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Auditor Report of Aksh Optifibre Ltd.

Mar 31, 2015

We have audited the accompanying Standalone Financial Statements of AKSH OPTIFIBRE LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these Standalone Financial Statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Standalone Financial Statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matter's which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Financial Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Standalone Financial Statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the Standalone Financial Statements that give true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2015;

ii) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

2. Further, as required by section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books

c) The Balance Sheet, the Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid Standalone Financial Statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of written representations received from the directors as on 31st March, 2015, taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015, from being appointed as a director in terms of Section 164(2) of the Act.

f) with respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its Standalone Financial Statements – Refer Note 25 to the Standalone Financial Statements.

ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

As stated in Para 1 'Report on Other Legal and Regulatory Requirements' in Our Auditors' report on even date, the following statement is based on the comment in the Auditors report on Standalone Financial Statement.

1 (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) According to the information and explanation given to us fixed assets except the assets installed at customer premises have been physically verified by the management during the year. No material discrepancies were noticed on such verification. In our opinion, frequency of physical verification of fixed assets is reasonable.

2 (a) During the year, The Inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanation given to us. the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c ) In our opinion and according to the information and explanation given to us and on the basis of our examination of the records, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the book of accounts.

3 (a) The Company has granted unsecured loan to its subsidiaries, covered in the register maintained under Section 189 of Companies Act, 2013 ('the Act').

(b) In respect of loans granted to subsidiaries covered under section 189 of the Act, the terms of arrangement for payment of principal and interest are payable on demand. Accordingly, paragraph 3(iii)(a) is not applicable to the Company.

(c) In respect of the aforesaid advances, as per the information made available to us, there is no overdue amount exceeding Rupees One Lac as at year end.

4 In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any major weakness in internal controls.

5 In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from public to which the directives issued by Reserve Bank of India and provisions of sections 73 to 76 of the Companies Act, 2013, including rules framed there under, apply. Further, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any other tribunal.

6 We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub section (1) of section 148 the Companies, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

7 (a) According to the information and explanations given to us and according to the books and records produced before us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and Any Other Statutory Dues with the Appropriate Authority, as Applicable to it.

(b) According to the information and explanations given to us, there are no dues of Income Tax or Sales Tax or Wealth Tax or Service Tax or Duty of Customs or Duty of Excise or Value Added Tax or Cess which have not been deposited on account of any dispute except of the following amounts:-

Name of the Statute Nature of Dues Disputed amount (Rs. In lacs)

SALES TAX

Sales Tax Act Sales Tax Demand 41.63

Sales Tax Act MVAT Demand 7.85

CUSTOM

Customs Act, 1962 Duty, Interest & 408.97 Penalty

EXCISE

Central Excise Excise Duty, 84.38 Act, 1944 Interest & Penalty

Central Excise Excise Duty 32.79 Act, 1944

Central Excise Excise Duty 22.35 Act, 1944

SERVICE TAX

Finance Act, 1994 Service Tax 7.50

Finance Act, 1994 Service Tax 0.54

Finance Act, 1994 Service Tax 0.42

Finance Act, 1994 Service Tax 219.85 & Interest

Finance Act, 1994 Service Tax 0.91

Finance Act, 1994 Service Tax 1.94

PROVIDENT FUND

Provident Fund Act Provident Fund 7.60

Name of the Statute Period to which Forum where dispute amount is pending relates

SALES TAX

Sales TaxAct 2000-01 & 2001-02 Hon'ble High Court Jaipur

Sales Tax Act 2007-08 Joint Commissioner of Sales Tax (Appeals), Mumbai

CUSTOM

Customs Act 1962 2005-06 & CESTAT 2008-09

EXCISE

Central Excise 2003-05 & CESTAT Act 1944 2000-01

Central Excise 2011-12 Assistant Commissioner Act 1944 Bhiwadi

Central Excise 2010-11 Commissioner (Appeals) Act 1944 2004-05 Hon'ble High Court, Jaipur SERVICE TAX

Finance Act 1994 2005-06 Commissioner of Central Excise (Appeals), Jaipur

Finance Act 1994 2005-06 Deputy Commissioner

Finance Act 1994 2004-06, CESTAT 2009-10 & 2011-12

Finance Act 1994 2010-11 Assistant Commissioner, Bhiwadi

Finance Act 1994 2014-15 Commissioner (Appeals)

PROVIDENT FUND

Provident Fund Act 2004-05 Hon'ble High Court, Jaipur

(c) According to information and explanation given to us, Company has transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund within time

8 In our opinion, the accumulated losses of the Company are not equal to or more than fifty percent of its net worth as at year end and also the Company has neither incurred cash losses during the financial year covered by our audit nor in the immediately preceding financial year.

9 In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

10 According to the information and explanations given to us, the terms and condition on which Company has given the guarantee for loans taken by subsidiary from banks and financial institutions are not prejudicial to the interest of the Company.

11 In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were raised.

12 According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

for P.C. BINDAL & CO.

Chartered Accountants

Firm Registration No. 003824 N

CA .K.C. GUPTA

Place : New Delhi Partner

Date : May 30, 2015 Membership No: 088638


Mar 31, 2014

We have audited the accompanying financial statements of AKSH OPTIFIBRE LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s responsibility of financial statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the companies Act 1956 ("the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the ministry of corporate affairs in respect of Section 133 of the Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2014;

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13th September, 2013 of the ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

e) on the basis of written representations received from the directors as on 31st March, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2014, from being appointed as a director in terms of clause (g) of sub- section (1) of section 274 of the Companies Act, 1956.

ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As per information & explanation given to us fixed assets except the assets installed at customer premises have been physically verified by the management during the year. No material discrepancies were noticed on such verification. In our opinion, the frequency of physical verification of fixed assets is reasonable.

(c) During the year, the Company has not disposed off Substantial fixed assets. According to the information and explanation given to us, we are of the opinion that the going concern status of the Company is not affected.

(ii) (a) During the year, the inventory has been physically verified by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c ) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the books records were not material and have been properly dealt with in the books of accounts.

(iii) (a) According to the information and explanations given to us, the Company has granted unsecured loan to one of its wholly owned subsidiary. The maximum amount involved during the year was Rs. 14,174.60 lacs and the closing balance of loan given to such party was Rs. 8,501.07 lacs.

(b) According to the information and explanations given to us, in our opinion, the other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(c) As per the information made available to us, the aforesaid advance granted by the Company is repayable on demand.

(d) In respect of the aforesaid advances, there is not overdue amount as at year-end.

(e) According to the information and explanations given to us, the Company has taken unsecured loans from three parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 311.75 lacs and the closing balance of loan taken from such parties was Rs. 200 lacs.

(f) According to the information and explanations given to us, in our opinion, the rate of interest and other terms and conditions on which unsecured loans have been taken from Companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) According to the information and explanations given to us, the payments of the principal amount and interest of the aforesaid loan are regular.

(iv) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchases of inventory, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control system.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements need to entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from public to which provisions of sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

(vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) (a) According to the information and explanations given to us and according to the books and records examined by us, the Company is generally regular in depositing undisputed statutory dues in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues were in arrears, as at 31st March, 2014 for a period of more than six months from the date they become payable.

(c) According to the information and explanations given to us. and the records of the Company examined by us , dues of Income Tax, Sales Tax , Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess which have not been deposited on account of disputes and the forum where the dispute are pending as under :

Name of the Dues / Name Disputed Amount Period to Which Forum Where of the Statute (Rs. in lacs) Amount Relates Dispute is Pending

Sales Tax

Rajasthan Sales Tax 71.12 1996-97,1998-99, Hon''ble High Court Jaipur Demand 2000-01 and 2001-02

MVAT Demand 7.85 2007-08 Joint Commissioner of Sales Tax (Appeals), Mumbai

Customs/ Excise Duty

Customs Act, 1962 360.91 2005-06 CESTAT

Customs Act, 1962 48.06 2008-09 CESTAT

Central Excise Act, 1944 84.38 2003-05 CESTAT

Central Excise Act, 1944 3.37 2000-01 CESTAT

Central Excise Act, 1944 22.35 2010-11 Commissioner (Appeals)

Central Excise Act, 1944 0.31 2011-12 Commissioner (Appeals)

Service Tax

Finance Act, 1994 7.50 2004-05 Hon''ble High Court, Jaipur

Finance Act, 1994 0.54 2005-06 Commissioner of Central Excise (Appeals), Jaipur

Finance Act, 1994 0.64 2004-06 CESTAT

Finance Act, 1994 31.20 2009-10 CESTAT

Finance Act, 1994 188.01 2011-12 CESTAT

Finance Act, 1994 0.91 2010-11 Assistant Commissioner, Bhiwadi

Finance Act, 1994 0.42 2005-06 Deputy Commissioner

Provident Fund

Provident Fund Act 7.60 2004-05 Hon''ble High Court, Jaipur

(x) In our opinion, the accumulated losses of the Company are not more than fifty percent of its net worth. The Company has not incurred any cash losses during the current year and in the immediately preceding financial year.

(xi) Bonds of $ 13 Mn and $ 1Mn were due for redemption on 8th January, 2013 and 5th February, 2013 respectively having maturity value of equivalent to Rs. 7,603.40 lacs has been redeemed / paid on $1.50 Mn on 16th May, 2013, $2.50 mn on 21st May, 2013, $ 0.50 Mn on 23rd May, 2013 and $ 9.50 Mn on 27th June, 2013.

(xii) According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable to the Company.

(xiv)In our opinion and according to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments, Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

(xv) In our opinion, the terms and conditions on which the Company has given the guarantee for loans taken by subsidiary Company from banks or financial Institutions are not prejudicial to the interest of the Company.

(xvi) In our opinion, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii) According to the information and explanations given to us, the Company has not made preferential allotment of share to parties covered in the register maintained under section 301 of the Act.

(xix)According to the information and explanations given to us, during the year the Company has issued 0% Unsecured Foreign Currency Convertible Bonds of US$ 1,000 each aggregating to US$ 3.792 Million equivalent to Rs. 2,272.17 lacs and accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

(xx) According to the information and explanations given to us, the Company had not raised any money by way of public issue during the year.

(xxi) Based on the audit procedures performed and information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For P. C. Bindal & Co.

Firm Registration No. : 003824N Chartered Accountants

CA. K. C. Gupta Place of Signature: New Delhi Partner

Date: 26th May, 2014 Membership Number: 088638


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of AKSH OPTIFIBRE LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s responsibility of financial statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books

c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e) on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub- section (1) of section 274 of the Companies Act, 1956.

ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As per information & explanation given to us fixed assets except the assets installed at customer premises have been physically verified by the management during the year. No material discrepancies were noticed on such verification. In our opinion, the frequency of physical verification of fixed assets is reasonable.

(c) During the year, the company has disposed off some portion of Land and Building. According to the information and explanation given to us, we are of the opinion that the sale of the said part of Land & Building has not affected the going concern status of the company.

(ii) (a) During the year, the inventory has been physically verified by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c ) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the books records were not material and have been properly dealt with in the books of accounts.

(iii) (a) According to the information and explanations given to us, the Company has granted unsecured loan to one of its wholly owned subsidiary. The maximum amount involved during the year was Rs.13,758.89 Lacs and the closing balance of loan given to such party was Rs.13,758.89 Lacs.

(b) According to the information and explanations given to us, in our opinion, the other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(c) As per the information made available to us, the aforesaid advance granted by the company is repayable on demand.

(d) In respect of the aforesaid advances, there is no overdue amount as at year-end.

(e) According to the information and explanations given to us, the Company has taken unsecured loans from four parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 927.55 Lacs and the closing balance of loan taken from such parties was Rs 311.75 Lacs.

(f) According to the information and explanations given to us, in our opinion, the rate of interest and other terms and conditions on which unsecured loans have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) According to the information and explanations given to us, the payments of the principal amount and interest of the aforesaid loan are regular.

(iv) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control system.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements need to entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered ; and

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from public to which provisions of sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

(vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

(viii)We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1) (d) of the Companies, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) (a) According to the information and explanations given to us and according to the books and records examined by us, the Company is generally regular in depositing undisputed statutory dues in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues were in arrears, as at 31st March, 2013 for a period of more than six months from the date they become payable.

(c) According to the information and explanations given to us. and the records of the Company examined by us , dues of Income Tax, Sales Tax , Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess which have not been deposited on account of disputes and the forum where the dispute are pending as under :

Name of the Dues/ Name Disputed Amount Period to Which Forum Where of the Statute (Rs. in Lacs) Amount Relates Dispute is Pending

Sales Tax

AP VAT Demand 179.99 2005-06 The Commercial Tax Officer, Hyderabad

AP VAT Demand 2.46 2006-07 The Commercial Tax Officer, Hyderabad

Delhi VAT 0.54 2007-08 Commissioner (Appeals), Delhi

Rajasthan Sales Tax Demand 71.12 1996-97,1998-99, Hon''ble High Court Jaipur 2000-01 & 2001-02

MVAT Demand 7.85 2007-08 Joint Commissioner of Sales Tax (Appeals), Mumbai

Customs/ Excise Duty

Customs Act, 1962 360.91 2005-06 CESTAT

Customs Act, 1962 48.06 2008-09 CESTAT

Central Excise Act, 1944 92.14 2003-05 CESTAT

Central Excise Act, 1944 3.37 2000-01 CESTAT

Central Excise Act, 1944 32.79 2011-12 Additional Commissioner

Central Excise Act, 1944 0.31 2011-12 Commissioner (Appeals)

Service Tax

Finance Act, 1994 7.50 2004-05 Hon''ble High Court, Jaipur

Finance Act, 1994 5.54 2004-05 Commissioner of Central Excise (Appeals), Jaipur

Finance Act, 1994 0.64 2004-06 CESTAT

Finance Act, 1994 75.53 2006-08 Assistant Commissioner, Bhiwadi

Finance Act, 1994 31.20 2009-10 CESTAT

Finance Act, 1994 201.33 2011-12 CESTAT

Finance Act, 1994 0.42 2005-06 Deputy Commissioner

Provident Fund

Provident Fund Act 7.60 2004-05 Hon''ble High Court, Jaipur

(x) In our opinion, the accumulated losses of the company are not more than fifty percent of its net worth. The Company has not incurred any cash losses during the current year and in the immediately preceding financial year.

(xi) Bonds of $ 13 mn and $ 1mn were due for redemption on 8th January 2013 and 5th February, 2013 respectively having maturity value of equivalent to Rs. 7,603.40 Lacs. Pursuant to RBI approval for extension in due dates for repayment of FCCB''s, the Company is in process of redemption of FCCB''s.

(xii) According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii)In our opinion, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments, Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks and financial institutions.

(xvi) According to the information and explanations given to us, the Company has not availed any term loan during the year under audit.

(xvii)According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii)According to the information and explanations given to us, the Company has not made preferential allotment of share to parties covered in the register maintained under section 301 of the Act.

(xix)According to the information and explanations given to us, during the period covered by our audit report, the Company has issued 1% Unsecured Foreign Currency Convertible Bonds of $ 1000 each aggregating to $ 1.205 Million equivalent to Rs. 613.10 Lacs and accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

(xx) According to the information and explanations given to us, the Company had not raised any money by way of public issue during the year.

(xxi) Based on the audit procedures performed and information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For P. C. Bindal & Co.

Firm Registration No. : 003824N

Chartered Accountants

CA. K. C. Gupta

Place of Signature: New Delhi Partner

Date: 17th May, 2013 Membership Number: 088638


Mar 31, 2011

1. We have audited the attached balance sheet of Aksh Optifibre Limited as at 31st March, 2011 and. also the profit & loss account and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the annexure referred to above, we report that:

i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit;

ii) In our opinion, proper books of account as required by the law have been kept by the company, so far as appears from our examination of those books ;

iii) The balance sheet, profit & loss account, and cash flow statement dealt with by this report are in agreement with the books of account;

iv) In our opinion, the balance sheet, profit & loss account and cash flow statement dealt with this report comply with the accounting standards referred to in section 211(3C) of the Companies Act, 1956;

v) On the basis of the written representations received from the directors as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956 ;

vi) Attention is invited to the note 16 of schedule "L" regarding the opinion framed by the Company for non provision of investments and outstanding dues with one of its subsidiary.

vii) Subject to our comments in para (vi) above and their consequential effects on the net assets or operations (if any), quantum of which can not be ascertained, based on our audit on financial statement and to the best of our information and according to the explanations given to us, the said accounts read together with the Notes to Accounts- Schedule "L" give the information required by the Companies Act, 1956 in the manner so required andgive a true and fair view in conformity with accounting principles generally accepted in India:

a) In the case of Balance Sheet, of the state of affairs of the company as at 31st March, 2011;

b) In the case of Profit & Loss Account, of the loss of the company for the year ended on that date; and

c) In the case of the cash flow statement, of the cash flows for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF AKSH OPTIFIBRE LIMITED FOR THE YEAR ENDED ON 31st MARCH. 2011

(i) (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As per information & explanation given to us fixed assets except the assets installed at customer premises have been physically verified by the management during the year. No material discrepancies were noticed on such verification. In our opinion, the frequency of physical verification of fixed assets is reasonable.

(c) During the year, the company has not disposed off substantial / major part of fixed assets.

(ii) (a) During the year, the inventory has been physically verified by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical

verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the books records were not material and have been properly dealt with in the books of accounts.

(iii) (a) According to the information and explanations given to us, the company has granted interest free unsecured loan to two wholly owned subsidiaries. The maximum amount involved during the year was Rs. 10927.06 lacs and the closing balance of loan given to such parties was Rs. 10927.06 lacs.

b) According to the information and explanations given to us, in our opinion, the other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

c) As per the information made available to us, the aforesaid advance granted by the company is repayable on demand.

d) In respect of the aforesaid advances, there is no overdue amount as at year-end.

(e) According to the information and explanations given to us, the company has taken unsecured loans from five parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.. 2955.35 lacs and the closing balance of loan taken from such parties was Rs. 885.85 lacs.

(f) According to the information and explanations given to us, in our opinion, the rate of interest and other terms and conditions on which unsecured loans have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) According to the information and explanations given to us, the payments of the principal amount and interest of the aforesaid loan are regular.

(iv) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory, fixed assets, sale of goods and services. During the course of our audit, we have not

observed any major weaknesses in internal control system.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements need to entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered ; and

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from public to which provisions of sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

(vii) In our opinion, the company has an internal audit system commensurate with the size and nature of its business.

(viii) According to the information and explanations given to us and according to the books and records examined by us, the Central Government has not prescribed any specific Cost records for the company under clause (d) of Sub-section (1) of Section 209 of the Companies Act, 1956.

(ix) (a) According to the information and explanations given to us and according to the books and records examined by us, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales" Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues were in arrears, as at 31st March, 2011 for a period of more than six months from the date they become payable except Rs.3.92 Lacs relating to sales tax, 0.66 lacs to relating to service tax, and 0.35 lacs to relating to TDS.

(c) According to the information and explanations given

to us. and the records of the Company examined by us , dues of Income Tax, Sales Tax , Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess which have not been deposited on account of

disputes and the forum where the dispute are pending as under :

Name of the Statute Nature of Dues Amount (Rs.in lacs)

AP Vat Act Sales Tax Demand 181.01

Provident Fund Act Provident Fund 7.60

DVAT Act Sales Tax Demand 209.64



Name of the Statute Year to which Forum where Amount Relates dispute is pending

AP Vat Act 2005-06 Honble High Court, Hyderabad

Provident Fund Act 2004-05 Honble High Court, Jaipur

DVAT Act 2007-08 Commissioner (Appeals)

(x) In our opinion, the accumulated losses of the company are not more than fifty percent of its net worth. The Company has incurred cash loss during the year covered by our audit and also in the immediately preceding financial year.

(xi) Bonds of $ 1 mn having maturity value of $ 1.205mn equivalent to Rs. 541 lacs issued in pursuant of the redemption of FCCBs amounting $ 1 mn redeemable as on 29th January, 2010 are still outstanding as on the balance sheet date.

(xii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable to the company.

(xiv) In our opinion and according to the information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments, Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the company.

(xv) According to the information and explanations given to us, the company has given corporate guarantee for securing working capital facilities sanctioned to its wholly owned subsidiary i.e. Aksh Technologies Limited amounting to Rs. 6,055 lacs. In our opinion issuance of such guarantee is not prejudicial to the interest of the company.

(xvi) According to the information and explanations given to us, the company has not availed any term loan during the year under audit.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short- term basis have been used for long-term investment.

(xviii) According to the information and explanations given to us, the company has not made preferential allotment of share to parties covered in the register maintained under section 301 of the Act.

(xix) According to the information and explanations given to us, the company had not issued any debentures during the year.

(xx) According to the information and explanations given to us, the company had not raised any money by way of public issue during the year.

(xxi) Based on the audit procedures performed and information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.



For P.C. BINDAL & CO. Chartered Accountants FRN: 003824N



CA.K.C. GUPTA Partner Membership No: 088638

Place : New Delhi Date : 21.05.2011






Mar 31, 2010

1. We have audited the attached balance sheet of Aksh Optifibre Limited as at 31st March, 2010 and also the profit & loss account and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the annexure referred to above, we report that:

i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit;

ii) In our opinion, proper books of account as required by the law have been kept by the company, so far as appears from our examination of those books ;

iii) The balance sheet, profit & loss account, and cash flow statement dealt with by this report are in agreement with the books of account;

iv) In our opinion, the balance sheet, profit & loss account and cash flow statement dealt with this report comply with the accounting standards referred to in section 211(3C)of the Companies Act, 1956 ;

v) On the basis of the written representations received from the directors as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2010 from being appointed as a director in terms of clause (g)of sub section (1) of section 274 of the Companies Act, 1956;

vi) Subject to above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Notes to Accounts-Schedule "N" give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India:

a) In the case of Balance Sheet, of the state of affairs of the company as at 31st March, 2010;

b) In the case of Profit & Loss Account, of the loss of the company for the year ended on that date; and

c) In the case of the cash flow statement, of the cash flows for the year ended on that date.

(i) (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As per information & explanation given to us fixed assets except the assets installed at customer premises have been physically verified by the management during the year. No material discrepancies were noticed on such verification. In our opinion, the frequency of physical verification of fixed assets is reasonable.

(c) The Company has transferred its manufacturing division to its wholly owned subsidiary from the appointed date of April 1, 2009 and accordingly has transferred all fixed assets except land & building pertaining to manufacturing division. According to the information and explanation given to us, we are of the opinion that the transfer of such fixed assets to its wholly owned subsidiary company has not effected the going concern status of the company.

(ii) (a) During the year, the inventory has been physically verified by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the books records were not material and have been properly dealt with in the books of accounts.

(iii) (a) According to the information and explanations given to us, the company has granted interest free unsecured loan to one wholly owned subsidiary. The maximum amount involved during the year was Rs. 89.70 lacs and the closing balance of loan given to such party was Rs. 89.70 lacs.

b) According to the information and explanations given to us, in our opinion, the other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

c) As per the information made available to us, the aforesaid advance granted by the company is repayable on demand.

d) In respect of the aforesaid advances, there is no overdue amount as at year-end.

(e) According to the information and explanations given to us, the company has taken unsecured loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.1,933.25. lacs and the closing balance of loan taken from such parties was Rs. 1,933.25 lacs.

(f) According to the information and explanations given to us, in our opinion, the rate of interest and other terms and conditions on which unsecured loans have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) According to the information and explanations given to us, the payments of the principal amount and interest of the aforesaid loan are regular.

(iv) In our opinion and according to the information and . explanation given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control system.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements need to entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered ; and

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from public to which provisions of sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

(vii) In our opinion, the company has an in-house internal audit system commensurate with the size and nature of its business.

(viii) As the Company has transferred the manufacturing division to its wholly owned subsidiary and is now operating in service sector, accordingly clause 4(viii) of Companies (Auditors Report) Order, 2003(as amended) regarding maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 is not applicable.

(ix) (a) According to the information and explanations given to us and according to the books and records examined by us, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues were in arrears, as at 31st March, 2010 for a year of more than six months from the date they become payable except Rs.3.92 Lacs relating to sales tax, 0.66 lacs to relating to service tax.

(c) According to the information and explanations given to us and the records of the Company examined by us , dues of Income Tax, Sales Tax , Wealth Tax,

(x) In our opinion, the accumulated losses of the company are not more than fifty percent of its net worth. The Company has incurred cash loss during the year covered by our audit and also in the immediately preceding financial year.

(xi) Based on our audit procedures and on the basis of information and explanations given by the management, FCCBs amounting to $ 6.25mn were due for redemption on 29th January, 2010. Pursuant to RBI approval, FCCBs aggregating $ 5.25 mn having maturity value of $ 6.328 mn equivalent to Rs. 2,946 lacs were redeemed by issuing fresh FCCB in exchange thereof on 5th February, 2010. Bonds of $ 1 mn having maturity value of $ 1.205mn equivalent to Rs. 541 lacs are outstanding as on the balance sheet date.

(xii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable to the company.

(xiv) In our opinion and according to the information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments, Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the company.

(xv) According to the information and explanations given to us, the company has given corporate guarantee for securing working capital facilities sanctioned to its wholly owned subsidiary i.e. Aksh Technologies Limited amounting to Rs. 6,055 lacs. In our opinion issuance of such guarantee is not prejudicial to the interest of the company.

(xvi)According to the information and explanations given to us, the company has not availed any term loan during the year under audit.

(xvii)According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short- term basis have been used for long-term investment.

(xviii)According to the information and explanations given to us, the company has not made preferential allotment of share to parties covered in the register maintained under section 301 of the Act.

(xix) According to the information and explanations given to us, during the year the company has issued 1% Unsecured Foreign Currency Convertible Bonds of US$ 1,000 each aggregating to US$ 6.328 Million equivalent to Rs. 2,946 lacs and accordingly, the provisions of clause 4(xiv) of the companies (Auditors Report) order, 2003(as amended) are not applicable to the company.

(xx) The company has not raised any money by way of public issue during the year.

(xxi)Based on the audit procedures performed and information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.



ForP.C.BINDAL&CO.

Chartered Accountants

CA.K.C. GUPTA

Partner

Membership No. : 088638

FRN: 003824N

Place: New Delhi Date : 17.05.2010

 
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