Company overview
 
 Hathway Cable and Datacom Limited (the Company) is a Public Company
 domiciled in India and incorporated under the provisions of the
 Companies Act, 1956. The Company is Multi System Operator (MSO) and
 engaged in distribution of television channels through analog and
 digital cable distribution network and internet services through cable.
 Its equity shares are listed on National Stock Exchange of India
 Limited (NSE) & Bombay Stock Exchange Limited (BSE) in India.
 
 1.01 CONTINGENT LIABILITIES
 
 a) The Company has given a counter indemnity favouring the bankers to
 the extent of Rs.48,707,075 (March 31, 2011: Rs.60,988,500) for issue
 of Bank Guarantees in favour of the Company.
 
 b) The Company has given Corporate Guarantees of Rs.634,500,000 (March
 31, 2011: Rs.414,345,000) to Banks & Rs. 328,000,000 (March 31, 2011:
 Rs.328,000,000) to Others towards various credit facilities given by
 the Bank & Others to its subsidiary companies.
 
 d) Pending finalization of negotiations with one of the broadcasters,
 the Company has accounted pay channel cost net of discounts expected
 from such broadcaster. The Company as well as few broadcasters have
 claims and counter claims against each other, which are yet to be
 finalized and settled. The contingent liability in respect of such
 claims wherever ascertained, have been considered under Claims against
 the Company not acknowledged as debts.
 
 e) The relevant Authority under the Karnataka Sales Tax / VAT had
 initiated proceeding to reassess the Company''s liability for the
 financial years 2001-02 to 2008-09 on the argument that light energy
 created while using OFC network for the purposes of transmission is
 goods and hence liable to tax under relevant state legislation.
 
 On writ petition, the Karnataka High Court has held against the
 Company. On further appeal, the Honourable Supreme Court remanded the
 matter to the Tribunal. However, Sales Tax Tribunal did not entertain
 the appeal of the Company as no assessment was made.
 
 The Assessing Officer, acting on Nil returns fled by the Company, has
 proposed to complete best judgment re-assessment to tax light energy as
 goods. This may result in approximate demand of Rs. 54,406,240 (March
 31, 2011: Rs. 54,406,240). The Company has fled a detailed reply to the
 show cause notice issued by the assessing officer and the matter is
 pending.
 
 f) Pursuant to various amendments under Karnataka Entertainment Tax
 Act, 1958 to levy entertainment tax on LCO''s and MSO''s, the Government
 of Karnataka has issued various notices for re-assessment for various
 periods. The Company has challenged the notices and validity of
 amendments with the Hon''ble High Court of Karnataka. The Hon''ble High
 Court of Karnataka has issued stay order against such notices on
 payment of Rs. 6,431,950 being 50% of the Basic Entertainment Tax
 liability.
 
 The Company has filed a petition before the Honourable Court of Andhra
 Pradesh challenging the vires of the amendment to the Andhra Pradesh
 Entertainment Tax Act, 1939 which has resulted in the levying of the
 Entertainment Tax on MSOs. The petition has been admitted and the levy
 and the action pursuant thereto have been ordered to be stayed.
 
 g) The Collector of Aurangabad had initiated proceeding for recovery of
 an amount of Rs.79,192,049 towards non payment of Entertainment Tax up
 to the period September 30, 2011. The Company has preferred an appeal
 before the Divisional Commissioner who has by his order dated January
 16, 2012 partly allowed the appeal by setting aside the order of the
 Additional Collector. The matter has been remanded to the Additional
 Collector for a de novo enquiry.
 
 The matters stated against (g) above, are pending and based on the
 outcome of the respective petitions, liability may extend to period
 beyond notice period. The contingent liability in respect of claims is
 considered as part of Claims against Company not acknowledged as debts.
 
 1.02 CAPITAL AND OTHER COMMITMENTS:
 
 Estimated amount of contracts (including acquisition of intangible
 assets net of advances) remaining to be executed on capital account and
 not provided for aggregate to Rs.1,858,829,743 (March 31, 2011:
 Rs.698,716,613).
 
 The Company in its ordinary course of business has promoted / acquired
 interest in various entities. Considering the long-term involvement of
 the Company in these entities and strategic impact it has on the
 business of the Company, the Company has committed to provide operating
 and financial support to these entities.
 
 1.03 MATTERS RELATING TO SUBSIDIARIES:
 
 a) Two wholly owned subsidiaries of the Company viz. Binary
 Technologies Transfers Pvt. Ltd. or Hathway Internet Satellite Pvt.
 Ltd.  are majority partners in a partnership firm namely M/s. Hathway
 Space Vision (the frm). The aforesaid majority partners of the frm had
 initiated legal action against the minority partners viz. Space Vision
 Cabletel Pvt. Ltd. with reference to some management and operational
 issues. The minority partners had also fled certain claims against the
 Company and majority partners. After a long drawn legal battle, the firm
 stands dissolved under the directions of the Bombay High Court. The
 Court Receiver, High Court of Bombay has been appointed as the Receiver
 of the assets and business of the firm and the Company has been
 appointed as the Agent of the court receiver. The issues concerning
 accounts and dissolution including adjudicating upon the original
 claims and counter claims made before the earlier Arbitrator are
 referred to Arbitration by Justice Srikrishna. The court receiver has
 taken formal possession of the movable assets of the firm and has
 appointed a valuer, the report thereof is pending.
 
 The Company, based on legal advice has not made any provision towards
 claims raised by the minority partner of the firm and such claims are
 frivolous in nature and are considered as claims against the Company
 not acknowledged as debt and included in Note No.4.01 (c).
 
 b) The Company has fled petition to wind up Hathway Jai Mata Di
 Sherawali Cable & Datacom Private Limited (HJMD), a subsidiary company,
 on just and equitable ground. The Company has investment of
 Rs.8,000,000 and receivable of Rs. 7,450,717 from HJMD and the same
 have been fully provided for. In view of the Management disputes with
 the Other Shareholders, the Company has decided to take such an action.
 The Delhi High Court by its order dated May 5, 2010 directed that it is
 just and equitable that HJMD be wound up. The Official Liquidator, as
 appointed and directed by the Delhi High Court, has taken charge of
 HJMD and the process of liquidation is under progress.
 
 1.04 The Trade Receivables includes amount due from disconnected /
 inactive customers and outstanding in excess of one year. The Company
 is taking adequate steps for recovery of overdue debts and advances and
 wherever necessary, adequate provisions have been made. In the opinion
 of the Board, long-term Loans & Advances, Trade Receivables and Current
 Assets have a realizable value in the ordinary course of business not
 less than the amount at which they are stated in the Balance Sheet.
 
 1.05 EXCEPTIONAL ITEMS
 
 a) The Company in its ordinary course of business has promoted /
 acquired interest in various entities. The Company''s exposure to these
 entities on account of Investments in equity shares and preference
 shares, on account of amounts advanced as Loans & Advances and Trade
 Receivables is Rs. 2,820,432,866 (March 31, 2011: Rs. 2,686,763,281),
 Rs. 954,182,741 (March 31, 2011: Rs. 1,020,556,884) and Rs. 455,415,525
 (March 31, 2011: Rs. 490,526,323) respectively. Most of the entities
 have accumulated losses and negative net worth. The Company''s exposure
 to such loss making entities on account of investments in equity shares
 and preference shares, on account of amounts advances as Loans &
 Advances and Trade Receivables is Rs.898,878,542 (March 31, 2011: Rs.
 475,529,504), Rs. 707,281,325 (March 31, 2011: Rs. 726,181,972) and Rs.
 283,971,361 (March 31, 2011: Rs. 258,683,331). The Company has made
 provision on overall basis of Rs. 44,912,654 (March 31, 2011: Rs.
 107,631,965), Rs.  631,000,421 (March 31, 2011: Rs. 619,727,136) and
 Rs.59,039,346 (March 31, 2011: Rs. 62,865,799) against such
 Investments, Loans and Advances and Trade Receivables respectively.
 
 Considering the long-term involvement of the Company in these entities
 and strategic impact it has on the business of the Company, the Company
 has committed to provide financial support to these entities. The
 provisions made during the year include the amounts advanced during the
 year.
 
 b) During the previous year the Company had, in respect of a joint
 venture viz. Hathway Channel 5 Cable & Datacom Private Limited, fled a
 complaint against the joint venture partner for committing various
 criminal offences such as misappropriation of funds, falsification of
 accounts, fraudulent destruction of security etc. and had made claim of
 Rs.74,321,905. The matter has since been settled out of court and both
 the parties have withdrawn their respective cases. The exposure of the
 Company is Rs. 99,779,696 (March 31, 2011: Rs.104,934,075) against
 which a provision of Rs. Nil (March 31, 2011: Rs.62,819,311) has been
 made. On settlement of disputes, the provision made during the previous
 year has been reversed.
 
 c) During the year 2009-10, due to certain business exigencies in the
 state of Tamilnadu, local cable operators and subscribers had migrated
 to competing Multi System Operator (MSO) and other service providers.
 As a consequence, the Company relocated part of its assets to other
 States so as to maximize the economic returns to the Company and is in
 the process of recovering balance access devices and other assets.
 However, as a matter of abundant caution, additional provision has been
 made as an Exceptional Item for Rs. 104,333,070 (March 31, 2011:
 Rs.56,593,892). The balance WDV of the Distribution Equipments, Access
 Devices and Other Assets located in the State of Tamil Nadu as on 31st
 March 2012 is Rs.Nil (March 31, 2011: Rs.6,552,000), Rs. Nil (March 31,
 2011: Rs. 112,653,753) and Rs, Nil (March 31, 2011: Rs.1,086,104)
 respectively.
 
 Also In addition to the above Rs.10,444,370 (March 31, 2011: Rs.Nil)
 has been written back after netting of expense for loans and advances,
 deposits and other current assets against current liabilities and
 deposit received outstanding in the books in the state of Tamilnadu.
 
 d) Pursuant to the proposed implementation of Digital Addressable
 System (DAS), the Company has incurred expenditure amounting to
 Rs.4,040,839 (March 31, 2011: Rs.Nil) towards promotional campaign
 relating to awareness of DAS for 100% digitalization for all the four
 metros from November 01, 2012.
 
 1.06 OUTSTANDING LETTER OF CREDIT :
 
 Outstanding Letters of Credit Rs.459,212,667 (March 31, 2011:
 Rs.203,898,846) secured against assets acquired under LC facility,
 hypothecation of present and future current assets of the Company and
 extension of pari passu hypothecation of present and future movable
 fixed assets of the Company.
 
 1.07 EMPLOYEE STOCK OPTION PLAN
 
 The shareholders of the Company have approved Employee Stock Option
 Plan i.e. HATHWAY ESOP 2007 (The Plan). The Plan provides for issue
 of options (underlying equity share of Rs.10 each) to the persons
 specified in the scheme at the price determined by the remuneration
 committee appointed by the Board of Directors. Price determined by the
 remuneration committee is in the range of Rs.110.20 to Rs.157.30.
 
 The Options granted under the Plan shall vest within not less than one
 year and not more than five years from the date of grant of options.
 Under the terms of the Plan, 20% of the options will vest to the
 employees every year. Once the options vest as per the Plan, they would
 be exercisable by the Option Grantee at any time within a period of
 three years from the date of vesting and the shares received on
 exercise of such options shall not be subject to any lock-in period.
 
 The value of the options granted is determined by the management based
 on the rates at which shares were allotted to the investors during the
 relevant year and the same has been considered as fair value of option.
 
 1.08 EMPLOYEE BENEFITS
 
 a) Defined Benefit Plans:
 
 The present value of the Defined benefit obligations and the related
 current service cost were measured using the Projected Unit Credit
 Method, with actuarial valuations being carried out at each balance
 sheet date.
 
 b) Defined Contribution Plans:
 
 Contribution to provident and other funds is recognized as an expense
 in Schedule L of the Statement of Profit and Loss
 
 1.09 SEGMENTAL REPORTING
 
 The Company is a Multi System Operator providing Cable Television
 Network Services, Internet Services and allied services which is
 considered as the only reportable segment. The Company''s operations are
 based in India.
 
 1.10 RELATED PARTY DISCLOSURES Particulars of Related Parties
 
 Names of related parties and related party relationship where control
 exist A.  Under Control of the Company
 
 1 Wholly Owned Subsidiaries:
 
 Bee Network & Communication Pvt. Ltd.
 
 Binary Technology Transfers Pvt. Ltd.
 
 Hathway C-Net Pvt. Ltd.
 
 Hathway Enjoy Cable Network Pvt. Ltd.
 
 Hathway Gwalior Cable & Datacom Pvt. Ltd.
 
 Hathway Internet Satellite Pvt. Ltd.
 
 Hathway JMD Farukhabad Cable Network Pvt Ltd.
 
 Hathway Media Vision Pvt. Ltd.
 
 Hathway Space Vision Cabletel Pvt. Ltd.
 
 Hathway United Cables Pvt. Ltd.
 
 Hathway Universal Cabletel & Datacom Pvt Ltd.
 
 Ideal Cables Pvt. Ltd.
 
 ITV Interactive Media Pvt. Ltd.
 
 Liberty Media Vision Pvt. Ltd.
 
 Vision India Networks Pvt. Ltd.
 
 Win Cable and Datacom Pvt. Ltd.
 
 2 Other – Subsidiaries
 
 Chennai Cable Vision Network Pvt. Ltd.
 
 Channels India Network Pvt. Ltd
 
 Elite Cable Network Pvt. Ltd.
 
 Hathway Digital Saharanpur Cable & Datacom Pvt. Ltd.
 
 Hathway ICE Television Pvt. Ltd.
 
 Hathway Sonali Om Crystal Cable Pvt. Ltd.
 
 Hathway MCN Pvt. Ltd.
 
 Hathway Nashik Cable Network Pvt. Ltd.
 
 Hathway Krishna Cables Pvt. Ltd.
 
 Hathway Rajesh Multi channel Pvt. Ltd.
 
 Hathway Software Developers Pvt. Ltd
 
 UTN Cable Communications Pvt. Ltd.
 
 Gujarat Telelink Pvt. Ltd.
 
 Hathway Bhaskar Multinet Pvt. Ltd.
 
 Hathway Latur MCN Cable & Datacom Pvt. Ltd.
 
 Hathway Channel 5 Cable & Datacom Pvt. Ltd.
 
 Hathway Mysore Cable Network Pvt. Ltd.
 
 Hathway Prime Cable & Datacom Pvt Ltd
 
 Hathway Mantra Cable & Datacom Pvt. Ltd.
 
 Hathway Jai Mata Di Sherawali Cable & Datacom Pvt Ltd.
 
 Hathway Sai Star Cable & Datacom Pvt. Ltd.
 
 Hathway New Concept Cable & Datacom Pvt. Ltd.
 
 Hathway Palampur Cable Network Pvt. Ltd.
 
 Hathway Cable MCN Nanded Pvt. Ltd.
 
 Net 9 Online Hathway Pvt. Ltd.
 
 Hathway Bhawani Cabletel and Datacom Ltd.* Hathway Dattatray Cable
 Network Pvt. Ltd.  Hathway Bhaskar CCN Multinet Pvt. Ltd CCN
 Entertainment India Pvt. Ltd.  Chhattisgarh Broadband Network Pvt Ltd.
 Hathway Kokan Crystal Cable Network Pvt. Ltd.
 
 B.  Related party with whom transaction has taken place :
 
 1 Joint Ventures Hathway Sukhamrit Cable & Datacom Pvt. Ltd.
 
 2 Associate Company Pan Cable Services Pvt. Ltd.
 
 Hathway VCN Cabletel Pvt. Ltd.
 
 3 Others Hathway Space Vision
 
 Hathway Cable Entertainment Pvt. Ltd.
 
 Hathway Jhansi JMDSR Cable & Datacom Pvt. Ltd.
 
 4 Key Managerial Personnel K Jayaraman-Managing Director (Refer Note
 No: 4.20)
 
 The transactions with related parties and the closing balances due
 to/from parties are as follows. The previous year figures are mentioned
 in brackets:
 
 In Addition to aforementioned transactions, the Company has given
 Corporate Guarantees of Rs.853,000,000 (March 31, 2011: Rs.719,250,000)
 on behalf of Gujarat Telelink Private Limited, Rs.100,000,000 (March
 31, 2011: Rs.Nil) on behalf of Hathway Bhaskar Multinet Pvt. Ltd., Rs.
 9,500,000 (March 31, 2011: Rs.22,895,000) on behalf of Hathway MCN
 Private Limited and given counter indemnity favouring the Bankers
 towards Bank Guarantees issued on behalf of Hathway MCN Private Limited
 and Hathway Media Vision Private Limited of Rs. Nil (March 31, 2011:
 Rs. 2,500,000) and Rs.Nil (March 31, 2011: Rs. 200,000) respectively
 included in. Also for Letter of Credit facility availed by Gujarat
 Telelink Private Limited.
 
 Details of debits / credits which are purely in the nature of
 reimbursements are not included in above.
 
 1.11 JOINT VENTURES
 
 The Company has the following Joint Venture arrangements in the
 capacity of a Venturer in the following as on 31 March 2012 :
 
 a.  Hathway Sukhamrit Cable and Datacom Private Limited*
 
 b.  Hathway Jai Mata Di Balaji Cable Network
 
 c.  Mantra Enterprises
 
 d.  Mona Cable
 
 1.12 DEFERRAL/CAPITALIZATION OF EXCHANGE DIFFERENCES
 
 The Ministry of Corporate Affairs (MCA) has issued the amendment dated
 December 29, 2011 to AS 11 The Effects of Changes in Foreign Exchange
 Rates, to allow companies deferral/capitalization of exchange
 differences arising on long-term foreign currency monetary items.
 
 In accordance with the amendment/earlier amendment to AS 11, the
 company has capitalized exchange loss, arising on long-term foreign
 currency loan, amounting to Rs.48,930,843 (March 31, 2011: Rs.886,565)
 to the cost of plant and equipment''s. The company has also capitalized
 exchange gain, arising on long-term foreign forward contract,
 undertaken to partially hedge the foreign current loan, amounting to
 Rs.4,618,573 rupees (March 31, 2011: Rs.176,958 rupees) to the cost of
 plant and equipments. The company does not have any other long-term
 foreign currency monetary item. Hence, the amount of exchange loss
 deferred in the Foreign Currency Monetary Item Translation Difference
 Account is Rs.NIL (March 31, 2011: Rs.NIL).
 
 1.13 MANAGERIAL REMUNERATION
 
 The Company had made an application to the Central Government for
 approval for payment of remuneration to the Managing Director & CEO
 from August 7, 2010 for a period of three years in excess of limits
 prescribed under section 198 and 309 read with Schedule XIII to the
 Companies Act, 1956. In response to the application, the Central
 Government has called for certain additional information and the same
 are being furnished.
 
 However, while responding to the above application, the Central
 Government has directed the Company to either recover or apply for
 waiver of the remuneration paid in excess of remuneration prescribed
 under the said schedule during the period August 26, 2009 (the date on
 which the status of the Company change to public limited company) to
 August 7, 2010. Since the remuneration paid during the period February
 7, 2010 to August 7, 2010 was at minimum scale prescribed under
 Schedule XIII to the Act, there is no question of having paid excess
 remuneration. The remuneration for the period prior to that was
 finalized when the Company was a private company and accordingly, as
 legally advised; the Company was not required to apply the Government
 for the approval. However, as required by the Central Government, the
 Company is in the process of applying for the waiver of remuneration
 and sitting fees for the period August 26, 2009 to February 7, 2010.
 
 1.14 During the year under review, the Company has not capitalized any
 borrowing cost in the absence of any qualifying assets.
 
 1.15 The Initial Public Offer (IPO) proceeds have been utilized as per
 objects as stated in the prospectus dated February 17, 2010 and as
 subsequently modified and approved by the Shareholders by an Ordinary
 Resolution through Postal ballot as per the provision of Section 192A
 of the Companies Act, 1956
 
 1.16 Till the year ended March 31, 2011, pre-revised Schedule VI to the
 Companies Act 1956 was being used for preparation and presentation of
 financial statements. During the year ended March 31, 2012, the revised
 Schedule VI notified under the Companies Act 1956, has become applicable
 to the company. Accordingly, the company has reclassified previous year
 figures to confirm to this year''s classification. On adoption of the
 revised Schedule VI, there has been no significant impact on recognition
 and measurement principles followed for preparation of financial
 statements.