1.  Execution and registration of sale deed for assets sold to DRDO for
 Rs. 26 Crores during 2003-2004 is under process consequent to the
 receipt of Ministry approval.
 
 2.  As per the Presidential directives and Tripartite agreement on wage
 settlement with employees, wage revision arrears for the period from
 01.01.1997 to 31.03.2000 is to be paid by the Company in a phased
 manner on the improvement of profitability position and also generation
 and availability of funds.  Since the company has already been declared
 by BIFR as a sick company and the condition for payment of wage
 revision arrears as per directives/agreement aforesaid are not
 prevalent, company has not provided any liability for payment of
 arrears of wage revision for this period amounting to Rs. 165 Crs. This
 amount has been included in the Draft Rehabilitation Scheme(DRS)
 submitted to BIFR.
 
 3.  Interest on Royalty payable to C-DOT has not been provided in view
 of substantial dues (which are more than the royalty amount)
 outstanding for a long time from C-DOT on account of Rent payable on
 our premises leased out to them. The issue is under
 correspondence/discussions with DoT and C-DoT.
 
 4.  In case of back to back arrangements, Liquidated damages is
 accounted on net basis.
 
 5 Redemption installments in respect of the following Cumiulative
 Redeemable Preference shares issued by the company have not been paid
 on due dates on account of fund constraints
 
 6 A list of micro, small and medium enterprises to whom the Company
 owe any sum together with interest outstanding for more than 30 days to
 the extent identified.
 
 i.  Crystalonics Displays (P) Ltd. Bangalore
 
 ii.  Fasteners & Industrial Components Bangalore
 
 iii.  Latha Plastronics Bangalore
 
 iv M R Engineers Bangalore
 
 v Maruthi Rubber Products Bangalore
 
 vi Protectron Electromech (P) Ltd. Bangalore
 
 vii S K Electronics Industries Bangalore
 
 viii Sri Kumar Packing Products Bangalore
 
 ix Sri Shakti Industries Bangalore
 
 x Udaya Insulated Cable Co. Bangalore
 
 xi Universal Agencies Bangalore
 
 xii Woody Industries Kerala
 
 7 Balances in the accounts of creditors, debtors, advances from
 customers, some bank accounts, Claims recoverable, loans and
 advances,materials with fabricators, sub-contractors/others, material
 in transit, deposits, Loans, Creditors, Sales Tax,VAT, Excise
 Duty,Cenvat, Service Tax are under confirmation/reconciliation
 
 8 Claims and expenses recoverable - inland- schedule 5.04 includes
 Rs.16.72 Crores recoverable from M/s HCL Infosystem Ltd. as
 compensation on account of excess amount spent by ITI Ltd. MANKAPUR.
 The above is on the basis of agreement entered into between ITI, HCL
 and Alcatel.
 
 9 Inventory of Pallakad unit includes an amount of Rs. 2.04 lakhs
 pending in Stock Correction Suspense Account as on 31.03.2011, the
 material is not physically held by the Unit but sent to different
 suppliers for rectification/replacement.
 
 10 Debtors and Security Deposit of NSU includes Rs.83.64 Lakhs and Rs.4
 Lakhs respectively due from Central Railway. Arbitration proceedings
 are under progress for the settlement.
 
 11 Cabinet Committee on Economic Affairs (CCEA) as a part of revival
 package approved financial assistance of Rs. 3000 crores to ITI, out of
 which Rs. 2820 crores was received by ITI in August 2009.  The balance
 Rs.180 crores was received in March 2011 and the same been taken to
 Capital Reserve.
 
 12 Company has not adopted the enhanced estimated useful life of the
 asset, suggested by registered valuer as this would have resulted in
 not complying with the requirement of charging minimum depreciation
 contemplated by schedule XIV of Companies Act, 1956. Consquently
 company charged off Rs.25.09 Crores (Previous year 25.34 crores) as
 depreciation on revalued asset for the year. However this has no effect
 on the losses of the year, as this amount is transferred from the
 revaluation reserve.
 
 13 Construction/ Turnkey Contracts:
 
 The company for the financial year 2010-11 has recognised revenue on
 Construction/ Turnkey contracts based on stage of completion as
 determined with respect to completion of physical proportion of the
 contract as certified and furnished by Company''s Engineers.
 Consequently,
 
 14 The company is engaged in the business of manufacture and sale of
 telecommunication equipments and there are no separate reportable
 segments as per Accounting Standard 17 issued by the Institute of
 Chartered Accountants of India.
 
 15 As per Accounting Standard 18 on Related Party Disclosures the
 following transactions are entered into with the Joint Ventures of the
 company viz. India Satcom Ltd and ITI Communications Pte. Ltd,
 Singapore.
 
 16 Since the company has no virtual certainty of sufficient future
 taxable income, no deferred tax asset is being recognised on unabsorbed
 depreciation and carried forward losses of the company under Accounting
 Standard (AS)-22 Accounting for Taxes on Income
 
 17 JOINT VENTURES:
 
 The financial reporting of interests in Joint Ventures as per AS-27,
 the Joint Ventures of the company come under the category of Jointly
 controlled entities.  The 2 Joint Ventures of the company are:
 
 a. India Satcom Limited
 
 No.2, Kadugodi Industrial Area, Whitefield, Bangalore - 560 067
 Company''s stake in equity participation-49% Place of incorporation of
 JV-India
 
 b. ITI Communications Pte Limited
 
 No.5, Shenton way, #27-01, UIC Building, Singapore-068808 Company''s
 stake in equity participation-49% Place of incorporation of
 JV-Singapore (The above figures does not include ITI-C, Singapore since
 it is in the process of liquidation.)
 
 (Bank account of ISL in SBI-IFB became NPA during September 2009 and
 referred to Stressed Asset Management Branch of SBI. Under the
 securitization and Reconstruction of Financial Assets and enforcement
 of Security Interest Act 2002 ( SARFAESI), SBI has taken possession of
 the property of ISL factory at Bangalore in May 2011. The accounts of
 ISL for the year 2010-11 are yet to be finalised).
 
 18 The Government has communicated vide its letter dated 28.01.2011
 that ITI may cancel the proposal of sale of its shares(1621800 Nos) in
 ISL to M/s Chris Tech Systems Private Limited. Consequently, the
 consideration amount of Rs.3 crores deposited in ESCROW account has
 since been released.
 
                                                      Rs.In Crores
 
                                     Current Year        Previous Year
                                          2010-11              2009-10
 
 19 Contingent Liability in respect of
 
 - Outstanding letters of credit & 
 guarantees                                265.12               484.05
 
 - Sales Tax demand /Service Tax            33.58                41.11
 
 - Non receipt of C/D forms                 72.40               130.30
 
 - Disputed Excise Duty Demand/CENVAT 
 Disallowance                               41.72                80.77
 
 - ESI demand                                0.94                 0.98
 
 - Demand of interest & penalty by KVAT      4.45                 4.32
 
 - Claims against the Company not 
 acknowledged as debts                      70.29                68.90
 
 20 Previous year''s figures have been regrouped and reclassified
 wherever necessary to conform to current year''s classification.
 
 21 Accretion/Decretion to stock-in-trade is arrived after considering
 due adjustment to difference in excise duty element in respect of
 opening and closing stock-in-trade.
 
 22 Figures in brackets indicated in the Accounts reflect negative
 balances.