NIIT

1.  CONTINGENT LIABILITIES
 
 i.  Guarantees issued to bankers outstanding at the end of accounting
 year Rs. 4,362,745/- (Previous year
 
 Rs. 10,881,495/-).  ii.  Corporate Guarantees Rs. 150,000,000/- given
 on behalf of NIITian Welfare Trust for loan availed by
 
 Trust (Previous year Rs. 150,000,000/-).
 
 iii. Corporate Guarantee Rs. 1,678,426,200/- [USD 33 million (net of
 payment of USD 10.5 million by NIIT (USA) Inc.)] given to ICICI Bank on
 behalf of NIIT (USA) Inc. [Previous year Rs. 1,602,444,000/- (USD 40
 million (net of payment of USD 3.5 million by NIIT (USA) Inc.))].
 
 iv. Stand by Letter of Credit of Rs. 152,584,200/- (USD 3 million)
 (Previous year Nil) from BNP Paribas in favor of Bank of West, USA on
 behalf of Element K Corporation, USA
 
 v. Security given to Indian Overseas Bank against working capital
 limits on behalf of Evolv Services Limited Rs. 1 Crore. (Previous year
 Nil) Amount outstanding as at the year end Rs. 8,496,824/- (Previous
 year Nil)
 
 vi.  Claims against the Company not acknowledged as debts Rs.
 14,900,000/-(Previous year Rs. 13,000,000/-).
 
 vii. Andhra Pradesh works contract tax demand Rs. 74,601,827/-
 (Previous year Rs. 81,080,962/-).  Management does not foresee any
 financial implication based on the advice of the legal consultant.
 
 viii. Service Tax demand amounting to Rs. 104.89 Lacs (Previous year
 Nil) and equal amount of penalty i.e.  Rs. 104.89 Lacs (Previous year
 Nil) raised by Commissioner of Service Tax, Delhi. Management does not
 foresee any financial implication based on the advice of the legal
 consultant.
 
 2.  Estimated amount of contracts remaining to be executed on capital
 account (net of advances) not provided for Rs. 208,865,610/- (Previous
 year Rs. 281,295,522/-).
 
 3.  Certain common resources are shared by the Company and NIIT
 Technologies Ltd (NTL). This resulted in the Company recovering Rs.
 8,835,659/- (Previous year Rs. 6,741,144/- ) from NTL and NTL
 recovering Rs.  10,860,791/- (Previous year Rs. 37,921,070/- ) from the
 Company which have been included/ netted off against relevant head in
 the Profit & Loss Account viz. Personnel, Development, Production and
 Execution, Administration & Others and Marketing expenses.
 
 4.  i).  Working Capital Limits are secured by hypothecation of stocks
 and book debts of the Company. The
 Company has utilised the cash credit (fund-based) limits to the extent
 of Rs. 136,384,748/- (Previous year Rs. 266,064,710/-) as at year end.
 
 ii). Rupee Term Loan from bank is secured by way of first charge
 created on all movable assets, both present and future, and specified
 immovable properties, subject to first charge created on stocks and
 book debts of the Company in respect of working capital limits above.
 
 iii). 1 2% Non Convertible Debentures issued to Life Insurance
 Corporation of India are secured by way of first charge on pari passu
 basis on the immovable and movable fixed assets of the Company.
 
 iv). 11.25% Non Convertible Debentures issued to Indian Overseas Bank
 are also required to be secured by way of first charge on pari passu
 basis on the immovable and movable fixed assets of the company. The
 Company is taking steps for creating charge in respect of such
 debentures as at the year end.
 
 v). Vehicle loans from banks are secured by way of hypothecation of the
 vehicles financed.
 
 5.  Interest received is gross of tax deducted at source of Rs.
 16,078,1 79/- (Previous year Rs. 8,399,756/ ).
 
 6.  Expenses during the year are net of recoveries towards common
 services from domestic subsidiaries amounting to Rs. 28,828,253/-
 (Previous year Rs. 29,268,767/-).
 
 7.  a.  The course execution charges include payments to licensees,
 business partners, channel partners and
 other agencies for execution of education and training business.
 
 b.  Course execution charges includes Rs. 45 Lacs pertaining to
 previous years.
 
 8. EMPLOYEES STOCK OPTION SCHEME
 
 During the year 2005-06, the Company had established NIIT Employee
 Stock Option Plan 2005 ESOP 2005 and the same was approved at the
 General Meeting of the Company held on May 18, 2005. The plan was set
 up so as to offer and grant, for the benefit of employees (excluding
 promoters) of the Company, who are eligible under Securities Exchange
 Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock
 Purchase Scheme) Guidelines, 1999, options of the Company in aggregate
 up to 1,925,000 options under ESOP 2005, in one or more tranches, and
 on such terms and conditions as may be fixed or determined by the
 Board, in accordance with the provisions of law or guidelines issued by
 the relevant authorities in this regard. As per the plan, each option
 is exercisable for one equity share of face value of Rs. 10/- each (Rs.
 2/- each post bonus and split) fully paid up on payment to the Company,
 for such shares, at a price to be determined in accordance with ESOP
 2005.
 
 During the previous year, the Company had issued bonus shares in the
 ratio of 1:2 i.e. one additional equity share for every two equity
 shares and also sub-divided 1 equity share of Rs. 10/- each into 5
 equity shares of Rs. II- each fully paid up as on the record date. ESOP
 information is therefore given for the number of shares after
 sub-division and bonus issue and previous year information has been
 restated accordingly.
 
 B) Defined Benefit Plans I.  Provident Fund
 
 In respect of Companys obligation towards guaranteed returns on
 Provident Fund Contributions made to the NIIT Limited Employees
 Provident Fund Trust, as the overall interest earnings and cumulative
 surplus are more than the statutory requirements, there is no liability
 of employer for the year ended March 31, 2009. Therefore, no additional
 provision for the year has been recommended by the actuary.
 
 i) Investment details of Plan Assets:
 
 The plan assets are maintained with Life Insurance Corporation of India
 Gratuity Scheme. The details of investment maintained by Life Insurance
 Corporation of India are not available with the Company and have not
 been disclosed.
 
 The expected return on plan assets is determined considering several
 applicable factors mainly the composition of plan assets held, assessed
 risk of asset management, historical result of the return on plan
 assets.
 
 9. DETAILS RELATING TO OPENING STOCK, PURCHASES, REVENUE AND CLOSING
 STOCK
 
 a) The Company is engaged inter-alia in the production and development
 of computer software. The production and sale of such software cannot
 be expressed in generic unit. Hence, it is not possible to give
 quantitative details as required under paragraph 3 of Part II of
 Schedule VI of the Companies Act, 1 956.
 
 10. RELATED PARTY TRANSACTIONS AS PER ACCOUNTING STANDARD 18 A.
 Related party relationship where control exists:
 
 Subsidiaries
 
 1.  NIIT Online Learning Limited
 
 2.  Hole-in-the-Wall Education Limited
 
 3.  Scantech Evaluation Services Limited
 
 4.  NIIT Multimedia Limited
 
 5.  NIIT Institute of Finance Banking and Insurance Training Limited
 
 6.  NIIT Institute of Process Excellence Limited (w.e.f. April 02,
 2008)
 
 7.  Evolv Services Limited
 
 8.  NIIT Limited, UK
 
 9.  NIIT Antilles NV, Netherlands Antilles
 
 10. NIIT Middle East LLC, Bahrain {Under Liquidation) 
 
 11. NIIT Malaysia Sdn. Bhd, Malaysia
 
 12. NIIT GC Limited (formerly NIIT TVE Limited, Mauritius)
 
 13. NIIT China (Shanghai) Limited, Shanghai
 
 14. NIIT Wuxi Service Outsourcing Training School, China
 
 15. Chongqing NIIT Education Consulting Limited, China (w.e.f. May 13,
 2008)
 
 16. PCEC NIIT Institute of Information Technology, Shanghai
 
 17. NIIT (USA) Inc., USA
 
 18. NIIT Ventures Inc., USA
 
 19. Element K Corporation, USA
 
 20. Element K India Private Limited, India
 
 21. Element K (UK) Limited, United Kingdom
 
 22. Element K, Canada
 
 23. PT NIIT Indonesia, Indonesia (Under Liquidation)
 
 24.lmperia China (Shanghai) Limited (w.e.f. February 16, 2009)
 
 B.  Other related parties with whom the Company has transacted:
 
 a) Associates (Parties in which Company has substantial interest)
 
 1.  NIIT Technologies Limited
 
 2.  NIIT GIS Limited
 
 3.  NIIT Smart Serve Limited
 
 b) Key Managerial Personnel
 
 1.  Rajendra S Pawar (Chairman and Managing Director)
 
 2.  Vijay K Thadani (Chief Executive Officer and Whole-time Director)
 
 3.  P Rajendran (Chief Operating Officer and Whole-time Director)
 
 c) Relatives of Key Managerial Personnel
 
 1.  Renuka Thadani (Wife of Vijay K Thadani)
 
 2.  Veena Oberoi (Sister of Vijay K Thadani)
 
 d) Parties in which the Key Managerial Personnel of the Company are
 interested
 
 1.  NIIT Institute of Information Technology
 
 2.  NIIT Education Society
 
 3.  Pace Industries Private Limited
 
 4.  NIIT Network Services Limited
 
 Notes:
 
 1.  Previous years figures are given in parenthesis.
 
 2.  Includes purchase of goods from:
 
 Element K Corporation, USA Rs. 8.20 Lacs (Previous year Rs. 1 6.23 Lacs
 )
 
 - NIIT (USA) Inc. Rs. 89.71 Lacs (Previous year Nil)
 
 - NIIT Antilles NV, Netherlands Antilles Nil (Previous year Rs. 1.59
 Lacs )
 
 3.  Includes sale of goods to:
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs.
 1.20 Lacs (Previous year Nil ) NIIT Institute of Information Technology
 Rs. 26.95 Lacs (Previous year Rs. 1 7.58 Lacs )
 
 4.  Includes purchase of Fixed Assets from:
 
 - NIIT (USA) Inc. Rs. 94.28 Lacs (Previous year Rs. 1 4.95 Lacs ) Evolv
 Services Limited Rs. 7.25 Lacs (Previous year Rs. 7.39 Lacs )
 
 - NIIT Technologies Limited Rs. 89.92 Lacs (Previous year Rs. 3.02 Lacs
 ) NIIT Institute of Information Technology Nil (Previous year Rs.
 279.04 Lacs )
 
 5.  Includes Sale of Fixed Assets to:
 
 - NIIT (USA) Inc. Nil (Previous year Rs. 0.34 Lacs )
 
 NIIT Technologies Limited Rs. 3.73 Lacs (Previous year Rs. 1.50 Lacs )
 
 NIIT Institute of Information Technology Rs. 2,140.04 Lacs (Previous
 year Nil)
 
 6.  Includes Rendering of services to:
 
 - NIIT (USA) Inc. Rs. 3,875.64 Lacs (Previous year Rs. 4,21 5.46 Lacs )
 
 - NIIT Antilles NV, Netherlands Antilles Rs. 492.66 Lacs (Previous year
 Rs. 370.08 Lacs )
 
 - NIIT Limited, UK Rs. 519.35 Lacs (Previous year Rs. 598.06 Lacs )
 
 NIIT Technologies Limited Rs. 53.11 Lacs (Previous year Rs. 159.59 Lacs
 )
 
 Evolv Services Limited Rs. 38.09 Lacs (Previous year Nil)
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs.
 97.19 Lacs (Previous year Rs.
 
 113.06 Lacs)
 
 - NIIT Malaysia, Sdn. Bhd Rs. 48.14 Lacs (Previous year Rs. 42.31 Lacs
 )
 
 7.  Includes Receiving of services from:
 
 - NIIT (USA) Inc. Rs. 1 76.70 Lacs (Previous year Rs. 1 7.57 Lacs )
 
 - NIIT GIS Limited Rs. 1 8.23 Lacs (Previous year Rs. 12.24 Lacs )
 
 NIIT Smart Serve Limited Rs. 74.46 Lacs (Previous year Rs. 63.47 Lacs )
 NIIT Institute of Information Technology Nil (Previous year Rs. 1.96
 Lacs ) Evolv Services Limited Rs. 66.1 7 Lacs (Previous year Nil)
 
 8.  Includes recovery of expenses from:
 
 Hole-in-the-Wall Education Limited Rs. 33.27 Lacs (Previous year Rs.
 35.5 Lacs )
 
 - NIIT (USA) Inc. Rs. 41.1 7 Lacs (Previous year Rs. 26.94 Lacs )
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs.
 184.26 Lacs (Previous year Rs. 1 50.09 Lacs )
 
 NIIT Technologies Limited Rs. 88.36 Lacs (Previous year Rs. 67.41 Lacs
 )
 
 - NIIT GIS Limited Rs. 28.01 Lacs (Previous year Rs. 28.09 Lacs )
 
 NIIT Institute of Information Technology Rs. 86.1 8 Lacs (Previous year
 Rs. 75.47 Lacs ) NIIT Institute of Process Excellence Limited Rs. 70.76
 Lacs (Previous year Nil) Element K Corporation, USA Rs. 43.59 Lacs
 (Previous year Nil)
 
 - NIIT Limited, UK Rs. 4.75 Lacs (Previous year Rs. 0.71 Lacs )
 
 9.  Includes recovery of expenses by:
 
 - NIIT Technologies Limited Rs. 1 08.61 Lacs (Previous year Rs. 379.21
 Lacs ) NIIT Smart Serve Limited Nil (Previous year Rs. 13.24 Lacs )
 
 NIIT Institute of Information Technology Rs. 8.02 Lacs (Previous year
 Rs. 20.1 3 Lacs )
 
 - NIIT (USA) Inc. Rs. 39.70 Lacs (Previous year Rs. 3.95 Lacs )
 
 - NIIT Limited, UK Rs. 5.35 Lacs (Previous year Nil)
 
 10.  Represents investments made in:
 
 NIIT Multimedia Limited Rs. 180 Lacs (Previous year Rs. 550 Lacs ) NIIT
 Institute of Process Excellence Limited Rs. 450 Lacs (Previous year
 Nil) Evolv Services Limited Nil (Previous year Rs. 280 Lacs ) 1 1.
 Loan given relates to:
 
 Hole-in-the-Wall Education Limited Rs. 292 Lacs (Previous year Rs. 238
 Lacs )
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs. 1
 35 Lacs (Previous year Rs.
 
 1 85 Lacs )
 
 NIIT Multimedia Limited Rs. 50 Lacs (Previous year Rs. 85 Lacs )
 
 - NIIT (USA) Inc. Rs. 3,605 Lacs (Previous year Nil) NIIT Education
 Society Nil (Previous year Rs. 535 Lacs )
 
 NIIT Institute of Information Technology Rs. 1,795 Lacs (Previous year
 Rs. 300 Lacs ) Evolv Services Limited Rs. 137 Lacs (Previous year Nil)
 1 2.  Loans Given Received Back relates to:
 
 - NIIT (USA) Inc. Nil (Previous year Rs. 933.60 Lacs )
 
 Hole-in-the-Wall Education Limited Rs. 133 Lacs (Previous year Rs. 167
 Lacs ) NIIT Multimedia Limited Rs. 85 Lacs (Previous year Nil) NIIT
 Education Society Rs. 100 Lacs (Previous year Rs. 462 Lacs ) NIIT
 Institute of Information Technology Rs. 470 Lacs (Previous year Nil )
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs. 1
 85 Lacs (Previous year Nil ) Evolv Services Limited Rs. 35 Lacs
 (Previous year Nil ) 1 3.  Loans taken from:
 
 Scantech Evaluation Services Limited Rs. 965 Lacs (Previous year Rs.
 1,265 Lacs )
 
 14.  Repayment of loan taken:
 
 Scantech Evaluation Services Limited Rs. 2,203 Lacs (Previous year Rs.
 480 Lacs )
 
 15.  Interest Income from:
 
 - NIIT (USA) Inc. Rs. 227.70 Lacs (Previous year Rs. 67.42 Lacs )
 Hole-in-the-Wall Education Limited Rs. 29.36 Lacs (Previous year Rs.
 15.84 Lacs ) NIIT Multimedia Limited Rs. 5.91 Lacs (Previous year Rs.
 44.90 Lacs )
 
 NIIT Education Society Rs. 4.79 Lacs (Previous year Rs. 239.06 Lacs )
 
 Evolv Services Limited Rs. 11.07 Lacs (Previous year Nil )
 
 NIIT Institute of Information Technology Rs. 461.24 Lacs (Previous year
 Nil )
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs.
 12.04 Lacs (Previous year Rs.
 
 1 1.40 Lacs )
 
 16.  Interest Expenditure includes:
 
 Scantech Evaluation Services Limited Rs. 126.18 Lacs (Previous year Rs.
 159.35 Lacs )
 
 17.  Conversion of loan into equity includes:
 
 NIIT Multimedia Limited Nil (Previous year Rs. 550 Lacs ) 1 8.
 Assignment of loan includes:
 
 Assignment of loan from NIIT Education Society to NIIT Institute of
 Information Technologies Nil
 
 (Previous year Rs. 2,738 Lacs ) 1 9.  Includes transactions for the
 year mainly with:
 
 Rajendra S Pawar Rs. 109.84 Lacs (Previous year Rs. 124.14 Lacs )
 
 Vijay K Thadani Rs. Ill .63 Lacs (Previous year Rs. 1 74.71 Lacs )
 
 - P Rajendran Rs. 81.70 Lacs (Previous year Rs. 92.1 2 Lacs )
 
 20.  Other Expenses includes:
 
 Renuka Thadani Rs. 9 Lacs (Previous year Rs. 8.25 Lacs )
 
 Veena Oberoi Rs. 4.96 Lacs (Previous year Rs. 2.76 Lacs )
 
 Pace Industries Private Limited Rs. 4.50 Lacs (Previous year Rs. 1.80
 Lacs )
 
 21.  Other Income includes:
 
 - NIIT (USA) Inc. Rs. 88.71 Lacs (Previous year Rs. 11 0.62 Lacs )
 
 - NIIT Antilles NV, Netherlands Antilles Rs. 728.84 Lacs (Previous year
 Rs. 772.99 Lacs )
 
 NIIT Institute of Finance Banking and Insurance Training Limited Rs.
 114.89 Lacs (Previous year
 Rs. 61.86 Lacs)
 
 NIIT Institute of Information Technology Rs. 11.04 Lacs (Previous year
 Nil)
 
 NIIT Institute of Process Excellence Limited Rs. 40.71 Lacs (Previous
 year Nil)
 
 - NIIT Limited, UK Rs. 6.81 Lacs (Previous year Rs. 11.01 Lacs )
 Hole-in-the-Wall Education Limited Rs. 9.59 Lacs (Previous year Rs.
 10.07 Lacs )
 
 22.  Dividend Income includes:
 
 Scantech Evaluation Services Limited Rs. 782.89 Lacs (Previous year Rs.
 1,882.90 Lacs )
 
 23.  Advance/ Security Deposit Recovered
 
 NIIT Institute of Information Technology Rs. 240.59 Lacs (Previous year
 Nil )
 
 20. During the year, the Company has disposed off the balance part of
 its holding in Mindshaper Technologies Pvt. Ltd. of 32,111 fully paid
 up Equity Shares of Rs. 10/- each for a consideration of Rs. 65 Lacs.
 The investment was fully provided, for the permanent dimiNIITion in its
 value in the previous years and the provision has been written back
 proportionately.
 
 21. The Company has loans recoverable amounting to Rs. 35 Lacs as on
 March 31, 2009 from NIIT Education Society, a society registered under
 Societies Registration Act, 1 860, which has an objective to set up
 university and sponsoring other societies for setting up of
 universities. The Society is at present financed by the loan given by
 the Company and other sources [Donations of Rs. 804 Lacs (Previous year
 Rs. 398 Lacs)] which have primarily been utilised by the Society for
 giving donations to another society, namely, NIIT Institute of
 Information Technology, for the purpose of setting up of a university.
 
 During the previous year, loan advanced by the Company to NIIT
 Education Society amounting to Rs. 2,738 Lacs had been assigned to NIIT
 Institute of Information Technology from NIIT Education Society. In the
 current financial year the company has granted a loan of Rs 1,795 Lacs
 (Previous year Rs 300 Lacs) to NIIT Institute of Information
 Technology. After considering a loan repayment of Rs 470 Lacs (Previous
 year Nil), the loan balance as on March 31, 2009 stands at Rs. 4,363
 Lacs including the loan assigned during previous year (Previous year
 Rs. 3,038 Lacs). The rate of interest on such loans has been revised to
 12% p.a. with effect from April 01, 2008 and the repayment of the
 principal amounts of the loan by NIIT Institute of Information
 Technology (over and above the loan amount subordinated to bank loan to
 the extent of Rs. 2,743 Lacs) is scheduled to start from September,
 2014 in 20 quarterly installments.
 
 23. During the year, the Company has further invested a sum of Rs. 180
 Lacs in the equity share of Rs. 10/- each in its wholly owned
 subsidiary NIIT Multimedia Ltd.
 
 24. The Company has invested a sum of Rs. 450 Lacs in the equity shares
 of Rs. 10/- each in the newly established subsidiary company, NIIT
 Institute of Process Excellence Limited. This Company was incorporated
 on April 02, 2008 vide board resolution dated March 1 7, 2008.
 
 25. The Companys wholly owned domestic subsidiary Scantech Evaluation
 Services Limited has declared dividend amounting to Rs. 782.89 Lacs
 (Previous year Rs. 1,882.90 Lacs) in respect of which dividend
 distribution tax would be paid by the subsidiary. In terms of
 provisions of sub-section 1A of section 1150 of the Income Tax Act,
 1961, dividend distribution tax payable by the Company, is net of the
 dividend distribution tax paid by the subsidiary company amounting to
 Rs. 133.05 Lacs (Previous year Rs. 320 Lacs).
 
 26.  Certain overdue debtors balances aggregating to Rs. 1,623.90 Lacs
 relating to government customers are not provided for based on
 confirmations/ acknowledgment for services rendered. The management is
 taking appropriate action for recovery of the amounts and is confident
 of recovery of the same.
 
 27. During the year, the Company has reviewed the estimated useful life
 of certain class of fixed assets which has resulted in increase of
 depreciation for the current financial year by Rs 129.20 Lacs with a
 corresponding impact on the profit before taxes.
 
 28. During the year, the Company has sold 75 Acres of land and the
 project cost incurred on this land to NIIT Institute of Information
 Technology for a sum of Rs. 1,056 Lacs and Rs. 1,082 Lacs respectively.
 The profit on sale of land and project cost, amounting to Rs. 957 Lacs
 has been shown as other income for the year.
 
 29. Previous year figures have been regrouped/ recast to conform to
 current year classifications.