Auditor Report of Artefact Projects Ltd.

Mar 31, 2017

To

The Members

ARTEFACT PROJECTS LIMITED Report on the Financial Statements

We have audited the accompanying financial statements of ARTEFACT PROJECTS LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the 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 financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India including the Accounting Standards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules, 2015.

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.

Auditors'' 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 and the Order under section 143(11)of the Act.

We conducted our audit of the financial statements 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 financial 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. 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 qualified audit opinion on the financial statements.

Basis for Qualified Opinion

Attention is drawn to:

i) Note no. 9.01 to the financial statements regarding the nonpayment / reconciliation of Service Tax and non filing of Service Tax Returns since April 2015, the impact of which on the financial statements cannot be quantified and will be accounted for as and when determined.

ii) Note no. 15.01 to the financial statements wherein the management of the company has considered Trade Receivables outstanding for more than 6 months amounting to Rs, 99,246,872 as good and fully recoverable. In absence of balance confirmations/reconciliations from the customers from whom these amounts are due or other alternate audit evidence to corroborate management''s assessment of recoverability of these balances and having regard to the age of these balances, we are unable to comment the extent to which these balances are recoverable.

iii) Note no. 17.04 to the financial statements wherein the Management of the Company has considered the receivable amounting to Rs, 7,272,300given as sponsorship for higher education in the earlier years as good and fully recoverable even though he has failed to fulfill his stipulated commitments and obligations. In the absence of balance confirmation from the said individual or other alternate audit evidence to corroborate management''s assessment of recoverability of this balance and having regard to the age of this balance, we are unable to comment the extent to which this balance is recoverable.

iv) Note no. 19.01 to the financial statements wherein the liabilities in respect of Salary and Retainer ship Fees payable amounting to Rs, 2,689,983 has been written back by the Company. In the absence of the documents for full & final settlement with these employees and retainers or other alternative audit evidence, we are unable to comment the extent to which the Company''s liability to these employees and retainers ceased to exist.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matters described in the basis for qualified opinion paragraph above, 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 March 31,2017 and its profit and its cash flows for the year ended on that date.

Other Matters

The Financial Statements and other financial information includes the Company''s proportionate share in jointly controlled total assets of Rs, 51,951,718 as at March 31, 2017, total revenue of Rs, 14,022,228 and total expenditure of Rs, 13,839,193 for the year ended on that date and the elements making up the cash flow statements and related disclosures in respect of unincorporated Joint Ventures which is based on audited financial statements of the respective Joint Ventures audited by one of the Joint Auditor’s and furnished to us.

Our Opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3)of the Act, were port that:

a. We have sought and obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit except for the matters described in the ''Basis for Qualified Opinion'' paragraph above.

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

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

d. Except for the matters described in the ''Basis for Qualified Opinion'' paragraph above, in our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, as applicable read with Rule 7 of the Companies (Accounts) Rules, 2015.;

e. The matter described in the ''Basis for Qualified Opinion'' paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

f. On the basis of the written representations received from the Directors as on March 31,2017 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.

g. With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate Report in “Annexure”.

h. 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, 2016, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements as referred to in Note no. 28(ii) to the financial statements.

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

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

iv. The Company has provided the requisite disclosures in the financial statements as regards to its holdings and dealings in Specified Bank Notes as defined in the Notification S.O 3407(E) dated November 8, 2016 of the Ministry of Finance, during the period from November 8, 2016 to December 30, 2016 and based on audit procedure performed and the representation provided by the Management we report that the disclosures are in accordance with the books of account maintained by the Company and as produced to us by the management.

2 As required by the Companies (Auditor''s Report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the Internal Financial Controls over financial reporting of ARTEFACT PROJECTS LIMITED (“the Company”) as of March 31, 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by the ICAI and deemed to be prescribed under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Qualified opinion

According to the information and explanations given to us and based on our audit, the following material weaknesses have been identified in the operating effectiveness of the company''s internal financial control over financial reporting as on March 31,2017 in respect of:

a) Trade receivables & Service Tax, reconciliations of balances outstanding, specifically trade receivables for more than six months, CENVAT receivable/balances with Service Tax Authorities are not available, that has effect on disclosure of Financial Statements, which indicates that management is not taking effective steps for the same and consequently it affects the collection from customers and may result into under provision of doubtful debts and amount of CENVAT not receivable continue to be disclosed as an asset and not charged to statement of profit & loss.

b) Accounting software used for maintenance of books of accounts enables to delete any transaction without appropriate authorization. Further there is lack of audit trail available in Tally Software to provide us with the audit evidence to completely rely on system.

A ''material weakness'' is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company''s annual or interim financial statements will not be prevented or detected on a timely basis.

In our opinion, except for the effects/possible effects of the material weaknesses described above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as of March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI except for the material weakness described above and the effects/possible effects thereof.

We have considered the material weaknesses identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the March 31,2017 financial statements of the Company, and the material weaknesses described above does not affect our qualified opinion on the financial statements of the Company.

i. In respect of its fixed assets:

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

b. According to the information and explanations given to us, the Company has physically verified all the fixed assets and no material discrepancies were noticed on such physical verification as compared with the available records.

c. According to the information and explanations given to us, the original title deeds of immovable properties have been pledged as security for loans with a lender, we have been produced the photocopy of the title deeds of these immovable properties and based on such documents, the title deeds are held in the name of the Company except in case of the Land on which the building has been constructed is jointly owned by the Company, some directors and his relatives (Refer Note No. 11.01 to the Financial Statements).

ii. In respect of its inventories:

The Company does not have any Inventories of Raw Material, Finished Goods and Stores & Spares. The inventory at the year and represents the Project Management Consultancy Services which remained inbuilt as on the reporting date and accordingly the provisions of Clause (ii) of Paragraph 3 of the Order as far as it relates to Physical Verification of Inventories are not applicable to the Company.

iii. In respect of loans, secured or unsecured, granted by the Company to Companies, Firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Act:

a. The Company has given advances in the nature of loan to one of the company and as per information and explanations given to us the above loan is repayable on demand. Receipt of interest is regular.

b. As the loan is repayable on demand, the question of overdue amount does not arise.

iv. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Act, as applicable, in respect of loans granted, investments made and guarantees and securities provided.

v. According to the information and explanations given to us, the Company has not accepted any deposit from the public. Therefore, the provisions of Clause (v) of paragraph 3 of the Order are not applicable to the Company.

vi. According to the information and explanations given to us, the Central Government has not prescribed maintenance of the cost records under sub section (1) of section 148 of the act in respect of business activities carried on by the company. Therefore, the provisions of Clause (vi) of paragraph 3 of the Order are not applicable to the Company.

vii. According to the information and explanations given to us, in respect of statutory dues:

a. The Company has generally been regular in depositing undisputed statutory dues in respect of Provident Fund and Employees'' State Insurance, with the appropriate authorities during the year. Substantial delays have been noticed in depositing undisputed statutory dues in respect of Service Tax and Income Tax with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of such statutory dues were outstanding as at March 31,2017 for a period of more than six months from the date they became payable except in respect of TDS & Service Tax aggregating to Rs, 39,331,354 as detailed below.

Name of the Statute	Nature of the Dues	Period to which it relates	Amount (in Rs,)
The Income Tax Act 1961	Tax Deducted at Source (TDS)	April 16 to August 16	3,007,305
The Finance Act 1994	Service Tax	April 15 to August 16	36,324,049
	Total		39,331,354

b. There are no disputed statutory dues of Income tax, Sales tax, Wealth tax, Service tax, Duty of Customs, Duty of Excise, Value added tax and Cess, which have not been deposited on account of disputed matters pending before appropriate authorities.

viii. Based on our audit procedures and according to the information and explanations given by the management, we are of the opinion that as on March 31,2017 the Company has not defaulted in repayment of dues to Financial institutions and banks.

ix. According to the information and explanations given to us, the Company did not raise any term loans during the year. Accordingly, provisions of paragraph 3 (ix) of the CARO 2016 is not applicable to the Company.

x. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and on the basis of information and explanations given by the management, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year.

xi. According to the information and explanations given to us, the managerial remuneration has been paid or provided in accordance with the provisions of section 197 read with Schedule V to the Act.

xii. In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of Clause (xii) of paragraph 3 of the Order are not applicable to the Company.

xiii. According to the information and explanations given to us, the transactions entered with the related parties are in compliance with section 177 and 188 of the Act where applicable and the details of related party transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv. According to the information and explanations give to us and based on our examination of the records of the Company, during the year, the company has not raised any money by preferential allotment or private placement of share or debentures. Therefore, the provisions of Clause (xiv) of paragraph 3 of the Order are not applicable to the Company.

xv. According to the information and explanations given to us, during the year the company has not entered into any non-cash transactions with directors or persons connected with him. Therefore, the provisions of Clause (xv) of paragraph 3 of the Order are not applicable to the Company.

xvi. In our opinion and according to information and explanations provided to us, the Company is not required to be registered under section 45-IAof the Reserve Bank of India Act, 1934.

For CHATURVEDI & SHAH For NARESH PATADIA & CO.

Chartered Accountants Chartered Accountants

(Firm Registration No. 101720W) (Registration No. 106936W)

R KORIA NARESH PATADIA

Partner Proprietor

Membership No. 35629 Membership No. 35620

Place: Mumbai Place: Nagpur

Date: May 23, 2017 Date: May 23, 2017

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Mar 31, 2015

We have audited the accompanying standalone financial statements of ARTEFACT PROJECTS LIMITED ("the Company"), which comprise the Balance sheet as at 31st March, 2015, 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 (Indian GAAPs), including Accounting Standards 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

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

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

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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation of the standalone 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 management, as well as evaluating the overall presentation of the standalone financial statements.

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

Basis for Qualified Opinion

We refer to Note.16 to the standalone financial statements wherein the Management of the Company has considered Trade Receivables outstanding for more than 6 months amounting to Rs.99,270,767 as good and fully recoverable. In the absence of balance confirmations / reconciliations from the customers from whom these amounts are due or other alternate audit evidence to corroborate management's assessment of recoverability of these balances and having regard to the age of these balances, we are unable to comment the extent to which these balances are recoverable.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matter described in the basis for qualified opinion paragraph above, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015 and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to the Note No. 9.01 to the standalone financial statements, according to which the Company doesn't have information in respect of creditors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence it has not separately disclosed the amount payable to Micro, Small and Medium Enterprises.

Our opinion is not modified in respect of this matter.

Other Matters

The standalone financial statements and other financial information include the Company's proportionate share in jointly controlled total assets of Rs. 135,289,512 , total revenue of Rs. 2,342,826 , total expenditure of Rs. 1,462,788 and the elements making up the Cash Flow Statement and related disclosures in respect of an Unincorporated Joint Ventures which is based on audited financial statements of the respective Joint Ventures audited by one of the Joint Auditor's and furnish to us.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

2. As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit except for the matter described in the Basis for Qualified Opinion paragraph.

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

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

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

(e) The matter described in the Basis for Qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the company.

(f) On the basis of the written representations received from the directors as on 31st March, 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.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements as referred to in Note No. 16.02 and 28 to the standalone financial statements.

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

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

ANNEXURE TO AUDITOR'S REPORT

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Artefact Projects Limited on the accounts for the year ended 31st March, 2015)

i. In respect of its fixed assets:

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

b. As explained to us, the Company has physically verified the assets in accordance with a phased program of verification, which in our opinion is reasonable, having regard to the size of the Company and the nature of its business. The reconciliation of assets so verified with the fixed assets register is in process.

ii. In respect of its inventories:

The Company is a service company, primarily rendering Project management services. Accordingly, it does not hold any inventories. Therefore, the provisions of Clause (ii) of Paragraph 3 of the Order are not applicable to the company.

iii. In respect of loans, secured or unsecured, granted by the Company to companies, firms or other parties covered in the register maintained under section 189 of the Act:

a. The Company has given advances in the nature of loan to its wholly owned subsidiary and as per the information and explanations given to us the above loan is repayable on demand. Receipt of interest is regular.

b. As the loan is repayable on demand, the question of overdue amount does not arise.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets and for the sale of services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system. There was no purchase or sale of goods during the year under audit.

v. According to the information and explanations given to us, the Company has not accepted any deposits from the public. Therefore, the provisions of Clause (v) of Paragraph 3 of the Order are not applicable to the Company.

vi. According to the information and explanations given to us, the Central Government has not prescribed the cost records to be maintained under sub-Section (1) of Section 148 of the Act in respect of activities carried on by the Company. Therefore the provisions of Clause (vi) of paragraph 3 of the Order are not applicable to the Company.

vii. According to the information and explanations given to us in respect of statutory dues:

a. The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees' State Insurance, Wealth tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess, to the extend applicable, with the appropriate authorities during the year. However delays have been noticed in depositing undisputed statutory dues in respect of Service Tax, Income Tax and Sales Tax with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of such statutory dues were outstanding as at 31st March, 2015 for a period of more than six months from the date they became payable except in case of Service Tax dues of Rs. 29,866,054 and Sales Tax of Rs. 50,000.

b. There are no disputed statutory dues of Income tax, Sales tax, Wealth tax, Service tax, Duty of Customs, Duty of Excise, Value added tax and Cess, which have not been deposited on account of disputed matters pending before appropriate authorities.

c. There is no delay in transferring amounts, required to be transferred, to Investor Education and Protection Fund in accordance with the relevant provision of the Companies Act, 1956 and rule made there-under.

viii. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

ix. Based on our audit procedures and information and explanations given by the management, we are of the opinion that as on 31st March, 2015 the Company has not defaulted in repayment of dues to financial institutions andbanks, except in the repayment of the principal amount of secured term loan of Rs. 39,075,493 and interest thereon of Rs. 527,743 where the period of default was more than 90 days.

x. The Company has given corporate guarantees aggregating to Rs. 105,000,000 for credit facilities taken by Artefact Infrastructure Limited (AIL), a wholly owned subsidiary of the Company, from a bank as at 31st March, 2015. The terms and conditions of the Corporate Guarantees are not prejudicial to the interest of the Company.

xi. The Company has not raised any new term loans during the year under audit. To the best of our knowledge and according to the information and explanations given to us the term loans outstanding at the beginning of the year have been applied for the purposes for which they were raised.

xii. In our opinion and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For Chaturvedi & Shah For Naresh Patadia & Co. Chartered Accountants Chartered Accountants Firm Reg. No. - 101720W Firm Reg. No. - 106936W

R. Koria Naresh Patadia Partner Proprietor Membership No. - 35629 Membership No. - 35620

Place: Mumbai Place: Nagpur Date: 30th May 2015 Date: 30th May 2015

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Mar 31, 2014

We have audited the accompanying financial statements of ARTEFACT PROJECTS LIMITED ("the Company"), which comprises Balance sheet as at March 31, 2014, 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 Principles Generally Accepted in India (Indian GAAPs), including Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act")read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of corporate affairs in respect of section 133 of the Companies Act, 2013.. 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.

Auditors'' 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.

Basis of qualification:

We refer to Note.15 of the financial statements wherein the Management of the Company has considered Trade Receivables amounting to Rs. 119,869,109/- as good and fully recoverable. In the absence of balance confirmations/reconciliations from the customers from whom these amounts are due or other alternate audit evidence to corroborate management''s assessment of recoverability of these balances and having regard to the age of these balances, we are unable to comment the extent to which these balances are recoverable.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us and except for the possible effects of the matter described in the basis for qualified opinion paragraph above, 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: -

i. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 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 under provisions of section 227(3) of the Act, we report that:

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

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

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

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of corporate affairs in respect of section 133 of the Companies Act, 2013.

e. On the basis of written representations received from the directors as on 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 Act.

ANNEXURE TO AUDITOR''S REPORT

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Artefact Projects Limited for the year ended March 31, 2014)

i. In respect of its fixed assets:

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

b. As explained to us, the Company has physically verified certain assets, in accordance with a phased program of verification, which in our opinion is reasonable, having regard to the size of the Company.The reconciliation exercise of assets so verified with the fixed asset register is in the process.

c. In our opinion, the Company has not disposed off substantial part of fixed assets during the year which has an impact on the going concern status of the Company.

ii. In respect of its inventories:

The Company is a service company, primarily rendering Project management services. Accordingly, it does not hold any inventories. Therefore, the provisions of clause 4(ii) of the Companies (Auditor''s Report) order, 2003 are not applicable to the company.

iii. In respect of loans, secured or unsecured, granted or taken by the companyto or from companies, firms or other parties covered in the register maintained under section 301 of the Act:

a. The Company has granted interest free loan to its wholly owned subsidiary in respect of which maximum amount involved during the year was Rs. 22,303,984 and the year-end balance was Rs. Nil.

b. In our opinion and according to the information and explanations given to us, other terms and conditions are not prima facie prejudicial to the interest of the Company.

c. As per the information and explanations given to us the above loan is repayment on demand and there is no repayment schedule.

d. Since there is no outstanding amount as on 31st March, 2014, the question of overdue amount does not arise.

e. The company has taken interest free loan from two such parties in respect of which maximum amount involved during the year was Rs. 22,579,321 and the year-end balance was Rs. 8,264,957.

f. In our opinion and according to the information and explanations given to us, other terms and conditions are not prima facie prejudicial to the interest of the Company.

g. As this loan is repayable on demand, the question of overdue amount does not arise.

h. Since there is no outstanding amount as on 31st March, 2014, the question of overdue amount does not arise.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of Services, fixed assets and also for the sale of services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v. In respect of the contracts or arrangements referred to in Section 301 of the Act:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements that needed to be entered in the register maintained under section 301 of the Act have been so entered.

b. In our opinion and according to the information and explanations given to us, these transactions made in pursuance of contracts / arrangements entered in the Register maintained under section 301 of the Act and exceeding the value of Rs. 500,000 in respect of each party during the year are of specific nature for which alternative quotations are not available and hence we are unable to comment upon.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from the public and hence directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Act and the rules framed there under are not applicable for the year under audit.

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

viii. The Central Government has not prescribed the maintenance of cost records under section 209 (1) (d) of the Act in respect of Project Management Consultancy Services carried out by the Company.

ix. According to the information and explanations given to us in respect of statutory dues:

a. The Company has been generally regular in depositing undisputed statutory dues of provident fund, investor education and protection fund, employees'' state insurance, wealth tax, custom duty, cess and any other material statutory dues with the appropriate authorities during the year however delays have been noticed in respect of service tax, income tax and sales tax. According to the information and explanations given to us, no undisputed amounts payable in respect of such statutory dues were outstanding as at March 31, 2014 for a period of more than six months from the date they became payable except for Service Tax and Tax Deducted at source Rs 9,197,950and Rs. 684,865 respectively.

b. The disputed statutory dues aggregating to Rs. 25,241,847 that have not been deposited on account of disputed matters pending before appropriate authorities are as under:

Name of the Nature of the Period to which then Statute Dues amount relates

Income Tax Act Income Tax 2004-05 to 2010-11

Name of the Amount (in Rs.) Forum where dispute is pending Statute (* )

Income Tax Act 25,241,847 Commissioner of income Tax (Appeals)

(*) Net of amount deposited under protest as mentioned in Note No. 26 (iii) to the financial statements.

x. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

xi. Based on our audit procedures, information and explanations given by the management, we are of the opinion that the company as on march 31, 2014 has not defaulted in the repayment of dues to banks.

xii. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company.

xiv. In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures & other investments. The Company has maintained proper records of transactions and contracts in respect of shares and timely entries have been made therein. All shares have been held by the Company in its own name.

xv. According to the information and explanations given by the management, the Company has given corporate guarantee for credit facilities taken by its subsidiary company from a bank as mentioned in Note No. 26(ii) which is prima facie not prejudicial to the interest of the Company.

xvi. The Company has not raised any new term loans during the year under audit. To the best of our knowledge and according to the information and explanations given to us the term loans outstanding at the beginning of the year have been applied for the purposes for which they were raised.

xvii. On the basis of review of utilization of funds, which is based on overall examination of the Balance Sheet of the Company as at March 31, 2014, related information as made available to us and as represented to us, by the management, we are of the opinion, that funds raised on short term basis have not prima facie been utilized for long term purposes.

xviii. The Company has not made any preferential allotment to parties and companies covered in the Register maintained under Section 301 of the Act.

xix. The Company has not issued any debentures, hence the provisions of clause 4 (xix) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

xx. During the year covered by our report the Company has not raised any money by public issue.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the company was noticed or reported during the course of our audit.



For Chaturvedi & Shah For Naresh Patadia & Co. Chartered Accountants Chartered Accountants Firm Reg. No. - 101720W Firm Reg. No. - 106936W

R. Koria Naresh Patadia Partner Proprietor Membership No. - 35629 Membership No. - 35620

Place: Mumbai Place: Nagpur Date: 29th May 2014 Date: 29th May 2014

---

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of ARTEFACT PROJECTS LIMITED ["the Company"],which comprises Balance sheet as atMarch 31, 2013, the Statement o'' 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 Principles Generally Accepted in India (Indian GAAPs), including Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' 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 statGments 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: -

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

ii. in the case of the Statement of Profit and Loss, of the Profit of the Company 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.

Emphasis of Matter

Without qualifying our opinion we draw your attention to the Note no.14regarding outstanding Trade Receivables, which are subject to confirmations but considered good for the reasons explained therein.

Report on Other Legal and Regulatory Requirements

i. As required by the Companies (Auditor''s Reportl 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 under provisions of section 227(3) of the Act, we report that:

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

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

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

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section [3C) of section 211 of the Act.

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 (ll of section 274 of the Act.

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Artefact Projects Limited for the year ended March 31,2013)

i. In respect of its fixed assets:

a. As per the information and explanations given to us. the records showing full particulars, including quantitative details and situation of fixed assets of the Company is being updated.

b. As explained to us, the Company has physically verified certain assets, in accordance with a phased program of verification, which in our opinion is reasonable, having regard to the size of the Company. The reconciliation exercise of assets so verified with the fixed asset register is in the process.

c. During the year, the company has not disposed off any fixed Assets.

ii. In respect of its inventories:

The Company is a service company, primarily rendering Project management services. Accordingly, it does not hold any inventories. Therefore, provisions of clause 4(ii) of the Companies [Auditor''s Report] order, 2003 are not applicable to the company.

iii. In respect of loans, secured or unsecured, granted or taken by the companyto or from companies, firms or other parties covered in the register maintained under section 301 of the Act:

a. The Company has granted interest free loan to its wholly owned subsidiary in respect of which maximum amount involved during the year was Rs. 17.366.120 and the year-end balance was Rs. 17.366120.

b. In our opinion and according to the information and explanations given to us, other terms and conditions are not prima facie prejudicial to the interest of the Company.

c. As per the information and explanations given to us the above loan is repayment on demand and there is no repayment schedule.

d. As this loan is repayable on demand, the question of overdue amount does not arise.

e. The company has taken interest free loan from three such parties in respect of which maximum amount involved during the year was Rs. 14.99Rs.,000 and the year-end balance was Rs. Nil.

f. In our opinion and according to the information and explanations given to us, other terms and conditions are not prima facie prejudicial to the interest of the Company.

g. 5ince there is no outstanding amount as on 31st March, 2013, the question of overdue amount does not arise.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of Services, fixed assets and also for the sale of services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v. In respect of the contracts or arrangements referred to in Section 301 of the Act;

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered in the register maintained under section 301 of the Act have been so entered.

b. In our opinion and according to the information and explanations given to us, these transactions made in pursuance of contracts / arrangements entered in the Register maintained under section 301 of the Act and exceeding the value of Rs. 5,00,000 in respect of each party during the year are of specific nature for which alternative quotations are not available and hence we are unable to comment upon.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from the public and hence directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Act and the rules framed there under are not applicable for the year under audit.

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

viii. The Central Government has not prescribed the maintenance of cost records under section 209 111 Id) of the Act in respect of Project Management Consultancy Services carried out by the Company.

ix. According to the information and explanations given to us in respect of statutory dues:

The Company has been generally regular in depositing undisputed statutory dues of provident fund, investor education and protection fund, employees'' state insurance, weaL:h tax, custom duty, cess and any other material statutory dues with the appropriate authorities during the year however delays have been noticed in respect of service tax, income tax and sales tax. According to the information and explanations given to us, no undisputed amounts payable in respect of such statutory dues were outstanding as at March 31, 2013 for a period of more than six months from the date they became payable except for Service Tax, Tax Deducted at source and MVAT amountingto Rs. 3,B13,103, Rs. 88,535 and Rs. 1,93,808 respectively, out of which MVAT amounting to Rs.1,93,808 has since been paid.

x. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

xi. Based on our audit procedures, information and explanations given by the management, we are of the opinion that the company as on march 31, 2013 has not defaulted in the repayment of dues to banks except for overdue amount of loans and interest aggregating to Rs. 2,107,368 to banks. The same has since been paid.

xii. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund/society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company.

xiv. In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures & other Investments. The Company has maintained proper records of transactions and contracts in respect of shares and timely entries have been made therein. All shares have been heLd by the Company in its own name.

xv. According to the information and explanations given by the management, the Company has given corporate guarantee for redit facilities taken by the subsidiary company from a bank as mentioned in Note No. 25 (a) (ii) which is prima facie not prejudicial to the interest of the Company.

xvi. To the best of our knowledge and according to the information and explanations given to us the term loans outstanding at the beginning of the year and those raised during the year have been applied for the purposes for which they were raised.

xvii. On the basis of review of utilization of funds, which is based on overall examination of the BaLance Sheet of the Company as at March 31, 2013, related information as made available to us and as represented to us, by the management, we are of the opinion, that funds raised on short term basis have not prima facie been utilized for long term purposes.

xviii. The Company has not made any preferential allotment to parties and companies covered in the Register maintained under Section 301 of the Act.

xix. The Company has not issued any debentures, hence the provisions of clause 4 [xix] of the Companies [Auditor''s Reportl Order, 2003 are not applicable to the company.

xx. During the year covered by our report the Company has not raised any money by public issue.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the company was noticed or reported during the course of our audit.

For Chaturvedi & Shah For Naresh Patadia & Co.

Chartered Accountants Chartered Accountants

Firm Reg. No.- 101720W Firm Reg. No.- 106936W

R. Koria Naresh Patadia

Partner Proprietor

Membership No. - 35029 Membership No.- 35620

Place: Mumbai Place; Nag pur

Date: 28th May 2013 Date: 28th May 2013

---

Mar 31, 2012

1. We have audited the attached Balance Sheet of ARTEFACT PROJECTS LTD, as at March 31, 2012 and also the Statement of Profit and Loss and Cash Flow Statement of the Company 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 Auditing Standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. Without qualifying our opinion attention is drawn to the balances outstanding as on 31st March 2012 in case of Trade Receivables and Trade Payables, which are subject to confirmations.

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

5. Further to our Comments in the Annexure referred to in Paragraph 4 above, we report that:

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

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

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

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

e) On the basis of the written representations received from the directors as on March 31, 2012 and taken on records 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 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, the said accounts read together with the significant accounting policies and 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 March 31, 2012;

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

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

For Chaturvedi & Shah For Naresh Patadia & Co.

Chartered Accountants Chartered Accountants

Firm Reg.No.101720W Firm Reg.No.106936W

R.Koria Naresh Patadia

Partner Proprietor

Membership No. - 35629 Membership No. - 35620

Mumbai

Date: May 30 ,2012

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of ARTEFACT PROJECTS LIMITED, as at 31st March, 2010 and also the Profit and Loss Account and Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Sub-section (4A) of Section 227 of the Companies Act, 1956, we give in theAnnexure hereto, a statement on the matters specified in paragraphs 4 and 5 of the said Order, to the extent applicable to the company.

4. We report that:

i. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of ouraudit;

ii. In ouropinion, proper books of account, as required by law, have been kept by the Company, so far as appears from our examination of such books;

iii. The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

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

v. On the basis of the written representations received from the directors as on 31s1 March, 2010 and taken on records by the Board of Directors, we report that none of the directors is disqualified as on 31s1 March, 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act 1956.

5. In our opinion and to the best of our information and according to the explanations given to us, the said accounts, 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, 2010;

ii. in the case of Profit and Loss Account, of the profits of the Company for the year ended on that date; and

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

ANNEXURE TO AUDITORS REPORT Referred to in paragraph 3 of our report of even date

i. In respect of its fixed assets:

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

b. As explained to us, the Company has physically verified all its fixed assets, which in our opinion is reasonable, having regard to the size of the Company.

c. The Company has not disposed off any fixed assets during the year and accordingly the going concern status of the Company is not affected.

ii. The Company is a Service Company, primarily rendering project management services. Accordingly, it does not hold any inventories. Therefore, provisions of clause 4 (ii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

iii. According to the information and explanations given to us, the company has not granted or taken any loans, secured or unsecured to or from companies, firms, or other parties covered 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 is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of services, fixed assets and also for the sale of services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v. According to information and explanations given to us, there are no contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered in the register required to be maintained underthat section.

vi. According to information and explanations given to us, the Company has not accepted any deposits from the public and hence directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable for the year under audit.

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

viii. The Central Government has not prescribed the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 in respect of Project Management Consultancy Services carried out by the Company.

ix. According to the information and explanations given to us in respect of statutory dues:

a. The company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs Duty, Excise Duty, Cess and any other statutory dues with the appropriate authorities during the year except in few cases, in respect of undisputed Provident Fund, Employees, State Insurance, Income Tax and Service Tax.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of such statutory dues were outstanding as at 31st March, 2010 for a period of more than six Months from the date they become payable except for Fringe Benefit Tax amounting to ?. 2,048,296/- (Rs.) . 704981 has since been paid), and Professional Tax amounting to Rs. 170,444/-

c. According to the information and explanations given to us, there are no disputed statutory dues, which have not been deposited on account of disputed matters pending before appropriate authorities.

x. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

xi. Based on our Audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in the repayment of dues to Banks..

xii. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund or a nidhi /mutual benefit fund/society. Therefore, the provisions of clause 4 (xiii) of the Companies (Auditors Report) Order, 2003 is not applicable to the Company.

xiv. During the year, there was no transaction and contracts in respect of trading in shares and other securities by the Company. The old investments are held by the Company in its own name.

xv. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from Banks and Financial Institutions.

xvi. The company has raised new term loan during the year. To the best of our knowledge and according to the information and explanations given to us the term loan outstanding at the beginning of the year and those raised during the year were prima-facie been either used for the purpose for which they were raised or pending utilization been temporarily placed with banks.

xvii. On the basis of review of utilization of funds, which is based on overall examination of the Balance Sheet of the Company as at 31st March, 2010, related information as made available to us and as represented to us, by the management, we are of the opinion, that the funds raised on short term basis have not prima facie been utilized for long term purposes.

xviii. During the year the Members, in the Extra - Ordinary General Meeting held on 23rd February, 2010 has approved issue of Equity Shares and Warrants on Preferential basis to the parties covered in the Register maintained under section 301 of the Companies Act, 1956. However, as at 31st March, 2010 the same were not allotted.

xix. The Company has not issued any debentures, hence the provisions of clause 4 (xix) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

xx. During the year covered by our report the company has not raised any money by public issue.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the company was noticed or reported during the course of our audit.



For Chaturvedi & Shah For Naresh Patadia & Co.

Chartered Accountants Chartered Accountants

Firm Reg. No. -101720W Firm Reg. No.- 106936W

Sd/- Sd/-

R. Koria Naresh Patadia

Partner Proprietor

Membership No. - 35629 Membership No. - 35620

Place : Nagpur

Date :31st May, 2010