I .There is a charge of ?7 lakhs on 400 D type and 624 E type quarters in favour of Govt, of Karnataka towards subsidy received in terms of Subsidised Industrial housing Scheme.
2. Factory building is on the lease land,measuring 30 kanals for which extension for lease is under process with J&K Government.
3. There is a charge on title of property, plant and equipment, and other assets of the Company in favour of various lenders for an aggregate amount of Rs. 3,60,150.50 lakhs as these assets are pledged as security for liabilities.
4. Non Availability of Title Deeds
Mankapur: Out of 191.03 acres of land purchased from private owners, title deed for 41.77 acres land are not available with the management.
Naini: ITI Complex land (174.69 acres) was handed over by District Industrial Officer in 1969. The title deed of this land is still not transferred in the name of the Company.
Palakkad: Land measuring 77 acres valueing Rs.6,090.31 lakhs has been resumed by Government of Kerala and is under adjudication before Apex Court.
Raebareli: Transfer of title of 196.37 acres of land (factory area) valuing Rs.11620 Lakhs (Appx) acquired against Gazette No 10574(1). SHA.U/18.ll.666/Bha-72 dated 09.01.1973 pertaining to Villages Ballapur, Chhajlapur & Malikmau Aima, Raebareli transfered by Industries Department, Raebareli dated 12.11.1973 is pending due to non submission of proof of compensation paid by ITI Limited to the land owners at the time of land acquirement.
5. Company is in process of reconciling the land (Freehold/leasehold) records held with the records maintained by the Civil Engineering Department (‘Civil’) and by other units. An appropriate coding/cross-refer-
encing system is in the process of development to enable proper correlation between records.
6. The Company was mandated to construct NIFT Building for which M/s. TCIL, (A Government of India Undertaking) was engaged as PMC and the entire construction was given to TCIL. As on March 31,2024,
the entire building was constructed and handed over to NIFT but TCIL had not issued completion certificate for want of certain documents from Local Development Authority. The Company referred this matter to the administrative mechanism for resolving the same on priority. As on March 31,2025, based on the receipt of completion certificate & certain other documents, the entire CWIP pertaining to NIFT building of Rs.6,582.06 (in Lakh) was capitalized & provision for depreciation has been made in the books for the current year.
7. The Company has captialized from CWIP to PPE amounting to Rs. 5,035.08 lakhs pertaining to data centre and other assets pertaining to the Bengaluru plant of the Company.
8. The deletion amount in land includes Rs. 11,941 lakhs which is reclassified as Investment Property during the year.
9. The Company has recognized the sale of a portion of its land and an old building at Electronic City Bengaluru to Centre for Development of Telematics (‘C-Dot’) at an agreed consideration of Rs. 20,000 lakhs
and the consequent profit on sale thereof recognised amounting to Rs.10,919 lakhs, pursuant to an agreement to sell entered by the Company dated February 17, 2025, based on approvals from Department
of Telecommunications, Government of India for such sale. The sale deed in the respect of the above transaction was not executed as at the year end due to certain pending approvals regarding demarcation of the relevant property by the Karnataka Industrial Areas Development Board (‘KIADB’) as at March 31,2025 and subsequent confirmation of demarcation by Electronic City Industrial Township Authority. The Company believes these pending approvals and execution of sale deed is procedural in nature.
10. BBMP has utilized certain property in Bengaluru (in the books of Bengaluru Plant) measuring 1,594.28 sq meters for the formation of the storm water drain. BBMP agreed to pay a compensation of Rs.1,387.34 lakhs. Consequently, Rs 1210.08 lakhs has been recognised as surplus on acquisition of land and a cost of Rs. 177.26 lakhs has been depleted from the asset records.
II .Company is in the process of reconciling/recomputing the gross block and depreciation block details as per the respective asset registers maintained across all units/corporate office.
1. (a) Land measuring 4653.75 sq.metres has been leased to Department of Telecommunications (‘DoT’) for a period of 99 years commencing from October 03,1983.
(b) Formal conveyance/lease deeds in respect of land (excepting part of lands at Bengaluru & Mankapur) are yet to be executed by the respective State Governments.
(c) Land measuring 1256.86 Sq. metres has been leased to DoT for a period of 99 years commencing from July 10,1991.
(d) 3 acres of land is leased to State Government for construction of Mini-Vidhana Soudha for a period of 99 years commencing from March 1994.
2. (a) BSNL Telephone Exchange having area of 0.5733 acres of land
(b) HPCL Petrol bunk, ITI Colony having area of 0.2222 acres of land
(c) EPFO, F-28 Bldg, having area of 0.6069 acres of land
(d) Thumby Aviation [Halipad - EC Plant] having area of 0.9182 acres of land
(e) Embassy Services Pvt. Ltd. having area of Land and Building 0.776 acres and 6300 Sq.meters respectively.
3. Investment property Land area of 31.3 acres was reclassed PPE amounting to Rs. 11,941 Lakhs (Bengaluru Plant) during the year.
4. The Company is in the process of engaging the registered valuer for obtaining the fair values of various investment properties and hence the disclosure of this information could not be given.
5. Bruhat Benguluru Mahanagara Palike (BBMP) constructed road in ITI land in Krishnarajapuram without permission of ITI which is used by general public despite the stay order from High court of Karnataka.
6. Karnataka Power Transmission Corporation Limited is using 5 Acres of Land and no lease agreement has been entered for the same.
7. Land proposed to be leased to Bengaluru Metropolitan Transport Corporation, BMTC, measuring 12.15 acres is in possession of the BMTC. Pending Government of India approval for the lease, lease
terms and agreement yet to be finalised. Lease rental will be recognised on finalisation of the terms. An amount of Rs.285 lakhs received earlier from the BMTC under an agreement to sell is held
under deposits.
8. Lease agreement with ESIC has expired in the month of July 2016 and renewal lease agreement has not been entered, as the revised lease rent is not settled with ESIC. Further, the Company is in the process of identifying, reviewing and renewing all the lease agreements expired, where the Company is a lessor.
9. Southern Railways were paying rent for 1.83 acres of land used as access road to their facilities, without any written lease agreement till June 1990. However, since the approach road was being used by the public and the residents of the locality, Southern Railways stopped paying rent. Presently, the land is used by the public as right of way.
The Company has signed a contract dated October 01,2020 with the Ministry of Defence for the execution of Army Static Switched Communication Network (ASCON) Phase IV project worth Rs. 8,280.36 Crore. It includes installation, commissioning, and maintenance of telecom equipment, NMS, mobile nodes, and civil works for providing the complete infrastructure at various sites and roll-out of the optical fiber network. The implementation of the project is to be completed in three years and thereafter it must be maintained for ten years including a two-year warranty. For Proof of Concept [PoC] activities, test bed has been setup for at Army Headquarter 5 signal premises of Indian Army. ITI and OEM teams are assisting Army team in PoC process. The PoC is in process and mainly delayed because of the Country-of-Origin Issue which has been resolved now and Poc test trial has been successfully shown to Army Board & Integrated POC is under process currently. The project timeline has been revised upto December 2026.
The Company has entered into an agreement with Bharat Sanchar Nigam Limited (BSNL) vide Purchase Order Ref: BSNLCO/MMP/13(14)/3/2022-MWP dated June 8, 2023, for the rollout of the 4G network in the West Zone. Accordingly, ITI Limited issued a back-to-back Purchase Order (Ref: ITI/NSU/MM-4G/2023/1801 dated June 14, 2023) to Tata Consultancy Services (TCS) for the execution of work across 23,633 sites, covering Planning, Engineering, Supply, Installation, Testing, and Commissioning in the states of Chhattisgarh, Gujarat, Madhya Pradesh, Maharashtra, Mumbai, and Goa, after deducting ITI’s margin. During the year, the Company has recognised revenue of Rs. 2,04,417.36 lakhs (Previous Year Rs. 16,340.79 lakhs), including unbilled revenue of Rs. 13,849.78 lakhs, based on materials dispatched and installation services rendered.
1 Corporate information:
ITI Limited is a public limited company incorporated under the provisions of the Companies Act, 1956. The Company is primarily engaged in the business of Manufacture, sale & servicing of Telecommunication equipments and building communication network infrastructures using Internet Protocol (IP) / Multi Protocol Label Switching (MPLS) Technology, Optical Fibre Cable (OFC), Microwave Radio and Satellite communication channels. Further, Company is engaged in turnkey contracts/solutions and provides customized support. The company operates 16 Marketing, Services & Projects (MSP) centers across India, with their accounts maintained under eight Regional Offices (ROs) located in Bengaluru, Chennai, Hyderabad, Mumbai, Kolkata, Delhi, Lucknow, and Bhubaneswar.
2 An amount of Rs. 16,500 Lakhs has been received from Department of Telecommunications (‘DoT’) - Government of India, towards payment of wage revision arrears during 2014-2015. An amount of Rs. 15,493.72 lakhs has been paid towards payment of wage revision arrears and remaining amount of Rs. 1,006.06 lakhs is outstanding in Other Current Liabilities.
3 Balances in the accounts of creditors, advances from customers, debtors, claims recoverable, loans & advances, materials with fabricators, subcontractors/others, material in transit, deposits, loans, and other payables/receivables such as Sales Tax, VAT, Excise Duty, Cenvat, Service Tax, GST, TDS etc., are under confirmation/reconciliation with the returns filled by the Company for all statutory remittences along with books of accounts. Adjustments, if any will be made on completion of such review / reconciliation / receipt of confirmations. However, in the opinion of the management, the trade receivables, current assets and loans and advances are realisable in the ordinary course of the business.
4 The management is of the opinion that going concern basis of accounting is appropriate in view of the high value of existing order book of Rs.14,82,709 lakhs under execution with adequate margin, expected conversion of unbilled revenue of Rs. 1,79,338 lakhs into billed revenue / realization by completing the contract milestones within next 12 months, step-up the recovery processes to collect the billed dues, adequate sanction of working capital borrowing from consortium banks along with continued support of the Government of India.
5 The Company is primarily engaged in business of manufacturing, trading and servicing of telecommunication equipments and rendering other associated / ancillary services and there are no other reportable segments. The Company is primarily operating in India, which is considered as a single geographical segment. The Company is also engaged in Defence projects. The board of directors is collectively the Company’s ‘Chief Operating Decision Maker’ or ‘CODM’ within the meaning of Indian Accounting Standard (‘IndAS’) 108. The Company has determined that there are no reportable operating segments within the meaning of IndAS 108 as the revenue recognition is through contracts similar in nature. Further, the MCA vide its notification dated February 23, 2018, has exempted companies engaged in the defence production from the requirement of segment reporting. The Company is of the view that such exemption is applicable due to execution of certain defence projects and accordingly no information is furnished as required under the applicable accounting standard.
A reporting entity is exempt from the disclosure requirements of paragraph 18 in relation to related party transactions and outstanding balances, including commitments, with:
a) A government that has control, joint control or significant influence over the reporting entity; and
b) Another entity that is a related party because the same government has control, joint control or significant influence over both the reporting
entity and the other entity.
Accordingly, all transactions with Government or its departments or other Government companies are not reported in terms of Paragraph 25 of the said standard
i) Claims against the Company not acknowledged as debt includes ' 17,075.79 Lakhs claimed by M/s Alphion Corporation, Company has to recover the same amount from BSNL on a back to back basis contract related to GPON. The matter is still pending for disposal before the Hon’ble High Court of Karnataka & after February, 2023, it is not yet listed for further hearing by the court.
(ii) The Company has received notices levying penalties amounting to Rs. 73.25 lakhs from BSE/ NSE for not having sufficient number of independent directors/ women directors. However, on a request to BSE/ NSE stating the reason for non-compliance being a public sector undertaking, the penalties have been waived till the second quarter of FY 2022-23. The Company is confident that the subsequent levies would also be waived. Hence, no provision has been made for these penalties.
(iii) The claims amount includes claim by HFCL of Rs.1,193.88 lakhs towards liquidated damages and confirmed by the Arbitrator.Other non current assets includes Rs. 1049.41 lakhs due from HFCL on account of liquidated damages. However, the Company has filed an appeal against the said claim in the High Court of Delhi.(Refer Note -5)
(iv) The claims against the Company includes claim of balance amount by RECAP Ventures Pvt Ltd of Rs. 615.13 lakhs from the due date till the filing of petition for providing CCMS boxes under EESL tender.
v.) The Company has disclosed a contingent liability of Rs. 6080.81 lakhs towards additional central sales tax liability for non-collection/submission of C/D forms for the past years on the estimated basis. The actual liability may vary based on the collection and submission of the statutory forms and adopting the applicable tax rate at the time of tax assessments.
vi) Rs. 1,312.00 lakhs (Previous Year Rs. 1,809.28 Lakhs) represents details such as “Nil rate of duty availed on software disputed by central excise dept, demand notice received on R&D prototype modules for field trail & CENVAT credit wrongly availed by the Company. The appeal of these 3 cases are currently pending before the CESTAT.
vii) During FY 2023-24, the Company has received a demand for property tax from BBMP for the years from 2008-09 to 2023-24 for Rs. 7,938.21 lakhs as one time settlment to be deposited. However, the Company has appealed BBMP to revise the demand amount on the ground that Company is a sick industry under a revival plan by the BIFR and are eligible for such exemption. During the FY 2024-25, Company paid Rs. 2,647.21 lakhs towards property tax related to the period 2008-09 to 2023-24 as a one time relief the same as disclosed as exceptional item vide note 31(53) below
viii.) Due to the financial crunch, there have been delayed remittance of some of the statutory dues including contribution to the provident fund. The Company has provided interest for the delay on an estimated basis as the actual amount of interest/penalty payable is unascertainable.
(ix) Interest and penalties on arrears of all overdue statutory liabilities (including undisputed) could arise as and when assessed and determined by the respective authorities.
(x) The Sales Tax case of Rs. 504.13 Lakhs, related to FY 2003-04, remains pending with the KVAT Tribunal. No communication has been received in the past four to five years.
(xi) The Company had entered into a Memorandum of Understanding (‘MOU’) with the Minister of State, Department of Minority Affairs and Madrasah Education (MA&ME), Govt of West Bengal dated February 25, 2021 for execution of Infrastructure and IT Development Project wherein it was to host, operate, administer and execute the said project for a consultancy charge of 5% of the total vetted estimated cost of Detailed Project Reports (DPR) without GST. Pursuant to this MOU, the Company reportedly issued Work Orders (WOs) to several vendors before obtaining approvals from the corporate office. The work order issued by MA&ME was reportedly cancelled by the Minister of Minority Affairs, Government of India on March 2, 2022, and Company in turn reportedly cancelled the WOs issued on various vendors on September 2, 2023. There were reportedly irregularities observed in the receipt of the said MOU and as well as in the WOs issued and cancelled by the Company on certain vendors in terms of an inter-office memo from the Chief Vigilance Officer (CVO) to Chairman and Managing Director (CMD) dated July 25, 2023. These irregularities are in the nature of negligence and confirm that there is no fraud committed in this respect. Certain vendors to whom contracts had been awarded have reportedly filed writs in the High Court of Kolkata regarding non-payment of dues by the Company for work completed by them to an extent of Rs. 292 lakhs (to the extent identified). The said claims will not devolve on the Company and hence no adjustment s are required in the books of account, we also confirm that there are no further claims from any other vendors as on the date of the financials statements
(xii) The case of Service Tax Rs.,6456.79 Lakhs is pertainig to FY 2010-11 to FY 2015-16 is pending in High Court, Allahabad and no further commu
nication has been received
(xiii) GST demand including interest and penalty pertaining to GST order 09/2024-25-GST for FY 2019-2020 amounting to Rs. 1,855.77 lakhs
(xiv) The Company has filed an appeal before the Commissioner (Appeals), Cochin, against the order issued pursuant to a GST departmental audit for the Financial Years 2017-18 and 2018-19, wherein the department has alleged ineligible input tax credit claims amounting to Rs. 7054.14 lakhs. The matter is pending, and no further communication has been received from the Appellate Authority as of the reporting date.
(xv) The Company is contesting a GST demand of '928.37 lakhs (including interest and penalty), arising from the department’s allegation of ineligible Input Tax Credit (ITC) claimed in the TRAN-1 filing. The Company has submitted that the alleged ineligible ITC had already been reversed through the GSTR-3B return for August 2018. However, the department issued a demand order without considering this reversal. Aggrieved by the adjudicating authority’s order, the Company has filed an appeal before the Commissioner (Appeals), Cochin.
(xvi) The case relates to FY 2017-18, where the GST Department issued an order against Company without considering its response or allowing a
personal hearing. The Company challenged before the Hon’ble Lucknow High Court. The Court acknowledged the lapse under Section 75(4) of the U.P GST Act, 2017, and set aside the assessment order, allowing fresh proceedings in accordance with law. The total exposure of excess ITC claimed is Rs. 1859.49 lakhs.
(xvii) In respect of Rae Bareli unit, certain electricity dues are outstanding to be resolved and payment to be made after such resolution amounting to Rs. 326.26 lakhs to Uttar Pradesh Power Corporation Limited (UPPCL).
(xviii) Certain disputes with respect to Sales Tax amounting to Rs. 295.09 lakhs, pertaining to Rae Bareli unit are pending resolution.
(xix) Certain tax recovery cases of Rs. 733.36 lakhs are pending resolution relating to the period from 1990 to 2002-03, before the J&K Sales Tax Tribunal. (Srinagar Unit)
(xx) Certain dues of Rs.141.26 lakhs pertaining to RO Bengaluru with respect to Turnover Suppression are pending resolution.
(xxi) Non-payment of Service Tax on royalty income received during earlier periods amounting to Rs. 44.78 lakhs.
(xxii) Certain disputed sales tax of Rs.226.04 lakhs pertaining to RO Bhubaneshwar are pending resolution.
(b) Other litigations
(i) Bruhat Benguluru Mahanagara Palike (BBMP) constructed road in ITI land in Krishnarajapuram without permission of ITI which is used by general public despite the stay order from High court of Karnataka.
(ii) The Company filed a complaint in the Magistrate Civil Court dated 18.05.2022 in furtherance of acting against M/s Mind array Systeme Private Limited. The case is under city commercial court Bengaluru.
(iii) The Company supplied LED Street Light to Infos park , the realization for the same is pending. The Company has filed a case against M/s Infos Park for the cheque which was dishourned by the bank.
(iv) Karnataka Power Transmission Corporation Limited is using 5 Acres of Land and no lease agreement has been entered for the same.
(v) An execution petition was filed by Ram Saran Singh following the order dated 03.10.1993 passed in Civil Suit No. 164/1993 by the Additional District Judge, Raebareli, pertaining to compensation for trees, a well, nursery, and related assets for Rs. 10.00 lakhs.
14 The Company is a Sick Company as per provisions of the Sick Industrial Companies Act (SICA), 1985 and is currently under a revival plan after it was referred to the Board for Industrial and Financial Reconstruction (BIFR). The Cabinet Committee on Economic Affairs (CCEA) approved financial assistance of Rs.4,15,679 lakhs in February 2014 for the revival of the Company under the Rehabilitation Scheme.
15 As a part of the approved financial assistance, an amount of Rs.1,13,256 lakhs have been received towards Capital Grant and Rs.1,89,279 lakhs towards revenue grant till FY 2022-23. Shares have been allotted to the President of India towards the Capital Grant received, on various dates in accordance with the BIFR order dated 08.01.2013 at prevailing market price or average share price for three months prior to the date of allotment, whichever is lower. There were no revenue grants received under BIFR revival plan during FY 2023-24 & FY 2024-25.
16 During FY 2024-25, As per DoT, Order No.20-86/2014-Fac.II (part), letter dated January 21,2025, the Company has received an amount of Rs. 5,900 lakhs towards CAPEX implementation of projects as part of capital grant received under revival package for which the Company has allotted 22,72,202 Equity shares at Rs. 259.66 per share (Each Rs 10 face value fully paid up at a premium of Rs 249.66 per share) to the President of India during the Board Meeting held on 27.05.2025.
17 Land proposed to be leased to Bengaluru Metropolitan Transport Corporation, BMTC, measuring 12.15 acres is in possession of the BMTC. Pending Government of India approval for the lease, lease terms and agreement yet to be finalised. Lease rental will be recognised on finalisation of the terms. An amount of Rs.285 lakhs received earlier from the BMTC under an agreement to sell is held under deposits.
18 Lease agreement with ESIC has expired in the month of July 2016 and renewal lease agreement has not been entered, as the revised lease rent is not settled with ESIC. Further, the Company is in the process of identifying, reviewing and renewing all the lease agreements expired, where the Company is a lessor.
20 Southern Railways were paying rent for 1.83 acres of land used as access road to their facilities, without any written lease agreement till June 1990. However, since the approach road was being used by the public and the residents of the locality, Southern Railways stopped paying rent. Presently, the land is used by the public as right of way.
The title deeds of all the immovable properties , as disclosed in Note 1 and Note 3 to the financial statements are held in the name of the Company except those mentioned below:
(i) Land measuring 77 Acres at Palakkad valuing Rs. 6,090.31 Lakhs (Carrying Value) have been resumed by the Government of Kerala and under adjudication of the Apex Court. The value of Land as shown in the Balance Sheet includes the value of Land resumed by the Govt of Kerala pending decision by the Apex Court.
(ii) ITI Complex land 174.69 acres valuing Rs.9282 lakhs (Carrying Value) was handed over to Naini Unit by District Industrial Officer in 1969 which is not in the name of the Company.
(iii) Transfer of title of 196.37 acres of land (factory area) valuing Rs.11620 Lakhs (Appx) acquired against Gazette No 10574(1). SHA.U/18.II.666/ Bha-72 dted 09.01.1973 pertaining to Villages Ballapur, Chhajlapur & Malikmau Aima, Raebareli transfereed by Industries Department, Raebareli dated 12.11.1973 is pending due to non submission of proof of compensation paid by ITI Limited to the land owners at the time of land acquirement.
21 An amount of Rs.2,144 lakhs is receivable from M/s.Karvy Data Management Services Limited and M/s.Telva Systems, which is overdue. The Company has not made any provision for bad debts in this case as the corresponding liability of similar amount to vendors (back-end partners) is payable only upon recovery of this amount. Provision is made for Rs.242 lakhs being the difference between the amount receivable and payable.
22 No loans or advances in the nature of loans are granted to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013), either severally or jointly with any other person that are (a) repayable on demand or (b) without specifying any terms or period of repayment.
23 No proceedings has been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act 19488 (45 of 1988) and the rules made thereunder.
24 The Company has borrowings from Banks on the basis of security of current assets. The stock and debtors statement filed by the Company with banks are in agreement with the books of accounts
25 The Company has not been declared as a Wilful Defaulter by any banks or other Financial Institutions or other lenders
26 As per the information available with the management, the Company does not have any transactions with companies stuck off under Section 248 of the
Companies Act 2013 or Section 560 of the Companies Act 1956, in respect of investments in securities, receivables, payables, shares held by stuck off company and other outstanding balances.
27 The Company does not have any charges or satisfaction of charges which is yet to be registered with ROC beyond the statutory period.
28 The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
29 The Company does not have any transactions not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
30 The Company has not traded or invested in Crypto or Virtual Currency during the Current or Previous year.
31 The Company has received a mobilization advance of 10,945.23 Lakhs being 10% of the CAPEX value, in respect of the BharatNet Phase-III project awarded by BSNL in Himachal Pradesh. The project is being executed under the Design, Build, Operate and Maintain (DBOM) model.
32 The borrowings obtained by the Company from banks and financial institutions have been applied for the purpose for which such loans are taken.
35 The Company, being a public sector undertaking, the directors on the board of the Company are appointed by the order of Government of India. The composition of board of directors is not as per provisions of SEBI Listing Regulations due to insufficient number of Independent Directors including Women Independent Director. However, the proposal for the appointment of requisite number of Independent Directors including Women Independent Director on the Board of the Company is under process with the Administrative Ministry.
36 Lease agreement with NIFT has expired in the month of November 2018, and renewal lease agreement has not been entered. Due to non realization of rent from NIFT huge burden of GST bear by ITI -ReaBareli Unit on accrual rent. The Company has intimated that the matter has been referred to the administrative mechanism for resolving the same on priority.
37 The material subsequent events for the year ended March 31,2025, have been appropriately disclosed/presented/ recognized in the financial statements. During the year 2025-26, the directors are not aware of any other matter or circumstances since the financial year end and the date of this report, not otherwise dealt with in the financial statements, which significantly affects the financial position of the Company and the results of its operations.
38 Control of the Company lies with the Honorable President, Government of India and other nominees. In light of the same, the Company is a ‘government-related entity’ (with regards to the Government of India) as defined by “Ind AS 24 (Related Party Disclosures)” i.e., an entity that is controlled, jointly controlled or significantly influenced by a government.
39 There are no indicators of impairment identified during the year. Also, carrying amount has been reviewed as at the balance sheet date and there is no impairment of assets for the year. (Previous Year: Nil).
40 a) Confirmation of balances from BSNL & Defence, with whom the Company has significant accounts receivables/payables is in the process during the year and is under negotiation/discussion regarding open items of reconciliations statements drawn up duly signed off. Necessary entries will be incorporated after completion of such discussions/negotiations thereon.
b) Confirmation of balances from all other parties with whom the Company has/had transactions have not been fully obtained. Necessary entries will be incorporated after receiving confirmation of balances and completion of reconciliation thereon.”
41 The preparation of financial statements requires the use of accounting estimates which may significantly vary from the actual results. Management also needs to exercise judgment while applying the Company’s accounting policies. This note provides an overview of the areas that involved a higher degree of judgment or complexity, andofitemswhich are morelikelyto bemateriallyadjustedduetoestimatesand assumptionsturningouttobedifferentthanthoseoriginally assessed.
a) Estimation of defined benefit obligation -
Estimation of defined benefit obligation involves certain significant actuarial assumptions. Estimates and judgments are periodically evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the company and that are believed to be reasonable under the circumstances.
b) Useful life of property, plant and equipment -
The estimated useful life of property, plant and equipment is based on Company’s accounting policy.
c) Provisions and contingencies
The assessments undertaken in recognizing provisions and contingencies have been made in accordance with Ind AS 37 “Provisions, Contingent Liabilities and Contingent Assets”. The evaluation of the likelihood of the contingent events has required best judgment by management regarding the probability of exposure to potential loss. Should circumstances change following unforeseeable developments, this likelihood could alter.”
45 The amortised cost of financial instruments is considered as same as their carrying value in absence of the material impact on financial statements. In case of long term security deposits, discounting is not performed due to no material impact on financial statements.
46 No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
47 No funds have been received by the company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
48 No dividends have been declared or paid during the year by the Company.
49 The Company is in the process of reconciling form 26AS/AIS/TIS with its books of accounts. Upon completion adjustment entries, if any, will be made in the books of accounts.
50 The Company has followed the applicable amendment to schedule III as specified vide notification dated 24.03.2021 Upon completion the required data/ disclosures furnished during Q4 FY 2024-25.
51 The Company’s objective when managing capital are to safeguard its ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders and maintain an appropriate capital structure of debt and equity. The Board of Directors (BOD) has the primary responsibility to maintain strong capital base and reduce the cost of capital through prudent management in deployment of funds and sourcing by leveraging opportunities in financial markets so as to maintain investors, creditors & markets confidence and to sustain future development of the business. The Company’s policy is to maintain a strong capital structure with a focus to mitigate all existing and potential risks to the Company, maintain shareholder, vendor and market confidence and sustain continuous growth and development of the Company. The Company’s focus is on keeping a strong total equity base to ensure independence, security, as well as high financial flexibility without impacting the risk profile of the Company. In order, to maintain or adjust the capital structure, the Company will take appropriate steps as may be necessary. The Company has monitored the long term debt equity ratio which is as follows.
b) Credit Risk
Credit risk refers to the risk of default on its obligation by the counter party resulting in a financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables . Accordingly, credit risk from trade receivables has been separately evaluated from all other financial assets in the following paragraphs.
(i) Credit Risk on trade receivables
Trade receivables are typically unsecured and are derived from revenue earned from customers. Major trade receivables are mainly derived from execution of contracts. These are considered good based on the recovery analysis performed by the company.
Company has customers central/state government utilities with capacity to meet the obligations and therefore the risk of default is negligible. Further, management believes that the unimpaired amounts that are 30 days past due date are still collectable in full, based on the payment security mechanism in place and historical payment behavior. Considering the above factors and the prevalent regulations, the trade receivables continue to have a negligible credit risk on initial recognition and thereafter on each reporting date.
(ii) Credit Risk on other financial assets
The Company considers that all the financial assets that are not impaired and past due for each reporting dates under review are of good credit quality. The Company does not hold any collateral or other enhancements to cover its credit risks associated with its financial assets. Further, cash and cash equivalents are held with public sector banks and do not have any significant credit risk.
c) Liquidity Risk
The Company’s principal sources of liquidity are cash and cash equivalents generated from operations. Company manages our liquidity needs by continuously monitoring cash in flows and by maintaining adequate cash and cash equivalents. Net cash requirements are compared to available cash in order to determine any shortfalls. Short term liquidity requirements consist mainly of trade payable, current maturities of long term borrowings, etc. arising during the normal course of business as at each reporting date. Company maintains a sufficient balance in cash and cash equivalents to meet our short term liquidity requirements. Company assesses long term liquidity requirements on a periodical basis and manages them through internal accruals.
56 Bengaluru Plant has hospital for the welfare of the existing and ex employees health, the management has obtianed service certificate for running the hospital in the premises. The expense related to medical and other are accounted in Bengaluru Plant book of accounts.
57 Ind AS 115 has become effective from 1st April 2018. The core principle of this Standard is that an entity shall recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
Note: The accounting policies & accompanying notes form part of the financial statements
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