Dear Members,
 
 The Directors take pleasure to present the 24th Annual Report on the
 business and operations of the Company together with the Audited
 Financial Accounts for the year ended 31st March, 2011.
 
 The financial highlights of the Company :- 
                                                  (Rupees in Lakhs)
 
                                      SQL Star        SQL Star, India
                                  Group Consolidated  (Stand alone)
 Particulars                        Financial Year    Financial Year
                                 2010-11   2009-10   2010-11    2009-10
 
 INCOME:
 
 - Sales/Income from Operations  3,938.68  5,381.01  1,778.16  2,545.59
 
 Total                           3,938.68  5,381.01  1,778.16  2,545.59
 
 EXPENDITURE:
 
 -Staff Cost                     2,927.38  3,462.61  1,035.16  1,077.96
 
 - Other Expenditure             1,281.21  1,188.75    784.49    861.69
 
 - Direct & Outsourcing            282.81    540.51    204.57    348.22 
 
 - Provisions                      160.54  1,441.71    160.54  1,441.71
 
 - Depreciation                    215.75    830.68    190.75    820.59
 
 Total                           4,867.69  7,464.26  2,375.51  4,550.17 
 
 Profit / (Loss) from
 Operations before Other Income,
 interest & exceptional items     <929.01)(2,083.25) (597.35) (2,004.58)
 
 - Other Income                     86.91    132.10    71.16      90.47 
 
 Profit/(Loss) before interest &
 exceptional items               (842.10) (1,951.15) (526.19) (1,914.11)
 
 - Interest                         53.91    108.94    47.13     103.23 
 Profit/Loss) After Interest but
 before exceptional items         (896.01)(2,060.09) (573.32) (2,017.34)
 
 - Exceptional Items                -         49.35      -        49.35 
 
 Profit/Loss) from Ordinary
 Activities before tax            (896.01)(2,109.44) (573.32) (2,066.69)
 
 Tax Expenses                      (39.51)  (234.62)  (45.05)   <238.47)
 
 Profit/Loss) from Ordinary
 Activities after tax             (856.50)(1,874.82) (528.27) (1,828.22)
 Extraordinary Items 
 (net of tax expenses)               -          -        -         -
 
 Net Profit/Loss) for the period (856.50) (1,874.82) (528.27) (1,828.22)
 
 Business Performance
 
 On a Consolidated basis, the Company reported total income of Rs.
 3,938.68 lacs in the FY 2010-11, as compared to Rs. 5,381.01 lacs
 reported in the previous financial year, registering a decline of 27%.
 The loss aftertax was Rs. 856.50 lacs in the FY 2010-11, as against Rs.
 1,874.82 lacs reported in the previous year.
 
 On a Standalone basis, the Company reported total income of Rs 1,778.16
 lacs in the FY 2010-11, as compared to Rs. 2545.59 lacs reported in the
 previous financial year, registering a decline of 30%. The loss after
 tax was Rs. 528.27 lacs in the FY 2010-11, as against Rs. 1828.22 lacs
 reported in the previous year.
 
 2.1.  Performance of SQL Star, India - Standalone Company
 
 The main reason for the fall in the revenue of the stand-alone company
 was due to decline in revenues from the e- Governance vertical. As
 informed in our previous Annual Report, during the last fiscal, the
 Mandi Board had resorted to unilateral and un-lawful termination of the
 Service Contract for executing the Mandi Project and further, withheld
 dues to the Company from April'' 08 onwards aggregating to Rs. 28.77 Cr
 (out of which Rs. 20.22 Cr pertains to billing raised on behalf of
 outsourcing partner). The Mandi Project was one of the major
 contributors to the revenues of the Company and the unilateral and
 un-lawful termination has severely impacted the Company financially and
 otherwise.  The matter was referred for Arbitration proceedings. When
 the arbitration proceedings were in progress, the Mandi Board withdrew
 the arbitrator and the new arbitrator is yet to be appointed by the
 Mandi Board. In the meanwhile, the company has filed a petition before
 the Honourable High Court of Madhya Pradesh, Jabalpur Bench seeking to
 appoint an arbitrator to complete the proceedings.
 
 Further, the other e-Govemance project viz., Sampark Project in the
 Union Territory of Chandigarh came to a logical conclusion as of Dec
 31, 2010. When the Department of Information Technology, Chandigarh
 initiated the re- tendering process, the Company has submitted its bids
 and stood as sole bidder in the technical review, however, owing to the
 CVC guidelines, the Department of Information Technology (DIT),
 Chandigarh has entrusted the responsibility of running the operations
 to another Department Agency viz., Society of Promotion of Information
 Technology in Chandigarh (SPIC) which is part of DIT, Chandigarh,
 w.e.f Jan 01, 2011. Asa result of this change, the Company had lost the
 project revenues from 4,h quarter of financial year 2010- 11 onwards.
 
 2.2.  Performance of Wholly Owned Subsidiaries
 
 During the year under review, the Singapore Company reported an
 increase of around 39% in its revenues, whereas the revenues of the USA
 subsidiary was down by around 65%, mainly due to macroeconomic
 conditions prevailing in the USA and also on account of no revenues
 from the Embedded Wireless and Software business unit, as it has been
 shelved by the Company. Due to certain business challenges, there were
 no major revenues from the Australian Company.
 
 (a) SQL Star International Inc., USA
 
 During the year under review, SQL Star International Inc., USA, has
 generated Rs. 607.55 Lakhs in revenue and reported Loss before
 Interest, Depreciation and Tax of Rs (127.36) Lakhs, with loss after
 Tax of Rs. 126.33 Lakhs.
 
 (b) International SQL Star Pte. Ltd., Singapore
 
 During the year under review, International SQL Star Pte Ltd.,
 Singapore, has generated Rs. 1518.63 Lakhs in revenue and reported
 Profit before Interest, Depreciation and Tax of Rs. 29.85 Lakhs, with
 Profit after Tax of Rs. 6.49 Lakhs.
 
 (c) SQL Star International Pty Ltd., Australia
 
 During the year under review, SQL Star International Pty Ltd.,
 Australia, has generated Rs. 41.27 Lakhs in revenue and reported Loss
 before Interest, Depreciation and Tax of Rs. (3.55) Lakhs, with loss
 after Tax of Rs.  5.49 Lakhs.
 
 3.  DIVIDEND
 
 Due to the loss incurred during the year, the Board of Directors of
 your Company does not recommend any dividend for the financial year
 2010-11.
 
 4.  AUDITOR''S
 
 The Statutory Auditors of the Company, M/s. Maharaj N R Suresh & Co,
 Chartered Accountants, Chennai retire at the conclusion of the ensuing
 Annual General Meeting and being eligible, offered themselves for
 re-appointment.
 
 The Company has received letter from them to the effect that their
 appointment if made would be within the prescribed limits under Section
 224(1-B) of the Companies Act, 1956.
 
 6.  DIRECTORS
 
 As per Article 51 of the Articles of Association, Mr.  Jai Narain
 Khandelwal retires by rotation at the ensuing Annual General Meeting
 and being eligible offers himself for re-appointment.
 
 Sri. Mahesh Solanki was appointed as an additional director of the
 Company at the Board Meeting held on 27/01/2011. The Company has
 received notices under section 257 of the Companies Act, 1956 together
 with a deposit of Rs. 500/- signifying their intention to propose Sri.
 Mahesh Solanki as director, subject to retirement by rotation. He holds
 office up to the date of ensuing Annual General Meeting.
 
 Sri. Mohinesh Jagwani was appointed as an additional director of the
 Company at the Board Meeting held on 27/01/2011. The Company has
 received notices under section 257 of the Companies Act, 1956 together
 with a deposit of Rs. 500/- signifying their intention to propose Sri.
 Mohinesh Jagwani as director, subject to retirement by rotation. He
 holds office up to the date of ensuing Annual General Meeting.
 
 7.  PUBLIC DEPOSITS
 
 In terms of the Provision of section 58A of the Companies Act, 1956
 read with the Companies (Acceptance of Deposits Rules) 1975, Your
 Company has accepted loans which are in the nature of deposits.
 
 8.  CORPORATE GOVERNANCE
 
 Pursuant to the provisions of Clause 49 of the Listing Agreement and
 Section 292A of the Companies Act, 1956, a Report on the Corporate
 Governance, which, inter alia, includes the composition and
 constitution of Audit Committee, is featuring as a part of Annual
 Report. Certificate of the Statutory Auditors regarding compliance with
 the conditions of Corporate Governance as stipulated in Clause 49 of
 the Listing Agreement is also given in this Annual Report. Your Company
 will continue to adhere in letter and spirit to the good corporate
 governance policies.
 
 9.  MANAGEMENT DISCUSSION AND ANALYSIS
 
 Management Discussion and Analysis Report as required under Clause 49
 (IV) (F) is disclosed separately in this Annual Report.
 
 10.  INTERNAL CONTROL
 
 Your Company has established reasonably sound system of Internal
 controls in the operational areas.  Internal controls evolved are
 commensurate with the size of the operations and organizational
 requirements and are adequate to protect the enterprise resources. The
 Audit Committee reviews the adequacy of internal control system from
 time to time.
 
 11.  HUMAN RESOURCES
 
 Your Company administers a comprehensive human resources management
 system which includes attracting, developing and retaining a highly
 qualified and continuously learning workforce. Your Company is
 continuously striving towards the implementation of certain HR best
 practices, with a greater focus on fulfilling and supporting our
 business needs and simultaneously catering to the enhancement of
 people, process and procedures in the organization.
 
 12.  QUALITY
 
 Continuous Quality improvement and adherence to quality standards and
 processes are important to remain competitive in the global market.
 During the year, your Company has focused on improving quality in every
 process, including project designs, product development and delivery,
 Testing and Implementation and maintenance.. As a part of continuous
 improvement program, during the year, your Company obtained ISO
 9001:2008 recertification.
 
 13.  MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION
 
 Pursuant to provisions of Section 217 (1) (d) of the Companies Act,
 1956, there has been no material change and commitment affecting the
 financial position of the Company that has occurred between the end of
 the financial year of the company, related to the balance sheet and the
 date of the report.
 
 14.  CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION etc.
 
 Information in accordance with the provisions of section 217 (1)(e) of
 the Companies Act, 1956 read with the Companies (Disclosure of
 Particulars in the Report of Board of Directors) Rules, 1988 is given
 in Annexure-A forming part of this report.
 
 15.  FINANCIAL INFORMAITON OF SUBSIDIARY COMPANIES
 
 In terms of the specific approval granted by the Central Government
 under Section 212(8) of the Companies Act, 1956, and in terms of the
 general permission granted by the Central Government to all companies
 vide General Circular No. 3/2011 dated February 21, 2011, the
 Audited/Un-Audited Financial Statements along with the reports of the
 Board of Directors and the Auditors pertaining to the above
 subsidiaries have not been attached to this Report. The Financial
 Statements of the said subsidiaries will be kept for inspection by any
 investor at the registered office of your Company. Investors who want
 to have a copy of the above may write to the Compliance Officer at the
 registered office.
 
 17.  DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement of provisions of Section 217 (2AA) of the
 Companies Act, 1956 with respect to Directors'' Responsibility
 Statement, it is hereby confirmed that:-
 
 (i) In the preparation of the annual accounts for the year ended March
 31st, 2011, the applicable accounting standards read with requirements
 set out under Schedule VI of the Companies Act, 1956, have been
 followed and there are no material departures from the same;
 
 (ii) The Directors have selected such accounting policies and applied
 them consistently and made judgments and estimates that are reasonable
 and prudent so as to give a true and fair view of the state of affairs
 of the Company as at March 31st, 2011 and the Loss of the Company for
 the year ended as on date.
 
 (iii) The Directors 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; and
 
 (iv) The Directors have prepared the annual accounts of the Company on
 a going concern basis.
 
 18.  RELATED PARTY TRANSACTIONS
 
 As a matter of policy, your Company carries out transactions with
 related parties on an arm''s length basis. Statement of these
 transactions is given in the Notes to Accounts in compliance of
 Accounting Standard AS - 18.
 
 19.  ACKNOWLEDGEMENTS
 
 Your Directors wish to place on record their appreciation for the
 valuable support and cooperation extended by Yes Bank and other State
 and Central Government Agencies.
 
 Your Directors also wish to place on record their sincere appreciation
 of the contribution made by the employees of the Company and are
 thankful to the Shareholders for their continued patronage and support.
 
                                       For and on behalf of the Board
                                       SQL Star International Limited
 
 Place: Mumbai                                            Sunil Gupta
 
 Date: 2nd Septemeber, 2011         Co-Chairman and Managing Director