreign Currency Monetary Item Translation Difference Account", out of which, Rs. 16 crore has been amortised during the year, leaving balance which will be amortised over the balance period of loans.

Note : 1.7

Schemes of Amalgamation and Arrangement of the earlier years

The Company, during the previous years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon'ble High Court of respective Judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Notes to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs. 8,581 crore, being Securities Premium Account, which was part of the Security Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of Rs. 5,538 crore representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs. 2,785 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III of Rs. 28,839 crore comprises of Rs. 4,159 crore transferred to General Reserve from Statement of Profit and Loss and Rs. 24,679 crore arising pursuant to Scheme of Amalgamation of erstwhile Reliance Gateway Net Limited and Rs. 1 crore of erstwhile Global Innovative Solutions Private Limited.

(v) Reserve for Business Restructuring of Rs. 1,287 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited, the holding company of Reliance Infratel Limited after withdrawing an amount equivalent to writing off Passive Infrastructure assets, transferred to Reliance Infratel Limited, to the Statement of Profit and Loss. Balance in Reserve for Business Restructuring shall be available to meet the increased depreciation, costs, expenses and losses including on account of impairment of or write down of assets etc.

(vi) Additional depreciation arising on fair value of the assets has been adjusted from General Reserve III and Provision for Business Restructuring.

(vii) Also refer note 2.38 "Exceptional Items" below.

Note : 1.8

Provisions

Provisions include, provision for disputed claims of verification of customers Rs. 9 crore (Previous year Rs. 9 crore), others of Rs. 1,353 crore (Previous year Rs. 1,399 crore), and reversal of disputed liabilities of Rs. 46 crore (Previous year Rs. 102 crore).

The aforesaid provisions shall be utilised on settlement of the claims, if any, there against.

Note : 1.9

Contingent Liabilities and Capital Commitment (as represented by the Management)

(Rs. in Crore)

As at As at March 31, 2012 March 31, 2011

(i) Estimated amount of contracts remaining to be executed on capital accounts (net of 294 357 advances) and not provided for

(ii) Disputed Liabilities in Appeal

- Sales Tax and VAT 18 12

- Excise and Service Tax 2 2

- Entry Tax and Octroi 28 23

- Other Litigations 31 27

- Interest on ADC on FWP/ T 342 160

(iii) Guarantees given by the Company on behalf of its Subsidiaries 5,472 1,116

(iv) Guarantees given by the Company on behalf of other companies for business purpose 51 421

(v) License Fees

The Hon'ble Supreme Court, vide its judgment dated October 11, 2011, has set aside the Order of Telecom Disputes Settlement and Appellate Tribunal (TDSAT) dated August 30, 2007 and allowed two months' time to the licencees to raise their disputes before the Hon'ble TDSAT w.r.t. the demands already raised by Department of Telecommunications (DoT). The Hon'ble Supreme Court, in the meanwhile, also restrained DoT from enforcing its demands already raised. By Order dated December 15, 2011, the Hon'ble TDSAT granted all licensees/ operators the liberty to file additional affidavits thereby bringing on record the material facts including the subsequent events with respect to the petitions already pending before the Hon'ble TDSAT, which have been revived pursuant to the aforesaid judgement of the Hon'ble Supreme Court. On April 12, 2012, all the petitions (both old and new of all the operators including of the Company) were heard and an interim order of protection, earlier passed was extended to the new AGR petitions. The matter is pending for further hearing/ orders scheduled before the Hon'ble TDSAT on July 2, 2012.

(vi) Access Deficit Charges (ADC)

The Hon'ble TDSAT and the Hon'ble Supreme Court, vide their judgments dated January 17, 2006 and April 30, 2008 respectively upheld the circular of Bharat Sanchar Nigam Limited (BSNL) dated January 14, 2005 whereby and whereunder the Company's fixed wireless phone (FWP) service was declared as limited mobile service. The period of claim, which was raised before the Hon'ble Supreme Court, was from November 14, 2004 to August 26, 2005. As directed by the Hon'ble Supreme Court, on April 30, 2008, the Company moved before the Hon'ble TDSAT for quantification of ADC for aforesaid period. The Hon'ble TDSAT vide its judgement dated April 17, 2012 confirmed the liability of the Company for the said period and for subsequent periods. The Company already has an adequate provision of Rs. 540 crore in the books for the liability which has been determined to be payable. Further course of action including the financial impact, if any, for the balance amount, which is under dispute shall be determined on completion of reconciliation with BSNL.

(vii) Special Audit

Pursuant to the Telecom License Agreement, DoT directed audits of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company and some of its subsidiaries for the years ended March 31, 2007 and March 31, 2008 relating to license fees and revenue share. The Company and its subsidiary have received show cause notices dated January 31, 2012 based on report of the Special Audit directed by DoT relating to alleged shortfall of license fees and revenue share of Rs. 300 crore and interest thereon as applicable. The Company has submitted its reply to DoT towards show cause notice. The Company is confident that based on advice and, inter alia, on current understanding of the regulation by the industry and judicial pronouncements directly applicable to the issues raised in the special audit report, there shall not be any liability in this regard and hence, no provision is required in the accounts of the Company.

Note : 1.10 Operating Lease

The Company's significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements. The Company is a lessee in respect of Optic Fibres and in respect of this lease, lease rent of Rs. 1,141 crore, (Previous year Rs. 1,141 crore) including Rs. 1,129 crore (Previous year Rs. 1,129 crore) not leviable for the year as per the lease agreement, has been recognised on a straight line basis as Network Expenses and corresponding amount is included in Long Term Provisions.

Note : 1.11 Export Commitments

The Company has obtained licenses/ authorisations under the Export Promotion Capital Goods (EPCG) Scheme for importing capital goods at a concessional rate of customs duty against submission of bonds. Under the terms of the respective licenses/ authorisations, the Company is required to export goods of FOB value equivalent to or more than, eight times the amount of duty saved in respect of such licenses/ authorisations, where export obligation has been refixed by the order of Director General Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, as applicable. The Company has fulfilled its export obligation under the aforesaid license as on March 31, 2012 and has submitted necessary documents to DGFT for availing redemption letter for completion of export obligation amounting to Rs. 334 crore (Previous year Rs. 334 crore).

Note : 1.12

Segment Performance

Disclosure as per Accounting Standard ("AS") 17 "Segment Reporting" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of AS.

Note : 1.13 Exceptional Items

Pursuant to the direction of the Hon'ble High Court of Judicature of Mumbai and Option exercised by the Board of the Company, in accordance with and as per the Scheme of Arrangement approved by the Hon'ble High Court vide order dated July 3, 2009 binding on the Company, expenses and/ or losses, identified by the Board of the Company as being exceptional or otherwise subject to the Accounting treatment prescribed in the said Scheme and comprising of Rs. 268 crore of debts due including, in particular, debts due from telecom operators whose licences are under cancellation pursuant to the directions of the Hon'ble Supreme Court in its order dated February 2, 2012 in the matter of Centre for Public Interest Litigation and others vs. Union of India and others and subsidy claimed from the Government, Rs. 849 crore unrealised net losses, including Rs. 775 crore regarded as an adjustment to interest cost, on account of restating Long Term monetary items expressed in foreign currency at year end prevailing rates, as also Rs. 199 crore of net realised losses on settlement of items recovered and/ or discharged in foreign currency, and Rs. 16 crore (Refer Note 2.27) as the amortised portion of FCMITDA, in accordance with Para 46A of Accounting Standard (AS) 11 "The Effects of Changes in Foreign Exchange Rates" in context of unprecedented volatility in exchange rates during the year, have been met by corresponding withdrawal from General Reserve, leaving no impact on profit for the year ended March 31, 2012. Such withdrawals have been included/ reflected in the Statement of Profit and Loss.

While the Company has been legally advised that such inclusion in the Statement of Profit and Loss is in accordance with Revised Schedule VI of the Companies Act, 1 956, the Company is also seeking clarification from the ICAI that such inclusion in the Statement of Profit and Loss is not contrary to Revised Schedule VI.

Had such write off of expenses and losses not been met from General Reserve, the Company would have reflected a Loss after tax of Rs. 1,176 crore and the consequential effect of this on the profit after tax for the year would have been Rs. 1,332 crore.

Note : 1.14

Recovery of Expenses

Expenses under the heads Provision for Employee Costs and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company. Such amounts recovered for the year amounting to Rs. 84 crore (Previous year Rs. 200 crore) for Salaries, Rs. 409 crore (Previous year Rs. 435 crore) for Sales and General Administration Expenses comprising of Rs. 46 crore (Previous year Rs. 35 crore) for Advertising Expenses, Rs. 305 crore (Previous year Rs. 327 crore) for Customer Acquisition, Commission, Billing and Collection, Webstore Expenses and Customer Care, Rs. 58 crore (Previous year Rs. 73 crore) for Hire Charges. Similarly, the amount recovered from Reliance Infratel Limited, a subsidiary of Reliance Communications Infrastructure Limited for the year includes Rs. 26 crore (Previous year Rs. 84 crore) for Salaries and Rs. 67 crore (Previous year Rs. 36 crore) for Sales and General Administration Expenses comprising of, Rs. 22 crore (Previous year Rs. 1 crore) for hire charges and Rs. 45 crore for other General Administration Expenses (Previous year Rs. 35 crore). Similarly, the amount recovered from Reliance Big TV Limited, a Wholly Owned Subsidiary of the Company includes Rs. 4 crore (Previous year Rs. 5 crore) for Hire Charges and Rs. 26 crore (Previous year Rs. 26 crore) for Salaries. Similarly, the amount recovered from Reliance Telecom Limited, a Wholly Owned Subsidiary of the Company includes Rs. 93 crore (Previous year Rs. Nil) for Salary, Rs. 14 crore (Previous year Rs. Nil) for Advertisement and Marketing Expenses, Rs. 111 crore (Previous year Rs. Nil) for General Administrative Expenses and Rs. 7 crore (Previous year Rs. Nil) towards Network Charges. Network Expenses is net of remission of charges of Rs. 821 crore, including Rs. 476 crore of the Previous year, for the deficiency in Passive Infrastructure Services by Reliance Infratel Limited, a subsidiary of the Company pursuant to the Service Level Agreement between the parties.

Note : 1.15

Financial Statements of Subsidiary Companies

The Ministry of Corporate Affairs, Government of India vide its General circular no. 2 and 3, dated February 8, 2011 and February 21, 2011 respectively, has granted general exemption from compliance with Section 212 of the Companies Act, 1956, subject to fulfilment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence, is entitled to the exemption. As per the circular, key details of each subsidiary is attached in the Consolidated Financial Statements.

Note : 1.16

Employee Benefits

Gratuity : In accordance with the applicable Indian laws, the Company provides for the gratuity, a defined benefit retirement plan (Gratuity Plan) for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employee's last drawn salary and for the years of employment with the Company

The following table sets out the status of the Gratuity Plan as required under Accounting Standard ("AS") 15 (Revised) "Employee Benefits",

Provident Fund : The guidance on Implementing ("AS") 15 "Employee Benefits" (revised 2005) issued by the ICAI states that the benefits involving employer established Provident Fund, which require interest shortfalls to be recompensed are to be considered as/ in defined benefit plans. The employee and employer each make monthly contribution to the plan equal to 12% of the covered employee's salary. Contributions are made to the trust established by the Company. During the year ended March 31, 2012, the Actuarial Society of India issued the final guidance for measurement of provident fund liabilities. As at March 31, 2012, Fair value of plan assets is Rs. 294 crore, the present value of defined benefit obligation is Rs. 296 crore. Accordingly, based on such actuarial valuation, the Company has charged Rs. 2 crore (Previous year Rs. Nil), being shortfall in interest, during the year. For the year ended March 31, 2012, the Company has contributed Rs. 22 crore (Previous year Rs. 25 crore) towards Provident Fund. The Employee Benefits as disclosed herein pertain to the Company.

The assumptions made for the above are Discount rate of 8.50%, average remaining tenure of Investment Portfolio is 7 years and guaranteed rate of return is 8.25%.

Note : 1.17

Employee Stock Option Schemes

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company, the Holding Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the Option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted one Equity Share of the Company of Rs. 5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs. 389 crore (Previous year Rs. 389 crore) has been granted to the Trust and Rs. 391 crore (Previous year Rs. 391 crore) has been utilised by the Trust for purchasing 2.13 crore (Previous year 2.13 crore) equity shares during the period upto March 31, 2012.

Amortization of compensation includes write back of Rs. 5 crore (Previous year Rs. 7 crore) based on intrinsic value of Options which have been vested under ESOS Plan 2008 and reflected in Statement of Profit and Loss under Employee Benefit Expenses. No amount is chargeable in respect of Options granted under ESOS Plan 2009.

No derivative instruments are acquired for speculation purpose.

In respect of Foreign Currency Swap and Interest Rate Swap transactions, which are linked with LIBOR rates and exchange rate during the period of contract, gains/ losses, if any, are recognised on the settlement day or the reporting day, whichever is earlier, at the rate prevailing on respective day.

Foreign Currency exposures that are not hedged by derivative instruments or otherwise for Loans/ Liabilities and assets are USD 428 crore (Previous year USD 457 crore), equivalent to Rs. 21,770 crore (Previous year Rs. 20,371 crore).

Above exposure status does not include the effects of accruals.

The unamortised premium of Buyers' Credit to be recognized is Rs. 2 crore (Previous year Rs. 18,86,127) for one or more subsequent accounting periods.

Disclosure in respect of transactions, which are more than 10% of the total transactions of the same type with a related party during the year ended March 31, 2012

1. Fixed assets acquired during the year include Rs. 86 crore from Reliance Tech Services Private Limited, Rs. 36 crore from Reliance Infratel Limited and Rs. 16 crore from Alcatel-Lucent Managed Solutions India Private Limited (Previous Year - Fixed assets acquired during the year include Rs. 34 crore from Reliance Tech Services Private Limited and Rs. 32 crore from Reliance Infratel Limited and Rs. 28 crore from Alcatel-Lucent Managed Solutions India Private Limited).

2. Loans and Advances include loans granted during the year of Rs. 12,772 crore to Reliance Communications Infrastructure Limited, Rs. 2,509 crore to Reliance Telecom Limited, and repaid/ adjusted during the year Rs. 12,474 crore by Reliance Communications Infrastructure Limited, Rs. 2,137 crore by Reliance Telecom Limited and Rs. Nil by Reliance Infratel Limited. (Previous year - Loans and Advances include loan granted during the year of Rs. 5,945 crore to Reliance Communications Infrastructure Limited, Rs. 21,291 crore to Reliance Telecom Limited, and repaid during the year Rs. 6,033 crore by Reliance Communications Infrastructure Limited, Rs. 23,395 crore by Reliance Telecom Limited and Rs. 3,549 crore by Reliance Infratel Limited.

3. Sundry Debtors include Rs. 230 crore from Reliance Telecom Limited, Rs. 127 crore from Reliance Webstore Limited, Rs. 34 crore from Reliance Communications Inc, Rs. 39 crore from Reliance Communications Infrastructure Limited (Previous year - Sundry Debtors include Rs. 31 crore Reliance Telecom Limited, Rs. 11 crore from Reliance Webstore Limited, Rs. 277 crore from Reliance Communications Inc. and Rs. 115 crore from Reliance Communications Infrastructure Limited).

4. Loans given include Rs. 1,827 crore to Reliance Communications Infrastructure Limited, Rs. 1,839 crore to Reliance Telecom Limited, Rs. 2,719 crore to Reliance Infratel Limited and Advances include Rs. Nil to Reliance Communications Infrastructure Limited, Rs. 44 crore to Reliance Telecom Limited, Rs. 23 crore to Reliance Webstore Limited (Previous year - Loans given include Rs. 1,529 crore to Reliance Communications Infrastructure Limited, Rs. 1,467 crore to Reliance Telecom Limited, Rs. 2,719 crore to Reliance Infratel Limited and Advances include Rs. 1,431 crore to Reliance Communications Infrastructure Limited, Rs. Nil to Reliance Telecom Limited and Rs. Nil to Reliance Webstore Limited).

5. Sundry Creditors include Rs. 39 crore to Reliance Flag Atlantic France SAS, Rs. 69 crore to Reliance Communications (UK) Limited, Rs. 7 crore to Reliance Infratel Limited, Rs. 78 crore to Reliance Tech Services Private Limited, Rs. 64 crore to Alcatel-Lucent Managed Solutions India Private Limited, (Previous year - Sundry Creditors include Rs. 108 crore to Reliance Flag Atlantic France SAS, Rs. 53 crore to Reliance Communications (UK) Limited, Rs. 61 crore to Reliance Infratel Limited, Rs. 55 crore to Reliance Tech Services Private Limited and Rs. 79 crore to Alcatel-Lucent Managed Solutions India Private Limited).

Sundry Creditors also includes Rs. 217 crore to Reliance Infratel Limited for availing passive infrastructure services for 3G Operations. (Previous Year - Sundry Creditors also includes Rs. 217 crore to Reliance Infratel Limited for availing passive infrastructure services for 3G Operations).

6. Other Current Assets includes Rs. 51 crore of Unbilled revenue of Reliance Communications Inc., Interest Receivable includes Rs. 892 crore from Reliance Infratel Limited and Rs. 16 crore Deposit to Alcatel-Lucent Managed Solutions India Private Limited.

(Previous year - Rs. 50 crore of Unbilled revenue of Reliance Communications Inc, Interest Receivable includes Rs. 670 crore from Reliance Infratel Limited, and Rs. 16 crore Deposit to Alcatel-Lucent Managed Solutions India Private Limited).

7. Investments include conversion of Loans into Preference Shares during the year Rs. Nil of Reliance Infratel Limited and conversion of Preference Shares of Rs. Nil of Reliance Globalcom BV into equity shares. Redemption of Preference Shares during the year includes Rs. Nil of Reliance Globalcom BV and Rs. 223 crore of Reliance Globalcom Limited Bermuda (Previous year- Investments include conversion of Loans into Preference Shares Rs. 2,500 crore of Reliance Infratel Limited and conversion of Preference Shares of Rs. 2,276 crore of Reliance Globalcom BV into equity shares. Redemption of Preference Shares includes Rs. 1,528 crore of Reliance Globalcom BV and Rs. 764 crore of Reliance Globalcom Limited Bermuda).

8. Unearned Income includes Rs. 14 crore from Reliance Flag Telecom Ireland Network Limited and Rs. 5 crore from Reliance FLAG Atlantic France SAS. (Previous Year- Unearned Income includes Rs. 15 crore from Flag Telecom Ireland Network Limited and Rs. 4 crore from Reliance FLAG Atlantic France SAS.)

9. Prepaid expenses includes Rs. 10 crore from Reliance FLAG Atlantic France SAS and Rs. 87 crore from Reliance Telecom Limited. (Previous year-Prepaid expense includes Rs. 10 crore from Reliance FLAG Atlantic France SAS and Rs. Nil from Reliance Telecom Limited).

10. Financial Guarantee issued includes Rs. Nil to Reliance Globalcom BV (Previous year - Rs. 70 crore to Reliance Globalcom BV).

11. Corporate Guarantee issued includes Rs. 3,508 crore to Reliance Infratel Limited and Rs. 1,463 crore to Reliance Telecom Limited. (Previous year - Corporate Guarantee issued includes Rs. 189 crore to Reliance Infratel Limited and Rs. 749 crore to Reliance Telecom Limited).

12. Turnover includes Rs. 1,182 crore from Reliance Communications Infrastructure Limited, Rs. 601 crore from Reliance Communications Inc., Rs. 721 crore from Reliance Telecom Limited. (Previous year - Turnover includes Rs. 845 crore from Reliance Communications Infrastructure Limited, Rs. 488 crore from Reliance Communications Inc. and Rs. 666 crore from Reliance Telecom Limited).

13. Other Income includes Sale of Capital inventories of Rs. Nil to Reliance Webstore Limited (Previous Year - Rs. 95 crore to Reliance Webstore Limited)

14. Interest income includes Rs. 596 crore received from Reliance Infratel Limited (Previous year - Interest income includes Rs. 595 crore received from Reliance Infratel Limited).

15. Expenditure includes Access Charges: Rs. 173 crore to Reliance Communications Inc. and Rs. 274 crore to Reliance Telecom Limited, Network Operation Expenses: Rs. 1,178 crore to Reliance Infratel Limited and Rs. 180 crore to Alcatel-Lucent Managed Solutions India Private Limited. Selling and Marketing expenses: Rs. 136 crore to Reliance Communications Infrastructure Limited and Rs. 38 crore to Reliance Webstore Limited. General and Administrative Expenses: Rs. 209 crore to Reliance Communications Infrastructure Limited, Rs. 51 crore to Reliance Infocomm Infrastructure Private Limited and Rs. 40 crore to Reliance Tech Services Private Limited. (Previous year - Expenditure includes Access Charges: Rs. 126 crore to Reliance Communications Inc., Rs. 240 crore to Reliance Telecom Limited, Network Operation Expenses: Rs. 3,551 crore to Reliance Infratel Limited. Selling and Marketing expenses: Rs. 151 crore to Reliance Communications Infrastructure Limited and Rs. 117 crore to Reliance Webstore Limited. General and Administrative Expenses: Rs. 226 crore to Reliance Communications Infrastructure Limited, Rs. 41 crore to Reliance Infocomm Infrastructure Private Limited and Rs. 21 crore to Reliance Tech Services Private Limited).

16. Expenses under the heads Provision for Employee Costs and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company. Such amounts recovered for the year amounting to Rs. 84 crore for Salaries, Rs. 409 crore for Sales and General Administration Expenses comprising of Rs. 46 crore for Advertising Expenses, Rs. 305 crore for Customer Acquisition, Commission, Billing and Collection, Webstore expenses and Customer Care, Rs. 58 crore for Hire Charges. Similarly, the amount recovered from Reliance Infratel Limited, a subsidiary of RCIL for the year includes Rs. 26 crore for Salaries and Rs. 67 crore for Sales and General Administration Expenses comprising of Rs. 22 crore for Hire Charges and Rs. 45 crore for Other General Administration Expenses. Similarly, the amount recovered from Reliance Big TV Limited, a Wholly Owned Subsidiary of the Company includes Rs. 4 crore for Hire Charges and Rs. 26 crore for Salaries. Similarly, the amount recovered from Reliance Telecom Limited, a Wholly Owned Subsidiary of the Company includes Rs. 93 crore for Salary, Rs. 14 crore for Advertisement and Marketing Expenses, Rs. 111 crore for General Administration Expenses and Rs. 7 crore towards Network charges (Previous Year - Expenses under the heads Provision for Employee Costs and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company. Such amounts recovered Rs. 200 crore for Salaries, Rs. 435 crore for Sales and General Administration Expenses comprising of Rs. 35 crore for Advertising Expenses, Rs. 327 crore for Customer Acquisition, Commission, Billing and Collection, Webstore expenses and Customer Care, Rs. 73 crore for Hire Charges. Similarly, the amount recovered from Reliance Infratel Limited, a subsidiary of RCIL includes Rs. 84 crore for Salaries and Rs. 36 crore for Sales and General Administration Expenses comprising of Rs. 1 crore for Hire Charges and Rs. 35 crore for Other General Administration Expenses. Similarly, the amount recovered from Reliance Big TV Limited, a Wholly Owned Subsidiary of the Company includes Rs. 5 crore for Hire Charges and Rs. 26 crore for Salaries. Similarly, the amount recovered from Reliance Telecom Limited, a Wholly Owned Subsidiary of the Company includes Rs. Nil for Salary, Rs. Nil for Advertisement and Marketing Expenses, Rs. Nil for General Administration Expenses and Rs. Nil towards Network charges).

Mar 31, 2011

1 Previous year

Figures of the Previous year have been regrouped and reclassified, wherever required. Previous year's figures are not comparable on account of the effects of the Scheme considered during the year.

2 Foreign Currency Convertible Bonds (FCCBs)

(i) The Company issued FCCBs in two tranches; 5,00,000 FCCBs for 5 years, 4.65%, USD 500 million issued on May 9, 2006 and 10,000 FCCBs for 5 years, 4.95%, USD 1,000 million issued on February 28, 2007. Pursuant to the exercise of an option by the FCCB Holders and in accordance with the terms and conditions thereof, the Company, during the earlier years, allotted 1,87,44,801 fully paid Equity Shares of Rs. 5 each at a pre determined premium of Rs. 475.68 per share against 2,03,051 FCCBs and 6,67,090 fully paid Equity Shares of Rs. 5 each at a pre determined premium of Rs. 656.23 per share against 100 FCCBs respectively.

(ii) During the earlier years, the Company has bought back and cancelled 647 nos. of 5 year, 4.95%, FCCBs of the face value of USD 1,00,000 each, as per approval of the Reserve Bank of India, at a discount to the face value.

Out of total FCCBs issued, 2,96,949 (Previous year 2,96,949) FCCBs and 9,253 (Previous year 9,253) FCCBs from the respective tranches were outstanding as on March 31, 2011.

(iii) Subsequent to the date of Balance sheet, i.e. March 31, 2011, in accordance with the terms of issue of 5,00,000 FCCBs for 5 years, 4.65%, USD 500 million issued on May 9, 2006, the Company has redeemed all outstanding FCCBs by making payment on due date i.e. May 9, 2011. As a result, the Company is not required to allot 2,74,13,085 Equity Shares of Rs. 5 each arising out of conversion of the said FCCBs.

(iv) In the event, if the outstanding FCCBs are fully converted into Equity Shares, the Equity Share Capital of the Company would increase by approximately 6.17 crore (Previous year 8.91 crore) Equity Shares of Rs. 5 each.

(v) In case of the above mentioned FCCBs, on and at anytime after February 28, 2010 on and prior to the maturity date, the Company may, subject to certain terms and conditions as per the offering memorandum, redeem the FCCBs in whole and not in part at their Early Redemption amount, provided that no such redemption may be made unless the aggregate value (as defined in the terms and conditions) on each trading day during the periods of not less than 30 consecutive trading days, ending not earlier than 14 days prior to the date upon which notice of such redemption is given, was at least 130 percent of the early redemption amount.

(vi) FCCBs amount includes Rs. 1,245.87 crore (Previous year Rs. 942.32 crore), being the premium on redemption of FCCBs computed on pro rata basis for the period up to March 31, 2011.

3 Foreign Exchange

During the year, loss of Rs. 105.36 crore (Previous year Rs. Nil) arising out of marking related Derivative Contracts to market has been recognized in the profit and Loss Account, in compliance with the announcement dated March 29, 2008 by the Institute of Chartered Accountants of India (ICAI) regarding Accounting for Derivatives.

4 Schemes of Amalgamation and Arrangement of the earlier years

The Company, during the past years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon'ble High Courts of respective judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Schedule to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs. 8,882.62 crore, being Securities Premium Account, which was part of the Security Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserves I of Rs. 5,538.00 crore representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserves II ofRs. 2,785.21 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) General Reserve III ofRs. 30,229.81 crore comprises ofRs. 4,375.43 crore transferred to General Reserve from the profit and Loss Account and Rs. 25,854.38 crore arising pursuant to Scheme of Amalgamation of Reliance Gateway Net Limited.

(v) Reserve for Business Restructuring of Rs. 1,287.10 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited (RCIL), the Holding Company of Reliance Infratel Limited (RITL) after withdrawing an amount equivalent to writing off Passive Infrastructure assets, transferred to RITL, to the profit and Loss Account. Balance in Reserve for Business Restructuring shall be available to meet the increased depreciation, costs, expenses and losses including on account of impairment of or write down of assets etc.

(vi) Additional depreciation arising on fair value of the assets has been adjusted from General Reserve III and Provision for Business Restructuring.

5 Scheme of Amalgamation and Arrangement

Pursuant to the Scheme of Amalgamation ("the Scheme") under Sections 391 to 394 of the Companies Act, 1956 sanctioned by the Hon'ble High Court of Bombay vide Order dated April 29, 2011 and filed with the Registrar of Companies (RoC) on May 25, 2011, Global Innovative Solutions Private Limited (GISPL), a Wholly Owned Subsidiary of the Company, engaged in allied telecommunication activities, has been amalgamated into the Company with effect from the Appointed Date as on April 1, 2010.

As per the said Scheme:

(i) All the assets and liabilities as appearing in the books of GISPL as on the Appointed Date have been recorded in the books of the Company at their respective book values and inter company balances have been cancelled.

(ii) Excess of assets over liabilities of Rs. 1.002 crore has been credited to General Reserve III of the Company.

(iii) The Company's investment in the share capital of GISPL amounting to Rs. 1.00 crore has been written off to the profit and Loss Account and an equivalent amount has been withdrawn from General Reserve III.

Had the Scheme not prescribed this treatment, Rs. 0.002 crore would have been credited to Capital Reserve as required by the Purchase Method prescribed by Accounting Standard (AS) 14 "Accounting for Amalgamation".

6 Depreciation on Electronic Equipments

During the previous year, the Company had carried out technical/ technology assessment to determine the useful life of some of its telecommunications equipments. The useful life of such telecommunications equipments had been re-assessed and ascertained as 18 years, impacting the provision of depreciation of these assets for the year ended on March 31, 2010. As a result, depreciation charge was lower and profits for the previous year was higher by Rs. 771.00 crore. The accounting treatment so determined has been fully in accordance with the applicable provisions of the Companies Act, 1956.

8 Provisions

(i) Provisions include, provision for disputed claims of verification of customers Rs. 9.04 crore (Previous year Rs. 9.04 crore) and others of Rs. 1,398.75 crore (Previous year Rs. 1,650.88 crore) net of payment of Rs. 150 crore to Department of Telecommunications (DoT) in relation to the matter pertaining to Home Country Direct (HCD) Calls and Provision for Commission to Non Executive Directors of Rs. Nil (Previous year Rs. 0.60 crore).

(ii) During the year, an amount of Rs. Nil (Previous yearRs. 140.00 crore) relating to Roll out obligations, Rs. 102.13 crore (Previous year Rs. 50.52 crore) relating to disputed liablities have been reversed and provided an amount of Rs. Nil (Previous year Rs. 5.64 crores) towards disputed interconnect usage charges. Further, the Company paid Rs. 0.60 crore (Previous yearRs. 0.60 crore) towards commission to Non Executive Directors for the financial year 2009-10.

(iii) Also refer Note 2 (vi) above.

The aforesaid provisions shall be utilised on settlement of the claims, if any, thereagainst.

9 Contingent Liabilities and Capital Commitment (as represented by the Management)

(Rs. in crore)

As at As at March 31, 2011 March 31, 2010

(i) Estimated amount of contracts remaining to be 356.78 220.22 executed on capital accounts (net of advances) and not provided for

(ii) Disputed Liabilities in Appeal

- Sales Tax and VAT 12.48 52.05

- Excise and Service Tax 2.08 2.08

- Entry Tax and Octroi 23.30 1.55

- Other Litigations 27.19 0.30

- Interest on ADC on FWP/T 160.40 -

(iii) Guarantees given by the Company on behalf of its 1,116.14 2,536.64 Subsidiaries

(iv) Guarantees given by the Company on behalf of other 420.64 461.99 companies for business purpose

10 Deferred Tax Assets and Liabilities

The Company being in the business of Telecommunication Services, Broadband Network and Internet services, are eligible for deduction u/s 80IA (Tax Holiday) of the Income tax Act, 1961. Since the Deferred Tax Liability in respect of timing difference is expected to reverse during Tax Holiday Period, the same is not recognised in books of accounts as at March 31, 2011 as per the Accounting Standard (AS) 22 of "Accounting for Taxes on Income" as referred to in Accounting Standard Rules. Following the principle of prudence, the Company has not recognised Deferred Tax Asset in respect of debits for equalised lease rentals.

16 Operating Lease

The Company's significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements. The Company is a lessee in respect of Optic Fibres and in respect of this lease, lease rent of Rs.1,141.00 crore, (Previous year Rs.1,141.00 crore) including Rs. 1,129.00 crore (Previous year Rs.1,129.00 crore) not leviable for the year as per the lease agreement, has been recognised on a straight line basis as Network Expenses and corresponding amount is included in Sundry Creditors.

18 Export Commitments

The Company has obtained licenses/ authorisations under the Export Promotion Capital Goods (EPCG) Scheme for importing capital goods at a concessional rate of customs duty against submission of bonds. Under the terms of the respective licenses/ authorisations, the Company is required to export goods of FOB value equivalent to or more than, eight times the amount of duty saved in respect of such licenses/ authorisations, where export obligation has been refixed by the order of Director General Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, as applicable. The Company has fulfilled its export obligation under the aforesaid licenses as on March 31, 2011 and has submitted the necessary documents to DGFT for availing redemption letter for completion of export obligation amounting to Rs. 334.00 crore (Previous year Rs. 494.40 crore).

19 Segment Performance

Disclosure as per Accounting Standard (AS) 17 "Segment Reporting" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provision of AS.

20 Employee benefits

Gratuity : In accordance with the applicable Indian laws, the Company provides for the gratuity, a defined benefit retirement plan (Gratuity Plan) for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employee's last drawn salary and for the years of employment with the Company.

Provident Fund : The guidance on implementing Accounting Standards ("AS") 15 "Employee benefits" (revised 2005) issued by the ICAI states that the benefits involving employer established Provident Fund, which require interest shortfalls to be recompensed are to be considered defined benefit plans. The actuary of the Company has expressed his inability to reliably measure provident fund liabilities as the guidance note from The Institute of Actuaries of India is yet to be issued. Accordingly, the Company is unable to provide the related information.

21 Disclosure under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED)

Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from October 2, 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the Company, the following disclosures are made for the amounts due to the Micro and Small Enterprises.

24 Employee Stock Option Scheme

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company the Holding Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The Vesting of the Options is on the expiry of one year from the date of Grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the Vesting Period. Each Option entitles the holder thereof to apply for and be allotted one Equity Share of the Company of Rs. 5 each upon payment of the Exercise Price during the Exercise Period. The maximum Exercise Period is 10 years from the date of Grant of Options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs. 388.77 crore (Previous year Rs. 331.16 crore) has been granted to the Trust and Rs. 390.95 crore (Previous year Rs. 331.00 crore) has been utilised by the Trust for purchasing 2.13 crore (Previous year 1.67 crore) Equity Shares during the period upto March 31, 2011.

Amortization of compensation includes write back of Rs. 6.73 crore (Previous year Rs. 6.65 crore) based on intrinsic value Options which have been vested under ESOS Plan 2008 and reflected as Exceptional Item in profit and Loss Account. No amount is chargeable in respect of Options granted under ESOS Plan 2009.

25 Exceptional Items

Amortization of compensation is net of write back of charges of Rs. 6.73 crore (Previous yearRs. 6.65 crore) based on intrinsic value of Options, which have lapsed under ESOS Plan 2008 as mentioned in Note 24 above and Stamp Duty of Rs. Nil (Previous year Rs. 25 crore) paid by the Company on conveyancing of the assets pursuant to the Schemes approved by the Hon'ble High Court.

26 Recovery of Expenses

Expenses under the heads Provision for Employees Cost and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited (RCIL), a Wholly Owned Subsidiary of the Company. Such amounts recovered for the year amount to Rs. 200.44 crore (Previous year Rs. 116.86 crore) for Salaries, Rs. 434.61 crore (Previous year Rs. 506.91 crore ) for Sales and General Administration Expenses comprising of Rs. 34.87 crore (Previous year Rs. 81.00 crore) for Advertising Expenses, Rs. 326.96 crore (Previous year Rs. 339.62 crore) for Customer Acquisition, Commission, Billing and Collection, Webstore expenses and Customer Care, Rs. 72.78 crore (Previous year Rs. 86.29 crore) for Hire Charges. Similarly, the amount recovered from Reliance Infratel Limited (RITL), a subsidiary of RCIL for the year includes Rs. 88.09 crore (Previous year Rs. 17.75 crore) for Salaries and Rs. 26.54 crore (Previous year Rs. 35.76 crore) for Sales and General Administration Expenses. The Company has also collected interest, equivalent to its cost of funds, from RITL and Reliance Telecom Limited (RTL) amounting to Rs. 594.63 crore (Previous yearRs. 250.55 crore) and Rs. 47.85 crore (Previous yearRs. 230.96 crore) respectively for the year ended March 31, 2011. Similarly, the amount recovered from Reliance Big TV Limited (RBTV), a Wholly Owned Subsidiary of the Company includes Rs. 4.53 crore (Previous yearRs. Nil) for Hire Charges and Rs. 26.08 crore (Previous yearRs. 37.11 crore) for Salaries.

27 Debenture Redemption Reserve

In view of the loss during the year, the Company has not created Debenture Redemption Reserve of Rs. 74.96 crore in terms of Section 117 (C) of the Companies Act, 1956. The Company shall create such reserve out of profit, if any in future years.

28 General Reserve

The Company, during the year, transferred Rs. 216.19 crore, out of the balance of Rs. 4,375.43 crore in General Reserve III created by transfer from profit and Loss Account in earlier years, pursuant to Section 205A (3) of the Companies Act, 1956 and the Companies (Declaration of Dividend out of Reserves) Rules, 1975 and proposed dividend out of the accumulated profits of the previous years.

29 License Fees

The Company accounts for its liabilities in respect of Licence Fees payable for its Telecom as well as Direct To Home (DTH) businesses by way of Revenue Share to be computed on the Gross Revenue of the Company after taking into account the decision of Telecom Disputes Settlement And Appellate Tribunal (TDSAT) dated August 30, 2007 specifying that revenues not related to unified Access Services (UAS) and Other Licences under which the Company operates are not to be included in the computation of Revenue Share. The TDSAT has, by its decision dated March 26, 2009 and May 7, 2010 applied the said decision dated August 30, 2007 to the Company. The decision of the TDSAT is the subject matter of Appeal pending before the Supreme Court. No provision is considered necessary in this regard.

30 Special Audit

Pursuant to the Telecom License Agreement, Department of Telecommunications (DoT) directed audits of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company and some of its subsidiaries for the years ended March 31, 2007 and March 31, 2008 relating to license fees and revenue share. The report of the Special Auditor's alleging a shortfall of license fee and revenue share of Rs. 316.00 crore is mala fide and is in the Company's opinion biased and full of errors and inaccuracies. Criminal complaints filed by the Company against the wrongful leaking of the Report are being investigated by the Police. The ICAI is investigating the professional and other misconduct of the Special Auditor. The Company has also made presentations and representations to DoT on the observations of the Special Auditor. The Company is advised that based, inter alia, on current understanding of the regulation by the industry and judicial pronouncements directly applicable to the issues raised in the special audit report, all of which have not been properly considered nor appreciated in the Report, no provision is required in the accounts of the Company.

31 Financial Statements of Subsidiary Companies

The Ministry of Corporate Affairs, Government of India vide its General circular no. 2 and 3 dated February 8, 2011 and February 21, 2011, has granted general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitiled to the exemption. Necessary information relating to subsidiaries has been included in the Consolidated Financial Statements.

32 Related Parties

As per Accounting Standard (AS) 18, 'Related Party Disclosures' prescribed under the Accounting Standard Rules, the disclosures of transactions with the related parties are given below.

A List of Related Parties : where control exists

Sr. Name of the Subsidiary Companies (direct and step No. down subsidiaries)

1 Reliance WiMax Limited

2 Reliance Digital Home Services Limited

3 Reliance Webstore Limited

4 Reliance Infocomm Infrastructure Private Limited

5 Campion Properties Limited

6 Reliance Big TV Limited

7 Reliance Tech Services Private Limited

8 Reliance Telecom Limited

9 Reliance Communications Infrastructure Limited

10 Reliance Communications Investment and Leasing Limited

11 Reliance Infratel Limited

12 Netizen Rajasthan Limited

13 Reliance Globalcom BV

14 Reliance Communications (UK) Limited

15 Reliance Communications (Hong Kong) Limited

16 Reliance Communications (Singapore) Pte. Limited

17 Reliance Communications (New Zealand) Pte. Limited

18 Reliance Communications (Australia) Pty. Limited

19 Anupam Global Soft (U) Limited

20 Gateway Net Trading Pte. Limited

21 Reliance Globalcom Limited

22 FLAG Telecom Singapore Pte. Limited

23 FLAG Atlantic UK Limited

24 Reliance FLAG Atlantic France SAS

25 FLAG Telecom Taiwan Limited

26 Reliance FLAG Pacific Holdings Limited

27 FLAG Telecom Group Services Limited

28 FLAG Telecom Deutschland GmbH

29 FLAG Telecom Hellas AE

30 FLAG Telecom Asia Limited

31 FLAG Telecom Nederland BV

32 Reliance Globalcom (UK) Limited

33 Yipes Holdings Inc.

34 Reliance Globalcom Services Inc.

35 YTV Inc.

36 Reliance Infocom Inc.

37 Reliance Communications Inc.

38 Reliance Communications International Inc.

39 Reliance Communications Canada Inc.

40 Bonn Investment Inc.

41 FLAG Telecom Development Limited

42 FLAG Telecom Development Services Company LLC

43 FLAG Telecom Network Services Limited

44 Reliance FLAG Telecom Ireland Limited

45 FLAG Telecom Japan Limited

46 FLAG Telecom Ireland Network Limited

47 FLAG Telecom Network USA Limited

48 FLAG Telecom Espana Network SAU

49 Reliance Vanco Group Limited

50 Euronet Spain SA

51 Net Direct SA (Properietary) Limited (Under liquidation)

52 Vanco (Shanghai) Co. Limited

53 Vanco (Asia Pacific) Pte. Limited

54 Vanco Australasia Pty. Limited

55 Vanco EpE

56 Vanco Sp Zoo

57 Vanco Euronet Sro (Under liquidation)

58 Vanco Gmbh

59 Vanco Japan KK

60 Vanco Net Direct Limited, Ireland (Struck off w.e.f. April 8, 2011)

61 Vanco NV

62 Vanco SAS

63 Vanco South America Ltda

64 Vanco Srl

65 Vanco Sweden AB

66 Vanco Switzerland AG

67 Vanco Deutschland GmbH

68 Vanco BV

69 Vanco Benelux BV

70 Vanco UK Limited

71 Vanco International Limited

72 Vanco Row Limited

73 Vanco Global Limited

74 WANcom Gmbh

75 VNO Direct Limited

76 Vanco US LLC

77 Vanco Solutions Inc

78 Reliance WiMAX World BVI

79 Reliance WiMAX World BV

80 Reliance WiMAX World Limited

81 Reliance WiMAX World LLC

82 Reliance WiMAX Congo Brazzaville BV

83 Interconnect Brazzaville S. A.

84 Reliance WiMAX Guinea BV

85 Acess Guinea SARL

86 Reliance WiMAX Sierra Leone BV

87 Equatorial Communications Limited

88 Reliance WiMAX Cameroon BV

89 Equatorial Communications SARL

90 Reliance WiMax D.R.C. BV

91 Reliance WiMax Gambia BV

92 Reliance WiMax Mauritius BV

93 Reliance WiMax Mozambique BV

94 Reliance WiMax Niger BV

95 Reliance WiMax Zambia BV

96 Access Bissau LDA

97 Reliance Mobile Commerce Limited (w.e.f December 6, 2010)

98 Seoul Telenet Inc. (Board Control)

99 FLAG Holdings (Taiwan) Limited (Board Control)

100 Reliance Telecom Infrastructure (Cyprus) Holdings Limited (Board Control)

101 Lagerwood Investments Limited (Board Control)

102 Flag Pacific Limited (Upto March 25, 2011)

103 FLAGWEB Limited (Upto March 25, 2011)

104 Flag Telecom Servizi Italia SpA (Upto January 21, 2011)

105 Flag Telecom Belgium Network SA (Upto March 29, 2011)

106 FLAG Telecom Taiwan Services Limited (Upto October 18, 2010)

107 RCOM Malaysia SDN.BHD (Upto March 29, 2011)

108 Vanco Aps (Upto March 29, 2011)

109 Vanco Hongkong Solutions Limited (Upto March 29, 2011)

110 Yipes Systems Inc. (Upto March 25, 2011)

111 FLAG Access India Private Limited, India (Upto March 23, 2011)

112 Vanco Net Direct Limited, UK (Upto March 29, 2011)

113 Matrix Innovations Limited (Upto April 1, 2010)

114 Reliance Global IDC Limited (Upto January 1, 2011)

115 Global Innovative Solutions Private Limited (Upto April 1, 2010)

Joint Venture

116 Alcatel Lucent Managed Solutions India Private Limited

Holding Company

117 Reliance Innoventures Private Limited

Individuals Promoters

118 Shri Anil D. Ambani, the person having control during the year

Key Managerial Personnel

119 Shri Hasit Shukla

B List of Other Related Parties where there have been transactions Associate Companies

1 Warf Telecom International Private Limited

2 Mumbai Metro Transport Private Limited

Fellow Subsidairies

3 Reliance Capital Limited

4 Reliance General Insurance Company Limited

Disclosure in respect of transactions, which are more than 10% of the total transactions of the same type with a related party during the year ended March 31, 2011

1 Fixed assets acquired during the year include Rs. 34.28 crore from Reliance Tech Services Private Limited, Rs. 31.65 crore from Reliance Infratel Limited and Rs. 27.82 crore from Alcatel Lucent Managed Solutions India Private Limited, a JV (Previous year - Fixed assets acquired include Rs. 38.97 crore from Reliance Tech Services Private Limited and Rs. 238.94 crore from Reliance Infratel Limited. The Company transferred fixed assets pertaining to passive infrastructure of Rs. 452.19 crore and Capital Work-in-Progress of Rs. 436.89 crore to Reliance Infratel Limited).

2 Loans and Advances include loans granted during the year of Rs. 5,944.99 crore to Reliance Communications Infrastructure Limited, Rs. 230.51 crore to Reliance Webstore Limited, Rs. 479.88 crore to Reliance Big TV Limited, Rs. 69.25 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 144.49 crore to Reliance Tech Services Private Limited, Rs. 21,291.04 crore to Reliance Telecom Limited, Rs. 26.66 crore to Campion Properties Limited, Rs. 326.11 crore to Reliance Infratel Limited and repaid /adjusted during the year Rs. 6,033.12 crore by Reliance Communications Infrastructure Limited, Rs. 23,394.91 crore by Reliance Telecom Limited, Rs. 3,549.35 crore by Reliance Infratel Limited, Rs. 125.01 crore by Reliance Tech Services Private Limited, Rs. 208.98 crore by Reliance Infocomm Infrastructure Private Limited, Rs. 206.70 crore by Reliance Webstore Limited and Rs. 429.31 crore by Reliance Big TV Limited (Previous year - Loans and Advances include, loan granted Rs. 15,496.03 crore to Reliance Communications Infrastructure Limited, Rs. 137.18 crore to Reliance Webstore Limited, Rs. 802.66 crore to Reliance Infratel Limited, Rs. 326.13 crore to Reliance Big TV Limited, Rs. 56.37 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 57.24 crore to Reliance Tech Services Private Limited, Rs. 25,485.59 crore to Reliance Telecom Limited, Rs. 23.80 crore to Campion Properties Limited and repaid during the year Rs. 15,506.48 crore by Reliance Communications Infrastructure Limited, Rs. 289.82 crore by Reliance Webstore Limited, Rs. 195.08 crore by Reliance Big TV Limited, Rs. 29,794.00 crore by Reliance Telecom Limited, Rs. 1,835.69 crore by Reliance Infratel Limited, Rs. 45.60 crore by Reliance Tech Services Private Limited, Rs.10.14 crore by Gateway Net Trading Pte. Limited and Rs. 278.30 crore by Reliance Infocomm Infrastructure Limited).

3 Sundry Debtors include Rs. 276.93 crore from Reliance Communications Inc., Rs. 12.95 crore from Reliance Flag Atlantic France SAS Rs. 115.2 crore from Reliance Communications Infrastructure Limited, Rs. 20.20 crore from Reliance Communications International Inc., Rs. 2.08 crore from Reliance Communications Canada Inc., Rs. 31.33 crore from Reliance Telecom Limited, Rs. 48.46 crore from Reliance Big TV Limited , Rs. 10.51 crore from Reliance Webstore Limited. (Previous year - Sundry Debtors include Rs. 303 crore from Reliance Communications, Inc., Rs. 14.20 crore from Reliance Flag Telecom Ireland Network Limited, Rs. 46.08 crore from Reliance Communications Infrastructure Limited, Rs. 42.43 crore from Reliance Communications International Inc., Rs. 0.94 crore from Reliance Communications Canada Inc., Rs. 92.20 crore from Reliance Telecom Limited, Rs. 24.65 crore from Reliance Big TV Limited and Rs. 21.69 crore from Reliance Webstore Limited).

4 Loans include Rs. 319.45 crore to Reliance Big TV Limited, Rs. 1,529.36 crore to Reliance Communications Infrastructure Limited, Rs. 405.64 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 332.05 crore to Reliance Webstore Limited, Rs. 7.20 crore to Netizen Rajasthan Limited, Rs. 1,467.21 crore to Reliance Telecom Limited, Rs. 141.28 crore to Campion Properties Limited, Rs. 2,718.94 crore to Reliance Infratel Limited, Rs. 34.74 crore to Reliance Tech Services Private Limited and Advances include Rs. 1,430.51 crore to Reliance Communications Infrastructure Limited, Rs. 70.39 crore to Reliance Big TV Limited and Rs. 0.36 crore to Reliance Communications Investment and Leasing Limited (Previous year - Loans includeRs. 268.87 crore to Reliance Big TV Limited, Rs. 1,617.49 crore to Reliance Communications Infrastructure Limited, Rs. 545.37 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 308.24 crore to Reliance Webstore Limited, Rs. 7.20 crore to Netizen Rajasthan Limited, Rs. 3,571.08 crore to Reliance Telecom Limited, Rs. 114.62 crore to Campion Properties Limited, Rs. 5,942.18 crore to Reliance Infratel Limited, Rs. 15.27 crore to Reliance Tech Services Private Limited and Advances includes Rs. 1,425.88 crore to Reliance Communications Infrastructure Limited).

5 Sundry Creditors include Rs. 107.59 crore to Reliance Flag Atlantic France SAS, Rs. 3,211.96 crore to Reliance Infratel Limited, Rs. 53.34 crore to Reliance Communications (UK) Limited, Rs. 55.17 crore to Reliance Tech Services Private Limited, Rs. 3.63 crore to Reliance Infocom Inc., Rs. 79.48 crore to Alcatel Lucent Managed Solutions India Private Limited, a JV and Rs. 34.13 crore to Reliance Infocomm Infrastructure Private Limited (Previous year - Sundry Creditor includeRs. 40.63 crore to Reliance Flag Atlantic France SAS, Rs. 1,036.00 crore to Reliance Infratel Limited, Rs. 25.84 crore to Reliance Communications (UK) Limited, Rs. 18.24 crore to Reliance Tech Services Private Limited, Rs. 3.72 crore to Reliance Infocom Inc, Rs.8.37 crore to Gateway Net Trading Pte. Limited Rs. 20.31crore to Reliance Infocomm Infrastructure Private Limited, Rs. 63.66 crore to Alcatel Lucent Managed Solutions India Private Limited, a JV). Sundry Creditors also include Rs. 217.30 crore to Reliance Infratel Limited for availing passive infrastructure services for 3G Operations.

6 Turnover includes Rs. 845.40 crore from Reliance Communications Infrastructure Limited, Rs. 488.27 crore from Reliance Communications Inc., Rs. 71.39 crore from Reliance Communications International Inc., Rs. 19.21 crore from Reliance Webstore Limited, Rs. 17.39 crore from Reliance Flag Atlantic France SAS, Rs. 4.64 crore from Reliance Communications Canada Inc., Rs. 21.59 crore from Reliance Big TV Limited and Rs. 666.21 crore from Reliance Telecom Limited (Previous year - Turnover includes Rs. 596.35 crore from Reliance Communications Infrastructure Limited, Rs. 342.37 crore from Reliance Communications Inc., Rs. 111.41 crore from Reliance Communications International Inc., Rs. 42.47 crore from Reliance Webstore Limited, Rs. 15.10 crore from Flag Telecom Ireland Network Limited, Rs. 4.05 crore from Reliance Communications Canada Inc., Rs. 21.51 crore from Reliance Big TV Limited and Rs. 462.52 crore from Reliance Telecom Limited).

7 Other Income includes Sale of Capital inventories of Rs. 94.97 crore to Reliance Webstore Limited (Previous year -Rs. Nil)

8 Expenditure includes Access Charges: Rs. 125.87 crore to Reliance Communications Inc., Rs. 240.43 crore to Reliance Telecom Limited. Network Operation Expenses: Rs. 4,679.52 crore to Reliance Infratel Limited. Rs. 78.47 crore to Flag Atlantic France SAS, Rs. 4.44 crore to Reliance Communications Infrastructure Limited and Rs. 27.71 crore to Reliance Communications (UK) Limited and Rs. 174.29 crore to Alcatel Lucent Managed Solutions India Private Limited, a JV Selling and Marketing expenses: Rs. 150.81 crore to Reliance Communications Infrastructure Limited and Rs. 117.02 crore to Reliance Webstore Limited. General and Administrative Expenses: Rs. 225.89 crore to Reliance Communications Infrastructure Limited, Rs. 40.57 crore to Reliance Infocomm Infrastructure Private Limited and Rs. 21.12 crore to Reliance Tech Services Private Limited. (Previous year - Expenditure include Access Charges: Rs. 149.38 crore to Reliance Communications Inc., Rs. 137.87 crore to Reliance Telecom Limited. Network Operation Expenses: Rs. 4,946.47 crore to Reliance Infratel Limited, Rs. 67.18 crore to Reliance Flag Atlantic France SAS, Rs. 6.86 crore to Reliance Communications Infrastructure Limited and Rs. 17.69 crore to Reliance Communications (UK) Limited. Selling and Marketing expenses: Rs. 132.45 crore to Reliance Communications Infrastructure Limited, Rs. 142.06 crore to Reliance Webstore Limited. General and Administrative Expenses: Rs. 195.33 crore to Reliance Communications Infrastructure Limited, Rs. 51.19 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 18.04 crore to Reliance Tech Services Private Limited, Rs. 154.26 crore to Alcatel Lucent Managed Solutions India Private Limited, a JV. Rs. 23.09 crore to Reliance General Insurance Company Limited. Rent, Rates and Taxes: Rs. 2.63 crore to Reliance Capital Limited).

9 Expenditure under the heads Provision for Salaries Cost, Selling and Distribution, General and Administration and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, Reliance Infratel Limited and Reliance Big TV Limited (Refer Note 26, Schedule Q).

10 Financial Guarantee issued includes Rs. 69.80 crore to Reliance Globalcom BV (Previous year - Rs. 69.80 crore to Reliance Globalcom BV).

11 Corporate Guarantee issued includes Rs. 188.64 crore to Reliance Infratel Limited, Rs. 79.92 crore to Gateway Net Trading Pte. Limited, Rs. 749.38 crore to Reliance Telecom Limited and Rs. 93.83 crore to Reliance Big TV Limited (Previous year - Corporate Guarantee issued include Rs. 934.28 crore to Reliance Infratel Limited, Rs. 330.18 crore to Gateway Net Trading Pte. Limited, Rs. 949.25 crore to Reliance Telecom Limited).

12 Finance Charges includes Rs. 594.63 crore received from Reliance Infratel Limited, and Rs. 47.84 crore from Reliance Telecom Limited (Previous year - Finance Charges include Rs. 326.20 crore from Reliance Infratel Limited and Rs. 230.96 crore from Reliance Telecom Limited, Rs. 6.03 crore to Reliance Webstore Limited).

13 Interest Receivable includes Rs. 670.27 crore from Reliance Infratel Limited and Rs. 47.84 crore from Reliance Telecom Limited (Previous year -Interest Receivable include Rs. 326.20 crore from Reliance Infratel Limited and Rs. 230.96 crore from Reliance Telecom Limited)

14 Investments include conversion of Loans into Preference Shares during the year Rs. 2,500 crore of Reliance Infratel Limited and conversion of Preference Shares of Rs. 2,275.66 crore of Reliance Globalcom BV into Equity Shares. Redemption of Preference Shares during the year includes Rs. 1,527.68 crore of Reliance Globalcom BV and Rs. 763.67 crore of Reliance Globalcom Limited Bermuda. (Previous year Investments include Rs. 1,500 crore of adjustment of Loans into Preference Shares of Reliance Infratel Limited and Rs. 100 crore purchased of Reliance Wimax Limited. Redemption of Preference Shares include Rs. 791.90 crore of Reliance Globalcom BV, Rs. 126.80 crore of Gateway Net Trading Pte. Limited and Rs. 148.09 crore of Reliance Globalcom Limited, Bermuda).

15 Unearned income includes Rs. 14.94 crore from Flag Telecom Ireland Network Limited and Rs. 3.56 crore from Reliance FLAG Atlantic France SAS (Previous year- Unearned Income includes Rs. 15.82 crore from Flag Telecom Ireland Network Limited and Rs. 2.97 crore from Reliance FLAG Atlantic France SAS).

16 Prepaid expense includes Rs. 10.39 crore from Reliance FLAG Atlantic France SAS (Previous year-Prepaid expenses includes Rs. 11.77 crore from Reliance FLAG Atlantic France SAS).

17 Refer Note 5, Schedule Q relating to the Scheme of Amalgamation of GISPL, Wholly a Owned Subsidiary with the Company.

Mar 31, 2010

1 Previous Year

Figures of the previous year have been regrouped and reclassified, wherever required. Previous years figures are not comparable with that of the current year on account of the effects of the Schemes considered in the previous year.

2 Foreign Currency Convertible Bonds (FCCBs)

(i) The Company issued FCCBs in two tranches; 5,00,000 FCCBs for 5 Years, 4.65%, USD 500 million issued on 9th May, 2006 and 10,000 FCCBs for 5 Years, 4.95%, USD 1000 million issued on 28th February, 2007. Pursuant to the exercise of an option by the FCCB Holders and in accordance with the terms and conditions thereof, the Company, during an earlier year, allotted 1,87,44,801 fully paid Equity Shares of Rs. 5 each at a pre determined premium of Rs. 475.68 per share against 2,03,051 FCCBs and 6,67,090 fully paid Equity Shares of Rs. 5 each at a pre determined premium of Rs. 656.23 per share against 100 FCCBs respectively.

(ii) During the year, the Company has bought back and cancelled 297 nos. (Previous year 350 nos.) of 5 Year, 4.95%, FCCBs of the face value of USD 1,00,000 each, as per approval of the Reserve Bank of India, at a discount to the face value. This has resulted in a saving of Rs. 24.49 crore (Previous year Rs. 79.61 crore) which has been reflected as part of Other Income. Consequent upon such buy back and cancellation, the Companys obligations to convert the said Bonds into Shares, if so claimed by the Bond Holders and/ or to redeem the same in foreign currency, has come to an end vis-ÃÂ -vis the cancelled Bonds. Rs. 14.48 crore (Previous year Rs. 7.68 crore) being provision for premium on redemption relatable to such cancelled Bonds has been reversed on buyback and cancellation of FCCBs.

Out of total FCCBs issued, 2,96,949 (Previous year 2,96,949) FCCBs and 9,253 (Previous year 9,550) FCCBs from the respective tranches were outstanding as on 31st March, 2010.

(iii) In the event, these outstanding FCCBs are fully converted into Equity Shares, the Equity Share Capital of the Company would increase by approximately 8.91 crore (Previous year 9.11 crore) Equity Shares of Rs. 5 each.

(iv) In case of the above mentioned FCCBs, on and at anytime after 9th May, 2009 and 28th February, 2010 respectively, on and prior to the maturity date, the Company may, subject to certain terms and conditions as per the offering memorandum, redeem the FCCBs in whole and not in part at their Early Redemption amount, provided that no such redemption may be made unless the aggregate value (as defined in the terms and conditions) on each trading day during the period of not less than 30 consecutive trading days, ending not earlier than 14 days prior to the date upon which notice of such redemption is given, was at least 130 percent of the Early Redemption amount.

(v) FCCBs amount includes Rs. 942.32 crore (Previous year Rs. 733.62 crore), being the premium on redemption of FCCBs computed on pro rata basis for the period up to 31st March, 2010.

3 Foreign Exchange

In accordance with an amendment to Schedule VI of the Companies Act, 1956 ("the Act") and in line with the Accounting Standard ("AS") 11, "The Effect of Changes in Foreign Exchange Rates", the Company continues the policy of accounting for the changes in the amounts of loans/ liabilities relating to Fixed Assets, consequent to changes in foreign exchange rates, as profit or loss of the Company for the year in which the changes take place without adjusting the amount of the change in the cost of fixed assets.

The net gain of Rs. 1,572.16 crore (Previous year Rs. 119.57 crore) including gain of Rs. 21.98 crore (Previous year Rs. 32.76 crore) on account of conversion of overseas bank balances and Rs. 2,126.92 crore relating to loans/ liabilities (Previous year foreign exchange loss of Rs. 4,464.57 crore relating to loans/ liabilities which was debited to Profit and Loss Account and withdrawn from the General Reserve of the Company in accordance with the terms of the Schemes of Arrangement, leaving no impact vis-ÃÂ -vis profit of the year ended 31st March, 2009) have been reflected in "Financial Charges (net)" as the effect of Foreign Currency Exchange Fluctuation in Profit and Loss Account.

During the year, loss of Rs. Nil (Previous year Rs. 139.03 crore) arising out of marking related Derivative Contracts to market has also been recognised in the Profit and Loss Account, in compliance with the announcement dated 29th March, 2008 by The Institute of Chartered Accountants of India (ICAI) regarding Accounting for Derivatives. As a measure of prudence, the Company has decided that, unlike in earlier years, not to recognise any mark to market gains in respect of any outstanding class of derivative contracts related to loans, liabilities and assets expressed in foreign currency. Accordingly, the Company has not recognised gain of Rs. 34.30 crore on mark-to-market valuation of derivative contracts outstanding as at the end of the year. If the Company had not made this change of policy, net profit after tax would have been higher by an amount of Rs. 34.30 crore for the year.

4 Schemes of Amalgamation and Arrangement of earlier years

The Company, during the past years, undertook various Schemes including restructuring of ownership structure of telecom business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of Amalgamation and Arrangement ("the Schemes") under Sections 391 to 394 of the Companies Act, 1956 approved by the Honble High Court of respective judicature, the Company, during the respective years, recorded all necessary accounting effects, along with requisite disclosure in the notes to the accounts, in accordance with the provisions of the said Schemes. The cumulative effects of the Schemes in case of Equity Share Capital of the Company have been disclosed below the respective Schedule to the Accounts. Reserves, pursuant to the said Schemes, include:

(i) Rs. 9,171.93 crore, being Securities Premium Account, which was part of the Security Premium of erstwhile Reliance Infocomm Limited (RIC), the transferor company.

(ii) General Reserve I of Rs. 5,538.00 crore representing the unadjusted balance being the excess of assets over liabilities relatable to Telecommunications Undertaking transferred and vested into the Company.

(iii) General Reserve II of Rs. 2,785.21 crore representing the unadjusted balance of the excess of assets over liabilities received by the Company relatable to Telecommunications Undertaking transferred and vested into the Company.

(iv) During the year, General Reserve III and General Reserve IV representing opening balances of Rs. 4,335.43 crore and Rs. 27,030.86 crore respectively have been combined as General Reserve III. General Reserve III includes an amount of Rs. 25,854.38 crore (Previous year Rs. 27,030.86 core) pursuant to transfer of assets and liabilities and write off of investment of Rs. 2,096.43 crore, in accordance with the Scheme, for cancellation of investment in erstwhile Reliance Gateway Net Limited (RGNL) and net effect on fair valuation of assets and liabilities of the Company of Rs. 12,698.18 crore.

(v) Reserve for Business Restructuring of Rs. 1,287.10 crore representing the unadjusted balance of revaluation of investment in Reliance Communications Infrastructure Limited, the holding company of Reliance Infratel Limited (RITL) after withdrawing an amount equivalent to writing off of Passive Infrastructure assets, transferred to RITL, to the Profit and Loss Account. Balance in Reserve for Business Restructuring shall be available to meet the increased depreciation, costs, expenses and losses, including on account of impairment of or write down of assets etc.

(vi) Additional depreciation arising on fair value of the assets has been adjusted from Provision for Business Restructuring.

(vii) The Company incorporated the effects of the Scheme, for demerger of Optic Fiber Undertaking into Reliance Infratel Limited, in the accounts of the previous year ended 31st March, 2009, then pending the filing of the Order of the Honble High Court, sanctioning the Scheme, with the Registrar of Companies (RoC) as required by Section 394 (3) of the Companies Act, 1956. The said Order was filed with RoC on 15th September, 2009. Consequently, the Scheme had become effective.

5 Depreciation on Electronic Equipments

During the year, the Company carried out technical/ technology assessment to determine the useful life of some of its telecommunication equipments. The useful life of such telecommunication equipments has been re-assessed and ascertained as 18 years, impacting the provision for depreciation of these assets for the year ended on 31st March, 2010. As a result, depreciation charge is lower and profits for the year are higher by Rs. 771.00 crore for the year. The accounting treatment so determined is fully in accordance with the applicable provisions of the Companies Act, 1956.

6 Provisions

(i) Provisions include, provision for disputed claims of verification of customers Rs. 9.04 crore (Previous year Rs.9.04 crore) and others of Rs. 1,650.88 crore (Previous year Rs. 1,835.76 crore) and Provision for Commission to Non Executive Directors of Rs. 0.60 crore (Previous year Rs. 0.60 crore).

(ii) During the year, an amount of Rs. 140.00 crore (Previous year Rs. Nil) relating to Roll out obligations, Rs. Nil (Previous year Rs. 4.40 crore) relating to commission to Non Executive Directors and Rs. 50.52 crore (Previous year Rs. Nil) relating to disputed liablities have been reversed. An amount of Rs. 5.64 crore (Previous year Rs. Nil) has been provided towards disputed interconnect usage charges and an amount of Rs. Nil (Previous year Rs. 31.18 crore) has been reversed out of disputed interconnect usage charges. An amount of Rs. Nil (Previous year Rs. 29.22 crore), was paid towards disputed liablities and an amount of Rs. 0.60 crore (Previous year Rs. 30.60 crore) was paid towards commission to Non Executive Directors.

(iii) On determination by the Board of Directors, the liability against provision for commission to Non Exucutive Directors will be paid during the year 2010-11.

(iv) Also refer Note 2 (v) above.

The aforesaid provisions shall be utilised on settlement of the claims, if any, there against.

7 Contingent Liabilities and Capital Commitment (As represented by the Management)

(Rs. in crore)

As at As at 31st March, 2010 31st March, 2009

(i) Estimated amount of contracts remaining to be executed on capital 220.22 651.15 accounts (net of advances) and not provided for

(ii) Disputed Liabilities in Appeal

- Sales Tax and VAT 52.05 13.76

- Excise and Service Tax 2.08 2.08

- Entry Tax and Octroi 1.55 1.18

- Other Litigations 0.30 0.40

(iii) Guarantees given by the Company on behalf of its Subsidiaries 2,536.64 5,741.28

(iv) Guarantees given by the Company on behalf of other companies for 461.99 145.97 business purpose

8 Deferred Tax Assets and Liabilities

The Company being in the business of Telecommunication Services, Broadband Network and Internet Services, are eligible for deduction under Section 80IA (Tax Holiday) of the Income Tax Act, 1961. Since the Deferred Ta x Liability in respect of timing difference is expected to reverse during Ta x Holiday Period, the same is not recognised in books of accounts as at 31st March, 2010 as per the Accounting Standard ("AS") 22 of "Accounting for Taxes on Income" as referred to in Accounting Standard Rules. Following the principle of prudence, the Company has not recognised Defered Ta x Asset in respect of debits for equalised lease rentals.

9 Operating Lease

The Companys significant leasing arrangements are in respect of operating leases for premises and network sites. These lease agreements provide for cancellation by either parties thereto as per the terms and conditions of the agreements. The Company has been the lessee in respect of Optic Fibres and in respect of this lease, lease rent of Rs. 1,141.00 crore, (Previous year Rs. 903.00 crore) including Rs.1,129.00 crore (Previous year Rs. 893.00 crore) not leviable for the year as per the lease agreement, has been recognised on a straight line basis as Network Expenses and corresponding amount is included in Sundry Creditors.

10 Export Commitments

The Company has obtained Licences/ authorisations under the Export Promotion Capital Goods (EPCG) Scheme for importing capital goods at a concessional rate of customs duty against submission of bonds. Under the terms of the respective Licences/ authorisations, the Company is required to export goods of FOB value equivalent to or more than, eight times the amount of duty saved in respect of such Licences/ authorisations, where export obligation has been refixed by the order of Director General Foreign Trade, Ministry of Commerce and Industry, Government of India, as applicable.Balance export obligations outstanding as on 31st March, 2010 under the aforesaid Licences/ authorisations is Rs. 494.40 crore (Previous year Rs. 775.00 crore).

11 Segment Performance

Disclosure as per Accounting Standard ("AS") 17 "Segment Reporting" is reported in Consolidated Accounts of the Company. Therefore, the same has not been separately disclosed in line with the provisions of AS.

12 Employee Benefits

Gratuity : In accordance with the applicable Indian laws, the Company provides for gratuity, a defined benefit retirement plan (Gratuity Plan) for all its employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employees last drawn salary and for the years of employment with the Company.

13 Employee Stock Option Scheme

The Company operates two Employee Stock Option Plans; ESOS Plan 2008 and ESOS Plan 2009, which cover eligible employees of the Company, the Holding Company and its Subsidiaries. ESOS Plans are administered through an ESOS Trust. The vesting of the options is on the expiry of one year from the date of grant as per Plan under the respective ESOS(s). In respect of Options granted, the accounting value of Options (based on market price of the share on the date of the grant of the option) is accounted as deferred employee compensation, which is amortised on a straight line basis over the vesting period. Each Option entitles the holder thereof to apply for and be allotted/ transferred one Equity Share of the Company of Rs. 5 each upon payment of the exercise price during the exercise period. The maximum exercise period is 10 years from the date of grant of options.

The Company has established a Trust for the implementation and management of ESOS for the benefit of its present and future employees. Advance of Rs. 331.16 crore (Previous year Rs.159.00 crore) has been granted to the Trust. Rs. 331.00 crore (Previous year Rs. 154.91 crore) has been utilised by the Trust for purchasing 1.67 crore (0.92 crore) Equity Shares during the period upto 31st March, 2010.

14 Exceptional Items

Exceptional Items consist of write back of charges of Rs.6.65 crore (Previous year a charge of Rs. 7.47 crore) of Options which have lapsed under ESOS Plan 2008 as mentioned in Note 23 above and Stamp Duty of Rs. 25.00 crore paid by the Company on conveyancing of the assets pursuant to the Schemes approved during the year by the Honble High Court. Exceptional Items during the previous year ended on 31st March, 2009 included Rs. 404.03 crore relatable to the period ended upto 31st March, 2008, being the difference arising on restating, on the basis of closing rate of foreign currency as at 31st March, 2009, the foreign currency denominated Redeemable Preference Shares of its subsidiaries Reliance Globalcom BV (RGBV) and Gateway Net Trading Pte. Limited as required by Accounting Standard ("AS") 11 "Effects of changes in foreign exchange rates" and Rs. 3,063.27 crore, being the Profit on transfer of OFC Undertaking under the Scheme of Arrangement.

15 Recovery of Expenses

Expenses under the heads Provision for Employees Cost and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited (RCIL), a Wholly Owned Subsidiary of the Company. Such amounts recovered for the year amount to Rs. 116.86 crore (Previous year Rs. 133.05 crore) for Employee Cost and Rs. 506.91crore (Previous year Rs.500.28 crore) for Sales and General Administrative Expenses comprising of Rs. 81.00 crore (Previous year Rs. 87.50 crore) for Advertising Expenses, Rs. 339.62 crore (Previous year Rs. 332.10 crore) for Customer Acquisition and Customer Care, Rs.86.29 crore (Previous year Rs. 80.68 crore) for Hire charges. Similarly, the amount recovered from Reliance Infratel Limited (RITL), a subsidiary of RCIL for the year includes Rs. 17.75 crore (Previous year Rs. Nil) for Employee Cost and Rs. 35.76 crore (Previous year Rs. Nil) for Sales and General Administration Expenses. The Company has also collected interest, equivalent to its cost of funds, from Reliance Communications Infrastructure Limited Rs. Nil (Previous year Rs. 116.72 crore), Reliance Infratel Limited and Reliance Telecom Limited amounting to Rs. 250.55 crore (Previous year Rs. Nil) and Rs. 230.96 crore (Previous year Rs. 445.17 crore) respectively for the year ended 31st March, 2010.

16 Licence Fees

The Company accounts for its liabilities in respect of Licence Fees payable by way of Revenue Share to be computed on the Gross Revenue of the Company after taking into account the decision of the Telecom Disputes Settlement And Appellate Tribunal (the TDSAT) dated 30th August, 2007 specifying that revenues not related to UAS and Other Licences under which the Company operates are not to be included in the computation of Revenue Share. The TDSAT has, by its decision dated 26th March, 2009 applied the said decision dated 30th August, 2007 to the Company. The decision of the TDSAT is the subject matter of Appeal pending before the Supreme Court. No provision is considered necessary in this regard.

17 Special Audit

Pursuant to the Telecom Licence Agreement, the Department of Telecommunications (DoT) directed audits of various Telecom companies including of the Company. The Special Auditors appointed by DoT were required to verify records of the Company and some of its subsidiaries for the years ended 31st March, 2007 and 31st March, 2008 relating to Licence fees and revenue share. The report of the Special Auditors alleging a shortfall of Licence fee and revenue share of Rs.316.00 crore is mala fide and is in the Companys opinion biased and full of errors and inaccuracies. Criminal complaints filed by the Company against the wrongful leaking of the Report are being investigated by the Police. The Institute of Chartered Accountants of India (ICAI) is investigating the professional and other misconduct of the Special Auditors. The Company has also made presentations and representations to DoT on the observations of the Special Auditor. The Company is advised that based inter alia on current understanding of the regulation by the industry and judicial pronouncements directly applicable to the issues raised in the Special Audit report, all of which have not been properly considered nor appreciated in the Report, no provision is required in the accounts of the Company.

18 Financial Statements of Subsidiary Companies

The Ministry of Corporate Affairs, Government of India vide its letter No.47/60/2010-CL-III dated 7th May, 2010 issued under Section 212 (8) of the Companies Act, 1956 has exempted the Company from attaching the Balance Sheets, Profit and Loss Accounts, Cash Flow Statements and other documents of its subsidiaries under Section 212(1) of the Companies Act, 1956. As per the approval, key details of each subsidiary are attached.

19 Related Parties

As per Accounting Standard ("AS") 18, "Related Party Disclosures" prescribed under the Accounting Standard Rules, the disclosure of transactions with the related parties are given below.

A List of Related Parties: where control exists

Sr. Name of the Subsidiary Companies No. (direct and step down subsidiaries)

1 Reliance Communications Infrastructure Limited

2 Reliance Telecom Limited

3 Reliance Infocomm Infrastructure Private Limited

4 Reliance Digital Home Services Limited

5 Reliance WiMax Limited

6 Reliance Global IDC Limited

7 Reliance Webstore Limited

8 Campion Properties Limited

9 Reliance Mobile Limited (upto 23rd March, 2010)

10 Reliance Infratel Limited

11 Matrix Innovations Limited

12 Reliance Communications Investment and Leasing Limited

13 Netizen Rajasthan Limited

14 FLAG Access India Private Limited

15 Reliance Tech Services Private Limited

16 Reliance Big TV Limited

17 Reliance Globalcom B.V.

18 Gateway Net Trading Pte. Limited

19 Reliance Globalcom Limited

20 Reliance FLAG Pacific Holdings Limited

21 FLAG Pacific Limited

22 FLAG Telecom Singapore Pte. Limited

23 FLAG Telecom Development Limited

24 FLAG Telecom Development Services Company LLC

25 FLAGWEB Limited

26 FLAG Telecom Network Services Limited

27 Reliance FLAG Telecom Ireland Limited

28 FLAG Telecom Japan Limited

29 FLAG Telecom Servizi Italia SpA

30 FLAG Telecom Network USA Limited

31 FLAG Telecom Belgium Network SA

32 FLAG Telecom Espana Network SAU

33 FLAG Telecom Group Services Limited

34 FLAG Telecom Asia Limited

35 FLAG Telecom Deutschland GmbH

36 FLAG Telecom Nederland B.V.

37 FLAG Telecom Hellas AE

38 FLAG Atlantic UK Limited

39 Reliance FLAG Atlantic France SAS

40 FLAG Telecom Taiwan Services Limited

41 FLAG Holdings (Taiwan) Limited - Board Control

42 FLAG Telecom Taiwan Limited

43 FLAG Telecom Ireland Network Limited

44 Reliance Communications, Inc.

45 Reliance Communications International, Inc.

46 Reliance Communications Canada, Inc.

47 Bonn Investment, Inc. (formerly Reliance Netway, Inc.)

48 Reliance Communications (UK) Limited

49 Reliance Communications (Hong Kong) Limited

50 Reliance Infocom, Inc.

51 Reliance Communications (Singapore) Pte. Limited

52 Reliance Communications (New Zealand) Pte. Limited

53 Reliance Communications (Australia) Pty. Limited

54 Seoul Telenet, Inc. - Board Control

55 RCOM Malaysia SDN. BHD.

56 Reliance Telecom Infrastructure (Cyprus) Holdings Limited - Board Control

57 Lagerwood Investments Limited - Board Control

58 Reliance Globalcom (UK) Limited

59 Euronet Spain SA

60 Net Direct SA (Proprietary) Limited

61 Vanco (Shanghai) Co. Limited

62 Vanco ApS

63 Vanco (Asia Pacific) Pte. Limited

64 Vanco Australasia Pty. Limited

65 Vanco Benelux B.V.

66 Vanco B.V.

67 Vanco Deutschland GmbH

68 Vanco EpE

69 Vanco Sp Zoo

70 Vanco Euronet Sro

71 Vanco Global Limited

72 Vanco GmbH

73 Reliance Vanco Group Limited

74 Vanco Hong Kong Solutions Limited

75 Vanco International Limited

76 Vanco Japan KK

77 Vanco Net Direct Limited

78 Vanco Net Direct Limited, Ireland

79 Vanco NV

80 Vanco ROW Limited

81 Vanco SAS

82 Vanco Solutions, Inc.

83 Vanco South America Ltda

84 Vanco Srl

85 Vanco Sweden AB

86 Vanco Switzerland AG

87 Vanco UK Limited

88 Vanco US LLC

89 VNO Direct Limited

90 WANcom GmbH

91 Anupam Global Soft (U) Limited

92 Reliance Globalcom Services, Inc.

93 Yipes Holdings, Inc.

94 YTV, Inc.

95 Yipes Systems, Inc.

96 Reliance WiMax World BVI

97 Reliance WiMax World B.V.

98 Reliance WiMax World Limited

99 Reliance WiMax World LLC

100 Reliance WiMax Congo-Brazzaville B.V.

101 Reliance WiMax Guinea B.V.

102 Access Guinea SARL

103 Interconnect Brazzaville S.A.

104 Reliance WiMax Sierra Leone B.V.

105 Equatorial Communications Limited

106 Reliance WiMax Cameroon B.V.

107 Equatorial Communications SARL

108 Reliance WiMax D.R.C. B.V. (w.e.f. 1st April, 2009)

109 Reliance WiMax Gambia B.V. (w.e.f. 21st April, 2009)

110 Reliance WiMax Mauritius B.V. (w.e.f. 1st April, 2009)

111 Reliance WiMax Mozambique B.V. (w.e.f. 21st April, 2009)

112 Reliance WiMax Niger B.V. (w.e.f. 1st April, 2009)

113 Reliance WiMax Zambia B. V. (w.e.f. 1st April, 2009)

114 Access Bissau LDA (w.e.f. 1st April, 2009)

115 Global Innovative Solutions Private Limited (w.e.f. 4th September, 2009)

116 Reliance Gateway Net Limited (upto 13th July, 2009)

Holding Company

117 Reliance Innoventures Private Limited

118 AAA Communication Private Limited (ceased to be the Holding Company w.e.f. 09th October, 2009)

Individuals Promoters

119 Shri Anil D. Ambani, the person having control during the year

Manager

120 Shri Hasit Shukla

B List of Other Related Parties; where there have been transactions

Associate Companies

1 Mumbai Metro Transport Private Limited (w.e.f. 18th January, 2010)

2 Warf Telecom International Private Limited

Fellow Subsidiaries

3 Reliance Capital Limited

4 Reliance General Insurance Company Limited

Disclosure in respect of transactions which are more than 10% of the total transactions of the same type with a related party during the year

1 Fixed assets acquired during the year include Rs.38.97 crore from Reliance Tech Services Private Limited and Rs. 238.94 crore from Reliance Infratel Limited. Also during the year, the Company has transferred fixed assets pertaining to passive infrastructure of Rs. 452.19 crore and Capital Work-in-Progress of Rs. 436.89 crore to Reliance Infratel Limited (Previous year - Fixed assets acquired during the year include Rs. 5.01 crore from Reliance FLAG Atlantic France SAS, Rs. 43.34 crore from Reliance Tech Services Private Limited and Rs. 932.87 crore from Reliance Infratel Limited).

2 Loans and Advances include loan granted during the year of Rs. 15,496.03 crore to Reliance Communications Infrastructure Limited, Rs.137.18 crore to Reliance Webstore Limited, Rs.802.66 crore to Reliance Infratel Limited, Rs.326.13 crore to Reliance Big TV Limited, Rs. 56.37 crore to Reliance Infocomm Infrastructure Private Limited, Rs.57.24 crore to Reliance Tech Services Private Limited, Rs.25,485.59 crore to Reliance Telecom Limited, Rs.23.80 crore to Campion Properties Limited and repaid during the year Rs.15,506.48 crore by Reliance Communications Infrastructure Limited, Rs. 289.82 crore by Reliance Webstore Limited, Rs.195.08 crore by Reliance Big TV Limited, Rs.29,794.00 crore by Reliance Telecom Limited, Rs. 1,835.69 crore by Reliance Infratel Limited, Rs.45.60 crore by Reliance Tech Services Private Limited , Rs.10.14 crore by Gateway Net Trading Pte. Limited and Rs.278.30 crore by Reliance Infocomm Infrastructure Limited. (Previous year - Loans and Advances include loan granted during the year of Rs. 1,554.21 crore to Reliance Telecom Limited, Rs.27,340.47 crore to Reliance Communications Infrastructure Limited, Rs. 890.79 crore to Reliance Webstore Limited, Rs. 31.46 crore to Campion Properties Limited, Rs. 2,543.54 crore to Reliance Infratel Limited, Rs. 206.49 crore to Reliance Big TV Limited, Rs. 793.02 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 71.89 crore to Reliance Tech Services Private Limited and Rs. 6,718.94 crore, as per the Scheme of Arrangement, to Reliance Infratel Limited and repaid during the year Rs. 28,073.13 crore by Reliance Communications Infrastructure Limited, Rs. 1,327.27 crore by Reliance Webstore Limited, Rs. 1,201.36 crore by Reliance Infocomm Infrastructure Private Limited, Rs. 146.78 crore by Reliance Big TV Limited, Rs. 1,780.12 crore by Reliance Telecom Limited, Rs. 2,287.27 crore by Reliance Infratel Limited, Rs.68.25 crore by Reliance Tech Services Private Limited and converted into Equity Shares of Rs. 977.62 crore by Reliance Gateway Net Limited.).

3 Sundry Debtors include Rs.303 crore from Reliance Communications, Inc., Rs.14.20 crore from FLAG Telecom Ireland Network Limited, Rs.46.08 crore from Reliance Communications Infrastructure Limited, Rs.42.43 crore from Reliance Communications International, Inc., Rs.0.94 crore from Reliance Communications Canada, Inc., Rs.92.20 crore from Reliance Telecom Limited, Rs.24.65 crore from Reliance Big TV Limited and Rs.21.69 crore from Reliance Webstore Limited. (Previous year - Sundry Debtors include Rs. 298.53 crore from Reliance Communications, Inc., Rs. 99.67 crore from FLAG Telecom Ireland Network Limited, Rs. 42.28 crore from Reliance Communications Infrastructure Limited, Rs. 61.03 crore from Reliance Communications International, Inc., Rs. 4.57 crore from Reliance Communications Canada, Inc., Rs. 0.20 crore from Reliance WiMax Limited, Rs. 47.96 crore from Reliance Telecom Limited and Rs. 6.94 crore from Reliance Big TV Limited).

4 Loans include Rs.268.87 crore to Reliance Big TV Limited, Rs.1,617.49 crore to Reliance Communications Infrastructure Limited, Rs. 545.37 crore to Reliance Infocomm Infrastructure Private Limited, Rs.308.24 crore to Reliance Webstore Limited, Rs.7.20 crore to Netizen Rajasthan Limited,Rs. 3,571.08 crore to Reliance Telecom Limited,Rs. 114.62 crore to Campion Properties Limited, Rs. 5,942.18 crore to Reliance Infratel Limited, Rs.15.27 crore to Reliance Tech Services Private Limited and Advances include Rs. 1,425.88 crore to Reliance Communications Infrastructure Limited. (Previous year-Advances include Rs. 18.16 crore to Reliance Big TV Limited, Rs. 23.58 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 21.53 crore to Reliance Flag Atlantic France SAS, Rs. 0.08 crore to Reliance Communications Investment and Leasing Limited, Rs. 1,582.78 crore to Reliance Communications Infrastructure Limited,Rs. 6.62 crore to Alcatel-Lucent Managed Solutions India Private Limited, a Joint Venture (JV) and Rs. 20.95 crore to Reliance General Insurance Company Limited).

5 Sundry Creditors include Rs. 40.63 crore to Reliance FLAG Atlantic France SAS, Rs.1,036.00 crore to Reliance Infratel Limited, Rs.25.84 crore to Reliance Communications (UK) Limited, Rs.18.24 crore to Reliance Tech Services Private Limited, Rs.3.72 crore to Reliance Infocom, Inc., Rs. 8.37 crore to Gateway Net Trading Pte. Limited Rs.20.31crore to Reliance Infocomm Infrastructure Private Limited, Rs. 63.66 crore to Alcatel-Lucent Managed Solutions India Private Limited, a JV. (Previous year - Sundry Creditors include Rs. 234.99 crore to Reliance FLAG Atlantic France SAS, Rs. 1,265.36 crore to Reliance Infratel Limited, Rs. 9.95 crore to Reliance Webstore Limited, Rs. 12.43 crore to Reliance Communications (UK) Limited, Rs. 15.87 crore to Reliance Tech Services Private Limited, Rs. 4.15 crore to Reliance Infocom, Inc., Rs. 17.94 crore to Gateway Net Trading Pte. Limited. Rs. 0.47 crore to Reliance Communications, Inc., Rs. 0.63 crore to Reliance Communications International, Inc., Rs. 0.12 crore to Reliance WiMax Limited, Rs. 3.41 crore to Reliance Capital Limited and Rs. 14.61 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 36.88 crore to Alcatel-Lucent Managed Solutions India Private Limited, a JV).

6 Turnover includes Rs.596.35 crore from Reliance Communications Infrastructure Limited, Rs.342.37 crore from Reliance Communications Inc., Rs. 111.41 crore from Reliance Communications, International, Inc., Rs. 42.47 crore from Reliance Webstore Limited, Rs. 15.10 crore from Flag Telecom Ireland Network Limited, Rs.4.05 crore from Reliance Communications Canada, Inc., Rs. 21.51 crore from Reliance Big TV Limited and Rs.462.52 crore from Reliance Telecom Limited. (Previous year - Turnover includes Rs. 476.19 crore from Reliance Communications Infrastructure Limited, Rs. 596.17 crore from Reliance Communications, Inc., Rs. 227.16 crore from Reliance Communications International, Inc., Rs. 76.04 crore from Reliance Webstore Limited, Rs. 22.82 crore from Flag Telecom Ireland Network Limited, Rs. 4.91 crore from Reliance Communications Canada, Inc., Rs. 0.62 crore from Reliance WiMax Limited, Rs. 8.83 crore from Reliance Big TV Limited, Rs. 313.65 crore from Reliance Telecom Limited and Rs. 1.47 crore from Reliance Communications (UK) Limited).

7 Expenditure includes Access Charges: Rs. 149.38 crore to Reliance Communications, Inc., Rs. 137.87 crore to Reliance Telecom Limited, Network Operation Expenses: Rs.4,946.47 crore to Reliance Infratel Limited, Rs. 67.18 crore to Reliance FLAG Atlantic France SAS, Rs.6.86 crore to Reliance Communications Infrastructure Limited and Rs.17.69 crore to Reliance Communications (UK) Limited. Selling and Marketing expenses: Rs.132.45 crore to Reliance Communications Infrastructure Limited, Rs. 142.06 crore to Reliance Webstore Limited. General and Administrative Expenses: Rs. 195.33 crore to Reliance Communications Infrastructure Limited, Rs. 51.19 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 18.04 crore to Reliance Tech Services Private Limited, Rs.154.26 crore to Alcatel-Lucent Managed Solutions India Private Limited, Rs. 23.09 crore to Reliance General Insurance Company Limited. Rent, Rates and Taxes: Rs. 2.63 crore to Reliance Capital Limited. Finance Charges includes Rs. 326.20 crore received from Reliance Infratel Limited, Rs.6.03 crore to Reliance Webstore Limited and Rs.230.96 crore from Reliance Telecom Limited.

Expenditure under the heads Provision for Employees Cost and Other Expenses are net of recoveries for common cost from Reliance Communications Infrastructure Limited, a Wholly Owned Subsidiary of the Company (Refer Note 25, Schedule Q).

(Previous year-Expenditure includes Access Charges: Rs. 83.85 crore to Reliance Communications, Inc., Rs. 91.11 crore to Reliance Telecom Limited. Network Operation Expenses: Rs.2,749.23 crore to Reliance Infratel Limited, Rs. 120.85 crore to Reliance FLAG Atlantic France SAS, Rs. 1.27 crore to Reliance Telecom Limited, Rs.3.92 crore to Reliance Communications Infrastructure Limited and Rs.0.95 crore to Reliance Communications (UK) Limited. Selling and Marketing expenses: Rs. 87.26 crore to Reliance Communications Infrastructure Limited, Rs. 171.04 crore to Reliance Webstore Limited. General and Administrative Expenses: Rs. 171.07 crore to Reliance Communications Infrastructure Limited, Rs. 43.51 crore to Reliance Infocomm Infrastructure Private Limited, Rs. 15.18 crore to Reliance Tech Services Private Limited, Rs.63.38 crore to Alcatel-Lucent Managed Solutions India Private Limited, a JV and Rs.17.20 crore to Reliance General Insurance Company Limited. Professional Fees: Rs. 1.09 crore to Reliance Infocom, Inc. Rent, Rates and Taxes: Rs. 5.87 crore to Reliance Capital Limited. Finance Charges include Rs. 445.17 crore receivable from Reliance Telecom Limited and Rs. 116.72 crore receivable from Reliance Communications Infrastructure Limited).

8 Financial Guarantee issued includes Rs. 69.80 crore to Reliance Globalcom B.V. (Previous year - Rs. 69.80 crore to Reliance Globalcom B.V.).

9 Corporate Guarantee issued includes Rs. 934.28 crore to Reliance Infratel Limited, Rs.330.18 crore to Gateway Net Trading Pte. Limited, Rs. 949.25 crore to Reliance Telecom Limited, (Previous year-Corporate Guarantee issued to the Banks include Rs.102.00 crore for Reliance Telecom Limited, Rs. 3,123.93 crore for Reliance Infratel Limited, Rs. 2,422.20 crore for Gateway Net Trading Pte. Limited).

10 The Company has collected interest, equivalent to its cost of funds, from Reliance Infratel Limited and Reliance Telecom Limited amounting to Rs. 326.20 crore and Rs. 230.96 crore respectively. (Previous year-The Company has collected interest, equivalent to its cost of funds, from Reliance Communications Infrastructure Limited and Reliance Telecom Limited amounting to Rs. 116.72 crore and Rs. 445.17 crore respectively).

Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article