2 a. No provision is made for one long pending debtor Rs. 33,950,521 (previous year Rs. 33,950,521) in view of the arbitration proceeding completed against the Purchaser for which the Award is received in favour of the Company but has since been challenged by the Purchaser in the court. Further the court remitted back the case to the Arbitrator for speaking orders which also has been awarded in favour of the Company after arguments, cross examinations and written submissions, during the year. The purchaser has again appealed in the Court.

b. No provision is made for Rs. 1,339,656 (previous year Rs. 1,339,656) due from RailTel which was under arbitration. In the Arbitration award, six claims were in favour of the Company and one against the Company. Company has appealed against the award in Delhi High Court and the proceedings are in progress.

3. After restructuring as per the Sanctioned Scheme of BIFR during 2010-11, the net worth of the Company was positive during 2010-11. However during the year 2011-12 the net worth has again eroded. The Company is already under rehabilitation period as per the BIFR Sanctioned Scheme. Lack of executable orders and dull phase of Optical Fiber Cable (OFC) market from the year 2010-11 onwards is the reason for the poor performance. During the year 2012-13 the Company had received order from BSNL for supply of 3206 KMs of OFC valuing Rs.159,701,104 and successfully executed the order in time and got 50% add-on order of 1602 KMs and executed during 2013-14 valuing Rs.79,800,740. These two were the only major orders executed during these two years. Bharat Broadband Network Limited (BBNL), the Special Purpose Vehicle of the Government, had floated the tender towards the National Optic Fiber Network (NOFN) project to connect all the villages by broad band. The date of tender opening was 08.05.2013. Though the initial projection was 600000 KMs, the tender called for is to cover 404995 KMs under six packages based on geographical location. For this huge quantum, BBNL has fixed the delivery time frame of eight months only including initial two months for preliminary arrangements. The Company has participated in one package considering its production capacity to cover the quantum in the given short delivery period. The Company has received APO and given acceptance during February, 2014 for 5800 KMs including accessories. The Value of the APO is Rs. 3,190,44,437. BBNL has proposed to issue PO in two phases of 50% each. During April,2014, BBNL has issued the first 50% PO for 2900 KMs including accessories valuing Rs. 159,527,319. Delivery period was upto October, 2014. BBNL has issued the consignee details in full periodically for four months consignments of 1740 KMs only. For fifth month consignment, consigee details were provided for only 48 KMs out of 580 KMs. Hence consignee details are not provided for balance around 1112 KMs. BBNL has extended the delivery schedule by another six months beyond October,2014. Hence the supply of balance around 1112 KMs and second 50% PO for 2900 KMs may be anticipated during 2015-16 for execution. The Company has participated in the tender floated by BSNL for supply of 24,000 KMs of 24F HDPE DS OFC. The technical bid opened and the company has been technically qualified. Financial bid opened on 21.5.2015 and is under evaluation, which will be followed by e- reverse auction. Company is hopeful of getting orders around 2500 KMs which is projected to be executed during 2015- 16. The requirement of OFC in the country is huge; however the delay in procurement is due to various procedural matters / issues in execution of big projects by the Government Clients. The Company is hoping to get continuous orders from 2015-16 onwards regularly since the OFC market is picking up. The order booking position is expected to be continuously good. Considering the scope during the immediate future and TCIL's continuous financial support, the accounts have been prepared on going concern basis.

4 Land: The Company is in possession of free hold land from Chennai Metropolitan Development Authority (CMDA) and the Tamilnadu State Government measuring around 9.82 acres. In case of sale of CMDA land by the company it has to be first offered to CMDA at the same purchase price. The land can be sold to other third parties only after getting No Objection Certificate (NOC) from CMDA. In the case of Tamilnadu State Government land it is to be utilized for the purpose for which it is allotted and surplus land if any, has to be surrendered.

5 As per Accounting Standard 15 "Employee Benefits", the disclosures of Employee benefits as defined in the Accounting Standard are given below:

A) Defined contribution Plan

Upto the year 2008-09 the Company has set up separate Trust for Provident Fund and has been contributing towards the same. In view of the fact that the Company is industrially sick as declared by BIFR and its net worth has fully eroded, the Provident Fund Commissioner-I has withdrawn with effect from 01.04.2009 the relaxation order issued under Para 79 of the Employees' Provident Fund Scheme 1952, with a direction to remit the whole cash balance to Employees' Provident Fund (EPF) Account No.1 and the balance available in Special Deposit Account to Central Board of Trustees, Employees' Provident Fund. During the year the Company has followed the directions of the Provident Fund Commissioner- I and remitted the monthly contributions to the concerned Regional Provident Fund Commissioner.

B) Defined Benefit Plan

Gratuity (Un Funded) :

The Company provides for gratuity, a defined benefit retirement plan (the "Gratuity Plan") covering eligible employees. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee's salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as of the balance sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method.

The following table set out the status of the gratuity plan as required under AS 15

Note: The estimates of rate of escalation in salary considered in actuarial valuation, taken into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is based on the valuation certified by the actuary.

C) Leave encashmentThe employees of the Company are entitled to compensated absence. The employees can carry forward a portion of the unutilized accrued compensated absence and utilize it in future periods or receive cash compensation at retirement or termination of employment for the unutilized accrued compensated absence for a maximum of 240 days. The Company records an obligation for compensated absences in the period in which the employee renders the services that increase this entitlement. The Company measures the expected cost of compensated absence as the additional amount that the Company expects to pay as a result of the unused entitlement that has accumulated at the balance sheet date based on actuarial valuations.

6 a) Current Tax: No provision for income tax is made in view of the current year loss and the accumulated losses of previous years available for set off.

b) Deferred tax: During the year the Company has not accounted/taken the credit/charge for the deferred tax assets/liabilities. The excess of timing difference over the deferred tax liability has been ignored for want of reasonable certainty of the company making taxable income in the near future. Similarly, for the same reason, certain other provisions made in the earlier years have been ignored for creation of deferred tax asset. The accumulated losses and carried forward depreciation under the tax laws have been ignored for creating the deferred tax asset considering that there is no reasonable certainty of the company making taxable income in the future in terms of para 26 of AS-22.

The treatment noted above is in accordance with the Accounting Standard 22 "Taxes on Income" notified under Section 133 of the companies Act, 2013.

7 Work-in-Progress under Inventories as on 31.03.2015 includes realizable scrap comprising short length cables, quality defects cables, excess production cables for operational reasons, type approval cables and disputed returned cables valuing Rs.5,116,178 (previous year Rs. 13,867,175). The above items are saleable with further processing and re- testing to the same or other customers.

8 As stipulated in AS - 28, the company is of the view that assets employed in continuing business are capable of generating adequate returns over their useful life in the usual course of business. There is no indication to the company of impairment of any asset and accordingly the Management is of the view that no impairment provision is called for during the year.

9. The Company had undertaken on test basis during 2012-13, a new venture of assembling and supply of Tablet PCs to one of the promoters, Telecommunications Consultants India Limited (TCIL), towards TCIL's CSR Project of supplying 150 nos. of Tablet PCs to 10 State Government Schools in Vellore district of Tamilnadu. The project was successfully executed during 2012-13. No further business on this front,during the year 2014-15.

10 CONTINGENT LIABILITIES

(a) Claims against the company not acknowledged as debt:

(i) Commercial Ta x Department had demanded a sum of Rs.18,608,794 as Additional Sales Ta x in respect of Financial Year 2000-2001 and 2001-2002 (up to November 2001). The company has obtained a Stay from Madras High Court against the collection of above demand by depositing a sum of Rs.7,500,000 with Commercial Tax Department as directed by the High Court while granting the stay. As the demand is disputed, the same is not provided for in the accounts. The case came up for hearing during November, 2011and directions were issued to post the case along with the writ appeal before the Bench in another similar case where the judgement is in favour of the assessee.

(ii) The Sales Ta x department has demanded a sum of Rs. 2,295,000 during the financial year 2006-07 for non submission of "C" Forms from BSNL / MTNL pertaining to AY 2001-02, 2002-03 and 2003-04. The Government has exempted "C" forms in respect of inter-state sales to BSNL / MTNL. The company has represented to the Department and also referred the matter to BSNL / MTNL.

(iii) The Customs Authority has demanded an amount of Rs. 3,155,226 towards difference in classification of Optical Fibre during the year 2006-07. However the order of the Commissioner of Customs has come in favour of the Company during the year 2009-10 dropping the proceedings. Department has gone for appeal against the order.

(b) Guarantees:Guarantees arranged by TCIL in favour of the Company and issued by Banks outstanding as at March 31, 2015 is Rs.108,494,216 including expired Bank Guarantees to the extent of Rs.11,717,894 (previous year Rs.142,139,028 including expired Bank Guarantees to the extent of Rs. 10,874,154 )

11 Commitments

(a) Estimated amount of Contracts remaining to be executed on Capital Account and not provided for during the year is Rs. 'Nil' (previous year Rs. 'Nil')

(b) Uncalled liability on shares and other investments which are partly paid up during the year is Rs.'Nil' (previous year Rs.'Nil')

12 The Company has no long term operating lease. No financial lease has been availed during the year

13 A demand was raised by Income Tax Department towards tax to be deducted at source on Royalty amounting to Rs.2,542,165 (for the years 2000-01 & 2001-02). The company, has however, paid the entire amount of demand, out of which Rs. 2,193,733 is kept as recoverable. Appeal filed by the company for the above is pending in the Tribunal.

14 A writ petition has been filed by the Company in Madras High Court during the year 2008 against BSNL for reducing the awarded rate during the scheduled delivery period, in one of their orders without giving effect to BSNL's amendment to the 'Fall clause' applicable from 01.08.2005. BSNL has rejected and returned the differential claim invoice of the company for Rs.13,991,251. The case is pending in Madras High Court.

15 Figures of previous year have been regrouped / rearranged, wherever necessary, to conform to the current year's classification.

16. Applicability of Companies Act, 2013:Since it is notified as per General Circular No. 8/2014 dated 04.04.2014 issued by Ministry of Corporate Affairs that the financial statements as per Companies Act, 2013 is applicable with effect from Financial Year commencing from 01.04.2014, the financial statements have been prepared as per the Companies Act, 2013.

17. There was a fire incident in the store yard of the factory on 12.01.2015 and most of the WIP inventories, part of external portion of factory building, minor part of Plant & machinery including electrical installations got damaged. Insurance claims lodged with the Insurer. The total insurance claim lodged for Rs.74,723,904. Out of this, the cost of damaged WIP inventories excluding excise duty and salvage value Rs.62,386,677 and reimbursement of actual expenditures incurred during the fire incident Rs. 83,917 only have been accounted as insurance claims receivable under 'Other Current Assets' with credit to 'Other Income'. The corresponding stock value of the damaged WIP reduced from the WIP inventories. For other claims, the same shall be accounted as per expenditure incurred / insurance claims settled. The claim amount being huge, the insurance claim settlement process takes time. However, based on the surveyor's interim report, the insurer has made provisions towards this claim to the extent of Rs.64,000,000.

18. a) A civil suit has been filed by the company in Delhi High court on 31.03.2011 to stay the Advance Purchase Order issued by BSNL, HQ for supply of 42000 KMs of OFC. This is in addition to the purchase order issued during January, 2011 for supply of 18000 KMs. The order for OFC supply is with Nylon 12 jacketing and subsequently BSNL has changed the specification with HDPE Double sheathing. During the year 2011-12 BSNL has floated tender for 42000 KMs with the new specification. The case in Delhi High Court against the APO is in progress. b) The Company had taken up with BSNL for short closure of the PO for supply of 18000 KMs or to invoke the Arbitration clause. During the year the Arbitration clause has been invoked and arbitration proceedings are in progress.

19. The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence the disclosure relating to amounts unpaid as at the year end together with interest paid / payable under this Act could not be ascertained

20. Related Party Disclosures : Disclosures as required by the Accounting Standard 18 "Related Party Disclosures" are as given below:

List of Related Parties:

Associate Companies 1. Fujikura Ltd., Japan, Technical Collaborator & Equity Partner

2. Telecommunications Consultants India Ltd., New Delhi, Equity Partner

Key Managerial Personnel 1. Shri.V.S.Parameswaran, Managing Director

2. Shri.V.Mohan, Group General Manager (Finance)

* Movement in balance includes exchange rate fluctuation ** Includes only Shri.V.S.Parameswaran, Managing Director