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Auditor Report of Alankit Ltd.

Mar 31, 2013

Report on Financial Statements

We have audited the accompanying financial statements of EURO FINMART LIMITED, 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 for the 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. 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 ofthe Statement of Profitand Loss, the profit for the year ended on that date and

c] in the case ofthe Cash Flow Statement, ofthe 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 issued by the Central Government of India in terms of sub-section (4A] of section 227 ofthe Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 ofthe Order.

2. As required by section 227(3] ofthe Act, we reportthat:

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.

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of EURO FINMARTLIMITED on the accounts of the company for the year ended 31st March, 2013.

On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that:

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

[b] As explained to us, fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

[c] In our opinion and according to the information and explanations given to us, the company has disposed off all the assets held by the company however, it does not affect the going concern assumption.

2. In respect of inventories:

[a] As explained to us, inventories have been physically verified during the year by the management at reasonable intervals.

[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 on the basis of our examination of the records, the Company is generally maintaining proper records of its inventories. No material discrepancy was noticed on physical verification of stocks by the management as compared to book records.

3. (a] According to the information and explanations given to us and on the basis of our examination of the Books of account, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, the provisions of clauses 3(b], 3(c] and 3(d] of the order are not applicable to the Company. [b] According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not taken loans from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Thus sub clauses (f) & (g] are not applicable to the company.

4. In our opinion and according to the information and explanations given to us, there is generally an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventories & fixed assets and payment for expenses & for sale of goods.

5. Based on the audit procedures applied by us and according to the information and explanations provided by the management, the company has not entered into any transactions that need to be entered in register in pursuance of Section 301 of the Act and as such clause 5 (b] of the Order is not applicable to the company.

6. The Company has not accepted any deposits from the public covered under section 58A and 58AA of the Companies Act, 1956.

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

8. The Central Government of India has not prescribed the maintenance of cost records under clause (d] of sub-section (1] of section 209 of the Companies Act 1956 for any of the services rendered by company.

9. (a] According to the records of the company, 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 to the extent applicable and any other statutory dues have generally been regularly deposited with the appropriate authorities. According to the information and explanations given to us there were no outstanding statutory dues as on 31st of March, 2013 for a period of more than six months from the date they became payable. [b] According to the information and explanations given to us, there is no amounts payable in respect of income tax, wealth tax, service tax, sales tax, customs duty and excise duty which have not been deposited on accountof any disputes.

10. The Company does not have any accumulated losses but has incurred cash loss during the financial year covered by our audit and in the immediately preceding financial year.

11. Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that, the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

12. 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.

13. The Company is not a chit fund or a nidhi /mutual benefit fund/society Therefore, the provision of this clause of the Companies (Auditor''s Report] Order, 2003 is not applicable to the Company.

14. According to information and explanations given to us, the Company is trading in Shares, Mutual funds & other Investments.The company is maintaining separate records of the transactions and contracts and making timely entries therein. The shares and other investments are held by the company in its own name.

15. According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution.

16. Based on our audit procedures and on the information given by the management, we report that the company has not raised any term loans during the year.

17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31st March, 2013, we report that no funds raised on short-term basis have been used for long-term investment by the Company.

18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year.

19. The Company has no outstanding debentures during the period under audit.

2 0. The Company has not raised any money by public issue during the year.

21. Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management.

For KRISHAN K. GUPTA & CO.

Chartered Accountants

FRN. 000009N

Sd/-

K.K. GUPTA

Proprietor

Membership No. 8311

DATED: 30™ MAY, 2013

PLACE: NEW DELHI


Mar 31, 2012

We have audited the annexed Balance Sheet of EURO FINMART LIMITED as at March 31, 2012 and also the Profit & Loss Account of the company for the year ended on that date annexed thereto and Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

1. 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

3. Further to our comments in the Annexure referred to in paragraph 2 above, 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 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, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account:

d) In our opinion the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the mandatory Accounting Standards referred in sub-section (3C) of section 211 of the Companies Act, 1956:

e) On the basis of written representation, received from Directors as on March 31, 2012 and taken on record by the Board of Directors, we report that, none of the Directors is disqualified as on March 31, 2012 from being appointed as a Director in terms of section 274(1)(g) of the Companies Act, 1956.

f) 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 Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required and present a true and fair view, in conformity with the accounting principles generally, accepted in India.

i) In so far as it relates to Balance Sheet, of the state of affairs of the Company as at March 31, 2012:

ii) In so far as it relates to the Profit and Loss Account, of the profit of the Company for the year ended on that date: and

iii) In so far as it relates to the Cash Flow Statement, of the cash flow of the company for the year ended on that date.

ANNEXURE TO AUDITORS' REPORT FOR THE YEAR ENDED 31st MARCH, 2012

(Referred to in Paragraph 2 of our report of even date)

1. In respect of its fixed assets:

a. The company has maintained proper records, showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b. As explained to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

c. In our opinion, the company has not disposed off substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year.

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. The company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventory, as compared to the book records.

3. In respect of loans, secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

a. On the basis of the records of the company, the following are the particulars of loan taken by the company from companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956;

Name of the Party Relationship with the Company Maximum Amount (Rs.) Year end Balance (Rs.)

Diwakar Commercials Associate Company 22,20,000.00 22,20,000.00 Pvt. Ltd.

b. On the basis of the records of the company, the company has not granted any loan to companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal controls.

6. In respect of transactions covered under Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements that needed to be entered into in 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, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000 (Rs. Five Lacs only) or more in respect of any party.

7. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

8. In our opinion, the internal audit system of the company is commensurate with its size and nature of its business.

9. In our opinion and as per information given to us, the company is not involved in manufacturing activities, hence maintenance of Cost Records prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 is not applicable to the company.

10. In respect of statutory dues:

a. In our opinion and according to the information and explanations given to us, the provisions of Provident Fund Act and Employees State Insurance Act are not applicable to the company.

b. In our opinion and according to the information and explanations given to us, the company has no disputed statutory dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty/Cess Payable, which have not been deposited.

11. The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in the immediate preceding financial year.

12. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

13. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the company on the basis of security by way of pledge of shares, debentures and other securities.

14. In our opinion and according to the information and explanation given to us, the company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, clause 4(xiii) of the Companies (Auditor's Report) order 2003 is not applicable to the company.

15. In our opinion and according to the information and explanations given to us, the company has invested its funds in shares, debentures and other securities.

16. According to the information and explanations given to us, the company has not given any guarantees for loans taken by others from banks or financial institutions.

17. The company has not raised any new term loans during the year. There were no term loans outstanding at the beginning of the year, which could have been applied for the purposes for which they were obtained.

18. During the year, the company has made allotment of Equity Shares to parties and companies in the Register maintained Under Section 301 of the Companies Act, 1956.

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

20. In our opinion and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year, that causes the financial statements to be materially misstated.

For and on behalf of

KRISHAN K. GUPTA & CO.

Chartered Accountants

-Sd/-

(K.K. GUPTA)

Prop. (M. No. 8311)

FRN - 000009N

DATED: 30th May, 2012

PLACE: New Delhi


Mar 31, 2010

We have audited the annexed Balance Sheet of EURO FINMART LIMITED (Earlier known as Euro Gold Jewellery Limited) as at March 31, 2010 and also the Profit & Loss Account of the company for the year ended on that date annexed thereto and Cash Flow Statement for the year ended on that date. 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.

1. 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

3. Further to our comments in the Annexure referred to in paragraph 2 above, 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 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, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account:

d) In our opinion the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the mandatory Accounting Standards referred in sub-section (3C) of section 211 of the Companies Act, 1956:

e) On the basis of written representation, received from Directors as on March 31, 2010 and taken on record by the Board of Directors, we report that, none of the Directors is disqualified as on March 31,2010 from being appointed as a Director in terms of section 274( 1 )(g) of the Companies Act, 1956.

f) 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 Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required and present a true and fair view, in conformity with the accounting principles generally, accepted in India.

i) In so far as it relates to Balance Sheet, of the state of affairs of the Company as at March 31,2010:

ii) In so far as it relates to the Profit and Loss Account, of the profit of the Company for the year ended on that date: and

iii) In so far as it relates to the Cash Flow Statement, of the cash flow of the company for the year ended on that date.

ANNEXURE TO AUDITORS REPORT FOR THE YEAR ENDED MARCH 31, 2010 Referred to in Paragraph 2 of our report of even date

1. In respect of its fixed assets:

a. The company has maintained proper records, showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b. As explained to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

c. In our opinion, the company has not disposed off substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year.

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. The company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventory, as compared to the book records.

3. In respect of loans, secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

a. On the basis of the records of the company, the followings are the particulars of loan taken by the company from companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956;

Name of Party Relationship with Company Maximum Amount Rs. Year end Balance Rs. Diwakar Commercials Pvt. Ltd. Associate Company 53,23,148.00 NIL

b. On the basis of the records of the company, the followings are the particulars of loan granted by the company to companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956;

Name of Party Relationship with Company Maximum Amount Rs. Year end Balance Rs. Diwakar Commercials Pvt. Ltd. Associate Company 31,76,852.00 NIL

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal controls.

6. In respect of transactions covered Under Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered into in 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, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000 (Rupees Five Lacs only) or more in respect of any party.

7. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

8. In our opinion, the internal audit system of the company is commensurate with its size and nature of its business.

9. In our opinion and as per information given to us, the Central Government has not prescribed maintenance of Cost Records under section 209(1 )(d) of the Companies Act, 1956 in respect of manufacturing activities, if any, of the company.

10. In respect of statutory dues:

a. In our opinion and according to the information and explanations given to us, the provisions of Provident Fund Act and Employees State Insurance Act not are applicable to the company.

b. In our opinion and according to the information and explanations given to us, the company has no disputed dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty/Cess Payable, which have not been deposited.

11. The Company has no accumulated losses and has not incurred cash losses during the financial year covered by our audit or in the immediate preceding financial year.

12. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

13. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the company on the basis of security by way of pledge of shares, debentures and other securities.

14. In our opinion and according to the information and explanation given to us, the company is not a chit fund or a nidhi/mutual benefit fund/ society. Therefore, clause 4(xiii) of the Companies (Auditors Report) order 2003 is not applicable to the company.

15. In our opinion and according to the information and explanations given to us, the company has invested its funds in shares, debentures and other securities.

16. According to the information and explanations given to us, the company has not given any guarantees for loans taken by others from banks or financial institutions.

17. The company has not raised any new term loans during the year. There were no term loans outstanding at the beginning of the year, which could have been applied for the purposes for which they were obtained.

18. During the year, the company has made allotment of Preference Shares to parties and companies in the Register maintained Under Section 301 of the Companies Act, 1956.

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

20. In our opinion and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year, that causes the financial statements to be materially misstated.

For Krishan K. Gupta & Co. Chartered Accountants -sd/- (Krishan Kumar) Proprietor Membership No. 8311 Place : New Delhi Date : 25.05.2010


Mar 31, 2009

We have audited the annexed Balance Sheet of EURO GOLD JEWELLERY LIMITED for the period ended March 31,2009 and also the Profit & Loss Account of the company for the period 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,

1. 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

3. Further to our comments in the Annexure referred to in paragraph 2 above, 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 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, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account:

d) In our opinion the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the mandatory Accounting Standards referred in sub-section (3C) of section 211 of the Companies Act, 1956;

&) On the basis of written representation, received from Directors as on March 31, 2009 and taken on record by the Board of Directors, we report that, none of the Directors is disqualified as on March 31,2009 from being appointed as a Director in terms ofsection274(l)(g) of the Companies Act, 1956 and

f) 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 Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, In the manner so required and present a true and fair view, in conformity with the accounting principles generally, accepted in India,

i) In so far as it relates to Balance Sheet, of the state of affairs of the Company for the period ended March 31,2009:

ii) In so far as it relates to the Profit and Loss Account, of the loss of the Company for the year ended on that date; and

iii) In so far as it relates to the Cash Flow Statement, of the cash flow of the company for the year ended on that date.

ANNEXURE TO AUDITORS REPORT FOR THE PERIOD ENDED MARCH 31, 2009 Referred to in Paragraph 2 of our report of even date

1. In respect of its fixed assets:

a. The company has maintained proper records, showing full particulars including quantitative details and situation of fixed assets on the basis of available information,

b. As explained to us, the fixed assets have been physically verified by the management during the period in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

c. In our opinion, the company has not disposed off substantia! part of its fixed assets during the period under report and the going concern concept is not affected.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular Intervals during the year.

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. The company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventory, as compared to the book records.

3. a. In our opinion and according to the explanations given to us, the company has not granted any loan, secured or unsecured to the

companies, firms or other parties covered In the register maintained under section 301 of the Act and as such clauses (iii) (b), (lii) (c) and (iii) (d) of the Order are not applicable to the company.

b. On the basis of the records of the company, the following are the particulars of loans taken by the company from companies, firms and other parties covered in the register maintained under section 301 of the companies Act, 1956,

Name of Party Relationship with Company Maximum Amount Rs. Year end Balance Rs.

Diwakar Commercials Pvt. Ltd. Associate Company 61,10,000 37,33,148

c. On the basis of the records of the company, the followings are the particulars of loan granted by the company to companies, firms and other parties covered in the register maintained under section 301 of the companies Act, 1956.

Name of Party Relationship with Company Maximum Amount Rs. Year end Balance Rs.

Dlwakar Commercials Pvt. Ltd. Associate Company 4,00,000 --

d. In ouropinion the rate of interest and other terms and conditions on which loans, have been taken from/granted to companies, firm or other parties listed in the registers maintained under section 301 of the Companies Act, 1956 are prima facie, not prejudicial to the interest of the company.

e. In our opinion and according to information and explanation given to us, the loans taken/granted are repayable on demand and no demanded amount is outstanding. In view of (iii) (c) above, in our opinion, there is no overdue amount in respect of payable of the principal and interest.

4. In our opinion and according to the information and explanations given to us, there are adequate Internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. In respect of transactions covered Under Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered into in 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, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the period to Rs. 5,00,000 {Rupees Five Lacs only) or more in respect of any party.

6. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

7. In our opinion, the internal audit system of the company is commensurate with its size and nature of its business.

8. In our opinion and as per information given to us, the Central Government has not prescribed maintenance of Cost Records under section 209(1 )(d) of the Companies Act, 1956 in respect of manufacturing activities, if any, of the company.

9. In respect of statutory dues:

a. In our opinion and according to the information and explanations given to us, the provisions of Provident Fund Act and Employees State Insurance Act not are applicable to the company.

b. In our opinion and according to the information and explanations given to us, the company has no disputed dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty/Cess Payable, which have not been deposited.

10. In our opinion and according to the information and explanations given to us, the Company has accumulated tosses and has incurred cash losses during the period covered by our audit or in the immediate preceding financial year,

11. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

12. in our opinion and according to the Information and explanation given to us, no loans and advances have been granted by the company on the basis of security by way of pledge of shares, debentures and other securities,

13. In our opinion and according to the information and explanation given to us, the company is not a chit fund or a nidhi/mutual benefit fund/ society. Therefore, clause 4{xiii) of the Companies (Auditors Report) order 2003 is not applicable to the company.

14. In our opinion and according to the Information and explanations given to us, the company has invested its funds in shares, debentures and other securities.

15. According to the information and explanations given to us, the company has not given any guarantees for loans taken by others from banks or financial institutions.

16. The company has not raised any new term loans during the period. There were no term loans outstanding at the beginning of the year, which could have been applied for the purposes for which they were obtained.

17. During the period, the company has not made any preferential allotment of shares to parties and companies in the Register maintained Under Section 301 of the Companies Act, 1956.

18. The company has not raised any money by way of public issue during the period.

19. In our opinion and according to the Information and explanations given to us, no fraud on or by the company has been noticed or reported during the period, that causes the financial statements to be materially misstated.

For Krishnan K. Gupta & Co. Chartered Accountants

sd/-

(Krishan Kumar)

Proprietor

Membership No. 8311

Place : New Delhi

Date : 29.06.2009



 
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