Dear Members, 
  
 We, the Board of Directors of your Company, have pleasure in presenting
 the 8th Annual Report of the Company together with the Audited
 Financial Accounts for the Financial Year ended 31st March, 2004.
  
 Financial Results : 
  
                                                2003-04     2002-03
 
 Particulars                                     Rs. in      Rs. in 
                                                  Lakhs       Lakhs 
  
 Operating Profit                                184.99      262.70
 
 Less: Depreciation                              188.71      256.18
 
 Less: Misc. Expenditure written off                  -      149.03
 
 Profit/Loss before Tax                         (-)3.72        6.52
 
 Less: Provision for Taxation                         -           -
 
 Less: Book-profit Tax                             0.02        0.27
 
 Less: Deferred Tax Liability                         -       53.86
 
 Add: Deferred Tax Asset                           9.88           -
 
 Add: Prior period adjustment                      4.38        2.58
 
 Profit after Tax                                 10.52    (-)47.61
 
 Surplus brought forward from Previous Year     1206.44     1254.05
 
 Balance available for Appropriations           1216.95     1206.44
 
 Share Warrants advance                               -       45.84
 
 Forfeiture A/C                                   45.84           -
 
 Balance carried forward to Balance Sheet       1171.14     1206.44 
  
 Performance Review: 
 
 The Company has continued its efforts though the general trend of
 Software Industry is not encouraging and has earned total revenue of
 Rs. 358.01 lakhs and a net profit of Rs. 10.52 lakhs, due to the
 addition of deferred tax asset of Rs. 9.88 lakhs.
  
 Product Development: Your Company has continued to make efforts to
 bridge the awareness about its flagship product BATHINA VOICEAUTO,
 has increased from major organizations related to different sectors
 like Banks, Financial Institutions, R & D Divisions of Multi National
 Companies, Pharma and Biotechnology Sectors etc. Various Educational
 Institutions and Universities. On the Government front, various
 Departments of Many State Governments as well as the Central Government
 including Revenue, Judiciary, Police and Irrigation Departments etc.,
 have keenly expressed their desire in using your product for the
 purpose of Office Automation. This magnitude requires fresh inflow of
 capital.
  
 The product, Bathing Voice Auto, Version 2.0 is ready for release and
 in the final stage of incorporating the features required by the users
 of different sectors pertaining to their usage. By incorporating these
 features, your product would become not only versatile bulk also
 unique.
  
 The product has been rated one among the top products on par with the
 international standards expected for the products of this nature,
 incorporating features like multiple vocabularies, subject vise
 vocabularies, Desktop Navigation etc has evolved your product. A new
 approach has also been adopted in the technology thereby the technology
 works efficiently in order to provide improved accuracy and robustness
 to the product. In addition, unlike previous version of the product,
 which is compatible with MS Office: Suite, Version 2.0 can adopt to
 various office automation tools and different operating systems.
  
 R&D Policy and Expansion/Diversification: 
 
 The Company focuses to be in the development of Technologies and
 related Platforms, Products, Applications, and Technology-Services.
 Your Company is planning to continue in the base Voice Automation
 Technology, Products, and Solutions and is also planning to expand
 Research and Development in the areas of integrated solutions as
 explained above.
  
 Exports: 
 
 The Company has not exported any software or services during the
 financial year 2003-04. As explained in the earlier reports, your
 Company is doing Research and Development on Voice Automation, being
 the first of its kind anywhere in the world, the certification process
 by the end users is getting delayed. All the resources of the Company
 are deployed in the product leaving little room for undertaking any
 other work.
  
 Dividend: 
 
 Since the Company is struggling with cash problem as explained above;
 the Directors do not recommend any dividend.
  
 Corporate Governance: 
 
 The Corporate Governance Regulations under the listing Agreement; have
 been implemented from the Financial Year 2002-03. The report on
 Corporate Governance as required is attached herein and forms part of
 this report.
  
 Directors: 
 
 Shri V. Rao Bathing, Chairman & Managing Director is not liable to
 retire by rotation. Sort. B. Sasi Bimba and Shri N. Srinivasa Rao
 retire by rotation and being eligible offer themselves for
 reappointment.
  
 Audit Committee: 
 
 The Audit Committee has been restructured consisting of the following
 Directors with effect from 31.07.2004:
  
 1. Shri N. Srinivasa Rao, Committee Chairman 
 2. Smt. B. Sasi Bimba, Member of the Committee 
 3. Smi. R. Laxmi Kantham, Member of the Committee 
  
 Investors' Grievances Committee: 
 
 The Investors' Grievances Committee has been restructured consisting of
 the following Directors with effect from 31.07.2004 :
  
 1. Shri N. Srinivasa Rao, Committee Chairman 
 2. Smt. B. Sasi Bimba, Member of the Committee 
 3. Smt. R. Laxmi Kantham, Member of the Committee 
  
 Auditors: 
 
 M/s JBRK & Co., Chartered Accountants. Auditors of the Company retire
 at the conclusion of the ensuing Annual General Meeting. They have
 signified their willingness to accept re-appointment and have also
 confirmed their eligibility under Section 224(1B) of the Companies
 Act, 1956.
  
 Directors' Responsibility Statement as required under Section 217(2AA)
 of the Companies Act, 1956, In pursuance et the provisions of Section
 217(2AA) of the Companies Act, 1956, it is hereby confirmed
  
 (i) That in preparing the Annual Accounts, all applicable Accounting
 Standards have been followed ;
  
 (ii) That the Accounting Policies adopted are consistently followed and
 the judgments and estimates made are reasonable and prudent so as to
 give a true and fair view of the state of affairs of the Company at the
 end of the financial year and the Profit & Loss Account of the Company
 for the financial year under review;
  
 (iii) That the Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 1956 for safeguarding the assets of
 the Company and for preventing/detecting fraud and other irregularities
 and
  
 (iv) That the Annual accounts have been prepared on a `going concern'
 basis.
  
 Future Outlook: 
 
 The Company confidently expects good revenues from product sales as
 well as services in the coming years. Your Company has been able to
 penetrate into difficult market of the Voice Automation and made a mark
 for itself as a Number One Company in the World for providing Voice
 Automation Solutions. The Govt. of Andhra Pradesh has initiated a pilot
 project for testing the product in one of its Department and trials
 have proved successful after certain customization. The Company expects
 good orders from the Government of AP and other State Governments also.
  
 The Company has been focusing on the product that has left it cash
 starved. In view of the same, it has become increasingly difficult to
 sustain the operations. However, with the promised Government support,
 the Company could come out with quantum leap in sales and profits.
  
 In addition to the Information Technology, Mr. Bathina has taken-up on
 his own, research in Biotechnology area in a very small scale. The
 part-time work on this research for the past one and a half-years' work
 has shown some positive results. Mr. Bathina has been talking to some
 top-ranking bio-technology scientists and organizations abroad to
 mutually share technologies and make it commercial. So far, a very good
 positive responses from these international organizations is quite were
 couraging. If this biotech research give some commercial success, Mr.
 Bathina wishes to ad Biotechnology to your company's present
 Information Technology line of business.
  
 Bio-Informatics, an area that is a combination of Information
 Technology and Biotechnology is also very promising.
  
 Both contract works and Independent research are possible in the
 Biotechnology and Bio-Informatics areas.
  
 Employees' Relations: 
 
 The Directors place on record, their appreciation of the contributions
 made be the employees at all levels for their dedication, support and
 hard work. The Employer-Employee relations an strained to some extent
 as the company was not in position to pay their salaries on regular
 basis.
  
 Fixed Deposits: 
 
 The Company did not accept an deposits pursuant to Section 58A of the
 Company Act, 1956.
  
 Particulars of Employees: 
 
 There are no employee covered under Section 217(2A) of the Companies
 Act, 1956 read with the Companies (Particulars of Employees) Rules,
 1975 and forming part of the Directors' Report for the financial year
 ended 31st March 2003.
  
 Conservation of Energy, Research and Development, Technology Absorption
 & Foreign Exchange Earnings and Outgo: 
 
 The particulars as prescribe under Section 217(1)(e) of the Companies
 Act, 1956, read with the Companies (Disclosure of Particulars the
 Report of Board of Directors) Rules, 1988 are set out in the annexure
 included in this Report.
  
 Observations by the Auditors: 
 
 All the qualification remarks made by the auditors have been addresse
 in Schedule 9-Notes forming part of accounts, attached to the
 balance sheet
  
 Acknowledgements: 
 
 The Directors place on record their appreciation of the continued
 assistance and co operation extended to the Company by the Bankers
 Government & Semi-Government Departments, an Shareholders.
  
                       for and on behalf of the Board of Directors 
  
                                     V. RAO BATHINA 
                             Chairman and Managing Director 
 Place : Hyderabad 
 Date : 4 August 2004 
  
 ANNEXURE TO THE DIRECTORS' REPORT 
  
 ANNEXURE - A 
  
 Particulars pursuant to the Companies (Disclosure of Particulars in the
 Report of Board of Directors) Rules, 1988:
  
 (A) Details of Conservation of Energy: 
 
 Even though energy conservation is not applicable to our business, as a
 national concern, your Company kept energy conservation as an
 objective. Your Company's operations require electricity for
 conditioned environment, for running the computers and for lighting
 purpose and none of these are energy intensive. The consumption has
 been low due to the reason, majority of the development work has been
 completed and the manpower requirement has come dome down
 substantially.
  
 (B) Technology Absorption : 
  
 (a) Research and Development (R & D) : 
  
 1. Specific areas in which R&D work has been done by the Company and
 the benefits derived from R&D: Your Company being a technology focusing
 Company, in its continued endeavor has focused on natural man-machine
 interaction and continued its Research and development in the area of
 Natural Interface. Speech being the most natural interlace, your
 Company focused on and pioneered Voice Automation Technology, which is
 a combination of Speech Recognition and Natural Language Understanding.
  
 2. Future Plan of Action: 
 
 As explained earlier, your Company proposes to continue to research on
 knowledge based Voice Automation Technology and Integrated Solutions
 for Both Domestic and International Markets.
  
 3. Expenditure on R&D: During the year 
  
 Capital NIL
 Recurring 15885734
 
 Total R&D expenditure asa percentage of total revenue 44.37% 
  
 (b) Technology absorption, adaptation and innovation: 
 
 The Company has brought out excellent innovations in Voice Automation,
 Technologies and recognized as Number One Voice Automation Solutions
 Provider. It is your Company's endeavor to continue research to bring
 out solutions that are very useful for various professionals and
 non-professionals in both Domestic and International Markets.
  
 (c) Foreign Exchange Earnings and Outgo : 
  
 1. Initiatives taken to increase exports, development of new export
 markets for products and services and export plans: Your Company has
 been exporting its products and planning on continuing with the product
 exports. We are emphasizing on setting up international marketing
 network to improve the exports.
  
 2. Foreign Exchange Earned: NIL 
  
 3. Foreign Exchange Outgo: NIL