IIT Investrust Limited

DIRECTORS' REPORT

Dear Members

Your Directors have pleasure in presenting the 21st Annual Report of the Company together with the audited accounts for the 9th month accounting period ended 31st, March, 2015

Review of operations

Performance during the 9 month accounting period ended 31.03.2015

Your company has made a Revenue of Rs.2365.13 Lakhs during the 9 months accounting period ended 31st March, 2015, as compared to the turnover of Rs.5748.06 Lakhs during the 12 month period ended on 30th June 2014 and incurred a net loss of Rs. 34308.36 Lakhs during the 9 months accounting period as against the net loss of Rs. 62039.40 Lakhs previous 12 months accounting period ended 30.06.2014. The revenue collections from the State Electricity Boards has continued to be decreased drastically on account of non-availability of timely funds for the completion of the projects., due to bad collections from the State Electricity Boards and on account of not providing funds by the banks. Also the decline in the performance is on account of slowdown of the economy with respect to the Infrastructure Sector. The detailed analysis of the performance, given at the management's discussion and analysis section of the Annual Report.

Changes in capital structure

There is no change in the capital structure of the company during the accounting period.

FCCBs

Out of USD 46 million FCCBs issued by the Company, USD 25 million FCCBs were converted into equity upon exercise of conversion rights by bond holders in the earlier years and an amount of USD 21 million FCCBs were outstanding and due for redemption as at the previous accounting year. The trustee for FCCB holders has filed suit u/s.433 & u/s.434 of the Companies Act, 1956 for winding up of the company, which has been disposed off in Company favour.

Subsidiary

The Company has floated a new India based subsidiary during the year 2011-12, named ICSA Infra Limited. Since it is into inception stage, there was no transaction in the company during the accounting period.

Dividend

In view of the losses, your Directors decided not to recommend any dividend for the financial year under review.

Fixed deposits

Your Company has not accepted any deposits falling within the meaning of Sec. 76 of the Companies Act, 2013 and any other applicable provision read with the Companies (Acceptance of Deposits) Rules, during the financial year under review.

Insurance

The Company's properties and assets are adequately insured, wherever required.

Directors' responsibility statement

As required under Section 134(5) of the Companies Act, 2013 and any other applicable provisons of the act Directors of your company hereby state and confirm:

1. That in the preparation of the annual accounts for the 9 months accounting period ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures

2. That We have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the 9 months accounting period ended March 31, 2015 and of the Loss of the Company for the year under review

3. That We have taken proper and sufficient care for maintain of adequate accounting records in accordance with provisions of the Companies Act, 1956, for safeguarding the Company's assets and for preventing and detecting fraud and other irregularities

4. That We have prepared the accounts for the 9 months accounting period ended March 31, 2015 on a going concern basis

Directors

In accordance with the provisions of Section 160 of the Companies Act, 2013, Mrs. G. Lalitha (DIN 02198243)was appointed as Additional Director (Woman Director) wef 19th March, 2015 in a duly constituted Board Meeting. A request has been received by one of the members of the Company to appoint retires by rotation and being eligible, has offered himself for reappointment.

Appointment of Secretarial Auditor

Dr. Mohan S Rao, Practising Company Secretary is appointed as a Secretarial Auditor for the conduct of the Secretarial Audit for the financial year 2014-15.

Auditors

The appointment of M/s. Rambabu & Co, Chartered Accountants, Hyderabad, Independent Auditors of the Company retiring at the forthcoming Annual General Meeting and are being ratified as they were appointed for a period of five years in the 20th AGM held on 22 Dec 2014. In accordance with the Companies Act 2013, it is proposed to appoint them for a period of three consecutive years of the first term of five consecutive years, subject to the ratification of shareholders at every Annual General Meeting and M/s. Rambabu & Co, Chartered Accountants, Hyderabad, have confirmed that the appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013.

Response to Auditors Observations

With reference to the observations made by the Statutory Auditors in the Audit Report, the management response there to as follows:

i) Attention is invited to Note No.7 to Notes on Financial statements regarding non-provision of interest on working capital loans for an amount of Rs. 8729.68 lacs. The loss of the company is understated to an extent of Rs.8729.68 lacs and the liability of the company is understated to that extent.

Management Response:

The company has been declared sick u/s.3(o) of SICA as per the order pronounced by the Hon'ble BIFR on 12.02.2014.Later banks have issued SARFAESI Act 2002 against which Hon'ble BIFR has stayed the actions of banks.

The company also has given revised DRS proposal to the banks which is pending. Hence interest is not provided.

ii) Attention is invited to Note No.9 to Notes on Financial statements regarding non-provision of interest on Term Loans from banks for an amount of Rs.7,471.83 lacs. The loss of the company is understated to an extent of Rs.7,471.83 lacs and the liability of the company is understated to that extent.

Management Response:

The company has been declared sick u/s.3(o) of SICA as per the order pronounced by the Hon'ble BIFR on 12.02.2014. Later banks have issued SARFAESI Act 2002 against which Hon'ble BIFR has stayed the actions of banks.

The company also has given revised DRS proposal to the banks which is pending. Hence interest is not provided.

iii) Attention is invited to Note No.9 to Notes on Financial statements regarding non-provision of interest on corporate dividend tax for an amount of Rs.64.24 lacs which was provided for the financial year 2010-11. The loss of the company is understated to an extent of Rs.64.24 lacs and the liability of the company is understated to that extent.

Management Response:

The company also has given revised DRS proposal to the banks which is pending. Hence interest is not provided.

iv) Attention is invited to Note No.25 (a) (iii) to Notes on Financial statements regarding non-provision of Rs. 6427.58 lacs, towards differential interest for non acceptance of CDR package by banks. The loss of the company is understated to an extent of Rs. 6427.58 lacs and the liability of the company is understated to that extent.

Management Response:

The company also has given revised DRS proposal to the banks which is pending. Hence interest is not provided.

Reference to Board for Industrial and Financial Reconstruction (BIFR)

The Board of Directors at their meeting held on 29th August 2013 approved to make a reference to the Hon'ble Board for Industrial and Financial Construction (BIFR) u/s.15 Sick Industrial Companies (Special Provisions) Act, 1985. The information was already placed in the 20th Annual General Meeting held on 22nd December, 2014. Company has made a reference to the Hon'ble BIFR on 10th September 2013 and reference has been registered on 15th October 2013 as case no.70/2013. The company was declared sick u/s.3(o) of SICA as per the order pronounced by the Hon'ble BIFR on 12.02.2014.

As per the directions of the Hon'ble BIFR, the company has submitted the Draft Rehabilitation Package (DRS) to the State Bank of India, the Operating Agency (OA) and other banks on 25.03.2014.

The OA has appointed the consultant for the study of the TEV, who will submit the report, after getting the report; the Bankers will have a joint Lenders Meeting and will forward their recommendations to the Hon'ble BIFR.

Meanwhile the Banks have issued SARFAESI notice on 16.10.2014; the Hon'ble BIFR has given stay against the SARFAESI on 27.11.2014.

Employees

During the year under review, none of the employees were in receipt of remuneration in excess of the limits prescribed under the Section 197(12) of the Companies Act, 2013 and any other applicable provisons of the act read with rule 5(1) of Companies (Appointment and remuneration of managerial personal) Rules 2014 as amended.

Listing of Securities

The Company's equity shares are listed with the Bombay Stock Exchange Ltd. and the National Stock Exchange. The annual listing fee for the years 2014-15 and 2015-16 have been paid to these exchanges.

Corporate Governance and Shareholders' Information

Your Company has been practicing the principles of good Corporate Governance over the years and it is a continuous and on-going process. A detailed Report on Corporate Governance is given as Annexure 'A' to this Report. Certificate from Practicing Company Secretary confirming the compliance with conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this report.

Employee stock options

The time period for schemes of employee stock options has expired and no shares have been allotted to the employees during the year. As the time period has expired the Deferred Employee Compensation no longer required and the same has been reversed to the Reserves.

Management Discussion & Analysis:

Pursuant to the provisions of Clause 49 of the Listing Agreement with the stock exchange, a report on Management Discussion & Analysis is attached to this report.

Conservation of energy, technology absorption, foreign-exchange earnings and outgo

Information as required to be furnished under the provisions of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are as hereunder:

Conservation of energy

Energy conservation measures taken up:

ICSA uses electrical energy for its equipment such as air-conditioners, computer terminals, lighting and utilities at work places. As an on-going process, we continue to undertake the following measures to conserve energy- Incorporating new technologies in the air-

conditioning system of the upcoming facilities to optimize power consumption

- Identifying and replacing low-efficient machinery (AC) in a phased manner

- Identifying and replacing outdated and low-efficient UPS systems in a phased manner

The Company also has in place the internal control procedures by which the cost of the electricity will be identified with the project and thereby, there will be an incentive for the concerned department to consume optimum power.

Additional investment and proposals for reduction of consumption of energy: Nil.

Total energy consumption requirement: Not applicable, as the Company is not engaged in any of the specified industries specified in Schedule 1 to the Companies (Disclosures of Particulars in the Report of the Board of Directors) Rules, 1988.

Research and Development

The Company is committed to continue its efforts in Research and Development. Our Research and Development activities will help us gear up for future opportunities. We invest and encourage continuous innovation.

Technology absorption, adoption and innovation

Efforts made in technology absorption: Enclosed - Form 'B

Acknowledgements

Your Directors are thankful to all investors, customers, vendors, banks and service providers as well as regulatory and government authorities and other business constituents for their assistance, co-operation, understanding, support and encouragement. Your Directors also sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees at all level in the initiatives of the Company.

By the order of the Board of Directors

for ICSA (INDIA) LIMITED

Sd/- G. Bala Reddy

Chairman-cum-Managing Director

Place: Hyderabad

Date: 26th August 2015