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2008-09-Annual-Report

2008-09-Annual-Report

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Sections

  • COMPLIANCE OFFICER
  • INVESTOR SERVICES
  • STATUTORY AUDITORS
  • REGISTRARS & SHARETRANSFER AGENTS
  • REGISTERED OFFICE
  • NOTICE
  • ANNEXURE I
  • ANNEXURE II
  • AUDITORS’CERTIFICATE
  • CORPORATE GOVERNANCE REPORT FORTHEYEAR 2008-09
  • MANAGEMENT DISCUSSION & ANALYSIS OF FINANCIAL
  • CONDITION AND RESULTS OF OPERATIONS
  • AUDITORS’REPORT
  • ANNEXURETOTHE AUDITORS’REPORT
  • PROFIT AND LOSS ACCOUNT FORTHEYEAR ENDED MARCH 31, 2009
  • SCHEDULES FORMING PART OFTHE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT
  • SCHEDULE 17
  • CASH FLOW STATEMENT FORTHEYEAR ENDED MARCH 31, 2009
  • BALANCE SHEET ABSTRACT AND GENERAL BUSINESS PROFILE
  • Auditors' Report
  • CONSOLIDATED BALANCE SHEET AS AT MARCH 31, 2009
  • CONSOLIDATED PROFIT AND LOSS ACCOUNT FORTHEYEAR ENDED MARCH 31, 2009
  • CONSOLIDATED CASH FLOW STATEMENT FORTHEYEAR ENDED MARCH 31, 2009
  • BALANCE SHEET AS AT MARCH 31, 2009
  • SCHEDULES FORMING PART OF
  • PROFIT AND LOSS ACCOUNT FORTHEYEAR ENDED
  • CASH FLOW STATEMENT FORTHE PERIOD ENDED MARCH 31, 2009

BOARD OF DIRECTORS
Mr. Kishor A. Chaukar (Chairman) Mr. Amal Ganguli Mr. Nadir Godrej Prof. Ashok Jhunjhunwala Mr. D. T. Joseph Mr. N. S. Ramachandran Mr. S. Ramadorai Mr. Anil Sardana Mr. Koichi Takahara Dr. Mukund Rajan (Managing Director)

COMPLIANCE OFFICER
Mr. Madhav Joshi Chief Legal Officer & Company Secretary

INVESTOR SERVICES
Mr. Hiten Koradia Deputy Manager - Investor Relations Tel: 91 22 6661 5152 e-mail: investor.relations@tatatel.co.in

STATUTORY AUDITORS
M/s. Deloitte Haskins & Sells Chartered Accountants 12, Dr. Annie Besant Road, Opp. Shiv Sagar Estate, Worli, Mumbai - 400 018.

REGISTRARS & SHARE TRANSFER AGENTS
TSR Darashaw Limited 6-10, Haji Moosa Patrawala Industrial Estate, 20, Dr. E. Moses Road, Near Famous Studio, Mahalaxmi, Mumbai - 400 011. Tel: 91 22 6656 8484 Fax: 91 22 6656 8494 / 6656 8496 Email: csg-unit@tsrdarashaw.com Website: www.tsrdarashaw.com

REGISTERED OFFICE
Voltas Premises, T B Kadam Marg, Chinchpokli, Mumbai - 400 033. Tel: 91 22 6661 5445 Fax: 91 22 6660 5516 / 5517 e-mail: investor.relations@tatatel.co.in Website: www.tataindicom.com

1

1956 related to Subsidiary Companies Directors’ Report and Financial Statements of the Subsidiary Company 21st Century Infra Tele Limited (formerly 21st Century Infra Tele Private Limited) Financial Year 2007-08 Financial Year 2008-09 Page No. 3 6 13 23 29 32 33 34 55 56 57 58 59 60 77 78 79 83 2 .14 Annual Report 2008-09 th CONTENTS Notice Directors' Report Corporate Governance Report Management Discussion and Analysis of Financial Condition and Results of Operations Auditors' Report Balance Sheet Profit & Loss Account Schedules forming part of the Balance Sheet and Profit & Loss Account Cash Flow Statement Balance Sheet Abstract and General Business Profile Consolidated Financial Statements Auditors' Report Consolidated Balance Sheet Consolidated Profit & Loss Account Schedules forming part of the Consolidated Balance Sheet and Profit & Loss Account Consolidated Cash Flow Statement Statement under Section 212 of the Companies Act.

2009 at 1500 hours at Kamalnarayan Bajaj Hall & Art Gallery. who was appointed as an Additional Director of the Company and who holds office upto the date of this Annual General Meeting of the Company in terms of Section 260 of the Companies Act. with or without modifications. liable to retire by rotation. who was appointed as an Additional Director of the Company and who holds office upto the date of this Annual General Meeting of the Company in terms of Section 260 of the Companies Act. liable to retire by rotation. retiring auditors of the Company. S. the following as an Ordinary Resolution: “RESOLVED THAT Mr. the following as an Ordinary Resolution: “RESOLVED THAT M/s Deloitte Haskins & Sells. to pass. August 13. who was appointed as an Additional Director of the Company and who holds office upto the date of this Annual General Meeting of the Company in terms of Section 260 of the Companies Act. the following as an Ordinary Resolution: “RESOLVED THAT Mr.” 8. the following as an Ordinary Resolution: “RESOLVED THAT Mr. To consider and. July 2. with or without modifications. Koichi Takahara. Chinchpokli.” 6. Ashok Jhunjhunwala. to pass. be and is hereby appointed a Director of the Company. Mumbai . to pass. Joseph. if thought fit. T B Kadam Marg. the following as an Ordinary Resolution: “RESOLVED THAT Mr. be and is hereby appointed a Director of the Company. be and is hereby re-elected a Director of the Company. the following as an Ordinary Resolution: “RESOLVED THAT Prof. Jamnalal Bajaj Marg. whose office shall be liable to retirement by rotation. 226. be and is hereby appointed a Director of the Company. with or without modifications. if any.” 2. liable to retire by rotation. To consider and. Nariman Point. to pass. Bajaj Bhavan. with or without modifications. Chartered Accountants. Mumbai . if any. who retires from the office of Director by rotation in this Annual General Meeting and being eligible offers himself for re-election. 1956 (Act) and in respect of whom the Company has received a notice pursuant to Section 257 of the Act.” SPECIAL BUSINESS 5. 1956 (Act) and in respect of whom the Company has received a notice pursuant to Section 257 of the Act. to pass. Chaukar. 1956 (Act) and in respect of whom the Company has received a notice pursuant to Section 257 of the Act. Kishor A. To consider and. if any.400 021 to transact the following business: ORDINARY BUSINESS 1. 1956 (Act) and in respect of whom the Company has received a notice pursuant to Section 257 of the Act. if any. the following as an Ordinary Resolution: “RESOLVED THAT Mr. To consider and. D. be and are hereby re-appointed as the Auditors of the Company to hold office from the conclusion of this meeting until the conclusion of the next Annual General Meeting of the Company on remuneration to be decided by the Board of Directors.” Registered Office: Voltas Premises. the following as an Ordinary Resolution: “RESOLVED that the Company's audited Balance Sheet as at March 31. if thought fit. Amal Ganguli.T. be and is hereby re-elected a Director of the Company. who retires from the office of Director by rotation in this Annual General Meeting and being eligible offers himself for re-election. 2009 By order of the Board For TataTeleservices (Maharashtra) Limited Madhav Joshi Chief Legal Officer & Company Secretary 3 . if any. to pass. To consider and. To consider and. if thought fit. if any. To consider and. the audited Profit and Loss Account and the audited Cash Flow Statement for the financial year ended on that date together with Directors' and Auditors' Report thereon be and are hereby approved and adopted. Ramachandran. with or without modifications. with or without modifications. if thought fit. with or without modifications. if any. if thought fit. whose office shall be liable to retirement by rotation. if thought fit. who was appointed as an Additional Director of the Company and who holds office upto the date of this Annual General Meeting of the Company in terms of Section 260 of the Companies Act. To consider and. liable to retire by rotation. to pass.” 4. to pass. if thought fit. N.400 033. 2009. if thought fit. be and is hereby appointed a Director of the Company.NOTICE Notice is hereby given that the Fourteenth Annual General Meeting of Tata Teleservices (Maharashtra) Limited will be held on Thursday.” 3. Mumbai.” 7. with or without modifications. if any.

August 13. 2009 (both days inclusive). 5 to 8 above are annexed hereto and forms part of this Notice.tataindicom. As per the provisions of the Companies Act. Mumbai . Members whose shareholding is in electronic mode are requested to direct change of address notifications to their respective Depository Participants. the above Directors. Amal Ganguli. D. of persons seeking appointment/re-appointment as Directors are also annexed. Koichi Takahara was appointed as Additional Director of the Company with effect from July 1. 2009 By order of the Board For TataTeleservices (Maharashtra) Limited Madhav Joshi Chief Legal Officer & Company Secretary 4 . 2009.00 a. Mr. Mr. T. Chaukar. T B Kadam Marg. T. proposing their appointment as a Director of the Company. Mr. All documents referred to in the accompanying Notice and Explanatory Statement are also open for inspection by the Members at the registered office of the Company on all working days between 11. Keeping in view the experience and expertise of these persons. Joseph was appointed as Additional Director of the Company with effect from May 8. at the Meeting. 4. Joseph and Mr. 5. Amal Ganguli were appointed as Additional Directors of the Company with effect from March 24.m.The Company has received Notices along with requisite deposit under Section 257 of the Act. D. Kishor A. their appointment as Directors of the Company is recommended by the Board. th 2.The relevant details as required by Clause 49 of the Listing Agreements entered into with the Stock Exchanges. 2009. 5 to 8 of the Notice relating to their own appointment. 1956 (Act). The shareholders holding shares in physical mode only are requested to go through the circular and appoint nominee/s. 7. 1956 in respect of the business under Item Nos. Mr. August 3. 2009 to Thursday. if any. 3. 6.400 033. Members/proxies should bring duly filled Attendance Slips to attend the Meeting.com under the link “TTML” under the “About Us” link. Chinchpokli. in order to be effective. 5 to 8 of the Notice for approval of the Members. July 2. 2009. should be deposited at the registered office of the Company not less than 48 hours before the commencement of the meeting. Koichi Takahara are concerned or interested in the resolutions at Item Nos. The Explanatory Statement pursuant to section 173(2) of the Companies Act. Register of Proxies and Statutory Auditors' Certificate on Employee Stock Option Plan would be available for inspection by the Members. Details regarding the persons proposed to be appointed as Directors and their brief resume have been given in the Annexure attached to the Notice. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE AT THE MEETING INSTEAD OF HIMSELF AND A PROXY NEED NOT BE A MEMBER.14 Annual Report 2008-2009 Notes: 1. The Board commends the resolutions at Item Nos. Mr. to 1. hold office only upto the date of the forthcoming Annual General Meeting of the Company. The Register of Members and Share Transfer Books of the Company will remain closed from Monday. The Register of Directors' Shareholding. 1956 Item Nos. A proxy. A circular on the Nomination facility is available on the Company's web-site www.m. Kishor A. 5 to 8 Appointment of Directors liable to retire by rotation Mr. in respect of their physical shareholdings at the earliest.00 p. Mumbai. EXPLANATORY STATEMENT PURSUANTTO SECTION 173 (2) OFTHE COMPANIES ACT. up to the date of Annual General Meeting. Registered Office: Voltas Premises. Chaukar and Mr.

* l Hughes Communications India Ltd. Nil l Directorships held in other Public Companies# l l l l 5 l l l l l l l l Polaris Software Lab Ltd. Ahmedabad Chartered Accountant. Praj Industries Ltd. # Public Companies Excludes Foreign Companies and Section 25 Companies * Chairmanship of the Committee **includes only Audit Committee and Shareholders / Investor Grievance Committee . l ICRA Ltd. of India Ltd. TSR Darashaw Ltd. 2007) B. 2009 June 22. l Triveni Engineering & Industries Ltd. West Asia Maritime Ltd. Sasken Communications Technologies Ltd. 2007 (Appointed by shareholders at the AGM held on August 24. Ashok Jhunjhunwala Mr. 1953 April 12. Tata Communications Ltd. Exicom Tele-Systmes Ltd. Tata Communications Ltd. Chaukar Mr. Kishor A. l Investor Grievance Committee l Polaris Software Lab Ltd. 2009 July 1. Tata Autocomp Systems Ltd.* l Century Textile & Industries Ltd. 1947 March 24. 1939 March 24. 2007) Qualifications M. ICRA Ltd.* l Tata Communications Ltd.* Audit Committee Maruti Suzuki India Ltd. Hughes Communications India Ltd. HCL Technologies Ltd.* l New Delhi Television Ltd. Wartsila India Ltd. Tata Industrial Services Ltd. 2002 (Last re-appointment was by shareholders at the AGM held on August 24. State Bank of India 3i Infotech Ltd. (Power Engineering) Expertise in specific functional area Rich experience in Telecom. Tata Industries Ltd. MBA from University of Maryland (USA) Rich experience in Telecom Nil Mr.* l Wartsila India Ltd. Ocean Sparkle Ltd. l Memberships / Audit Committee l Tata Teleservices Ltd.Tech from IIT. Ramachandran Date of Birth March 25. Tata Petrodyne Ltd. Koichi Takahara Particulars Mr. Tata Yazaki Autocomp Ltd. respectively Rich experience in Administration Nil Masters of Engineering from Kyoto University (Japan). Century Textile & Industries Ltd. Tata Teleservices Ltd. Nil Audit Committee State Trading Corp. Kanpur & MS and Ph. Tejas Networks Ltd. Education and Research & Development 3.D degrees from the University of Maine Post Graduate in Management from the IIM. AVTEC Ltd. Chairmanships of Committees** of other Public Companies# Audit Committee l Polaris Software Lab Ltd. Tata Investment Corporation Ltd.700 Nil Nil Rich experience in Telecom (Member of TRAI from 1997 to 2000) Rich experience in Finance and telecom Rich experience in finance Number of shares Nil held in the Company (Including held by dependents) l l l l l l l l l l l l l l l l l l l l l l l l l Tata Teleservices Ltd. 1962 October 17. of India Ltd. l HCL Technologies Ltd. l State Bank of India l Tejas Networks Ltd. Audit Committee Tata Business Support Services Ltd. 2009 April 5. l Tube Investments of India Ltd. Tata Advance Materials Ltd. member of the Institute of Chartered Accountants in England & Wales and the ICAI Masters degrees in English Literature and Economics from the University of Madras and University of Manchester. 1939 Date of Appointment December 6.Details of Directors Seeking Appointment / Reappointment at the Annual General Meeting (AGM) Prof. T. State Trading Corp. l Tata Teleservices Ltd. Ltd.* l Aricent Technologies (Holdings) Ltd.* l Tata Autocomp Systems Ltd. Tata Business Support Services Ltd. Investor Grievance Committee l Tata Communications Ltd. Tata Communications Ltd. E. IDFC Private Equity Co. Shreyas Shipping & Logistics Ltd. 1945 May 8. D. N. Amal Ganguli Mr. l Sasken Communications Technologies Ltd. Triveni Engineering & Industries Ltd. l Mundra Port & Special Economic Zone Ltd. Maruti Suzuki India Ltd. Tube Investments of India Ltd. Joseph December 21. New Delhi Television Ltd. S. 2009 August 1. Aricent Technologies (Holdings) Ltd.

compared with 14. Cost efficiencies will be achieved in the GSM roll-out by synergizing with the infrastructure already created for the CDMA deployment.93 125.60 1.789.41 1. this.460. A significant portion of this increase took place in semi-urban and rural Maharashtra. During the year. and the introduction of innovaive tariffs. 2. while it is 75 per hundred in cities like Mumbai and about 13 per hundred in rural areas. Cost optimization efforts.28 2.05 485. The Directors have pleasure in presenting the 14 Annual Report together with the audited financial statements of the Company for the year ended March 31.053. however.79 158.81 0.The current subscriber base of more than 75 lakhs consists of CDMA wireless subscribers and wireline subscribers.941. The national mobile tele-density is about 39 per hundred. As of May 2009.96 crores. Financial Results The financial results of the Company's operations during the year are given below: (Rs. Products and Services The Company holds two Unified Access (basic + cellular) Service Licences (UASL). notes and certificates. accompanied by competitive pressures which pulled tariffs down. resulted in lower Average Revenue per User (ARPU) compared to the previous year. India today has the second largest telecom network in the world after China. the Company focused on increasing its retail presence to penetrate the market better with its various products and services. 593.74 The total revenue grew by 14. in crores) th Particulars Telecom Revenue Other Income Total Income Expenditure Earnings Before Interest. 6 .02% in operating expenses.e. there were more than 452 million telephone connections in the country.14 Annual Report 2008-2009 th DIRECTORS' REPORT Dear Members.55 crores. fixed wireless and mobile).96 1.053. one for Mumbai Metro and the other for the Rest of Maharashtra and Goa.The Company will launch its GSM services in the next few months. The wireless/mobile subscriber base increased from 46. During the year.Telephone connections are expected to touch the 500 million mark by the year 2010.39 1.78 593.01 439. representing a significant improvement over the previous year's EBIDTA of Rs.304. Depreciation. The subscriber base grew by 48% to cross 74 lakhs (in March 2009).18 crores. 485. This growth was fueled by the increase in network coverage.68 112.58 lakhs.77% increase in revenues. Approximately 10-15 million mobile connections are being added every month.78 446.707. 2009 and other accompanying reports.18 304. Major growth will come from rural and semi-urban areas.77% to Rs.19 82.60 2007-08 1. mainly through the increased additions to the Prepaid Mobile subscriber base.55 171.The Company reported a positive EBIDTA of Rs. where income levels were lower than the urban centres. Tax and Amortisation (EBIDTA) Finance & Treasury Charges (Net) Depreciation Loss before tax Extraordinary item Loss before tax Fringe Benefit tax Loss after tax 2008-09 1. the Company consolidated its position in the market by increasing its share of new additions in the wireless market (i.35 124. accompanied by the introduction of new handsets at attractive prices. ensured a lower rate of increase of 12.39 158.80 lakhs to 69.81 124.21 159.

partnerships with content providers. It now offers services in 1. The Company covered more than 95% of development blocks and is eligible to get the concession on license fees for extensive rollout as per the DoT notification. The Company. New Customer Offerings During the year. retail and other fields have made retention of good employees very challenging. Human Resources The Company attaches utmost importance to its human resources which are very critical for a service organization like the Company. Increased job opportunities in telecom. Key features of the BlackBerry® 8830 include Seamless International Roaming. leveraging the highly reliable Tata Indicom wireline network in Mumbai to deliver to retail customers for the first time speeds of upto 100 Mbps.8830 offering the convenience of being constantly accessible on mail while undertaking parallel activities such as talking on the phone and surfing the internet. Quality and Processes The Company has undertaken ISO 9001:2000 certification to demonstrate its capability to consistently provide services that enhance customer satisfaction through effective deployment of a quality management system. leased lines and dialup internet access.000 buildings with broadband services. SMS.The Company continued to focus on value added service offerings.The Company would continue to make investments to strengthen its Digital Mumbai offerings and would increase voice and data penetration in already wired buildings. offering speeds upto 3. The Company has been striving towards institutionalizing a performance oriented culture and also creating 'Ideal Place to work'. and Instant Messaging. offered over Ethernet. Banking activities on mobile using SMS like checking balance. leading to additional time and efforts to acquire and retain customers. Organizer. scheduling and coordinating appointments in the middle of meetings. with 15 Points of Presence across the country for providing local access to conference bridges. transfer of funds and payment of bills. request for cheque books and checks on loan and Credit Card accounts. Power Launcher ultra high speed broadband data products. besides enhancing the customer value proposition with initiatives like combo offers of voice and broadband. Recognition of Customer Service and Network quality The Company has been rated as the No. a division of Tata Sons Limited. and updating business databases. trained human resources.148 towns. Wireless Internet. Entry of 4-5 new service providers has provided increased choice to customers. mini statement. and brand promotion through a TM Digital Mumbai portal. The Company became the first basic telecommunication provider to get the coveted ISO 9001:2000 certification in August 2002. 7 . The Company's network has also been rated in successive TRAI reports as the only congestion free network across Maharashtra and Mumbai. Network Rollout During the year. 1 wireless telecom service provider in terms of overall customer satisfaction across the Mumbai and Maharashtra Circles in independent studies commissioned by Telecom Regulatory Authority of India (TRAI). media. the Company was awarded a Certificate of Continuation for ISO 9001:2000 with ‘Nil’Non-Conformance. Email. with knowledge sharing and appropriate support being extended by Tata Quality Management Services (TQMS). the Company rolled out CDMA wireless services in 583 new towns in Maharashtra and Goa. The Company is also taking active part in the Tata Business Excellence Model (TBEM) process. BlackBerry® . The Company's subscribers are therefore able to enjoy uninterrupted services while traveling by road and rail along major travel routes in Maharashtra and Goa. along with Tata Teleservices Limited (TTSL). The Company is a Category A (National) ISP Licensee and offers a broad range of Internet-related product offerings including Digital Subscriber Lines (DSL). the Company introduced several attractive product and service propositions that addressed specific customer needs. Digital Mumbai TM The Company has laid over 1500 kms of buried fibre across Mumbai and already connects over 20. In the recent Certification Audit conducted by TUV India in November 2008.1 Mbps. thereby creating increasing pressures to retain valuable. and information on Mutual Fund policies. has a national footprint for its popular Tata Indicom conference call service. Voice calls. including: · · · · Photon+ express wireless broadband service. 20 times faster than other wireless technology.

effective April 1. Ratan N. 2009. performance management system. 2009. Regular communication channels are maintained with the employees through Open Door Policy. Tata relinquished the office of Director and Chairman of the Company and Mr. Subsidiary The Company had acquired a Wholly Owned Subsidiary i. 2009. Arunkumar R. 2009. Regulatory Developments and Important Litigation a) There have been many regulatory changes. Mr. resolutions seeking the approval of the Members for the appointment of Mr. Chaukar. Dividend & Appropriations In view of losses. Information on the regulatory developments and important litigation has been provided in the report on Management Discussion & Analysis of Financial Condition and Results of Operations which forms part of this Annual Report. Termination charges payable to terminating operators have been reduced to 20 paise from 30 paise per minute which will bring down income as well as expenditure.14 Annual Report 2008-2009 It provides extensive training and works for employee development and retention through various initiatives. Axis Risk Consulting Services Private Limited as the Internal Auditors. There has been no appreciable progress in these cases since the last Annual Report. Mr. A statement pursuant to Section 212 of the Companies Act. 8 . Ganguli. iii. the penalty imposed by the DoT for the launch of innovative Push to Talk services. D. Mr. in respect of CITL and its financial statements for the financial year 2007-08 and 2008-09 together with the Report of the Directors and Auditors thereon. The Department of Telecommunications (DoT) has taken steps to implement Mobile Number Portability (MNP) in Metros by September 2009. Statutory Auditors M/s Deloitte Haskins & Sells. the Directors regret their inability to recommend any dividend for the year under consideration. 2008. T. Mr.e. b) The Company has also been a party to some important litigation like Fixed Wireless ADC demands of BSNL of 2004-05. recruitment.f. Departmental meets and other initiatives. have been aligned with the business objectives of the Company. Internal Auditors The Board has re-appointed M/s. Town Halls.The Audit Committee and the Board recommend their re-appointment. prominent among which have been i. Joseph and Mr. Koichi Takahara was appointed as an Additional Director w. It has divided the country into 2 zones and has signed licence agreements with two clearing/porting agencies. The HR systems e. 21st Century Infra Tele Limited (CITL) with effect from July 1. The Hon'ble Delhi High Court and the Telecom Dispute Settlement Appellate Tribunal (TDSAT) upheld the validity of DoT's decision to allow use of dual technology and allocation of dual technology spectrum. 1956. Chaukar was appointed as an Additional Director and Chairman of the Company and Mr. Gandhi also relinquished the office of Director of the Company with effect from March 23. the present statutory auditors retire at this meeting and are eligible for re-appointment. Amal Ganguli was appointed as an Additional Director (Independent Director) with effect from March 24.The Board records its sincere appreciation of the valuable services rendered by them. and industry litigation on exclusion of revenues unrelated to licensed activities for determining licence fee liability. Accordingly. July 1. ii. the DoT's attempt to lodge a counter-claim on the Company for not signing in 1997 the licence agreement for basic services in the Karnataka circle.g. some of which are managed by the employees themselves through voluntary participation. Ramachandran and Prof. Takahara as Directors of the Company and re-appointment of Mr. are attached to the accounts of the Company.e. th iv. Kishor A. Mr. rewards and recognition. The Board recommends these appointments in the interests of the Company. Joseph was appointed as an Additional Director (Independent Director) with effect from May 8. Directors Mr. Termination of Access Deficit Charge (ADC) which was payable by all operators to Bharat Sanchar Nigam Limited (BSNL). Jhunjhunwala who retire by rotation and offer themselves for re-election have been incorporated in the Notice of the forthcoming Annual General Meeting along with brief details about them. No appropriations are proposed to be made for the year under consideration. Chartered Accountants. 2009.

Balance Sheet Abstract and Company's General Business Profile Information pursuant to Department of Company Affairs' notification dated May 15. for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. In the preparation of the annual accounts. 1. relating to the Balance Sheet Abstract and General Business Profile of the Company is given in the Annual Report for information of the shareholders. 1956 (Act). the Directors. Directors Comments on Auditors' Observations: · With regard to the Auditors' observation in paragraph (xi) in the Annexure to the Auditors' Report. while the accumulated losses of the Company at the close of the year have exceeded its paid up capital and reserves. the Company has had its Business Plan appraised by IDBI Bank Limited and is in the advanced stages of financial closure and the short term loans would be replaced by long term loans. the accumulated losses of the Company. 4. is not uncommon for telecommunication service providers in their initial years of commercial operations. The Company regularly reviews power consumption patterns across its 9 . The Company is consistently making cash profits. The Company has not incurred cash losses during the financial year under audit and in the immediately preceding financial year. and according to the information and explanations given to us. 2. They have taken proper and sufficient care. and the rules made thereunder.66 crores as license fees for providing services using GSM technology under the existing licenses and expects to roll-out the related services during the next financial year. 1988 are given below: (i) Energy Conservation: Electricity is used for the working of the Company's telephone exchanges and other network infrastructure equipment. The Company in the previous year had also paid Rs. 1995. due to high operation costs of heavy infrastructure and high and continuing capital requirement for building the network.70 crores. funds raised on short term basis have. · With regard to the Auditors' observation in paragraph (xvi) in the Annexure to the Auditors' Report. Conservation of Energy. 3. the Company is confident of it's ability to continue in business as a going concern and the accounts have accordingly been prepared on this basis. the applicable accounting standards have been followed and there are no material departures.392. xvi) According to information and explanations given to us and on overall examination of the balance sheet of the Company. confirm that: 1.Statutory Disclosures · Directors' Responsibility Statement Pursuant to the provisions of Section 217(2AA) of the Companies Act. while the Company had availed of short term bridge loans for its expansion plan. been used for long term investment to the extent of Rs.909.Technology Absorption and Foreign Exchange Earnings and Outgo The disclosures as required under the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules. They have prepared the annual accounts on a going concern basis. based on the representations received from the operating management. Based on the foregoing considerations. They have. and have applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the period. at the end of the financial year are more than fifty percent of its net worth. · Auditors' Observations Attention is invited to the following paragraphs in the Annexure to the Auditors' Report wherein they have observed as follows: xi) In our opinion. to the best of their knowledge and ability. in the selection of the accounting policies. this. for the maintenance of adequate accounting records in accordance with the provisions of the Act. Fixed Deposits The Company has not accepted any deposits within the meaning of Section 58A of the Act. prima facie.The Company is in advanced stages of financial closure for proposed GSM and other Network Roll out and would be able to meet its further funding requirements. consulted the Statutory Auditors. and has been able to grow its subscriber base and network.

The Company had issued stock options during the period 1999-2001. A certificate from DHS with regard to compliance with the corporate governance code by the Company is annexed hereto as Annexure II and forms part of this report.88 197. Chaukar Chairman 10 .14 Annual Report 2008-2009 network and implements requisite improvements/changes in the network or processes in order to optimize power consumption and thereby achieve cost savings. financial institutions.39 2007-08 NIL 21. (ii) (iii) Technology Absorption: The Company has not imported any technology. Any Member interested in obtaining a copy of such information may write to the Company Secretary at the registered office of the Company. banks. Foreign Exchange Earnings and Outgo: (Rs. Corporate Governance A report on Corporate Governance appears after this report. The Company has fully complied with all mandatory requirements prescribed under Clause 49 of the listing agreements with the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE). July 2. read with the Companies (Particulars of Employees) Rules. A certificate from M/s Deloitte Haskins & Sells (DHS). Government and others associated with the activities of the Company.The Company has also implemented some of the non-mandatory provisions. The information as required to be disclosed in the Annual Report pursuant to the Securities & Exchange Board of India (Employees' Stock Option Schemes and Employees' Stock Purchase Scheme) Guidelines. with regard to the implementation of the Company's Employees' Stock Option Plan. 2009 Kishor A.88 th Particulars of Employees and Stock Options The particulars of employees as required under Section 217(2A) of the Act.99 364. Acknowledgements The Directors wish to place on record their sincere appreciation of the assistance and support extended by the employees. However. crores) Particulars Earnings Outgo Capital Goods 2008-09 NIL 22. in pursuance of Section 219(1)(b)(iv) of the Act. customers. The Company has not yet established separate R & D facilities. vendors. Statutory Auditors. 1999 is annexed to this Directors' Report as Annexure I and forms part of this report. this report is being sent to the shareholders of the Company excluding the aforesaid information. For and on behalf of the Board of Directors Mumbai. would be open for inspection in the ensuing Annual General Meeting. 1975 forms part of this report.

) .ANNEXURE I PARTICULARS PURSUANT TO THE SECURITIES & EXCHANGE BOARD OF INDIA (EMPLOYEES' STOCK OPTION SCHEMES AND EMPLOYEES' STOCK PURCHASE SCHEME) GUIDELINES. 2009 349 Nil (ii) During FY 2008-09 * Also includes employees who have since left the employment of the Company (0. 1999 Options granted: (i) (ii) Cumulative (cum.with extra ordinary item (Rs.745 24.) Options exercised (cum.) During the year 2008-09 Pricing formula Options vested (cum.) (Rs.without extra ordinary item (Rs.) Number of employees to whom options have been granted: (i) Cumulative* till March 31.855 12.54.950 NIL None 11 .70.48.) Variation of terms of options Money realised by exercise of options (cum.630 24.33.550 Nil Not Applicable 25.70) (0.) Options lapsed (cum.) Total number of options in force Options granted to senior managerial personnel during year 2008-2009: Any other employees to whom 5% or more of the total options have been granted during the year Identified employees to whom options have been granted equal to 1% or more of the issued capital (excluding outstanding warrants & conversions) of the Company at the time of grant Diluted Earning Per Share (EPS) pursuant to issue of shares on exercise of option calculated in accordance with International Accounting Standard (IAS 33) .550 7.70) None 37.855 Not varied 2.45.) Total number of shares arising as a result of exercise of options (cum.13.54.

We state that no investor grievance is pending for a period exceeding one month against the Company. It is neither an audit nor an expression of opinion on the financial statements of the Company. we certify that the Company has complied in all material aspects with the conditions of Corporate Governance as stipulated in the above-mentioned Listing Agreement. In our opinion and to the best of our information and according to the explanations given to us. The Compliance of conditions of Corporate Governance is the responsibility of the Management. B. Our examination was limited to procedures and implementation thereof. Dated: May 11. as stipulated in Clause 49 of the Listing Agreement of the said Company with the stock exchanges. Jani Partner Membership No: 46488 Mumbai.14 Annual Report 2008-2009 th ANNEXURE II AUDITORS’ CERTIFICATE To the members of TataTeleservices (Maharashtra) Limited We have examined the compliance of conditions of Corporate Governance by Tata Teleservices (Maharashtra) Limited for the year ended on 31st March 2009. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the Management has conducted the affairs of the Company. adopted by the Company for ensuring compliance of the conditions of Corporate Governance. 2009 12 . For Deloitte Haskins & Sells Chartered Accountants A. based on the records maintained by the Investors Services Department and as certified by the Compliance Officer of the Company.

(c) issue of securities by way of public/rights/bonus issue etc. specified persons (Directors/Officers/ Designated Employees) of the Company are prohibited from dealing in the securities of the Company during the period when the Trading Window is closed.CORPORATE GOVERNANCE REPORT FOR THE YEAR 2008-09 STATEMENT OF COMPANY'S PHILOSOPHY ON CORPORATE GOVERNANCE The Company believes in the highest standards of good and ethical corporate governance practices. which can be perceived to be intended to obtain business or uncompetitive favours. The Audit Committee is also authorized to supervise the conduct of investigations of any disclosures made by whistle blowers in accordance with policy. as the case may be.com.The above Code had been adopted by the Board at its meeting held on July 19. which affords protection and confidentiality to whistle blowers. As regards declaration of interim dividend and other matters referred to in (c) to (g) above. (e) amalgamation.e. The Managing Director/Chief Executive Officer is also required to designate a senior employee who would be in-charge of the project. In terms of the Code. Maintaining quality of products and services. half-year or financial year. Such team members are required to execute an undertaking not to deal in the securities of the Company till the Price Sensitive Information regarding the activity/project is made public or the activity/project is abandoned and the Trading Window would be regarded as closed for them. (b) declaration of dividends (interim and final). The Company's Board of Directors (hereinafter referred to as 'the Board') has adopted the Tata Code of Conduct for its senior management including the Managing Director. Fair and accurate presentation of financial statements. (f) disposal of whole or substantially whole of the undertaking. plans or operations of the Company. the Trading Window remains closed from the end of the respective quarter. well before initiation of such activity/project.The Company has also adopted a Code of Conduct for its Non-Executive Directors. Prohibition of taking gifts and donations. Practicing political non-alignment. 1992 (Regulations). WHISTLE BLOWER POLICY The Company has adopted a Whistle Blower Policy. to form a core team of Designated Employees and/or Designated Group Persons who would work on such assignment. In respect of declaration of financial results. CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING In compliance with the Securities & Exchange Board of India (Prevention of Insider Trading) Regulations. and Commitment to enhancement of shareholder value. www. The Trading Window for dealing in securities of the Company is closed for the following purposes. 13 . No personnel have been denied access to the Audit Committee. the Company had framed a Code of Conduct for Prevention of Insider Trading and Code of Corporate Disclosure Practices (Code) in line with other Tata Companies for prevention of insider trading and ensuring timely disclosures of all material price sensitive information in a transparent manner. Ethical conduct.tataindicom. the Company has adopted a revised Code with effect from March 1. Being a good Corporate Citizen. half-yearly and annual). 2009. Being an Equal Opportunities employer. (d) any major expansion plans or execution of new projects. Both these Codes are available on the website of the Company i. 2004. namely (a) declaration of financial results (quarterly.. and (g) any significant changes in policies. The Trading Window is opened 24 (twenty-four) hours after the information referred to above is made public. takeovers and buy-back. the Managing Director/Chief Executive Officer is required.The Audit Committee Chairman is authorized to receive Protected Disclosures under this policy. The Company's corporate governance philosophy has been further strengthened through the Tata Code of Conduct for Prevention of Insider Trading and Code of Corporate Disclosure Practices. mergers. TATA CODE OF CONDUCT The Tata Code of Conduct governs: (a) (b) (c) (d) (e) (F) (g) (h) (i) Conduct of business in consonance with national interest. Consequent to the recent amendments in Regulations.

f.f. Chaukar* (Chairman) Mr. 2009 is given below. 2009. The Board has agreed that Non-Executive Directors are not and shall not be responsible for the day-to-day affairs of the Company.14 Annual Report 2008-2009 CODE OF CONDUCT All Directors and senior management personnel have affirmed compliance with the respective Codes for the financial year ended March 31. None of the Directors is a member in more than 10 mandatory committees nor acts as a Chairman in more than 5 mandatory committees across all public companies in which they are Directors. Nadir Godrej Prof. Ramadorai Mr. of Committee Number of Relationship No. Appointed as Additional Director w.The declaration by the Managing Director in this respect appears elsewhere in this Annual Report. Directorships do not include alternate Directorships. The Company is managed by the Managing Director under the supervision and control of the Board. th Name of the Director Category No. Ashok Jhunjhunwala Mr. BOARD OF DIRECTORS Composition As on March 31. Section 25 Companies and bodies corporate incorporated outside India.700 None None None None None None None None 3 3 2 11 12 11 9 2 10 3 3 2 5 1 1 1 1 1 2 5 2 5 2 4 1 1 Mr. Mukund Rajan (Managing Director) * ** Non-Executive Director Independent Director Independent Director Independent Director Independent Director Non-Executive Director Non-Executive Director Executive Director Appointed as Additional Director and Chairman w. March 24. The Board composition and the number of Chairmanships/Directorships of the Board and Chairmanships/Memberships of the Committees of the Board held by each of Directors as on March 31.e. of Directorships with in all public Positions held in all Shares companies other Public Companies held in Directors Company including shares held by Chairman Member Chairman Member dependents 3.e. S. The Managing Director is assisted by a team of highly qualified and experienced professionals. Amal Ganguli** Mr. 7 (88%) of Directors are NonExecutive. 2009. 2009. 14 . the Company had 8 Directors with a Non-Executive Chairman. March 24. S. but includes Directorship of the Company. Directorships of private limited companies. and 4 (50%) of them are Independent Directors. Ramachandran Mr. N. Chairmanships/Memberships of Board Committees cover only Audit and Shareholders/Investor Grievance Committees across all public limited companies (listed as well as unlisted) including those of the Company. Kishor A. Anil Sardana Dr. 2009.

Kishor A. There is no separate provision for payment of severance fees.for every meeting of any other Committee of the Board. no sitting fees were paid to Non-Executive Non-Independent Directors. Ratan N. The details of remuneration paid by the Company to its Directors during the financial year 2008-09 is as follows: 15 . 2008. Gandhi* Mr. 2009. 2008. Chaukar**# Mr. With effect from October 1. Ratan N. 2009 in Board Meetings and AGM of the Company is as under: Name of the Director No. and incentive remuneration to its Managing Director. 8. The Company pays remuneration by way of salary. 2008. Audit and Remuneration Committee and Rs.000/. 2009 and March 23. Tata* Mr. the Independent Directors were paid sitting fees of Rs. Six meetings of the Board were held during the financial year ended on March 31. 2008. 5. The meetings of the Board were held on May 20. N. allowances. 2009.The Annual General Meeting (AGM) was held on August 12. 2008. Independent Directors: Sitting fees of Rs.per head per meeting were paid to the Independent Directors for attending meetings of the Board and Audit Committee and Rs. 5. Nadir Godrej Prof.per head per meeting for other Committee meetings till September 30. December 24. of Meetings during 2008-09 Held Attended 2 6 4 4*** 6 5 5 6 Attendance at Last AGM Yes Not Applicable No Not Applicable Yes Yes No Yes Yes Yes Mr. 15.000/. *** Excluding 1 Board Meeting attended through audio conferencing.for every meeting of the Board. Mukund Rajan * 6 6 6 6 6 6 6 6 Ceased to be a Director with effect from March 23. S.000/. 2008. Amal Ganguli** # Mr. 2009. Ashok Jhunjhunwala Mr. S. 5. July 16. Anil Sardana Dr. Tata) were paid Rs. ** Appointed as Director with effect from March 24. Non Executive Non-Independent Directors: Non Executive Non-Independent Directors (except Mr. 2008. None of the Directors have been issued any stock options by the Company during the year. January 19.The contract with the Managing Director may be terminated by either party by giving six months notice or the Company paying six months salary in lieu thereof.000/. retiral benefits. 2009. Directors' Remuneration None of the Non-executive Directors have any material pecuniary relationship or transaction with the Company. 2008. perquisites. Ramachandran Mr.per head per meeting for attending Board/Committee Meetings till September 30. Arunkumar R. # Details provided from the date of appointment. The Company also reimburses the out-of-pocket expenses incurred by the Directors for attending Meetings.000/.The details of participation of the Directors of the Company during the financial year ended March 31. With effect from October 1. 2008. Ramadorai Mr. October 27.Board Meetings and Annual General Meeting The Board meets at least once in each quarter and the maximum time gap between two Board meetings did not exceed the limits prescribed in Clause 49 of the listing agreement. Increments are decided by the Remuneration Committee within the salary scale approved by the Members and the limits approved by the Central Government.

Amal Ganguli** Mr. Chairman Mr.71. Chaukar** Mr. Ramadorai Mr.f. S.f.14 Annual Report 2008-2009 A) Non Executive Directors th Name of the Director Mr.e.) 73. Ashok Jhunjhunwala. Tata* Mr. Chief Financial Officer. has been duly placed.f.50.The composition of the Committee is as follows: Name of Member Category No. Ramachandran Mr. N. ** Incentive Remuneration for FY 2007-08 was paid in FY 2008-09. all of whom are NonExecutive Directors and 2 of them are Independent Directors. Anil Sardana * Ceased to be a Director w.000 140. 1956 and comprises 3 members.e. Ashok Jhunjhunwala Mr. S. # Details provided from the date of appointment. 16 . 2009. Arunkumar R.000 * Incentive Remuneration for FY 2008-09 would be decided by the Remuneration Committee of the Company in due course. March 23.58. The Company Secretary acts as the Secretary to the Committee. March 23.) 15. Ratan N. March 24. The Committee functions under the Chairmanship of Prof. N. of Meetings during 2008-09 Held Attended 5 5 5 5 5 3 Prof.e. Ashok Jhunjhunwala. Gandhi* Mr.000 60. 2009.597 -* 77. Kishor A. Information placed before Board of Directors All information required to be placed before the Board of Directors under Clause 49 of the listing agreements with the stock exchanges. Mukund Rajan Mr. The functional heads are also invited as and when required.000** Total Dr.f. S. Charles Antony 1. B) Managing Director Name of the Director Salary (Rs.) 12. Ramadorai* # Mr. 2009. Nadir Godrej Prof. S.07. ** Appointed as Director w.27.597 77.000 117.000 10.000 Retirals & Incentive Perquisites Remuneration (Rs. 2009. Gandhi** Independent Director Independent Director Non-Executive Director Non-Executive Director * Appointed as Member of the Committee w. March 30. The Audit Committee meetings are also attended by the Managing Director.000 Allowances (Rs. Ramachandran Mr.e.50.000 - Sitting Fees (Rs. Statutory Auditors and Internal Auditors. Arunkumar R.) 21. AUDIT COMMITTEE Composition The Audit Committee of the Board of the Company has been constituted in compliance with the provisions of Clause 49 of the listing agreement read with Section 292A of the Companies Act.000 5. ** Ceased to be a Member of the Committee w.60.

Recommending the appointment and removal of external auditor. to be included in the Company's Annual Report to its shareholders. debenture holders. INVESTOR GRIEVANCES COMMITTEE Composition &Terms of Reference The Investor Grievance Committee of the Board looks into redressal of the shareholders' complaints in respect of any matter including transfer of shares.The Audit Committee meets at least once in each quarter and the maximum time gap between two Audit Committee Meetings did not exceed the limits prescribed in Clause 49 of the listing agreement. staffing and seniority of the official heading the department. 2009. sufficient and credible. The delegates regularly attend to share transfer formalities at least once every 15 days. management letters from Auditors. fixation of audit fee and also approval of payment for any other services. dematerialization of shares. 2008 and January 19. S. including the structure of the internal audit department. internal audit reports. Looking into reasons for any substantial defaults in payment to depositors. Discussing with external auditors before the commencement of the audit about the nature and scope of audit as well as having post-audit discussions to ascertain any areas of concern. Ramachandran. proposals and terms of appointment of internal auditors. N. Discussing with internal auditors any significant findings and follow up thereon. shareholders (in case of non payment of declared dividends) and creditors. the adequacy of internal control systems and ensuring compliance therewith. Reviewing the quarterly. Mukund Rajan Category Independent Director Executive Director Mr. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting these matters to the Board. and coverage and frequency of internal audit. 2008. October 27. The Meetings were held on May 9. fraud-related reports. Terms of Reference The terms of reference for the Audit Committee are broadly as under: a) b) c) d) e) f) g) h) i) j) k) l) Overseeing the Company's financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct. 17 . Reviewing with the management. The Composition of the Committee is as follows: Name of the Member Mr. half yearly and annual financial statements before submission to the Board. Madhav Joshi. 2008. non-receipt of declared dividends. Management Discussion & Analysis of Financial Condition and Results of Operations. Chief Legal Officer & Company Secretary. as a part of financial results statements. statements of related party transactions. issue of duplicates and renewed share certificates. July 9. 2008. have been regularly placed before the Audit Committee for review during the financial year 2008-09. Chairman Dr. focusing primarily on any related party transactions as per Accounting Standard 18. Reviewing the Company's financial and risk management policies. 2009.The Committee is authorized to delegate its powers to officers and employees of the Company and/or of the Company's Registrar and Share Transfer Agent. Five Audit Committee Meetings were held during the financial year ended on March 31. etc. Reviewing the report on Management Discussion & Analysis of Financial Condition and Results of Operations. non-receipt of annual report. is the Compliance Officer of the Company. quarterly results. July 16. reporting structure. IPO refunds and complaints. external and internal auditors. Reviewing the adequacy of the internal audit function. Reviewing the functioning of the Whistle Blower Policy adopted by the Company.

Ethics and Compliance Committee to consider matters relating to Insider Trading Code. all of whom are Non-Executive Directors and two are Independent Directors. March 30. the Company assesses the risk management framework periodically. 2008 Venue Mumbai Mumbai Mumbai Details of special resolutions passed in the above referred meetings are as under: Particulars of the AGM 12 AGM held on August 24.f. The Board has also formed other Committees i. The scope of the Audit Committee includes review of the Company's financial and risk management policies. March 23. Chairman Mr. 1956 Purpose Keeping of statutory records at the office of the Company’s Registrars & Share Transfer Agents Section 31 of the Companies Act.e. S. 2009. 2007 August 12. REMUNERATION COMMITTEE The Company has constituted a Remuneration Committee for the purpose of approving from time to time. Nominations Committee to make recommendations regarding the composition of the Board and identification of Independent Directors to be inducted on the Board and take steps to refresh the composition of the Board from time to time and Executive Committee to review business and strategy. The Committee's composition is as under: Name of Member Mr.e. Further. Chaukar**# Category Independent Director Non-Executive Director Independent Director Non-Executive Director No. 2009. Ashok Jhunjhunwala Mr. Ratan N. During the financial year 2008-09. ** Became a member of the Committee w. N. 1956 Amendment of Articles of Association to allow conduct of any business through Postal Ballot 18 . The Company's Remuneration Committee comprises 3 Directors.f. of Meetings during 2008-09 Held 1 1 1 Attended 1 1 1 - * Ceased to be a Member of the Committee w. 1995. 2006 August 24. the Company has held 13 Annual General Meetings (AGMs) and 12 Extra Ordinary General Meetings of the shareholders. GENERAL BODY MEETINGS The Company's first statutory meeting was held on April 24. or to perform such task/s as may be entrusted by the Board from time to time. # Details provided from the date of appointment.The details of the last 3 AGMs are as under: Particulars 11 Annual General Meeting 12th Annual General Meeting 13 Annual General Meeting th th Date August 10. Till date. 2007 th Section under which special resolution was passed Section 163 of the Companies Act.14 Annual Report 2008-2009 The details of complaints received and redressed during the year is as follows: Opening Balance 1 Received during the year 213 Resolved during the year 209 Closing Balance 5* th *since resolved The status of complaints is reported to the Board on a quarterly basis. Kishor A. the Committee met once on August 12. RISK MANAGEMENT The Company has devised a formal Risk Management Framework for risk assessment and minimisation. Tata* Prof. the remuneration payable to the Managing Director and Executive Director/s and to discharge any other statutory duties and functions as may be specified under the law. Ramachandran. 2008.e.

400 021. 2009. RELATED PARTYTRANSACTIONS There were no materially significant related party transactions during the year. Bajaj Bhavan. 1956 Re-appointment of Mr. 269. 2008 was passed during the year through Postal Ballot. shareholding patterns.Section 198. Managing Director for Financial Year 2006-07 Consent for issue of Foreign Currency Convertible Bonds POSTAL BALLOT A Special Resolution for appointment of Dr. 15 of Schedule 17 to the Accounts in the Annual Report. Apart from paying sitting fees. 310.Transactions with related parties are disclosed in Note No. for the financial year 2008-09. confirming compliance with the mandatory requirements of the said Clause. CERTIFICATION WITH RESPECT TO FINANCIAL STATEMENTS The certificate as required under Clause 49 of the listing agreement is furnished by the Managing Director and the Chief Financial Officer of the Company to the Board of Directors of the Company with respect to accuracy of financial statements and adequacy of internal controls. 310. Mr.tataindicom. 311 of the Companies Act. 1956 Increase in remuneration payable to Mr. 226.99% votes cast in favour of the resolution. press releases. Mukund Rajan as the Managing Director of the Company as contained in the Notice to the shareholders dated April 10. with 99. 19 .com. 317 of the Companies Act. MEANS OF COMMUNICATION The quarterly. The Company had complied with the procedure as specified by Companies (Passing of the Resolutions by Postal Ballot) Rules. GENERAL SHAREHOLDER INFORMATION Annual General Meeting The ensuing Fourteenth Annual General Meeting is scheduled to be held on Thursday. Makarand Joshi. nor have any penalties or strictures been imposed on the Company in this respect. 309. which in the opinion of the Board may have potential conflicts with the interests of the Company at large. Jamnalal Bajaj Marg. there was no pecuniary transaction undertaken by the Company with the independent/non-executive directors during the year ended March 31. 1956 Section 81 of the Companies Act. Nariman Point.The Board has not recommended any Special Resolution for approval of the Members th at the ensuing 14 Annual General Meeting through Postal Ballot. Mumbai . 316. 314. and presentations made to institutional investors and analysts are also available on the website of the Company i. Practicing Company Secretary was appointed as the Scrutinizer for overseeing the Postal Ballot process. Charles Antony as Managing Director and the remuneration to be paid for a period o f 3 years from the date of his re-appointment as Managing Director of the Company Section 269. half yearly and annual results are published in Marathi and English Newspapers. As required under Clause 49 of the listing agreement. 2001 and amendments thereto. MANAGEMENT DISCUSSION & ANALYSIS The Management Discussion and Analysis is attached and forms part of this Annual Report. the Company has submitted to the Bombay Stock Exchange Limited and the National Stock Exchange of India Limited. The abovesaid resolution was passed with the requisite majority. August 13. www. The financial results. COMPLIANCEWITH CAPITAL MARKET LAWS There has neither been any non-compliance on the part of the Company on any matter related to capital markets during the last three years. Charles Antony. IMPLEMENTATION OF NON-MANDATORY CORPORATE GOVERNANCE REQUIREMENTS The Company has implemented the non-mandatory corporate governance requirements prescribed under Clause 49 of the listing agreement with stock exchanges with respect to Remuneration Committee and Whistle Blower Policy.e. quarterly compliance reports signed by the Compliance Officer of the Company. 2009 at 1500 hours at Kamalnarayan Bajaj Hall & Art Gallery.

gov. Listing on Stock Exchanges The Company's equity shares are listed on the following exchanges: 1 Bombay Stock Exchange Limited (BSE) P.10 29.400 051.52 21.65 NSE Low 27. 'G' Block.55 24.88 19. second (half yearly) and third quarters are generally published in July.10 21. during each month in the last financial year.10 21.45 24. Plot No.55 30. The same are also uploaded on the website of the Securities & Exchange Board of India viz. www.60 20 . 2 National Stock Exchange of India Limited (NSE) Exchange Plaza.05 21.65 22.60 30.25 28. Annual audited financial results are generally published in May/June.75 22.40 26.50 21.15 29.10 22.50 High 37.400 023. th The Company has paid annual listing fees to both the stock exchanges within the stipulated time.40 25.45 31.55 19.The financial results for first.in via the Electronic Data Information Filing and Retrieval System and are available for public viewing via the link “EDIFAR” appearing on the home page of the said website.40 31.50 21. financial year. 2009 (both days inclusive) for the purposes of the Fourteenth Annual General Meeting.45 25.75 20. Stock Code The stock codes of the Company's equity shares on the BSE & NSE are as follows: BSE NSE 532371 TTML Market Price Data The High & Low on closing price.00 37. J.75 13.15 22.25 28.80 23.75 20.90 19.60 24.45 24. The financial results are uploaded on the Company's website and can be accessed by choosing the link “TTML” under the “About Us” link on the home page of the website.80 23.50 21.00 37. of the Company's shares are as follows: (Amount in Rupees) Month April 2008 May 2008 June 2008 July 2008 August 2008 September 2008 October 2008 November 2008 December 2008 January 2009 February 2009 March 2009 High 37.65 22.75 22.65 12.14 Annual Report 2008-2009 FinancialYear The Company follows the April .05 21.70 13.Towers Dalal Street Mumbai .40 26. Bandra-Kurla Complex. C/1. Bandra (E).March. 5th floor.45 BSE Low 27. August 13.55 19. Mumbai .60 12. The Foreign Currency Convertible Bonds (FCCBs) issued by the Company in June 2004 are listed on the Singapore Stock Exchange (SGX). August 3. October and January respectively. Date of Book Closure The share transfer books & the Members' register will be closed between Monday.sebi. 2009 to Thursday.

69 Promoters & Promoter Group Companies Foreign Investors (FIIs / NRIs / OCBs / Foreign Banks / Foreign Corporate Bodies) Financial Institutions / Banks / Mutual Funds Corporate Bodies Individuals TOTAL 77.40 5.00 21 . Near Famous Studio.00 2.31 2.80 (19.26) The Company has appointed TSR Darashaw Limited (formerly Tata Share Registry Limited) as its Registrar & Share Transfer Agents.com ShareTransfer System All physical share transfers are handled by TSR Darashaw Limited (TSR).62 9.55 3.) Company’s Share Price v/s NSE Company’s Share Price (Rs.739. Mahalaxmi. Mumbai .30 22. 2009 Change (%) Registrar and ShareTransfer Agents 28. Tel.50 (37.95 (36.56 0.77 2. The transferee is required to furnish the transfer deed duly completed in all respects together with the share certificates to TSR at the above said address in order to enable TSR to process the transfer.: 91 22 6656 8484 Fax: 91 22 6656 8496 E-mail: csg-unit@tsrdarashaw. Haji Moosa Patrawala Industrial Estate. 2009 with respect to categories of investors was as follows: Category of Investors Percentage of Shareholding As on March 31. Moses Road.400 011.76 0.626.) BSE Sensex 15. As regards transfers of dematerialized shares.708.26) As on April 1.85 (19.tsrdarashaw. the same can be effected through the demat accounts of the transferor/s and transferee/s maintained with recognized Depository Participants. Distribution of Shareholding The broad shareholding distribution of the Company as on March 31. 2008 65.87) NIFTY 4.com Website: www.020.46 100. 2008 As on March 31. Dr.Performance of the Company's Share Price in comparison to BSE and NSE Indices The performance of Company’s Share Price vis-à-vis the broad based BSE and NSE Indices during the financial year 200809 is as under: Particulars Company’s Share Price v/s BSE Company’s Share Price (Rs. 2009 As on March 31. E.86) 28.18 19. 20.68 23.45 22.19 100. Shareholders are advised to approach TSR Darashaw Limited on the following address for any shares & demat related queries and problems: TSR Darashaw Limited 6-10.

Pune.74 0. etc. Please refer Annexure II of the Report of the Board of Directors for further details regarding the Employee Stock Options. Panjim. 24. 99.148 towns in the States of Maharashtra and Goa through its telephone exchanges located at Turbhe (Navi Mumbai). of Shareholders 76. Marol (Mumbai). 2009. Address for correspondence Shareholders are requested to direct all equity share related correspondence /queries to TSR Darashaw Limited and only the non-share related correspondence and complaints regarding TSR Darashaw Limited should be addressed to the Compliance Officer at the registered office of the Company.26. 2009.06.10 per share.85 0.00 The Company had a total of 6. Nasik. GDRs.These options are convertible into equity shares of the Company on payment by the option holders of the stipulated conversion price of Rs.63 2. 24. Statutory Auditors on compliance with the Corporate Governance requirements by the Company is annexed to the Directors' Report. US$ 2 million FCCBs were converted into 36.e.14 Annual Report 2008-2009 The broad shareholding distribution of the Company as on March 31.46 100.in via the Electronic Data Information Filing and Retrieval System and are available for public viewing via the link “EDIFAR” appearing on the home page of the said website. Dematerialization of Shares & Liquidity As of March 31. Shareholders holding shares in electronic mode (dematerialized) should address all shares-related correspondence to their respective Depository Participants only. the Company issued Foreign Currency Convertible Bonds (FCCBs) aggregating US$ 125 million to foreign investors convertible at Rs.96 per share (including a premium of Rs. FCCBs with aggregate principal value of US$ 111. the conversion price was adjusted to Rs. 14. 22 . Andheri (Mumbai).18 100.241 million were outstanding as on March 31.89 1.sebi. In June 2004. and Kolhapur. Where we offer service The Company currently provides services in about 1.46 0. 2006. FCCBs with aggregate principal value of US$ 13. October 28. Post Rights Issue of equity shares of the Company. Outstanding Employee Stock Options.96 per share).f.82% of the total equity shares issued by the Company have been dematerialised. The Company has not issued any GDRs/ADRs/Warrants. ADRs.786 equity shares.93 83.05 3.95 1. The equity shares of the Company are available for dematerialisation with both the depositories in India .gov.41 13. of Shares) 1 to 501 to 1001 to 2001 to 3001 to 4001 to 5001 to 10001 to Total 500 1000 2000 3000 4000 5000 10000 above % of Paid-up Capital 5. Auditors' Certificate The certificate dated May 11. The quarterly shareholding patterns filed with the stock exchanges are also uploaded on the website of the Company and website of the Securities & Exchange Board of India viz. During the year. 2009.711 shareholders as on March 31.95 1.81 0. Nagpur.The equity shares of the Company are under compulsory dematerialized form.759 million have been converted into equity shares of the Company.The Company has issued Employee Stock Options.33 5.49 per equity share w.62 0. www.National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL).74 0. 2009 with respect to size of holdings was as follows: th Range (No. 2009 issued by M/s Deloitte Haskins & Sells.00 % of Total No. Nariman Point (Mumbai).

fibre).This change has been challenged by many operators before the TDSAT.50 per minute for the period from April 1. a press release permitting the use of alternate wireless technologies by UAS Licensees. Regulatory Developments Details of major developments on the regulatory front are as under: · Access Deficit Charges The Telecom Regulatory Authority of India (TRAI) had abolished Access Deficit Charges (ADC). 2008 after which this component of ADC was also eliminated. BSNL challenged this ADC amendment before the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) for the financial years 2006-07. fixed to mobile. · Mobile Number Portability Mobile Number Portability (MNP) is a service that allows end-users of telecommunication services to retain their current mobile telephone number when the subscriber switches from one operator to another. in November 2007. DoT has divided the country into two MNP Service Zones and has signed licence agreements with two companies to set-up and operate MNP. and reforms in the regulatory set-up. Unified Access Service Licence (UASL) operators like the Company apart from fixed & mobile services can also provide internet. accepted TRAI's recommendations of March 2006. falling tariffs. 2007-08 and 2008-09. entry of new operators. 2008. there were more than 452 million telephone connections in the country of which 415 million were mobile connections. 2008 to September 30.e. · Telecommunication Interconnection Usage Charges Regulation. TDSAT dismissed a petition filed by Cellular Operators Association of India and other GSM Operators against the Government's decision to allow dual technology. Indian telecom companies have been expanding their network and increasing their coverage of areas in rural India. The tele-density which was less than 1 per hundred in 1984 is today over 38 per hundred (including rural tele-density of 13%). · Use of AlternateTechnology DoT had issued on October 19. ducts.e. cellular. UAS Licensees who were using CDMA Technology for wireless access are now permitted to use GSM technology and vice-versa. In August 2008. VSAT licences.The ADC component on the international incoming calls was fixed at a reduced rate of Rs. 2003 vide Telecommunication Interconnection Usage Charges (Tenth Amendment) Regulations. In India. Unrestricted competition is allowed in all the categories. Hon'ble Delhi High Court upheld the Government decision. On March 31.Telephone connections are to be expected to touch the 500 million mark by the year 2010. 2003 The TRAI amended Telecommunication Interconnection Usage Charges Regulation. India today has the second largest telecom network in the world after China. a levy paid by private telecom operators to Bharat Sanchar Nigam Limited (BSNL) for meeting the cost of unprofitable operations in rural areas with effect from April 1. MNP is expected to be launched in major cities by September 2009. TDSAT also directed the DoT to immediately review the subscriber base of BSNL & Mahanagar Telephone Nigam Limited (MTNL) in all the circles and withdraw the spectrum that is 23 .MANAGEMENT DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS INDUSTRY STRUCTURE AND DEVELOPMENTS The Indian Telecom Services Sector has witnessed tremendous growth in the recent past. Unified Access (basic + cellular) service.The TDSAT has dismissed all the appeals. According to DoT. licences for internet services. on Mobile Number Portability. 2009 which effective April 1. Now all domestic and international calls are free from the incidence of ADC. The Department of Telecommunications (DoT). including access licences i. internet telephony and broadband services under their UASL licence. and IP-1 registration for passive infrastructure (towers. 2009 reduced termination charge for all types of domestic calls viz fixed to fixed. Despite a steady fall in the Average Revenue Per User (ARPU) with ever declining tariffs (Indian telecommunication tariffs are the lowest in the world). As of May 2009. mobile to fixed and mobile to mobile to 20 paise per minute from 30 paise per minute. national long distance and international long distance. and increased termination charge for incoming international calls to 40 paise per minute from 30 paise per minute. 2009. primarily driven by intense competition. there are various kinds of telecom service licences. 2007. carrier licences i. basic/fixed service. 0. The growth rate in rural areas though not matching with urban areas is significant. Approximately 10-12 million mobile connections are being added every month.

after which they directed the Company in February 2005. in a recent judgment has held that TRAI recommendations were done in a non-transparent manner and has advised DoT to issue fresh guidelines after getting the committee report. The year witnessed the launch of new Value Added Services (VAS) under Brand Tata Indicom. (b) Guidelines for allocation of additional Spectrum Based on TRAI recommendations (which discriminate between GSM and CDMA operators by allotting spectrum in a 2:1 ratio based on unsubstantiated presumption that CDMA technology is significantly more spectrum efficient).The Company will also realign its focus on the wireline services along with the focus on the wireless offerings. The Memorandum also offers for bidding BWA spectrum for WiMax.1 GHz Third Generation (3G) Spectrum which is used by GSM operators for 3G Services like HSPA/WCDMA. 24 . and demanding technology neutrality.The Company proposes to launch exciting new services and features on its network in the near future. The Hon'ble Supreme Court has stayed such requirement to surrender the spectrum. as was done in the case of GSM operators. seeking release of the 3 and 4 CDMA carriers (within the contracted amount of 5+5 MHz) against its pending applications. DoT thereafter levied a penalty of Rs. the demand has been stayed.14 Annual Report 2008-2009 beyond the criteria laid down by the DoT. increasing substantially the subscriber number thresholds. if necessary. PTT enables subscribers to form groups and instantly connect with multiple persons across the country who require short bursts of information. the innovative Push-To-Talk (PTT) service on a non-chargeable basis. querying the pricing of spectrum beyond the contracted amount and recommending. and pending hearing. launched in November 2004. · th Spectrum (a) Allocation of 3G Spectrum DoT on December 12. OPPORTUNITIES ANDTHREATS The rapid pace of technological development in the telecom hardware and software sectors has made it possible for the Company to provide a variety of services to its subscribers in a spectrum-efficient and cost-efficient manner. · Push toTalk The Company. Information on important litigation concerning the Company is as under: · Spectrum The Company and Tata Teleservices Limited (TTSL) filed in December 2007. seeking upfront allotment of the contracted 5+5 MHz spectrum to CDMA operators. 3G spectrum auction was postponed twice by DoT. 50 crores on the Company in February 2006. which are expected to deliver a growing part of the Company's revenues in the years ahead. The year witnessed the introduction of some value added services. thus increasing productivity and efficiency while simultaneously reducing costs. Revenues from VAS are expected to bolster the Company's revenues significantly in the coming years. a petition before TDSAT: challenging allocation of spectrum beyond the contracted amount to GSM operators. While the Company would aggressively focus on data cards. without allocating spectrum against pending applications. rd th DoT assured TDSAT that spectrum would be allocated against the pending applications. as a part of its endeavour to achieve Customer Delight. 2008 released an Information Memorandum which interalia provides information on bidding by way of e-auction for 2. fixed wireless and mobile telecom services. this was challenged by the Company at the TDSAT. DoT has set up a committee to review allocation criteria. DoT issued fresh spectrum allocation guidelines in January 2008. to discontinue the service which was done. No time-line for conducting the process has been finalised. TDSAT. withdrawal of excess spectrum allocated to GSM operators. making it more difficult for established service providers to acquire more spectrum and improve their quality of service to subscribers. it will also refocus its attention on wireline services. DoT and TRAI sought some information. DoT enhanced substantially the subscriber number requirement in January 2008. after holding discussions with TRAI. Commencing January 2005. However.The petition is likely to be heard soon. for alleged violation of ISP license conditions. which was furnished.

Technological Risks Changes in technology may render the Company's current technologies obsolete or require it to make substantial capital investments for upgradation. 14 crores (i. new platforms and the proposed introduction of 3G services. equipment and networks or terminate or suspend the licenses. which has licences to provide telecom services in 20 circles across India. The telecommunications industry has seen rapid changes in technology. DoT has filed an appeal in the Hon'ble Supreme Court challenging the whole order while the Company and TTSL have filed an appeal seeking implementation of the order from the first demand for the year 1999-00. 2009. Due to reasons not in the control of any of the UASL operators. The national teledensity is around the 37% mark. which could allow the Company to provide all types of high speed communication and convergence services.TTSL also has been permitted by the DoT to use GSM Technology in 17 Circles. The Company expanded its network throughout the States of Maharashtra and Goa by covering 1. DoT on June 4. 7 crores each for Mumbai and Maharashtra circle) should not be recovered from the Company for the alleged failure. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE The Company is in the business of providing the entire range of telephony products in Mumbai Service Area and Maharashtra (including Goa) Service Area.148 towns by the end of the financial year 2008-09.The order would be effective from the date of filing of petitions in TDSAT. especially as regards allocation of spectrum and introduction of new services. RISKS AND CONCERNS As is the case with any infrastructure project. there is a vast market in our country waiting to be tapped and the Company will take all the necessary initiatives to become a major player in its chosen areas of operation. the first year norms could not be met by any of them. provide broad discretion to the Government to influence the conduct of the Company's businesses by giving it the right to modify. Despite various representations from the industry and the Company. had laid down the principle that revenues accruing from non-licensed activities should not attract licence fee and directed TRAI to prepare a list of items to be included and excluded from Adjusted Gross Revenue (AGR) which attracts licence fee. Key risks include: Regulatory Risks The Indian telecommunications industry is subject to extensive Government regulation. the terms and conditions of the licenses and take over the entire services. in the public interest or in the interest of national security or in the event of a national emergency. and has got allocation of GSM spectrum in 16 circles. Rs. the technology currently employed by it may become obsolete or subject to competition from new technologies in the future. the industry is being liberalised and the Company would endeavour to take advantage of the new opportunities afforded by regulatory changes. the Company was required to complete certain rollout obligations within 1 and 3 years from the effective date of its license(s). However. The matter was decided in 2007 by TDSAT.e. issued show cause notices to the Company and other operators alleging non-fulfillment of the stipulated rollout obligations at the end of the first year.148 towns as at March 31. raised by DoT in May 2003.The Company has expanded its coverage to 1. war or similar situation.The Company has received legal opinion that the demands are invalid under law. OUTLOOK The outlook for the Company appears bright on a long-term basis. The Company has replied to the notices.· Computation of Licence Fee TDSAT in its judgement of July 2006. Details of various products and services are provided in the Directors' Report. The Company will also benefit from its association with TTSL. at any time. the Company is exposed to a number of risks. The Company's licenses are for fixed periods and are renewable for additional terms at the discretion of the Government. Although the Company strives to keep its technology up to date in accordance with the latest international technological standards. The Company's telecommunications licenses. which based on TRAI recommendations identified various items to be excluded from AGR. 2007. why liquidated damages of Rs. if necessary or expedient. 25 . There can be no assurance that any of the Company's licenses will be renewed at all or renewed on the same or better terms. and considering the teledensity of other regions and countries in Asia. The coverage had to be certified by the Telecommunication Engineering Center (TEC). · Fulfillment of Roll-out Obligations As a UAS Licensee. The notices required the Company to explain to DoT. such as use of cross over technology.

The Company benefits from the goodwill associated with the Tata Indicom brand that Tata Sons Limited has permitted the Company to use for marketing its products and services. intelligent network platform etc. The initiatives undertaken by the Company have been described in the Directors’ Report. Although all the above positively impact the Company's performance. the Indian Generally Accepted Accounting Principles (Indian GAAP) and the Accounting Standards as prescribed by the Institute of Chartered Accountants of India. The offer of higher monetary compensation by other operators and other service sectors like retail and media have also increased the challenges of retention. Interconnection Risks For calls which originate or terminate outside the Company's network. INTERNAL CONTROL SYSTEMS ANDTHEIR ADEQUACY An Audit Committee of the Board of Directors has been constituted as per the provisions of Section 292A of the Companies Act. procurement) with TTSL.) and activities (e.14 Annual Report 2008-2009 Financing Risks The Company is a telecommunication service provider and requires significant funding on an ongoing basis for setting up and expanding telecom infrastructure including services to be offered using GSM technology. ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The financial statements have been prepared in accordance with the requirements of the Companies Act. interrupted or stopped leading to customer complaints. the Company will also bid for 3G license. If for any reason these interconnection arrangements are disrupted. or if grant of Point of Interconnections (PoIs) or their augmentation are delayed. In addition.g. The Board of Directors believes that it has been objective and prudent in making estimates and judgements relating to the financial statements and confirms that these financial statements are a true and fair presentation of the Company's operations and loss for the year. The operations of the Company are restricted to two telecom circles and thus it has some operational disadvantages vis-à-vis national operators. The Company's Central Services sharing arrangements with TTSL allow it to jointly negotiate with equipment suppliers and service providers and benefit from economies of scale.The Company had 1. The Internal Auditors’ Reports dealing with internal control systems are considered by the Audit Committee and appropriate actions are taken. Dependency on Tata Teleservices Limited The Company has closely aligned and integrated its business operations and strategies with those of TTSL and also shares certain infrastructure (e. th 26 . 1956 and Corporate Governance requirements specified by the stock exchanges. Besides. billing platform. Implementation of project would be materially affected if the company does not achieve financial closure for project cost in a timely manner. and their willingness to co-operate with the Company in interconnection arrangements. if the Company is viewed as a stand alone enterprise. 2009.726 employees on its rolls as on March 31.g. quality and maintenance of the competitors' networks. who can roam in the Service Areas where the TTSL network is operational and vice versa. which conducts reviews and evaluation and presents its reports to the Audit Committee and the management at regular intervals. Increase in choices mean more effort and higher decibel volumes in acquiring and retaining subscribers which in turn makes it imperative to retain valuable and skilled intellectual capital. To match the competitors. this inter-dependency may be perceived to be an area of concern. one or more of the Company's services may be delayed. the Company offers roaming services to its CDMA mobile subscribers. the Company has to provide subsidy on handsets sold by its distributors to prospective customers. wherever necessary. Half of the project cost is funded by way of debt that is subject to a number of terms and conditions including periodic review of the business plan. 1956. Competition Risks The Indian telecommunications industry has recently witnessed intense competition with the entry of 4-5 new operators leading to further fall in tariffs. its ability to provide telecommunications services is dependent on access to and the development. DEVELOPMENTS ON HUMAN RESOURCES FRONT The entry of new service providers has substantially increased competition in the market. dissatisfaction and churn. The internal audit function is looked after by an independent firm.

Taxation. 92. Earnings Before Interest.485.00 807.941.095.18 crores primarily due to increase in revenues by 15% and increase in subscribers by 48%. and Amortisation (EBITDA) During the year. Depreciation. 82.19 crores). 593.00 1.55 crores to Rs.00) Expenses The major expenses as a percentage of total cost is as follows: Expenses as a percentage of total cost Interest 14% Depreciation 20% Interconnect and other access costs 22% Network Cost 16% Marketing and Business Promotion Expenses 13% Administration and other Expenses 10% Employees Cost 5% 27 .41 crores). This revenue growth was largely driven by the 48% increase in the number of subscribers to 74 lakhs at the end of March 2009 (compared to 50.19 1.98 1.941.71 - 2004-05 2005-06 2006-07 2007-08 2008-09 (66.00 1.000. revenues from telecommunication services increased to Rs. 1.13 1.12) (200.18 485.707. which includes subsidies received from the Universal Service Obligation Fund towards provision of Rural Household Direct Exchange lines (RDELs) in specified Short Distance Charging Areas (SDCAs) amounting to Rs.00 2004-05 2005-06 2006-07 2007-08 2008-09 Other Income Other income increased to Rs. EBITDA (in crores) 600.60 200.81 crores). postpaid and fixed line segments have been reduced to match reductions undertaken by competitors.00 302. 1. The tariffs of prepaid.94 crores (previous year Rs. 56.55 400.68 crores (previous year Rs. 112.The revenue growth is based on the growth in subscriber base.79 lakhs subscriber lines as at the end of March 2008). amidst falling tariffs.00 593.47 1.28 crores (previous year Rs.68 500.00 124. EBIDTA increased by 22% from Rs.KEY FINANCIAL INFORMATION & OPERATIONAL PERFORMANCE Revenues from Telecommunication Services During the year. Revenue (in crores) 2.000.500.406.707.

Rs. 19. and it is not uncommon for large greenfield infrastructure telecom projects to incur losses during the initial few years of project implementation.63 crores (previous year Rs. employees in the General Manager cadre and above. 2.13 crores to Rs. Network Interface Unit (NIU) decapitalisation .14 Annual Report 2008-2009 Net Loss The Company's net loss increased to Rs. 4.552. 368.91 crores) to Rs.71 crores).92 crores (Net of Passive Infra Hive Off . In addition. AS-11 transitional adjustment . May 11. of which during the current year. the Company has written off assets aggregating to Rs. 392. 355.58 crores. 125 crores).Rs.94 crores) and held for sale at the estimated realizable value of Rs. Dr.18 crores.30 crores. 752. and the Company Secretary as on March 31.Rs. Fixed Assets The Company continues to grow its network in Mumbai and other cities in Maharashtra and Goa. Both these codes are available on the Company’s website. I confirm that the Company has in respect of the financial year ended March 31.08 crores. the Company has adopted a Code of Conduct for its Non-Executive Directors. 1. 218. 27. 2009. 2. 2009 28 .20 crores being not realizable.Year-end Capital Work-in-Progress is at Rs. The year-end Net Block has increased from Rs.899.524. a declaration of compliance with the Code of Conduct as applicable to them. During the previous year. 4. th DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITHTHE COMPANY’S CODE OF CONDUCT This is to confirm that the Company has adopted a Code of Conduct for its employees including the Managing Director.66 crores).The major increase in the Gross Block was on account of expansion of the CDMA network by installation of switches.87 crores and other deletions . For the purpose of this declaration. 596.Rs. 125. 2009.861. cell sites and backbone amounting to Rs.60 crores for the year (previous year Rs. received from the Senior Management Team of the Company and the Members of the Board. The Company launched its full mobility services only in second half of 2003-04. 2. 159. The year-end Gross Block increased by Rs. TDMA assets were retired and removed from Gross Block (Rs.37 crores.07 crores (previous year Rs. Senior Management Team means the Chief Financial Officer. The Gross Block also includes the cost of GSM license fee (Rs. Mukund Rajan Managing Director Mumbai.74 crores). 3.

annexed thereto. proper books of account as required by law have been kept by the Company so far as appears from our examination of the books. An audit includes examining. 1956. 2. 1956. Dated: May 11. 2009 and taken on record by the Board of Directors. Our responsibility is to express an opinion on these financial statements based on our audit. The Balance sheet. we report that none of the directors is disqualified as on March 31. and according to the explanations given to us. and in case of the Cash Flow Statement. 2009 from being appointed as a director in terms of clause (g) of sub. of the loss for the year ended on that date. In our opinion. in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: i) ii) iii) in case of the Balance sheet.These financial statements are the responsibility of the Company's management. As required by Companies (Auditor's Report) Order. Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act. f) For Deloitte Haskins & Sells Chartered Accountants A B Jani Partner Membership No. 2003 issued by the Central Government in terms of sub-section (4A) of section 227 of the Companies Act. as well as evaluating the overall financial statement presentation.We believe that our audit provides a reasonable basis for our opinion. we report that: a) b) c) d) e) We have obtained all the information and explanations. the said accounts read with the Significant Accounting Policies and notes thereon. on a test basis. 46488 Mumbai. 1956. Further to our comments in the Annexure referred to above. give the information required by the Companies Act. of the state of affairs of the Company as at March31. We conducted our audit in accordance with the auditing standards generally accepted in India. in case of the Profit and Loss Account. evidence supporting the amounts and disclosures in the financial statements.AUDITORS’ REPORT TO THE MEMBERS OF TATA TELESERVICES (MAHARASHTRA) LIMITED 1. 4. a statement on the matters specified in paragraphs 4 and 5 of the said Order. Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account. which to the best of our knowledge and belief were necessary for the purposes of our audit. we enclose in the Annexure.section (1) of section 274 of the Companies Act. In our opinion. 2009 29 . An audit also includes assessing the accounting principles used and significant estimates made by management. On the basis of written representations received from the directors as on March 31. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. 3. We have audited the attached Balance sheet of Tata Teleservices (Maharashtra) Limited as at 31st March 2009. 1956. the Balance sheet. the Profit and Loss Account and the Cash Flow Statement for the year ended on that date. of the cash flows for the year ended on that date. In our opinion and to the best of our information. 2009.

The stocks of trading goods have been physically verified during the year by the management. The Company. we are of the opinion that the particulars of contracts/arrangements that are needed to be entered into the register maintained under section 301 of the Companies Act. the frequency of verification is reasonable. x) 30 . the Company has an internal audit system commensurate with the size of the Company and the nature of its business. Custom duty. Service tax. According to the information and explanations given to us. Sales-tax. The Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification. During the course of our audit we have not observed any continuing failure to correct major weaknesses in the internal control system. reasonable having regard to the prevailing market price/ similar transactions with other parties at the relevant time. a) According to the information and explanations given to us. viii) In our opinion. and according to the information and explanations given to us. 2003 are not applicable to the Company for the year. In respect of its fixed assets (a) (b) The Company has maintained proper records showing full particulars. In our opinion. secured or unsecured from companies. is reasonable having regard to the size of the Company and the nature of its assets. ix) We have broadly reviewed the books of account and records maintained by the Company relating to telecommunication activities pursuant to the order made by the Central Government for maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Act and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. prima facie. however. (c) iii) In respect of its inventories: (a) (b) (c) iv) The Company has not granted or taken any loans. in our opinion. during the year. we are of the opinion that the sale of the said fixed assets although substantial has not affected the going concern status of the Company (Refer note 25 of Schedule 17). All fixed assets have not been physically verified by the management during the year but there is a regular program of verification which. According to the information and explanations given to us. In our opinion.14 Annual Report 2008-2009 th ANNEXURE TO THE AUDITORS’ REPORT Re: Tata Teleservices (Maharashtra) Limited (Referred to in Paragraph 3 of our report of even date) i) ii) The nature of the Company's activities are such that clauses (xiii) and (xiv) of paragraph 4 of the Companies (Auditors’ Report) Order. 1956 and accordingly the sub-clauses (a) to (g) of clause (iii) of the Order are not applicable to the Company. Wealth tax. Income-tax. not made a detailed examination of the records with a view to determining whether they are accurate or complete. No material discrepancies were noticed on such verification. 5 lakhs in respect of any party. Employees' State Insurance. firms or other parties covered in the register maintained under Section 301 of the Companies Act. where such transactions are in excess of Rs. The procedures of physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. the transactions have been made at prices which are. including quantitative details and situation of fixed assets. v) vi) b) vii) The Company has not accepted any deposits from the public. According to information and explanations given to us in respect of statutory and other dues: (a) The Company has generally been regular in depositing undisputed statutory dues in respect of Provident Fund. 1956 have been so entered. there is an adequate internal control system commensurate with the size of the Company and nature of its business with regard to purchase of inventory and fixed assets and sale of goods and services. transferred certain fixed assets relating to its Passive infrastructure business. We have. cess and any other material statutory dues with the appropriate authorities during the year.

In our opinion and according to information and explanations given to us. The Company has not incurred cash losses during the financial year under audit and in the immediately preceding financial year. and according to the information and explanations given to us. the term loans availed by the Company were. 1998-99 Forum where dispute is pending Income Tax Apellate Tribunal The Income-tax Act.08 Period to which the amount relates A. xix) The Company has not raised any money by way of public issues during the year. funds raised on short term basis have. For Deloitte Haskins & Sells Chartered Accountants A B Jani Partner Membership No. 2009. prima facie.1.70 crores. 1961 Income tax demand xi) In our opinion. the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act. the Company has not defaulted in repayment of dues payable to a financial institutions and banks. xii) xiii) According to the information and explanations given to us. 2009 31 . at the end of the financial year are more than fifty percent of its net worth. no fraud on or by the Company was noticed or reported during the year. prima facie. 46488 Mumbai. xiv) According to the information and explanations given to us. on account of disputes are given below: Name of statute Nature of the dues Amount (Rs. are not prima facie prejudicial to the interests of the Company. debentures and other securities. which have not been deposited as at March 31. xvi) According to information and explanations given to us and on an overall examination of the balance sheet of the Company. the Company has not granted any loans or advances on the basis of security by way of pledge of shares. xv) According to the information and explanations given to us. xvii) According to information and explanations given to us. the accumulated losses of the Company. the terms and conditions of the guarantees given by the Company for loans taken by others from banks or financial institutions.Y. applied during the year for the purpose for which the loans were obtained.(b) According to information and explanation given to us details of disputed Sales tax / Income-tax / Customs duty / wealth tax / Service tax/ Excise Duty and Cess. Dated: May 11. 1956. other than temporary deployment pending application. been used for long term investment to the extent of Rs. in Crores) 0. xviii) The Company has not issued any debentures during the year.909. xx) According to the information and explanations given to us.

08 218.480.61 36.899.46 201.60 As at March 31.19 583.15 6 75. 2009 Schedule SOURCES OF FUNDS Shareholders' Funds Share Capital Reserves and Surplus Loan Funds Secured Loans Unsecured Loans Total APPLICATION OF FUNDS Fixed Assets Gross Block (at cost) Less : Accumulated Depreciation Net Block Capital Work .893.096.861. 2009 Rs.653.78 2.13 1.096.99 455. in Crores As at March 31.63 1.15 981.19) 2.48 240.73 2.018.85) 2.91 33. in Crores th 1 2 1.117.58 2.64 1. Loans and Advances Cash and Bank Balances Sundry Debtors Inventories Loans and Advances Less : Current Liabilities and Provisions Current Liabilities Provisions Net Current Liabilities Profit and Loss Account Total 7 8 9 10 27.848.B.Jani Partner For and on behalf of the Board Kishor A.036.986.48 2.098.29 5.670.00 4.626.07 3.91 570.469. 2008 Rs.55 2.663.592.076. Joshi (Chief Legal Officer and Company Secretary) Place: Mumbai Date: May 11.16 3.35 2.00 2.552.13 981.015.14 Annual Report 2008-2009 BALANCE SHEET AS AT MARCH 31.32 (448. 2009 Place: Mumbai Date: May 11.87 5.71 1.73 2.Progress 5 4.524.In . Chaukar (Chairman) S.32 5.09 528.09 1.112.60 3 4 Investments Current Assets.13 34.592.22 216.00 (559. 2009 32 .68 5.71 1. Mukund Rajan (Managing Director) Madhav J.897.56 576.01 299.13 125.17 2.64 11 12 Significant Accounting Policies and Notes to Financial Statements 17 As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A.16 2. Venkatesan (Chief Financial Officer) Dr.

Mukund Rajan (Managing Director) Madhav J.460.74) (2.81) 0.84) (0.19 82.32) (18.79 (158.B.Basic (Rs.941.Fringe Benefits Tax Loss after tax 13 14 2008-09 Rs.01 439. 2009 Schedule Income Telecommunication Services Other Income Total Expenditure Operation and Other Expenses Profit before Finance and Treasury charges.39) 1. Joshi (Chief Legal Officer and Company Secretary) Place: Mumbai Date: May 11. Depreciation and Tax Finance and Treasury Charges (Net) Depreciation /Amortisation.707.544.60) (2.Diluted (Rs. Venkatesan (Chief Financial Officer) Dr.PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31.00 10.304.76) (2.78 446.93 (125.58) (2. in Crores 1.789.58) (2.) ( Refer Note 17 of Schedule 17) Par Value (Rs.32) (0.Jani Partner 10.544. 2009 Place: Mumbai Date: May 11.053.670.) Significant Accounting Policies and Notes to Financial Statements 17 As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A.670.) Earnings Per Share .08) (2.689. 2009 33 .05 485.00 For and on behalf of the Board Kishor A. in Crores 1.68) (0.35 (124.41 1.21 (159.28 2.68) (0.848.70) 16 Balance brought forward Add: Adjustment on account of notification on transitional provision of Accounting Standard 11 (Refer Note 27 of Schedule 17) Balance carried to Balance Sheet Earnings Per Share .60 15 1. Chaukar (Chairman) S.68 112. (Refer Note c of Schedule 5) Loss before tax Provision for Tax .96 2007-08 Rs.18 304.84) 1.55 171.78 593.

259.02 2.897.893.897.000 Equity Shares of Rs. in Crores th 2.each fully paid-up 1. in Crores SCHEDULE .87 162.17 6.09 34 .57 2.00 2.22 350.500.00 1.718) Equity Shares of Rs.19 Notes: 1.626.each As at March 31. Of the above 1.56 Issued and Subscribed: 1.13 1.30 576.245.036. 2009 As at March 31.098.07 0.423.19 1.1 SHARE CAPITAL Authorised: 2.500.786 (Previous Year 84. Of the above 3. 2009 Rs. 2.636.17 SCHEDULE .99 583.00 2.56 1.68 47.504 (Previous year 1.16 413.048.10/.036. 2008 Rs.942) Equity Shares are issued during the year on conversion of Foreign Currency Convertible Bonds.563.10/.393 Equity Shares are held up by Tata Sons Limited (the ultimate Holding Company) and its Subsidiaries.500.3 SECURED LOANS From Banks (Refer note 1 below) Term Loans Cash Credit Accounts Acceptances Deferred payment credits (Refer note 2 below) 1.2 RESERVES AND SURPLUS Securities Premium account: Balance at the beginning of the year Add: On conversion of Foreign Currency Convertible Bonds Balance at the end of the year 576.897.14 Annual Report 2008-2009 SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31.190.87 564.500.000.95 2.098.01 2.500.90 110.00 2.12 0.893.893. SCHEDULE .

2005. 467. Subsequent to the rights issue of Equity Shares. . The holders of these Bonds have an option to convert the Bonds into Equity Shares of the Company on or after July 1.24.49 per Equity Share.by first pari pasu charge on the movable and/or immovable assets of the company.16 Note: During the year ended March 31. are redeemable at a premium of 19. . .by assignment of telecom license.Short Term Loans 1. 2.by assignment of the proceeds on sale of network in the event of cancellation of the telecom license.12 35 .4 UNSECURED LOANS Foreign Currency Convertible Bonds (FCCB) (Refer note below) From Banks . 2004 at a pre-determined price of Rs.00 1. . 2009 Notes : 1.by assignment of insurance policies.The Bonds that are not converted into Equity Shares.16 61.78 67.SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31. the conversion price has been adjusted to Rs. Loans from Banks are secured by either one or more of the following as per terms of the arrangements with respective banks: .66 528. Secured by hypothecation of vehicles acquired out of the loans.38% at the end of 5 years from the date of issue.by hypothecation of present and future book debts and outstanding money receivable.96 per Equity Share.076. SCHEDULE .by pledge of shares of promoters.24. the Company issued FCCB of USD 125 millions at an interest rate of 1% per annum (payable semi-annually).009. .

04 0.58 1.82 0.26 14.63 1.11 1.91 24.07 9.81 1. (g) Remaining amortisation period for CDMA License fees 8.552.49 11.22 5.421.861.58 49.87 6.08 5.91 17.53 0.182.71 7.899.51 0.63 4.74 83. (Refer note 22 of Schedule 17) (e) Refer Note 25 of Schedule 17 pertaining to the transfer of the "Passive Infrastructure Business" to a wholly owned subsidiary.34 2.96 306.663.31 0.053.48 775.08 404.33 Crores) which has already been fully provided for.14 0.23 0.5 Rs.67 617.51 125.65 1.06 70.50 crores)] Assets under construction (Refer Note 23 of schedule 17) Notes: (a) The Company during the current year has written off obsolete capital inventory of the Gross Value of NIL (Previous Year Rs.51 20.244.34 5.29 26. Fixtures and Office Equipment Vehicles Intangible Assets 36 License Indefeasible Rights of Use ('IRU') Computer Software Previous year Capital Work-In-Progress: (Refer Note e below) Capital advances Capital Inventory [net of provision for obsolescence of Rs.13 0.48 13.01 121.28 1.48 1.82 25.00 5.41 19. 2008 March 31.37 13.01 2.596.86 8.426.42 4. 18.126.42 20.66 ( b.16 21.84 1.18 447.00 2.653.35 2.14 1.97 0. .73 1.38 0.33 68. (f) Adjustments in Gross Block and depreciation pertain to adjustment on account of notification on transitional provision of Accounting Standard 11 (Refer Note 27 of Schedule 17) .87 19.67 89.73 7. 1. 2009 tions ments (Refer Note f) April 1.SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31.75 3.97 5.826.10 453.73 279.46 1.95 48. 16.71 726.294. Tangible Assets 6.5 years (Previous Year 9.11 crores (previous year Rs.23 63.28 Crores on account of write back of provision for Obsolescence on Capital Inventory put to use) (d) Deletion of Plant and Machinery includes assets aggregating to Rs.524.21 61.49 445.21 62.15 752.85 6.088.58 Crores (Gross Block) [Previous Year NIL] written off.73 925. (b) Deletion for Plant and Machinery includes assets aggregating to NIL [Previous Year Rs.79 645.78 0.13 Leasehold assets 14 Annual Report 2008-2009 Land Office premises Buildings Plant and Machinery Furniture.63 454. (Depreciation for previous year excludes Rs.71 4.55 1.08 1. 368.93 2.61 Crores on account of related provision for obsolescence on capital inventory.10 610.59 1.52 1. 8. 29.30 0.07 727.11 0. d and e) 3. March 31.52 (g) 925.77 618.63 12. 2008 As at 2008 March 31.11 1.74 1.15 0.94 Crores (Gross Block) retired from active use and awaiting disposal(Refer Note 21 of schedule 17)] (c) Depreciation in the Profit and Loss Account for the year includes amounts aggregating to Rs.81 3.663.86 13.94 4.5 years ) (Also refer Note 23 of Schedule 17) .58 28.90 0.524.74 0.06 1.38 0.43 22.73 218. 2009 th SCHEDULE . in Crores GROSS BLOCK DEPRECIATION NET BLOCK FIXED ASSETS PARTICULARS Notes As at AdjustAddiDeletions As at Upto AdjustFor the Deletions Upto As at 2009 2009 year ments (Refer Note f) April 1.15 53. March 31.

SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31. 2009 As at March 31.01 2.06 27.02 0.000.8 SUNDRY DEBTORS (Unsecured) Outstanding for a period exceeding six months Others Less: Provision Note: Considered good Considered Doubtful SCHEDULE .7 CASH AND BANK BALANCES Cash on hand Balance with Scheduled Banks in .00 75.6 INVESTMENT (Refer Note 25 of Schedule 17) Long.00 - SCHEDULE .52 441.45 225. in Crores SCHEDULE .01 34.73 260.42 0.01 2.term Investment (Unquoted) (at cost) Non .50 2.Term Deposit Accounts 0.Cash Credit Accounts (Refer Note 1 of Schedule 3) .98 240.22 2.40 0.84 256.48 240.03 27. in Crores 75.84 240.12 501.Trade: In Subsidiary Company: 75.22 37 .48 201.50 201. 2009 Rs.Current Accounts .48 34.46 SCHEDULE . 2008 Rs.000 Equity Shares (Previous Year NIL) of 21st Century Infra Tele Limitied of Rs 10/.9 INVENTORY Traded Goods Starter Kits 276.73 240.57 260.each fully paid-up As at March 31.46 185.

27 14.91 299.55 0.29 219. in Crores th 250.14 Annual Report 2008-2009 SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31. 0.62 299.99 302.74 5.73 73.66 4.09 Note: Provision for contingencies relate to certain claims by vendors on the Company made in earlier years and there is no movement in the same during the year.68 791.40 847.25 981.62 216.52 981.97 55.61 2.10 LOANS AND ADVANCES (Unsecured) Advances recoverable in cash or in kind or for value to be received [Includes Rs 0.56 4.67 70.33 711.15 36.99 844.91 2.99 2.0.53 2.61 52.89 0.18 Crores (Previous year Rs.59 194.42 2. 2009 As at March 31.10.74 3. Maximum amount outstanding at any time during the year is Rs.05 33. 2009 Rs.62 Crores) SCHEDULE .12 Provisions For Contingencies For Retirement benefits For Premium on Redemption of FCCB For Fringe Benefits Tax (net of advances) 16.30 3.99 216.50 11. 2008 Rs.71 7.18 Crores) due from an officer of the Company. 0.91 Note: Other Liabilites include temporary overdrawn bank balances aggregating to Rs.11 Current Liabilities Sundry Creditors (Refer Note 24 of Schedule 17) Total Outstanding dues of Micro Enterprises and Small Enterprises Total Outstanding dues of Creditors other than Micro Enterprises and Small Enterprises: . in Crores SCHEDULE .62 19.62 136.18 Crores (Previous year Rs.24 0.71 16.Others Deposits from Customers and others Interest accrued but not due on loans Other liabilities As at March 31.18 Crores)] Premises and other deposits Advances to Subsidiary Assets retired from active use awaiting Disposal (Refer Note 21 of Schedule 17) Advance Tax paid (Tax Deducted at Source) Less : Provision Note : Considered good Considered doubtful SCHEDULE .Under Usance Letter of Credit .74 Crores (Previous year Rs.60 34.01 59.06 13. 38 .11.

45 Crores)] Power Rent Rates and taxes Insurance Infrastructure Sharing Cost Miscellaneous Interconnection and Other access costs [including in respect of earlier years Rs.SCHEDULES FORMING PART OF PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31.88 153.94 474.78 17.28 56.26 6.64 156.68 1.95 48.87 29.06 39.941.81 12.4.98 Crores (Previous year Nil)] Payments to and Provisions for Employees Salaries and Bonus [Net of excess provision for earlier year written back Rs.82 9.510.90 83.80 Crores] Contribution to Provident and other Funds Staff Welfare 171.79 1.87 287.07 2.74 93.41 SCHEDULE . in Crores SCHEDULE .Plant and Machinery [including capital inventory consumed Rs 15.40 1.01 1.60 112.91 4. 5.13 TELECOMMUNICATION SERVICES Telephony Internet Services Interconnection Usage Charges [including in respect of earlier years Rs.22 10.21 363.14 OTHER INCOME Subsidies from Department of Telecommunications (DoT) (Refer Note 26 of schedule 17) Excess provision / Sundry credit balances in respect of earlier years written back Infrastructure Sharing Profit on transfer of the "Passive Infrastructure Business" to wholly owned subsidiary (Refer Note 25 of schedule 17) Gain on Fixed assets sold/written off (Net) Sale of Refurbished Network Interface Unit's Miscellaneous Receipts 92.28 0.62 8.707.679.5.22 8.78 1.02 40.34 59.71 Crores (Previous Year Rs.60 52.78 82. 2009 2008-09 Rs. in Crores 2007-08 Rs.91 5.91 3.21 4.50 58.83 0.15 OPERATION AND OTHER EXPENSES Network Operation costs Revenue Share to DoT Repairs and Maintenance .10 1.98 436.87 112.27 14.19 SCHEDULE .68 5.46 Crores (Previous year Nil)] Sale of Traded Goods 1.81 194.14 18.94 8.98 4.04 13.63 39 .93 9.57 98.5.

04 55.36 297.97 97.50 4.64 Crores (Previous year Rs.63 9.15 2.43 105.75 0. in Crores 2007-08 Rs.26 211.63 304.98) 180.22 9.74 99.others Travel and conveyance expenses Collection / Credit verification charges Customer service and call centre cost Assets awaiting disposal written off (Refer Note 21 of Schedule 17) Loss on Fixed assets sold/written off/retired from active use (Net) Provision for Doubtful debts (Net of insurance received amounting to Rs.20 0.56 1.63 172.304.7. 2009 2008-09 Rs.87 1.94 6.10. bill discounting and bank charges Foreign exchange fluctuations (Net) Less: Interest Capitalized (Refer Note 23 of schedule17) Less: Interest Income on Term Deposits with Banks Profit on redemption of units (Current Investment) 274.16 FINANCE AND TREASURY CHARGES (NET) Interest On Fixed Term Loans Others Expenses for loan arrangement.Starter Kits Opening Stock Add: Purchases Less: Closing stock 14.15 64.74 Crores) incentive received) Sales Commission and Expenses Traded Goods .05 18.14 Annual Report 2008-2009 SCHEDULES FORMING PART OF PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31.43 61.29 1.07 14.12 5.4.34 16.69 (9.72 Crores)) Insurance Expenses Miscellaneous expenses Contractual and other claims and liabilities (Net) Marketing and business promotion expenses Advertisement and business promotion expenses Hand set Subsidy (Net of Rs.92 (0.460.99) 184. in Crores th Administrative and Other expenses Rent Rates and taxes Repairs and Maintenance .07 171.80 301.13 350.80 2.32 2.08 53.52 83.2.25 2.34 15.78 15.14 10.52 3.23 0.81 0.58 80.21 0.29 26.72 1.59 Crores (previous year Rs.66 13.63 131.36 36.11 1.25 2.44 45.01 9.78 166.05 SCHEDULE .22 7.03 304.24 18.48 12.22 7.92 8.01 40 .

Assets retired from active use and held for disposal are stated at lower of net book value or net realisable value. Cost includes all costs incurred to bring the assets to their working condition and location (Also refer note 27). The Company capitalises software and related implementation costs as intangible assets. The Company also holds the National Internet Service provider . License fees paid by the Company for acquiring licenses to operate telecommunication / internet telephony services are capitalised as intangible assets. Maharashtra and Goa Service Area. (c) Fixed Assets Fixed assets are stated at their historical cost of acquisition or construction. Differences between actual results and estimates are recognised in the periods in which the results are known / materialise. Assets acquired pursuant to an agreement for exchange of similar assets are recorded at the net book value of the assets given up.The Company has also been granted approval by Department of Telecommunications (DoT) for providing telecommunication services using Global System for Mobile Communications (GSM) technology under the aforesaid licenses. (b) Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting year. was incorporated on March 13. 1956 (the Act). and capital stores that are carried under Capital Work-In-Progress till such time as they are issued for new installation or replacement. less accumulated depreciation/amortisation. 41 . with an adjustment for any balancing receipt or payment of cash or any other form of consideration. field unit cards. (Refer note 21) Expenditure related to and incurred during the construction period of switches and cell sites are capitalised as part of the construction cost and allocated to the relevant fixed assets. The Company is licensed to provide basic and cellular telecommunication services. Significant Accounting Policies (a) Basis of preparation of financial statements The accounts have been prepared to comply in all material aspects with applicable accounting principles in India.Internet Telephony license. 1995. Capital inventory comprises switching equipment. Company background Tata Teleservices (Maharashtra) Limited (“the Company”). Indefeasible Rights to Use ('IRU') bandwidth capacities by the Company are capitalised as intangible assets. The Company presently holds two Unified Access (Basic and Cellular) Service Licenses. one for Mumbai Service Area and another for Maharashtra and Goa and provides telecommunication services using Code Division Multiple Access (CDMA) technology.The Company has already been allotted trial Spectrum by DoT for Mumbai. the Accounting Standards (AS) notified in the Companies (Accounting Standards) Rules 2006 and relevant provisions of the Companies Act. The Company is a subsidiary of Tata Sons Limited (the ultimate holding company) 2. where it is reasonably estimated that the software has an enduring useful life.SCHEDULES FORMING PART OF THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT SCHEDULE 17 SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO FINANCIAL STATEMENTS 1.

based on the following estimates of their useful economic lives: Useful Life (in years) Buildings 60 Plant and Machinery Network Equipment 12 Time Division Multiple Access (TDMA) Equipment (Refer note 21) 9 Outside Plant 18 Network Interface Units (Refer note 22 ) 5 Air. iv. Amortization on License fees is provided for uniformly over the original license period of 20 years from the date of commencement of operation. The Company provides for obsolescence of its slow moving capital inventory. (Refer note 23) Indefeasible Right to Use ('IRU') bandwidth capacities taken by the Company are amortised over a period of fifteen years based on a technical estimate of useful life of the assets or period of the agreement whichever is lower. Pursuant to the announcement on accounting for derivatives issued by the Institute of Chartered Accountants of India (ICAI).Conditioning Equipment 6 Generators 6 Electrical Equipments 6 Computers 3 Office Equipments 3 Computer Software 3 Furniture and Fittings 3 Vehicles 5 Leasehold land and premises are amortised uniformly over the period of lease. Since the Company has the intention of being in business for a period well beyond 10 years and the telecommunication business cannot be carried on without the Telecom license. by way of depreciation. the Company in accordance with the principle of prudence as enunciated in Accounting Standard 1 on 'Disclosure of Accounting Policies' provides for losses in respect of all outstanding derivative contracts at the Balance Sheet date by marking them to market. Gains/losses arising on settlement of foreign currency transactions or restatement of foreign currency denominated assets and liabilities (monetary items) are recognised in the profit and loss account. the premium or discount arising at the inception of the contract is amortised as expense or income over the life of the contract. at the rate of 33.14 Annual Report 2008-2009 d) Depreciation i) Fixed assets are depreciated on a straight line basis. of cost. Any gains arising on such mark to market are not recognized as income (refer note 16 (ii)). Foreign currency denominated assets and liabilities are reported as follows: a) b) Monetary items are translated into rupees at the exchange rates prevailing at the balance sheet date. Transactions in foreign currency are recorded at the original rates of exchange in force at the time transactions are effected. Non-Monetary items such as fixed assets are carried at their historical rupee values. the useful life of the asset will exceed the rebuttable presumption of 10 years under AS 26 on “Intangible Assets”. iii.33% p. In case of forward exchange covers.a. Depreciation on additions and deletions to assets during the year is charged to revenue pro rata to the period of their use. except for long term assets/liabilities which pertain to acquisition of fixed assets which are adjusted in the cost of fixed assets (Refer note 27). ii. th ii) iii) iv) v) vi) e) Foreign Currency transactions i. 42 .

except where the results are anti-dilutive. i) Borrowing costs Borrowing costs attributable to the acquisition of a qualifying asset. Lease payments under Operating Leases are recognized as expenses as incurred in accordance with the respective Lease Agreements. The amount charged to subscribers for specialised features which entitle them to access the network of the Company and where all other services and products are paid for separately. 43 . Revenue is recognised when it is earned and no significant uncertainty exists as to its ultimate realisation or collection.f) Employee benefits Retirement benefit costs are expensed to revenue as incurred. n) Finance andTreasury charges Net finance and treasury charges are disclosed in the financial statements. On conversion of the FCCBs to Equity Shares the redemption premium is reversed. Other borrowing costs are expensed as incurred. Contributions to the Provident and Superannuation Funds are made in accordance with the rules of the Funds. as defined in AS 16 on “Borrowing Costs”. are recognised as and when such features are activated. Diluted earnings per share is computed by dividing the net profit or loss for the year by the weighted average number of Equity shares outstanding during the year as adjusted for the effects of all dilutive potential equity shares. The Company participates in a group gratuity cum life assurance scheme administered by the Life Insurance Corporation (LIC). m) Foreign Currency Convertible Bonds (FCCBs) Expenses Premium payable on Redemption of FCCBs is fully provided for on issue of the FCCBs. j) Earnings per share The Company reports basic and diluted earnings per share in accordance with AS 20 on “Earnings Per Share”. Interest and other income earned from treasury operations are reduced from the costs of treasury operations. k) Operating Leases Assets taken on Lease under which all significant risks and rewards of ownership are effectively retained by the lessor are classified as Operating Leases. Basic earning per share is computed by dividing the net profit or loss for the year by the weighted average number of Equity shares outstanding during the year. Expenses on issue of FCCBs and on Rights issue of Equity Shares are written off to the Securities Premium Account in accordance with section 78 of the Act. (Refer note 26 below). Provision for the year in respect of gratuity is made on the basis of actuarial valuation as at the end of the year. Leave encashment is provided for on the basis of actuarial valuation as at the end of the year. g) Revenue recognition Revenue from telecommunication services is recognised as the service is performed on the basis of actual usage of the Company's network / in accordance with contractual obligations and is recorded net of service tax. investing and financing activities of the Company. h) Government Grants Subsidies granted by Government for providing telecom services in rural areas are recognized as income in accordance with the relevant terms and conditions of the scheme / agreement with DoT. The Securities Premium Account is applied in providing for premium on redemption in accordance with Section 78 of the Act. are capitalised as part of the cost of acquisition. l) Cash Flow Statement The Cash Flow statement is prepared by the indirect method set out in AS 3 on “Cash Flow Statements” and presents Cash flows by operating.

Demand notices have been received from BSNL. 2009 Rs. the higher of the asset's net selling price and value in use). has. 1961 and the Guidance Note on Accounting for Fringe Benefits Tax issued by the ICAI. exceeds its recoverable amount (i. As at March 31. Long term investments are carried at cost. 2006. Provision is made to recognise a decline other than temporary in the carrying amount of long term investments.76 97. the Company. Provision is made if it becomes probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability.108. Cost of Inventories comprises of all cost of purchases and other costs incurred in bringing the inventories to their present location and condition. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Counter guarantees given by the Company Contingent liabilities : (i) Claims against the company not acknowledged as debt Telecom Regulatory Matters (Refer notes below) Others Notes: Contingent liabilities in respect of Telecom Regulatory Matters include: a) The Company had received an Order from the Hon. p) Fringe BenefitsTax Fringe Benefits Tax (FBT) is recognized as per the provisions of the Income-tax Act. 80. q) Impairment of assets An asset is considered as impaired in accordance with AS 28 on “Impairment of Assets” when at the balance sheet date there are indications of impairment and the carrying amount of the asset. or where applicable the cash generating unit to which the asset belongs.49 Crores for the period 14th November 2004 upto 28th February. The balance amounts aggregating to Rs. Out of the above. 2006. to pay ADC aggregating to Rs. In Crores th 476.e. The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the profit and loss account.50 142. already provided for amounts aggregating to Rs.14 Annual Report 2008-2009 o) Inventories Inventories are valued at lower of cost and net realizable value. In assessing the value in use. In Crores 3. in earlier years.00 44 . 5. the estimated future cash flows expected from the continuing use of the asset and from its ultimate disposal are discounted to their present values using a predetermined discount rate. Contingent Liabilities and Contingent Assets” are disclosed by way of notes to accounts.74 720.33 As at March 31. 4. the date after which ADC is payable on Net Adjusted Gross Revenue Basis. 2005 upto February 28.28.14 Crores pertaining to ADC for the period from August 26. s) Contingent Liabilities Contingent Liabilities as defined in AS 29 on “Provision.35 Crores have been disclosed as Contingent Liability under 'Telecom Regulatory Matters' as the Company is of the view that these demands include amounts relating to 'wireline' services 405.00 180.44 83. r) Investments Current investments are carried at lower of cost and fair value. 2008 Rs. Cost of traded goods is determined on weighted average basis.03 760. Supreme Court dismissing the Company's petition regarding Access Deficit Charge (ADC) demanded by Bharat Sanchar Nigam Limited (BSNL) in respect of 'fixed wireless' services provided under the brand name “WALKY”.

2008 which was further increased to Rs. being a demand for spectrum charges for the period from April 1. 2008.50 Crores to the Company with interest of 17% p. The Company has represented to the Wireless Planning Commission (WPC) various items of differences mentioned in the demand orders. DoT appealed to the Hon'ble Supreme Court which without commenting on the merits of the counter-claim confirmed that TDSAT had jurisdiction and remanded the matter to TDSAT for fresh adjudication.05 0.844/-)] 45 . 2008 held that BSNL and the Company should exchange relevant information and reconcile the differences.22 Crores) The Company in 2002 had filed a petition before TDSAT claiming refund of Rs. in Crores 0. The Company during the year has made on account payment to BSNL of Rs.05 0.5 millions (Rs.The Company has filed a review petition in this regard and on the said basis. 18. 2008.and ADC for the period before 26th August.712 Crores calculated upto March 31.8 millions (Rs. 1998 to June 30. 2005 to February 29. vide its demand letters dated July 3.38 Crore. The Company has undertaken export obligation to the extent of USD 100. 35.351 Crores as interest till October 31. As regards other disputes and claims against the Company. b) The Company had received a demand letter dated March 17. DoT during the proceedings before TDSAT claimed from the Company Rs.TDSAT had no jurisdiction) and facts.24 Crores) for which the company has applied for exemption] to be fulfilled during a period of 8 years commencing from the 29th January 2003.) 2008-09 Rs. iv) 6.1.00 Crores vide letter dated February 28. certification work etc. 2009. which was disclosed as contingent liability as at March 31. 2008. for the period from October 1.18 0.The Company is hopeful of success in the matter. 64. 2005.69 Crores by DoT. 2009. 25 Crores paid in earlier years. Counter guarantees have been given by the Company in the ordinary course of business and no liability is expected to accrue in this respect. and dismissed the counterclaim based on a law point (i. 2002. vide letter dated September 24.08 The Company has imported certain capital equipment under “Export promotion of Capital Goods Scheme” of the Central Government at a concessional rate of Customs Duty. together with interest and penalties.The Company is expecting a revised order after the completion of the reconciliation and is hopeful of success in the matter. 2008. Payments to Auditors (excluding service tax) : i) ii) iii) iv) Audit fees Tax Audit fees Other matters (For Quarterly Audits.303 Crores towards loss of (opportunity to earn) license fee and Rs. The Company is awaiting the relevant information from BSNL. 2008 held that since the counter claim filed by DoT is in the nature of a recovery suit appropriate court fee needs to be affixed. appropriate competent professional advice is available to the Company based on which. if imposed. in Crores 0.41 Crores) [net of USD 65.50 Crores recovered by Department of Telecommunications (DoT) in 1999 alleging failure to sign basic services license agreement for Karnataka circle after accepting Letter of Intent (LoI). This demand was subsequently revised to Rs. the Company has fulfilled the export obligation to the extent of Rs. the actual date after which. Up-till the end of the year.303 Crores towards loss of (opportunity to earn) license fee and interest of Rs. ii) Disputed Tax demands in Appeals before relevant authorities: Income Tax iii) 0. 21.TDSAT allowed refund of Rs. Reconciliation of the differences is in progress with the WPC.e. 2008. 266. failing which the Company will be liable to pay the differential customs duty. Telecom Dispute and Settlement Appellate Tribunal (TDSAT) vide its order dated August 12. DoT has filed with TDSAT a counter-claim of Rs.(Previous year Rs.The Company is hopeful of success in the matter. as per the directions of the Department of Telecom. 2008 from DoT for Rs.2.015 Crores which includes Rs.30 Out of pocket expenses [Current year Rs.a. favorable outcomes are anticipated and no liability is expected to accrue to the Company. The matter has been adjourned for hearing on August 12.123/.08 0. 404. services provided under the brand name “WALKY” are to be considered as Wireless in Local Loop (Mobile) for the purposes of ADC.184.18 0. 262.8. The TDSAT vide its order dated September 18.53 Crores (previous year Rs.21 2007-08 Rs. which is in addition to Rs.50 Crores in relation to the above.

in the context of Accounting Standard 17 on “Segment reporting”. The position of the allotted warrants is as follows: As at March 31. in Crores Residential Flats for accommodation of employee Cell Sites and others (b) Future Minimum Lease Payments under Non-Cancellable Operating Lease : Due not later than one year Due later than one year and not later than five years 36.950 As at March 31. (a) Operating lease rent expenses for the year in respect of lease agreements entered from April 1. Other than 2. all allotted warrants vest at the rate of 25% on each successive anniversary of the grant date. in Crores 2.70 9. 10.per share.950 th Since the market value of the Company's shares on the grant dates did not exceed the exercise price of Rs.20 Crores warrants were issued to Hughes Tele. 2001. the Company established the Employee Stock Option Plan (ESOP) under which Equity Shares are reserved for issuance to eligible employees of the Company. no compensation expense has been recorded. The agreements are executed for a period ranging from 6 months to 15 years with a renewable clause and in many cases also provide for termination at will by either party giving a prior notice period ranging between 30 to 90 days. to be held by it on behalf of the Company for awarding eligible employees as and when advised by the Compensation Committee constituted for the purpose.050 24.27 0.60 0.14 Annual Report 2008-2009 7.3 2007-08 Rs.) 50. 2008 Rs. The period during which the vested warrants may be exercised expires after 10 years from the date of the vesting. in Crores 1. in Crores 0. are considered to constitute a single reportable segment.76 0. 10/. In terms of the plan.67 1. 2008 (Nos.550 7.com (India) Limited Employees Stock Option Trust.02 29. end of the year As at March 31.950 7. The disclosure as required under AS 15 regarding the Company's gratuity plan is as follows: Particulars Projected benefit obligation. 2009 (Nos.These. 8.79 (0. beginning of the year Service cost Interest cost Actuarial loss on obligation Benefits paid Projected benefit obligation. 2008-09 Rs. until fully vested. 2009 Rs.000 fully vested warrants allotted in an earlier year. 1.24 0.27 46 .21 (0.82 71.550 18. Each allotted warrant carries with it a right to purchase one Equity Share of the Company at a price of Rs.11) 3. In November 1999.86 123.15 0.60 0.40. The Company is engaged in providing Telecommunication services under Unified Access License.87 2.) Opening Balance Issued during the year Forfeited Exercised Lapsed Closing Balance 7.45) 2.99 As at March 31.10/-.80 0.

40 (0.88 % 97 03 100 % 94 06 100 47 . 2009 Rs. Expenditure in Foreign Currency (Payment basis) on account of : Interest Other 2008-09 Rs.00% 6. in Crores 7.38 0. 2008 Rs. since the Company estimates that there will be no taxable profits for the year.45) (0.Projected benefit obligation. in Crores 2. Deferred Tax charges / credits have not been recognized in view of the tax holiday enjoyed by the Company and on considerations of prudence as set out in AS 22 on “Accounting for Taxes on Income”. In Crores 21.27 1. In Crores 364. 2009 Rs. 12.22 As at March 31.29 4.21 1.39 2008-09 Rs.38 (0. in Crores 1. in Crores 15.11 0.99 2.77 1. end of the year Fair value of plan assets at the end of the year Net liability recognized in the Balance Sheet.50% 8.00% As at March 31.88 2007-08 Rs.99 14. Value of Capital Inventory consumed during the year : Indigenous Imported 2008-09 Rs. in Crores 4.11) 0. Value of imports on CIF basis in respect of : Capital Goods 13. As at March 31.38 0.41 15. in Crores 197. 2008 Rs.89 As at March 31. 2008 Rs. in Crores 21. in Crores 3.23) Fair Value of Plan Assets at the beginning of theyear Expected Return on Plan Assets Contributions Benefit Paid Actuarial Gain / (loss) on Plan Assets Fair Value of Plan Assets at the end of the year Total Actuarial Loss Recognized Actuarial Assumptions: Discount rate Rate of increase in compensation levels of covered employees Rate of Return on Plan Assets As at March 31.71 2007-08 Rs.47 0.16 0.00% 8. No provision for current income tax has been made in the accounts.41 21.34 0.75% 6.78) As at March 31. in Crores 1.45 2007-08 Rs.02) 1. 2009 Rs.01 2.00% 11.86 1.13 22. in Crores 8.77 (0.30 0.28 (0.

2009 : Sundry Debtors Sundry Creditors Loans and Advances 11) Investment in Subsidiary as at March 31. (formerlyE2E Serwiz Solutions Ltd.Administrative and Other Expenses .01 - 14 Annual Report 2008-2009 48 0.91 General Services Ltd.Network operation cost . Infra Tele Teleservices Ltd.63 1.Towards Recharge Coupon Vouchers . 2009 Particulars Insurance Insurance (formerly Co.20 4.60 0.60 17.16 - Since the figures are less than the denominations disclosed.45 0.Rent .10 11.02 0.10 7.02 0.Infrastructure Sharing Charges .06 21.Rent .Interest 2) Income : .07 0.48 - 1. Tata AIG Tata AIG Tata Sky Ltd.02 9 Internet Ltd. Space TV Ltd.13 12. th i) a) Details of transactions with Related Parties For year ended March 31. Tata Sons 21st Century Ltd.36 0.Interconnect and Access charges (Net) .14 26.70 17.70 6.00 1.24 26.97 47.61 - 1.77 1.07 l 0.) 10 0.Rendering Telecom Services .Advertisement and Business promotion expenses (Net) .18) (Rs.89 75. Support Services Consultancy Ltd.79 3.15 - 1) Expenses : .03 2.26 74.23 10.93 0.34 0.Customer Service and Call Centre Cost .11 0.15) Related Party disclosures (in terms of Accounting Standard . Ltd. Ltd.66 15. the figures donot appear Figures above are inclusive of Service Tax where ever applicable .20 0.19 17.Profit on transfer of Tower Business Hive-off 3) Reimbursement of Expenses 4) Investment in Subsidiary during the year 5) Purchase of Fixed Asset 6) Net Value on transfer of Tower Business Hive-off 7) Unsecured Loan repaid 8) Security Deposits taken 9) Unsecured Loan taken 10) Outstanding as at March 31. Services THDC Ltd.66 6.28 1.) 1 2 3 4 5 2. 2009 0.01 - 3.44 11. Ltd.41 0. in Crores) Holding Company Subsidiary Company Fellow Subsidiaries Tata Tata Tata Business Tata Life Co.73 0.88 0.99 293.Salary .55 0. 6 7 8 0.

07 4. Ltd. Computational Research Laboratories Ltd. Tata Infiniti E-NXT TCE Tata i) a) Details of transactions with Related Parties For year ended March 31.01 - 10.Salary .89 17. Pvt Ltd. Ltd. Tata Petrodyne Ltd. 2009 : Sundry Debtors Sundry Creditors Loans and Advances 11) Investment in Subsidiary as at March 31.03 0.02 0.Customer Service and Call Centre Cost .Infrastructure Sharing Charges .Network operation cost .00 The above includes Rs.23 0.00 0.00 20. Tata Trustee Company Private Ltd.68 11.Administrative and Other Expenses .45 1.99 47.Profit on transfer of Tower Business Hive-off 3) Reimbursement of Expenses 4) Investment in Subsidiary during the year 5) Purchase of Fixed Asset 6) Net Value on transfer of Tower Business Hive-off 7) Unsecured Loan repaid 8) Security Deposits taken 9) Unsecured Loan taken 10) Outstanding as at March 31.04 0. 2009 Particulars 11 12 13 14 15 16 17 18 0.Rent .26 - 1) Expenses : . in Crores) Key Management Personnel CMC Tata Asset Others Managing Director Total Management Securities Capital Ltd.12 32.Interconnect and Access charges (Net) .01 0.31 293.18) (Rs.99 0.Rent .Advertisement and Business promotion expenses (Net) .23 74. 0.44 0.04 0.00 5. Ltd. the figures donot appear Figures above are inclusive of Service Tax where ever applicable Others Include Tata Realty & Infrastructure Ltd.48 1.00 1.15) Related Party disclosures (in terms of Accounting Standard .33 0.01 - 0.14 17.91 75.23 20. Ltd.29 35.80 20. Ewart Investments Ltd. Charles Anthony (Ex Managing Director) towards performance pay for the financial year 2007-08 Since the figures are less than the denominations disclosed.77 1.98 26.Interest 2) Income : . .Towards Recharge Coupon Vouchers .10 36.54 0.41 - 19 1.42 0.20 0.73 20. 2009 0.97 20.19 0.41 0.20 49 (0.77 Crores given to Mr.Rendering Telecom Services .85 8. Engineers Retail Financials Consulting Ltd.67 13. Tata Investment Corporation Ltd.03 0.06) 0.

in Crores) Holding Company Fellow Subsidiaries Others Key Management Personnel th For the year ended March 31.64 Reimbursement of Expenses Outstanding as at March 31. Tata Asset Management Ltd.Advertisement and Business promotion expenses (Net) . Tata Realty & Infrastructure Ltd.13 - 0.08 37. Tata AIG Life Insurance Co. E-NXT Financials Pvt. Ltd. 2008 Tata Sons Tata Tata Ltd.Related Party disclosures (in terms of Accounting Standard .73 9. Tata Securities Ltd.96 - Tata Tata Business Support Consultancy Services Services Ltd.72 - 1.) CMC Ltd.Rent .00 - 26. .18) (Rs. Charles Dr.47 Expenses : .96 39.Miscellaneous Income .00 - 0.02 - - 2.13 0.40 0.03 0.63 6.Network operation cost .64 31. Ltd.99 9.02 Income : .51 6.) 4 5 9 0.45 9.09 0.54 0. TCE Consulting Engineers Ltd.73 0.Miscellaneous Expenses .97 16.43 12.30 26.75 22.Interest .48 38. (Formerly-E2E Serwiz Solutions Ltd.43 12.95 - 0. (formerly Space TV Ltd. Ltd.Customer Service & Call Centre Cost . Mukund Govind Antony Rajan Managing Managing Director Director Total 1 2 3 6 7 8 1. THDC Ltd.27 0.97 0. 2008 Sundry Debtors Sundry Creditors Other Receivables 0.91 5.05 0.Rendering Telecom Services 1. Tata Sky Ltd. Services Ltd.10 Others include Companies as below: Wireless TT Info Services Ltd. Infinity Retail Ltd.Salary .05 0.04 - 14 Annual Report 2008-2009 7. Tata AIG General Insurance Co.Towards Recharge Coupon Vouchers .26 6.97 16. Ltd.14 14.64 0.26 1.45 28. Tata Capital Ltd.60 1.77 21. Teleservices Internet Ltd.72 0.81 0.Purchase of Fixed Asset 50 0.02) 0.25 0.06 (0.

A.E. Ltd.31.A.F.12. Ltd.E. Ltd. Key Management Personnel (Managing Director) Dr Mukund Govind Rajan (from Feb 28.. Ltd. Ltd. Ltd.08) Gurgaon Construct Well Pvt.12.08) Gurgaon Realtech Ltd.12.) Tata Consultancy Services Asia Pacific Pte Ltd. (W.f. TRIF Hyderabad Projects Pvt.19. 26.09.F. TRIF Real Estate and Development Pvt.08) Infiniti Retail Limited (formerly Value Electronics Limited) Nova Integrated Systems Limited (W.E.F. Limited (W. Inc (w.E.08) TRIF Trivandrum Projects Pvt. Ltd. Ltd.e.F. Tata Consultancy Services Deutschland GmbH Tata Consultancy Services Do Brasil Ltda (Formerly Tata Consultancy Services Do Brasil S.A.12.08) Tata Consultancy Services Limited Tata Housing Development Company Limited (formerly THDC Limited) Tata International AG.12.30.F. Ltd..08) Tata Advanced Systems Limited (W.Tecknosoft (France) SAS) Tata Consultancy Services Japan Ltd.E.F.F.09) TRIF Constructions Pvt. Limited (W.12.E.(formerly Exegenix Canada Inc. WTI Advanced Technology Ltd.E.2008 ) Tata Consultancy Services Argentina S.F.08) Navinya Buildcon Pvt.09) Ahinsa Realtors Pvt. 15.29. Limited) TCS FNS Pty.12. Tata Consultancy Services De Mexico S.08) Tata Capital Housing Finance Limited (W.F.5.12.E.2008 ) TATASOLUTION CENTER S.F. 21. (W. 05.10.08) Tata Capital Pte.F.09.F.F.F. (w. 26.f.10. Ltd.18) ii) A B C 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 Details of all Related Parties and their relationships Holding Company Tata Sons Limited Subsidiary Companies 21st Century Infra Tele Limited (W.12. Tata Consultancy Services (Philippines) Inc. APONLINE Limited C-Edge Technologies Limited CMC Americas Inc CMC Limited Custodia De Documentos Interes Limitada Diligenta Limited Financial Network Services (Africa) (Pty) Ltd.E.Tecknosoft S.09. 15. Ltd.F. 12.E.) (W.30. Ltd.03.08) TRIF Gandhinagar Projects Pvt. Limited Tata Infotech Deutschland GmbH (Ceased to be a subsidiary w.2008 ) TCS Financial Management.31.12.F.08) Landscape Structures Pvt. 31.f.15) Related Party disclosures (in terms of Accounting Standard .08) Tata AG. TCS Solution Center S.f. (W.A. 17. Ardent Properties Pvt.2.A. (formerly TCS Argentina S.A.A. 2.f.09.E. 01.31. (W.F.) Limited Financial Network Services Malaysia Sdn Bhd (Under Voluntary Liquidation) MP Online Limited PT Financial Network Services PT Tata Consultancy Services Indonesia Syscrom S.A. Tata Consultancy Services (China) Co. Limited (W.F. Ltd. TRIF Amritsar Projects Private Limited ((W.E.08) Gurgaon Infratech Pvt.E. Pioneer Infratech Pvt. Ltd.09.F. De C. 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 D 1 2 TRIF Structures & Builders Pvt. (formerly Unitech Construct Well Pvt. (Formerly TKS . Limited TCS Iberoamerica SA TCS Inversiones Chile Limitada TCS Italia SRL TCS Management Pty Ltd.09.31.E.08) TRIF Property Development Pvt.2009 ) TCS e-Serve International Limited (Formerly CGSL International Limited)(w. Ltd. Ltd. Zug Tata Internet Services Limited Tata Investment Corporation Limited Tata Limited Tata Pension Management Ltd Tata Petrodyne Limited Tata Realty and Infrastructure Limited Tata Securities Limited Tata Sky Limited Tata Teleservices Limited Tata Trustee Company Pvt. Ltd.F. Ltd.08) TCE Consulting Engineers Limited Tce QSTP-LLC (W.08) Arrow Infra Estates Pvt. (formerly Unitech Infratech Pvt. TC Travel And Services Limited (W.12.09.04.12.E. TRIL Constructions Ltd. Tata Consultancy Services Luxembourg S.F.E. 2008) Charles Anthony (Upto Feb 29. LLC TCS Financial Solutions Australia Holdings Pty Limited (Formerly Financial Network Services (Holdings) Pty. Ltd.) (W.2008 ) Financial Network Services (H. 07.12.2008) Computational Research Laboratories Limited Concept Marketing and Advertising Limited e-Nxt Financials Limited Ewart Investment Private Limited Ewart Investments Limited Good Health TPA Services Limited (W. Limited) TCS Financial Solutions Australia Pty Limited (Formerly Financial Network Services Pty.E.K. TRIF Kolkata Projects Pvt.A. ) Tata Consultancy Services Chile S. Ltd.e.08) List of Fellow Subsidiaries Actve Digital Services Pvt Ltd (W.08) TRIF Erectors Pvt.A Tata Consultancy Services Malaysia Sdn Bhd Tata Consultancy Services Morocco SARL AU Tata Consultancy Services Netherlands BV Tata Consultancy Services Portugal Unipessoal Limitada Tata Consultancy Services Sverige AB Tata Consultancy Services Switzerland Ltd. TRIL Developers Ltd. Ltd.(formerly Unitech Real Tech Ltd.10.30.01.e. Tata Consultancy Services (Thailand) Limited (w.) Tata Consultancy Services France SAS (Formerly TKS .09.07. 2008) 51 . Ltd. 31.08) Tata Capital Limited (formerly Primal Investment and Finance Limited) Tata Capital Markets Limited Tata Capital Markets Pte.2008 ) TCS e-Serve Limited (Formerly Citigroup Global Services Limited) (w.19. (W.08) Panatone Finvest Limited Tara Aerospace Systems Limited (W.f. TRIL Airport Developers Ltd.F.07.E. Financial Network Services (Europe) plc (Ceased to be a subsidiary w.07.E.E.) Tata Information Technology (Shanghai) Company Limited Tata Infotech (Singapore) Pte. Ltd.2008 ) Tata Consultancy Services (South Africa) (PTY) Ltd.e. (W. Ltd. Tata America International Corporation Tata Consultancy Services (Africa) (PTY) Ltd.E. Ltd (W.F.F. Tata Consultancy Services De Espana S. (W.f.e.9.E. Ltd. Ltd. 26.18.30. (W.V. TRIF Infrastructure Pvt. TRIF Kochi Projects Pvt.09. 11.08) and Ceased to be a subsidiary w. Financial Network Services (Beijing) Co. 05.E.e.f. TRIF Realty Projects Pvt. TRIF Mega Projects Pvt. Ltd. Zug Tata AIG General Insurance Company Limited Tata AIG Life Insurance Company Limited Tata Asset Management (Mauritius) Pvt Limited Tata Asset Management Limited Tata Business Support Services Limited (formerly E2E SerWiz Solutions Limited) Tata Capital Advisors Pte.08) TRIF Modern Superstructures Pvt.e.) (W.F.E.E.e.08) TRIF Investment Management Limited Wireless TT Info Services Limited Acme Living Solutions Pvt. Tata Consultancy Services Belgium SA Tata Consultancy Services BPO Chile SA (Formerly Tata Consultancy Services Chile Limitada) Tata Consultancy Services Canada Inc. 19.10.A TCS e-Serve America. 22. 01.

86 th a) b) c) ii) iii) Forward Contracts Currency options for hedging of foreign currency exposure Total Interest Rate Swaps The mark to market loss of outstanding currency options and interest rate swaps as at the year-end aggregate to Rs.90 107.59 81.Super Inst.49 479. Growth 7701668 10 10 52 . Following units have been purchased and redeemed by the Company during the year ended March 31.81 80.) In calculating the earnings per share the effect of dilution on account of outstanding ESOPs and FCCBs is ignored since results are anti.100. Quantitative details of principal items of goods traded (Starter Kits): Quantity (Nos. of Units FaceValue (Rs.26 As at March 31. 2009: No. 2009 USD in Rs.91 March 31.866 10 (0.60 1.49 80.16 (7.897.17 Vendor payables 50. in Crores 2. 2008 USD in Rs.) 603678 (535597) 2935085 (2079026) 2864615 (2010945) 674148 (603678) Value Rs.90 26.90 25.28 407.34 100.984 10 (0.78 (13.2008 125.14 Annual Report 2008-2009 16.74 66. Derivatives i) Outstanding derivatives : As at Mar 31.22 (2.40) 2. in Millions Crores 26.60 327. 2009 159.84) (0.84) As at March 31. in Millions Crores FCCB (including redemption premium) 15. Nil (Previous year Rs. The foreign currency exposure that are not hedged by derivative instruments: As at Mar 31. in Millions Crores 94.87 103.dilutive.) Diluted Earnings per Share (Rs.Savings Plan Growth 20852562 10 37 ICICI Prudential Institutional Liquid Plan.20 401.22) a) b) c) d) Opening Stock Purchases Sales Closing Stock 19.22) 9.30 479.) Cost (Rs.43 336.28 94. 18.01 (2. in Crores) HDFC Cash Mgt Fund .62 256.70) 17 Earnings Per Share Data i) ii) iii) iv) v) Loss after Tax (Rs. Nominal Value of Equity Shares (Rs.848.93 March 31. 2008 USD in Rs. in Millions Crores 18.68) (0.74 1.80) 18.57 Crores).516. in Crores) Weighted average number of shares outstanding.) Basic Earnings per Share (Rs.13. 2009 USD in Rs.87 107.60 74.

in Crores 1. 2008 to transfer the same on a going concern basis to 21st Century. liabilities (specific) 53 . during the year.8. the Company has entered into a Business Transfer Agreement ('BTA') on September 30. the Company provides fixed wireless telephony services using the erstwhile Time Division Multiple Access (TDMA) technology to certain selected Village Public Telephone (VPT) customers only. the Company has acquired a wholly owned subsidiary viz. none of the creditors has confirmed that they are registered under the Micro. in Crores 0. The transfer includes transfer of assets (fixed and current).45. Since the erstwhile TDMA technology has become obsolete. Currently. Managerial Remuneration i) Managing Director 2008-09 Rs.1. aggregating Rs. Accordingly the said NIU's aggregating Rs.63 Crores (Previous Year Rs.368.77 Crores paid during the year for 2007-08 on account of bonus / performance pay 2007-08 figures include Rs.63 Crores) have been capitalized during the year in accordance with AS 16 on 'Borrowing Costs' and included under Capital Work in Progress.66 Crores have been capitalised as intangible assets. The Company commenced provision of mobile services using CDMA technology in the year 2003. Accordingly the said assets were retired from active use and transferred to 'Assets awaiting disposal'.0. Maharashtra and Goa Service Area.11 0.15 0. 2008-09 Rs. Small and Medium enterprises Development Act.392. The management. the Company will commence amortization of the license fees paid. in Crores 0.85 2007-08 Rs. 24. having regard to the present condition of the said NIUs. 2006.03 2007-08 Rs.0.45 Salaries Contribution to Provident and other Fund Monetary value of perquisites Total Note: a) b) c) ii) 2008-09 figures include Rs. 22.68 1.77 Crores (2007-08 includes Rs. The Company has already been allotted trial Spectrum by DoT for Mumbai Service Area . The Company.610.81 Crores (Net Block Nil)}.0.40 Crores) paid to previous Managing Director. which have been disconnected and are not in use (including not retrieved) and also have been fully depreciated in the books of account. have decided to write-off the same. 2. has been granted approval by DoT for providing telecommunication services using GSM technology under the terms of the existing Unified Access Services Licenses.75 Crores (Net block Rs.58 Crores (cost) have been written off during year and removed from the block of fixed assets. Consequent to the Shareholders approval on transfer of “Passive Tower Infrastructure Business” ('PI Business'). During the year.64 Crores) {including those lying in capital inventory aggregated to Rs.30 Crores in the previous year. 1. at an estimated realisable value of Rs.09 1. in Crores 1.03 Non-executive Directors Directors' Sitting Fees 21.4.The disclosure regarding dues to such creditors is given accordingly in Schedule 11. Managerial remuneration for 2008-09 includes Rs.20. on commencement of GSM operations and will amortise such fees over the remaining life of the respective license.20 Crores being not realizable. 21st Century Infra Tele Limited (21st Century). The borrowing costs attributable to the GSM operations aggregating Rs.13. 25. 23. The Company during the previous year.06 0. the Company has during the previous year decided to dispose off the fixed assets pertaining to TDMA technology except for those being utilized to service the aforesaid VPT Customers.57 Crores paid during the year for 2006-07 on account of bonus / performance pay. of which during the current year the Company has written off assets aggregating Rs.The amounts paid towards the related license fees aggregating Rs. has identified certain Network Interface Units (NIU's).21 0. As per information available with the Company. their future usability and the fact that these NIUs have been fully depreciated. In accordance with it's accounting policy.

Mukund Rajan (Managing Director) Madhav J.45 Crores. The Company is in advanced stages of financial closure for proposed GSM and other Network Roll out and would be able to meet its further funding requirements.392. The aforesaid option is effective with retrospective effect in respect of accounting periods commencing on or after December 7. the depreciation for the year is higher by Rs. The Company is consistently making cash profits.07 th Fixed assets (WDV) Capital Work in Progress Current assets Current liabilities Total Less: Sale Consideration Profit 26. "Other Income" for the year is higher by Rs. Signatures to Schedules '1' to '17' As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A.23 293. companies have been given an option to account for exchange differences arising on reporting of long-term foreign currency monetary items (assets/liabilities) in so far as they relate to acquisition of a depreciable capital asset.293.30 0.66 Crores as license fees for providing services using GSM technology under the existing licenses and expects to roll-out the related services during the next financial year.95 Crores. is not uncommon for telecommunication service providers in their initial years of commercial operations. Exchange loss relating to year ended March 31. Joshi (Chief Legal Officer & Company Secretary) 54 .91 11. 2009 adjusted against carrying value of fixed assets aggregating to Rs. The accumulated losses of the Company at the close of the year have exceeded its paid-up capital and reserves. to be added/deducted from the cost of the asset and for others to be accumulated in a separate reserve to be amortized over the balance life of the asset/liability but not beyond March 31. The Company has exercised this option and has given the following effect in the accounts for the aforesaid: a) b) Exchange gain (net of depreciation) relating to year ended March 31. 2008 (Rupees in Crores) 271. 2009 aggregates to Rs. The Central Government. The Company in the previous year had also paid Rs. 2008 adjusted in debit balance of Profit and Loss account and Plant and Machinery aggregating to Rs. vide notification dated March 31. This. however.17.81 Crores. whereby. 29. and "Loss after tax " is lower by the like amount. due to high operation costs of heavy infrastructure and high capital requirement for building the network. 29. Jani Partner For and on behalf of the Board Kishor A.03 (3. 27. Accordingly.88 Crores and the loss for the year is lower by Rs. 28. Chaukar (Chairman) S. Due to the aforesaid option exercised by the Company. the Company has decided to recognise the upfront (Universal Service Obligation) USO subsidy granted by Department of Telecommunication over the remaining validity period of the scheme/agreement as against the method of recognizing the said revenue over a period of 5 years from the date of receipt from DoT.73 13.57 Crores and the amount (after the aforesaid adjustments) of Plant and Machinery remaining to be amortised as at March 31. 2009 Dr. 2011. Based on the foregoing considerations. the Company is confident of it's ability to continue in business as a going concern and the accounts have accordingly been prepared on this basis. amended AS 11 on ´The Effect of Changes in Foreign Exchange Rates´. 2009. With effect from April 1. 2008. 48.The book value of the assets and liabilities transferred as at September 30. 49. 2009 Place : Mumbai Dated: May 11. Figures of the previous year are regrouped and reclassified wherever necessary to correspond to figures of the current year.14 Annual Report 2008-2009 related to the PI Business for a lump sum consideration of Rs.30 Crores. 2007.44) 293. 0. and has been able to grow its subscriber base and network. Venktesan (Chief Financial Officer) Place : Mumbai Dated: May 11.B. 2008 and the resulting profit are as follows: Particulars As at September 30.76 Crores. 18.

59) (213.07) (0.B.38) 414.24) 296.98) 34.88 (1.39) 446. 3.61 34.62 (49.03 (578. Venkatesan (Chief Financial Officer) Place: Mumbai Date: May 11. Sheet).Mukund Rajan (Managing Director) Madhav J.48 (6. Joshi (Chief Legal Officer and Company Secretary) Place: Mumbai Date: May 11.21 (75.CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31. 2009 55 .45 (39.07) (9.Jani Partner For and on behalf of the Board Kishor A.207.28 (57.00 (11.15) Operating profit before working capital changes (Increase) in Sundry Debtors (Increase) in Loans and Advances Decrease in Inventory (Decrease)/Increase in Current liabilities and Provisions Cash Generated from operations Fringe Benefit Tax paid Net Cash generated from operating activities Cash flow from investing activities Purchase of Fixed Assets Proceeds from sale of Fixed Assets Proceeds from Hive off of Tower business Investment in Subsidiary Profit on redemption of units (Current Investment) Interest received Net Cash used for investing activities Cash flow from financing activities Proceeds from Long term borrowings Repayment of Long term borrowings Proceeds from Short term borrowings Repayment of Short term borrowings Proceeds from Acceptance and Cash Credit ( Net) Finance and Treasury charges paid Net cash generated from financing activities Net decrease in cash or cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year B C Notes to Cash Flow Statement Components of Cash and Cash Equivalents includes Cash.25) 1.46 27. 2009 Dr.07 1.13 268.27 (289.34 (0.81) 439.47 (1.32 293.25) (95.03) 36.40 (0.27 610.34 (0.21 (1203.79 0.00) 151.99) 3.78 481.58) 382. Chaukar (Chairman) S.(Net) Profit on transfer of Tower Business Hive off Profit on redemption of units (Current Investment) Foreign exchange loss/(gain) (Net) Interest income Finance and Treasury charges (Net) (158.00) 0.15) 83.87) 673. Purchase of Fixed Assets are inclusive of movements in Capital Work in Progress between the commencement and end of the year Conversion of Foreign Currency Convertible Bonds into Equity Shares are not considered in the Cash Flow Statement.68 751.95) 0.10 (31.47 0.21) 381.95 (6.79) 2.21) 182. 2009 2008-09 Rs.35 (1. in Crores A Cash flows from operating activities Net Loss before tax Adjustments for : Depreciation/Amortisation Gain on Fixed assets sold/written off (Net) Loss on Fixed assets sold/written off/retired from active use. 2.46 (49.98) 2007-08 Rs.67 (798.32) 69. bank balances in Current and Term Deposit Accounts (Refer Schedule 7 to the Balance 1.30 (75.98) (1.84 593.22) 1.34) 162.93 (130.91 486.43) 189. As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A.33 (539.93) 480.080.16) (43. in Crores (124.

592.848.460.13 1. in Crores) Turnover (including other income) Expenditure Loss Before Tax Loss After Tax Earning Per Share (Rs.19 583. 2009 Dr.78 (158. in Crores) (Equity Share Capital & Security Premium Account) Public Issue Rights Issue Bonus Issue Private Placement (Conversion of FCCB) Position of Mobilisation and Deployment of Funds (Rs. State Code Balance Sheet Date Capital raised during the year (Rs.68 2.036.076.84) - III IV V For and on behalf of the Board Kishor A. Venkatesan (Chief Financial Officer) Place: Mumbai Date: May 11.39) (159.60) (0.117.) Dividend Rate Generic Names of three Principal Products/Services of the Company Item Code No.96 1. Chaukar (Chairman) S. (ITC Code) Not Applicable Product Description Telecommunication Services 11-86354 11 March 31.64 5. in Crores) Total Liabilities Total Assets Sources of Funds Paid-up Capital Reserves & Surplus Secured Loans Unsecured Loans Application of Funds Investments Net Fixed Assets (including Capital Work-in-Progress) Net Current Assets Accumulated Losses Performance of the Company (Rs.63 5.00 3.897.16 75. 2009 th II 3.592.14 Annual Report 2008-2009 BALANCE SHEET ABSTRACT AND GENERAL BUSINESS PROFILE I Registration Details Registration No. Joshi (Chief Legal Officer and Company Secretary) ` 56 .15 (448. Mukund Rajan (Managing Director) Madhav J.64 1.053.19) 2.16 2.

2009. in respect of the subsidiary referred to in paragraph 3 above. the Board of Directors of Tata Teleservices (Maharashtra) Limited 1) We have audited the attached Consolidated Balance Sheet of Tata Teleservices (Maharashtra) Limited (the Company) and it's subsidiary (collectively referred to as “the Group”).08 Crores as at March 31. of the state of affairs of the Group as at March31. and in the case of the Consolidated Cash Flow Statement. of the loss for the year ended on that date. the Consolidated Profit and Loss account and the Consolidated Cash Flow Statement for the year ended on that date. as at March 31. annexed thereto. in the case of the Consolidated Profit and Loss Account. An audit includes.B. as well as evaluating the overall financial statement presentation. 4. We conducted our audit in accordance with auditing standards generally accepted in India. total revenues of Rs. 46488 Mumbai Dated: May 11. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements.Auditors' Report To. evidence supporting the amounts and disclosures in the financial statements.17 Crores and net cash inflows amounting to Rs. These financial statements and other financial information have been audited by other auditors whose report has been furnished to us. and our opinion. on 'Consolidated Financial Statements' notified in the Companies (Accounting Standard) Rules. in so far as it relates to the amounts included in respect of this subsidiary. 223. 2009 57 . We did not audit the financial statements of the subsidiary.65 Crores for the year then ended. Our responsibility is to express an opinion on these Consolidated Financial Statements based on our audit. For Deloitte Haskins & Sells Chartered Accountants 2) 3) 4) 5) a) b) c) A. 2009. 351. is based solely on the report of the other auditors. Based on our audit and on consideration of report of other auditors on separate financial statements and on the other financial information of the components. examining on a test basis. 2009. of the cash flows for the year ended on that date. we are of the opinion that the attached Consolidated Financial Statements give a true and fair view in conformity with the accounting principles generally accepted in India : in the case of the Consolidated Balance Sheet. These Consolidated Financial Statements are the responsibility of the Company's management and have been prepared by the management on the basis of separate financial statements and other financial information regarding components. Jani Partner Membership No. An audit also includes assessing the accounting principles used and significant estimates made by the management. whose financial statements reflect total assets of Rs. We report that the Consolidated Financial Statements have been prepared by the Company in accordance with the requirements of Accounting Standard (AS) 21. 2006. and to the best of our information and according to the explanation given to us.We believe that our audit provides a reasonable basis for our opinion.

14 Annual Report 2008-2009 CONSOLIDATED BALANCE SHEET AS AT MARCH 31.19 583.93) 2.425.71 1.68 229. Loans and Advances Cash and Bank Balances Sundry Debtors Inventories Loans and Advances Less : Current Liabilities and Provisions Current Liabilities Provisions Net Current Liabilities Profit and Loss Account Total Significant Accounting Policies and Notes to Financial Statements 17 As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A. 2009 58 . in Crores th 1 2 1.87 3.344. Mukund Rajan (Managing Director) Madhav J.00 27.024.178.75 590.859.897. 2009 Schedule SOURCES OF FUNDS Shareholders' Funds Share Capital Reserves and Surplus Loan Funds Secured Loans Unsecured Loans Total APPLICATION OF FUNDS Fixed Assets Gross Block (at cost) Less : Accumulated Depreciation Net Block Capital Work-in-Progress Investments Current Assets.92 1.Jani Partner 5 4.16 2.14 36.480.166.64 3 4 6 7 8 9 10 11 12 For and on behalf of the Board Kishor A.824. 2009 Rs.49 252. Chaukar (Chairman) S.B.13 1. Joshi (Chief Legal Officer and Company Secretary) Place: Mumbai Date: May 11.67 2.16 3.64 As at March 31. Venkatesan (Chief Financial Officer) Dr.753.060.824.195.35 2.29 5.01 308.85 (469.12 3.02 5. 2009 Place: Mumbai Date: May 11.948.80 1.55 10.

CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31. Joshi (Chief Legal Officer and Company Secretary) Place: Mumbai Date: May 11.B.00 As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A.689.13 (168.21 2.73) 1.058.859. 2009 59 . Depreciation and Tax Finance and Treasury Charges (Net) Depreciation /Amortisation. 2009 Place: Mumbai Date: May 11.68 463.06 2008-09 Rs.21 (169.17 112.32) (18.08 16 305.76) (2.941.94) (2.457.) Significant Accounting Policies and Notes to Financial Statements 17 15 1.02) (0.08) (2.) (Refer Note 17 of Schedule 17) Par Value (Rs.98 600.Fringe Benefits Tax Loss after tax Balance brought forward Add: Adjustment on account of notification on transitional provision of Accounting Standard 11 (Refer Note 26 of Schedule 17) Balance carried to Balance Sheet Earnings Per Share . Chaukar (Chairman) S. Mukund Rajan (Managing Director) Madhav J.Jani Partner For and on behalf of the Board Kishor A. (Refer Note a of Schedule 5) Loss before tax Provision for Tax .670. in Crores 10.90) 14 13 1.68 4.Basic and Diluted (Rs. 2009 Schedule INCOME Telecommunication Services Infrastructure Sharing Revenue Other Income Total EXPENDITURE Operation and Other Expenses Profit before Finance and Treasury charges. Venkatesan (Chief Financial Officer) Dr.

000 Equity Shares of Rs.57 2. 2.259.166.393 Equity Shares are held up by Tata Sons Limited (the ultimate Holding Company) and its Subsidiaries.01 2.190.00 2. 2009 Rs.245. in Crores SCHEDULE .897.3 SECURED LOANS From Banks (Refer note 1 below) Term Loans Cash Credit Accounts Acceptances Deferred payment credits (Refer note 2 below) 1.553.166.12 0.17 6.504 Equity Shares of Rs.1 SHARE CAPITAL Authorised 2.68 47.99 583.10/.897.786 Equity Shares are issued during the period on conversion of Foreign Currency Convertible Bonds.500.16 SCHEDULE .2 RESERVES AND SURPLUS Securities Premium account:Balance at the beginning of the year Add: On conversion of Foreign Currency Convertible Bonds Balance at the end of the year 576.13 60 . 2009 As at March 31.19 Notes: 1.500. th SCHEDULE . Of the above 3.14 Annual Report 2008-2009 SCHEDULES FORMING PART OF THE CONSOLIDATED BALANCE SHEET AS AT MARCH 31.000. Of the above 1.500.19 1.87 564.00 Issued and Subscribed 1.626.each fully paid-up 1.each 2.10/.897.

00 1. 2009 Notes : 1.111.16 61 .by assignment of telecom license.24.4 UNSECURED LOANS Foreign Currency Convertible Bonds (FCCB) (Refer note below) From Banks . The holders of these Bonds have an option to convert the Bonds into Equity Shares of the Parent company on or after July 1. the conversion price has been adjusted to Rs.Subsequent to rights issue of Equity Shares. Loans from Banks are secured by either one or more of the following as per terms of the arrangements with respective banks: .38% at the end of 5 years from the date of issue.by pledge of shares of promoters. . Secured by hypothecation of vehicles acquired out of the loans.178.24.by assignment of the proceeds on sale of network in the event of cancellation of the telecom license.The Bonds that are not converted into Equity Shares. 2004 at a pre-determined price of Rs.Short Term Loans 1. .96 per Equity Share .by assignment of insurance policies.by hypothecation of present and future book debts and outstanding money receivable.by first pari pasu charge on the movable and/or immovable assets of the company. 2005. the Parent Company issued FCCB of USD 125 millions at an interest rate of 1% per annum (payable semi-annually). . . 2. are redeemable at a premium of 19.16 Note: During the year ended March 31.49 per Equity Share. . 67. SCHEDULE .SCHEDULES FORMING PART OF THE CONSOLIDATED BALANCE SHEET AS AT MARCH 31.

Deletions tions March 31.48 1. 2009 62 Tangible Assets Leasehold assets Land Office premises Buildings Plant and Machinery Furniture. 368.81 3.11 0.80 63.5 (Rs. 2009 (Refer Note c) 2008 2009 For the Deletions ments (Refer Note c) Upto AdjustApril 1.61 Crores on account of related provision for obsolescence on capital inventory.343.06 370.87 Capital advances Capital Inventory [net of provision for obsolescence of Rs.87 0.86 8.12 5.663.00 2.73 53.34 3.11 Crores] Assets under construction (Refer Note 23 of schedule 17) Notes: (a) Depreciation in the Profit and Loss Account for the year includes amounts aggregating to Rs.52 13.71 6. ments period March 31.74 0.948.28 0.68 7.42 20.5 years (Also refer Note 23 of Schedule 17) .15 0.68 SCHEDULES FORMING PART OF THE CONSOLIDATED BALANCE SHEET AS AT MARCH 31.58 Crores (Gross Block) written off.80 372.14 1.11 6.26 14.87 1.65 1.31 0.49 461.195.11 20.16 21.822.59 1.73 1.15 793.84 1.524.14 0.87 (d) 925.66 3.42 4.73 11.91 1.63 12.02 125. (b) Deletion of Plant and Machinery includes assets aggregating to Rs. 18.97 5.52 279.85 76.63 1.10 0. in Crores) GROSS BLOCK DEPRECIATION NET BLOCK FIXED ASSETS PARTICULARS Notes As at AdjustAddi.23 0.81 1.29 26. April 1.421. 1.49 19.07 0.38 6.08 1.95 48.15 1.21 61.13 0.07 83.53 0.48 13. (Refer note 22 of Schedule 17).97 0. Fixtures and Office Equipment Vehicles Intangible Assets License Indefeasible Rights of Use ('IRU') Computer Software Capital Work-In-Progress: 28.75 3.294.48 816.753.43 22.00 229.96 306.04 1. 2008 As at Upto As at March 31.91 24.86 13.08 420.40 371. (d) Remaining amortisation period for CDMA License fees 8.53 1.94 4.11 0.77 618.58 925.479. (c) Adjustments in Gross Block and depreciation pertain to adjustment on account of notification on transitional provision of Accounting Standard 11 (Refer Note 26 of Schedule 17) .83 370.06 19. 2009 14 Annual Report 2008-2009 ( b) 70.74 1. .th SCHEDULE .21 62.78 0.73 5.38 0.

Cash Credit Accounts (Refer Note 1 of Schedule 3) 0.41 0.99 each) 10.Face Value of Rs 10 each (NAV of Rs.00 SCHEDULE .Current Accounts .448.7 CASH AND BANK BALANCES Cash on hand Balance with Scheduled Banks in .944 units of ICICI Prudential Liquid Plan Super Institutional Growth Plan . 2009 Rs.Trade: 77.49 SCHEDULE .SCHEDULES FORMING PART OF THE CONSOLIDATED BALANCE SHEET AS AT MARCH 31.06 513.01.45 237.9 INVENTORY Traded Goods Starter Kits 276. 12.67 260.51 260.84 2.67 252.6 INVESTMENT Current Investment (At lower of cost or net realizable value) (Quoted) Non .01 63 .84 252.01 2. 2009 As at March 31.02 27.06 27.8 SUNDRY DEBTORS (Unsecured ) Outstanding for a period exceeding six months Others Less: Provision Note: Considered good Considered Doubtful SCHEDULE . in Crores SCHEDULE .00 10.

14 16.62 136.05 0.27 14.10.14 Annual Report 2008-2009 SCHEDULES FORMING PART OF THE CONSOLIDATED BALANCE SHEET AS AT MARCH 31. 2009 Rs.74 Crores SCHEDULE .75 2.18 Crores due from an officer of the Company Maximum amount outstanding at any time during the year is Rs.77 40.12 Provisions For Contingencies For Retirement benefits For Premium on Redemption of FCCB For Fringe Benefits Tax (net of advances) th 265.0.62 308.55 0.07 4.10 LOANS AND ADVANCES (Unsecured) Advances recoverable in cash or in kind or for value to be received [Includes Rs.71 Note: Provision for contingencies relate to certain claims by vendors on the Company made in earlier years and there is no movement in the same during the period.56 4. 64 .37 2.88 872.21 86.89 1.97 60.0.15 36.33 735.75 308.11 Current Liabilities Sundry Creditors (Refer Note 24 of Schedule 17) Total Outstanding dues of Micro Enterprises and Small Enterprises Total Outstanding dues of Creditors other than Micro Enterprises and Small Enterprises: Under Usance Letter of Credit Others Deposits from Customers and others Interest accrued but not due on loans Other liabilities Note: Other Liabilites include temporary overdrawn bank balances aggregating to Rs.024.18 Crores] Premises and other deposits Assets retired from active use awaiting Disposal (Refer Note 21 of Schedule 17) Advance Tax paid (Tax Deducted at Source) Less : Provision Note : Considered good Considered doubtful SCHEDULE .99 311.74 5. 2009 March 31. in Crores SCHEDULE .

71 Crores] Power Rent Rates and taxes Insurance Infrastructure Sharing Cost Others 171.62 8.88 1.08 25.66 8.21 4.98 65 . 2009 April 1.23 11.60 112.14 OTHER INCOME Subsidies from Department of Telecommunications (DoT) (Refer Note 25 of schedule 17) Liability in respect of earlier years written back Infrastructure Sharing Sale of Refurbished NIU's Miscellaneous Receipts 92.SCHEDULES FORMING PART OF CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED AS AT MARCH 31.78 1.13 TELECOMMUNICATION SERVICES Telephony Internet Services Interconnection Usage Charges [including in respect of earlier years Rs.76 5.Plant and Machinery [including capital inventory consumed Rs 15. 2009 Rs.68 SCHEDULE .98 Crores] Payments to and Provisions for Employees Salaries and Bonus [Net of excess provision for earlier year written back Rs. 2008 to March 31. in Crores SCHEDULE .15 19.14 18.28 2.5.03 59.81 194.679.64 Interconnection and Other access costs [including in respect of earlier years Rs.941.21 SCHEDULE .58 359.80 Crores] Contribution to Provident and other Funds Staff Welfare 98.34 63.5.46 Crores] Sale of Traded Goods 1.15 OPERATION AND OTHER EXPENSES Network Operation costs Revenue Share to DoT Repairs and Maintenance . 5.87 112.91 3.94 8.95 474.95 48.

66 26.68 6.74 99. 2008 to Mar 31.22 9.15 2.4.63 305.7.20 0.08 18.59 Crores) Insurance Expenses Miscellaneous expenses Contractual and other claims and liabilities (Net) Marketing and business promotion expenses Advertisement and business promotion expenses Hand set Subsidy (Net of Rs.48 12. in Crores Administrative and Other expenses Rent Rates and taxes Repairs and Maintenance -others Travel and conveyance expenses Collection/Credit verification charges Customer service and call centre cost Assets awaiting disposal written off (Refer Note 21 of Schedule 17) Loss on Fixed assets sold/written off/retired from active use (Net) Provision for Bad/Doubtful debts and advances (Net of insurance received amounting to Rs.12 6.13 351.54 105. bill discounting and bank charges Foreign exchange fluctuations (Net) Less: Interest Capitalized (Refer Note 23 of schedule17) Less: Profit on redemption of units (Current Investment) 275.25 2.04 55.64 Crores incentive received) Sales Commission and Expenses Traded Goods .68 66 .98 SCHEDULE .58 80.03 305.87 1.16 FINANCE AND TREASURY CHARGES (NET) Interest On Fixed Term Loans Others Expenses for loan arrangement.457.11 1.26 212.01 9. 2009 th April 1.90 1.36 36.36 297.34 45. 2009 Rs.19 13.71 0.Starter Kits Opening Stock Purchases Less: Closing stock 14.52 83.14 Annual Report 2008-2009 SCHEDULES FORMING PART OF CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED AS AT MARCH 31.75 0.34 15.

SCHEDULES FORMING PART OF THE CONSOLIDATED BALANCE SHEET AND PROFIT AND LOSS ACCOUNT SCHEDULE 17 SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO FINANCIAL STATEMENTS 1. Company background Tata Teleservices (Maharashtra) Limited (“TTML”/”Parent Company”), is licensed to provide basic and cellular telecommunication services. TTML presently holds two Unified Access (Basic and Cellular) Service Licenses, one for Mumbai Service Area and another for Maharashtra and Goa and provides telecommunication services using Code Division Multiple Access (CDMA) technology. TTML has also been granted approval by Department of Te l e c o m m u n i c a t i o n s ( D o T ) f o r p r o v i d i n g telecommunication services using Global System for Mobile Communications (GSM) technology under the aforesaid licenses. TTML has already been allotted trial Spectrum by DoT for Mumbai, Maharashtra and Goa Service Area. TTML also holds the National Internet Service provider Internet Telephony license. TTML is a subsidiary of Tata Sons Limited (the ultimate holding Company). 21st Century Infra Tele Limited (“CITL”/”subsidiary”) became a wholly owned subsidiary of TTML w.e.f July 1, 2008. CITL provides passive infrastructure support to telecommunication service providers. The Department of Telecommunications, Ministry of Communication and IT, Government of India has registered CITL as a Infrastructure Provider Category I (IP-I) with effect from 30th September, 2008. CITL has entered into a Business Transfer Agreement with TTML on September 30, 2008 for purchase of “Passive Tower Infrastructure Business” ('PI Business') from TTML on a going concern basis for a lump sum consideration. 2. (a) Significant Accounting Policies Basis of preparation of financial statements The accompanying Consolidated Financial Statements of TTML and its subsidiary as aforesaid (hereinafter together referred as “the group”), have been prepared to comply in all material aspects with applicable accounting principles in India, the Accounting Standards (AS) notified in the Companies (Accounting Standards) Rules 2006. The financial statements of the subsidiaries used in the consolidation are drawn up to the same reporting date as that of the Parent Company namely March 31, 2009. (b) Principles of Consolidation The financial statements of the Parent Company and its subsidiary have been consolidated on a line by line basis by adding together the book value of like items of assets, liabilities, income, expenses, after eliminating intra group transactions and any unrealized gain or losses on the balances remaining within the group in accordance with the Accounting Standard 21 on “Consolidated Financial Statements” (AS-21). The financial statements of the Parent Company and its (e) (c)

subsidiary have been consolidated using uniform accounting policies for like transaction and other events in similar circumstances. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting year. Differences between actual results and estimates are recognised in the periods in which the results are known / materialise. (d) Fixed Assets Fixed assets are stated at their historical cost of acquisition or construction, less accumulated depreciation/amortisation. Cost includes all costs incurred to bring the assets to their working condition and location (Also refer note 26). Assets retired from active use and held for disposal are stated at lower of net book value or net realisable value. (Refer note 21). Expenditure related to and incurred during the construction period of switches and cell sites are capitalised as part of the construction cost and allocated to the relevant fixed assets. Capital inventory comprises switching equipment, field unit cards, tower equipment, capital stores and other accessories that are carried under Capital Work-InProgress till such time as they are issued for new installation or replacement. The Group capitalises software and related implementation costs as intangible assets, where it is reasonably estimated that the software has an enduring useful life. License fees paid by the Parent Company for acquiring licenses to operate telecommunication/internet telephony services are capitalised as intangible assets. Indefeasible Rights to Use ('IRU') bandwidth capacities by the Parent Company are capitalised as intangible assets. Assets acquired pursuant to an agreement for exchange of similar assets are recorded at the net book value of the assets given up, with an adjustment for any balancing receipt or payment of cash or any other form of consideration. Depreciation i) Fixed assets are depreciated on a straight line basis, based on the following estimates of their useful economic lives: Useful Life (in years) 60 12 9

Buildings Plant and Machinery Network Equipment Time Division Multiple Access (TDMA) Equipment (Refer note 21)

67

14 Annual Report 2008-2009
Outside Plant Network Interface Units (Refer note 22 ) Air- Conditioning Equipment Generators Electrical Equipments Computers Office Equipments Computer Software Furniture and Fittings Vehicles ii) iii) 18 5 6 6 6 3 3 3 3 5 (g) arising at the inception of the contract is amortised as expense or income over the life of the contract. iv) Pursuant to the announcement on accounting for derivatives issued by the Institute of Chartered Accountants of India (ICAI), the Parent Company in accordance with the principle of prudence as enunciated in Accounting Standard 1 on 'Disclosure of Accounting Policies' provides for losses in respect of all outstanding derivative contracts at the Balance Sheet date by marking them to market. Any gains arising on such mark to market are not recognized as income (refer note 16 (ii)).

th

Leasehold land and premises are amortised uniformly over the period of lease. Amortisation on License fees is provided for uniformly over the original license period of 20 years from the date of commencement of operation. Since the Parent Company has the intention of being in business for a period well beyond 10 years and the telecommunication business cannot be carried on without the Telecom license, the useful life of the asset will exceed the rebuttable presumption of 10 years under AS 26 on “Intangible Assets”. (Refer note 23). Indefeasible Right to Use ('IRU') bandwidth capacities taken by the Parent Company are amortised over a period of fifteen years based on a technical estimate of useful life of the assets or period of the agreement whichever is lower. Depreciation on additions and deletions to assets during the year is charged to revenue pro rata to the period of their use. The Group provides for obsolescence of its slow moving capital inventory, by way of depreciation, at the rate of 33.33% p.a. of cost. Transactions in foreign currency are recorded at the original rates of exchange in force at the time transactions are effected. Foreign currency denominated assets and liabilities are reported as follows: a) Monetary items are translated into rupees at the exchange rates prevailing at the balance sheet date. Non-Monetary items such as fixed assets are carried at their historical rupee values. Gains/losses arising on settlement of foreign currency transactions or restatement of foreign currency denominated assets and liabilities (monetary items) are recognised in the profit and loss account, except for long term assets/liabilities which pertain to acquisition of fixed assets which are adjusted in the cost of fixed assets (Refer note 26).

Employee benefits Retirement benefit costs are expensed to revenue as incurred. Contributions to the Provident and Superannuation Funds are made in accordance with the rules of the Funds. The Parent Company participates in a group gratuity cum life assurance scheme administered by the Life Insurance Corporation (LIC). Provision for the year in respect of gratuity is made on the basis of actuarial valuation as at the end of the year. Leave encashment and gratuity are provided for on the basis of actuarial valuation as at the end of the year.

iv)

(h)

Revenue recognition Revenue from telecommunication services is recognised as the service is performed on the basis of actual usage of the Parent Company's network/in accordance with contractual obligations and is recorded net of service tax. The amount charged to subscribers for specialised features which entitle them to access the network of the Parent Company and where all other services and products are paid for separately, are recognised as and when such features are activated. Revenue is recognised when it is earned and no significant uncertainty exists as to its ultimate realisation or collection.

v)

vi)

(f)

Foreign Currency transactions i)

ii)

(i)

Government Grants Subsidies granted by Government for providing telecom services in rural areas are recognized as income in accordance with the relevant terms and conditions of the scheme / agreement with DoT (refer note 25 below).

(j)

Borrowing costs Borrowing costs attributable to the acquisition of a qualifying asset, as defined in AS 16 on “Borrowing Costs”, are capitalised as part of the cost of acquisition. Other borrowing costs are expensed as incurred.

b)

(k)

Earnings per share The Group reports basic and diluted earnings per share in accordance with AS 20 on “Earnings Per Share”. Basic earning per share is computed by dividing the net profit or loss for the year by the weighted average number of Equity shares outstanding during the year. Diluted earnings per

iii)

In case of forward exchange covers entered into by the Parent Company, the premium or discount

68

share is computed by dividing the net profit or loss for the year by the weighted average number of Equity shares outstanding during the year as adjusted for the effects of all dilutive potential equity shares, except where the results are anti-dilutive. (l) Operating Leases Assets taken on Lease under which all significant risks and rewards of ownership are effectively retained by the lessor are classified as Operating Leases. Lease payments under Operating Leases are recognized as expenses as incurred in accordance with the respective Lease Agreements. (m) Cash Flow Statement The Cash Flow statement is prepared by the indirect method set out in AS 3 on “Cash Flow Statements” and presents Cash flows by operating, investing and financing activities of the group. (n) Foreign Currency Convertible Bonds (FCCBs) Expenses Premium payable on Redemption of FCCBs is fully provided for on issue of the FCCBs. The Securities Premium Account is applied in providing for premium on redemption in accordance with Section 78 of the Act. On conversion of the FCCBs to Equity Shares the redemption premium is reversed. Expenses on issue of FCCBs and on Rights issue of Equity Shares are written off to the Securities Premium Account in accordance with section 78 of the Act. (o) Finance andTreasury charges Net finance and treasury charges are disclosed in the financial statements. Interest and other income earned from treasury operations are reduced from the costs of treasury operations. (p) Inventories Inventories are valued at lower of cost and net realizable value. Cost of Inventories comprises all cost of purchases and other costs incurred in bringing the inventories to their present location and condition. Cost of traded goods is determined on weighted average basis. (q) Fringe BenefitsTax Fringe Benefits Tax (FBT) is recognized as per the provisions of the Income-tax Act, 1961 and the Guidance Note on Accounting for Fringe Benefits Tax issued by the ICAI. (r) Impairment of assets An asset is considered as impaired in accordance with AS 28 on “Impairment of Assets” when at the balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exceeds its recoverable amount (i.e. the higher of the asset's net selling price and value in use). In assessing the value in use, the estimated future cash flows expected from the continuing use of the asset and from its ultimate disposal

are discounted to their present values using a predetermined discount rate.The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the profit and loss account. (s) Investments Current investments are carried at lower of cost and fair value. Long term investments are carried at cost. Provision is made to recognise a decline other than temporary in the carrying amount of long term investments. (t) Contingent Liabilities Contingent Liabilities as defined in AS 29 on “Provision, Contingent Liabilities and Contingent Assets” are disclosed by way of notes to accounts. Provision is made if it becomes probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability. 3. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Counter guarantees given by the Parent Company

525.03 760.00

4. 5. (i)

Contingent liabilities : Claims against the Parent company not acknowledged as debt Telecom Regulatory Matters 405.76 (Refer notes below) 98.03 Others Notes: Contingent liabilities in respect of Telecom Regulatory Matters include: a) The Parent Company had received an Order from the Hon. Supreme Court dismissing the Parent Company's petition regarding Access Deficit Charge (ADC) demanded by Bharat Sanchar Nigam Limited (BSNL) in respect of 'fixed wireless' services provided under the brand name “WALKY”. Demand notices have been received from BSNL, to pay ADC aggregating to Rs.108.49 crores for the period November 14, 2004 upto February 28, 2006; the date after which ADC is payable on Net Adjusted Gross Revenue Basis. Out of the above, the Parent Company, has, in earlier years, already provided for amounts aggregating to Rs.28.14 Crores pertaining to ADC for the period from August 26, 2005 upto February 28, 2006. The balance amounts aggregating to Rs. 80.35 Crores have been disclosed as Contingent Liability under 'Telecom Regulatory Matters' as the Parent company is of the view that these demands include amounts relating to 'wireline' services and ADC for the period before August 26, 2005; the actual date after which, as per the directions of the Department of Telecom, services provided under the brand name “WALKY” are to be considered as Wireless in Local

69

2009. 2009. together with interest and penalties. 2008. The position of the allotted warrants is as follows: As at March 31.303 Crores towards loss of (opportunity to earn ) license fee and Rs.015 Crores which includes Rs. The TDSAT vide its order dated September 18. vide its demand letters dated July 3. (i. The Parent Company has filed a review petition in this regard and on the said basis.) 0. Reconciliation of the differences is in progress with the WPC. ii) Disputed Tax demands in Appeals before authorities: Income Tax iii) relevant 0.22 Crores). DoT appealed to the Hon'ble Supreme Court which without commenting on the merits of the counter-claim confirmed that TDSAT had jurisdiction and remanded the matter to TDSAT for fresh adjudication. 1998 to June 30. TDSAT allowed refund of Rs.950 7. which is in addition to Rs. The Parent Company is awaiting the relevant information from BSNL.38 Crore. 2008 held that since the counter claim filed by DoT is in the nature of a recovery suit appropriate court fee needs to be affixed. The Parent Company in 2002 had filed a petition before Telecom Dispute and Settlement Appellate Tribunal (TDSAT) claiming refund of Rs.41 Crores) [net of USD 6. Up-till the end of the year.55 Crores (Rs.69 Crores by DoT.22 0. failing which the Parent Company will be liable to pay the differential customs duty. favorable outcomes are anticipated and no liability is expected to accrue to the Parent Company.50 Crores to the Parent Company with interest of 17% p.20 Crores warrants were issued to Hughes Tele. DoT during the proceedings before TDSAT claimed from the Parent Company Rs. appropriate competent professional advice is available to the Parent Company based on which. 2008 which was further increased to Rs.) 7. 2008.24 Crores) for which the Parent Company has applied for exemption] to be fulfilled during a period of 8 years commencing from the 29th January 2003. This demand was subsequently revised to Rs. The period during which the vested warrants may be exercised expires after 10 years from the date of the vesting.TDSAT had no jurisdiction) and facts. the Parent Company has fulfilled the export obligation to the extent of Rs.950 Opening Balance Issued during the year Forfeited Exercised Lapsed Closing Balance 70 .50 Crores recovered by Department of Telecommunications (DoT) in 1999 alleging failure to sign basic services license agreement for Karnataka circle after accepting Letter of Intent (LoI). Each allotted warrant carries with it a right to purchase one Equity Share of the Parent Company at a price of Rs. 2008 held that BSNL and TTML should exchange relevant information and reconcile the differences.The Parent company is expecting a revised order after the completion of the reconciliation and is hopeful of success in the matter.00 Crores vide letter dated February 28.184. As regards other disputes and claims against the Parent Company. 10/. 2008 from DoT for Rs. 262. 2005 to February 29.e. being a demand for spectrum charges for the period from April 1.2. TDSAT vide its order dated August 12.a. 64.40.05 0. until fully vested. in Crores i) ii) iii) iv) Audit fees Tax Audit fees Other matters (For Quarterly Audits.21 th Out of pocket expenses [Current year Rs.08 Crores (Rs. 404. the Parent Company established the Employee Stock Option Plan (ESOP) under which Equity Shares are reserved for issuance to eligible employees of the Parent Company. The Parent Company has represented to the WPC various items of differences mentioned in the demand orders. 1. Payments to Auditors (excluding service tax) : 2008-09 Rs.53 Crores (previous year Rs 21. if imposed. for the period from October 1. 25 Crores paid in earlier years. which was disclosed as contingent liability as at March 31.per share. 2008. In terms of the plan. b) The Parent Company had received a demand letter dated March 17.50 Crores in relation to the above. 2009 (Nos. 35.712 Crores calculated upto March 31. 2008.14 Annual Report 2008-2009 Loop (Mobile) for the purposes of ADC.1. vide letter dated September 24. Other than 2.8. 2008.The Parent Company is hopeful of success in the matter. 351 Crores as interest till October 31.303 Crores towards loss of (opportunity to earn) license fee and interest of Rs. 6. all allotted warrants vest at the rate of 25% on each successive anniversary of the grant date.The Parent Company is hopeful of success in the matter. DoT has filed with TDSAT a counter-claim of Rs.000 fully vested warrants allotted in an earlier year. certification work etc.The matter has been adjourned for hearing on August 12. and dismissed the counter-claim based on a law point iv) In November 1999.com (India) Limited Employees Stock Option Trust. to be held by it on behalf of the Parent Company for awarding eligible employees as and when advised by the Compensation Committee constituted for the purpose.08 7. The Parent Company during the year has made on account payment to BSNL of Rs. The Parent Company has undertaken export obligation to the extent of USD 10. 2002. Counter guarantees have been given by the Parent Company in the ordinary course of business and no liability is expected to accrue in this respect. 266.123/-] The Parent Company has imported certain capital equipment under “Export promotion of Capital Goods Scheme” of the Central Government at a concessional rate of Customs Duty.

Since the market value of the Parent Company’s shares on the grant dates did not exceed the exercise price of Rs. 10/-, no compensation expense has been recorded 8. Segment information The group is engaged in providing Telecommunication services and providing passive infrastructure support services to Telecommunication Service Provider. Accordingly, in accordance with Accounting Standard 17 on “Segment reporting”, the primary reporting segments of the Group, therefore, are the business segment, viz. i) ii) A. Telecommunication Services Passive Infrastructure Services The revenues / assets / results for the year from the activity of providing passive infrastructure support services by the subsidiary company, is not material to the consolidated financials. Accordingly, the business segment of Passive Infrastructure Support Services is not identified as a Reportable segment. The group operated only in the Indian market representing a singular economic environment with similar risks and rewards and hence there are no reportable geographical segments. Operating lease rent expenses for the year in respect of lease agreements entered from April 1, 2001 2008-09 Rs. in Crores Residential Flats for accommodation of employee 0.82 Cell Sites and others 56.86 Future Minimum Lease Payments under NonCancellable Operating Lease : Due not later than one year Due later than one year and not later than five years 36.86 123.67

Particulars

As at March 31, 2009 Rs. in Crores 3.99 2.77 1.22 1.38 0.21 1.28 (0.11) 0.01 2.77 (0.78)

Projected benefit obligation, end of the year Fair value of plan assets at the end of the year Net liability recognized in the Balance Sheet. Fair Value of Plan Assets at the beginning of the year Expected Return on Plan Assets Contributions Benefit Paid Actuarial loss on Plan Assets Fair Value of Plan Assets at the end of the year Total Actuarial Loss Recognized Actuarial Assumptions: Discount rate Rate of increase in compensation levels of covered employees Rate of Return on Plan Assets 11.

B.

9.

(a)

7.75% 6.50% 8.00%

(b)

No provision for current income tax has been made in the accounts, since the Group estimates that there will be no taxable profits for the period. Deferred Tax charges/ credits have not been recognized in view of the tax holiday enjoyed by the Parent Company and on considerations of prudence as set out in AS 22 on “Accounting for Taxes on Income”. Value of imports on CIF basis in respect of : 2008-09 Rs. in Crores 364.39

12.

The agreements are executed for a period ranging from 6 months to 15 years with a renewable clause and in many cases also provide for termination at will by either party giving a prior period notice ranging between 30 to 90 days. 10. The disclosure as required under AS 15 regarding the group's gratuity plan is as follows: As at March 31, 2009 Rs. in Crores 2.27

Capital Goods 13. Expenditure in Foreign Currency (Payment basis) on account of :

Particulars

Interest Other

2007-08 Rs. in Crores 21.86 1.13 22.99

Projected benefit obligation, beginning of the year Service cost Interest cost Actuarial loss on obligation Benefits paid Projected benefit obligation, end of the year

14. 0.81 0.24 0.78 (0.11) 3.99

Value of Capital Inventory consumed during the year : 2008-09 Rs. in Crores Indigenous Imported 15.30 0.41 15.71 % 97 03 100

71

15) Related Party disclosures (in terms of Accounting Standard - 18)
th

i) a) (Rs. in Crores) Ultimate Holding Company Tata Sons Tata Tata Tata THDC Ltd. Tata AIG Tata AIG General Insurance Co. Ltd. Life Insurance Co. Ltd. Consultancy Services Ltd. Internet Support Services Ltd. (formerlyE2E Serwiz Solutions Ltd.) 1 2 3 4 5 6 7 0.11 0.15 2.20 4.55 0.02 0.01 3.60 0.61 0.06 21.91 17.88 0.03 2.63 0.60 1.66 0.02 0.93 6.44 11.13 12.70 6.19 17.45 0.24 26.14 10.77 1.10 7.79 3.97 47.28 1.73 1.66 15.20 0.02 0.34 0.10 8 1.36 0.48 Ltd. Tata Business Ltd. Services Ltd. Teleservices Tata Sky Ltd. (formerly Space TV Ltd.) 9 0.01 1.07 0.16 Fellow Subsidiaries

Details of transactions with Related Parties For year ended March 31, 2009

14 Annual Report 2008-2009

Particulars

72

1) Expenses : - Salary - Customer Service and Call Centre Cost - Advertisement and Business promotion expenses (Net) - Network operation cost - Administrative and Other Expenses - Rent - Interconnect and Access charges (Net) - Infrastructure Sharing Charges - Interest 2) Income : - Towards Recharge Coupon Vouchers - Rent - Rendering Telecom Services - Profit on transfer of Tower Business Hive-off 3) Reimbursement of Expenses 4) Purchase of Fixed Asset 5) Unsecured Loan repaid 6) Security Deposits taken 7) Unsecured Loan taken 8) Outstanding as at March 31, 2009 : Sundry Debtors Sundry Creditors Loans and Advances

Since the figures are less than the denominations disclosed, the figures donot appear Figures above are inclusive of Service Tax where ever applicable

15) Related Party disclosures (in terms of Accounting Standard - 18)
(Rs. in Crores) Fellow Subsidiaries Personnel TCE Consulting Capital Ltd. Engineers Ltd. Director Tata Others Managing Key Management

i) a)

Details of transactions with Related Parties For year ended March 31, 2009

Particulars

CMC Tata Asset E-NXT Financials Pvt Ltd. Management Ltd. Ltd. Ltd. Securities Retail Tata Infiniti Ltd.

Total

10 11 12 13 14 15 16 0.20 0.42 0.26 0.03 0.80 20.00 20.00 0.23 0.01 0.03 0.01 1.19 0.41 0.48 0.04 0.33 0.04 0.44 0.02 0.54 (0.06) -

17

18 1.85 0.01 8.29 35.67 13.12 6.19 17.45 1.98 26.14 0.20 10.77 1.10 36.99 3.97 47.31 20.00 1.73 20.00 5.97 20.68 0.02

73

1) Expenses : - Salary - Customer Service and Call Centre Cost - Advertisement and Business promotion expenses (Net) - Network operation cost - Administrative and Other Expenses - Rent - Interconnect and Access charges (Net) - Infrastructure Sharing Charges - Interest 2) Income : - Towards Recharge Coupon Vouchers - Rent - Rendering Telecom Services - Profit on transfer of Tower Business Hive-off 3) Reimbursement of Expenses 4) Purchase of Fixed Asset 5) Unsecured Loan repaid 6) Security Deposits taken 7) Unsecured Loan taken 8) Outstanding as at March 31, 2009 : Sundry Debtors Sundry Creditors Loans and Advances

The above includes Rs. 0.77 Crores given to Mr. Charles Anthony (Ex Managing Director) towards performance pay for the financial year 2007-08 Since the figures are less than the denominations disclosed, the figures donot appear Figures above are inclusive of Service Tax where ever applicable Others Include Tata Realty & Infrastructure Ltd. Tata Investment Corporation Ltd. Ewart Investments Ltd. Tata Petrodyne Ltd. Computational Research Laboratories Ltd. Tata Trustee Company Private Ltd.

10.E.10.F. (W.09.E.A. Tata America International Corporation Tata Consultancy Services (Africa) (PTY) Ltd.E. 26. Ltd.08) Gurgaon Infratech Pvt. Financial Network Services (Beijing) Co.09. Zug Tata Internet Services Limited Tata Investment Corporation Limited Tata Limited Tata Pension Management Ltd Tata Petrodyne Limited Tata Realty and Infrastructure Limited Tata Securities Limited Tata Sky Limited Tata Teleservices Limited Tata Trustee Company Pvt. (w.10.12.E. Ltd.E. Tata Consultancy Services Deutschland GmbH Tata Consultancy Services Do Brasil Ltda (Formerly Tata Consultancy Services Do Brasil S.09.F.) (W.E.F.K. (W.12. Tata Consultancy Services De Espana S. Pioneer Infratech Pvt. (formerly TCS Argentina S.F.12.F. 2.09.e.19. Ltd.09. TRIL Constructions Ltd. TCS Solution Center S.f.) Tata Consultancy Services France SAS (Formerly TKS .08) Landscape Structures Pvt. Ltd.Tecknosoft S.07.30.E.30.. Ltd. Limited (W. WTI Advanced Technology Ltd. 01. Ltd. 15. Ltd.12.08) Tata Capital Pte.f.03. Limited (W.Tecknosoft (France) SAS) Tata Consultancy Services Japan Ltd.F.e. Ltd. (W.2.29. Ltd. 19. (W.2008 ) Tata Consultancy Services Argentina S..08) Tata Capital Limited (formerly Primal Investment and Finance Limited) Tata Capital Markets Limited Tata Capital Markets Pte.18) ii) Details of all Related Parties and their relationships A B C 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 Ultimate Holding Company Tata Sons Limited Subsidiary Companies 21st Century Infra Tele Limited (W.A TCS e-Serve America. 15.e.F. De C. TRIF Kochi Projects Pvt.07.08) Tata Advanced Systems Limited (W.A.E.E.12. 11. 17.09) Ahinsa Realtors Pvt.f. Ltd.A. Ltd.08) List of Fellow Subsidiaries Actve Digital Services Pvt Ltd (W.e.2008) Financial Network Services (H. 07.F.09.08) Tata AG. Ltd (W. LLC TCS Financial Solutions Australia Holdings Pty Limited (Formerly Financial Network Services (Holdings) Pty.e. Limited (W.08) TRIF Property Development Pvt.f. Ltd. (W. 26.2009 ) TCS e-Serve International Limited (Formerly CGSL International Limited)(w.08) and Ceased to be a subsidiary w.E. Inc (w. Tata Consultancy Services Luxembourg S.E.F.F.08) Panatone Finvest Limited Tara Aerospace Systems Limited (W. Ltd.F.F. Tata Consultancy Services De Mexico S.2008 ) TCS Financial Management.) Tata Information Technology (Shanghai) Company Limited Tata Infotech (Singapore) Pte.12. TRIL Developers Ltd. TC Travel And Services Limited (W. TRIF Infrastructure Pvt.) Limited Financial Network Services Malaysia Sdn Bhd (Under Voluntary Liquidation) MP Online Limited PT Financial Network Services PT Tata Consultancy Services Indonesia Syscrom S. Ltd.F.E.08) TRIF Gandhinagar Projects Pvt.f.F. Tata Consultancy Services Belgium SA Tata Consultancy Services BPO Chile SA (Formerly Tata Consultancy Services Chile Limitada) Tata Consultancy Services Canada Inc. Ltd.e.E. Ardent Properties Pvt.F.12.A Tata Consultancy Services Malaysia Sdn Bhd Tata Consultancy Services Morocco SARL AU Tata Consultancy Services Netherlands BV Tata Consultancy Services Portugal Unipessoal Limitada Tata Consultancy Services Sverige AB Tata Consultancy Services Switzerland Ltd. Ltd. Ltd.01.A.14 Annual Report 2008-2009 15) Related Party disclosures (in terms of Accounting Standard .08) TRIF Erectors Pvt.f. 12. APONLINE Limited C-Edge Technologies Limited CMC Americas Inc CMC Limited Custodia De Documentos Interes Limitada Diligenta Limited Financial Network Services (Africa) (Pty) Ltd.12.E. 05. 21. Zug Tata AIG General Insurance Company Limited Tata AIG Life Insurance Company Limited Tata Asset Management (Mauritius) Pvt Limited Tata Asset Management Limited Tata Business Support Services Limited (formerly E2E SerWiz Solutions Limited) Tata Capital Advisors Pte.F. 31. TRIF Mega Projects Pvt.12.08) Arrow Infra Estates Pvt. Tata Consultancy Services (Philippines) Inc. Limited) TCS FNS Pty. Ltd. 2008) th 74 .09.V. (formerly Unitech Construct Well Pvt.04. TRIF Kolkata Projects Pvt.31.A. Tata Consultancy Services (Thailand) Limited (w.19. Financial Network Services (Europe) plc (Ceased to be a subsidiary w.F.E. TRIF Hyderabad Projects Pvt.12. Ltd.E.08) TRIF Trivandrum Projects Pvt.(formerly Unitech Real Tech Ltd. TRIL Airport Developers Ltd.12.E.F.A. Ltd.31.31.f.12.) (W.2008) Computational Research Laboratories Limited Concept Marketing and Advertising Limited e-Nxt Financials Limited Ewart Investment Private Limited Ewart Investments Limited Good Health TPA Services Limited (W.E.08) Tata Capital Housing Finance Limited (W. 2008) Charles Anthony (Upto Feb 29. 26. 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 D 1 2 TRIF Realty Projects Pvt.08) Tata Consultancy Services Limited Tata Housing Development Company Limited (formerly THDC Limited) Tata International AG.9. Limited) TCS Financial Solutions Australia Pty Limited (Formerly Financial Network Services Pty.2008 ) TCS e-Serve Limited (Formerly Citigroup Global Services Limited) (w.F. Ltd. Ltd. (formerly Unitech Infratech Pvt. 05.09) TRIF Constructions Pvt.2008 ) TATASOLUTION CENTER S.08) TRIF Modern Superstructures Pvt.08) TCE Consulting Engineers Limited Tce QSTP-LLC (W.A.12.E.f.E. (W.F.08) Navinya Buildcon Pvt.07.5.) (W. TRIF Amritsar Projects Private Limited ((W.e.F.E. ) Tata Consultancy Services Chile S.2008 ) Tata Consultancy Services (South Africa) (PTY) Ltd.(formerly Exegenix Canada Inc. 01. Ltd. TRIF Real Estate and Development Pvt.09. 31. ) Tata Consultancy Services Asia Pacific Pte Ltd.E. Ltd. (W.08) Gurgaon Construct Well Pvt.E.E. Limited TCS Iberoamerica SA TCS Inversiones Chile Limitada TCS Italia SRL TCS Management Pty Ltd. Tata Consultancy Services (China) Co.A.E.F.10.08) Gurgaon Realtech Ltd.18. (W. Key Management Personnel (Managing Director) Dr Mukund Govind Rajan (from Feb 28.08) Infiniti Retail Limited (formerly Value Electronics Limited) Nova Integrated Systems Limited (W.30.09. TRIF Structures & Builders Pvt.F.A. Limited Tata Infotech Deutschland GmbH (Ceased to be a subsidiary w. 22.30. Ltd. Ltd.31.F. Ltd. (Formerly TKS .08) TRIF Investment Management Limited Wireless TT Info Services Limited Acme Living Solutions Pvt.e.F.

2009: No. 2008-09 Rs.18 20. their future usability and the fact that these NIUs have been fully depreciated.866 10 (0. Quantitative details of principal items of goods traded (Starter Kits): Quantity Value (Nos. has identified certain Network Interface Units (NIU's).11 0.03 b) As at Mar 31. The Parent Company.0. in Millions Crores FCCB (including redemption premium) 15. at an estimated realisable value of Rs.75 Crores (Net block Rs.91 21. The amounts paid towards the related license fees aggregating Rs. Nil.68 1. 19. in Crores a) Opening Stock 603678 2. Accordingly the said assets were retired from active use and transferred to 'Assets awaiting disposal'. 75 . Accordingly the said NIU's aggregating Rs. 23.610. Derivatives i) Outstanding derivatives: As at Mar 31.4. of which during the current year the Parent Company has written off assets aggregating to Rs.74 66. 2009 169. in Millions Crores 94. have decided to write-off the same. The management.28 407.13.85 a) b) c) ii) Forward Contracts Currency options for hedging of foreign currency exposure Total Interest Rate Swaps Salaries Contribution to Provident and other Fund Monetary value of perquisites Total Note: a) The mark to market loss of outstanding currency options and interest rate swaps as at the year-end aggregate to Rs.06 0.392.20 Crores being not realizable.2.50 479. In Crores) HDFC Cash Mgt Fund Savings Plan Growth 20852562 10 37 ICICI Prudential Institutional Liquid PlanSuper Inst. during the year.50 80.dilutive. 2009 USD in Rs. which have been disconnected and are not in use (including not retrieved) and also have been fully depreciated in the books of account. Currently.28 94. Managerial Remuneration i) Managing Director 2008-09 Rs. of Face Cost Units Value (Rs. 17 Earnings Per Share Data i) ii) iii) iv) Loss after Tax (Rs.66 Crores have been capitalised as intangible 22.77 Crores paid during the year for 2007-08 on account of bonus / performance pay Managerial remuneration for 2008-09 includes Rs. The Parent Company during the previous year.) (Rs. 2009 USD in Rs.) March 31.58 Crores (cost) have been written off during year and removed from the block of fixed assets.0.897.30 479. has been granted approval by DoT for providing telecommunication services using GSM technology under the terms of the existing Unified Access Services Licenses.16 c) Sales 2864615 18.81 Crores (Net Block Nil)}.43 336.) Basic and Diluted Earnings per Share (Rs. Since the erstwhile TDMA technology has become obsolete. aggregating to Rs.94 ii) Non-executive Directors Directors' Sitting Fees 1.90) In calculating the earnings per share the effect of dilution on account of outstanding ESOPs and FCCBs of the Parent Company is ignored since results are anti. having regard to the present condition of the said NIUs.21 b) Purchases 2935085 9. the Parent Company provides fixed wireless telephony services using the erstwhile Time Division Multiple Access (TDMA) technology to certain selected Village Public Telephone (VPT) customers only.16.77 Crores paid to previous Managing Director. the Parent Company has during the previous year decided to dispose off the fixed assets pertaining to TDMA technology except for those being utilized to service the aforesaid VPT Customers. in Crores 1. Growth 7701668 10 10 The Parent Company commenced provision of mobile services using CDMA technology in the year 2003.100.81 80.62 256. The foreign currency exposure that are not hedged by derivative instruments: iii) 2008-09 figures include Rs. in Crores) Weighted average number of shares outstanding Nominal Value of Equity Shares (Rs.368. in Crores 0.1. 18.01 Following units have been purchased and redeemed by the Parent Company during the year ended March 31.78 d) Closing Stock 674148 2.) Rs.64 Crores) {including those lying in capital inventory aggregated to Rs.17 Vendor payables 50.30 Crores in the previous year.

As per information available with the Group. Place : Mumbai Dated: May 11. "Other Income" for the year is higher by Rs. 2009 th Crores and the amount (after the aforesaid adjustments) of Plant and Machinery remaining to be amortised as at March 31.392. 29. 0. In accordance with it's accounting policy. The Charges on the Assets of CITL for Short Term Loan taken from United Bank of India for Rs.88 Crores and the loss for the year is lower by Rs. companies have been given an option to account for exchange differences arising on reporting of long-term foreign currency monetary items (assets/liabilities) in so far as they relate to acquisition of a depreciable capital asset.This. The Parent Company has exercised this option and has given the following effect in the accounts for the aforesaid: a) Exchange gain (net of depreciation) relating to year ended March 31.63 Crores) have been capitalized during the year in accordance with AS 16 on 'Borrowing Costs' and included under Capital Work in Progress. Jani Partner Kishor A. 2008 adjusted in debit balance of Profit and Loss account and Plant and Machinery aggregating to Rs.57 76 . 2007. Signatures to Schedules '1' to '17’ As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants For and on behalf of the Board A. the Parent Company will commence amortization of the license fees paid.45. is not uncommon for telecommunication service providers in their initial years of commercial operations.14 Annual Report 2008-2009 assets. on commencement of GSM operations and will amortise such fees over the remaining life of the respective license. 26. The borrowing costs attributable to the GSM operations aggregating Rs. 2008.66 Crores as license fees for providing services using GSM technology under the existing licenses and expects to rollout the related services during the next financial year. 2006. to be added/ deducted from the cost of the asset and for others to be accumulated in a separate reserve to be amortized over the balance life of the asset/liability but not beyond March 31. 18. 2009 adjusted against carrying value of fixed assets aggregating to Rs. 30.95 Crores. Mukund Rajan (Managing Director) S.45 Crores. amended AS 11 on ´The Effect of Changes in Foreign Exchange Rates´. Maharashtra and Goa Service Area. 2011. Small and Medium enterprises Development Act. 49. Exchange loss relating to year ended March 31. whereby. The Group is consistently making cash profits. Venktesan (Chief Financial Officer) Madhav J. due to high operation costs of heavy infrastructure and high capital requirement for building the network. 130 Crores are in the process of being created. The Parent Company is in advanced stages of financial closure for proposed GSM and other Network Roll out and would be able to meet its further funding requirements. The Parent Company has already been allotted trial Spectrum by DoT for Mumbai Service Area. The accumulated losses of the Group at the close of the year have exceeded its paid-up capital and reserves. the group is confident of it's ability to continue in business as a going concern and the accounts have accordingly been prepared on this basis. The disclosure regarding dues to such creditors is given accordingly in Schedule 11.81 Crores. and "Loss after tax " is lower by the like amount. The aforesaid option is effective with retrospective effect in respect of accounting periods commencing on or after December 7. none of the creditors has confirmed that they are registered under the Micro. Accordingly.63 Crores (Previous Year Rs.B. The Parent Company in the previous year had also paid Rs. Joshi (Chief Legal Officer and Company Secretary) Place : Mumbai Dated: May 11.76 Crores. The appointment of a Manager and a whole time Secretary for the subsidiary Company are under process. The Parent Company acquired CITL in the current year and hence there are no figures on a consolidated basis for the previous year. 28. 25.17. 29.8. vide notification dated March 31. the Parent Company has decided to recognise the upfront (Universal Service Obligation) USO subsidy granted by Department of Telecommunication over the remaining validity period of the scheme/agreement as against the method of recognizing the said revenue over a period of 5 years from the date of receipt from DoT. Based on the foregoing considerations. 2009 b) Due to the aforesaid option exercised by the Parent Company. The Central Government. 27. 2009. 48. and has been able to grow its subscriber base and network. 24. the depreciation for the year is higher by Rs. however. 2009 aggregates to Rs. Chaukar (Chairman) Dr. With effect from April 1.

00) 151. 2009 77 .98) 34.03 (10.47 27.13 0.13 269.33) 421. bank balances in Current and Term Deposit Accounts (Refer Schedule 7 to the Balance Sheet).33 (539.15 600.01) 0.19) (104. 2.22) 1. 2009 Rs.98) Notes to Cash Flow Statement 1.79) 0.03) 36.00) (815.58 769.312. Venkatesan (Chief Financial Officer) Place: Mumbai Date: May 11.73) 463. 2009 Dr. Joshi (Chief Legal Officer and Company Secretary) Place: Mumbai Date: May 11.65) (213.05 (6.21 (55. 3.Jani Partner For and on behalf of the Board Kishor A.99) 1.32 (0.21) 387.62 (806.34 (0. 2009 April 1. As per our attached report of even date For Deloitte Haskins & Sells Chartered Accountants A. in Crores A Cash flows from operating activities Net Loss before tax Adjustments for : Depreciation/Amortisation Loss on Fixed assets sold/written off (Net) Profit on redemption of units (Current Investment) Foreign exchange loss (Net) Finance and Treasury charges (Net) Operating profit before working capital changes Increase in Sundry Debtors Increase in Loans and Advances Decrease in Inventory Decrease in Current liabilities and Provisions Cash Generated from operations Fringe Benefit Tax paid Net Cash generated from operating activities B Cash flow from investing activities Purchase of Fixed Assets Proceeds from sale of Fixed Assets Acquisition in Subsidiary Profit on redemption of units (Current Investment) Purchase of Current Investments Net Cash used for investing activities C Cash flow from financing activities Repayment of Long term borrowings Proceeds from Short term borrowings Repayment of Short term borrowings Proceeds from Acceptance and Cash Credit ( Net) Finance and Treasury charges paid Net cash generated from financing activities Net decrease in cash or cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year (168.83 (1.B. Conversion of Foreign Currency Convertible Bonds into Equity Shares are not considered in the Cash Flow Statement. Purchase of Fixed Assets are inclusive of movements in Capital Work in Progress between the commencement and end of the year.27 (290.CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31. Components of Cash and Cash Equivalents includes Cash.82) 388. 2008 to March 31.Mukund Rajan (Managing Director) Madhav J. Chaukar (Chairman) S.49 (6.42 (51.

2008. 2009 75.14) # # # Prior year figures have not been disclosed in the above statement as the subsidiary was acquired on July 1. Net aggregate amount of profits/(losses) for previous years of the subsidiary. Lakhs) (b) not dealt with in the accounts of the Company for the year ended 31st March. Joshi (Chief Legal Officer and Company Secretary) 78 . Lakhs) 21st Century Infra Tele Limited 31st March. Lakhs) 4. 2008 (Rs.000 Equity Shares of Rs. Financial year of the subsidiary ended on 2.000. For and on behalf of the Board Kishor A.14 Annual Report 2008-2009 Statement pursuant to Section 212 of the Companies Act. Chaukar (Chairman) S. Venkatesan (Chief Financial Officer) Place: Mumbai Date: May 11. related to Subsidiary Companies th Name of the subsidiary 1. Net aggregate amount of profits/(losses) of the subsidiary for the above financial year of the subsidiary so far as they concern members of the Company : (a) dealt with in the accounts of the Company for the year ended 31st March. 2009 (Rs.026. 2008 (Rs. 10 each 100% Nil (1. 2009 Dr. 1956. 2009 (Rs. Lakhs) (b) not dealt with in the accounts of the Company for the year ended 31st March.Mukund Rajan (Managing Director) Madhav J. Shares of the subsidiary held by the Company on the above date: (a) Number Face value (b) Extent of holding 3. since it became a subsidiary so far as they concern members of the Company : (a) dealt with in the accounts of the Company for the year ended 31st March.

They have taken proper and sufficient care.00) 2.560. They have prepared the annual accounts on a going concern basis. Technology Absorption and Foreign Exchange Earnings and Outgo The disclosures as required under the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules. 1956 read with the Companies (Particulars of Employees) Rules. Venkatesan & Mr.00) (337. 1956 these 3. As per the provisions of the Companies Act. 1956.000/divided into 10. Tax and Amortisation (EBIDTA) Finance & Treasury Charges (Net) Depreciation Loss before Extraordinary item and tax Extraordinary item Loss before tax Fringe Benefit tax Loss after tax The Company's Performance As at June 30. 4. 1. 1975. Your directors recommend their reappointment. proposing their appointment as Directors of the Company. Share Capital Total paid-up share capital of the Company is Rs. Financial Results The financial results of the Company's operations during the year are given below: (Amount in Rupees) Directors hold office only upto the date of the forthcoming Annual General Meeting of the Company. Directors Mr. Accordingly. The Directors have pleasure in presenting the 1st Annual Report together with the audited financial statements of the Company for the year ended June 30. The Board recommends these appointments in the interests of the Company. 2008. notes and certificates. Mr. Madhav Joshi. Directors' Responsibility Statement Pursuant to the provisions of Section 217(2AA) of the Companies Act. 1956 and the rules made thereunder.223. 2008. Venkatesan was appointed as an Additional Director with effect from July 3. in respect of the above persons.223. 1988 are given below: 79 . Appropriations No appropriations are proposed to be made for the year under consideration. the Directors confirm that: 1. resolutions seeking the approval of the Members for the appointment of Mr. Shankar Varadharajan was appointed an Additional Director with effect from July 10. Chartered Accountants. Your Company has applied for IP-1 Registration. 2008 and other accompanying reports. the applicable accounting standards have been followed and there are no material departures. and have applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the period. Auditors M/s PKF Sridhar & Santhanam. Madhav Joshi was appointed as First director of the Company. in the selection of the accounting policies. Dividend In view of losses.21ST CENTURY INFRA TELE LIMITED DIRECTORS' REPORT Dear Members. for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. 2008 (42. In the preparation of the annual accounts.e Tata Teleservices (Maharashtra) Limited (TTML). S. Particulars Income Total Income Expenditure Earnings Before Interest.each. S. Once the Registration is obtained.000 equity shares of Rs. They have.00. the present statutory auditors retire at this meeting and are eligible for re-appointment. Mr. the Directors regret their inability to recommend any dividend for the year under consideration. The Company would acquire Passive Tower Infrastructure from its holding Company i.00) (42. for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act. 1956.560. 10/.00) (42. Conservation of Energy. to the best of their knowledge and ability.560.00) (42. The Company has received notices under Section 257 of the Act along with requisite deposit. consulted the Statutory Auditors. the Company would capitalize on the opportunity created by the increased industry focus on infrastructure sharing. Particulars of Employees None of the employees of the Company was in receipt of remuneration which comes under the provisions of the Section 217(2A) of the Companies Act.00) (42. Depreciation. Mr. Fixed Deposits The Company has not accepted any deposits within the meaning of Section 58A of the Companies Act. Shankar Varadharajan as Directors of the Company have been incorporated in the Notice of the forthcoming Annual General Meeting along with brief details about them.

evidence supporting the amounts and disclosures in the financial statements. The Company would make a conscious effort on energy conservation once the operations are started. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement.:205742 th (ii) (ii) (iii) Particulars Earnings Outgo Capital Goods Acknowledgements Current Year Nil Nil Nil (iii) (iv) Your Directors wish to place on record their sincere appreciation of the assistance financial institutions. In our opinion. of the loss for the period 28. An audit also includes assessing the accounting principles used and significant estimates made by management.06. The Company being a private limited Company. 3. We conducted our audit in accordance with the auditing standards generally accepted in India. 2003 issued by the Central Government of India in terms of Sub-Section (4A) of Section 227 of the Companies Act.06. 80 . in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the balance sheet. is not applicable to this Company. the provision of Section 274(1)(g) of the Companies Act. as well as evaluating the overall financial statement presentation. vendors.07 to 30. 1956.06. Ltd. 1956. We believe that our audit provides a reasonable basis for our opinion. 2008. on a test basis. In our opinion.07 to 30. profit and loss account dealt with by this report are in agreement with the books of account. 1956 are not applicable. Our responsibility is to express an opinion on these financial statements based on our audit.08. the balance sheet.No.) 4. 2008. Company’s (Auditors’ Report) Order. in case of the profit and loss account.08. In our opinion and to the best of our information and according to the explanations given to us. 1956.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED (i) Energy Conservation: The Company has not yet commenced its operations. 2008. (b) Place: Mumbai Date: September 1. Foreign Exchange Earnings and Outgo: (Rs. For and on behalf of the Board of Directors (v) (vi) Mumbai Date: October 10.. Further we report that: (i) We have obtained all the information and explanations. For PKF Sridhar & Santhanam Chartered Accountants (Mythily S) Partner M. The Company has not yet established separate R & D facilities. Government and others associated with the activities of the Company. profit and loss account dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act. which to the best of our knowledge and belief were necessary for the purposes of our audit. Technology Absorption: The Company has not imported any technology. the said accounts give the information required by the Companies Act. of the state of affairs of the Company as at June 30. as at June 30. The balance sheet. An audit includes examining.Venkatesan Director Madhav Joshi Director AUDITORS’ REPORT To The Members of 21st Century Infra Tele Private Limited 1. 2008 S. These financial statements are the responsibility of the Company's management. 2. the Profit and Loss account for the period 28. proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.06. We have audited the attached balance sheet of 21st Century Infra Tele Pvt. banks.

2007 TO JUNE 30. 2008 81 .663.BALANCE SHEET AS AT JUNE 30. 2008 As at Schedule 2007-08 Rs.560. 2008 Rs.440.000.000. Income - Schedule June 30.00 Significant Accounting Policies and Notes to Financial Statements 4 Total Significant Accounting Policies and Notes to Financial Statements 100. Joshi Director Director Place: Mumbai Date: September 1. 2008 S.223.00 Loss before Finance and Treasury charges.00 Expenditure Audit Fees Listing Fees 13.560.00 337.483. Depreciation and Tax Finance and Treasury Charges (Net) Depreciation Loss before Tax 42.223.00 Total APPLICATION OF FUNDS Current Assets. 2008 S.00 99. 2008 PROFIT AND LOSS ACCOUNT FOR THE PERIOD FROM JUNE 28.00 28.00 Balance carried to Balance Sheet 42.560. Joshi Director Director Place: Mumbai Date: September 1. Venkatesan Madhav J.740.00 4 As per our attached report of even date For PKF Sridhar & Santhanam Chartered Accountants For and on behalf of the Board As per our attached report of even date For PKF Sridhar & Santhanam Chartered Accountants For and on behalf of the Board Mythily S Partner Place: Mumbai Date: September 1.00 Tax 42. Venkatesan Madhav J. Loans and Advances Bank Balance with Scheduled Bank in Current Account 2 100.00 - Less : Current Liabilities and Provisions Current Liabilities 3 42.00 Loss after tax Balance at Commencement Net Current Assets Profit and Loss Account 57.560.00 42. 2008 Mythily S Partner Place: Mumbai Date: September 1. SOURCES OF FUNDS Shareholders' Funds Share Capital 1 100.00 42.000.

Provision and Contingent Liabilities Provisions are recognized when there is a present obligation as a result of past events where it is probable that there will be outflow of resources to settle the obligation and when a reasonable estimate of amount of the obligation can be made.3 Current Liabilities Acceptances Sundry Creditors Dues to Micro. The Company does not have any derivative transactions.Venkatesan Director Madhav J. The Company is formed to provide passive infrastructure support to telecommunication service provider. 1956.13 (inclusive of service tax) The Company does not owe any moneys to micro and small enterprises as on June 30. Joshi Director Place: Mumbai Date: September 1. the Accounting Standards notified in the Companies (Accounting Standards) Rules 2006 and relevant provisions of the Companies Act. SCHEDULE . As per our attached report of even date For PKF Sridhar & Santhanam Chartered Accountants Mythily S Partner Place: Mumbai Date: September 1. 2.000.2 CASH AND BANK BALANCES Balance with Scheduled Banks in . 2008 82 . 2008. a. 2008 For and on behalf of the Board S.000.each 1.00 99. there are no previous years figures.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT JUNE 30. In Lakhs) Audit fees 0.1 SHARE CAPITAL Authorised 100. 42.000. Contingent liabilities are also recognized when there is a possible obligation arising from past events due to occurrence or non-occurrence of one or more certain future events not wholly within the control of the Company.00 SCHEDULE .each fully paid-up 100.663.00 42.000. 99.00 SCHEDULE .00 1.000. 1956. Payments to Auditors: for the period 28. 2007. when any such present obligation cannot be measured or where a realistic estimate of the obligation cannot be made. th As at June 30. 2008.663. medium and Small Enterprises Others 3.6. Revenue recognition All income and expenditure are accounted for on accrual basis.10/. Significant Accounting Policies Basis of preparation of financial statements The accounts have been prepared to comply in all material aspects with applicable accounting principles in India.223. Company background 21ST CENTURY INFRA TELE PRIVATE LIMITED was incorporated on June 28. 2008 SCHEDULE 4: NOTES TO ACCOUNTS 21ST CENTURY INFRA TELE PRIVATE LIMITED SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO FINANCIAL STATEMENTS 1.00 Issued and Subscribed 10.00 100. This being the first year.f July 1. 2008 Rs.6. contingent liability are recognized.10/.00 4. 6.000 Equity Shares of Rs.The Company has become the wholly owned subsidiary of Tata Teleservices (Maharashtra) Limited w. c. 5. b.000 Equity Shares of Rs.08 (Rs.223.000.Current Accounts (Union Bank of India) d.07 to 30. Accounting basis and convention The financial statement is prepared under historical cost convention on an accrual basis and complies with Section 211 (3C) of the Companies Act.e.

They have. 2008. Rs.32. Depreciation. Authorised & Paid-up Equity Share Capital During the year.026) (1. The current tenancy ratio is 1. Dividend In view of losses. They have taken proper and sufficient care. and the Company's Articles of Associations. to the best of their knowledge and ability. read with the companies (Particulars of Employees) Rules 1975. The Directors recommend their reappointment. Tata Teleservices (Maharashtra) Limited (TTML) sold the passive infrastructure business to the Company on slump sale basis. offer himself for reappointment. Shankar Varadharajan Mr. 2. S. Haridev Khosla as a Director of the Company. Mr. duct space and towers. Madhav Joshi Mr. They have prepared the annual accounts on a going concern basis. Auditors M/s PKF Sridhar & Santhanam. the Directors confirm that: 1. and have applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the period.976 1. Directors' Responsibility Statement Pursuant to the provisions of Section 217(2AA) of the Act. In the preparation of the annual accounts. 10 lakhs to. and the rules made thereunder. the Company obtained Infrastructure Provider Category-1 (IP-1) registration from the Department of Telecommunications (DoT) for establishing and maintaining the assets such as dark fibers. 13. the infrastructure business including assets. 2009 and other accompanying reports. The Directors have pleasure in presenting the 2nd Annual Report together with the audited financial statements of the Company for the period ended March 31. notes and certificates. Audit Committee Members Mr. Technology Absorption and Foreign Exchange Earnings and Outgo The disclosures as required under the Companies (Disclosure 83 . in Lakhs) In accordance with the provision of the Companies Act. 2009. Notice has been received from a member proposing the name of Mr. 1 Lakh to Rs. TTML's GSM project is expected to help Company in rollout of towers significantly. Shankar Varadharajan.DIRECTORS' REPORT Dear Members. Financial Results The financial results of the Company's operations during the year are given below: (Rs.Venkatesan (Invitee) Particulars of Employees None of the employees of the Company was in receipt of remuneration which comes under the provisions of the Section 217(2A) of the Act. consulted the Statutory Auditors. 4. for the maintenance of adequate accounting records in accordance with the provisions of the Act.634 (1. Conservation of Energy. in the selection of the accounting policies. for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. 1956 (Act). Fixed Deposits The Company has not accepted any deposits within the meaning of Section 58A of the Act.500 lakhs. Tax and Amortisation (EBIDTA) Finance & Treasury Charges (Net) Depreciation Loss before Extraordinary item and tax Extraordinary item Loss before tax Fringe Benefit tax Loss after tax 2008-09 1.976 1. Acquisition of Passive Infrastructure Undertaking The holding Company. the Company increased its authorized equity share capital from Rs. 3. liabilities and other obligations effective September 30. Haridev Khosla was appointed as Additional Director with effect from March 25. the Directors regret their inability to recommend any dividend for the year under consideration. Particulars Income Total Income Expenditure Earnings Before Interest. Directors Mr. Sharing of towers The Company is in discussions with all major telecom operators including the new licencees for sharing of towers and improving its tenancy ratios.026) (1.026) Registration for Infrastructure Provider Category with the Department ofTelecommunications During the year. Chartered Accountants.278 698 90 1. Haridev Khosla Mr. the applicable accounting standards have been followed and there are no material departures.000 lakhs and paid up equity capital of the Company from Rs. the present statutory auditors retire at this meeting and are eligible for re-appointment. No Licence fee is payable. Director retire by rotation at the ensuing Annual General Meeting and being eligible. 7.

which to the best of our knowledge and belief were necessary for the purposes of our audit. We conducted our audit in accordance with auditing standards generally accepted in India. the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. Technology Absorption: The Company has not imported any technology. in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: In the case of the Balance Sheet. As required by Companies (Auditor's Report) Order. v. ii. For and on behalf of the Board of Directors 3. The Company regularly reviews power consumption patterns across its networks and implements requisite improvements/changes in the network or processes in order to optimize power consumption and thereby achieve cost savings. we enclose in the Annexure. the said accounts. We have audited the attached Balance Sheet of 21st CENTURY INFRA TELE LIMITED (“The Company”) as at March 31. 2009. 2009 S. th AUDITORS’ REPORT TOTHE MEMBERS OF 21st CENTURY INFRATELE LIMITED 1. read with significant accounting policies and notes thereon. iv. of the state of affairs of the Company as at March31. Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account. give the information required by the Companies Act. a statement on the matters specified in paragraphs 4 and 5 of the said Order. on a test basis. i. vi. (a) 84 . iii. We believe that our audit provides a reasonable basis for our opinion. we report that none of the directors is disqualified as on March 31. In our opinion and to the best of our information and according to the explanations given to us. The Balance Sheet. 2009 from being appointed as a director in terms of clause (g) of Sub-Section (1) of Section 274 of the Companies Act. An audit also includes assessing the accounting principles used and significant estimates made by the Management. An audit includes examining. Foreign Exchange Earnings and Outgo: 2. The Company has not yet established separate R & D facilities. 1956. 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act. 1956. Further to our comments in the Annexure referred to above. banks. proper books of account as required by law have been kept by the Company so far as appears from our examination of those books. evidence supporting the amounts and disclosures in the financial statements. (ii) (Iii) Particulars Earnings Outgo Capital Goods Acknowledgements 2008-09 Nil Nil Nil Your Directors wish to place on record their sincere appreciation of the assistance provided by the financial institutions. the Balance Sheet and Profit & Loss Account dealt with by this report comply with the accounting standards referred to in Sub-Section (3C) of Section 211 of the Companies Act. Mumbai Date: June 24.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED of Particulars in the Report of the Board of Directors) Rules. In our opinion. In our opinion. 1956. 2009 and taken on record by the Board of Directors. Joshi Director 4. Government and others associated with the activities of the Company.Venkatesan Director Madhav J. we report that: We have obtained all the information and explanations. On the basis of written representations received from the directors as on March 31. vendors. 1956. as well as evaluating the overall financial statement presentation. 2009. employees. These financial statements are the responsibility of the Company's Management. 1988 are given below: (i) Energy Conservation: Electricity is used for the working of the Company's network infrastructure equipments. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Our responsibility is to express an opinion on these financial statements based on our audit.

ix.(b) (c) In the case of the Profit and Loss Account. xii. 1956 as none of the directors are holding 2% or more shares of the Company. According to the information and explanations given to us. debentures and other securities.: 206190 Mumbai. v. a) b) ii. of the cash flows for the year ended on that date. of the loss for the year ended on that date. x. a. The Company has not granted or taken any loans. iii. 2003 are not applicable to the Company for the year. xiv. firms or other parties covered in the register maintained under section 301 of the Companies Act. In our opinion and according to the information and explanations given to us. accordingly the clause (x) of the Order is not applicable to the Company. Custom Duty. 500 Lakhs for a period of three consecutive financial years immediately preceding the financial year concerned. dated: May 8. no fraud on or by the Company was noticed or reported during the year. the maintenance of cost records has not been prescribed by the Central Government under Section 209(1)(d) of the Companies Act. xiii. The Company is providing services and not having any inventory. vi. the paid up capital and free reserve as at the commencement of the financial year concerned is not exceeding Rs. xv. no dues of Sales Tax/Income Tax/Custom Duty/Wealth Tax/Service Tax/Excise Duty and Cess have not been deposited on account of any dispute. 1956 and accordingly the sub clauses (a) to (g) of clause (iii) of the Order are not applicable to the Company. and In the case of the Cash Flow Statement. 85 . For PKF SRIDHAR & SANTHANAM Chartered Accountants Radhika Hariharan Partner Membership No. accordingly the sub clauses (a) to (c) of clause (ii) of the order are not applicable to the Company. secured or unsecured to/from companies. in our opinion. 2009 vii. Wealth Tax.: 206190 Mumbai. According to the information and explanations given to us. For PKF SRIDHAR & SANTHANAM Chartered Accountants Radhika Hariharan Partner Membership No. Income Tax. All fixed assets have not been verified by the management during the year but there is a regular program of verification which. 2009 ANNEXURE TO THE AUDITORS’ REPORT Re: 21st Century Infra Tele Limited (Referred to in paragraph 3 of our report of even date) i. viii. Service Tax. No material discrepancies were noticed on such verification. the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act. According to the information and explanations given to us. Sales Tax. According to the information and explanations given to us. including quantitative details and situation of fixed assets. the clause (vii) of the Order is not applicable to the Company. 1956. The Company has not issued any debentures during the year. b. According to the information and explanations given to us. According to the information and explanations given to us. xi. applied during the year for the purpose for which the loans were obtained. According to the information and explanations given to us. Accordingly sub clause (b) of clause (v) of the Order is not applicable to the Company. Cess and any other material statutory dues with the appropriate authorities during the year. In respect of its fixed assets: The Company has maintained proper records showing full particulars. the Company has not given any guarantee for loans taken by others from bank or financial institutions. is reasonable having regard to the size of the Company and the nature of it's assets. c. iv. xviii. Employees State Insurance. In our opinion. According to the information and explanations given to us. 1956. xix. 50 Lakhs and the average annual turnover is not exceeding Rs. the Company has not granted any loans and advances on the basis of security by way of pledge of shares. The Company has been registered for a period less than five years. The nature of the Company's activities is such the clauses (xiii) and (xiv) of paragraph 4 of the Companies (Auditors’ Report) Order. there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to the purchase of fixed assets and sale of services. The Company has not disposed off a substantial part of fixed assets during the year. the term loans availed by the Company were. xvi. and according to the information and explanations given to us. The Company has not accepted any deposits from the public. prima facie. xvii. The Company has not raised any money by way of public issues during the year. the Company has not defaulted in repaying dues payable to a financial institution and banks. According to the information and explanations given to us. During the course of our audit we have not observed any continuing failure to correct major weakness in the internal control system. dated: May 8. no particulars of contracts or arrangements referred in Section 301 of the Companies Act. According to the information and explanations given to us. 1956 are needed to be entered in the register maintained under Section 301 under the Companies Act. in respect of statutory and other dues: The Company has generally been regular in depositing undisputed statutory dues in respect of Provident Fund.

16 (2.200.36 1.000.194.06 Investments Current Assets.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED th BALANCE SHEET AS AT MARCH 31. 2009 Sujir Nayak (Manager) 86 . D.59 0.441.09 2.00 13.301.634.700.00 1.00 As at March 31.00 6 7 8 9 1.00 1.00 1.61) 1.268.026.500.41 0.23 30.00 10.78 3.00 0.072.23 5.847.700.00 1. Loans and Advances Cash at Bank Sundry Debtors Loans and Advances Less : Current Liabilities and Provisions Current Liabilities and Provisions Provisions Net Current Assets Profit and Loss Account Total Significant Accounting Policies and Notes to Financial Statements 13 5 1. 2009 Schedule SOURCES OF FUNDS Shareholders' Funds Share Capital Loan Funds Secured Loan Unsecured Loan Total APPLICATION OF FUNDS Fixed Assets Gross Block Less : Accumulated Depreciation Net Block Capital Work-in-progress 4 31.41 1.180.173. 2009 (Rs in Lakhs) As at June 30. Khosla (Director) S.00 1.666. 2008 (Rs in Lakhs) 1 2 3 7.83 1. Venkatesan (Director) Place: Mumbai Date: May 8.000.55 30.17 29.68 0. 2009 For and on behalf of the Board H.00 As per our attached report of even date For PKF Sridhar & Santhanam Chartered Accountants Radhika Hariharan Partner Place: Mumbai Date: May 8.00 30.

14) (1. 2009 Schedule July 1.41 Profit/(Loss) before Finance and Treasury charges.) Par Value (Rs.976. 2009 Sujir Nayak (Manager) 87 . Depreciation/Amortisation Loss before Tax Tax Loss after tax Balance at Commencement 12 697.026.634. D.) Significant Accounting Policies and Notes to Financial Statements 13 (38. 2007 to June 30.41) Earnings Per Share .PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31.11) 10 As per our attached report of even date For PKF Sridhar & Santhanam Chartered Accountants Radhika Hariharan Partner Place: Mumbai Date: May 8.026.41) (0. 2008 to March 31.41) (0.Basic (Rs. 2009 For and on behalf of the Board H.81 (0. Khosla (Director) S. in Lakhs) Income Infrastructure Sharing Revenue 10 1.55) (0.78 1.17 (1.41) - Balance carried to Balance Sheet (1.41) 89. in Lakhs) June 28. 2009 (Rs.026.278.40) 10 (4.42 0.14) (0.23 - Expenditure Operation and Other Expenses (Net) 11 1. Venkatesan (Director) Place: Mumbai Date: May 8. 2008 (Rs. Depreciation and Tax Finance and Treasury Charges.

.000 (Previous year 10.2 SECURED LOANS From Banks Term Loans (Refer Note 21 of Schedule 13) Notes : 1.00 - 88 . Tower Sharing Agreements. both present and future.each fully paid-up As at June 30.1 SHARE CAPITAL Authorised 130. 2009 As at March 31.10/. both present and future.00 7.000. Loans from Bank are secured.200.00 7.000.by all the rights.00 10.by first pari passu charge on all the intangible assets of the Company.000) Equity Shares of Rs. commissions and receivables of the Company.00 13. 2009 (Rs in Lakhs) SCHEDULE . both present and future. . claims and demands whatsoever by the Company in any letter of credit. title. claims and demands whatsoever in the clearances received. interest.000. etc.10/. operating cash flows.each Issued and Subscribed 75.by assignment of IP-1 licence from DoT.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED th SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31. Lease Agreements.000) Equity Shares of Rs.00 1. . .by first pari passu charge by way of hypothecation over all the movable assets of the Company.00 10. . provided in terms of the project documents. .by pari passu Charge on all the book debts.500.000.000. SCHEDULE . SCHEDULE . interest. guarantee. pending creation of charges. .500. revenues. both present and future.00 Note: All the above Equity Shares are held by Tata Teleservices (Maharashtra) Limited (Holding Company) and its nominees.3 UNSECURED LOANS From Banks Short Term Loans 13.by assignment of insurance policies.00 1.000. etc.00 10.000 (Previous year 100.by first pari passu mortgage and charge over immovable properties of the Company.00 - 10.by all the rights. title. by either one or more of the following as per terms of the arrangements with bank: . 2008 (Rs in Lakhs) 13. benefits.00 13.200. benefits.

198.180.40 452.46 1. 2008 2009 For the period Transfer from Addition Deletion during TTML during the (Refer the Note 3 of period period Schedule 13) Deletions Upto during March 31. 2009 SCHEDULE .666.66 1. 2008 Tangible Assets Plant & Machinery 27.60 - Own Furniture.97 29.634.00 27.633.05 1.633. March 31. 2009 As at June 30.46 29.1. Fixtures & 0.634.68 1.660.98 0.191.17 5.66 .SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31.301.15 726. 2009 the period As at March 31.08 31.83 - Goodwill Previous year Capital Work-In-Progress: 1.32 0. 2008 Upto As at June 30.102. in Lakhs) GROSS BLOCK NET BLOCK DEPRECIATION PARTICULARS As at July 1.26 - Office Equipment Own 89 6.17 - Intangible Assets 0.98 0.23 - Capital advances Capital Inventory Assets Under Construction (Refer Note 18 of Schedule 13) .63 0.10 4.63 6.08 31.15 4.4 FIXED ASSETS (Rs.05 0.294.05 0.32 0.102.

41 0.00 - 1.13 1.33 Lakhs transferred from Tata Teleservices (Maharashtra) Limited (Refer Note 4 of Schedule 13)) SCHEDULE .Quoted ICICI Prudential Liquid Plan Super Inst.84 0.13 554.41 Notes: 1) Advance from Customer is from Tata Teleservices (Maharashtra) Limited (Holding Company) 2) Other liabilities include temperory overdrawn bank balance aggregating to Rs.473. Growth Plan .97 Lakhs (Previous Year NIL) 90 .000. 2008 (Rs in Lakhs) 1.189.09 1.5 Investments Non-Trade Current .00 SCHEDULE .8 LOANS AND ADVANCES (Unsecured .072.441.68 0.Units of Rs 12.194. Sold NIL) As at June 30.09 - SCHEDULE .NIL) (Dividend Reinvested NIL.58 563.194.Considered good) Advances recoverable in cash or in kind or for value to be received Premises and other deposits.36 1.00 SCHEDULE .14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED th SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT MARCH 31.00 1.448. (includes Deposits of Rs.77.518.944 units Previous Year .51 5.637.7 Sundry Debtors (Unsecured .65 2.6 CASH AND BANK BALANCES Balance with Scheduled Banks in . 2009 (Rs in Lakhs) SCHEDULE .Current Accounts - 1.441.01.46 51.16 5.41 0.99 each NAV (During the year .Considered good) Outstanding for a period exceeding six months Others 1.000.9 Current Liabilities and Provisions Sundry Creditors Dues to Micro and Small Enterprises Dues to Others Advance from Customer (Refer Note 1 below) Deposit from Customer Other Liabilities (Refer Note 2 below) Provisions 1. 2009 As at March 31. 425.36 1.78 - 3.

15 0.77 89.11 OPERATION AND OTHER EXPENSES Network Operation costs Repairs and Maintenance . in Lakhs) 1.SCHEDULES FORMING PART OF PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31.23 - SCHEDULE .10 0.89 73.23 1.01 36. 2008 to March 31.78 - 91 .58 Lakhs) (Previous Year NIL) (Refer Note 18 of Schedule 13) Rates and Taxes (Net of recoveries Rs.56 37.99 17.41 53.Plant and Machinery (Including Capital Inventory Consumed Rs.41 - 8.79 1. 2008 (Rs.55 218.10 Income from Infrastructure Sharing Infrastructure Sharing Revenue (Refer Notes 4 and 5 of Schedule 13) June 28. 2007 to June 30. 2.Others Rates & Taxes Legal & Professional Fees Audit Fees Electricity Loss on retirement of Fixed Assets Miscellaneous expenses Payments to and Provisions for Employees Salaries and Bonus (Refer Note 18 of Schedule 13) 2.48 239.12 Finance and Treasury Charges Interest on Short Term Loan Bank Charges 0. 2009 July 1.12 0.976.08 3. in Lakhs) SCHEDULE .976.95 287.24 Lakhs) (Previous Year NIL) Insurance .42 SCHEDULE . 2009 (Rs.00 110.32 5.33 8. 21.52 26.278.29 0.Network Security Charges Others 352.28 Lakhs) Power (Net of recoveries Rs.0.039.64 - Administrative and Other expenses Repairs and Maintenance .59 4.82 Lakhs) (Previous Year NIL) Rent (Net of recoveries Rs. 964.45 0.159.45 1.

The Company has been formed to provide passive infrastr ucture suppor t to telecommunication service providers.33 11. Company Background 21st Century Infra Tele Limited (“Company”) was incorporated on June 28. (c) Fixed Assets Fixed assets are stated at their cost of acquisition or construction. 2006 and relevant provisions of the Companies Act. Capital Inventory comprises tower equipment and accessories that are carried under Capital work-inprogress till such time as they are issued for new installation or as replacement. Assets retired from active use and held for disposal are stated at lower of net book value or net realizable value. July 1. (d) Expenditure related to and incurred during the construction period of cell sites are capitalised as part of the construction cost and allocated to the relevant fixed assets. Significant Accounting Policies (a) Basis of preparation of financial statements The accounts have been prepared to comply in all material aspects with applicable accounting principles in India. Depreciation Fixed Assets are depreciated on a straight line method based on estimates of their useful economic lives: Useful Life (in years) Plant and Machinery . The Company has entered into a Business Transfer Agreement with Tata Teleservices (Maharashtra) Limited (Holding Company) and acquired assets on a Slump Sale as going concern. the Accounting Standards notified in the Companies (Accounting Standards) Rule. 2.f. No. 2007 as a private limited Company. The Department of Telecommunications. The Company has become the wholly owned subsidiary of Tata Teleservices (Maharashtra) Limited (TTML) w. less accumulated depreciation. Ministry of Communication and IT.Goodwill 5 The estimated useful economic life of the infrastructure assets which have been acquired from TTML under Business Transfer Agreement was 12 years from the date of purchase of assets. 2008.Office Equipments 3 . It was converted into public Company on August 25.39 10. 1 2 3 4 5 6 The financial year in which assets originally acquired 2003 – 04 2004 – 05 2005 – 06 2006 – 07 2007 – 08 2008 – 09 upto the date of acquisition Residual useful economic life in years 6. Differences between actual results and estimates are recognised in the periods in which the results are known / materialise. (e) Employee benefits Contributions to the Provident and Superannuation Funds are made in accordance with the rules of the Funds.Network Equipments 12 .73 10.e. Leave encashment and gratuity are provided for on the basis of actuarial valuation as at the end of the period. 2008.e. Cost includes all cost incurred to bring the assets to their working condition and location. The present estimated useful economic life of the said assets is residual useful economic life i.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED SCHEDULES FORMING PART OF THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT SCHEDULE: 13 SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO FINANCIAL STATEMENTS 1. The residual useful economic life is as follows: th Sl. 2008. (b) Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.70 Depreciation on additions and deletions to assets during the period is charged to revenue pro-rata to the period of their use.91 8. (f) Revenue Recognition All income and expenditure are accounted for on accrual basis.The Company has arrived at a single residual useful economic life for the assets originally acquired in a single accounting year on various dates by using weighted average method. Revenue is recognised when it is earned and no significant uncertainty exists as to its ultimate realisation or collection. 1956. Government of India has registered the Company as Infrastructure Provider Category I (IP-I) with effect from September 30. (g) Borrowing costs Borrowing costs attributable to the acquisition of a 92 . the original estimated useful life reduced by the period actually used by TTML.62 8.

304 29. Lease Payments under Operating leases are recognized as expenses as incurred in accordance with the respective Lease Agreements. in Lakhs 1 2 3 4 5 6 Fixed Assets (Towers & Office Equipment) CWIP (including capital inventory) Other Current Assets (Prepaid Rent.qualifying asset. Deferred tax is recognised for all timing differences.667 344 29. 2008 at the end of business hour. The difference of Rs. The BTA provides that the business is being sold as going concern with effect from the effective date i. The list of acquired business assets and liabilities with value are given below. as defined in AS 16 on “Borrowing Costs”. liabilities and other obligations relating to passive infrastructure division on slump sale basis as a going concern from Tata Teleservices (Maharashtra) Limited (“Seller”) as per Business Transfer Agreement (BTA). 1961 is. 3. applying the tax rates that have been substantively enacted by the Balance Sheet date. (m) Impairment of assets An asset is considered impaired in accordance with AS 28 on “Impairment of Assets” when at the balance sheet date there are indications of impairment and the carrying amount of the asset or where applicable the cash generating unit to which the asset belongs. The identifiable acquired Business assets and Liabilities have been recognized by the Company at existing carrying amounts (the value in the books of seller after charging depreciation upto September 30. 2008) which was ascertained & certified by an independent valuer on the effective date. Provision is made if it becomes probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability. exceeds its recoverable amount i. (o) Taxes on Income Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act.e. except where the results are anti dilutive. Deposits) Total Assets Current Liabilities (Retention Money and Creditors) Net Assets 27. 1961. 6. September 30. Investments Investments are stated at lower of cost or net realizable value. (j) Operating Leases Assets taken on Lease under which all significant risks and rewards of ownership are effectively retained by the lessor are classified as Operating Lease. (h) Contingent Liabilities Contingent Liabilities as defined in AS 29 on “Provision.191 1. In assessing the value in use.330 Lakhs (Rupees two hundred ninety three crores thirty lakhs only) which the Company has paid to Seller. Insurance. Contingent Liabilities and Contingent Assets” are disclosed by way of notes to accounts. Sl. The lump sum consideration is Rs. assets / liability Amount Rs. Acquisition of Business relating to passive infrastructure division The Company has acquired the business including its assets.63 Lakhs between existing carrying amounts of assets & liability recognized in the books of the Company and sale consideration is treated as goodwill which shall be amortized in five years at each year end. Maintenance.e. are capitalised as part of the cost of acquisition. 29. Other borrowing costs are expensed as incurred. in accordance with the Guidance Note on Accounting for Fringe Benefits Tax issued by the ICAI regarded as an additional income tax and considered in determination of the profits/(losses) for the period. The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the profit and loss account.323 93 . (l) Earning per share The Company reports basic and diluted earnings per share in accordance with AS 20 on “Earning Per Share”. Diluted earnings per share is computed by dividing the net profit or loss for the period by the weighted average number of Equity share outstanding during the period as adjusted for the effects of all dilutive potential equity shares. (i) Fringe BenefitsTax Fringe Benefits Tax (FBT) payable under the provisions of Section 115WC of the Income Tax Act. subject to the consideration of prudence. Basic earning per share is computed by dividing the net profit or loss for the period by the weighted average number of Equity shares outstanding during the period.172 1. Description of No. the higher of the assets' net selling price and value in use. (k) Cash Flow Statement The Cash Flow Statement is prepared by the indirect method set out in AS 3 on “Cash flow Statement” and present Cash flows by operating. investing and financing activities of the Company. the estimated future cash flows expected from the continuing use of the asset and from its ultimate (n) disposal are discounted to their present values using a pre-determined discount rate.

8. Income : Infrastructure Sharing Revenue Reimbursement of Expenses : Network Expenses Expenses : Salaries on deputation Purchase of Passive Infrastructure Business: . 2008 Rs. (Figures inclusive of Service Tax) 94 .944 10 1. Deferred tax credits have not been recognized as there is no virtual certainty for realization of such credits.00 11. firm or Company concerned. 2009 Advance from Customer Equity share capital as on March 31.) in Lakhs) ICICI Prudential Liquid Plan Super Inst.76 312. after and with effect from the Completion Date carry out and complete for its own account the Business Contracts to the extent that the same have not been performed prior to the Completion Date and in accordance with the terms of the relevant Business Contract. 2008. Sl.f July 1. The Company shall at its own cost. in Lakhs Rs. 2009 June 30.33 13. in Lakhs) Holding Company Tata Teleservices (Maharashtra) Limited 12. Deposit for Cell Site Deposits for Electricity Deposits for Fuel Total 14. 2009 June 30. 10 Lakhs to Rs. Business Contract By virtue of Business Transfer Agreement.61 67. in Lakhs Audit fees 10. none of the creditors have confirmed that they are registered under the Micro. 2008 to March 31.499. The novation or assignment are being executed to the following amounts which are payable and receivable in cash or kind as on balance sheet date and included in the loans and advances in the balance sheet.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED 4. the Company is in the process to get such novation or assignment from parties of the contract as on September 30. in Lakhs For the Period from July 1. The transfer/ execution of new Infrastructure Sharing agreements (currently between TTML and Customers) between the Company and Customers is in progress. in Lakhs) 92. 2008 Rs.740. in Lakhs Rs.00 25. Amount (Rs. The Company is engaged in the business of providing p a s s i ve i n f r a s t r u c t u r e s u p p o r t s e r v i c e s t o Telecommunication Service Provider. These.18) (Rs. 2009 1. Small and Medium Enterprises Development Act.e.669. the right and liabilities with underlying business contracts entered into by TTML and effective on the date of completion of this agreement and thereafter stand transferred to the Company with effect from completion date. in Lakhs Estimated amount of contracts remaining to be executed on capital account and not provided 4. As per information available with the Company. of Face Cost (Rs. 2009 No. 4. in Lakhs Claims against the company not 53. 2009 6. Growth Plan 77. 500 Lakhs on September 19.00 7. The Company has billed Infrastructure sharing revenue in the books of account for the customers as per the commercial information shared by TTML.e. 2006.60 2.46 7.000.90 1.63 7.25 acknowledged as debts As at June 30. 2009 Rs. Particulars No.00 0.96 473.Net Value payable for Slump Sale of Tower Business Assets Equity share capital issued during the period Outstanding as on March 31. Units Value (Rs.189. 2008 Rs. 15. The Company does not have any derivatives transactions. 2008. In so far as the benefit or burden of any of the Business Contracts cannot effectively be assigned to the Company except by an agreement or novation with or by consent to the assignment from the person. Related Party disclosures (in terms of Accounting Standard . 1 2 3 5. in the context of AS 17 on “Segment Reporting” are considered to constitute a single reportable segment. 9. 2009.47 for (net of advances) Contingent liabilities : As at March 31.500. 1.448.900. The Company does not have any foreign currency exposure. 2008 and to Rs. The Company has increased the authorized share capital from Rs.f March 20.12 th Following units (Investments) have been purchased by the Company during the period ended March 31.330. (i) - Note: The Company has become the wholly owned subsidiary of Tata Teleservices (Maharashtra) Limited w. Estimated amount of contract to be executed on capital account and not provided As at As at March 31.00 29.01.300 Lakhs w. Payment to Auditors (excluding service tax): For the period For the period ended ended March 31.

2008 ) Tata Consultancy Services (South Africa) (PTY) Ltd.) Limited Financial Network Services Malaysia Sdn Bhd (Under Voluntary Liquidation) MP Online Limited PT Financial Network Services PT Tata Consultancy Services Indonesia Syscrom S.Tecknosoft S. TRIF Kochi Projects Pvt. TRIL Constructions Ltd. Ltd. 26. Ltd.12. Ltd.12.E.(formerly Unitech Real Tech Ltd.F.E.f. 12.f. (W. Ltd. Tata Sons Limited (Ultimate Holding Company of Tata Teleservices (Maharashtra) Limited) Fellow Subsidiaries Actve Digital Services Pvt Ltd (W.01. TRIF Infrastructure Pvt.E. TRIF Real Estate and Development Pvt. Ltd. 07.08) TRIF Modern Superstructures Pvt.10. Ltd.12.e.18. (W.09.) (W. A Related Party disclosures (in terms of Accounting Standard . Ltd.2008 ) TATASOLUTION CENTER S.29. Ltd.e. 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 TRIF Realty Projects Pvt. De C.08) Tata Capital Housing Finance Limited (W.E. 22.E.A.12. Ltd. Limited Tata Infotech Deutschland GmbH (Ceased to be a subsidiary w. (W. 05.08) Landscape Structures Pvt.e.08) Tata Consultancy Services Limited Tata Housing Development Company Limited (formerly THDC Limited) Tata International AG.30.A. 2009 Holding Company Tata Teleservices ( Maharashtra) Limited.F. Ltd.F.9. 2. Ltd.10. Tata Consultancy Services Deutschland GmbH Tata Consultancy Services Do Brasil Ltda (Formerly Tata Consultancy Services Do Brasil S.2008 ) Tata Consultancy Services Argentina S. Ltd.e.12. Ltd. Limited) TCS FNS Pty.19.E.E. Ltd.08) Gurgaon Construct Well Pvt.F. LLC TCS Financial Solutions Australia Holdings Pty Limited (Formerly Financial Network Services (Holdings) Pty.08) Navinya Buildcon Pvt. Tata Consultancy Services Luxembourg S.E. (formerly Unitech Infratech Pvt. Limited (W.F.) Tata Consultancy Services France SAS (Formerly TKS . 15.F.F.E.09) TRIF Constructions Pvt.E.30.A.E.09. Limited) TCS Financial Solutions Australia Pty Limited (Formerly Financial Network Services Pty.12.f. Ltd.08) Tata Capital Limited (formerly Primal Investment and Finance Limited) Tata Capital Markets Limited Tata Capital Markets Pte. (w.A.F.09.) (W.A.31.04.e.E.08 and Ceased to be a subsidiary w.2008 ) TCS Financial Management.10.E. Tata Consultancy Services (Thailand) Limited (w. Ltd (W. 05. Inc (w.A TCS e-Serve America.30.e.09.f. Ltd. Ltd.K.31.09.F.F.F.30.19.F. TRIF Kolkata Projects Pvt.2008 ) TCS e-Serve Limited (Formerly Citigroup Global Services Limited) (w.F.08) TRIF Erectors Pvt. 17.E.A Tata Consultancy Services Malaysia Sdn Bhd Tata Consultancy Services Morocco SARL AU Tata Consultancy Services Netherlands BV Tata Consultancy Services Portugal Unipessoal Limitada Tata Consultancy Services Sverige AB Tata Consultancy Services Switzerland Ltd. 19. 01.12.F. Financial Network Services (Europe) plc (Ceased to be a subsidiary w. (Formerly TKS .2009 ) TCS e-Serve International Limited (Formerly CGSL International Limited)(w. 21.12.F.F.09. Ltd.08) TRIF Property Development Pvt.31.08) TCE Consulting Engineers Limited Tce QSTP-LLC (W.f.E. Ltd. Limited (W.F.09. TCS Solution Center S.2008 ) Financial Network Services (H.08) Gurgaon Infratech Pvt. Tata Consultancy Services De Espana S.07. Ltd. Zug Tata Internet Services Limited Tata Investment Corporation Limited Tata Limited Tata Pension Management Ltd Tata Petrodyne Limited Tata Realty and Infrastructure Limited Tata Securities Limited Tata Sky Limited Tata Teleservices Limited Tata Trustee Company Pvt.E. Ltd.08) Gurgaon Realtech Ltd. 15. TRIL Airport Developers Ltd.(formerly Exegenix Canada Inc. Tata Consultancy Services (Philippines) Inc. TC Travel And Services Limited (W.09.07. Financial Network Services (Beijing) Co. TRIF Amritsar Projects Private Limited ((W.03. Tata America International Corporation Tata Consultancy Services (Africa) (PTY) Ltd.) (W.f. (W. Limited TCS Iberoamerica SA TCS Inversiones Chile Limitada TCS Italia SRL TCS Management Pty Ltd. (W.F.2008) Computational Research Laboratories Limited Concept Marketing and Advertising Limited e-Nxt Financials Limited Ewart Investment Private Limited Ewart Investments Limited Good Health TPA Services Limited (W. B 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 95 .f.12. 31. (formerly TCS Argentina S..08) Infiniti Retail Limited (formerly Value Electronics Limited) Nova Integrated Systems Limited (W. (W. 31.f.12.08) Tata Capital Pte.31. Pioneer Infratech Pvt.F.2.e.E. TRIF Structures & Builders Pvt.F.E.) Tata Information Technology (Shanghai) Company Limited Tata Infotech (Singapore) Pte.E.E. TRIF Hyderabad Projects Pvt. Ltd. Ltd.E.E.08) Tata Advanced Systems Limited (W.. 11.08) Tata AG.A. (W.e.08) TRIF Gandhinagar Projects Pvt.A.08) TRIF Investment Management Limited Wireless TT Info Services Limited Acme Living Solutions Pvt. (formerly Unitech Construct Well Pvt. (W.E. Tata Consultancy Services De Mexico S. ) Tata Consultancy Services Asia Pacific Pte Ltd.A.18) List of Holding Company and Fellow Subsidiaries of 21st Century Infra Tele Limited as on March 31. 26.F.09. APONLINE Limited C-Edge Technologies Limited CMC Americas Inc CMC Limited Custodia De Documentos Interes Limitada Diligenta Limited Financial Network Services (Africa) (Pty) Ltd. Tata Consultancy Services Belgium SA Tata Consultancy Services BPO Chile SA (Formerly Tata Consultancy Services Chile Limitada) Tata Consultancy Services Canada Inc.09) Ahinsa Realtors Pvt.12. Ltd.12. Ltd.V. TRIF Mega Projects Pvt.12. Ltd.08) Arrow Infra Estates Pvt.E.A.5. WTI Advanced Technology Ltd.15. ) Tata Consultancy Services Chile S. 26.F.F. Ltd.10. TRIL Developers Ltd. Tata Consultancy Services (China) Co.F. Limited (W. Ardent Properties Pvt.08) TRIF Trivandrum Projects Pvt. Zug Tata AIG General Insurance Company Limited Tata AIG Life Insurance Company Limited Tata Asset Management (Mauritius) Pvt Limited Tata Asset Management Limited Tata Business Support Services Limited (formerly E2E SerWiz Solutions Limited) Tata Capital Advisors Pte.Tecknosoft (France) SAS) Tata Consultancy Services Japan Ltd.08) Panatone Finvest Limited Tara Aerospace Systems Limited (W.

in Lakhs - For PKF Sridhar & Santhanam Chartered Accountants For and on behalf of the Board % Place: Mumbai Date: May 8. 21. None of the lease agreements have minimum period clause and are cancelable at will by either party giving a prior notice of 30 to 90 days. 2008 to June 28.March to bring uniformity in line with Tata Teleservices (Maharashtra) Limited (Holding Company) accounting year. in Lakhs - NIL NIL NIL NIL NIL Rent (including maintainence) Total 19.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED 16. 67. end of the period/year Projected benefit obligation. 7. in Lakhs Rs. in Lakhs Salary 4. 2009 June 30.000 10 (4. in Lakhs NIL 1. 2007 to June 30.026. 2009 H. 2008 and current period is July 1. 2009 Radhika Hariharan Partner S.11) iii) NIL iv) NA NA NIL NA NA NA NIL NA NA NA NA NA NA NA 20. 13. Particulars Asset under construction includes the following incidental expenditure incurred during the construction period: Projected benefit obligation.66 74. Previous period relates to a period of June 28. 22.46 2007-08 Rs. Therefore accounting year 2008-09 is for 9 months starting from July 08 to March 09. The disclosure as required under AS 15 regarding the Company's gratuity plan is as follows: As at As at March 31.) Basic and Diluted Earnings per Share (Rs. 2009.28 % 100 100 2007-08 Rs. The Company during the year has changed its accounting year from July . in Lakhs) Weighted average number of shares 2. 23.555 outstanding.40) (0. D. 2008 Rs. 2008 to March 31.)(38.28 0. Nominal Value of 10 Equity Shares (Rs.29) (Rs.47 Lakhs (Previous Year NIL). Earning Per Share July 1. The Charges on the Assets of the Company for Term Loan taken from United Bank of India for Rs. hence the periods are not comparable. NA NA As per our attached report of even date 17 . Venkatesan (Director) Sujir Nayak (Manager) Place: Mumbai Date: May 8.06 NIL (1.000 Lakhs are in the process of being created.50% NA NA 24. Operating Lease: Operating lease rentals charged to revenue during the period are Rs. Khosla (Director) 96 . The appointment of a Manager and a whole time Secretary is under process. 2007 to March 31. 2009 June 30.75% 6. Value of Capital Inventory consumed during the period: 2008-09 Rs.41) NIL NIL NIL NIL NA ii) 10. 2008 i) Loss after Tax (1.672.06) NIL NIL NIL th 18. end of the period/year Fair value of plan assets at the end of the period/year Net liability recognized in the Balance Sheet Fair Value of Plan Assets at the beginning of the period/year Expected Return on Plan Assets Unfunded Liability Benefit Paid Actuarial Gain / (loss) on Plan Assets Fair Value of Plan Assets at the end of the period/year Total Actuarial Loss Recognized Actuarial Assumptions: Discount rate Rate of increase in compensation levels of covered employees Rate of Return on Plan Assets 2008-09 Rs.80 69. in Lakhs Indigenous Total 0.June to April . beginning of the period/year Service cost Interest cost Actuarial gain/(loss) on obligation Benefits paid Projected benefit obligation.

00 1.499.36 0.00 1.79) 3.00 10. Khosla (Director) Sujir Nayak (Manager) 97 .164.00 13.09) (2. 2009 July 1. 2007 to June 30.36 1.45) 595. in Lakhs) A Cash flows from operating activities Net Loss before Extraordinary item and tax Adjustments for : Depreciation Finance and Treasury charges (1.634.78 1.204. Venkatesan (Director) Place: Mumbai Date: May 8.43 (102.CASH FLOW STATEMENT FOR THE PERIOD ENDED MARCH 31.00) (31.723.81 (1. 2009 For and on behalf of the Board S. 2009 H.41) 0.072.22 0.609.00 7.000. 2008 Amount (Rs.95 Operating Profit / (Loss) before working capital changes Increase in Sundry Debtors Increase in Loans and Advances Increase in Current liabilities and Provisions Cash Generated from operations Net Cash generated from operating activities B Cash flow from investing activities Purchase of Fixed Assets Investment Net Cash used for investing activities C Cash flow from financing activities Proceeds on account of shares issued Proceeds from Term borrowings (Secured) Proceeds from Short term borrowings (Unsecured) Finance and Treasury charges paid Net cash generated from financing activities Net (decrease)/increase in cash or cash equivalents Cash and cash equivalents at beginning of the period Cash and cash equivalents at end of the period 697.00 1.000.00 1.36 1.36 June 28.194.41 0.00 Note to Cash Flow Statement Purchase of Fixed Assets is inclusive of Capital Work-in-Progress As per our attached report of even date For PKF Sridhar & Santhanam Chartered Accountants Radhika Hariharan Partner Place: Mumbai Date: May 8.41 (0.22) 0.00 1.22) (1.204.41) 0.14) 1.00 (0.17 89. in Lakhs) (0.026.00 (89. 2009 Amount (Rs.78) 30.200.00) (30. 2008 to March 31. D.

State Code Balance Sheet Date II Capital raised during the period (Rs. Khosla (Director) Sujir Nayak (Manager) 98 . 2009 For and on behalf of the Board Place: Mumbai Date: May 8.847.700.61) 1.002. in Lakhs) Turnover (including other income) Expenditure Loss Before Tax Loss After Tax Earning Per Share (Rs. Venkatesan (Director) H.026.499.026. (ITC Code) Product Description Not Applicable Telecom Infrastructure Service Provider 1.00 01-054651 01 March 31. 2009 S. in Lakhs) (Equity Share Capital & Security Premium Account) Public Issue Rights Issue Bonus Issue Private Placement III Position of Mobilisation and Deployment of Funds (Rs.37 (1.026.14) (38.00 13.55 7.00 30.000.) Dividend Rate V Generic Names of three Principal Products/Services of the Company Item Code No.23 3.00 30.00 7.14) (1.40) 30. in Lakhs) Total Liabilities Total Assets Sources of Funds Paid-up Capital Reserves & Surplus Secured Loans Unsecured Loans Application of Funds Net Fixed Assets (including Capital Work-in-Progress) Net Current Assets Accumulated Losses IV Performance of the Company (Rs. D.976.173.700.500.06 (1.14 Annual Report 2008-2009 21ST CENTURY INFRA TELE LIMITED th BALANCE SHEET ABSTRACT AND GENERAL BUSINESS PROFILE I Registration Details Registration No.

. in the district of ...................... Affix a 15 ps................... Client ID*……………………………………… I/We ....................... August 13 ................ of ................... ..........................................…………………………………………………… ………………………………………………………………………………………….......... or failing him .....2009............………………… Name …………………………………………………………………….….................... T B Kadam Marg.................................. Bajaj Bhavan....................... August 13........... Signed this ............………………………………………………… I certify that I am a registered shareholder / proxy for the registered shareholder of the Company....................................... ATTENDANCE SLIP Fourteenth Annual General Meeting on Thursday...Registered Office: Voltas Premises............................................. Signature ............. 226................................................. Client ID*………………….......................... Chinchpokli............ T B Kadam Marg... Mumbai 400 033..................... * Applicable for investors holding shares in electronic (dematerialised) form..... Revenue Stamp Note: This form in order to be effective should be duly stamped. Mumbai 400 033..... Jamnalal Bajaj Marg....... Folio No………………………………… DP ID*……………………………..... of .…………………………………………………………………………… Note: Please fill in this slip and hand over at the ENTRANCE TO THE AUDITORIUM........ Nariman Point... * Applicable for shareholder(s) holding shares in electronic (dematerialized) form................................................................. 2009..................……………………………………………………………… Address ……………………………………………………………………….............................................................………………………… DP ID*………………………..........................................400 021 at 1500 hours on Thursday.................... Member/Proxy name in Block Letters ………………………………………………......................... Registered Office: Voltas Premises.. in the district of ................. not less than 48 hours before the meeting..... 2009 and at any adjournment thereof........................... 2009 Reg............ as my/our proxy to vote for me/us on my/our behalf at the FOURTEENTH ANNUAL GENERAL MEETING of the Company to be held on Thursday......... August 13................................. I hereby record my presence at the FOURTEENTH ANNUAL GENERAL MEETING of the Company at Kamalnarayan Bajaj Hall & Art Gallery..................day of ......................................................................……………………………………………… Member/Proxy's Signature ………………………. Mumbai ............................................. PROXY FORM Reg.. of .. Folio No……........ in the district of ............................................... being a member/members of the above named Company hereby appoint .................................................………………………………………………………… ………………………………………………………………………………………......... Chinchpokli. completed and signed and must be deposited at the Registered Office of the Company....

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