Significant management judgement is exercised by reviewing the deferred tax assets at each reporting date to

determine the amount of deferred tax assets that can be retained/ recognised, based upon the likely timing and

the level of future taxable profits together with future tax planning strategies.

44 Indian Accounting Standard (Ind AS) 16, Disclosure on Property, Plant & Equipment & Indian Accounting

Standard (Ind AS) 38, Disclosure on Intangible Assets

1 The depreciation / amortization has been charged at the straight-line method.

2 Company assessed the impairment of Assets and is of the opinion that since the Company is going concern and there is no indication exist for the impairment of the PPE except in case of NE project for which disclosure is given under Ind AS-36.

3 The useful life of all the PPE / Intangible Assets have been defined in the accounting policies.

4 A reconciliation of the carrying amount at the beginning and end of the period is as per Note No. 2 & 5 of Balance Sheet.

5 No assets have been classified as held for sale in accordance with Ind AS 105.

6 Company has not revalued its property, plant & Equipment (including right of use assets ).There is no increase or decrease on account of impairment loss recognized or reversed in other comprehensive income in accordance with Ind AS 36.

7 No Capital expenses was incurred on Assets not owned by the Company during the period ended 31.03.2025.

8 There is no obsolete asset which has been so far held under CWIP/Fixed Asset.

9 Depreciation / amortization on all the PPE / Intangible assets have been disclosed separately.

10 There is no restriction on title of PPE / Intangible Assets, and nothing has been pledged as security and liability.

11 The amount of contractual commitment for acquisition of PPE is Rs. 31153 lakhs (March'24 - Rs. 29648 Lakhs).

12 There is no amount to be received on account of compensation from third party for items of PPE / Intangible assets that were impaired, lost or given to Company that is to be recognized in the statement of profit & Loss account.

13 Entire depreciation / amortization has been recognized in the statement of Profit & Loss account; nothing has been charged to cost of other assets. Accumulated depreciation at the end of the year has been shown separately.

14 There are no temporarily idle PPE / intangible assets.

15 Assets of Gross Carrying Value of Rs. 75684 Lakhs (FY24- 68444 Lakhs) have been fully depreciated, but still are in use.

16 During the reporting year Assets having Net Book Value of Rs. 12 Lakh (Gross Book Value 48 Lakhs) has been retired with sale proceeds of Rs. 4 Lakh and loss of Rs 9 lakh has been booked.

17 In the following asset category, depreciation is charged at different rates as compare to the rates prescribed in part C of Schedule II of the Companies Act'2013 on the basis of useful life determined by technical committee:

45 Indian Accounting Standard (Ind AS) 19, Disclosure on Employee Benefits Employee Benefits - Defined Contribution Plan National Pension Scheme

RailTel pays an amount equal to 10% of Basic pay DA of the eligible employees in National pension scheme. Amount for FY 2024-25 is Rs. 692 Lakhs.

Provident Fund

All employees of the Company (excluding those on deputations) are entitled to receive benefits under the Provident Fund, which is a defined contribution plan. Both the employee and employer make monthly contribution to the plan at a pre-determined rate (presently 12%) of the employees' salary consisting of Basic pay and Dearness allowance. These contributions are made to the fund administered and managed by Provident Fund Commissioner. The contributions of PF of the employee on deputation are made to the funds of their parent department. Amount for FY 2024-25 is Rs. 1020 Lakhs.

Employee Benefits - Defined Benefit Plan Gratuity

The Company has scheme of gratuity plan for its employees from LIC. Every employee who has completed at least five years of service are entitled for gratuity at the time of relinquishment of employment for 15 days of last drawn salary for each completed year of service. The scheme is funded through LIC in the form of qualifying insurance policy for its employees except outsourced Manpower.

Leave Encashment

The Company has scheme of Leave Encashment payable to eligible employees who have accumulated earned leave subject to maximum ceiling of 300 earned leave including half pay leave. Leave salary is provided for based on actuarial valuations, as at the Balance Sheet date. The scheme is funded through LIC.

Post-Retirement Medical

The Company has Post-Retirement Medical Scheme (PRMS) to provide assistance for meeting a part of medical expenses incurred by retired members only after their retirement for dependent family members and self and dependent family members of the ex-employee in case of death of the employee. Post-Retirement Medical is provided for based on actuarial valuations, as at the Balance Sheet date. The following tables summaries the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the Balance Sheet for the above defined benefit plan.

A description of methods used for sensitivity analysis and its Limitations:

Sensitivity analysis is performed by varying a single parameter while keeping all the other parameters unchanged.

Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously.

The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change if any.

The Description on funding arrangements and funding policy

The Company has Purchased an Insurance policy to settle the Gratuity Payment to their employees. Company may do the contribution every years based on the funding valuation carry out by insurance company based on the latest data provided by Company.

A description of methods used for sensitivity analysis and its Limitations:

Sensitivity analysis is performed by varying a single parameter while keeping all the other parameters unchanged.

Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously.

The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change if any.

It was informed by the company that Post Retirement Medical Benefit liabilities of the company are Funded.

There are no minimum funding requirements for a Post Retirement Medical Benefit plan and there is no compulsion on the part of the Company to fully or partially pre-fund the liabilities under the Plan.

The trustees of the plan have outsourced the investment management of the fund to an insurance company. The insurance company in turn manages these funds as per the mandate provided to them by the trustees and the asset allocation which is within the permissible limits prescribed in the insurance regulations. Due to the restrictions in the type of investments that can be held by the fund, it may not be possible to explicitly follow an asset-liability matching strategy to manage risk actively in a conventional fund.

The Description on funding arrangements and funding policy

The Company has Purchased an Insurance policy to settle the Gratuity Payment to their employees. Company may contribute every years based on the funding valuation carried out by insurance company based on the latest data provided by Company.

Grant/Subsidy on NE Project:

1. The Company had undertaken projects of NE-1 and NE-2 with a total projected capital outlay of Rs. 45125 Lakhs for which anticipated subsidy of Universal Service Obligation Fund of Department of Telecommunication, Government of India was pegged at Rs. 38800 Lakhs and net cash outflow of Rs. 6325 Lakhs. Against this, the Company has incurred total capital expenditure of Rs. 28852 Lakhs (Net of Recovery) out of which material of an amount of Rs. 2718 lakhs have been transferred to other projects/regions. Company has received subsidy of Rs. 3146 Lakhs with a net cash outflow of Rs. 22988 Lakhs up to 31.03.2025. In the opinion of the management, the Company has complied with all the conditions set out for the subsidy and accordingly, there is no liability to refund the subsidy already received.

2. During the period ended 31.03.25, depreciation of Rs. 746 Lakhs (March'24 - Rs. 937 lakhs) have been charged to Statement of Profit and Loss due to capitalization and accordingly impact of amortization of subsidy is recognized in Statement of Profit and Loss for Rs.413 Lakhs (March'24 -Rs. 129 lakhs) in proportion to depreciation which is shown under the head other operating revenue.

Grant/Subsidy on Rural Wi-Fi:

The Company had received Rural Wi-Fi Subsidy amounting to Rs. 1653 lakhs up to 31.03.2025 from Department of Telecommunication (DoT-USOF) for installation of Wi-Fi in rural areas. An amount of Rs. 1513 lakhs have been capitalized up to 31.03.2025 on account of commissioning of wi-fi services at the stations. The Company has amortized an amount of Rs. 217 lakhs out of the subsidy received in proportion to the depreciation on assets capitalized and same has been recognized under the head other operating revenue.

48 Indian Accounting Standard (Ind AS) 24, Related Party Disclosures are as follows:

i) Government Related Entities : The Company is a Central Public Sector Enterprise (CPSE) under the Ministry of Railways. The Company is controlled by Government of India (GOI), by holding 72.84% of equity shares in the name of President of India as at 31st March, 2025. Pursuant to Para 25 and 26 of Ind AS 24, entities over which the same government has control or joint control of, or significant influence, then the reporting entity and other entities shall be regarded as related parties. Transactions with these parties are carried out at market terms at arm length basis. The company has applied the exemption available for government related entities and have made limited disclosures in the financial statements.

50 Indian Accounting Standard (Ind AS) 36, Disclosure on Impairment of Assets & Indian Accounting Standard (Ind AS) 113, Disclosure on Fair Value Measurement

Based on an impairment study, The Company has recognized the impairment loss amounting Rs. 1850 lakhs (March'24 - Rs. 1072 lakhs) during the current year in statement of profit and loss for NE Project. This project was halted for the long time due to difficult working conditions in north eastern region and various other reasons. The total impairment loss as at 31.03.2025 of Rs. 12097 lakhs (as at 31.03.24 Rs. 10247 Lakhs).

b. Contingent liabilities:

Contingent liabilities are determined based on available information. These liabilities are not provided for and are disclosed by way of notes on accounts.

* Hon'ble Supreme Court passed an order dated 11.06.2020 wherein it was held that definition of AGR as per the licenses given to the Public Sector Undertaking (PSUs) is different than the definition of AGR as per Universal Access Service License (UASL) given to other network service providers. It was also upheld that the Hon'ble Supreme Court Judgement dated 24.10.2019 never dealt with the issue of PSUs as their agreements are quite different and therefore, the judgement held on AGR issue could not have been made the basis for raising the demand against Public Sector Undertaking as they are not in the actual business of providing mobile services to the general Public. The Company filed an application to Ministry of Railways for settlement of the dispute through administrative Mechanism for resolution of CPSE dispute (AMRCD). The Committee of Secretaries (CoS) as part of AMRCD resolution has decided that RCIL being a PSU, be given the same treatment as other PSUs whose demand on non telecom revenue was withdrawn. Accordingly, assessment of license fee upto FY 23-24 has been finalised by DoT and amount of Rs. 987.71 Lakhs has been paid by the Company during current FY and charged to P&L A/c

(b) Bank Guarantees given by the Company to Customers/Government as on 31.03.2025 is Rs. 72395 lakhs (31.03.2024 - Rs. 67290 lakhs).

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52 Disclosure Requirements as per IND AS 108 - Operating Segments

The Company's principle business is to provide neutral telecom infrastructure. The Company operates within India and does not have operations in economic environment with different risks and returns. Hence, it is considered operating in Pan India-single geographical segment

The Company's operating segments are as follows:

1. Telecom Services -Department of telecommunication has provided licenses to Company, namely ILD, NLD, ISP and IP-1 registration for providing various type of telecommunication services in the country. RailTel with its expertise in Telecom & IT domain for over a decade offers an end-to-end managed data services to its customers within the framework of these licenses.

It provides a wide range of Telecom services to its customer as under:

1. Managed Data Services

2. Leased Line

3. Virtual Private Network

4. Internet Leased Line

5. Data Centre

6. Tower collocation

7. Rack and space

8. NLD for voice carriage

2. Project Work services- To generate revenue through its expertise in telecom field, Company has taken the following projects:

1. Telecom and IT services related projects

2. Enterprise specific IT & ITES Projects

3. Railway Signalling Work

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53 Indian Accounting Standard (Ind AS), Disclosure on Financial Instruments (107), Recognition, Measurement, and Classification (109), and Fair Value Measurement (113)

53.1 FINANCIAL ASSETS Trade receivables

As per Ind AS 109, Company is following simplified approach of expected credit loss model for recognizing the allowance for doubtful debts.

Security Deposits

There are some deposits which are being kept with government authorities e.g., commercial taxes department, Railways, Electricity etc. which are considered as financial asset. A period of 10 years has been assumed for discounting these items.

Investments

Company makes investment in liquid mutual funds which are fair valued based on the unit price prevailing as at the period end and consequent gain/loss is taken to the profit and loss A/c.

53.2 FINANCIAL LIABILITIES

Security Deposits, Retention Money and Earnest Money Deposit are classified as Financial Liabilities.

Valuation techniques and process used to determine fair values

i. The carrying value of financial assets and liabilities with maturity less than 12 months are considered to be representative of their fair value.

ii. Fair value of other financial assets and liabilities carried at amortized cost is determined by discounting of cash flows using discount rate.

iii. A discount rate of 6.45% (5 Year RBI Bond Rate) has been used for balances as on 31.03.2025.

Financial Risk Management

The Company has constituted Risk Management Committee in line with the requirement of Regulation 21 of the SEBI (LODR) Regulations, 2015 (as amended).

The role and responsibilities of Risk Management Committee is in line with the provisions of Regulation 21 of the SEBI (LODR) Regulations, 2015.

Risk Management frame work of the company is as follows:-

a. Apex level Risk Management committee

b. Functional Risk Management Committee

The Company has a risk management policy to identify and analyse the risks faced by the Company. The audit committee evaluates the internal financial controls and risk management system. The Audit Committee monitor the Risk assessment and minimization procedure across the company after review of the same by Risk Management Committee (Apex Level) The audit committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

The Company has exposure to the following risk from its use of financial instruments: -

1. Credit Risk

2. Liquidity Risk

3. Market Risk

4. Project Risk

5. Insurable Risk

6. Capital Management

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1. Credit Risk

Credit risk is the risk of financial losses to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligation and arises principally from the Company's trade receivables, employee loans and other activities that are in the nature of leases.

The Company assesses on a forward-looking basis the expected credit loss associated with its financial assets carried at amortized cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade receivables, the Company follows 'simplified approach' for recognition of impairment loss and always measures the loss allowance at an amount equal to lifetime expected credit losses. Further, for the purpose of measuring lifetime expected credit loss allowance for trade receivables, the Company has used a practical expedient as permitted under Ind AS 109 i.e. expected credit loss allowance as computed based on historical credit loss experience. Company have used the methodology of provisional matrix as per Ind AS 109 to compute the historical loss rate and adjust the impact of macroeconomic factors into the historical loss rate to compute the forward-looking rates.

Exposure to Credit Risk

In the current year, Company used expected credit loss model to assess the impairment loss or gain. The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix considers historical credit loss experienced and adjusted for forward-looking information. The expected credit loss allowance is based on ageing of the days the receivables are due. The trade receivables which share the similar credit risk characteristics have been taken into the one bucket. Hence, company has divided the trade receivable into two categories as follows:

• Government & PSU Customers

• Private Customers

The gross carrying amount of trade receivables and unbilled revenue, net of any impairment losses recognized represents the maximum credit exposure.

2. Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company reputation, typically the Company ensures that it has sufficient cash on demand to meet expected operational expenses, servicing of financial obligations.

3. Market Risk

Market risk is the risk of loss of future earnings or fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign exchange rates and other market changes that affect market risk sensitive instruments.

The Company makes investment in mutual fund which are subject to market risk. Hence, the investment is classified in the Balance Sheet at fair value through profit and loss (FVTPL) and resultant gain/loss on investment is classified as FVTPL. However, to manage the price risk, the Company invests in liquid funds and the level of the investments is insignificant in view of the level of the operation of the Company.

4. Project Risk

A project risk is an uncertain event that may or may not occur during a project. There is risk of time overrun/ cost overrun which is mitigated by ensuring time schedule for each activity of the project execution based on milestone and monitoring based on cost estimate..

5. Insurable Risk

Insurable Risks are mitigated based on definite policy of the company in regard to insurance of assets, material, Risks during Project execution, workmen and Directors and officers liability as decided by the company from time to time.

6. Capital Management

The Company manages its capital to ensure that the Company will be able to continue as a going concern, while maximizing the return to stakeholders through efficient allocation of capital towards expansion of business, optimization of working capital requirements and deployment of surplus funds. The Company uses the operational cash flows to meet its working capital requirements. The funding requirements are met through internal accruals. The Company is not subject to any externally imposed capital requirements.

54 Indian Accounting Standard (Ind AS) 115, Disclosure on Revenue from Contracts with Customers Disaggregation of Revenue

The company disaggregates revenue from contract with customer into categories that depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. In project business segment the company provides warranty to customer which is implicit in the contract revenue. The said warranty is provided by OEMs with back to back performance obligation and hence the company does not have additional obligation for warranty in addition to the same provided by OEMs. Since warranty is implicit in transaction price on back to back agreement with OEMs and hence not been accounted for separately.

The following table illustrates the disaggregation of disclosure by primary geographical region, major product line, market or type of customer, type of contract, contract duration, sales channel and timing of revenue recognition in accordance with Ind AS 115.

The Company's principal business is to provide neutral telecom infrastructure. The Company operates within India and does not have operations in economic environment with different risks and returns. Hence, it is considered operating in Pan India-single geographical segment.

The Company has been offering NLD Services, infrastructure services (Dark Fibers, Tower space and co-location etc.) under IP-I registration, ILD and Internet services under unified license to its customers under respective operating lease.

The Company has entered into a non-cancellable long-term lease arrangement to provide optical fiber on indefeasible right of use (IRU) basis. The lease rental receivable proportionate to actual kilometres accepted by the customer is credited to the statement of profit and loss on a straight - line basis over the lease term. Due to the nature of the transaction, it is not possible to compute gross carrying amount, depreciation for the period and accumulated depreciation of the asset given on operating lease and accordingly respective disclosures required by IND AS 116 are not provided.

In terms of contractual Clause of agreement, if the customer terminates the services of the link during minimum subscription period, RailTel shall refund or adjust (against the future orders) the already paid IRU charges after deducting the termination penalty.

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56 Other Disclosures

56.1 These Financial Statements are presented in Indian Rupees (INR) which is the Company's functional currency.

56.2 Figures have been rounded off to nearest Rupees in lakhs. Previous year figures have, wherever necessary, been rearranged/regrouped to conform the presentation of the Current year.

56.3 License fee to DoT and Railways Revenue Share computed at prescribed rate of 8% and 7% respectively.

56.4 Employees Benefit Expenses and Administrative Expenses are apportioned to project works based on 2% and 1% respectively of expenses incurred on projects.

56.5 The Current Assets/ Liabilities have been determined if they are receivable / payable within 1 year from the date of Balance Sheet. Rest has been treated as Non-Current.

56.6 Self-Insurance Reserve has been provided @ 0.12% p.a. on the Gross Block of Property, Plant & Equipment's installed at PoP's and customer premises to meet future losses which may arise from un-insured risks.

b. Revaluation of property, plant & equipment is as per Note 44 (6)

c. (a) No funds have been advanced or loaned or invested (either from borrowed funds or securities premium

or any other sources or kind of funds) by the company to or in any person(s) or entity(ies), including foreign entities ('the intermediaries'), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company ('the Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf the Ultimate Beneficiaries.

(b) No funds have been received by the company from any person(s) or entity(ies), including foreign entities ('the Funding Parties'), with the understanding, whether recorded in writing or otherwise, that the company shall, whether directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ('Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

d. The company does not hold any Benami property under the Benami Transactions (Prohibitions) Act, 1988 (45 of 1988) and the rules made thereunder.

e. The company has not been declared wilful defaulter by any bank or financial institution or other lender.

f. Dealing with Struck off Companies:

The details of struck off companies having transaction during the FY 2024-25:

g. The company does not have any charges or satisfaction yet to be registered with ROC beyond the statutory period.

h. The company do not have any investment in step down subsidiaries. Hence the Companies (Restriction on number of layers) Rules, 2017 are not applicable.

i. The company has complied with all the terms of the approved scheme(s) of arrangements for the amalgamation of RailTel Enterprises Limited (Transferor Company) with and into RailTel Corporation of India Limited (Transferee Company) as approved by MCA (Ministry of Corporate Affair) vide approval order dated

27.09.2023.

j. The company has not traded in crypto currency or virtual currency.

k. The company has complied with all the terms of the approved scheme(s) of arrangements for the amalgamation of RailTel Enterprises Limited (Transferor Company) with and into RailTel Corporation of India Limited (Transferee Company) as approved by MCA (Ministry of Corporate Affair) vide approval order dated

27.09.2023.

l. The company does not have any undisclosed income in the tax assessments under the Income tax Act, 1961.

1 Debt Service Coverage Ratio: due to addition of new lease (ROU) for Rs. 1938 Lakhs.

2 Net Capital Turnover Ratio: due to increase in working capital of the company.

3 Return on Investment: due to increase in return on liquid funds.

58 The Board of Directors in its meeting dated 01.05.2025 have approved the company's financial statements for the FY 2024-25. CMD and/or Director Finance of the company is authorised by the Board to make necessary correction/modification/alteration in the financial statements on behalf of the Board.