To The Members ITI Limited
 
 The Directors have pleasure in presenting the 62nd Annual Report of
 the Company together with Audited Accounts and Auditors'' Report thereon
 for the year ended 31st March 2012.
 
 PERFORMANCE:
 
 The Company was having MoU target of Rs.5300 Cr.  (sales) for the year
 2011-12. Against this MoU target, the Company has achieved Sales and
 Production of Rs. 922.09 Cr. and Rs. 924.94 Cr. during the year
 
 2011-12 as against Rs. 2138.93 Cr. and Rs. 2052.18 Cr. respectively
 during the previous year 2010-11.
 
 Due to reduced market share of Telecom PSUs, volume of ITI''s business
 with these customers has been severely affected resulting in to
 reduction in sales.
 
 The Company''s loss as worked out is Rs.369.80 Cr.  for the year
 2011-12. Despite the reduced sales turn- over, contribution in the year
 2011-12 has increased to Rs 180.51 Cr. as compared to Rs. 160.10 Cr. in
 the year2010-11.
 
 During the year 2011-12, the Company received fresh orders of Rs. 1610
 Cr. approximately.
 
 The Company has signed MoU of Rs. 4430 Cr.  (Level-3) for the year
 2012-13 with projected gross margin of Rs. 164 Cr. and Net Profit/loss
 at par.
 
 HIGHLIGHTS:
 
 The turnover for 2011-12 is mainly from National Population Register
 (NPR), GSM Projects, GPoN, IT Project and Service Contracts of Defense
 and Civil networks.
 
 Your Company executed e-Governance Project of Registrar General of
 India (RGI) on a large scale as part of consortium of BEL & ECIL and
 registers sales of Rs.438.07 Cr. during the year. Another milestone
 achieved by the Company in execution of APDRP Project of Tamil Nadu
 State. The Company did a total business of around Rs.200 Cr. In IT and
 other turnkey projects mainly through its presence of Regional Offices
 situated in various parts of Country.
 
 The supplies of Major Products and execution of projects during the
 year are as follows:
 
 NPR Project of Rs. 438.07 Cr., GSM Rs.59.16 Cr., G-PoN, Rs. 24.24 Cr.,
 Defence Projects and Services Rs.52.20 Cr., ADSL-CPEs Rs. 5.27 Cr.,
 SMPS Rs.3.76 Cr. Radio Modem Rs. 17.50 Cr., AMC of OCB 283 exchanges
 Rs. 47.14 Cr., IT Project Rs. 90.02 Cr. and business through Regional
 Offices Rs. 107.87 Cr.
 
 PRODUCTION
 
 The product-wise details of performance achieved by the Company during
 the year 2011-12 as compared to the previous year is as given below:
 
 f1 in Crores
 
 Sl.No. Product/Project                           2011-12    2010-11
 
 1.     OCB-283 CORE inc. I/C                           _       3.81
 
 2.     Radio Modem                                 17.50          -
 
 3.     SSTP/IP TAX                                 12.28       1.77
 
 4.     C-DOT Products                               4.57       4.38
 
 5.     Diversified                                  4.15      32.84 
        Products/Cont.Mfg.
 
 6.     Optic Fibre Equipments                          _      45.67
 
 7.     Solar Panel                                  6.87          -
 
 8.     PCM MUX                                      3.84      14.34
 
 9.     DWDM                                         9.21      56.96
 
 10.    MLLN                                            _       2.41
 
 11.    EPBT/CLIP Phones                                _       8.11
 
 12.    GSM - WZ (Incl. BTS,                        32.70     909.09 
        RTT, Shelter & AMC )
 
 13.    GSM - MTNL                                  18.44      19.37
 
 14.    GSM - SZ                                    13.64     593.06
 
 15.    WLL - INFRA                                 14.88      14.96
 
 16.    ADSL-CPE                                     5.13      37.47
 
 17.    Misc. Products & Services                   34.37      16.93
 
 18.    Defence / ASCON                             52.20      54.77
 
 19.    OCB AMC Business                            47.14      45.22
 
 20.    USIM / SIM Cards                             0.28       6.09
 
 21.    NPR                                        438.07      11.46
 
 22.    SMPS                                         3.76      14.94
 
 23.    G-PoN                                       24.24     119.98
 
 24.    ROs / CCO / IT                             197.89     125.28
 
 25.    Data Centre                                 10.69          -
 
 
        TOTAL (Incl. ED)                           922.09    2138.93
 
 
 NEW PRODUCTS:
 
 b Carrier Ethernet: Carrier Ethernet is the next generation transport
 technology for high bandwidth packet access for internet and business
 communication. ITI has identified a technology partner to address
 anticipated tender from BSNL. The NFS (Network for Spectrum) project is
 expected to have a huge requirement for Carrier Ethernet switches.
 Tender are expected in
 
 2012-13.
 
 b G-PON: G-PON is a promising transmission technology in terms of its
 low operating expenses, low power requirements and ease of network
 deployment. Huge requirements are anticipated from projects like NOFN,
 NFS and others. ITI has already been a major supplier of this product
 to BSNL and MTNL using the technology from M/s Alphion, USA. ITI has
 now entered into a TOT agreement with M/s C-DOT and manufacturing of
 G-PON equipments from component level is under process at Raebareli
 plant using C-DOT technology. This will boost indigenous manufacturing
 in India.
 
 b National Population Registration (NPR) and Socio Economic & Caste
 Census (SECC) projects: ITI is one among the consortium of three PsUs
 selected for the execution of prestigious NPR project. The job involves
 collection of citizen data including biometrics followed by issue of ID
 cards. ITI has already received an order to the tune of Rs 750 crore
 against this project from RGI for data collection including Biometrics
 which is under execution. Further orders are also anticipated.
 
 An order to the tune of ? 450 crore has also been received for SECC (
 Socio-Economic Caste Census) project from the Ministry of Rural
 Development which is also under execution by the same consortium. This
 project involves additional census data of all the citizens in the
 Country.
 
 b Migration of C-DoT TDM switches to NGN: ITI has manufactured the
 control card for migration of existing C-DoT exchanges to NGN. The
 manufacturing and testing of card has been approved by C-DoT. It is in
 line to the initiative of Ministry for bringing synergy in various
 organization under its control.
 
 b GSM : ITI has been implementing GSM Projects in BSNL West Zone &
 South Zone and MTNL- Mumbai, in technology alliance with M/s Alcatel-
 Lucent [BSNL-West Zone & MTNL] and with M/s Huawei [BSNL-South Zone].
 Huge demands are anticipated for GSM-3G equipments for expansion of
 BSNL/MTNL and other private operators networks. ITI is manufacturing
 BSS network equipments in-house.
 
 Non-Telecom products :
 
 b 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. ITI is having requisite expertise
 and experience for implementing Solar solutions.
 
 BSNL and other Service Providers are planning to upgrade their outdoor
 GSM Telecom BTS sites with Solar Power specially in rural areas where
 power supply position is not good. The requirement will be around 4,000
 BTS sites/year.  ITI Naini has installed equipments required for
 assembly and testing of solar module for 40 MW capacity. ITI has bagged
 two orders for supply of Solar Equipment of value Rs.35 Cr.
 
 b LED Lighting: LED lighting is an environmental friendly option 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.
 
 b Data Center: ITI established Tier 3  state-of-art Data center at
 Bangalore on PPP model.  Presently this Data Center is fully booked for
 co- location services.
 
 Big scope exists in the market of Data center considering the immense
 potential in the Government sector to store data for projects of
 national importance like NPR, UIDAI and other Projects/Schemes
 envisaged by Government agencies & PSUs. In line with the business
 opportunities, ITI is planning to build its own Data centers as main
 and disaster recovery sites at 2-3 locations.
 
 b IT Projects: All 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 has already executed
 SWAN (State Wide Area Network) projects of Maharashtra, Odisha and
 Mizoram. ITI is also executing Accelerated Power Development and Reform
 Programme (APDRP) of Tamil Nadu state. e-Tendering is another major
 project being
 
 executed by ITI. ITI has also got orders of IT projects from Bihar &
 Nagaland States and UID projects in various States.
 
 EXPORT:
 
 The exports of the Company for the year 2011-2012 was NIL
 
 FINANCE:
 
 The performance of the Company for the year 2011-2012 as compared to
 the previous year is as follows:
 
                                                         (Rs.in Crs.)
 
 SI     Particulars                           2011-2012    2010-2011
 NO. 
 
 1      Sales including services                    922         2139
 
 ii.    Value of Production                         925         2052
 
 iii.   Loss before tax                             370          358
 
 iv.    Loss after tax                              370          358
 
 v .    Financing Expenses                           85           66
 
 vi.    Depreciation                                 21           22
 
 vii.   Capital Employed                           1893         2142
 
 viii.  R&D Expenditure                              21           19
 
 
 DIVIDEND:
 
 As your Company has incurred a loss, the Directors are not in a
 position to recommend any dividend for the year 2011-2012.
 
 HIGHLIGHTS OF THE PRODUCTION PLANTS AND SERVICE UNITS: BANGALORE PLANT:
 
 Bangalore Plant achieved a turnover of Rs.45.24 Cr.  Supplies consists
 of, Defense equipment of Rs.10.08 Cr, ADSL-CPEs worth Rs. 0.29 Cr., PCM
 MUX, etc. worth Rs.3.84 Cr., Switching equipment, OCB-CSN / C-DoT /
 Microwave items, AmC & repair etc. worth Rs. 4.08 Cr, Data Centre''s
 turnover worth Rs. 10.69 Cr, and Radio Modem worth Rs.  17.50 Cr. and
 roll back of Rs. 14 88 Cr. against WLL CDMA earlier PO value.
 
 MANKAPUR PLANT:
 
 Mankapur Plant has achieved a turnover of Rs.57.41 Cr ., Out of this
 C-DoT products worth Rs 4.57 Cr., ADSL-CPE worth Rs.4.98 Cr. Banking
 product worth Rs.2.04 Cr, and Misc. Products worth Rs.0.30 Cr. were
 supplied.
 
 The Plant has bagged 2 Nos. National Safety Award - Performance Year
 2009 - WINNER for lowest
 
 average accident frequency rate and Performance Year 2009 - WINNER for
 accident free year.
 
 Smt. Mamta Dubey and Smt. Suman Srivastava of these plant bags Prime
 Minister''s Shram Devi Award for the year 2008 and 2009 respectively.
 
 RAE BARELI PLANT:
 
 Rae Bareli Plant achieved a turnover of Rs.61.73 Cr, SMPS worth Rs.
 3.76 Cr., Rs. 24.24 Cr. from the supply of G-PoN equipments, Rs. 28.40
 Cr worth of GSM Franchise and GSM (BTS) TRU Expansion worth Rs. 5.33
 were supplied.
 
 The Plant has bagged National Safety Award for lower average frequency
 rate of accident Scheme-1 (Runner) & longest accident free period
 Scheme-2 (Winner) from Ministry of Labour & Employment for
 Performance year 2008 conferred on 27th September 2010.
 
 NAINI PLANT:
 
 Naini Plant achieved a turnover of Rs.16.20 Cr.  Supplies consist of
 DWDM equipment worth Rs.  9.21 Cr., Solar Panel worth Rs. 6.87 Cr. and
 misc./ contract mfg. worth of Rs. 0.12 Cr. This plant has initiated for
 upgrading the manufacturing facility of manufacturing of PV Solar
 Panels during the year.
 
 PALAKKAD PLANT:
 
 Palakkad Plant achieved a turnover of Rs.451.74 Cr. Which is highest
 ever since its inception. The Plant supplied MLLN equipment worth Rs.
 12.28 Cr, NPR Project worth Rs.438.07 Cr. and Misc. / Contract
 Manufacturing worth Rs. 1.40 Cr.
 
 The Plant has achieved notable performance in NPR 57 Data collection,
 Bio-metric Enrolment, Data Capture and for SECC Project, NPR Card
 production.
 
 Palakkad Plant received First Prize in Industrial Safety from National
 Safety Council, Kerala Chapter for Medium Size Engineering Industries
 and also from Department of Factories and Boilers, Government of
 Kerala.
 
 SRINAGAR PLANT:
 
 Srinagar Plant achieved a turnover of Rs.0.02 Cr.  against services.
 
 NETWORK SYSTEMS UNIT:
 
 Network Systems Unit achieved a turnover of Rs.91.86 Cr mainly
 comprising of Annual Maintenance Contract for OCB exchanges worth Rs
 47.14 Cr. for BSNL & MTNL, AMC for ASCON Project worth Rs. 42.12 Cr.
 and Misc./ contract jobs worth of Rs 2.60 Cr.
 
 REGIONAL OFFICES :
 
 Regional Offices and its Customer Care Organization (CCO) achieved a
 turnover of Rs. 197.89 Crs. Overall growth was 58% higher compared to
 previous year''s performance. This turnover consists of Rs. 69.77 Crs
 supply of ITI''s mfg. products and other traded products, Rs.33.58 Crs.
 of Services and Rs.5.07 Crs.  by various CCOs and Rs 90.02 Cr. towards
 IT Projects of services of old exchanges. During the year 2011- 12, 6
 Regional offices out of 8 have reported gross profit for the first time
 in last 5 years and 5 have reported net profit.
 
 GSM Projects:
 
 The Company rolled out GSM Network worth of Rs.  40.72 Cr. against BSNL
 orders in WZ & SZ and Rs 18.44 Cr against Orders in MTNL, Mumbai.
 
 Future Outlook:
 
 b Software Defined Radio (SDR): Software defined radio cater to
 single radio covering HF, VHF and UHF range for voice and low bit-rate
 voice and data applications. Defence sector plans to replace existing
 radios namely combat net radios with SDR. These radios have Electronic
 counter Measures (ECCM) features to avoid jamming. ITI is planning ToT
 with an Original Design agency for manufacturing and supply of SDRs for
 both Defence and Civilian use.
 
 b Network for Spectrum (NFS): This project is allocated to BSNl by
 Ministry of Communications for setting up of a communication backbone
 network in lieu of release of spectrum by Defence.  ITI is anticipating
 substantial order from BSNL for laying of Optical fiber cables for this
 project as well as supply and installation of transport equipment.
 
 b Broadband to rural sector: In line with the Government''s mission to
 provide Broadband
 
 connectivity to the rural masses under Bharat Nirman, 2,50,000
 villages are planned to be connected by optical fiber under National
 Optical Fiber Network (NOFN) project. ITI is leveraging this
 opportunity using the G-PON technology of C- DOT.
 
 b Defence projects: ITI has supplied telecom equipment like
 Telephones, Ruggedized Telephone Exchanges, Transmission equipments,
 VSAT etc. to the Defence sector.  ITI has successfully implemented
 communication network to Indian Army viz.  ASCON Phase-I, II, III on
 turnkey basis and also maintaining the project under AMC.
 
 ITI is the major supplier of Encryption equipment to Defence for its
 communication network.
 
 To enhance product portfolio in Defence segments following technologies
 are being planned by ITI :
 
 b Satellite Trans-Receiver and Access equipments.
 
 b RADARs and Allied Equipments.
 
 b Weapon Control Systems.
 
 b Navigation Systems and Equipment.
 
 b Missile systems and Equipments.
 
 b Electronic fuzes.
 
 b ASCON Phase IV for Indian army: ITI has already executed ASCON
 Phase I, II & III projects. Total maintenance support is also being
 given for these projects by ITI. The ASCON Phase IV order is also
 anticipated by ITI.
 
 b Citizen ID cards: As a part of National Population
 
 Register, ITI, along with its consortium partners, looks at the huge
 opportunity of manufacturing Smart card based citizen identity cards
 for all the citizens in the Country.
 
 CONTRIBUTION TO EXCHEQUER:
 
 During the year, your Company has contributed ''.
 
 57.64 Crs to the exchequer towards duties and taxes.
 
 PUBLIC DEPOSITS:
 
 Value of deposits held by the Company was NIL.
 
 Deposits aggregating to Rs. 0.24 Crs. had matured for
 
 payment, but were not claimed on due dates.
 
 JOINT VENTURES : 1.  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
 Pacific International Company (EPIC). Both EPIC and UTI had sold their
 respective stakes in ISL to M/s Chris Tech Systems Pvt. Ltd. (CTSPL)
 and ITI had also took steps to sell its entire 49% equity stake in ISL
 to CTSPL. The Government of India, Ministry of Communications & IT vide
 their 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 can not be effected. Now the shareholder in the Joint Venture
 are ITI (49%) and CTSPL (51%).
 
 QUALITY:
 
 The Quality Policy of ITI is to [provide Competitive and Reliable
 Products, Solutions and Servicesb.  Quality Assurance (QA) wings have
 been well established in all the production units of ITI Ltd. The QA
 wings are responsible for Quality of products & services rolling out of
 units. The Units are well equipped with a variety of Environmental test
 facilities. Test systems and instruments for carrying out elaborate
 tests for conducting Reliability Evaluation on all products to ensure
 customer satisfaction. This is achieved by sound and effective Quality
 Management Systems.
 
 The guidance and support to all Units for Training, Implementation,
 Surveillance and Recertification of ISO 9001:2008, Quality Management
 System (QMS) and ISO 14001:2004 Environmental Management System (EMS)
 is provided by Corporate Quality. Quality related MOU targets and
 Quality related issues like AIS, SPC, Six Sigma, 5S, TQM Quality Cost
 etc.
 
 The five Plants at Bangalore, Palakkad, Mankapur, Rae Bareli & Naini of
 the Company have been accredited with and periodically upgraded to
 International ISO 9001:2008 Standards of Quality Management as on date.
 
 Keeping in tune with the Global concern for Environmental Management,
 all the plants of the Company have gone in for ISO 14001:2004 EMS
 certification for all of the Plants.
 
 BSNL has granted AIS (Approved Inspection Scheme) status by BSNL QA for
 SIM Cards.  Localisation activities continued during the year to
 procure items such as cables, connectors and PCBs for GSM-BTS Project
 with Alcatel approval and after approval from VDC & VRC of R&D,
 Bangalore. CAG, VDC, VRC, Standards, Component Testing and Reliability
 Labs provide Qualification Approval, Standardisation of Electronic
 components, Vendor Development and Vendor Rating after stringent
 evaluation in Testing in Reliability and Environmental laboratory.
 
 MANPOWER
 
 Employees Strength at the end of the year 31st March 2012 was 9512 when
 compared to previous year''s strength at 10616.
 
 As on 31.03.2012, there were 1630 employees belonging to Schedule
 Castes and 79 belonging to Schedule Tribes employees, thus constituting
 17.13% and 0.83% respectively of the total strength of employees on the
 rolls of the Company. 2 Contract Engineers belonging to SC Category & 1
 belonging to ST Category, 25 Technicians belonging to SC and 1
 belonging to ST were recruited on contract basis during the year
 2011-2012.
 
 Employees belonging to Ex-servicemen category numbering 41 and
 Physically Challenged Persons numbering 120 were on the rolls of the
 Company as at the end of the financial year.
 
 HUMAN RESOURCE DEVELOPMENT:
 
 Human Resource Development (HRD) initiatives, with organizational turn
 around and diversification attempts in focus and in tune with the MOU
 target on HRM - targets for 2011-12 were set to impart training for 8%
 of executives and 7% of non-executives strength in the areas of New
 Technology, Information Technology, Employee Development, besides skill
 development across various functional areas by organizing 50 and 30
 number of training programmes for officers and non-officers
 respectively. ITI achieved ''excellent rating'' under the MOU for this.
 
 Another target for the year was, for the first time in the company - as
 part of the MOU criteria, to conduct the SKILL Gap Analysis, involving
 all the trainable employees of the company.
 
 These twin objectives were basically intended to meet the immediate
 training requirements of the company for the year under reference and
 to gear up the HRD training initiates on the findings of the Skill GAP
 Analysis, for subsequent years, to supplement the company''s turn around
 the diversification agenda.
 
 The Company has surpassed the MOU targets for 2011-12 on HRM-Training
 criteria by internally training 2199 i.e., 45.54% of 4819 officers and
 915 i.e., 15.8% of 5797 non-officers strength (as of 1-4- 2011) through
 organizing a total of 97 in-house training programmes. This performance
 includes the 31 executives trained externally and the 5 executives
 trained by MOU partners in Project / Product specific training.
 
 To keep pace with the advancements in Telecom training programmes on
 the topics like GPON, WiMAX, SDH, DWDM, Broad Band, Migration from IPv4
 to IPv6, Embedded System were organized.  On the IT front, training
 programmes were conducted on ''e-tendering'' as part of development and
 implementation of the e-tendering system in the company. IT programmes
 also included awareness programmes on NPR Projects, Biometrics etc.,
 Management Development programmes focused on Personality Development,
 Preventive Vigilance, Public Procurement, besides host of other areas
 like Quality, Finance, Reservation Policy for SC/ST.  General Awareness
 programmes, keeping the company''s CSR endeavors, focused on topics
 like, Environment Management System, Energy Conservation, Industrial
 Health, Safety etc,., In a nutshell, during the year company had
 trained over 3078 employees and achieved 3733 training mandays.
 
 Corporate HR (ED), in its efforts to minimize the training costs,
 thrust was given to, develop and engage more and more officers as
 internal resource persons for conducting the training programmes, and
 employ video conferencing method for conducting training programmes
 company-wide, at a stretch covering more than 200 participants.
 
 INDUSTRIAL RELATIONS
 
 The Industrial Relations scenario in the Company was cordial during the
 year 2011-12. The Unions and Officers'' Associations extended their full
 co- operation and support in ensuring smooth work flow and helped to
 meet the Company''s objective.
 
 OFFICIAL LANGUAGE:
 
 All Units / Offices have established Check-points in their concerned
 offices to make more efforts for effective Implementation of the
 Official Language Policy, monitored by the Official Language
 Implementation Committees constituted in every Unit / Office.
 
 The Progress of Implementation of Official Language in our Corporate
 Office as well as in our all subordinate Units / Offices is also being
 periodically reviewed by the OLIC Committee of Corporate office.
 
 In order to enhance the working knowledge of Official Language amongst
 our employees, officials 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 Official
 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 notified in the Gazette of India as per OL Rules 10
 (2) & (4), 1976.
 
 For Bangalore based Units/Offices, a short term Hindi Unicode training
 programme were organized in the HRD deptt. of Corporate Office, with
 the help of Senior Hindi Officer, NAL, 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.  Official Language Cell
 had achieved the Best Excellence Performance Award during the
 year 2010-2011 from the President, Town Official Language
 Implementation Committee, Bangalore for remarkable progress and
 significant achievements for the use of Hindi and implementation of
 Official Language in the company.
 
 After reviewing our quarterly report, an appreciation letter was also
 received from Dy.Director-OL, Official Language Department DoT, New
 Delhi as well as Dy. Director (Implementation), Regional Implementation
 Office, Bangalore.
 
 A Joint Hindi Fortnight Programme for Bangalore based PSUs /
 Organisations between 03.10.2011 & 31.10.2011 was organized by TOLIC,
 Bangalore and various types of competitions were arranged during this
 occasion. On this occasion many officers/Non-officers of ITI Limited,
 Bangalore based Units / Offices participated in these competitions and
 more than 14 Officers / Non-Officers have got the prizes. On the TOLIC
 Meeting & valedictory function held on 05.12.2011, the President, TOLIC
 were given the cash prizes and certificate to the wining participants.
 
 [Hindi Fortnight] was celebrated and Hindi Workshops were organised
 for encouraging progressive use of Hindi during 2011-12.  Company''s
 website has been made bilingual (i.e.  English and Hindi).
 
 VIGILANCE:
 
 During the year, Vigilance Department functioned as an effective part
 of Management. The main focus of the vigilance activities was to
 sensitize the employees towards transparent, ethical and professional
 approach towards their duties and responsibilities. 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, review of
 Procedure being followed for selection of Technology Partners,
 Securitization of ITI assets, Formulating Project- Specific-Accounting
 Policies in the Company, implementation of Rotational Transfer of
 Executives in Sensitive Areas, implementation of Whistle Blower Policy
 in the Company etc.
 
 The Company observed Vigilance awareness week from 31st October 2011 to
 5th November 2011 at all Manufacturing Units of ITI Limited including
 its administrative offices, as well as at Corporate Office.  Open-house
 discussions were held with Middle Management Executives of the Company,
 with specific emphasis on streamlining the Systems and Procedures in
 Procurement and recording the Reasons for proposing / taking requisite
 Commercial /Administrative decisions. The main thrust was also to
 enhance the Vigilance Awareness across the Company and provide a
 platform for the participants to interact, seek more information and
 clarify doubts on vigilance concepts and functions.
 
 Impetus was given to review the pendency of Cases periodically to
 expedite logical conclusions of the pending cases. Periodical
 appraisals were also made to the Board of Directors on Vigilance
 Matters.
 
 The Vigilance department is endeavoring to lay more emphasis to
 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 Facets
 of Company Governance.
 
 RIGHT TO INFORMATION:
 
 Ever since the introduction of Right to Information Act, 2005, there
 has been a reasonable increase in the number of information seekers.
 The number of requests received during 2011-12 was 358 in comparison to
 the requests of previous year of 321.  As a part of mandatory
 requirement, the returns are now being submitted every quarter to our
 Ministry for onward submission to Central Information Commission.
 
 At present, we have a designated Public Information Officer for every
 unit and a CPIO at Corporate Office.  The first appeals are being
 addressed by Appellate Authority at Corporate level. The Transparency
 Officer has been nominated to ensure the overall compliance of the RTI
 Act and as a single window interface with the public and the Central
 Information Commission.
 
 The retention schedule of records has been formulated and being
 implemented which is one such step of our dedicated and sincere efforts
 of RTI Cell in complying with relevant provisions under RTI Act for
 transparency.
 
 AWARDS:
 
 EVENTS & Awards:
 
 Two ITI Women Employees Honoured with PM''s Shram Award
 
 Two employees of ITI Ltd Ms. Mamta Dubey and Ms. Suman Srivastava
 received the Prime Minister''s Shram Award from Dr. Manmohan Singh at a
 function in New Delhi. Mr.K.L.Dhingra, CMD of ITI Ltd was also present
 on the occasion. Ms. Dubey developed a machine based test and repair
 set-up for turret board and main display boards of note counting
 machine, thus making the product more reliable and reducing the testing
 time, earlier this was a manual process. Ms. Srivastava''s contribution
 in Transreceiver (TRA module) assembly resulted in process
 simplification and zero rejection by remodelling the Jigs and has
 resulted in significant improvement in increasing productivity almost
 to the time of 23%. Both are employees of ITI Mankapur in Gonda
 District of Uttar Pradesh.
 
 ITI Ltd. has bagged the prestigious ''National Safety Awards'' from the
 Ministry of Labour & Employment for the performance year 2009. Mr. K.
 L. Dhingra, CMD, ITI Ltd, received these awards from Mr. Mallikarjun
 Kharge, Minister for Labour & Employment at a function in New Delhi on
 November 29,2011.
 
 ITI''s Mankapur Plant emerged as the winner in the scheme I (based on
 the lowest average frequency rate) and scheme II (based on accident
 free year). ITI''s Rae Bareli Plant was runner-up in the lowest average
 frequency rate of accident (scheme I).
 
 ITI participated in the prestigious INDIA TELECOM 2011
 
 ITI participated in the prestigious INDIA TELECOM 2011, 6lh
 International Exhibition & Conference organized by DoT and FICCI on
 December 7-9, 2011 at Pragati Maidan, New Delhi. The theme of event was
  Total Solutions for Global Communications.
 
 Mr. Milind Deora Focuses on ITI''s Revival, Inaugurates Gas Plant
 
 Mr. Milind Deora, the Union Minister of State for Communication and
 Information Technology, visited ITI on October 29,2011 and discussed
 issues related to ITI''s revival, its financial performance, manpower,
 Research and Development, its diversification and revival strategies.
 We have to revive and we want to revive ITI, he told the senior
 executives of the Company at a presentation held on the Company''s
 revival strategy at the Corporate Office. Mr. K. L. Dhingra, CMDof ITI
 Ltd welcomed Mr. Deora and briefed him about the Company activities.
 
 Honorable Union Minister Mr. Kapil Sibal Inaugurates ITI Lab., Assures
 A Smile Back on ITI
 
 Mr. Kapil Sibal, Union Minister of Communications & IT and HRD,
 inaugurated New Products Lab at ITI on February 6, 2012 and said
 his Ministry would do everything possible to revive ITI and bring
 back smiles on faces of employees. Your company has been a
 backbone of telecom industry and we will not allow it to go down, he
 told to the packed audience at ITI Plant. Mr. R. Chandrashekhar,
 Secretary DoT and Mr. K.L. Dhingra, CMD of ITI, employees and top
 officials from Defence, Banks and other PSUs were present on the
 occasion.
 
 DoT Secretary Visits Bangalore Plant
 
 Mr. R. Chandrashekhar, Secretary DOT, visited Bangalore plant on
 February 6 2012. In the SMT Line, ITI Officials brief in about SMD
 populated cards. They also explain to him the features and capabilities
 of the line, as well as in-circuit tester being used.
 
 ITI Moll Concentrates on Revival Plans
 
 ITI signed a Memorandum of Understanding (MoU) with the Government for
 the year 2012-13.  Mr.R.Chandrasekhar, Secretary, DoT and Chairman,
 Telecom Commission and Mr.K.L.Dhingra, CMD, ITI Ltd.  signed the MoU in
 New Delhi on March 12,2012.
 
 The thrust areas of MoU include pursuing growth opportunities in
 telecom sector and exploiting diversified businesses such as renewable
 energy. The MoU envisages that ITI concentrate on revival plans with
 due approval of the Government agencies. The Company has also committed
 to follow DPE guidelines for the Corporate Governance, Corporate Social
 Responsibility, Research & Development and Human Resources Management.
 The Company will also address other critical issues such as up
 gradation of plant infrastructure and reduction of surplus manpower
 through VRS.
 
 ITI''s Maiden Venture at DEFEXPO 2012
 
 ITI Ltd has participated in DEFEXPO 2012 for the first time. The
 exhibition is being held in New Delhi from March 29 to April 1, 2012.
 ITI has showcased its products and services relevant to the defence
 sector.  Mr. A. K. Antony, Union Defense Minister visited the ITI stall
 where he was received by Mr.K.L.Dhingra, CMD, ITI Ltd. Dr. M. M. Pallam
 Raju, Minister of State for Defence and Dr. Vijay Kumar Saraswat,
 Scientific Advisor to the Minister of Defence were present on the
 occasion. The dignitaries were briefed about ITI activities and its
 contribution to the defence sector communication activities.
 
 Secretary DPE Visits ITI
 
 Mr. O.P. Rawat (IAS), Secretary, Department of Public Enterprises
 (DPE), visited ITI''s Corporate Office and Bangalore Plant on April 27,
 2012 and discussed several issues related to ITI''s business with senior
 executives at the Corporate Office.
 
 Mr. O.P. Rawat (IAS), Secretary, Department of Public Enterprises
 (DPE), planting a sapling at ITI''s Bangalore Plant. Mr. K.L. Dhingra,
 CMD, Mr. R. K. Agarwal, Director - Marketing, Mr.K.K Gupta, Director-
 Production, Mr.Ravi Khandelwal, Director-Finance and other Senior
 Officers of the Company were present on the occasion.
 
 World Telecommunication and Information Society day
 
 World Telecommunication and Information Society day has been celebrated
 for the year 2012 and the Theme selected by International
 Telecommunication Union (ITU) was WOMEN AND GIRLS IN ICT.
 
 As part of the Program a combined valedictory function of World
 Telecommunication and Information Society day was held on 17.05.2012 at
 Bangalore Plant. Lt. Col. A M Uniyal (Retd), GM- B welcomed the
 gathering.  Mr.P.Raghavan, Chief General Manager, BSNL Karnataka
 Telecom Circle was the Chief Guest of the program and delivered the Key
 note address. Mr. K L Dhingra, CMD ITI Ltd. in his presidential address
 emphasized the need of Technology towards Women and Girls in ICT He
 further stated that ITI will put all out efforts to ensure that women
 and girls are benefited from the technology. Mr. K K Gupta, Director-
 Production, Mr. Ravi Khandelwal, Director-Finance, Mr.RVenkataraman,
 Chief Vigilance Officer gracing the function.
 
 ENTERTAINMENT EXPENDITURE AND FOREIGN TRAVEL:
 
 The expenditure on entertainment was NIL. Expenditure on official
 travel abroad by the officials of the Company amounted to'' 0.50 lakhs
 during the year.
 
 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.
 
 PARTICULARS OF EMPLOYEES:
 
 The statement of particulars of employees drawing remuneration of 60.00
 lakhs and above per annum or 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, as amended, are NIL for 2011-2012.
 
 AUDITORS:
 
 Pursuant to Section 619(2) of the Companies Act, 1956, M/s. Badari,
 Madhusudan & Srinivasan, Chartered Accountants, Bangalore were
 appointed as Statutory Auditors of the Company for the year 2011-2012
 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
 forthe year 2011-2012:-
 
 
 M/s. Nagendra Gupta & Co., Naini Plant, Allahabad
 
 M/sThrivikraman &Co., Palakkad, Palakkad Plant
 
 M/s Samriti &Associates, Jammu, Srinagar Plant
 
 M/s Habibullah &Co., Gorakhpur, Mankapur Plant
 
 M/s S. C. Singh & Co., Rae Bareli, Plant
 
 
 BOARD OF DIRECTORS:
 
 The following changes took place in the Directorate of your Company
 since the last Report.
 
 In accordance with the requirements of the Companies Act, 1956, Shri M.
 Balakrishnan, Independent Director, and Dr. S. K. Chaudhuri,
 Independent Director will retire by rotation at this Annual General
 Meeting and eligible, offer themselves for re-appointment.
 
 Your Directors wish to place on record their appreciation of the
 services rendered by Shri A.K.Srivastava, Shri N.K.Srivastava, Lt. Gen.
 P. Mohapatra during their tenure.
 
 
 CORPORATE GOVERNANCE:
 
 A report on Corporate Governance along with a Compliance Certificate
 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.
 
 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 2012 and Loss of the Company
 for the period ended 31.3.2012.
 
 (iii) they 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 and detecting fraud and other irregularities;
 
 (iv) the annual accounts have been prepared on a going concern basis.
 
 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 co-operation in future.
 
 Your Directors also wish to express their gratitude for the
 co-operation and assistance extended by BSNL and 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
 co-operation rendered by the employees at all levels for the progress
 and prosperity of the Company.
 
 
                                           For and on behalf of the 
                                                 BOARD OF DIRECTORS
 
 Place : Bangalore                                   (K. L. DHINGRA)
 Date:11.08.2012                     CHAIRMAN AND MANAGING DIRECTOR