Auditor Report of Anka India Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of ANKA INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at March 31,2014 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 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 notified under the Companies Act, 1956("theAct") 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. 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 entity''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 March 31,2014;

b) in the case of the Profit and Loss Account, of the loss 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

bb) **The report on the accounts of the branch offices audited under section 228 by a person other than the company''s auditor has been forwarded to us as required by clause (c) of sub-section (3) of section 228 and have been dealt with in preparing our report in the manner considered necessary by us.

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, the Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards notified under the Companies Act, 1956 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 March 31,2014 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441Aof the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURE TO THE AUDITORS REPORT

REFERRED TO IN PARAGRAPH 1 OF OUR REPORT TO THE MEMBERS OF ANKA INDIA LIMITED ("THE COMPANY") FOR THE YEAR ENDED ON 31st MARCH, 2014

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, no fixed asset has been disposed during the year and therefore does not affect the going concern assumption.

2. (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 iii (b), iii(c) and iii (d) of the order are not applicable to the Company.

(b) clauses iii (b) of the order are not applicable to the Company.

(c) clauses iii(c) of the order are not applicable to the Company.

(d) clauses iii (d) of the orderare not applicable to the Company

(e) The Company has taken loans from one party covered in the register maintained under section 301 of the Companies Act, 1956 wherein the balance payable as at the year end is Rs. 2,63,86,575/-. The maximum amount outstanding during the year was Rs. 2,89,64,575/-.

(f) In our opinion, the rate of interest and other terms and conditions on which the loans have been taken to the parties listed in the register maintained under Section 301 of the Act are not, prima facie, prejudicial to the interest of the Company.

(g) In our opinion and according to the explanations given to us, the company is regular in paying the principal and interest as stipulated.

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. During the course of our audit, no major instance of continuing failure to correct any weaknesses in the internal controls has been noticed.

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) As per information & explanations given to us and in our opinion, no transaction have been entered into by the company with parties covered u/s 301 of the Act further it does not exceeds five lacs rupees in a financial year therefore requirement of reasonableness of transactions does not arises.

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. As per information & explanation given by the management, maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act.

9. (a) According to the records of the Company and the information and explanations given to us, it has been observed that there have been delays on some occasions in depositing of TDS with appropriate authorities. However the same has been deposited along with the interest as prescribed.

(b) According to the information and explanations given to us, the details of dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess which have not been deposited on account of any dispute are given below:-

Name of Nature of Financial year to Amount Statute Dues which the matter (Rs.) pertains Central Excise Act Penalty 1997-98 188319/-

Name of Forum where dispute is pending Statute Central Excise Act Customs Excise & Service Tax Appellate Tribunal

10. The Company has accumulated losses exceeding fifty percent of the net worth of the Company. The Company has incurred cash loss during the year covered by our audit.

11. In our opinion and according to 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, as applicable to the company.

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, is not applicable to the Company.

14. According to information and explanations given to us, the Company is not dealing or trading in Shares, securities, debentures and other investments.According the provisions of clause 4(xiv) of the Order is not applicable to the company.

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, the company has not taken any term loan 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,2014 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 to parties and companies covered in the register maintained under section 301 of the Companies Act.

19. The Company has not issued any secured outstanding debentures during the period.

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

21. According to 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. H. KUMAR & ASSOCIATES CHARTERED ACCOUNTANTS Firm Regn. No. 021518N

Sd/- PLACE : NEW DELHI (H. Kumar) DATED : 29th May''2014 M. NO. :010431

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Mar 31, 2013

1. We have audited the attached Balance Sheet of ANKA INDIA LIMITED, as at 31st March, 2013 and statement of 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 Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the 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 the 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 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of audit, 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 in paragraph 3 above, we report that:

a) subject to our comments in paragraphs 4(f)(1) to 4(f) (Hi) below, 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, 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, the statement of Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956 except for non-compliance of Accounting Standard 15 on "Employee''s Benefits" with respect to actuarial valuation of gratuity liability and hence disclosures required there under (refer Note No.18.1x)

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

f) in our opinion and to the best of our information and according to the explanations given to us and subject to:

i) Note No. ''28''regarding non-confirmation / reconciliation of balances of debtors, creditors and other parties, the effect of which on accounts upon confirmation and reconciliation not ascertainable;

it) Note No. ''34''regarding the accounts of the Company prepared on going concern basis;

Hi) Note No. ''18.1'' regarding non-provision of gratuity liability on the basis of actuarial valuation, effect of which on accounts has not been ascertained and read with other notes thereon, give the information required by the Companies Act, 1956, 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 at31sl March, 2013; ii) in the case of the statement of Profits Loss Account, of the loss 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.

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

b) As explained to us, physical verification of fixed assets was conducted by the management at the end of the year which in our opinion is reasonable having regard to the size of the Company and nature of its business. No discrepancies were noticed on the aforesaid verification.

c) The Company has disposed of all the fixed assets during the year,

2. a) As per the information and explanation given to us, the inventories have been physically verified by the management during the year. In our opinion, the frequency of physical verification is reasonable.

b) I n 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) On the basis of our examination of the records of inventory and according to the information and explanations given to us, we are of the opinion that the Company has maintained proper records of inventory. As per information and explanation given to us no discrepancy was observed on physical verification.

3. (a) As per information and explanation given to us the company has not granted any loan to the companies, firms of other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) The company has taken interest free secured loan aggregating to Rs. 90,78,175/- in the earlier years from one party covered in the register maintained u/s 301 of the Companies Act, 1956. A balance of Rs. 2,80,24,575/- was outstanding as on 31st March 2013 out of that loan.

(c) In our opinion and according to the information and explanations given to us the terms and conditions of interest free secured loan taken are not prima facie prejudicial to the interest of the company:

(d) In our opinion and according to the information and explanations given to us the payment of principal amount was regular as stipulated.

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

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the contracts and arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

b) No transactions were made 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/-or more in respect of each party except for issue of Redeemable Preference Shares as stated in (18) below.

6. The Company has not accepted any deposit from public during the year within the meaning of sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules framed there under.

7. The Company has an internal audit system which commensurate with the size of the Company and the nature of its business.

8. We have been informed that the Central Government has not prescribed maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 for the product of the Company,

9. a) According to the records of the Company and the information and explanations given to us, the Company has made delays on various occasions in depositing, with appropriate authorities, undisputed statutory dues including investor Education & Protection Fund, Provident Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Custom Duty, Cess and other statutory dues

b) According to the information and explanations given to us, the details of dues of Sales Tax, Income Tax. Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess which have not been deposited on account of any dispute are given below:-

Name of Nature of Financial year to Amount Forum where dispute is pending Statute Dues which the matter (Rs.) pertains

Central Excise Act Penalty 1997-98 188319/- Customs Excise & Service Tax Appellate Tribunal

HVAT Sales Tax 2006-07 182760/- Excise & Taxation Commissioner (Appeals)

10. The Company has accumulated losses exceeding fifty percent of the net worth of the Company. The Company has incurred cash profit during the year covered by cur audit by way of sale of fixed assets.

11. According to the information and explanation given to us, the Company has not defaulted in repayment of dues to financial institution and banks during the year. The company has not issued any debentures.

12. According to information and explanations given to us and based on the records produced to us, the Company has not granted loans and advances on the basis of securities by way of pledge of shares, securities, debentures and other investments.

13. in our opinion the Company is nota chit fund or Nidhi/mutual benefit fund/society,

14. In our opinion and according to the information and explanation given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanation given to us, the Company has not guaranteed any loan taken by others from banks and financial institutions,

16. No term loan has been taken during the year.

17. In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, were port that of ends raised on short term basis were used furlong term investment.

18. In our opinion and according to the information and explanations give to us, the price at which the Company has made the preferential allotment of redeemable preference shares to parties covered in the register maintained under section 301 of the Companies Act, 1956, during the year, was not prima facie prejudicial to the interest of the company.

19. The Company did not have any outstanding debentures during the year.

20. The Company has not raised any money by a public issue during the year.

21. Based upon the audit procedures performed and according to the information and explanations given to us, we report that no fraud on/or by the Company has been noticed or reported during the course of our audit for the year ended 31st March.2013.

For. H. KUMAR & ASSOCIATES

CHARTERED ACCOUNTANTS

FirmRegn. No. 021518N



Sd/-

PLACE : NEW DELHI (H- Kumar)

DATED : 12th JUNE 2013 M- NO. :010431

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Mar 31, 2012

1. We have audited the attached Balance Sheet of ANKA INDIA LIMITED, as at 31st March, 2012 and statement of 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 Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the 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 the 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 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of audit, 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 in paragraph 3 above, we report that:

a) subject to our comments in paragraphs 4(f)(i) to 4(f) (iii) below, 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, 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, the statement of Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 except for non-compliance of Accounting Standard 15 on "Employee''s Benefits" with respect to actuarial valuation of gratuity liability and hence disclosures required there under (refer Para No. 15(c) of Note No. 18 '''')

e) on the basis of written representations received from the directors of the Company as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2012 from being appointed as director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

f) in our opinion and to the best of our information and according to the explanations given to us and subject to:

i) Para No. 3 of Note No. ''18'' regarding non-confirmation / reconciliation of balances of debtors, creditors and other parties, the effect of which on accounts upon confirmation and reconciliation not ascertainable;

ii) Para No. 7 of Note No. ''18'' regarding pendency of assessment of impairment loss, the effect of which on accounts of the Company upon assessment not ascertained;

iii) Para No. 13 of Note No. ''18'' regarding the accounts of the Company prepared on going concern basis;

iv) Para No. 15(c) of Note No. ''18'' regarding non-provision of gratuity liability on the basis of actuarial valuation, effect of which on accounts has not been ascertained and read with other notes thereon, give the information required by the Companies Act,1956, 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 31st March, 2012;

ii) in the case of the statement of Profit & Loss Account, of the loss 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.

ANNEXURE TO THE AUDITORS REPORT

REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF ANKA INDIA LIMITED FOR THE PERIOD ENDED ON 31st MARCH, 2012

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

b) As explained to us, physical verification of fixed assets was conducted by the management at the end of the year which in our opinion is reasonable having regard to the size of the Company and nature of its business. No discrepancies were noticed on the aforesaid verification.

c) There was no disposal of fixed assets during the year.

2. a) As per the information and explanation given to us, the inventories have been physically verified by the management during the year. In our opinion, the frequency of physical 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) On the basis of our examination of the records of inventory and according to the information and explanations given to us, we are of the opinion that the Company has maintained proper records of inventory. As per information and explanation given to us no discrepancy was observed on physical verification.

3. (a) As per information and explanation given to us the company has not granted any loan to the companies, firms of other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) The company has taken interest free secured loan aggregating to Rs. 92,58,175/- in the earlier years from one party covered in the register maintained u/s 301 of the Companies Act, 1956. A balance of Rs. 90,78,175/- was outstanding as on 31st March 2012 out of that loan.

(c) In our opinion and according to the information and explanations given to us the terms and conditions of interest free secured loan taken are not prima facie prejudicial to the interest of the company;

(d) In our opinion and according to the information and explanations given to us the payment of principal amount was regular as stipulated.

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

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the contracts and arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

b) No transactions were made 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/- or more in respect of each party except for issue of Redeemable Preference Shares as stated in (18) below.

6. The Company has not accepted any deposit from public during the year within the meaning of sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules framed thereunder.

7. The Company has an internal audit system which commensurate with the size of the Company and the nature of its business.

8. We have been informed that the Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for the product of the Company.

9. a) According to the records of the Company and the information and explanations given to us, the Company has made delays on various occasions in depositing, with appropriate authorities, undisputed statutory dues including Investor Education & Protection Fund, Provident Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Custom Duty, Cess and other statutory dues. The undisputed statutory dues outstanding as at 31st March, 2012 for a period exceeding six months from the date they became payable are as follows:-

NOTE : Amount of custom duty of Rs.3,15,664/- which was outstanding prior to 01.04.03 has been written off and shown under the head extra ordinary items

10. The Company has accumulated losses exceeding fifty percent of the net worth of the Company. The Company has incurred cash losses during the year covered by our audit and in the immediately preceding financial year.

11. According to the information and explanation given to us, the Company has not defaulted in repayment of dues to financial institution and banks during the year. The company has not issued any debentures.

12. According to information and explanations given to us and based on the records produced to us, the Company has not granted loans and advances on the basis of securities by way of pledge of shares, securities, debentures and other investments.

13. In our opinion the Company is not a chit fund or Nidhi/mutual benefit fund/society.

14. In our opinion and according to the information and explanation given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanation given to us, the Company has not guaranteed any loan taken by others from banks and financial institutions.

16. No term loan has been taken during the year.

17. In our opinion and 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 were used for long term investment.

18. In our opinion and according to the information and explanations give to us, the price at which the Company has made the preferential allotment of redeemable preference shares to parties covered in the register maintained under section 301 of the Companies Act, 1956, during the year, was not prima facie prejudicial to the interest of the company.

19. The Company did not have any outstanding debentures during the year.

20. The Company has not raised any money by a public issue during the year.

21. Based upon the audit procedures performed and according to the information and explanations given to us, we report that no fraud on/or by the Company has been noticed or reported during the course of our audit for the year ended 31st March,2012. For. H.KUMAR & ASSOCIATES

CHARTERED ACCOUNTANTS

Firm Regn. No. 021518N

PLACE : NEW DELHI. ( H. Kumar )

DATED : M. NO. :010431

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Mar 31, 2011

1. We have audited the attached Balance Sheet of ANKA INDIA LIMITED, as at 31 st March, 2011 and also the Profit & Loss Account and the Cash Flow Statement for the period from 1st October, 2010 to 31st March, 2011. 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.

2. We conducted our audit in accordance with the 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 the 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 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of audit, 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 in paragraph 3 above, we report that:

a) subject to our comments in paragraphs 4(f)(i) to 4(f) (Hi) below, 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, 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, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956 except for non-compliance of Accounting Standard 15 on "Employee''s Benefits" with respect to actuarial valuation of gratuity liability and hence disclosures required there under (refer Note No. 15(c) of Schedule ''«'')

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

f) in our opinion and to the best of our information and according to the explanations given to us and subject to:

i) Note No. 3 of Schedule K''regarding non-confirmation /reconciliation of balances of debtors, creditors and other parties, the effect of which on accounts upon confirmation and reconciliation not ascertainable;

ii) Note No. 7 of Schedule ''K regarding pendency of assessment of impairment loss, the effect of which on accounts of the Company upon assessment not ascertained;

Hi) Note No. 15(c) of Schedule ''K'' regarding non-provision of gratuity liability on the basis of actuarial valuation, effect of which on accounts has not been ascertained;

iv) Note No. 13 of Schedule ''K'' regarding the accounts of the Company prepared on going Concern basis; and read with other notes thereon, give the information required by the Companies Act,1956, 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 31st March, 2011;

ii) in the case of the Profit & Loss Account, of the loss for the period ended on that date; and

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

ANNEXURE TO THE AUDITORS REPORT

REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF ANKA INDIA LIMITED FOR THE PERIOD ENDED ON 30TH SEPTEMBER, 2011

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

b) As explained to us, physical verification of fixed assets was conducted by the management at the end of the period which in our opinion is reasonable having regard to the size of the Company and nature of its business. No discrepancies were noticed on the aforesaid verification.

c) There was no disposal of fixed assets during the period.

2. a) As per the information and explanation given to us, the inventories have been physically verified by the management during the period. In our opinion, the frequency of physical 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) On the basis of our examination of the records of inventory and according to the information and explanations given to us, we are of the opinion that the Company has maintained proper records of inventory. As per information and explanation given to us no discrepancy was observed on physical verification.

3. (a) As per information and explanation given to us the company has not granted any loan to the companies, firms of other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) The company has taken interest free secured loan aggregating to Rs. 1,21,57,175/- in the earlier years from one party covered in the register maintained u/s 301 of the Companies Act, 1956. A balance of Rs. 92,58,175/- was outstanding as on 31st March 2011 out of that loan.

(c) In our opinion and according to the information and explanations given to us the terms and conditions of interest free secured loan taken are not prima facie prejudicial to the interest of the company;

(d) In our opinion and according to the information and explanations given to us the payment of principal amount was regular as stipulated.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and for sale of goods and services. During the course of our audit we have not observed any continuing failure to correct major weaknesses in internal control systems.

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the contracts and arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

b) No transactions were made 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/- or more in respect of each party except for issue of Redeemable Preference Shares as stated in (18) below.

6. The Company has not accepted any deposit from public during the period within the meaning of sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules framed thereunder.

7. The Company has an internal audit system which in our opinion needs to be further strengthened to make it commensurate with the size of the Company and the nature of its business

8. We have been informed that the Central Government has not prescribed maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 for the product of the Company.

9. a) According to the records of the Company and the information and explanations given to us, the Company has made delays on various occasions in depositing, with appropriate authorities, undisputed statutory dues including Investor Education & Protection Fund, Provident Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Custom Duty, Cess and other statutory dues. The undisputed statutory dues outstanding as at 31st March, 2011 for a period exceeding six months from the date they became payable are as follows:-

According to the information and explanations given to us, the details of dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess which have not been deposited on account of any dispute are given below:-

10. The Company has accumulated losses exceeding fifty percent of the net worth of the Company. The Company has incurred cash losses during the period covered by our audit and in the immediately preceding financial year.

11. According to the information and explanation given to us, the Company has not defaulted in repayment of dues to financial institution and banks during the period. The company has not issued any debentures.

12. According to information and explanations given to us and based on the records produced to us, the Company has not granted loans and advances on the basis of securities by way of pledge of shares, securities, debentures and other investments.

13. In our opinion the Company is not a chit fund or Nidhi/mutual benefit fund/society.

14. In our opinion and according to the information and explanation given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanation given to us, the Company has not guaranteed any loan taken by others from banks and financial institutions.

16. No term loan has been taken during the period.

17. In our opinion and 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 were used for long term investment.

18. In our opinion and according to the information and explanations give to us, the price at which the Company has made the preferential allotment of redeemable preference shares to parties covered in the register maintained under section 301 of the Companies Act, 1956, during the period, was not prima facie prejudicial to the interest of the company.

19. The Company did not have any outstanding debentures during the period.

20. The Company has not raised any money by a public issue during the period.

21. Based upon the audit procedures performed and according to the information and explanations given to us, we report that no fraud on/or by the Company has been noticed or reported during the course of our audit for the period ended 31st March, 2011.

For V.K.DHINGRA & CO.

CHARTERED ACCOUNTANTS

Firm Regn. No. 000250N

PLACE : NEW DELHI (V. K. DHINGRA)

DATED : 2nd July, 2011 PARTNER

M. NO.-.14467

---

Sep 30, 2010

1. We have audited the attached Balance Sheet of ANKA INDIA LIMITED, as at 30th September, 2010 and also the Profit & Loss Account and the Cash Flow Statement for the period from 1st July, 2009 to 30th September, 2010. 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.

2. We conducted our audit in accordance with the 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 the 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 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of audit, 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 in paragraph 3 above, we report that:

a) subject to our comments in paragraphs 4(f)(i) to 4(f) (iii) below, 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, 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, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 except for non-compliance of Accounting Standard 15 on "Employee''s Benefits" with respect to actuarial valuation of gratuity liability and hence disclosures required there under (refer Note No. 16 of Schedule ''L'')

e) on the basis of written representations received from the directors of the Company as on 30th September, 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th September, 2010 from being appointed as director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

f) in our opinion and to the best of our information and according to the explanations given to us and subject to:

i) Note No. 3 of Schedule ''L'' regarding non-confirmation / reconciliation of balances of debtors, creditors and other parties, the effect of which on accounts upon confirmation and reconciliation not ascertainable;

ii) Note No. 8 of Schedule ''L'' regarding pendency of assessment of impairment loss, the effect of which on accounts of the Company upon assessment not ascertained;

iii) Note No. 16(c) of Schedule ''L'' regarding non-provision of gratuity liability on the basis of actuarial valuation, effect of which on accounts has not been ascertained;

iv) Note No. 14 of Schedule ''L'' regarding the accounts of the Company prepared on going concern basis; and read with other notes thereon, give the information required by the Companies Act,1956, 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 30th September, 2010;

ii) in the case of the Profit & Loss Account, of the loss for the period ended on that date; and

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

REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF ANKA INDIA LIMITED FOR THE PERIOD ENDED ON 30TH SEPTEMBER, 2010

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

b) As explained to us, physical verification of major portion of fixed assets was conducted by the management at the end of the period which in our opinion is reasonable having regard to the size of the Company and nature of its business. No discrepancies were noticed on the aforesaid verification.

c) There was no disposal of fixed assets during the period.

2. a) As per the information and explanation given to us, the inventories have been physically verified by the management during the period. In our opinion, the frequency of physical 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) On the basis of our examination of the records of inventory and according to the information and explanations given to us, we are of the opinion that the Company has maintained proper records of inventory. As per information and explanation given to us no discrepancy was observed on physical verification.

3. (a) As per information and explanation given to us the company has not granted any loan to the companies, firms of other parties covered in the register maintained under section 301 of the Companies Act, 1956;

(b) The company has taken interest free secured and unsecured loans aggregating to Rs. 1,79,73,956/- in the earlier years from three parties covered in the register maintained u/s 301 of the Companies Act, 1956. Further interest free loan amounting to Rs. 42,54,700/- was taken from one of those parties during the period under audit. A balance of Rs. 1,21,57,175/- was outstanding as on 30th September 2010 out of these loans;

(c) In our opinion and according to the information and explanations given to us the terms and conditions of interest free secured and unsecured loans taken are not prima facie prejudicial to the interest of the company;

(d) In our opinion and according to the information and explanations given to us the payment of principal amount was regular as stipulated.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to sale of goods and services. During the course of our audit we have not observed any continuing failure to correct major weaknesses in internal control systems.

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the contracts and arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

b) No transactions were made 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/- or more in respect of each party except for issue of Redeemable Preference Shares as stated in (18) below.

6. The Company has not accepted any deposit from public during the period within the meaning of sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules framed thereunder. As explained to us, no order was passed by the Board or National Company Law Tribunal or Reserve Bank of India or any court or any tribunal in this regard.

7. The Company has an internal audit system which in our opinion needs to be further strengthened to make it commensurate with the size of the Company and the nature of its business.

8. We have been informed that the Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for the product of the Company.

9. a) According to the records of the Company and the information and explanations given to us, the Company has made delays on various occasions in depositing, with appropriate authorities, undisputed statutory dues including Investor Education & Protection Fund, Provident Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Custom Duty, Cess and other statutory dues. The undisputed statutory dues outstanding as at 30th September, 2010 for a period exceeding six months from the date they became payable are as follows:-



S. No. Nature of Dues Period of Default Amount (Rs.)

1. Custom Duty Prior to 01.04.03 3,15,664.27

2. Sales Tax / VAT 2005-2006 33,518.00

2006-2007 8,47,928.00

2008-2009 5,41,758.43

2009-2010 1,26,780.00

3. Income Tax (TDS) 2008-2009 25,135.00

2009-2010 22,259.79



b) According to the information and explanations given to us, the details of dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess which have not been deposited on account of any dispute are given below:-



Name of Nature Financial year to Amount Forum where dispute Statute of Dues which the matter (Rs.) is pending pertains

Central Penalty 1997 - 98 195497/- Additional Commissioner, Excise Act Central Excise

HVAT Sales Tax 2006 - 07 182760/- Jt. Excise & Taxation Commissioner (Appeals)



10. The Company has accumulated losses exceeding fifty percent of the net worth of the Company. The Company has incurred cash losses during the period covered by our audit and also during the immediately preceding financial year.

11. According to the information and explanation given to us, the Company has not defaulted in repayment of dues to financial institution and banks during the period. The company has not issued any debentures.

12. According to information and explanations given to us and based on the records produced to us, the Company has not granted loans and advances on the basis of securities by way of pledge of shares, securities, debentures and other investments.

13. In our opinion the Company is not a chit fund or Nidhi/mutual benefit fund/society.

14. In our opinion and according to the information and explanation given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanation given to us, the Company has not guaranteed any loan taken by others from banks and financial institutions.

16. In respect of term loans raised in the earlier years we have been informed that the same were applied for the purpose for which they were obtained. No term loan has been taken during the period.

17. In our opinion and 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 were used for long term investment.

18. In our opinion and according to the information and explanations give to us, the price at which the Company has made the preferential allotment of redeemable preference shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956, during the period, was not prima facie prejudicial to the interest of the company.

19. The Company did not have any outstanding debentures during the period.

20. The Company has not raised any money by a public issue during the period.

21. Based upon the audit procedures performed and according to the information and explanations given to us, we report that no fraud on/or by the Company has been noticed or reported during the course of our audit for the period ended 30th September, 2010.



For V. K. DHINGRA & CO. CHARTERED ACCOUNTANTS Firm Regn. No. 000250N



PLACE : NEW DELHI (V. K. DHINGRA) DATED : DECEMBER 02, 2010 PARTNER M. NO. : 14467

---

Jun 30, 2009

1. We have audited the attached Balance Sheet of ANKA INDIA LIMITED, as at 30th June 2009 and also the Profit & Loss Account and the Cash Flow Statement for the period from 1st April 2008 to 30th June 2009. 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.

2. We conducted our audit in accordance with the 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 the 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 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of audit, 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 in paragraph 3 above; we report that:

a) subject to our comments in paragraph 4(g)(i) and 4(g) (ii) below, we have obtained all the information and expla- nations, 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, 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, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

e) on the basis of written representations received from the directors of the Company as on 30th June, 2009 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th June, 2009 from being appointed as director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

f) Attention is invited to the Note No. 18 of Schedule ''L'' regarding disposal of machines used in the production of PU Sole which is subject to necessary approvals.

g) in our opinion and to the best of our information and according to the explanations given to us and subject to:

i) Note No. 3 of Schedule ''L'' regarding non-confirmation / reconciliation of balances of debtors, creditors and other parties, the effect of which on accounts upon confirmations and reconciliation not ascertainable;

ii) Note No. 8(b) of Schedule ''L'' regarding pendency of assessment of impairment loss, the effect of which on accounts of the Company upon assessment not ascertained;

iii) Note No. (14) of Schedule ''L'' regarding the accounts of the Company prepared on going concern basis; and read with other notes thereon, give the information required by the Companies Act,1956, 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 30th June, 2009

ii) in the case of the Profit & Loss Account, of the profit for the period ended on that date; and

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

ANNEXURE TO THE AUDITORS REPORT

REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF ANKA INDIA LIMITED FOR THE PERIOD ENDED ON 30th June, 2009

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

b) As explained to us, physical verification of major portion of fixed assets was conducted by the management at the end of the PERIOD which in our opinion is reasonable having regard to the size of the Company and nature of its business. On the basis of explanations given to us, no discrepancies were noticed on the aforesaid verification.

c) A substantial pan" of fixed assets has been disposed off during the period. According to the management, it has not affected the going concern. However, in our opinion, going concern is already affected in view of the negative networth of the company.

2. a) As per the information and explanation given to us, the inventories have been physically verified by the Manage- ment during the year. In our opinion, the frequency of physical 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) On the basis of our examination of the records of inventory and according to the information and explanations given to us, we are of the opinion that the Company has maintained proper records of inventory. As per information and explanation given to us no discripancy was obeserved on physical verification.

3. (a) As per information and explanation given to us the company has not granted any loan to the companies, firms of other parties covered in the register maintained under section 301 of the Companies Act, 1956;

(b) The company has taken an interest free unsecured loan aggregating to Rs. 87,79,748/- from three parties covered in the register maintained u/s 301 of the Companies Act, 1956 during the year. Maximum amount due to these parties at any time during the year was Rs. 2,21,12,826/-

(c) In our opinion and according to the information and explanations given to us the terms and conditions of interest free loans taken during the year were not prima facie prejudicial to the interest of the company; and

(d) In our opinion and according to the information and explanations given to us the payment of principal amount were regular as stipulated.

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

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the contracts and arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

b) No transactions were made 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/- or more in respect of each party.

6. The Company has not accepted any deposit from public during the year within the meaning of sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules framed thereunder. As explained to us, no order was passed by the Board or National Company Law Tribunal or Reserve Bank of India or any court or any tribunal in this regard.

7. The Company has an internal audit system which in our opinion needs to be further strengthened to make it commen- surate with the size of the Company and the nature of its business

8. We have been informed that the Central Government has not prescribed maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 for the product of the Company.

9. According to the records of the Company and the information and explanations given to us, the Company has made delays on various occasions in depositing, with appropriate authorities, undisputed statutory dues including Investor Education & Protection Fund, Provident Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Custom Duty, Cess and other statutory dues.

10. The Company has accumulated losses exceeding fifty percent of the net worth of the Company. The Company has not incurred cash losses during the period covered by our audit also immedately preceding financial year.

11. According to the information and explanation given to us, the Company has not defaulted in repayment of dues to financial institution and bank during the year. The company has not issued any debentures.

12. According to information and explanations given to us and based on the records produced to us, the Company has not granted loans and advances on the basis of securities by way of pledge of shares, securities, debentures and other investments.

13. In our opinion the Company is not a chit fund or Nidhi/mutual benefit fund/society.

14. In our opinion and according to the information and explanation given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. In our opinion and accordingly to the information and explanation given to us, the Company has not guaranteed any loan taken by others from banks and financial institutions.

16. In respect of term loans raised in the earlier years we have been informed that the same were applied for the purpose for which they were obtained. No term loan has taken during the period.

17. In our opinion and 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 were used for long term investment.

18. In our opinion and according to the information and explanations give to us, the price at which the Company has made the preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956, during the period was not prima facie prejudicial to the interest of the company.

19. The Company did not have any outstanding debentures during the period.

20. The Company has not raised any money by a public issue during the period.

21. Based upon the audit procedures performed and according to the information and explanations given to us, we report that no fraud on/or by the Company has been noticed or reported during the course of our audit for the period ended 30th June, 20oH

for V.K.DHINGRA & CO.

CHARTERED ACCOUNTANTS

PLACE : NEW DELHI. (V.K. DHINGRA)

DATED: DECEMBER 02, 2009. PARTNER

M.No. : 14467