Auditor Report of Aplab Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of Aplab Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, 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 Standalone Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and 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 of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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, of the state of affairs of the Company as at 31st March, 2015, and its Loss and its Cash flows for the year ended on that date.

Emphasis of Matters

a. The Company has incurred substantial cash loss during this year. The Company has accumulated losses and its net worth has been substantially eroded. During the year, Company could not repay some of the borrowings or honor LCs on its due dates. The overall debt burden has gone up during the year. These events indicate uncertainty that may cast doubt on the Company's ability to continue as a going concern considering operational inflows. Company has plans to sell some of its assets to reduce debt burden and improve its financial position.

b. The Inventory includes Rs. 1216 lacs which is non-moving over 3 years and may include some obsolescence. The Company claims that there is no obsolescence in electronics industry and therefore valued inventory at Cost.

c. The Receivables of Rs. 341 lacs which are overdue over one year need to be reconciled and confirmed. Some of these may have become doubtful or bad, however, the Company has not made adequate provision in the financial statements.

d. The Company has not tested & computed Impairment of Assets as per AS 28 considering substantial cash loss during the year.

Other Matters

a. The Company has unfunded Gratuity Policy of Rs. 1074 lacs on the Balance Sheet date.

b. The Company also has unpaid liability of Matured Public deposits of Rs. 23 lacs and Settlements of separated employees of Rs. 241 lacs.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, we give in the Annexure a statement on the matters specified in paragraphs of the Order and as required by section 143 (3) of the Act, we report that:

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

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

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

d. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2013;

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

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

i) The Company has not provided the impact of pending litigations in its financial statements. The total value of such litigations has been given in para vii(b) of the Annexure to this report ;

ii) The Company did not have any long-term contracts including derivative contracts in which there were any material foreseeable losses

iii) There has been a delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT

(Annexure referred to in paragraph under 'Report on Other Legal and Regulatory Requirements' section of our report of even date on the accounts of Aplab Limited for the year ended on 31st March 2015.)

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

(b) Physical verification of items of the fixed assets was

conducted by the management during the year as per the programme and we are informed that no material discrepancies were noticed in such verification. The verification results are being reconciled with Fixed Assets Register by the Company.

ii. (a) As explained to us, the inventory has been physically verified during the year by the management at the various locations. In our opinion, the frequency of such verification needs to be improved at regional offices.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventory followed by the management are reasonable and adequate at all manufacturing locations in relation to the size of the Company and the nature of its business. However, such procedures require improvement for Inventory at Regions and Branch offices.

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company is maintaining proper records of inventory at all manufacturing locations. However, there is need to improve & strengthen inventory recordkeeping at all regions and branches. As informed to us, the discrepancies noticed in physical verification of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

iii. According to the information and explanations given to us, the Company has not granted any loan to the parties listed in the Register maintained under Section 189 of the Companies Act, 2013. Consequently, the requirements of Clause (a) and (b) are not applicable.

iv. 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 nature of its business with regard to the purchase of inventory and fixed assets, and with regard to the sale of goods. However, improvement is required in internal control procedures in the areas of Inventory & Service Income at the regional offices. On the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weakness in other areas of internal control procedures except the above.

v. In our opinion and according to the information and explanations given to us, the Company has not fully complied with the directives issued by the Reserve Bank of India, the provisions of Section 73 to 76 of the Companies Act, 2013 and the rules framed there under with regard to the deposits accepted from the public. Company has not repaid on due dates matured Public deposits worth Rs. 23 lacs, which are outstanding on report date, as these were not claimed.

vi. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central government u/s 148 (1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however not made a detailed examination of the Cost records with a view to determine whether they are accurate or complete.

vii. (a) According to the records of the Company and information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income tax, Wealth tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Cess and other statutory dues with the appropriate authorities during the year, though there is a delay in few cases. There are no undisputed statutory dues outstanding as of March 31, 2015 for a period of more than six months since they became payable. The Company has not transferred amount of Rs. 1.59 lacs to Investor Education and Protection Fund as on balance sheet date.

(b) As at the year-end, according to the records of the Company and information and explanations given to us, the following are particulars of disputed dues on account of various Statutory Dues :-

Statute Amount F.Y. Forum where dispute is pending (Rs. in Lacs)

Excise Duty 10.76 1999-00 Appeal Pending With CESTAT

Excise Duty 5.35 2007-08 Appeal Pending With CESTAT

Excise Duty 1.50 2008-09 Appeal Pending With CESTAT

Excise Duty 1.81 2009-10 Appeal Pending With CESTAT

Excise Duty 6.60 2012-13 Appeal Pending with Commissioner of Central Excise (Appeals) CBD Belapur

Excise Duty 3.53 2013-14 Appeal Pending with Asst. Commissioner of Central Excise (Appeals)

Excise Duty 3.81 2014-15 Appeal Pending With CESTAT

Sales Tax 6.11 2002-03 Dy. Commissioner Appeals, New Delhi.

Sales Tax 2.10 2003-04 Dy. Commissioner Appeals, New Delhi.

Sales Tax 2.18 2004-05 Joint Commissioner Appeals, New Delhi.

Sales Tax 3.48 2004-05 Joint Commissioner Appeals, New Delhi.

Sales Tax 0.83 2005-06 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 1.70 2006-07 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 1.09 2007-08 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Income Tax 7.28 2004-05 Additional Commissioner Grade II, Appeal filed with Tribunal Mumbai

Income Tax 125.40 2009-10 Additional Commissioner Circle 1, Thane

Income Tax 682.31 2010-11 Commissioner of IT Range 1

Income Tax 124.02 2011-12 CIT II Thane

Total 989.86

viii. The Company has accumulated losses at the end of the year which is more than fifty percent of its net worth. The Company has incurred a Cash Loss during the current financial year; however, the company has not incurred a Cash Loss in the immediately preceding financial year.

ix. Based on our audit procedures and on the basis of information and explanations given by the management, there are cases of delay in Repayment of Principal amount of Term Loans and such overdue amount is Rs. 142 lacs as on 31st March, 2015 for two term loans for a period of one month.

x. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by its subsidiary from a bank.

xi. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the Company were, prima facie, applied by the Company for the purposes for which the loans were obtained. However, complete utilization of Term Loan availed could not be fully ascertained.

xii. Based on information and the explanations furnished by the management, which have been relied upon by us, there were no frauds on or by the company noticed or reported during the year, save for one instance of Rs. 8.20 lacs, a forged cheque withdrawal.

For Shahade & Associates Chartered Accountants (ICAI Firm Reg. No. 109840W)

Atul Shahade Place : Mumbai, Partner Date : 23rd May, 2015 M. No. 35227

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Mar 31, 2014

We have audited the accompanying financial statements of Aplab 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 ended on that date 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 (''the Act'') read with 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. 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 Statement of Profit and Loss, of the Profit for the year ended on that date; and in the case of the Cash Flow Statement, of the cash flow for the year ended on that date.

Emphasis of Matter

We draw attention to Note No. 12 (2) to the Financial Statements regarding Non provision of diminution of value of Investment made in joint venture company as per requirement of Accounting Standard 13. This is in terms of arrangement between the parties to acquire Aplab Ltd. shareholding in this Associate Company at original investment value. Our Opinion is not qualified in respect of this matter.

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 and proper returns adequate for the purposes of our audit have been received from branches not visited 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 and with the returns received from all the branches not visited by us;

d. In our opinion, the Balance Sheet, Statement of Profit Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 read with 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

ANNEXURE TO THE AUDITORS'' REPORT

( Annexure referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date on the accounts of Aplab Limited for the year ended on 31st March 2014. )

I. (a) The Company has maintained reasonable records showing particulars including quantitative details and situation of fixed assets. However, this needs completion in terms of identification, location & other details for few of the assets.

(b) Physical verification of items of the fixed asset was conducted by the management during the year as per the programme and we are informed that no material discrepancies were noticed in such verification. The verification results are being reconciled with Fixed Assets Register by the Company.

(c) During the year, the Company has not disposed off a substantial part of fixed assets

ii. (a) As explained to us, the inventory has been physically verified during the year by the management at the various locations. In our opinion, the frequency of such verification needs to be improved at branches.

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

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company is maintaining proper records of inventory at all manufacturing locations. As informed to us, the discrepancies noticed in physical verification of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

iii. (a) According to the information and explanations given to us, the Company has not granted any loan to the parties listed in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clause (iii) (a) to (iii) (d) are not applicable.

(b) According to the information and explanations given to us, the Company has additionally taken two Unsecured Loans amounting to Rs. 124.50 lacs ( Previous Year Rs. 1096 lacs ) and Fixed Deposits amounting to Rs. 42.12 lacs ( Previous Year Rs.177 Lacs ) from its Directors who are listed in the register maintained under section 301 of the Companies Act, 1956.

(c) The rate of interest and other terms and conditions of these loans taken are prima facie not prejudicial to the interest of the Company.

(d) In respect of Unsecured Loans taken repayment of principal and interest are not stipulated.

iv. 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 nature of its business with regard to the purchase of inventory and fixed assets, and with regard to the sale of goods. On the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weakness in other areas of internal control procedures.

v. In respect of transactions entered in the register maintained in pursuance of Sections 301 of the Companies Act, 1956,

(a) Based on audit procedures applied by us, 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 particulars of contracts / arrangements that needed to be entered into the register maintained under Section 301 have been so entered.

(b) According to the information and explanations given to us the transactions of purchase and sale of goods made in pursuance of such contracts / arrangements with some parties / companies listed in the register maintained undersection 301 are for specialized items for which alternative sources of supply are not readily available; as such, comparison of prices could not be made. However, as certified by the management, these transactions are at competitive prices considering the quality and non standard nature of products and terms of payment and other commercial considerations.

vi. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under with regard to the deposits accepted from the public.

vii. In our opinion, the Internal Audit covering Head Office & Manufacturing Units is commensurate with the size and the nature of its activities at these places.

viii. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central government u/s 209 (1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however not made a detailed examination of the Cost records with a view to (determine whether they are accurate or complete.

ix. (a) According to the records of the Company and information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income tax, Wealth tax, Service tax, Customs Duty, Excise Duty, cess and other statutory dues with the appropriate authorities during the year, though there is a delay in few cases. There are no undisputed statutory dues outstanding as of March 31, 2014 for a period of more than six months since they became payable.

(b) As at the year-end, according to the records of the (Company and information and explanations given to us, the following are particulars of disputed |dues on account of various Statutory Dues :-

Statute Amount F.Y. Forum where dispute is pending (Rs. in Lacs)

Excise Duty 1.80 2007-08 Commissioner of Central Excise (Appeals), Navi Mumbai

Excise Duty 5.37 1999-2000 CESTAT, Mumbai

Sales Tax 5.51 2002-03 Dy. Commissioner Appeals, New Delhi.

Sales Tax 1.33 2003-04 Dy. Commissioner Appeals, New Delhi.

Sales Tax 1.68 2004-05 Joint Commissioner Appeals, New Delhi.

Sales Tax 3.40 2004-05 Joint Commissioner Appeals, New Delhi.

Sales Tax 16.58 2003-04 Joint Commissioner of Sales Tax (Appeal VIII), Thane

Sales Tax 0.59 2004-05 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 0.83 2005-06 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 1.70 2006-07 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 1.08 2007-08 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Income Tax 22.28 2003-04 Additional Commissioner Grade II, Appeal filed with Tribunal Mumbai

Income Tax 14.28 2004-05 Additional Commissioner Grade II, Appeal filed with CIT (A) 11 Thane

Income Tax 11.44 2005-06 Additional Commissioner Grade II, Appeal filed with A.C. Circle 1, Thane

Income Tax 7.62 2007-08 Appeal filed with ITAT Mumbai

Income Tax 515.75 2008-09 Additional Commissioner Circle 1, Thane

Income Tax 682.31 2009-10 Appeal filed with Commissioner of IT Range 1

Total 1293.55

x. The Company has accumulated losses at the end of the year which is less than fifty percent of its net worth. The Company has not incurred a Cash Loss during the current financial year, however the company has incurred Cash Loss amounting to Rs. 153.56 Lacs in the immediately preceding financial year.

xi. Based on our audit procedures and on the basis of information and explanations given by the management, there are cases of delay in Repayment of Principal amount of Term Loans with interest thereon and such overdue amount is Rs. 38.67 lacs as on 31s* March, 2014 for two term loans for a period of one month. This has been subsequently paid.

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

xiii. The provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Societies are not applicable to the Company.

xiv. In our opinion and according to information and explanations given to us the Company is not a dealer or trader of shares, debentures and other investments.

xv. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by its subsidiary from a bank.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the Company were, prima facie, applied by the Company for the purposes for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, funds raised on short term basis have, prima facie, not been used for long term investment and vice versa.

xviii. The Company has not made any preferential allotment to parties and companies covered under register maintained under Section 301 of the Companies Act, 1956, during the year.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised money by any public issues during the year.

xxi. Based on information and the explanations furnished by the management, which have been relied upon by us, there were no frauds on or by the company noticed or reported during the year.

For Shahade & Associates Chartered Accountants (ICAI Firm Regn. No. 109840W)

Atul Shahade Partner M. No. 35227

Place : Mumbai Date : May 8, 2014

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Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Aplab Limited ("the Company") after merger of its wholly owned subsidiary Intel Instruments & Systems 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 ended on that date 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 ofthe Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation ofthe 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 ofthe 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 ofthe 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 aforesaid 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 ofthe Balance Sheet, ofthe state of affairs ofthe Company as at March 31,2013;

(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 ofthe 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 and proper returns adequate for the purposes of our audit have been received from branches not visited 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 and with the returns received from branches not visited by us;

d. In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section211 ofthe 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 ofthe Companies Act, 1956

ANNEXURE TO THE AUDITORS'' REPORT

(Annexure referred to in Paragraph 1 of our report of even date on the accounts for the year ended 31st March 2013 of Aplab Limited)

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

(b) Physical verification of some items of fixed assets was conducted by the management during the year and we are informed that no material discrepancies were noticed in such verification.

(c) In our opinion, the Company has not disposed of a substantial part of fixed assets during the year,

ii. (a) As explained to us, the inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

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

iii. (a) According to the information and explanations given to us, the Company has not granted any loan from parties listed in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clause (iii) (a) to (iii) (d) are not applicable.

(b) According to the information and explanations given to us, the Company has taken Unsecured Loans amounting to Rs. 1096 lacs ( Previous Year Rs.961 lacs) and Fixed Deposits amounting to Rs. 177 Lacs ( Previous Year Rs. 121 lacs ) from its Directors who are listed in the register maintained under section 301 of the Companies Act, 1956.

(c) The rate of interest and other terms and conditions of these loans taken are prima facie not prejudicial to the interest of the Company.

(d) In respect of Unsecured Loans taken repayment of principal and interest are not stipulated.

iv. 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 nature of its business with regard to the purchase of inventory and fixed assets, and with regard to the sale of goods. On the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control procedures.

v. In respect of transactions entered in the register maintained in pursuance of Sections 301 of the Companies Act, 1956,

(a) Based on audit procedures applied by us, 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 particulars of contracts / arrangements that needed to be entered into the register maintained under Section 301 have been so entered.

(b) According to the information and explanations given to us the transactions of purchase and sale of goods made in pursuance of such contracts / arrangements with some parties / companies listed in the register maintained under section 301 are for specialized items for which alternative sources of supply are not readily available; as such, comparison of prices could not be made. However, as certified by the management, these transactions are at competitive prices considering the quality and non standard nature of products and terms of payment and other commercial considerations.

vi. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed thereunder with regard to the deposits accepted from the public.

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

viii.We have broadly reviewed the costs records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central government u/s 209 (1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however not made a detailed examination of the Cost records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company and information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income tax, Wealth tax, Service tax, Customs Duty, Excise Duty, cess and other statutory dues with the appropriate authorities during the year, though there is a delay in few cases. There are no undisputed statutory dues outstanding as of March 31, 2013 for a period of more than six months since they became payable.

(b) As at the year-end, according to the records of the Company and information and explanations given to us, the following are particulars of disputed dues on account of various Statutory Dues :-

Statute Amount F.Y. Forum where dispute is pending (Rs. in Lacs)

Custom Duty 5.30 2003-04 CESTAT, Mumbai

Excise Duty 1.80 2007-08 Commissionerof Central Excise (Appeals), Navi Mumbai

Excise Duty 5.37 1999-2000 CESTAT, Mumbai

Sales Tax 5.51 2002-03 Dy. Commissioner Appeals, New Delhi.

Sales Tax 1.33 2003-04 Dy. Commissioner Appeals, New Delhi.

Sales Tax 1.68 2004-05 Joint Commissioner Appeals, New Delhi.

Sales Tax 3.40 2004-05 Joint Commissioner Appeals, New Delhi.

Sales Tax 16.58 2003-04 Joint Commissioner of Sales Tax (Appeal VIII), Thane,

Sales Tax 0.59 2004-05 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 0.83 2005-06 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 1.70 2006-07 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Sales Tax 1.08 2007-08 Additional Commissioner Grade II, Appeal III, Commercial Taxes (Lucknow)

Income Tax 22.28 2004-05 Additional Commissioner Grade II, Appeal filed with Tribunal Mumbai

IncomeTax 14.58 2005-06 Additional Commissioner Grade II, Appeal filed with CIT (A) II Thane

Income Tax 11.44 2006-07 Additional Commissioner Grade II, Appeal filed with A.C. Circle 1, Thane

Income Tax 7.64 2008-09 Appeal filed with ITAT Mumbai

Income Tax 515.75 2009-10 Additional Commissioner Circle 1, Thane

Income Tax 682.31 2010-11 Appeal filed with Commissioner of IT

Range 1

Total 1299.17

x. The Company has accumulated losses at the end of the year which are less than fifty percent of its net worth. The Company has incurred Cash Loss during the current financial year amounting to Rs. 153.56 Lacs, however, Company has not incurred any Cash Loss in the immediately preceding financial year.

xi. Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to banks.

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

xiii. The provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Societies are not applicable to the Company.

xiv. In our opinion and according to information and explanations given to us the Company is not a dealer or trader of shares, debentures and other investments.

xv. According to the information and explanations given to us & subject to our observation in para 2 of our main report, the Company has given a guarantee for loans taken by its subsidiary from a bank on terms and conditions, which in our opinion, are prima facie, not prejudicial to the interest of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the Company were, prima facie, applied by the Company for the purposes for which the loans were obtained. Complete utilization of additional Term Loan availed could not be ascertained due to pending full capitalization.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, funds raised on short term basis have, prima facie, not been used for long term investment and vice versa.

xviii. The Company has not made any preferential allotment to parties and companies covered under register maintained under Section 301 of the Companies Act, 1956, during the year.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised money by any public issues during the year.

xxi. Based on information and the explanations furnished by the management, which have been relied upon by us, there were no frauds on or by the company noticed or reported during the year.

For Shahade & Associates

Chartered Accountants

(ICAI Firm Regn. No. 109840W )

Atul Shahade

Place : Mumbai Partner

Date : May 30, 2013 M. No. 35227

---

Mar 31, 2012

We have audited the attached Balance Sheet of Aplab Limited as on March 31, 2012, the Profit and Loss Account and the Cash Flow Statement for the year ended on that date all of which we have signed under reference to this report. These financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

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

We report as follows:- 1. As required by the Companies (Auditor's Report) Order, 2003 and as amended by Companies (Auditor's Report) (Amednment) Order, 2004 (together the "Order") issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. We invite reference to the accumulated losses of the

wholly owned subsidiary, Intel Instruments & Systems Ltd. (Intel), impacting the realisability of the Company's Investment Rs. 225 lacs (P.Y. Rs.225 lacs), Debtors Rs. 338.56 lacs (P.Y. Rs. 326.39 lacs) and Loans & Advances Rs. 422.62 lacs (P.Y. Rs. 219.72 lacs). This is also a matter referred to in our audit report for the previous year 2010-11.

3. 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.

4. In our opinion, proper books of accounts as required by

law have been kept by the Company, so far as appears from our examination of these books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.

5. The Balance Sheet and Profit and Loss Account and the

Cash Flow Statements dealt with by this report are in agreement with the books of accounts.

6. In our opinion and to the best of our knowledge and

according to the explanations given to us, the Balance Sheet, Profit & Loss Account and the Cash Flow Statement comply with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 to the extent applicable subject to non-compliance with AS-15 which requires accounting for accrued liability towards employment benefits including gratuity. As per the

Company's accounting policy in this regard, gratuity is recognized when contribution is made to the Group

Gratuity Scheme. The year-end amount payable to LIC under this scheme not recognized in the financial statements is Rs 860.44 lacs.

7. On the basis of the written representations received from the Directors as on March 31, 2012 which have been 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.

8. We further report that, without considering our observations at Para 2 above, the effect of which could not be determined, had the observations made by us in Para 6 above been considered while compiling accounts for the year, the profit after tax of Rs.71.62 lacs for the year would have resulted into a loss of Rs 788.82 lacs and balance of Reserves and Surplus would have been Rs1,302.02 lacs as against the reported figure of Rs 2,162.46 lacs. Considering this, in our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet and Profit and Loss Account read with the notes thereon give the information required by the Companies Act, 1956 in the manner so required; and do not give a true and fair view:

in the case of the Balance Sheet, of the state of affairs of the Company as at 31 st March 2012 in the case of the Profit and Loss Account, of the profit for the year ended on that date in the case of Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT

(Annexure referred to in Paragraph 1 of our report of even date on the accounts for the year ended 31st March 2012 of Aplab Limited)

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

(b) Physical verification of some items of fixed assets was conducted by the management during the year and we are informed that no material discrepancies were noticed on such verification.

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

ii. (a) As explained to us, the inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

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

iii. (a) According to the information and explanations given to us, the Company has not granted any loan to parties listed in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clause (iii) (a) to (iii) (d) are not applicable.

(b) According to the information and explanations given to us, the Company has taken unsecured loans amounting to Rs.961 lacs from its Directors who are listed in the register maintained under section 301 of the Companies Act, 1956.

(c) The rate of interest and other terms and conditions of these loans taken are prima facie not prejudicial to the interest of the Company.

(d) In respect of loans taken repayment of principal and payment of interest are not stipulated.

iv. 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 nature of its business with regard to the purchase of inventory and fixed assets, and with regard to the sale of goods. On the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control procedures.

v. In respect of transactions entered in the register

maintained in pursuance of Section 301 of the Companies Act, 1956,

(a) Based on audit procedures applied by us, 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 particulars of contracts / arrangements that needed to be entered into the register maintained under Section 301 have been so entered.

(b) According to the information and explanations given to us the transactions of purchase and sale of goods made in pursuance of such contracts / arrangements with some parties / companies listed in the register maintained under section 301 are for specialized items for which alternative sources of supply are not

readily available; as such comparison of prices could not be made. However, as certified by the management, these transactions are at competitive prices considering the quality and non standard nature of products and terms of payment and other commercial considerations.

vi. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed thereunder with regard to the deposits accepted from the public.

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

viii. We have broadly reviewed the books of account maintained by the Company relating to the manufacture of electronic products and components thereof. We have not made an examination of the cost records required to be maintained under companies (Cost Accounting Records) rules 2011 in respect of their accuracy and completeness as the company is in the process of obtaining the compliance report of the cost accountant.

ix. (a) According to the records of the Company and information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income tax, Wealth tax, Service tax, Customs Duty, Excise Duty, cess and other statutory dues with the appropriate authorities during the year, though there is a slight delay in few cases. There are no undisputed statutory dues outstanding as of March 31, 2012 for a period of more than six months since they became payable, except as under:

Name of Nature of Amount Period Due Date Statute dues (Rs. in to which Lacs) amount relate

VAT Tax 0.12 2011-12 15/10/2011

VAT Tax 0.02 2011-12 15/12/2011

VAT Tax 0.15 2011-12 15/02/2012

TOTAL 0.29

x. Subject to our observation in para 8 of the main report,

the Company does not have accumulated losses as at the end of the year. The Company has not incurred cash losses during the current financial year but has incurred cash losses in the immediately preceding financial year.

xi. Based on our audit procedures and on the basis of

information and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to banks

xii. According to the information and explanations given to

us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. The provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/Societies are not applicable to the Company.

xiv. In our opinion and according to information and

explanations given to us the Company is not a dealer or trader of shares, debentures and other investments.

xv. According to the information and explanations given to

us & subject to our observation in para 2 of our main report, the Company has given a guarantee for loans taken by its subsidiary from a bank on terms and conditions, which in our opinion, are prima facie, not prejudicial to the interest of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the Company were, prima facie, applied by the Company for the purposes for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, funds raised on short term basis have, prima facie, not been used for long term investment and vice versa.

xviii. The Company has not made any preferential allotment to parties and companies covered under register maintained under Section 301 of the Companies Act, 1956, during the year.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised money by any public issues during the year.

xxi. Based on information and the explanations furnished by the management, which have been relied upon by us, there were no frauds on or by the company noticed or reported during the year.

For M P Chitale & Co. Chartered Accountants

ICAI FRN:101851W

Ashutosh Pednekar Thane, Partner

August 14, 2012 ICAI M. No. 41037

---

Mar 31, 2010

We have audited the attached Balance Sheet of Aplab Limited as on March 31, 2010, the relative Profit and Loss Account and the Cash Flow Statement for the year ended on that date all of which we have signed under reference to this report. These financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

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

We report as follows:-

1. As required by the Companies (Auditors Report) Order, 2003 and as amended by Companies (Auditors Report) (Amednment) Order, 2004 (together the "Order") issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. We invite reference to the annual report of the wholly owned subsidiary, Intel Instruments & Systems Ltd. (Intel) which is appended to the Companys annual report. It may be noted that Intel has accumulated losses impacting the realisability of the Companys Investment Rs.225 lacs (P. Y. Rs.225 lacs), Debtors Rs.225.18 lacs (P.Y. Rs. 283.61 lacs) and Loans & Advances Rs. 21.58 lacs (P.Y. Rs. 55.05 lacs). This is also a matter referred to in our audit report for the previous year 2008-09.

3. 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.

4. In our opinion, proper books of accounts as required by law have been kept by the Company, so far as appears from our examination of these books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.

5. The Balance Sheet and Profit and Loss Account and the Cash Flow Statements dealt with by this report are in agreement with the books of accounts.

6. In our opinion and to the best of our knowledge and according to the explanations given to us, the Balance Sheet, Profit & Loss Account and the Cash Flow Statement comply with the accounting standards referred to in Section 211 (3C)ofthe Companies Act,1956 to the extent applicable subject to non-compliance with AS- 15 which requires accounting for accrued liability towards retirement benefits including gratuity. As per the Companys accounting policy in this regard, gratuity is provided when contribution is made to the Group Gratuity Scheme. The year-end amount payable to LIC under this scheme not recognized in the financial statements is Rs 354.37 lacs.

7. On the basis of the written representations received from the Directors as on March 31, 2010 which have been 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.

8. We further report that, without considering our observations at Para 2 above, the effect of which could not be determined, had the observations made by us in Para 6 above been considered while compiling accounts for the year, the loss of Rs. 615.97 lacs for the year would have increased to loss of Rs 970.34lacs and balance of Reserves and Surplus would have been Rs1614.33lacs as against the reported figure of Rs 1968.7 Olacs.

9. In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet and Profit and Loss Account read with the notes thereon give the information required by the Companies Act, 1956 in the manner so required; however, in view of our observations in Paragraph 8 above, they do not give a true and fair view:

* in the case of the Balance Sheet, of the state of affairs of the Company as at 31s1 March 2010,

* in the case of the Profit and Loss Account, of the loss for the year ended on that date

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

ANNEXURE TO THE AUDITORS REPORT

(Annexure referred to in Paragraph 1 of our report of even date on the accounts for the year ended 31st March 2010 of Aplab Limited)

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

(b) Physical verification of some items of fixed assets was conducted by the management during the year and we are informed that no material discrepancies were noticed on such verification.

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

ii. (a) As explained to us, the inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

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

iii. (a) According to the information and explanations given to us, the Company has not taken loans from the parties listed in the register maintained under section 301 of the Companies Act, 1956; however, the Company has granted loan amounting to Rs. 21.58 lacs to its subsidiary, Intel Instruments & Systems Ltd. (P.Y. Rs. 21.58 lacs). The maximum balance outstanding during the year was Rs.21.58 lacs

(b) This interest free loan granted is prima facie not prejudicial to the interest of the Company.

(c) The Company has not stipulated any terms and conditions of repayment of this interest free loan given to its subsidiary.

(d) Subject to our observations in para (iii) (a) above there is no overdue amount of loan granted to the company listed in the register maintained under Section 301 of the Companies Act, 1956.

iv. 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 nature of its business with regard to the purchase of inventory and fixed assets, and with regard to the sale of goods. The internal control procedures in case of services rendered need to be strengthened. Subject to this observation, on the basis of our examination and according to the information and

explanations given to us, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control procedures.

v. In respect of transactions entered in the register maintained in pursuance of Sections 301 of the Companies Act, 1956,

(a) Based on audit procedures applied by us, 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 transactions that needed to be entered into the register maintained under Section 301 have been so entered.

(b) According to the information and explanations given to us there are transactions of purchase and sale of goods in excess of Rs.5 lakhs with some parties / companies listed in the register maintained under section 301. We are informed that these goods are specialized items for which alternative sources of supply are not readily available; as such comparison of prices could not be made. However, as certified by the management, these transactions are at competitive prices considering the quality and non standard nature of products and terms of payment and other commercial considerations.

vi. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed thereunder with regard to the deposits accepted from the public.

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

viii. We have broadly reviewed the books of account maintained by the Company relating to the manufacture of electronic products and components thereof pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

ix. (a) According to the records of the Company and information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Sales-Tax, Wealth-Tax, Customs Duty, Excise Duty, cess and other statutory dues with the appropriate authorities during the year. There are no undisputed statutory dues outstanding as of March 31, 2010 for a period of more than six months since they

became payable except the unclaimed debentures amounting to Rs. 7.80 lacs (Previous year Rs. 7.77 lacs) which should have been paid to the Investor Education & Protection Fund. However, this amount has been deposited by the company with Maharashtra Executor and Trustee Company Limited, the trustees of the debenture holders.

(b) As at the year-end according to the records of the Company and information and explanations given to us, the following are particulars of disputed dues on account of following matters:-

Statute Amount Financial Forum where (Rs.in Year dispute is pending Lacs) Appellate Authority

Custom Duty 5.30 2003-04 CESTAT, Mumbai

Excise Duty 1.80 2007-08 Commissionar of Central Excise (Appeals), Navi Mumbai

Excise Duty 5.37 1999-2000 CESTAT, Mumbai

x Subject to our observation in para 8 of the main report, the Companys accumulated losses as at the end of the year are less than fifty percent of its net worth. The Company has incurred cash losses during the current financial year.

xi. Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to banks

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

xiii. The provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/Societies are not applicable to the Company.

xiv. In our opinion and according to information and explanations given to us the Company is not a dealer or trader of shares, debentures and other securities.

xv. According to the information and explanations given to us, the Company has given a guarantee for loans taken by its subsidiary from a bank on terms and conditions, which in our opinion, are prima facie, not prejudicial to the interest of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the Company were, prima facie, applied by the Company for the purposes for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, funds raised on short term basis have, prima facie, not been used for long term investment and vice versa.

xviii. The Company has not made any preferential allotment to parties and companies covered under register maintained under Section 301 of the Companies Act, 1956, during the year.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised money by any public issues during the year.

xxi. Based on information and the explanations furnished by the management, which have been relied upon by us, there were no frauds on or by the company noticed or reported during the year.



For M.P. Chitale & Co

Chartered Accountants

ICAI Firm Regn. No. 101851W

Ashutosh Pednekar Mumbai, Partner August 11, 2010 ICAI M.No.41037