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Download Annual Report PDF Format 2013 | 2011 | 2010
Directors Report Year End : Mar '14    « Mar 13
The Members
 
 ITI Limited
 
 The Directors have pleasure in presenting the 64th Annual Report of
 the Company together with Audited Accounts and Auditors'' Report thereon
 for the year ended 31st March 2014.
 
 1.  PERFORMANCE:
 
 The Company has achieved Sales and Production of Rs. 769.90 Crore and Rs.
 767.91 Crore respectively during the year 2013-14 against Rs. 921.04
 Crore and Rs. 910.16 Crore respectively during the previous year 2012-13.
 The Company could achieve this turnover in spite of the fact that our
 major customers BSNL and MTNL have not placed orders like earlier
 years.  The net loss of the Company for the year 2013-14 is Rs. 344. 26
 Crore against the figure of Rs. 182.06 Crore for the year 2012-13, which
 however, was after considering a grant of Rs. 177.23 Crore by the
 Government.
 
 The net loss for the year 2013-14 is the lowest ever loss in the last
 twelve financial years (if the financial assistance by way of grant from
 the government is not taken into account).
 
 The contribution (net of material cost) for the year is Rs. 184.99 Crore,
 which is comparable for that of previous year at Rs. 187.27 Crore.
 
 2.  SANCTION OF REVIVAL PROPOSAL :
 
 The Directors are pleased to inform that ITI''s Revival Plan has been
 approved by the Cabinet Committee on Economic Affairs (CCEA) on 12th
 February 2014.  The financial package approved by CCEA includes funding
 support for Rs. 1892.79 Crore as grant-in-aid towards clearing of part of
 its liabilities and Rs. 2264 Crore as equity for upgradation and
 implementation of several projects as part of revival plan. The
 Government has already approved release of Rs. 460 Crore as frst stage
 disbursement to the Company towards capital expenditure in the recent
 budget for the year 2014-15.
 
 In the Revival plan, around 18 projects have been identified for
 implementation. This includes expansion of capacities for manufacturing
 of existing telecom products like Encryptors for Defence sector, G-PON,
 DWDM, MLLN, Ethernet, Broadband equipments, SMART cards etc. and also
 diversified products like Solar, LED lightings, Data center and Defence projects.
 
 These projects are allocated to all the six units of ITI for their
 revival. The project implementation will be done in three phases. For
 the implementation of projects in the 1st phase an amount of Rs. 460
 crore has already approved by the Government in the recent budget. The
 amount required for the implementation of projects in 2nd and 3rd
 phases is expected to be released subsequently.  For monitoring of the
 implementation of the projects, committees have been formed at unit
 level, corporate level at ITI and at DoT level and also at APEX level.
 
 As part of diversifcation, all the Units have taken various initiatives
 for enhancement of production and sales.
 
 Mankapur Unit developed and entered into production of various LED
 based lighting products. ITI Mankapur executed an order from ONGC under
 their Corporate Social Responsibility (CSR) Swach Roshni Abhiyan
 Project.
 
 Naini Unit established High Wattage Solar Panels manufacturing line of
 280 W SPV panel and tested internally. For commercial orders, IEC
 certification is under process.
 
 Rae Bareli Unit developed ''Total Solution for Lightening & Surge
 Protection Unit (LSPU) and the frst lot of 39 units were supplied to
 Ahmedabad BSNL Gujarat Circle.
 
 Palakkad Unit has established inroads in the Defence manufacturing area
 by supplying to NPOL (National Physical Oceanographic Laboratory), HVF
 (Heavy Vehicle Factory) Avadi, etc. The Plant has opened a separate
 manufacturing area for meeting the requirements of production of Space
 related products and have supplied to VSSC (Vikram Sarabhai Space
 Centre) both bare and assembled PCBs.
 
 3.  HIGHLIGHTS:
 
 - The turnover for the year 2013-14 is mainly constituted from National
 Population Register (NPR), GSM-WZ, GSM-SZ, G-PoN, AMC for OCB & ASCON,
 Defence and IT solutions.
 
 - The Company is executing Turnkey Project of Registrar General of
 India (RGI) for creation of Multi Purpose National Identifcation Card
 under National Population Register (NPR) project for the country.
 
 - Company is executing Restructured Accelerated Power Development
 Reforms Program (RAPDRP) of value Rs. 307 Crore from Tamil Nadu
 Electricity Board (TNEB).
 
 PRODUCTION
 
                                                     (Rs. in Crore)
                                             2013-14         2012-13
                                          (including       (including 
 Sl. Product/Project                          ED &             ED &
 No.                                         Service         Service
                                               Tax)            Tax)
 
 1   C-DOT Products                            0.16            1.61
 
 2   Diversifed                               16.63            9.37 
     Products / Cont. Mfg.
 
 3   Solar Panel                              18.85           22.76
 
 4   PCM MUX                                   1.33            0.52
 
 5   MLLN                                    105.45           11.07
 
 6   GSM – WZ (Incl. BTS,                     84.04           61.62 
     RTT, Shelter & AMC )
 
 7   GSM – MTNL                                   0            1.15
 
 8   GSM – SZ                                  0.96            1.75
 
 9   ADSL – CPE                                   0            2.89
 
 10  Misc. Services                           26.12           24.82
 
 11  Defence / ASCON                          69.02           60.96
 
 12  OCB AMC Business                         37.82           42.05
 
 13  SIM / USIM / SMART                        0.35           26.54 
     Cards
 
 14  NPR/SECC Projects                       234.25          410.14 
     (Data)
 
 15  SMPS                                      1.27            1.65
 
 16  G-PoN                                     8.77           16.29
 
 17  ROs / CCO / IT                          150.27          207.80
 
 18  Data Centre                              14.61           18.05
 
     TOTAL (including ED &                   769.90          921.04
             Service Tax)
 
 
 Projects executed during the year 2013-14:
 
 National Population Registration (NPR) and Socio Economic & Caste
 Census (SECC) projects:
 
 ITI is one among the consortium of three PSUs (other two PSUs being BEL
 & ECIL) for the execution of prestigious National Population Register
 (NPR) Project under Ministry of Home Affairs (MHA). The job involves
 collection of citizen data including biometrics. The above consortium
 is also executing SECC project for the Ministry of Rural Development.
 
 MLLN (Managed Leased Line Networks):
 
 ITI has successfully rolled out countrywide MLLN network for BSNL in
 technical collaboration with a technology partner. ITI had received an
 expansion order from BSNL and the same has been executed during
 2013-14.
 
 GSM:
 
 ITI has implemented GSM Projects in BSNL West Zone and in technology
 alliance with M/s Alcatel- Lucent & in South Zone in technology
 alliance with Huawei. The Annual Maintenance Contract related works
 have been carried out for West zone network.
 
 G-PON (Gigabit Passive Optical Network):
 
 ITI has been a major supplier of this product to BSNL and MTNL using
 the imported technology.  Some G-PON equipments against the earlier
 orders have been supplied during 2013-14. Requirements are anticipated
 for this product in future also for applications like FTTH.
 
 Defence Projects:
 
 ITI is the leader in supplying encryption equipments for the secured
 communication in the Defence networks. ITI has supplied telecom
 equipment like Telephones, Ruggedized Telephone Exchanges, Transmission
 equipments, VSAT etc. to the Defence sector. ITI has also executed
 ASCON project (Phase I, II, & III) successfully.
 
 Solar Project:
 
 Naini Plant of ITI is having requisite expertise and experience for
 implementing Solar solutions. ITI has executed solar projects for BSNL
 as well as UP police. BSNL and other Service Providers are planning to
 upgrade their outdoor GSM Telecom BTS sites with Solar Power especially
 in rural areas where grid power supply position is poor. ITI Naini is
 planning to augment the solar panel manufacturing infrastructure in its
 plant.
 
 Data Center & IT Projects:
 
 ITI has already established Tier 3  state-of-art Data center at
 Bangalore on PPP model. Presently this Data Center is fully booked for
 co-location services.  ITI is also playing a major role in implementing
 IT projects. The State Governments are pursuing E-Governance projects
 for taking the benefit of IT to the Village Panchayats and they have
 made a substantial budget provision for the same. ITI is aggressively
 pursuing this Market segment. ITI is also executing Accelerated Power
 Development and Reform Programme (APDRP) of Tamil Nadu state.
 
 Maintenance Contracts:
 
 ITI had earlier established the ASCON network for Indian Army. ITI was
 also the major supplier of fixed line switches to BSNL and MTNL.
 Currently ITI has been extending maintenance assistance to Indian Army,
 BSNL and MTNL under Annual Maintenance Contracts. (AMC)
 
 4.  FINANCE:
 
 The performance of the Company for the year 2013- 2014 as compared to
 the previous year is as follows:
 
                                                       (Rs.. in Crore)
 
 SI.  Particulars                           2013-2014       2012-2013 
 No.
 
 i.   Sales including                           770            921
      services
 
 ii.  Value of                                  768            910
      Production
 
 iii. Loss before tax                           344            182
 
 iv.  Loss after tax                            344            182
 
 v.   Financing                                 122             85
      Expenses
 
 vi.  Depreciation                               17             18
 
 vii. Capital Employed                          952           1226
      (Net Fixed Assts   Net 
       Current Assets)
 
 viii. R&D Expenditure                           17             18
 
 
 5.  DIVIDEND:
 
 As your Company has incurred a loss, the Directors are not in a
 position to recommend any dividend for the year 2013-2014.
 
 6.  HIGHLIGHTS OF THE PRODUCTION PLANTS AND SERVICE UNITS:
 
 BANGALORE PLANT:
 
 Bangalore Plant achieved a performance of Rs. 51.12 Crore. This
 performance consist of supply of Defence equipment of Rs. 17.11 Crore,
 Data Centre services worth Rs. 14.61 Crore, AMC, repair and Miscellaneous
 products worth Rs. 19.40 Crore.
 
 During the year, the Plant has bagged National Safety Award for the
 Performance Year 2011 – RUNNER for accident free category on September
 18, 2013.
 
 MANKAPUR PLANT:
 
 Mankapur Plant achieved a performance of Rs. 11.27 Crore. The Plant has
 executed 2.157 Million Nos. of Biometric Data entry against NPR-40
 Project worth Rs. 8.29 Crore and Banking/Miscellaneous products worth Rs.
 2.98 Crore.
 
 During the year, the Plant has bagged 2 National Safety Awards –
 Performance Year 2011 – WINNER for ''Lowest Average Accident Frequency
 Rate'' Category and Performance Year 2011 – WINNER for ''Accident Free
 Year'' Category on September 18, 2013.
 
 RAE BARELI PLANT:
 
 Rae Bareli Plant achieved a performance of Rs. 61.52 Crore; Rs. 8.77 Crore
 from dispatch of ONT of GPON equipment, Rs. 1.42 Crore from the supply of
 SMPS & Misc. equipments, Rs. 22.81 Crore worth of GSM Franchisee business
 and 73.25 lacs nos.  of Biometric Entry against NPR-40 project valuing
 Rs. 28.52 Crore.
 
 NAINI PLANT:
 
 Naini Plant achieved a performance of Rs. 20.60 Crore.  The Plant has
 supplied 131 Nos. of Solar Panel equipment worth Rs.18.86 Crore, Misc./
 Contract Manufacturing worth of Rs. 0.06 Crore and 4.37 lacs nos. of
 Biometric Entry against NPR-40 project valuing Rs. 1.68 Crore.
 
 PALAKKAD PLANT:
 
 Palakkad Plant achieved a performance of Rs. 300.60 Crore. The Plant has
 captured Bio-metric data collection/data entry against NPR/SECC
 Projects worth Rs. 193.66 Crore, Supply of MLLN & AMC Project worth Rs.
 105.45 Crore and Miscellaneous/ Contract Manufacturing worth Rs. 1.49
 Crore.
 
 In the Industrial Safety front, consecutively for the second year,
 Plant was runner up for the Outstanding Safety performance in the large
 size Engineering Industries Group from National Safety Council, Kerala
 Chapter and third prize winner from Directorate of Factories, Kerala
 Government for large scale industries.
 
 SRINAGAR PLANT:
 
 Srinagar Plant achieved a performance of Rs. 0.04 Crore against services.
 
 A high level committee visited Srinagar Plant from 15th to 16th
 November 2013 comprising Shri K.L.  Dhingra, CMD; Shri N.K. Joshi, DDG
 (SU) and Shri Shahbaz Ali, DDG (TPF) to review the functioning of
 Srinagar Plant.
 
 The committee in its report recommended short term, mid term and long
 term measures for revival of the Unit.
 
 Government allocation of Rs. 460 Crore for ITI Ltd under the budget for
 year 2014-15 includes a provision for Srinagar Unit. The same will be
 utilised for implementing the recommendations of the Committee.
 
 NETWORK SYSTEMS UNIT:
 
 Network Systems Unit achieved a performance of Rs. 89.73 Crore. The
 performance mainly comprises of Annual Maintenance Contract for fixed
 line OCB exchanges worth Rs. 37.82 Crore for BSNL & MTNL and AMC for
 ASCON worth Rs. 51.91 Crore.
 
 REGIONAL OFFICES
 
 Regional offices and its Customer Care Organization (CCO) achieved a
 performance of Rs. 151.59 Crore.  This performance consists of Rs. 64.54
 Crore supplies of ITI''s manufacturing products and other traded
 products, Rs. 51.17 Crore of Services, Rs. 3.30 Crore by various CCOs and Rs.
 32.58 Crore towards IT Projects.
 
 HIGHLIGHTS OF REGIONAL OFFICES
 
 Performance:
 
 - Performance of ROs for the FY 2013-14 is Rs. 151.59 Crore.
 
 - Order bagged in 2013-14 is Rs. 68.82 Crore.
 
 - Rs. 379.35 Crore orders on hand as on 01.04.2014.
 
 - RO-Mumbai collected C-Form worth Rs. 88.57 Crore for other units.
 
 - RO Mumbai realized payment of Rs. 17.59 Crore for
 
 other units.
 
 New Projects taken up by ROs in 2013-14 :
 
 - Supply and Implementation of College Management Software - RO Delhi
 
 - Establishment of Police Control Room – RO Lucknow
 
 - NPR project taken up for the state of Meghalaya - RO Kolkata
 
 Big orders successfully completed by ROs in 2013-14
 
 - Supply & Installation of Video Conferencing Systems of value Rs. 6.62
 Crore-RO Lucknow
 
 - Supply of Anti Riot Equipments of value Rs. 4.62 Crore to UP Police -
 RO Lucknow
 
 - e Tendering business of value Rs. 35 Crore - RO Delhi
 
 GSM Projects:
 
 The Company carried out AMC services for GSM Network worth Rs. 83.43
 Crore against BSNL orders in West Zone.
 
 7.  RATING IN MEMORANDUM OF UNDERSTANDING
 
 The Company''s rating for the year 2012-13 is GOOD with a Composite
 Score of 2.94.
 
 This Composite Score is BEST during Eleven years, i.e. 2002-03 to
 2012-13.
 
 The Company has signed Memorandum of Understanding with the
 Administrative Ministry for a Sales Turnover of Rs. 1500 Crore for the
 Company for the year 2014-15.
 
 8.  FUTURE OUTLOOK:
 
 Defence projects
 
 ITI is looking at Defence market as a great opportunity for its
 business. With greater thrust towards domestic manufacturing of Defence
 equipments, ITI proposes taking up manufacturing of new products for
 Defence like, Software Defined Radio (SDR), High Frequency Radio
 Handsets, TR modules for RADAR, Electronic Fuzes, equipments for Army
 Wide Area Network (AWAN Phase II) etc.
 
 Other major projects which have been launched by Indian Army are ASCON
 Phase IV and Battlefeld Management System (BMS). Earlier three phases
 of ASCON project have been executed by ITI successfully and ITI is
 hopeful of getting order for ASCON phase IV project also. ITI has also
 responded to the RFI against the BMS project and has presented details
 on BMS solution to the Indian Army.
 
 Solar Project
 
 There has been special emphasis by the Government of India to implement
 the renewable energy sources including solar to overcome the
 environmental hazards and meeting the growing energy needs.  ITI,
 having requisite expertise and experience for implementing solar
 solutions, is planning to augment the solar panel manufacturing
 infrastructure in its Naini plant and is also planning to install one
 more manufacturing facility at its Srinagar plant.
 
 Tablet PC manufacturing
 
 Ministry of Human Resources Development has an ambitious plan of
 distributing Tablet PCs to all students at College level for empowering
 students to access educational data through internet.  Similar
 programmes are being launched by State Governments also. These devices
 are also being used by common man for e-enabled applications similar to
 mobile phones. Since the requirements are huge, ITI is planning to take
 up manufacture of this product at its various units. ITI has already
 been qualified for the low cost tablet PC supplies announced by the
 Ministry of HRD and has been listed by DGS&D.
 
 Core Telecom Products
 
 ITI is pursuing on addressing the core telecom market like GSM, Next
 Generation Networks (NGN), Long Term Evolution (LTE), and Managed
 Leased Line Network (MLLN) etc. The LTE technology is expected to be
 the future technology in mobile communications.  ITI is planning to
 take up manufacturing of these products by entering into collaboration
 agreements with technology providers.
 
 NFS
 
 The Government funded projects like Network for Spectrum (NFS) require
 many types of telecom equipments like DWDM, Carrier Ethernet,
 Microwave, IP-MPLS equipments etc. in huge volumes. ITI is planning to
 take up manufacture of these products with suitable technology
 collaborations. In the tender foated by BSNL for laying optical cables
 under
 
 NFS project, ITI was L1 and has recently received Advance Purchase
 Order (APO) from BSNL worth Rs. 2111 Crore (excluding AMC) for
 establishment of optical fber network in two (out of seven) zones in
 the Country.
 
 LED Lighting
 
 LED lighting is an environmental friendly system due to non-use of
 Mercury. Market potential for this product is very good. ITI is
 planning to address this market. Potential areas of business
 opportunities are expected from National Highway Authority, State
 Governments and Municipal Corporations, CPWDs/ PWDs, Railways, Hotels
 and Hospital Industry.
 
 Data Center
 
 Considering the huge scope existing in the market of Data Center
 particularly in the Government sector, for projects of national
 importance like NPR, UIDAI and other Projects/Schemes envisaged by
 Government agencies & PSUs, ITI is planning to establish its own Data
 Center.
 
 Manufacture of Citizen ID Cards
 
 As an extension of NPR project which is under execution by ITI as a
 consortium partner with BEL and ECIL, ITI is also looking at the huge
 opportunity of manufacturing SMART card based citizen identity cards
 for all the citizens in the Country. ITI is already having SMART card
 manufacturing facility at its Palakkad plant. This will be further
 augmented to take manufacture of citizen ID cards.
 
 Manufacturing of Li-Ion Batteries
 
 High density back up power solutions using Li-Ion technology have been
 proved in the felds of consumer electronics like PCs, Mobile phones,
 Tablet PCs etc.  They are also making inroads into other applications
 like powering GSM towers. ITI is planning to take up manufacturing of
 Li-Ion batteries in one of its plants.
 
 9.  CONTRIBUTION TO EXCHEQUER:
 
 During the year, your Company has contributed Rs. 45.01 Crore to the
 exchequer towards duties and taxes.
 
 10.  PUBLIC DEPOSITS:
 
 Value of deposits held by the Company was NIL.  Deposits aggregating to
 Rs. 0.24 Crore had matured for payment, but were not claimed on due
 dates.
 
 11. REVIEW OF ACCOUNTS BY INDIAN AUDIT AND ACCOUNTS DEPARTMENT:
 
 The comments on the accounts for the year 2013-14 by the Comptroller
 and Auditor General of India is appended.
 
 12.  JOINT VENTURES :
 
 INDIA SATCOM LIMITED
 
 India Satcom Limited (ISL) is a Joint Venture Company incorporated on
 5th October, 1987 by ITI, Unit Trust of India (UTI) and Equatorial
 Pacifc International Company (EPIC). Both EPIC and UTI sold their
 respective stakes in ISL to M/s Chris Tech Systems Pvt. Ltd. (CTSPL)
 and ITI also took steps to sell its entire 49% equity stake in ISL to
 CTSPL. The Government of India, Ministry of Communications & IT vide
 its letter dated 28.01.2011 has not approved the above said sale of 49%
 ITI''s equity stake in ISL to CTSPL, therefore the transfer of ITI
 shares could not be effected. Now, the shareholders in the Joint
 Venture are ITI (49%) and CTSPL (51%).
 
 13.  QUALITY:
 
 Quality policy of ITI is to deliver high quality, secure and reliable
 products, services and solutions. Quality Assurance wings have been
 established in all the manufacturing units of ITI Ltd. The QA wings are
 responsible for Quality of products and services. The Units have been
 well equipped with necessary test facilities and test systems for
 carrying out elaborate tests, conducting reliability evaluations on all
 the products to ensure quality. This is achieved by sound and effective
 Quality Management System.
 
 The five manufacturing plants at Bangalore, Palakkad, Mankapur, Rae
 Bareli and Naini have been accredited with ISO 9001:2008. NSU Bangalore
 is also accredited with ISO 9001-2008. The periodical Surveillance
 Audit & Recertification Audits have been conducted successfully. Keeping
 in tune with the Global concern for Environmental Management, all the
 plants have gone in for ISO 14001:2004 EMS certifications. The guidance
 and support to all the units for training, implementation surveillance
 audits & recertification audits of ISO 9001-2008 and EMS 14001: 2014 are
 provided by Corporate Quality Assurance.
 
 BSNL QA has granted AIS (Approved Inspection Scheme) status for SIM
 Cards. Localization activities continued during the year to procure
 items such as cables, connectors and PCBs for GSM-BTS Project with
 Alcatel Lucent approval and after approval from VDA and VRC. VDC, VRC,
 Components Testing and Reliability Labs provide Qualifcation Approval
 Standardizations of electronic components Vendor Development and Vendor
 Rating after stringent evaluation in Testing in Reliability and
 Environmental laboratory.
 
 14.  MAN POWER:
 
 Employee strength at the end of the year 31st March, 2014 was 7311 out
 of which 623 were female employees.
 
 As on 31st March 2014, there were 1203 employees belonging to Scheduled
 Castes and 67 belonging to Scheduled Tribes.
 
 1 Chief Manager on permanent basis, 51 Contract Engineers & 34 Contract
 Technicians were recruited during the year 2013-2014.
 
 Employees belonging to Physically Challenged Persons numbering 102 and
 Ex-servicemen category numbering 36 were on the rolls of the company as
 at the end of the financial year.
 
 15. HUMAN RESOURCE DEVELOPMENT:
 
 Human Resource Development (HRD), keeping in view the initiatives taken
 for organizational turnaround, diversifcation and the Company''s MOU
 target on HRM – Training for 2013-14, focused on imparting need based
 training for executives and non-executives in the areas of New
 Technology, Information Technology and General Management Development.
 
 To keep pace with the advancements in Telecom & Information Technology,
 training programmes on the topics like GPON, OFC Networks, Mobile
 Communications, Cloud Computing, MLLN, Networking, Cyber Security,
 etc., were organized.  Management Development programmes focused on
 Leadership, Finance, Human Resource, Vigilance, Quality, Personality
 Development, etc., besides organizing a host of awareness programmes.
 
 The MoU HRM Training performance indicators were to train the company
 executives and non-executives and impart Risk Management training for
 senior executives. Following the MoU targets, the company, for
 knowledge / skill up-gradation of it''s manpower working at Corporate
 office, Corporate marketing – including Regional and sub offices,
 Manufacturing plants, Network Systems Unit, located across the country,
 has organized 49 exclusive training programmes covering 1134 executives
 and 27 training programmes covering 711 non-executives achieving
 totally 2868 training mandays. Besides, 45 need based awareness
 training programmes have been organised in the areas of safety, health,
 energy, environment management etc., by Plant HR (ED) Centres. 1184
 personnel have been benefited by these programmes and the company
 records 1369 training mandays on these awareness programmes. An
 in-house Training on ''Risk Management'' was conducted for senior
 executives.  A group of 23 executives, consisting of DGMs and above,
 participated in the training.
 
 During the year, the company has sponsored 11 executives/non-executives
 for external training through renowned organizations / training
 institutions.
 
 In a nutshell the Company trained 2040 executives, 989 non-executives
 achieving 2061 and 1176 training mandays respectively.
 
 16.  INDUSTRIAL RELATIONS:
 
 The Industrial Relations scenario in the Company was cordial during the
 year. Employees'' Union and officers'' Association extended their
 co-operation and support in ensuring smooth work fow and helped to meet
 the Company''s objective.
 
 17.  OFFICIAL LANGUAGE:
 
 All Units/offices have established Check-points in their concerned
 offices to make more efforts for effective Implementation of the Offcial
 Language Policy, monitored by the Offcial Language Implementation
 Committees constituted in every Unit/ office.
 
 The Progress of Implementation of Offcial Language in Corporate office
 as well as in all subordinate Units/ offices is also being periodically
 reviewed by the OLIC Committee of Corporate office.
 
 In order to enhance the working knowledge of Offcial Language amongst
 our employees, offcials have been sent to Training Programme organized
 by the government for imparting training in Hindi, Hindi typing and
 Hindi Stenography as per our requirement.  However, the Offcial
 Language Cell of the different Units/ offices has also conducted
 internal training programmes. Besides, employees were encouraged to
 take part in Hindi Prabodh, Praveen & Pragya examinations and have been
 sanctioned financial incentives.
 
 Since eighty percent (80%) of the staff working in our Units / offices
 like Naini, Rae Bareli, Mankapur, New Delhi, Mumbai, Lucknow &
 Corporate office have acquired a working knowledge of Hindi, such Units
 / offices have been notifed in the Gazette of India as per OL Rules 10
 (2) & (4), 1976.
 
 For Bangalore based Units/offices, a short term workshop for Hindi
 Unicode training programme were organized in the HRD deptt. of
 Corporate office, with the help of Dy. Manager-OL & HR, BHEL, Bangalore.
 More than 30 officers/non-officers participated and they were trained how
 to use the Hindi Unicode Fonts in day-to-day typing work.
 
 After reviewing our quarterly report, an appreciation letter was also
 received from the Deputy Director-OL, Offcial Language Department DoT,
 New Delhi as well as Deputy Director (Implementation), Regional
 Implementation office, Bangalore.
 
 A Joint Hindi Fortnight Programme for Bangalore based PSUs /
 Organisations between 16th September 2013 and 23rd October 2013 was
 organized by TOLIC (Town Offcial Language Implementation Committee),
 Bangalore and various types of competitions were arranged during this
 occasion.
 
 18.  VIGILANCE :
 
 During the year, Vigilance Department functioned effectively and
 efficiently being a part of Corporate Governance Structure. The prime
 focus of the vigilance activities was to reduce the pendency of
 complaints by expediting Investigation. Greater emphasis was laid on
 preventive vigilance. CVC guidelines and Government policies in this
 regard have been followed. To achieve the above objectives, periodical
 inputs were given to the Management regarding review of Administrative
 expenses, implementation of Rotational Transfers of Executives in
 sensitive areas in the company.
 
 To improve the transparency and effciency of the procedures, several
 System Improvement Measures have been suggested to various departments.
 Constant and continuous efforts have been made in this direction as a
 part of Preventive Vigilance.
 
 Logical conclusions on Vigilance Cases were arrived at and Special
 emphasis was taken to reduce the Pendency of Complaints, MIS Reports
 were sent to Statutory / Government Agencies like DoT-Vigilance and
 CVC.
 
 The Company observed Vigilance awareness week from 28th October 2013 to
 2nd November 2013 to 5th November 2013 at all Manufacturing Units
 including its administrative offices, as well as Corporate office.
 
 Periodical appraisals were also made to the Board of Directors on
 Vigilance Matters.
 
 The Vigilance department is endeavoring to lay far more emphasis on
 preventive vigilance, scrutinizing the documents and conducting
 surprise checks in sensitive departments. These actions had good impact
 for creating awareness amongst Company Executives on Vigilance aspects
 of Company Governance.
 
 19.  RIGHT TO INFORMATION:
 
 The RTI requests have been on the increase constantly. During the year
 2013-14, out of 254 RTI requests, information was provided against 203
 requests, 17 requests were rejected and 1 request was transferred to
 another Public Authority. The RTI returns on an quarterly basis have
 been submitted to the Ministry for forwarding the same to Central
 Information Commission and the same is published on our Company website
 also.
 
 20.  ENTERTAINMENT EXPENDITURE AND FOREIGN TRAVEL:
 
 The expenditure on entertainment was NIL.  Expenditure on offcial
 travel abroad by the offcials of the Company amounted to Rs. 0.86 lakh
 during the year.
 
 21. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO:
 
 Particulars with respect to Conservation of Energy, Technology
 Absorption and Foreign Exchange Earnings and Outgo, required to be
 disclosed under the Companies (Disclosure of particulars in the report
 of Board of Directors) Rules, 1988 are annexed.
 
 22.  PARTICULARS OF EMPLOYEES:
 
 The statement of particulars of employees drawing remuneration of Rs.
 60.00 lakhs and above per annum or Rs. 5.00 lakhs and above per month are
 required to be included in the Directors'' report as per Section 217(2A)
 of the Companies Act, 1956, read with Companies (Particulars of
 employees) Amendment Rules, 2011, are NIL for 2013-2014.
 
 23.  AUDITORS:
 
 Pursuant to Section 619(2) of the Companies Act, 1956, M/s. Sundar
 Srini & Sridhar, Chartered Accountants, Bangalore were appointed as
 Statutory Auditors of the Company for the year 2013-2014 by the
 Comptroller & Auditor General of India.
 
 The following firms of Chartered Accountants were appointed
 /re-appointed as Branch Auditors for different Plants of the Company
 for the year 2013- 2014:- M/s. Nagendra Gupta & Co.  Naini Plant,
 Allahabad
 
 M/s Mahadevan & Sivarajan, Palakkad Palakkad Plant
 
 M/s S D M & Co, Srinagar Srinagar Plant
 
 M/s Habibullah & Co., Gorakhpur Mankapur Plant
 
 M/s Rajesh Srivastava & Associates, Lucknow Rae Bareli Plant
 
 24.  COST AUDITORS
 
 Your Company has appointed M/s GNV & Associates, Bangalore, as Cost
 Auditors for the cost audit of south-based units located at Bangalore,
 Palakkad and also Consolidation for the Company and M/s Aman Malviya &
 Associates, Lucknow, as branch auditors for the cost audit of
 North-based units, located at Naini, Rae Bareli, Mankapur and Srinagar
 for the year 2013-14, with the approval of Board and Ministry of
 Corporate Affairs.
 
 25.  BOARD OF DIRECTORS:
 
 The following changes took place in the Directorate of your Company
 since the last Report.
 
 Shri R.K. Agarwal ceased to be a Director of the Company on 30th
 November 2013 on attaining the age of superannuation. In accordance
 with the requirements of the Companies Act, 1956, Shri P.K.  Gupta,
 Director-Marketing joined on 27th March 2014 and Shri S. Gopu,
 Director-Human Resources joined on 16th April 2014 will retire by
 rotation at this Annual General Meeting and eligible, offer themselves
 for re- appointment.
 
 Lt Gen Nitin Kohli joined the Board on 26th October
 
 2013 will retire at this Annual General Meeting and eligible offer
 himself for re-appointment as Director not liable to retire by
 rotation. Shri R.K. Mishra joined as Director not liable to retire by
 rotation on 25th July 2014 in place of Shri N. K. Joshi.
 
 26.  CORPORATE GOVERNANCE:
 
 A report on Corporate Governance along with a Compliance Certifcate
 from the Auditors as prescribed under the Listing Agreement with the
 Stock Exchanges on which the Company''s shares are listed, is annexed to
 this report.
 
 27.  MAJOR ORDERS RECEIVED AFTER 31ST MARCH 2014
 
 ITI Ltd bags the Prestigious Orders against NFS Project
 
 ITI Limited has bagged two advance purchase orders from BSNL amounting
 to Rs. 2984 Crore.
 
 These orders are part of Network For Spectrum (NFS) project for
 establishment of Optical Fiber Network through out the country.
 
 ITI is the only Central Public Sector Undertaking to bag two packages
 out of seven packages for NFS tender against stiff competition from
 multiple players.  These are the biggest orders ITI has ever got by
 competing in an open tender. These are the frst major orders received
 after the approval of the revival package of ITI, by Cabinet Committee
 on Economic Affairs (CCEA) and will open the doors for turning around
 the company.
 
 28.  DIRECTORS'' RESPONSIBILITY STATEMENT:
 
 Pursuant to the provisions under Section 217(2AA) of the Companies Act,
 1956 your Directors state that:
 
 (i) in the preparation of annual accounts, the applicable accounting
 standards have been followed and that there were no material
 departures.
 
 (ii) the accounting policies adopted by the Company have been applied
 consistently, judgments and estimates that are reasonable and prudent
 have been made so as to give a true and fair view of the state of
 affairs of the Company as at 31st March 2014 and Loss of the Company
 for the period ended 31st March 2014.
 
 (iii) they have taken proper and suffcient 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 and detecting fraud and other irregularities;
 
 (iv) the annual accounts have been prepared on a going concern basis.
 
 29.  AWARDS
 
 ITI Limited Mankapur Unit has bagged the prestigious National Safety
 Awards from the Ministry of Union Labour & Employment for the
 performance year 2011 and adjudged winner in two categories of
 ''Accident Free Year'' and ''Lowest Frequency Rate'' for the performance
 year 2011. ITI Ltd., Bangalore Unit is also adjudged runner up in
 ''Accident Free Year'' category for the same year. The awards were
 received on 18th September 2013.
 
 30.  SALES PROMOTION
 
 ITI Limited participated in SES 2013 Exhibition
 
 ITI participated in the ''Strategic Electronics Summit: Defence &
 Aerospace – SES 2013''. Organized by Electronic Industries Association
 of India (ELCINA) at HAL Convention Center, Bangalore on 2nd August
 2013. ITI displayed SDR systems at the exhibition.
 
 Dr. Ajay Kumar Joint Secretary, Department of Electronic & IT, Shri
 M.N. Vidyashanker, Secretary IT, Govt of Karnataka, Defence Offcials
 and other PSU Executives visited our stall.
 
 ITI Limited participated in INDIA TELECOM 2013 EXHIBITION at Vigyan
 Bhavan, New Delhi
 
 ITI participated in India Telecom-2013 Exhibition which was held at
 Vigyan Bhavan, New Delhi from 5th to 7th December 2013.
 
 Dr. Manmohan Singh, Hon''ble Prime Minister of India, inaugurated the
 India Telecom 2013 Exhibition. The theme of the event was Internet of
 People to Internet of Things: Future of Communication. Inauguration at
 the Exhibition Venue was done by Shri Kapil Sibal, Hon''ble Minister for
 Communication and IT & Law and Justice. The other dignitaries present
 at the ceremony with the Hon''ble Minister were Shri M.F.  Farooqui,
 Secretary, DoT; Smt. Rita Teaotia, Addl.  Secretary, DoT; Shri
 Umashankar, Joint Secretary, DoT.
 
 Products Displayed at ITI Stall:
 
 - Tablet PCs
 
 - Field Telephones
 
 - Decorative LED Lights
 
 - Solar Lantern with Panel
 
 - Biometric Hand Held Terminal (with charger)
 
 - Note Counting Machine
 
 - Fake Note Detector
 
 NSIC Buyer Seller Meet-2013
 
 ITI Mankapur has participated in the vendor development programme and
 Buyer and Seller Meet- 2013 organized by NSIC, Kanpur at Feroz Gandhi
 Inter College, Rae Bareli. The meet was held on May 15th & 16th, 2013.
 ITI Mankapur has exhibited Note Counting Machine (both Desk Top and
 Floor Model), Fake Note Detector, LED Decorative Lights (seven types),
 LED Bulb and LED Tube lights. There was a very warm response from the
 visitors to the stall who showed keen interest in our products.
 
 Shri K.H. Muniyappa, Hon''ble Minister of Micro, Small and Medium
 Enterprises, Govt. of India also visited our stall.
 
 31.  EVENTS
 
 Observance of Vigilance Awareness Week - 2013 Celebration
 
 Theme Promoting Good Governance – Positive Contribution of Vigilance.
 
 As per the directives of CVC, ITI observed the Vigilance Awareness Week
 from 28th October 2013 to 2nd November 2013, in all the Production
 Units as well as the Administrative offices of ITI Limited.
 
 The Vigilance Awareness week started with administration of the pledge
 on 28th October 2013 in all the Units and Administrative offices. At
 Corporate office, Shri K. L. Dhingra, CMD, administered the Vigilance
 pledge both in English and Hindi.
 
 World Telecommunication and Information Society Day - 2013 celebrated
 at ITI Bangalore Plant
 
 World Telecommunication and Information Society day was celebrated on
 17.05.2014 at ITI Bangalore Plant. The Theme for this year''s
 celebration was BROAD BAND FOR SUSTAINABLE DEVELOPMENT. Shri S. Gopu,
 Director (HR) welcomed the gathering.
 
 Shri K. L. Dhingra, CMD, presided over the function and emphasized the
 need of Broadband for sustainable development in his address.
 
 The Chief Guest of the function, Shri D.M. Ezhil Buddhan, GM-Telecom,
 Broadband Networks, BSNL delivered the Key note address.
 
 National Productivity Week – 2014
 
 National productivity week was observed from 12th to 18th February 2014
 at Bangalore plant. During the week, several Posters and Banners on
 Productivity Week and related messages were displayed all over the
 Factory premises. Essay and Slogan competitions were held on theme of
 the Year : Lean management to enhance productivity. Valedictory
 function of the Productivity week 2014 was held on 18th February 2014.
 
 Public Sector Day Celebrations at Corporate office and Bangalore Plant
 
 5th Public Sector Day was celebrated at ITI Corporate office on 16th
 April 2014. Shri K.L. Dhingra, CMD, and Vice Chairman, SCOPE addressed
 the gathering of all functional Directors and Senior officers of
 
 Corporate office and explained the importance of the PSU day and the
 contribution which Public Sector has made in the Economic Development
 of the Country.
 
 APEX Meeting Deliberates Key Issues
 
 APEX Meeting was held on 27th & 28th May 2013 at Banaglore Plant to
 deliberate key issues related to Company''s Revival, Orders, Financial
 status, Production targets and Marketing challenges. Shri K.L. Dhingra,
 CMD, Chaired the Meeting and called upon all the segments of ITI to
 redouble their efforts in every feld to turn around the Company.
 Functional Directors, Unit Heads, other Senior officers and
 representatives from the Employees'' Union and officers'' Association of
 all the Units participated in the deliberations.
 
 DoT team visits ITI Ltd Bangalore
 
 Smt. Rita A Teaotia, IAS, Additional Secretary (T), DoT visited ITI
 Corporate office on 3rd July 2013, along with Shri V. Uma Shankar, IAS,
 Joint Secretary (T) DoT, Shri N.K. Joshi, DDG (SU) and Shri R.K.
 Kaushik Director (PSU IV). Smt. Rita A Teaotia, planted a sapling in
 the garden area of Corporate office in the presence of DoT Team and Shri
 K.L. Dhingra, CMD ITI Limited.
 
 32.  ACKNOWLEDGEMENT:
 
 Your Directors place on record their sincere thanks for the assistance
 and support extended by the Ministry of Communications & IT and various
 other Ministries of Central and State Governments viz., Karnataka,
 Uttar Pradesh, Kerala and Jammu & Kashmir and look forward for their
 continued support and cooperation in future.
 
 Your Directors also wish to express their gratitude for the cooperation
 and assistance extended by BSNL MTNL, Banks, Suppliers, Shareholders,
 Bondholders, Depositors, Agents, Customers and Foreign Collaborators,
 Committee on Public Undertakings (COPU), Standing Committee on Public
 Enterprises (SCOPE) and Standing Committee on Information Technology.
 
 Your Board also expresses its sincere thanks to the Comptroller and
 Auditor General of India, Chairman and Member of the Audit Board and
 Statutory and Branch Auditors.
 
 Your Directors take this opportunity to place on record their
 appreciation for the valuable contribution made and excellent
 cooperation rendered by the employees at all levels for the progress
 and prosperity of the Company.
 
                                          For and on behalf of the 
                                             Board of Directors
 
                                                 (K. L. Dhingra)
                                  Chairman and Managing Director
 
 Place: Bangalore 
 Date: 13th August 2014
 
Source : Dion Global Solutions Limited
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