OPTEL TELECOMMUNICATIONS LIMITED (OPTEL) was incorporated on 23rd
 December 1988 under the Companies Act, 1956 in the State of Madhya
 Pradesh.  The Company was promoted by M. P. State Electronics
 Development Corparation Limited, (MPSEDC) Bhopal (A Govt. of Madhya
 Pradesh Undertaking) with the authorised and paid up capital of
 Rs.25.00 crores and Rs. 15.00 crares respectively.  MPSEDC is a nodal
 agency for M. P. Government, charged with responsibility of promotion
 and development of electronic industries in the Stote of M. P.
 
 During middle of eighties, Department of Telecommunication realised
 the need for inducting fibre optics in the telecom network in the
 country to support the growing demands of high density telecom
 traffic.  Department of Telecommunication and Department of
 Electronics asked MPSEDC to take up project for manufacture of
 Optical Fibre, Optical Fibre Cable and Opto Electronic System
 Equipments and accordingly industrial licence was issued. The project
 was taken up by MPSEDC as a separate division, called Opto Electronics
 Communication System (OECS) Project in the year 1987.  At the initial
 stages of this project, it was decided by Government vide order
 No.F/20/4/86/11/A  dated  22.11.1988 and order No. 1519/1
 54/SCI/11/B/90, dated 16.02.1990, that MPSEDC would incorporate a
 separate subsidiary Company under the name OPTEL TELECOMMUNICATIONS
 LIMITED (OPTEL) which would, in due course of time, take over the
 assets and liabilities of OECS project from MPSEDC, once the
 commercial production stabilised and the Company (OPTEL) would take
 over the running unit.  The OECS project division of MPSEDC had
 commenced its commercial production for Optical Fibre Cable,
 Opto-electronic communication system equipment and for Optical fibre
 with effect from 1st July, 1989, 15th November 1989 and 1st July,
 1990 respectively.  Separate accounts were prepared for this division
 from F. Y. 1989-90, and the same were audited by CAG appointed
 auditors.  The running business of the OECS division with whole of
 assets and liabilities were transferred to the Company (OPTEL) w.e.f.
 1st April, 1992 vide transfer deed dated 2nd December, 1992, for a
 total consideration of Rs. 15.00 crores and shares were issued to
 MPSEDC for the same.
 
 The total of capital account as on that day was converted into equity
 capital and the profit earned on the project was retained by the
 MPSEDC.  The sum of Rs. 15.00 crores was equivalent to the equity
 fund (Rs. 14.85 crores as equity fund and Rs. 0.15 crores as
 state/central subsidy) received by MPSEDC from the government for
 this project.