1. Corporate Information:

Tech Mahindra Limited (referred to as "TechM" or the "Company") operates mainly into two sectors i.e. Telecom business and Enterprise Solutions business. The telecom business provides consulting-led integrated portfolio services to customers which are Telecom Equipment Manufacturers, Telecom Service Providers and IT Infrastructure Services, Business Process Outsourcing as well as Enterprise Services (BFSI, Retail & Logistics, Manufacturing, E&U, and Healthcare, Life Sciences, etc.) of Information Technology (IT) and IT-enabled services delivered through a network of multiple locations around the globe. The enterprise solutions business provides combrhensive range of IT services, including IT enabled services, application development and maintenance, consulting and enterprise business solutions, extended engineering solutions and infrastructure management services to diversified base of corporate customers in a wide range of industries including insurance, banking and financial services, manufacturing, telecommunications, transportation and engineering services. The Company's registered office is in Mumbai, India and has over 140 subsidiaries across the globe.

2. Significant accounting policies:

2.1 Basis for brparation of financial statements:

These financial statements have been brpared in accordance with the Generally Accepted Accounting Principles in India on accrual basis under the historical cost convention, except for certain financial instruments which are measured at fair value. These financial statements have been brpared in accordance with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. The accounting policies adopted in the brparation of the financial statements are consistent with those followed in the brvious year.

2.2 Use of Estimates:

The brparation of financial statements requires the management of the company to make estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of financial statements, disclosure of contingent liabilities as at the date of the

financial statements, and the reported amounts of income and expenses during the reported period. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the financial statements.

2.3 Tangible Fixed Assets and Intangible assets:

Tangible fixed assets and intangible assets are stated at actual cost less accumulated debrciation and net of impairment. The actual cost capitalised includes material cost, freight, installation cost, duties and taxes, eligible borrowing costs and other incidental expenses incurred during the construction / installation stage.

2.4 Debrciation / amortization of fixed assets:

Debrciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value. Debrciation / amortisation on fixed assets including assets taken on lease, other than freehold land is charged based on straight line method on an estimated useful life as brscribed in Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed as under based on technical advice, considering the nature of the asset, estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support, etc.

The estimated useful life of the intangible assets are reviewed at the end of each reporting period to reflect the changed pattern, if any.

The cost of software purchased for internal use is capitalized and debrciated in full in the month in which it is put to use.

Project specific intangible assets are amortised over their estimated useful lives on a straight line basis or over the period of the license, whichever is lower.

2.5 Leases:

Assets taken on lease are accounted as fixed assets where necessary conditions are complied in accordance with Accounting Standard 19 on "Leases", (AS 19).

i. Finance lease:

Where the Company, as a lessor, leases assets under finance lease, such amounts are recognised as receivables at an amount equal to the net investment in the lease and the finance income is based on constant rate of return on the outstanding net investment.

Assets taken on finance lease are accounted as fixed assets at fair value. Lease payments are apportioned between finance charge and reduction of outstanding liability.

ii. Operating lease:

Lease arrangements under which all risks and rewards of ownership are effectively retained by the lessor are classified as operating lease. Lease rental under operating lease are recognised in the Statement of Profit and Loss on a straight line basis over the lease term.

iii. Sale and Lease back transaction :

In case of a sale and leaseback transaction resulting in a finance lease, any excess or deficiency of sales proceeds over the carrying amount is deferred and amortised over the lease term in proportion to the debrciation of the leased asset.

Profit or Loss on Sale and Lease back arrangements resulting in finance leases are recognised, in case the transaction is established at fair value, else the excess over the fair value is deferred and amortised over the period for which the asset is expected to be used.

2.6 Impairment of Assets:

The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment if any indication of impairment exists. The following intangible assets are tested for impairment each financial year even if there is no indication that the asset is impaired:

(a) an intangible asset that is not yet available for use; and

(b) an intangible asset that is amortised over a period exceeding ten years from the date when the asset is available for use.

If the carrying amount of the assets exceed the estimated recoverable amount, an impairment is recognised for such excess amount. The impairment loss is recognised as an expense in the Statement of Profit and Loss, unless the asset is carried at revalued amount, in which case any impairment loss of the revalued asset is treated as a revaluation decrease to the extent a revaluation reserve is available for that asset.

The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their brsent value based on an appropriate discount factor. When there is indication that an impairment loss recognised for an asset (other than a revalued asset) in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, to the extent the amount was brviously charged to the Statement of Profit and Loss. In case of revalued assets such reversal is not recognised.

2.7 Investments:

Investments which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties. If an investment is acquired, or partly acquired, by the issue of shares or other securities, the acquisition cost is the fair value of the securities issued.

Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the Statement of Profit and Loss.

2.8 Inventories:

Components and parts:

Components and parts are valued at lower of cost or net realizable value. Cost is determined on First-In-First Out basis.

Finished Goods:

Finished goods are valued at the lower of the cost or net realisable value. Cost is determined on First-In-First Out basis.

Projects in Progress / Work in Progress:

Hardware equipment and other items are carried at the lower of cost and net realisable value. Cost is determined on a specific identification basis. Cost includes material cost, freight and other incidental expenses incurred in bringing the inventory to the brsent location / condition.

2.9 Revenue recognition:

Revenue from software services and business process outsourcing services include revenue earned from services rendered on 'time and material' basis, time bound fixed price engagements and system integration projects.

All revenues from services, as rendered, are recognised when persuasive evidence of an arrangement exists, the sale price is fixed or determinable and collectability is reasonably assured and are reported net of sales incentives, discounts based on the terms of the contract and applicable indirect taxes.

The Company also performs time bound fixed price engagements, under which revenue is recognised using the proportionate completion method of accounting, unless work completed cannot be reasonably estimated. Provision for estimated losses, if any on uncompleted contracts are recorded in the period in which such losses become probable based on the current estimates and can be reasonably estimated.

The cumulative impact of any revision in estimates of the percentage of work completed  is reflected in the period in which the change becomes known.

Revenue from maintenance contracts is recognised over the period of the contract in accordance with its terms.

Revenue recognition is based on the terms and conditions as per the contracts entered into with the customers. In respect of expired contracts under renewal or where there are no contracts available, revenue is recognised based on the erstwhile contract / provisionally agreed terms and/or understanding with the customers.

Revenue is net of volume discounts / price incentives which are estimated and accounted for based on the terms of the contracts and excludes applicable indirect taxes.

Amounts received or billed in advance of services performed are recorded as advances from customers / unearned revenue.

Unbilled revenue rebrsents amounts recognised based on services performed in advance of billing in accordance with contract terms and is net of estimated allowance for uncertainties and provision for estimated losses.

Liquidated damages and penalties are accounted as per the contract terms wherever there is a delayed delivery attributable to the Company and when there is a reasonable certainty with which the same can be estimated.

Revenues from the sale of software and hardware products are recognised upon delivery / deemed delivery, which is when title passes to the customer, along with risk and rewards.

Reimbursement / recoveries from customers are separately identified as contractual receivables when no significant uncertainty as to measurability or collectability exists.

The Company recognizes unearned finance income as financing revenue over the lease term using the effective interest method.

Dividend income is recognised when the Company's right to receive dividend is established. Interest income is recognised on time proportion basis.

2.10 Government grants:

Government grants are recognised when there is reasonable assurance that the Company will comply with the conditions attached to them and the grants will be received

Government grants whose primary condition is that the Company should purchase, construct or otherwise acquire capital assets are brsented by deducting them from the carrying value of the assets. The grant is recognised as income over the life of the debrciable asset by way of reduced debrciation charge. Grants in the nature of capital subsidy are treated as capital reserve based on receipt/eligibility.

Grants related to revenue are accounted for as other income in the period in which the related costs which they intend to compensate are accounted for to the extent there is no uncertainty in receiving the same. Incentives which are in the nature of subsidies given by the Government which are based on the performance of the Company are recognised in the year of performance / eligibility in accordance with the related scheme.

Government grants in the form of non-monetary assets, given at a concessional rate, are accounted for at their acquisition costs.

2.11 Foreign currency transactions:

(i) Foreign currency transactions and translations:

Transactions in foreign currencies are recorded at the exchange rates brvailing on the date of transaction. Monetary items are translated at the period end rates. The exchange differences between the rate brvailing on the date of transaction and on the date of settlement / translation of monetary items at the end of the period is recognised as income or expense, as the case may be.

Any brmium or discount arising at the inception of the forward exchange contract is recognised as income or expense over the life of the contract, except in the case where the contract is designated as a cash flow hedge.

(ii) Derivative instruments and hedge accounting:

The Company uses foreign currency forward contracts / options to hedge its risks associated with foreign currency fluctuations relating to certain forecasted transactions. Effective April 1st, 2007 the Company designates some of these as cash flow hedges applying the recognition and measurement principles set out in the Accounting Standard 30

"Financial Instruments: Recognition and Measurements" (AS 30).

The use of foreign currency forward contracts / options is governed by the Company's policies approved by the Board of Directors, which provide written principles on the use of such financial derivatives consistent with the Company's risk management strategy. The counter party to the Company's foreign currency forward contracts is generally a bank. The Company does not use derivative financial instruments for speculative purposes.

Foreign currency forward contract/ option derivative instruments are initially measured at fair value and are re-measured at subsequent reporting dates. Changes in the fair value of these derivatives that are designated and effective as hedges of future cash flows are recognised directly in Hedging Reserve (under Reserves and Surplus) and the ineffective portion is recognised immediately in the Statement of Profit and Loss.

The accumulated gains / losses on the derivatives accounted in Hedging Reserve are transferred to the Statement of Profit and Loss in the same period in which gains / losses on the item hedged are recognized in the Statement of Profit and Loss.

Any Profit or Loss arising on cancellation or renewal of such a forward exchange contract is recognised as income or as expense in the period in which such cancellation or renewal is made. Changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognized in the Statement of Profit and Loss as they arise.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. Cumulative gain or loss on the hedging instrument recognised in shareholders' funds is retained there and is classified to Statement of Profit and Loss when the forecasted transaction occurs. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in shareholders' funds is transferred to the Statement of Profit and Loss for the period.

2.12 Employee Benefits:

(i) Gratuity:

The Company accounts for its gratuity liability, a defined retirement benefit plan covering eligible employees. The gratuity plan provides for a lump sum payment to employees at retirement, death, incapacitation or termination of the employment based on the respective employee's salary and the tenure of the employment. Liabilities with regard to a Gratuity plan are determined based on the actuarial valuation carried out by an independent actuary as at the Balance Sheet date using the Projected Unit Credit method.

Actuarial gains and losses are recognised in full in the Statement of Profit and Loss in the period in which they occur (refer note 38 below).

(ii) Provident fund:

The eligible employees of the Company are entitled to receive the benefits of Provident fund, a defined contribution plan, in which both employees and the Company make monthly contributions at a specified percentage of the covered employees' salary (currently at 12% of the basic salary) which are charged to the Statement of Profit and Loss on accrual basis. The provident fund contributions are paid to the Regional Provident Fund Commissioner by the Company.

The Company has no further obligations for future provident fund and superannuation fund benefits other than its annual contributions.

(iii) Superannuation and ESIC:

Superannuation fund and employees' state insurance scheme (ESI), which are defined contribution schemes, are charged to the Statement of Profit and Loss on accrual basis.

(iv) Compensated absences:

The Company provides for the encashment of leave subject to certain Company's rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment or availment. The liability is provided based on the number of days of unavailed leave at each Balance Sheet date on the basis of an independent actuarial valuation using the Projected Unit Credit method.

The liability which is not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised based on actuarial valuation as at the Balance Sheet date.

Actuarial gains and losses are recognised in full in the Statement of Profit and Loss in the period in which they occur.

The company also offers a short term benefit in the form of encashment of unavailed accumulated compensated absence above certain limit for all of its employees and same is being provided for in the books at actual cost.

(v) Other short term employee benefits:

Other short-term employee benefits such as overseas social security contributions and performance incentives expected to be paid in exchange for the services rendered by employees, are recognised during the period when the employee renders the service.

2.13 Borrowing costs:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use or sale. All other borrowing costs are charged to the Statement of Profit and Loss.

2.14 Taxation:

Tax expense comprises of current tax and deferred tax. Current tax is measured at the amount expected to be paid to / recovered from the tax authorities, based on estimated tax liability computed after taking credit for allowances and exemption in accordance with the local tax laws existing in the respective countries.

Minimum Alternative Tax (MAT) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability is considered as an asset if there is convincing evidence that the Company will pay normal tax after the tax holiday period. Accordingly, it is recognized as an asset in the Balance Sheet when it is probable that the future economic benefit associated with it will flow to the Company and the asset can be measured reliably.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets are recognised for timing differences of items other than unabsorbed debrciation and carry forward losses only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. However, if there are unabsorbed debrciation and carry forward of losses and items relating to capital losses, deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that there will be sufficient future taxable income available to realise the assets. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisability.

Tax on distributed profits payable in accordance with the provisions of the Income-Tax Act, 1961 is disclosed in accordance with the Guidance Note on Accounting for Corporate Dividend Tax issued by the Institute of Chartered Accountants  of India (ICAI)

2.15 Employee Stock Option Plans:

The Company determines the compensation cost based on the intrinsic value method. The company grants options to its employees which will be vested in a graded manner and are to be exercised within a specified period. The compensation cost is amortized on an accelerated basis over the vesting period.

2.16 Research and development:

Research costs are expensed as incurred. Development costs are expensed as incurred unless technical and commercial feasibility of the project is demonstrated, future economic benefits are probable, the Company has an intention and ability to complete and use the asset and the costs can be measured reliably.

2.17 Earnings per Share:

Basic earnings/ (loss) per share are calculated  by dividing the net profit / (loss) for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period are adjusted for any bonus shares issued during the year and also after the Balance Sheet date but before the date the financial statements are approved by the Board of Directors.

For the purpose of calculating diluted earnings / (loss) per share, the net profit / (loss) for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

The number of equity shares and potentially dilutive equity shares are adjusted for bonus shares as appropriate. The dilutive potential equity shares are adjusted for the proceeds receivable, had the shares been issued at fair value. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date.

2.18 Cash and cash equivalents (for the purpose of cash flow statement):

The Company considers all highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents.

2.19 Provision, Contingent Liabilities and Contingent Assets:

A provision is recognized when the Company has a brsent obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. The provisions (excluding retirement benefits) are not discounted to its brsent value and are determined based on best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect current best estimates.

Contingent liabilities are not recognized in the financial statements. A contingent asset is neither recognized nor disclosed in the financial statements.

24.3 Other commitments

The Company has outstanding commitments with respect to discharge of services to an international sports federation amounting to Rs. 30 Million as at March 31, 2016 (March 31, 2015: Rs. 27 Million).

24.4 Contingent Liabilities

i. Bank Guarantees/corporate guarantees outstanding as at March 31, 2016: Rs. 18,314 Million (March 31, 2015: Rs. 9,592 Million).

(The above includes corporate guarantees of USD 110 Million: Rs. 7,288 Million, (March 31, 2015 USD 40 Million: Rs. 2,500 Million) given to the bankers of two group companies for loan taken by them.)

ii. During the year ended March 31, 2016 the Company has given letter of support of Rs. Nil (March 31, 2015 USD 51 Million: Rs. 3,187 Million) to banks for loans availed by Lightbridge Communications Corporation (100% subsidiary of the Company).

iii. The Company has given letter of comfort of USD 25 Million (Rs. 1,656 Million) to bank for loans availed by Comviva Technologies B.V. (100% subsidiary of Comviva Technologies Limited). (March 31, 2015: USD Nil (Rs. Nil)).

iv. Outstanding Bill discounting as at March 31, 2016 Rs. 1,301 Million (March 31, 2015: Rs. 2,696 Million).

24.5.1 Additional taxation matters

i. Petition before Hon'ble High Court of Judicature at Hyderabad: Financial years 2002-03 to 2007-08

Erstwhile Satyam had filed various petitions before Central Board of Direct Taxes (CBDT) requesting for stay of demands aggregating to Rs. 6,170 Million for the financial years 2002-03 to 2007-08 till the correct quantification of income and taxes payable is done for the respective years. In March 2011, the CBDT rejected the petition and erstwhile Satyam filed a Special Leave Petition before the Hon'ble Subrme Court which directed erstwhile Satyam to file a combrhensive petition/ rebrsentation before CBDT and to submit a Bank Guarantee (BG) for Rs. 6,170 Million which was complied by erstwhile Satyam.

The CBDT, vide its Order dated July 11, 2011, disposed off the erstwhile Satyam's petition directing it to make its submissions before the Assessing Officer in course of the ongoing proceedings for the aforesaid years. Aggrieved by CBDT's Order, erstwhile Satyam filed a writ petition before the Hon'ble High Court of Judicature at Hyderabad on August 16, 2011.

The Hon'ble High Court of Judicature at Hyderabad, vide its Order dated January 31, 2012, directed the parties to maintain status quo and directed the Income-tax Department not to en-cash the BG until further Orders. The BG has been extended upto October 16, 2016.

In the meanwhile, the Assessing Officer served an Order dated January 30, 2012, for provisional attachment of properties under Section 281B of the Income-tax Act, 1961 attaching certain immovable assets of erstwhile Satyam on the grounds that there is every likelihood of a large demand to be raised against erstwhile Satyam for the financial years 2002-03 to 2008-09 along with interest liability. Aggrieved by such Order, erstwhile Satyam filed a writ petition in the Hon'ble High Court of Judicature at Hyderabad that has granted a stay on the operation of the provisional attachment Order until disposal of this writ.

ii. Appointment of Special Auditor and re-assessment proceedings

• In August, 2011, the Additional Commissioner of Income-tax issued the Draft of Proposed Assessment Orders accompanied with the Draft Notices of demand resulting in a contingent liability of Rs. 7,948 Million and Rs. 10,329 Million for the financial years 2001-02 and 2006­07, respectively, proposing variations to the total income, including variations on account of Transfer Pricing adjustments. Erstwhile Satyam has filed its objections to the Draft of Proposed Assessment Orders for the aforesaid years on September 16, 2011 with the DRP, Hyderabad, which is pending disposal.

• Consequent to the letter of erstwhile Chairman of the erstwhile Satyam, the Assessing Officer had commissioned special audits for the financial years 2001-02, 2002-03, 2006-07, 2007-08 and 2008-09 on various dates. Erstwhile Satyam had filed petitions before Hon'ble High Court of Judicature of Hyderabad challenging the special audits which are pending disposal.

iii. Provision for taxation for years prior to amalgamation with the Company

The erstwhile Satyam had accounted for provision for taxation for several prior years aggregating ^ 4,989 Million (net of taxes paid) as at March 31, 2013 (before giving effect to its amalgamation with the Company), for which the assessments are under dispute.

Subsequent to the amalgamation of erstwhile Satyam with the Company, considering the professional advice obtained in the matter, the Management has re-evaluated the effects of the possible outcomes of the tax matters in dispute relating to erstwhile Satyam and the estimated excess tax provision aggregating Rs. 2,266 Million, has been written back during the year ended March 31, 2014. In the opinion of the Management the balance provision for taxation carried in the books is adequate.

iv. During the year ended March 31, 2016, the Company has received the VAT refund from the Joint Commissioner of Commercial Tax, Bangalore for Karnataka Value Added Tax and Central Sales Tax amounting to Rs. 590 Million for the period pertaining to 2003-04 and 2004-05 and accordingly, the Company has written back the corresponding provision amounting to Rs. 319 Million, provided in an earlier year, as the same is no longer required.

v. In November 2014, the Company has received a notice from Income-tax Department for filing of petition in Hon'ble High Court of Judicature at Hyderabad against the ITAT Order for financial year 1998-99. The Income-tax Department has raised a demand of Rs. 13 Million on account of dispute in treatment of foreign taxes payment treated as self-assessment tax thereby levying interest under section 234B and 234C. The Company has filed an objection citing the limitation of time (almost four years from the date of ITAT Order) which is pending hearing.

vi. In October 2015, the Company has received a notice from Income-tax Department for filing of petition in High Court of Judicature at Hyderabad against the ITAT Order for financial year 2000-01. The Income-tax Department has raised a demand of Rs. 2 Million on account of dispute in treatment of foreign taxes payment treated as self-assessment tax, which is pending hearing.

24.6 Other Claims on the Company not acknowledged as debt

i. Alleged Advances: refer note 25.1.

ii. Claims against erstwhile Satyam not acknowledged as debts: Rs. 1,000 Million and interest (March 31, 2015 Rs. 1,000 Million).

iii. Claims made on the erstwhile Satyam by vendors, its employees and customers: Rs. 82 Million (March 31, 2015 Rs. 82 Million).

iv. Dispute in relation to a subsidiary, refer note 30.

v. Claims made on the Company not acknowledged as debts: Rs. 107 Million (March 31, 2015 Rs. 107 Million).

vi. Other claims: Rs. 6 Million (March 31, 2015 Rs. 6 Million) against which the erstwhile Satyam has paid an amount of Rs. 3 Million under protest.

vii. Claims on erstwhile MESL for disputed stamp duty of Rs. 1 Million (March 31, 2015 Rs. 1 Million) on sanction of credit facilities.

viii. Claims on erstwhile MESL under Motor vehicle Act, 1988 Rs. 1 Million (March 31, 2015 Rs. 1 Million).

ix. Claims not acknowledged as debts pending in arbitration Rs. 10 Million (March 31, 2015 Rs. Nil).

x. Claims made on the Company by vendors towards breach of contract amounting to Rs. 22 Million (SGD 0.4 Million) (March 31, 2015 Rs. Nil) pending in arbitration.

24.7 Management's assessment of contingencies/claims

The amounts disclosed under contingencies/claims rebrsent the best possible estimates arrived at on the basis of the available information. Due to high degree of judgment required in determining the amount of potential loss related to the various claims and litigations mentioned above and the inherent uncertainty in brdicting future settlements and judicial decisions, the Company cannot estimate a range of possible losses.

However, the Company is carrying a provision for contingencies as at March 31, 2016, which, in the opinion of the Management, is adequate to cover any probable losses in respect of the above litigations and claims. Refer note 49.

25 Certain matters relating to erstwhile Satyam Computer Services Limited (erstwhile Satyam):

In the letter dated January 7, 2009 Mr. B. Ramalinga Raju, the then Chairman of erstwhile Satyam, stated that the Balance Sheet of erstwhile Satyam as at September 30, 2008 carried inflated cash and bank balances, non-existent accrued interest, an understated liability and an overstated debtors position. Consequently, various regulators/investigating agencies such as the Serious Fraud Investigation Office (SFIO)/Registrar of Companies (ROC), Directorate of Enforcement (ED), Central Bureau of Investigation (CBI) had initiated investigations on various matters and conducted inspections and issued notices calling for information including from certain subsidiaries which have been responded to.

In 2009, SFIO initiated two proceedings against erstwhile Satyam for Companies Act violations which have since been compounded. On December 24, 2009, SFIO filed its report under Section 235 of the Companies Act before the Company Law Board (CLB) which stated that 'all these offences and violations relating to fraud have already been covered by CBI in its charge-sheet and a prosecution has been launched by CBI under various sections of Indian Penal Code' in none of which erstwhile Satyam was made a party. Consequently, the CLB vide its further Order dated March 1, 2016 struck off the name of the Company from the array of respondent in the Company Petition filed by the Ministry of Company Affairs (MCA). There are no other proceedings initiated by SFIO/CLB against the Company and the Management does not expect any further proceedings or penal action in this regard.

On a FIR filed by one of the investors, the Andhra Pradesh Crime Branch, Crime Investigation Department (AP CB CID), Hyderabad started an investigation into the fraud in 2009, which was subsequently transferred to CBI, Hyderabad. In all, there were 3 separate complaints instituted by the CBI before the XIV Additional Chief Metropolitan Magistrate cum Special Sessions Court, Hyderabad (Special Court). By a common judgment dated April 9, 2015, the Special Court found the accused persons guilty and convicted them. The Company was not named as an accused in the proceedings and in the said judgment. Thus, in the opinion of the Management, the matter is closed so far as the Company is concerned and no further proceedings against the Company are envisaged in this regard.

Further, certain non-compliances/breaches of various laws and regulations by the erstwhile Satyam under the former Management (prior to Government nominated Board) were identified by various agencies including but not limited to the following - payment of remuneration/commission to whole-time directors/ non-executive directors in excess of the limits brscribed under the Act, unauthorised borrowings, excess contributions to Satyam Foundation, loan to ASOP Trust (Satyam Associates Trust) without prior Board approval under the Act, delay in deposit of dividend in the bank, dividend paid without profits, non-transfer of profits to general reserve relating to interim dividend declared, utilisation of the Securities Premium account, declaration of bonus shares and violation of SEBI ESOP Guidelines, which have been responded to/appropriately addressed by the erstwhile Satyam/the Company and the Company does not expect any further proceedings in this regard.

On May 22, 2013, the ED had issued a show-cause notice to the erstwhile Satyam for contravention of provisions of the Foreign Exchange Management Act, 1999 (FEMA) for alleged non-repatriation of American Depository Receipts (ADR) proceeds aggregating USD 39.2 Million. The Company has responded to the ED's show-cause notice on March 28, 2014 and has not received any further communication in this regard.

The ED had also issued a show-cause notice to the erstwhile Satyam on April 28, 2011 for contravention of the provisions of FEMA and the Foreign Exchange Management (Realisation, Repatriation and Surrender of Foreign Exchange) Regulations, 2000, in respect of the non-realisation and repatriation of export proceeds to the extent of foreign exchange equivalent to Rs. 506 Million for invoices raised during the period July 1997 to December 31, 2002. The erstwhile Satyam has responded to the show-cause notice and has not received any further communication in this regard.

As per the assessment of the Management, based on the forensic investigation and the information available, all identified/required adjustments/disclosures arising from the identified financial irregularities, had been made in the financial statements of erstwhile Satyam as at March 31, 2009. Considerable time has elapsed after the initiation of investigation by various regulators/agencies and no new information has come to the Management's notice which requires adjustments to the financial statements. Further, as per above, the investigations have been completed and no new claims have been received which need any further evaluation/adjustment/disclosure in the books of account.

Proceedings in relation to 'Alleged Advances':

Pursuant to the aforesaid letter dated January 7, 2009, the erstwhile Satyam received letters from 37 companies seeking confirmation by way of acknowledgement of receipt of certain alleged amounts by the erstwhile Satyam (referred to as alleged advances). These letters were followed by legal notices from these companies dated August 4/5, 2009, claiming repayment of the alleged advances aggregating Rs. 12,304 Million stated to be given as temporary advances but without any evidence in support of the nature of these transactions. This is also borne out in the internal forensic investigation. The legal notices also claimed damages/compensation @18% per annum from the date of the advances till the date of repayment. The erstwhile Satyam has not acknowledged any liability to any of the 37 companies and has replied to the legal notices stating that the claims are legally untenable.

The 37 companies have filed petitions/suits for recovery against the erstwhile Satyam before the City Civil Court, Secunderabad (Court), with a prayer that these companies be declared as indigent persons for seeking exemption from payment of requisite court fees.

One petition where court fees have been paid, the pauper petition was converted into a suit which is pending disposal. The petitions filed by remaining 36 companies are before the Court, at various stages of rejection of pauperism/trial of pauperism/inquiry to condone the delay in applications. In one petition, the delay in submission of the petition has been condoned by the Court and the Company has obtained an interim stay Order from the Hon'ble High Court of Andhra Pradesh, which has remanded the matter to the lower Court directing to consider the application afresh. Lower Court upon hearing the application has condoned the delay in re-submission of pauper petition. The Company has challenged the said order in Revision before the High Court of Andhra Pradesh, which is pending hearing. In another development, Company has also filed a Revision against the orders of the Lower Court in the application filed by the Company to recall the Order in numbering the pauper petition as Original Petition. Hon'ble High Court has been pleased to stay the proceedings until further orders.

The Hon'ble High Court in its Order approving the merger of the erstwhile Satyam with the Company, further held that in the absence of Board resolutions and documents evidencing acceptance of unsecured loans, i.e. alleged advances, by the former Management of the erstwhile Satyam, the new Management of the erstwhile Satyam is justified in not crediting the amounts received in their names and not disclosing them as creditors and in disclosing such amounts as 'Amounts pending investigation suspense account (net)' in the financial statements. The Hon'ble High Court held, inter-alia, that the contention of the 37 companies that Satyam is retaining the money, i.e. the alleged advances, of the 'creditors' and not paying them does not appear to be valid and further held that any right of the objecting creditors can be considered only if the genuineness of the debt is proved beyond doubt which is not so in this case.

The said 37 companies have filed appeals before the Division Bench of the Hon'ble High Court of Andhra Pradesh, against the Orders of the Hon'ble High Court of Andhra Pradesh and the Hon'ble High Court of Judicature at Bombay sanctioning the scheme of merger of Satyam Computer Services Limited (Satyam) with the Company w.e.f. April 1, 2011, which are yet to be heard. One of the aforesaid companies has also appealed against the Order rejecting the Petition for winding-up of the erstwhile Satyam. These matters have been combined for hearing.

The Directorate of Enforcement (ED) while investigating the matter under the Prevention of Money Laundering Act, 2002 (PMLA) had directed the erstwhile Satyam not to return the alleged advances until further instructions. In furtherance to the investigation, certain fixed deposits of the Company with certain banks, then aggregating to Rs. 8,220 Million were alleged by ED to be 'proceeds of crime' and were provisionally attached vide Order dated October 18, 2012 by the ED (the Order). The Hon'ble High Court of Andhra Pradesh (the Court) had, pending further Orders, granted stay of the said Order and all proceedings thereto vide its Order dated December 11, 2012. The ED had challenged this interim Order passed by the Single Judge before the Division Bench of the Court. Vide order dated December 31, 2014, the Hon'ble High Court upon hearing the matter, has dismissed the Appeal filed by ED and affirmed the Stay granted by the Single Judge. Consequently, out of the aforesaid fixed deposit which were attached, fixed deposits aggregating Rs. 3,570 Million have been redeemed. Certain banks have not honored the redemption claim and the Company is pursuing the matter legally.

A criminal case was filed by the ED before the Hon'ble XXI Additional Chief Metropolitan Magistrate, Hyderabad cum Special Sessions Court (Trial Court) under the PMLA against erstwhile Satyam along with 212 accused persons. The Company had challenged the above prosecution before the Hon'ble High Court of Andhra Pradesh which quashed the criminal complaint against the Company vide its Order dated December 22, 2014. On an appeal brferred by the ED, the Divisional Bench of the High Court, however passed an interim Order allowing the hearing for framing 'Charges'. A Special Leave Petition was filed by the Company before the Hon'ble Subrme Court of the India, which, vide its Order dated May 11, 2015, directed the Hon'ble High Court of Andhra Pradesh to dispose off the Writ Appeal on its merits and brferably within a period of four months and further stayed the proceeding before the Trial Court. The said Appeal has not been heard till date.

In view of the aforesaid developments, which occurred and crytallised during the year and also based on an independent legal opinion the Management believes that the claim by the 37 companies for repayment of the alleged advances, including interest thereon is not legally tenable. Consequently, pending the final outcome of the proceedings, as a matter of prudence, at this point of time, the Company has accounted and disclosed the amount of Rs. 12,304 Million as 'Suspense Account (net)', provided earlier. Although remote, in the event that these cases are decided against the Company, there would be no effect on the financial results or financial position of the company.

26 Claims by certain Shareholders of Erstwhile Satyam

In terms of the Settlement of claims made by Aberdeen Asset Management PLC., UK and Aberdeen Claims Administration Inc., USA, the erstwhile Satyam has deposited a total amount of USD 80.16 Million towards the Settlement Amount and interest in an Escrow Account during the financial year ended March 31, 2013. Remittance out of the Escrow is subject to the determination of appropriate withholding tax by the Authority for Advance Ruling (AAR).

27 Scheme of Amalgamation and Arrangement of Mahindra Engineering Services Limited (MESL):

Pursuant to the Scheme of Amalgamation and Arrangement (the Scheme) sanctioned by the Hon'ble High Court of Judicature at Bombay vide its Order dated October 31, 2014, MESL, merged with the Company with effect from the appointed date of April 1, 2013. MESL was engaged in the business of rendering engineering services in relation to designing and developing parts, components, systems and aggregates relating to the automotive sector. The Scheme came into effect on December 8, 2014, the day on which the Order was delivered to the Registrar of the Companies, and pursuant thereto the entire business and all the assets and liabilities, duties, taxes and obligations of MESL have been transferred to and vested in the Company with effect from April 1, 2013.

In accordance with the Scheme, the Company had, in December 20, 2014, issued 5 Equity shares of Rs. 10 each fully paid-up in respect of every 12 Equity shares of Rs. 10 each of MESL, aggregating to 4,259,011 Equity shares as purchase consideration to the existing shareholders of MESL ranking pari-passu in all respects with the existing Equity shares of the Company. The Company has initiated the name change formalities in respect of contracts, agreements, etc. of MESL.

The amalgamation is accounted under the 'pooling of interest' method as per Accounting Standard 14 on 'Accounting for Amalgamations' and as modified under the Scheme as under:

• All assets, liabilities and reserves, including the surplus in the Statement of Profit and Loss of MESL have been recorded in the books of account of the Company at their respective carrying amounts and in the same form.

• The difference between face value of Equity shares issued by the Company pursuant to the Scheme and the amount of share capital of MESL, have been adjusted in the Reserves of the Company.

28 Scheme of Amalgamation of Tech Mahindra BPO Limited and New vC Services Private Limited

Pursuant to the Scheme of Amalgamation (the Scheme) sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated March 04, 2016, Tech Mahindra BPO Limited (TMBPO), and New vC Services Private Limited (New vC) have been merged with the Company with effect from April 1, 2015 (the appointed date). The Scheme came into effect on March 29, 2016, the day on which the order was delivered to the Registrar of the Companies, and pursuant thereto the entire business and all the assets and liabilities, duties, taxes and obligations of TMBPO and New vC have been transferred to and vested in the Company with effect from April 1, 2015.

TMBPO was engaged in business processes management, transitioning services and customer contract services.

New vC was engaged in the business of rendering Information Technology enabled and data processing services.

As the amalgamating companies i.e. TMBPO and New vC are both wholly owned subsidiaries of the Company, no consideration is payable on amalgamation with the Company.

The amalgamation is accounted under the 'pooling of interest' method as per Accounting Standard 14 on 'Accounting for Amalgamations' and as modified under the Scheme as under:

• All assets and liabilities and reserves of TMBPO and New vC have been recorded in the books of account of the Company at their respective carrying amounts and in the same form.

• Amount of Share capital of the transferor companies and gross value recorded as investments is adjusted and the difference is debited to The 'General Reserves' in accordance with the Scheme.

• Accordingly, the assets and liabilities of TMBPO and New vC are accounted at the following summarized values:

The Company has initiated the name change formalities to transfer the title in respect of the contracts, agreements, etc. of TMBPO and New vC.

29 Land / Immovable Properties

i. In respect of certain land admeasuring 19.72 acres purchased by erstwhile Satyam in Hyderabad, erstwhile Satyam entered into an agreement with the Government of Andhra Pradesh (GoAP) pursuant to which, it is eligible for incentives, concessions, privileges and amenities under the Information and Communications Technology (ICT) Policy of the GoAP. During the financial year ended March 31, 2009, erstwhile Satyam accounted for an eligible grant amounting to Rs. 96 Million towards the basic cost of the land on acquisition which was adjusted to the cost of the land. Erstwhile Satyam's entitlement to the aforesaid grant is subject to the fulfillment of certain conditions (secured by bank guarantees issued in favor of Andhra Pradesh Industrial Infrastructure Corporation (APIIC)), including employment of a minimum of eligible employees in facilities constructed over the said land, that have been substantially met and are under validation by the GoAP. The Company has earlier provided bank guarantee of Rs. 23 Million which is expired and no new bank guarantee has been submitted by the Company. Further, the Company has filed an application dated March 26, 2014 to Andhra Pradesh Industrial Infrastructure Corporation Limited requesting execution of sale deed. Sale deed was executed on December 04,

2014 and original documents are in process of being obtained from the Telangana State Industrial Infrastructure Corporation Limited then APIIC.

ii. In respect of land admeasuring 50 acres purchased from Andhra Pradesh Industrial Infrastructure Corporation Limited in Vishakhapatnam for a total cost of Rs. 50 Million, there are certain disputes which have arisen and the Government of Andhra Pradesh has ordered the District Collector to allot alternate land to erstwhile Satyam. The Government of Andhra Pradesh has signed MOU with the Company on September 29, 2014, to allot 10 acres of land to Company on lease in lieu of land earlier allotted. In terms of the MOU signed with the government, the Company registered a Lease Deed on July 10,

2015 for 6 acres of land and took possession. Balance 4 acres of land is reserved for the Company for which Lease Deed will be executed and possession will be given on fulfillment of conditions as laid down in MOU. The amount of Rs. 50 Million is included in Capital Advances (under Long-term loans and advances) as at March 31, 2016 (March 31, 2015: Rs. 50 Million).

iii. The erstwhile Satyam has entered into an agreement with the Maharashtra Airport Development Company Ltd (MADC) for the land taken on lease in Nagpur for which it has obtained extension to erect buildings and commence commercial activities by July 27, 2016.

iv. Pursuant to the Scheme of Amalgamation and Arrangement (the Scheme) sanctioned by the Hon'ble High Court of Andhra Pradesh vide its order dated June 11, 2013 and the Hon'ble High Court of Judicature at Bombay vide its order dated September 28, 2012, Venturbay Consultants Private Limited (Venturbay), CanvasM Technologies Limited (CanvasM) and Mahindra Logisoft Business Solutions Limited (Logisoft), the wholly owned subsidiaries of the Company, and Satyam Computer Services Limited (Satyam) an associate of the Company (through Venturbay) and C&S System Technologies Private Limited (C&S) a wholly owned subsidiary of erstwhile Satyam, merged with the Company with effect from April 1, 2011 (the appointed date). The Scheme came into effect on June 24, 2013, the day on which both the orders were delivered to the Registrar of the Companies, and pursuant thereto the entire business and all the assets and liabilities, duties and obligations of Satyam, Venturbay, CanvasM, Logisoft and C&S have been transferred to and vested in the Company with effect from April 1, 2011. Pursuant to the Scheme, the title deeds for the immovable properties pertaining to the amalgamating companies are pending conveyance in the name of the Company. Further, the Company has initiated the name change formalities to transfer the title in respect of the other properties, contracts etc

30 Dispute with Venture Global Engineering LLC

Pursuant to a Joint Venture Agreement in 1999, the erstwhile Satyam and Venture Global Engineering LLC (VGE) incorporated Satyam Venture Engineering Services Private Limited (SVES) in India with an objective to provide engineering services to the automotive industry.

On or around March 20, 2003, numerous corporate affiliates of VGE filed for bankruptcy and consequently the erstwhile Satyam, exercised its option under the Shareholders Agreement (the SHA), to purchase VGE's shares in SVES. The erstwhile Satyam's action, disputed by VGE, was upheld in arbitration by the London Court of International Arbitration vide its award in April 2006 (the Award).

The Courts in Michigan, USA, confirmed and directed enforcement of the Award. They also rejected VGE's challenge to the Award. In 2008, the District Court of Michigan further held VGE in contempt for its failure to honour the Award and inter-alia directed VGE to dismiss the nominees of VGE on its Board and replace them with individuals nominated by the erstwhile Satyam. This Order was also confirmed by the Sixth Circuit Court of Appeals in 2009. Consequently, erstwhile Satyam's nominees were appointed on the Board of SVES and SVES confirmed the appointment at its Board meeting held on June 26, 2008. The erstwhile Satyam was legally advised that SVES became its subsidiary only with effect from that date.

In the meantime, while proceedings were pending in the USA, VGE filed a suit in April 2006, before the District Court of Secunderabad in India for setting aside the Award. The City Civil Court, vide its judgment in January 2012, has set aside the Award, against which the erstwhile Satyam brferred an appeal (Company Appeal) before the High Court.

VGE also filed a suit before the City Civil Court, Secunderabad inter alia seeking a direction to the Company to pay sales commission that it was entitled to under the Shareholders Agreement. In the said suit, two ex-parte Orders were issued directing the Company and Satyam to maintain status quo with regard to transfer of 50% shares of VGE and with regard to taking major decisions which are brjudicial to interest of VGE. The said suit filed by VGE is still pending before the Civil Court.

The Company has challenged the ex-parte Orders of the City Civil Court Secunderabad, before the High Court (SVES Appeal).

The High Court of Andhra Pradesh consolidated all the Company appeals and by a common Order dated August 23, 2013 set aside the Order of the City Civil Court, Hyderabad setting aside the award and also the ex-parte Orders of the City Civil Court, Secunderabad. The High Court as an interim measure ordered status quo with regard to transfer of shares, originally given by Subrme Court to be maintained for four weeks which was extended for a further period of three weeks. VGE has filed special leave petition against the said Order before Subrme Court of India, which is currently pending. The Subrme Court by an interim Order dated October 21, 2013 extended the High Court Order on the status-quo on transfer of shares. The Company has also filed a Special Leave Petition before the Subrme Court of India challenging the judgment of the High Court only on the limited issue as to whether the Civil Court has jurisdiction to entertain VGE's challenge to the Award. The said Petition is pending before the Subrme Court.

In a related development, in December 2010, VGE and the sole shareholder of VGE (the Trust, and together with VGE, the Plaintiffs), filed a complaint against the erstwhile Satyam in the United States District Court for the Eastern District of Michigan (District Court) inter alia asserting claims under the Racketeer Influenced and Corrupt Organization Act, 1962 (RICO), fraudulent concealment and seeking monetary and exemplary damages (the Complaint). The District Court vide its order in March 2012 has dismissed the Plaintiffs Complaint. The District Court also rejected VGE's petition to amend the complaint. In June 2013, VGE's appeal against the order of the District Court has been allowed by the US Court of Appeals for the Sixth Circuit. The matter is currently before the District Court and the Company has filed a petition before District Court seeking dismissal of the Plaintiff's Complaint. The said petition is pending before the District Court. On March 31, 2015, the US District Court stayed the matter pending hearing and decision by the Indian Subrme Court in the Special Leave Petitions filed by Venture and the Company

31 Other matters

Foreign currency receivables

In respect of overdue foreign currency receivables for the period's upto March 31, 2009 pertaining to Erstwhile Satyam and overdue foreign currency receivables of TMBPO, the Company is taking steps under the provisions of FEMA, for recovery and/or permissions for write-offs, as appropriate. Erstwhile Satyam under the Management post Government nominated Board and TMBPO has fully provided for these receivables.

32 Share application money pending allotment

The amount received from employees on exercise of stock options is accounted as Share application money pending allotment. Upon allotment, the amount received corresponding to the shares allotted against the options exercised is transferred to Share capital and Securities brmium account (if applicable) and taxes (if applicable) recovered from employees. An amount of Rs. 14 Million is outstanding as at March 31, 2016 (March 31, 2015: Rs. 3 Million) rebrsenting amounts received from employees of the Company on exercise of stock options towards face value, securities brmium and perquisite tax recovered by the Company from the employees, pending allotment.

33 A) Acquisitions / Additional Investments in entities

i) On March 30, 2015, Company had incorporated 100% subsidiary as Tech Mahindra DRC SARLU in Congo DRC. During the year ended March 31, 2016, the Company has made an investment of USD 0.1 Million (Rs. 6 Million).

ii) On May 15, 2015, Company had incorporated a subsidiary Nth Dimension Ltd in United Kingdom with a stake of 86.50%. During the year ended March 31, 2016, the Company has infused share capital of GBP 8.65.

iii) The Company has entered into a joint venture agreement dated April 25, 2015 with "Qatar Engineering Trading and Contracting Company" and "KPC Aurion Holding WLL." in an incorporated entity namely IQS Information Solutions WLL in Qatar. The Company holds minority stake in this entity and has infused USD 0.02 Million (Rs. 1 Million) in IQS Information Solutions WLL during the year ended March 31, 2016. The Company has classified its investment in IQS Information Solutions WLL as investment in associate.

iv) During the year ended March 31, 2016, the Company has infused additional share capital USD 5.69 Million (Rs. 379 Million) in its 100% subsidiary Tech Mahindra Servicos De Informatica LTDA.

v) During the year ended March 31, 2016, the Company has infused additional share capital of RM 10 Million (Rs. 159 Million) in its 100% Subsidiary Tech Mahindra ICT Services (Malaysia) SDN. BHD.

vi) During the year ended March 31, 2016, Company had incorporated a subsidiary Tech Mahindra Arabia Limited in Saudi Arabia wherein the Company holds controlling stake i.e. 51% equity. The Company has infused SAR 0.51 Million (Rs. 9 Million) in Tech Mahindra Arabia Limited.

vii) During the year ended March 31, 2016, the Company has infused additional share capital of USD 0.37 Million (Rs. 24 Million) in its 100% subsidiary Satyam Computer Services De Mexico S.DE R.L.DE C.V. Further, the name of Satyam Computer Services De Mexico S.DE R.L.DE C.V was changed to Tech Mahindra De Mexico S.DE R.L.DE C.V.

viii) During the year ended March 31, 2016, the Company formed a 100% subsidiary in France namely Tech Mahindra France SAS. The Company infused EUR 0.1 Million (Rs. 7 Million) in share capital of Tech Mahindra France SAS.

ix) The Company formed a 100% subsidiary in India namely Tech Mahindra Growth Factories Limited. The Company infused Rs. 98 Million in share capital of Tech Mahindra Growth Factories Limited.

x) During the year ended March 31, 2016, the Company formed a 100% subsidiary in Netherlands namely Tech Mahindra Netherlands B.V. The Company infused EUR 0.05 Million (Rs. 3 Million) in

the sha re capital of Tech Mahindra Netherlands B.V.

xi) During the year ended March 31, 2016, the Company has infused SEK 0.05 Million (Rs. 0.4 Million) in Tech Mahindra Sweden AB (a 100% Subsidiary of the Company) and its incorporation is under process.

xii) During the year ended March 31, 2016, as per the notarized merger order, Mahindra Engineering GmbH was merged with Tech Mahindra GmbH w.e.f. April 1, 2015. Tech Mahindra Limited and Mahindra Engineering Services (Europe) Limited are shareholders of Mahindra Engineering GmbH holding 84% and 16% respectively.

As per the merger order, all assets and liabilities with duties and obligations are transferred to Tech Mahindra GmbH and the shareholders of Mahindra Engineering GmbH to waive off their rights. The Company has already provided for its investment in Mahindra Engineering GmbH during the brvious years. The Company is in process of applying to RBI for the approval of write off for the said investment in the books of accounts.

B) Entity incorporated but operations not commenced

During the year ended March 31, 2015, the Company had incorporated a 100% subsidiary in Canada namely TechM Canada Inc. However, neither any investment has been made by the Company in the said subsidiary as at March 31, 2016 nor has commenced its operations.

34 A) Disinvestments in / Liquidations of entities:

i) During the year ended March 31, 2016, following entities (100% subsidiaries of Lightbridge Communications Corporation) have been closed/liquidated/dissolved and no transactions were entered into with these subsidiaries during the year ended March 31, 2016.

Name of Entities

Opticore Holdings, Inc

Opticore Networks, Inc.

Opticore Networks EMA, LLC

Opticore EMA, LLC

LCC Diseno y Servicios Argentina, SRL

Burgundy Holding Corporation

LCC Wireless Design Services, Inc

Wireless Facilities International Ltd

LCC Wireless Services Canada, Inc

LCC Middle East Holdings, B.V.

LCC Colombia LTDA

Leadcom Integrated Solutions USA Inc.

LCC Diseno y Servicios Chile

ii) During the year ended March 31, 2016 following entities (100% subsidiaries of Lightbridge Communications Corporation) and Sofgen Holdings Limited had applied for liquidation and the same is under process.

Name of Entities

LCC do Brasil LTDA

SC Compania Sofgen SRL

LCC Diseno y Servicios de RED Peru S.R.L

iii) With effect from December 31, 2015, 100% stake of Leadcom Telecommunicaciones de Chile S.A. (a 100% subsidiary of Lightbridge Communications Corporation) has been disinvested for a consideration of EUR 0.001 Million (Rs. 0.08 Million).

B) Liquidated - R.B.I approval pending

i) During the year ended March 31, 2016 Satyam Colombia Servicios DE Informatica SAS (100% subsidiary of Tech Mahindra Servicos DE Informatica LTDA) had applied for liquidation. With effect from February 15, 2016 Satyam Colombia Servicios DE Informatica SAS has been liquidated.

ii) During the year ended March 31, 2015 Satyam Computer Services Belgium, BVBA (100% subsidiary of the Company) had applied for voluntary liquidation and has been dissolved in accordance with Article 184 of the Companies Code applicable in Belgium on September 17, 2014. On liquidation, the Company has received Rs. 328 Million (EUR 4.23 Million) as proceeds of liquidation. The Company's value of investment in the said entity (net of provision) before the liquidation was ^ 316 Million. Therefore excess proceeds of Rs. 12 Million have been accounted under sundry balance written back under other income. The Company has applied to RBI for approval to write off the said investment. The Company is awaiting for approval and hence the investments and provision for investments are not knocked off.

iii) Satyam Computer Services (Egypt) S.A.E a 100% subsidiary had applied for voluntary liquidation during the year ended March 31, 2012 as per local regulations applicable to it. With effect from June 25, 2015 Satyam Computer Services (Egypt) S.A.E has been liquidated.

35 The Company's Management assesses the operations of the subsidiaries/entities, including the future projections, to identify indications of diminution, other than temporary, in the value of the investments recorded in the books of account and, accordingly no additional provision is required to be made, other than the amounts provided for in the books of account.

36 Provision made / reversed against Investments of subsidiaries/entities

i. In September 2008, the Company had made an investment of Rs. 85 Million which was equal to 17.28% of the equity share capital of Servista Limited, a leading European system integrator. With this investment, the Company became Servista' s exclusive delivery arm for three years and would assist Servista in securing more large scale European IT off shoring business. Subsequently, the business plan of Servista was adversely affected by the economic downturn and it continued to incur losses and therefore, Servista in June 2009 decided to close down its operations. Hence, the Company made a provision of Rs. 85 Million in the year ended March 31, 2010 as diminution in the value of its investments in Servista. As of March 31, 2016, Servista is in process of winding up and in the view of the Management; the Company would have no further unrecorded obligations towards settlement of any further liability

37 Exceptional item

During the year ended March 31, 2015, based on the Management's assessment and improved financial performance of Citisoft Plc, the Company had reversed the provision for diminution in value of its investment in Citisoft Plc, which was provided in earlier years, amounting to Rs. 613 Million.

38 Details of employee benefits as required by the Accounting Standard 15 (Revised) - Employee Benefits are as under:

i. Defined Contribution Plan

The Company makes contributions to Provident Fund, Superannuation Fund, National Pension Fund and Employee State Insurance Scheme which are defined contribution plans for qualifying employees. Under these Schemes, the Company contributes a specified percentage of the payroll costs to the respective funds.

The Company recognized expense in the Statement of Profit and Loss amounting to:

• Rs. 2,233 Million (March 31, 2015: Rs. 2,096 Million) for Provident Fund contributions,

• Rs. 386 Million (March 31, 2015 : Rs. 425 Million) for Superannuation Fund contributions,

• Rs. 20 Million (March 31, 2015 : Rs. 18 Million) for National Pension Scheme contributions and

• Rs. 46 Million (March 31, 2015: Rs. 36 Million) for Employee State Insurance Scheme contributions. The contributions to these plans are made at specified percentage / applicable amounts.

ii. Defined Benefit Plan

The defined benefit plan comprises of gratuity. The gratuity plan is partly funded. Changes in the brsent value of defined obligation are rebrsenting reconciliation of opening and closing balances thereof and fair value of Trust Fund Receivable (erstwhile TMRDL / MESL / TMBPO / New vC) showing amount recognized in the Balance Sheet is as under

39 The Hon'ble Subrme Court vide its order dated February 2, 2012 cancelled 2G licenses issued to some of Telecom operators in India in 2008. As a result of the cancellation, the business of Company's two customers has become unviable and one of the customers has started winding up proceedings of the Indian operations. The Company had made provision of Rs. 679 Million in the year ended March 31, 2012 on account of likely impairment in the carrying value of the related assets

40 Exchange gain/(loss)(net) accounted during the year

i. The Company enters into foreign Exchange Forward Contracts and Currency Option Contracts to offset the foreign currency risk arising from the amounts denominated in currencies other than the Indian rupee. The counter party to the Company's foreign currency Forward Contracts and Currency Option Contracts is generally a bank. These contracts are entered into to hedge the foreign currency risks of certain forecasted transactions. Forward Exchange Contracts and Currency Option Contracts in UK Pound exposure are split into two legs, which are GBP to USD and USD to INR. These contracts are for a period between 1 day and 2 years.

41 Current tax for the year ended March 31, 2016 includes tax expense (net of refund/write back) for foreign branches amounting to Rs. 1,297 Million (March 31, 2015: Rs. 1,961 Million).

Current tax expense for the year ended March 31, 2016 is net of excess provision of Rs. 531 Million (net) (March 31, 2015: Rs. 64 Million) of earlier periods written back, no longer required.

The Company has made provision towards current tax in respect of its domestic operations for the year ended March 31, 2016. Further, the Management has assessed the Company's tax position in respect of its overseas operations taking into account the relevant rules and regulations as applicable in the respective countries. Based on professional advice, it has been determined that the provision made currently is adequate.

42 Employee Stock Option Scheme

i. ESOP 2000 & ESOP 2010:

The Company has instituted 'Employee Stock Option Plan 2000' (ESOP 2000) and 'Employee Stock Option Plan 2010' (ESOP 2010) for eligible employees and Directors of the Company and its subsidiaries. The vesting pattern of the schemes has been provided below. The options can be exercised over a period of 5 years from the date of grant Each option carries with it the right to purchase one equity share of the Company at the exercise price determined by the Company at the time of grant for ESOP 2000 and exercise price as determined by the Nomination and remuneration Committee for ESOP 2010.

ii. ESOP 2006 & ESOP 2014:

The Company has instituted 'Employee Stock Option Plan 2006' (ESOP 2006) and 'Employee Stock Option Plan 2014' (ESOP 2014) for eligible employees and Directors of the Company and its subsidiaries. In terms of the said plan, the Nomination and Remuneration Committee has granted options to the employees of the Company. The maximum exercise period is 7 years from the date of grant for ESOP 2006 and options can be exercised over a period of 5 years from the date of vesting for ESOP 2014.

iii. TML ESOP - B 2013:

Erstwhile Satyam has established a scheme 'Associate Stock Option Plan - B' (ASOP - B) under which 28,925,610 options were available for grant/exercise at the time the Scheme of Amalgamation became effective. Post-merger, these options were adjusted in terms of the approved Scheme of Amalgamation and obtained Listing approval for 3,403,013 options and each option entitles the holder one equity share of the Company. These options vest over a period of 1 to 4 years from the date of the grant. Upon vesting, employees have 5 years to exercise the options. Post-merger, the name of the ESOP scheme has been changed to 'TML ESOP B 2013'.

iv. TML- RSU:

The erstwhile Satyam has established a scheme 'Associate Stock Option Plan - Restricted Stock Units (ASOP - RSUs)' to be administered by the Administrator of the ASOP - RSUs, a committee appointed by the Board of Directors of the erstwhile Satyam in May 2000. Under the scheme, 1,529,412 equity shares (equivalent number of equity shares post-merger) are reserved to be issued to eligible associates at a price to be determined by the Administrator which shall not be less than the face value of the share. These RSUs vest over a period of 1 to 4 years from the date of the grant. The maximum time available to exercise the options upon vesting is five years from the date of each vesting. Post-merger, the name of the ESOP scheme has been changed to TML RSU.

v. ESOP - A:

Erstwhile Satyam had established an ESOP scheme viz., 'Associate Stock Option Plan - A' (ASOP - A) formulated prior to the SEBI Guidelines on ESOP and ESPS issued in 1999. This plan was administered through an employee's trust viz., Satyam Associates Trust (Satyam Trust). At the time the Scheme of Amalgamation and Arrangement became effective, the Satyam Trust was holding 2,055,320 shares of erstwhile Satyam, which post amalgamation were converted into 241,802 shares of the Company at the approved share exchange ratio and this scheme has been transitioned and renamed as ESOP-A. Satyam Trust grants warrants to the employees of the Company with an exercise price and terms of vesting advised by the Nomination and Remuneration Committee of the Company. Each warrant shall entitle the warrant holder one equity share. The exercise period is 180 days from the date of each vesting.

vi. Employee Stock Option Scheme - ESOS:

Erstwhile MESL has established Employee Stock Option Scheme (ESOS) - ESOS for which 1,400,000 equity shares respectively were earmarked. ESOS Scheme is administered through a Trust viz., MES Employees Stock Option Trust. The options under this Scheme vest over a period of 1 to 3 years from the date of the grant. Upon vesting, employees have 7 years to exercise the options. As on the effective date of amalgamation, only 18,084 options were outstanding under ESOS which are converted into equivalent 30,144 options of the Company giving effect to approved share exchange ratio, split and bonus.

43 Segment information has been brsented in the Consolidated Financial Statements as permitted by Accounting Standard (AS 17) on Segment Reporting as notified under the Companies (Accounting Standard) Rules, 2014.

44 Based on the information available with the Company, there are no outstanding amount payable to creditors who have been identified as "suppliers" within the meaning of "Micro, Small and Medium Enterprises Development (MSMED) Act, 2006".

45 Tax on Dividend

Shareholders at the Annual General Meeting held on July 28, 2015 had approved the dividend of Rs. 6 per Equity Share which was paid during the year ended March 31, 2016. On the said dividend, Company had made a provision towards dividend distribution tax of Rs. 1,173 Million in March 2015. During the year, the Company has received dividend from its subsidiaries of Rs. 5,587 Million. As per the provisions of Section 115O of Income tax Act, 1961, the Company has calculated dividend tax after adjusting dividend received from its subsidiaries. The Company has paid dividend distribution tax of Rs. 36 Million and excess provision for dividend distribution tax of Rs. 1,137 Million has been written back since no longer required.

46 Previous period's figures have been regrouped / reclassified wherever necessary, to correspond with the current period's classification / disclosure.

For and on behalf of the Board of Directors

Anand G. Mahindra

Chairman

C. P. Gurnani

Managing Director & CEO

M. Rajyalakshmi Rao Director

V S Parthasarathy Director

Ravindra Kulkarni Director

Milind Kulkarni Chief Financial Officer

Vineet Nayyar Vice Chairman

Anupam Puri Director

M. Damodaran Director

T. N. Manoharan Director

Ulhas N. Yargop Director

G. Jayaraman Company Secretary

Place: Mumbai, India

Dated: May 24, 2016