1.  SHARE CAPITAL
 
 Equity Share Capital
 
 The Rated Redeemable Unsecured Rupee Non-Convertible Dentures (NCDs) of
 Rs. 140,000 Lacs are redeemable over the period of 3 to 5 years and in
 respect of the same, equivalent amount of Debenture Redemption Reserve
 is required to be created over the tenor of the Debentures on pro-rata
 basis. During the period, Debenture Redemption Reserve of Rs. 140,000
 Lacs is created to the extent of available of profit for the period
 ended June 30,2011.
 
 2.  OTHER SECURITIES CREATED
 
 The Company avails fund-based facilities like sale bill discounting and
 non-fund based facilities like Letters of Credit, Bank Guarantees and
 Dealer Finance in the course of its operations. The aggregate of such
 sanctioned facilities as on June 30, 2011 is Rs. 4, 11,500.00 Lacs (Rs.
 225,400.00 Lacs). Out of these facilities, Rs. 2, 45,000.00 Lacs (Rs.
 45,500.00 Lacs) are unsecured facilities and Rs. 166,500.00 Lacs (Rs.
 179,900.00 Lacs) are secured facilities. The details of secured
 facilities are as under:
 
 i) Facilities of Rs. 22,200.00 Lacs (Rs. 22,200.00 Lacs) are secured on a
 pari passu basis against the movable and immovable fixed assets &
 hypothecation of goods specifically procured.
 
 ii) Facilities ofRs. 122, 500.00 Lacs (Rs. 129,500.00 Lacs) are secured on
 hypothecation of goods specifically procured under the non- fund based
 facilities
 
 iii) Facilities of Rs. 7500 Lacs (NIL) are secured on hypothecation on
 receivables arising out of Distribution ship Franchisee of MSEDCL
 
 iv) Facilities of Rs. 14,300.00 Lacs (Rs. 28,200.00 Lacs) are partly
 secured by Cash Margin in the form of pledge of Term deposits.
 
 Bank Deposits are pledged towards margin money for Letter of Credit
 Facilities Rs. 7,324.33 lacs (Rs. 7,140 lacs), Bank Guarantees Rs. 2,659.33
 lac (Rs. 2,650.84 lac) & Trade Finance of Rs. 41,713.94 lac (Rs. 46,407.40),
 aggregating to Rs. 51,697.60 Lacs (Rs. 56,198.57 Lacs). Subsequent to the
 balance sheet date the banks have invoked the peldge in respect of
 fixed deposits of Rs. 32,419.00 Lacs offered as security for trade
 finance facility.
 
 3. a) GTL Infrastructure Ltd (GIL) is an associate of the Company. The
 Company''s holding in GIL, as at Balance Sheet date is 36.22%.
 (Previous year 31.30%) As a promoter of GIL, the Company has furnished
 following undertakings in respect of credit facilities of Rs. 352,900
 Lacs sanctioned by various lending institutions for GIL''s second phase
 project of setting up telecom sites.
 
 i. The Company along with Global Holding Corporation Private Limited
 (GHC) an associate shall not reduce the shareholding in GIL below 26%
 (Previous year 26%). The Company shall retain the management control of
 GIL.
 
 ii. The Company shall bring or arrange Equity/ Preference Capital as
 envisaged by Phase II lenders.
 
 iii. In case of cost overrun or shortfall, the Company shall bring and/
 or arrange additional capital within a period of 90 days from written
 demand by Creditor''s Agent either in form of Equity or preference or
 subordinated loans.
 
 iv. The Company shall ensure that GIL will not abandon the Project
 during the currency of Phase-II loans.
 
 v. The Company shall ensure that GIL is provided with requisite
 technical, financial and managerial expertise to perform/discharge its
 obligation under the project.
 
 b.  The Company''s holding in European Projects & Aviation Private
 Limited (EPAL) (Formerly known as Global Projects & Aviation Private
 Limited (GPAL).) as at Balance Sheet date is 19% (Previous year
 19%).EPAL has been sanctioned Working capital line of credit of Rs.
 50,000 Lacs. .  The Company has furnished various undertakings for the
 above referred line of credit which interalia provide as under :
 
 i. The Company along with its associate Global Holding Corporation
 Private Limited (GHC) shall not reduce the shareholding in EPAL below
 51 % (fifty one percent). The Company shall retain the management
 control of EPAL during the tenor of credit facilities.
 
 ii. The Company along with its associate GHC shall ensure conversion of
 Redeemable Preference Shares issued by EPAL in to Equity Shares or
 compulsorily convertible instrument or shall ensure that the same shall
 be redeemed out of infusion of fresh equity or compulsorily convertible
 instrument by the promoters of EPAL.
 
 iii. The Company shall Contribute towards the shortfall in the funds
 required by EPAL to complete the projects as defined in terms and
 conditions of credit facilities.
 
 c.  Global Rural Netco Limited (GRNL) is an associate of the Company &
 holds 42.86% (Previous year 42.86%) Equity Capital of GRNL as at
 Balance Sheet date. GRNL has issued fully Convertible Debentures of
 
 Rs. 25, 000 Lacs. The Company has furnished following undertaking for the
 above referred issue of fully Convertible Debenture.
 
 i. The Company along with its associate Global Holding Corporation
 Private Limited (GHC) shall not reduce its shareholding in the total
 paid up equity capital of GRNL below 26% (twenty six percent) and
 retain the management control of GRNL till the sale of the FCDs and/or
 the conversion of FCDs by the Investor, whichever is later; and
 
 ii. The Company along with GHC shall purchase FCDs on Put option if
 exercised by the Investor as per the terms detailed in the letter of
 Intent.
 
 d.  Chennai Network Infrastructure Limited (CNIL) is an associate of
 the Company. The Company holds 30.00% (Previous year 33.60%) Equity
 Capital of CNIL as at Balance Sheet date. As sponsors to CNIL, the
 Company along with its associates Global Holding Corporation Private
 Limited and GTL Infrastructure Limited have agreed to hold and maintain
 at least 26% (Twenty Six percent ) of the total paid-up Equity Share
 Capital of CNIL and to further contribute in the form of equity in
 future, if required to meet needs of CNIL and to replenish Debt Service
 Account Letter of Credit ( DSRA LC ), in the event DSRA LC is invoked
 by the lenders
 
 e.  The Company has investment of US $ 5,000 in Alfa Impex Telecom
 Limited (AITL). In respect the borrowing by AITL, The Company has
 agreed for Put Option of US $ 35 mn (equivalent to Rs. 15,697.50 lacs) in
 the event of default by AITL.
 
 4.  As on April 01, 2010 Promoter and Promoter Group were holding
 48.02% of the equity share capital of the Company. Between April 2010
 and June 2010, by way of creeping acquisitions in the open market,
 Promoter and Promoter groups'' holding increased to 52.83% of the equity
 share capital of the Company. On account of further issue of shares
 pursuant to ESOP conversions, the Promoter and Promoter group
 shareholding was diluted to 52.72% as on January 14, 2011. On further
 acquisitions during June 2011, the promoter and promoter group
 shareholding increased to 52.77%.
 
 On January 28, 2011, the Promoter and Promoter group pledged 12.85%
 comprising 12,500,000 equity shares of the Company.  On June 23, 2011,
 the Promoter and Promoter Group pledged additional 9.77% comprising
 9,500,000 equity shares, thereby taking the pledged quantity to a total
 of 22,000,000 equity shares being 22.62% of the equity share capital of
 the Company.
 
 On December 22, 2010, the Company was sanctioned a long term loan of Rs.
 500 Crore by ICICI Bank Limited (ICICI). For securing the said loan,
 the Promoter and Promoter Group had furnished Non Disposal Undertaking
 (with POA) to ICICI on December 24, 2010 for 28,500,000 equity shares
 of the Company and on July 4, 2011 ICICI created pledge on the said
 shares, thus taking the aggregate of pledged shares to 50,500,000
 representing 51.92% of the total outstanding equity capital of the
 Company.
 
 On July 26, 2011, ICICI invoked the pledge on 28,500,000 equity shares
 by transferring it to their account resulting into a reduction of
 Promoter and Promoter Group holdings to 23.47% from 52.77%.
 
 5.  The Company''s shareholding in GTL Infrastructure Ltd. (GIL), an
 associate of the Company as at April 1, 2010, was 31.30% of the Equity
 share capital of GIL. Between April 2010 and June 2010, by way of
 creeping acquisitions in the open market, the Company''s shareholding in
 GIL increased to 36.22% of the equity share capital of GIL.
 
 Chennai Network Infrastructure Limited (CNIL), a Special Purpose
 Vehicle set-up by GIL for acquiring 17,500 telecom towers of Aircel and
 its subsidiaries, availed a Term Loan of Rs. 250 Cr. from IFCI Limited
 (IFCI). For securing the said loan, the Company had entered into a Non
 Disposal and Escrow Agreement (NDU) on July 9, 2010 with IFCI for
 273,729,000 equity shares held by the Company in GIL. On July 13, 2011,
 IFCI by invoking security, created a pledge on the shares kept in
 escrow account.
 
 On July 18, 2011 and July 19, 2011, IFCI sold 100,000 shares each,
 thereby appropriating about Rs. 30 Lac. On July 20, 2011 IFCI advised the
 Company about invocation of pledge on 176,368,219 equity shares of GIL
 at the closing price of Rs. 14.25 per share on NSE, thereby appropriating
 the proceeds amounting to about Rs. 251 Cr and has issued a No Dues
 Certificate to CNIL on July 22,2011. As a result of the above
 invocation/sale of shares by IFCI, the Company''s holding in GIL stands
 reduced to 17.78% from 36.22%.
 
 The Company (pledgor) has contested this appropriation and accordingly
 beneficial ownership of IFCI is under dispute and in view thereof the
 Company continues to account its investment in GIL.
 
 6.  EMPLOYEE STOCK OPTIONS
 
 a.  ESOP 2001
 
 The Company obtained approval of the shareholders at the 13th AGM held
 on July 30, 2001, for allocation of 1,500,000 warrants convertible into
 equal number of equity shares to employees of the Company and 1,000,000
 warrants convertible into equal number of equity shares to employees of
 its subsidiaries (in the form of warrants under ESOP-2001) at an
 exercise price, at a discount upto 25% of the closing market price of
 the Company''s shares on the National Stock Exchange of India Ltd.
 (NSE) on the previous trading day of the date of allotment of warrants.
 The vesting schedule from the date of allotment under this grant is as
 under:
 
 15% after 12 months 
 
 15% after 18 months 
 
 15% after 24 months 
 
 15% after 30 months 
 
 15% after 36 months 
 
 15% after 42 months 
 
 10% after 48 months
 
 In this ESOP 2001 Scheme, the Company had granted 2,159,800 warrants to
 its Employees and 72,550 warrants to employees of its subsidiaries.
 This includes 793,611 and 44,950 warrants respectively lapsed/cancelled
 till date due to resignation. The lapsed/cancelled warrants were added
 back to the kitty for reissuance to the eligible employees from time to
 time.
 
 b.  ESOP 2002
 
 The Company obtained further approval of the shareholders at the 14th
 AGM held on July 25, 2002, for allocation of 3,000,000 warrants
 convertible into equal number of equity shares to employees of the
 Company and similarly 1,000,000 equity shares to employees of its
 subsidiaries (in the form of warrants under ESOP 2002) at an exercise
 price, at a discount up to 25% of the Average Price of the weekly high
 and low of the closing prices of the Company''s shares on the NSE, for
 the preceding six months of the month in which the Warrants are
 allotted.
 
 In this ESOP 2002 Scheme, the Company had granted 4,189,130 warrants to
 its Employees and 1,219,850 warrants to employees of its subsidiaries.
 This includes 1,222,476 and 344,980 warrants respectively
 lapsed/cancelled till date due to resignation. The lapsed/ cancelled
 warrants were added back to the kitty for reissuance to the eligible
 employees from time to time.
 
 c.  ESOP 2004
 
 The Company obtained further approval of the shareholders at the 16th
 AGM held on September 16, 2004, for allocation of 3,000,000 warrants
 convertible into equal number of equity shares to employees of the
 Company and similarly 500,000 warrants convertible into equal number of
 equity shares to employees of its subsidiaries (in the form of warrants
 under ESOP 2004) at an exercise price, at a discount up to 25% of the
 Average Price of the weekly high and low of the closing prices of the
 Company''s shares on the NSE, for the preceding six months of the month
 in which the Warrants are allotted.
 
 In this ESOP 2004 Scheme, the Company had granted 3,191,000 warrants to
 its Employees and 223,900 warrants to employees of its subsidiaries.
 This includes 508,270 and 30,750 warrants respectively lapsed/cancelled
 till date due to resignation. The lapsed/cancelled warrants were added
 back to the kitty for reissuance to the eligible employees from time to
 time.
 
 d.  ESOP 2005
 
 The Company obtained further approval of the shareholders at the 17th
 AGM held on September 27, 2005, for allocation of 3,500,000 warrants
 convertible into equal number of equity shares to employees of the
 Company and similarly 300,000 warrants convertible into equal number of
 equity shares to employees of its subsidiaries (in the form of warrants
 under ESOP 2005) at an exercise price, at a discount up to 25% of the
 Average Price of the weekly high and low of the closing prices of the
 Company''s shares on the NSE or BSE, as the case may be where the volume
 of shares traded is more, in the preceding six months of the month in
 which the Warrants are allotted.
 
 In this ESOP 2005 Scheme, the Company had granted 316,500 warrants to
 its Employees This includes 5,500 warrants lapsed/ cancelled till date
 due to resignation. The lapsed/cancelled warrants were added back to
 the kitty for reissuance to the eligible employees from time to time.
 
 e.  ESOP 2008
 
 The Company obtained further approval of the shareholders at the 20th
 AGM held on June 13, 2008, for allocation of 1,500,000 warrants
 convertible into equal number of equity shares to employees of the
 Company under this scheme(in the form of warrants under ESOP 2008) at
 an exercise price at a discount up to 25% of the Average Price of the
 weekly high and low of the closing prices for the preceding six months
 of the month in which the warrants are allotted or the closing market
 price on the previous trading day on which the warrants are allotted,
 whichever is lower, on the National Stock Exchange of India Limited or
 Bombay Stock Exchange Limited as the case may be where the volume of
 shares traded is more. In this ESOP 2008 Scheme, No grants have been
 issued to the Employees till date.
 
 7.  Additional information pursuant to the provisions of paragraph 3
 (ii) (d) of Part II of the Schedule VI to the Companies Act, 1956: -
 
 The Company is in the business of providing Network Services involving
 Network Planning & Designing, Network Deployment, Operation and
 Maintenance, Professional Services and Energy Management. In view of
 the composite nature of business activities, the company has not
 furnished the quantitative information as required under paragraph 3
 (ii) (d) of Part II of Schedule VI.
 
 Name of the key managerial personnel
 
 a Mr. Manoj Tirodkar, Chairman (Mr. Manoj Tirodkar is re-designated as
 a Non-Executive Chairman with effect from 01st April 2011)
 
 b Mr. Charudatta Naik, Whole-time Director
 
 c Mr. Sukanta Kumar Roy , Whole-time Director and COO with effect from
 27th July 2010
 
 8.  FINANCIAL AND OTHER DERIVATIVE INSTRUMENTS:
 
 b) All Derivatives and Financial instruments are for hedging purpose
 only.
 
 9.  OPERATING LEASES
 
 The Company''s lease agreements are in respect of operating lease for
 office premises, guesthouse, warehouses and vehicles. These lease
 arrangements are cancellable by either parties there to as per the
 terms and condition of the agreements. The lease rental recognized to
 the profit & loss account during the period ended are Rs. 1,565.28 lacs
 (Rs. 1,134.98 lacs). The lease obligations due within five-years are 
 Rs.2,326.69 lacs (Rs.1,814.41 lacs).
 
 10.  On 28th September, 2010, the Income Tax authorities carried out
 search and seizure operations at the Company premises. The Company has
 provided necessary information required by the authorities.  The
 Company believes that there will be no material tax liability. The
 amount of tax liability, if any, shall be determined upon completion of
 the proceedings by the Authorities.
 
 11.  The Balances of Sundry Debtors and Sundry Creditors are subject to
 reconciliation and confirmation. Appropriate adjustment if necessary
 will be considered in the year of reconciliation.
 
 12.  In respect of Goods procured and supplied under agency
 arrangements, commission of Rs. 2,134.62 Lacs (Previous Year Rs. 2,598.38
 lacs) is recognized as Income. During the period, as per the
 contractually agreed terms under these arrangements, the company has
 discharged its liability of principal for the goods procured through
 supplier''s bill facility. The receivables from the principal for the
 same as at the period- end are Rs. 44,754.82 lacs (Rs. 40,149.45 lacs).
 These receivables and the liability for acceptances referred above are
 presented net in the Financial Statements.
 
 13.  The Company has entered into Agreement for Assignment of
 Receivable” with GTL Infrastructure Limited (GIL). In terms of the said
 agreement, GIL has assigned receivables from its customer with regards
 to Energy Management to the Company. Out of the assigned Receivable
 during the period of Rs. 20,057.81 lacs (Rs. 10,579.14), outstanding amount
 of Rs. 4,247.95 lacs (Rs. 4,312.01 lacs) as at June 30, 2011 is shown under
 ‘Other Current Assets”.
 
 14.  SEGMENT REPORTING
 
 Reporting as per Accounting Standard 17 based on consolidated Financial
 Statements is forming part Consolidated Financial Statement.
 
 15.  IMPAIRMENT OF ASSETS
 
 In Accordance with the Accounting Standard (AS-28) on Impairment of
 Assets” the management during the year carried out an exercise of
 identifying the assets that may have been impaired in respect of each
 cash-generating unit. On the basis of this review carried out by the
 management, there was no impairment loss on fixed assets during the
 period ended June 30, 2011.
 
 16.  CONSOLIDATED FINANCIAL STATEMENTS
 
 Consolidated financials statements forming part of the accounts with
 the Auditors report thereon are attached herewith.
 
 17.  The Previous year''s figures, wherever necessary, have been
 regrouped/ rearranged/recast to make them comparable with those of the
 current period.
 
 18.  Figures in brackets relate to the previous year unless otherwise
 stated.
 
 19.  The figures for the 15 months period are not comparable to
 previous year, that being of 12 months.