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Auditor Report of Autoline Industries Ltd.

Mar 31, 2016

To The Members of Autoline Industries Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of AUTOLINE INDUSTRIES LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2016; the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, 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 and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes 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 misstatements, whether due to fraud or error.

Auditor’s Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and 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 of 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 audit opinion on the standalone financial statements

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the company as at March 31, 2016 and its loss and cash flows for the year ended on that date.

EMPHASIS OF THE MATTER

Without qualification, we draw your attention to the following:-

Sub Note to Note No. 9 of schedule of notes to the financial statements for non provision of diminution in the value of investment amounting to Rs.32.84 crores in subsidiary Koderat Investments Limited (Cyprus), the note is self-explanatory and the matter is subjudice with Italian courts and therefore no effect has been given in these Standalone financial statements. In the given circumstances, we are unable to express our opinion on the matter.

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor’s Report) Order, 2016 issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, (hereinafter referred to as the “the Order”), and on such checks of the books and records of the company as we considered appropriate and according to the information and explanation given to us, we give Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the order.

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.

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

c) the Balance Sheet, the Statement of Profit and Loss and 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) on the basis of written representations received from the directors, as on March 31, 2016 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2016 from being appointed as a Director in terms of Section 164 (2) of the Act.

f) 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 B’; and

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 financial statements.

ii. The company has long-term contracts as at March 31, 2016 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31, 2016.

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

The Annexure referred to in our Independent Auditors’ Report to the members of the Company on the standalone financial statements for the year ended March 31, 2016, we report that:

i) a) The company has maintained proper records showing full particulars, including quantitative details and situations of its Fixed Assets.

b) According to the information and explanation given to us, the company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in phased manner over a period of three years. In accordance with this programme, certain fixed assets were verified during the year. In our opinion, this periodicity of physical verification is reasonable having regards to the size of the Company and the nature of its business and no discrepancies have been noticed on such physical verification.

c) According to the information and explanation given to us and on the basis of our examination of the records of the company, except for the following three cases, the title deeds were held in the name of the company

(Rs.In lakhs)

Sr. No.

Particulars

Whether Leasehold Or Freehold

Gross Block as on Balance Sheet Date

Net Block as on Balance Sheet Date

Remarks

1.

F-II, Plot no.24,25 Pimpri, Pune, Maharashtra

Leasehold

101.97

69.12

Lease Deed is held in the name of M/s Western Pressing Pvt. Ltd. which was amalgamated with the company

2.

Khasra no. 423, SIDCUL, Plot no.5 Uttarakhand

Leasehold

22.86

20.32

Lease Deed is held in the name of M/s Nirmiti Auto components Pvt. Ltd. which was amalgamated with the company

3.

E 12, 17(8), Bhosari, Pune Maharashtra

Leasehold

83.04

47.97

Lease Deed is held in the name of M/s Nirmiti Autocomponents Pvt. Ltd. which was amalgamated with the company

ii) a) The inventories have been physically verified at reasonable intervals by the management.

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 were reasonable and adequate in relation to the size of the company and the nature of its business.

iii) The company has granted loan to one party covered in the register maintained under section 189 of the Companies Act, 2013.

a) In our opinion, the rate of interest and other terms and conditions on which the loan had been granted to the party listed in the register maintained under section 189 of the Act were not, prima facie, prejudicial to the interest of the company.

b) Since loan is repayable on demand clause (b) and (c) are not commented by us.

iv) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of Section 185 and 186 of the Act, with respect to the loans and investment made.

v) The company has not accepted any deposit from public.

vi) As per information and explanation given to us, the Central Government has not prescribed maintenance of cost records as required under sub section (1) of Section 148 of the Companies Act, 2013.

vii) a) According to the records, the Company is regular in depositing undisputed statutory dues in respect of duty of customs. However undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of excise, value added tax, cess and other statutory dues have not been regularly deposited with the appropriate authorities and there have been delays in depositing the same.

Sr.

No.

Name of statutory dues

Nature of dues

Total (in Rs)

Period to which it relates

Whether paid before balance sheet signing

1

Maharashtra Value Added Tax-2005

MVAT

3,18,66,416

F.Y. 2013-14

No

2

Maharashtra Value Added Tax-2005

MVAT

2,72,73,326

F.Y. 2014-15

No

3

Maharashtra Value Added Tax-2005

MVAT

15,00,001

August, 2015

No

4

Maharashtra Municipal Corporation Act-1949

LBT

2,89,84,384

October 2013 to September 2015

No

b) According to the information and explanations given to us, following amounts are payable in respect of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax and cess as at March 31, 2016 on account of disputes:-

Name of the Statute

Nature of Dues

Forum where Dispute is pending

Period to which the amount relates

Tax Amount involved (Rs.)

Income Tax Act, 1961

Income Tax

Income Tax Appellate Tribunal

F.Y. 2008-09

36,58,482/-

Income Tax Act, 1961

Income Tax

The Commissioner of Income Tax (Appeals), Pune

F.Y. 2009-10

8,26,620/-1

Income Tax Act, 1961

Income Tax

DRP-3 WZ, Mumbai

F.Y.2011-12

4,32,090/-

The Maharashtra Value Added Tax Act, 2002/ Central Sales Tax Act, 1956

VAT / CST

The Joint Commissioner of Sales Tax (Appeals), Pune

F.Y. 2000-01 F.Y. 2001-02 F.Y. 2002-03 F.Y. 2003-04 F.Y. 2004-05 F.Y. 2005-06 F.Y. 2006-07 F.Y. 2007-08 F.Y. 2008-09 F.Y.2009-10 F.Y.2010-11 F.Y.2011-12

1,34,44,440/-2

1,29,42,721/-*

95,983/

6,11,670/-*

5,57,742/-*

1,47,11,024/-*

2,78,01,682/-*

4,73,28,640/-*

11,89,05,585/-*

3,34,50,514/-*

10,55,94,435/-*

4,07,123/-

vii) According to the information and explanations given to us and according to the books and records as produced and examined by us, following undisputed statutory dues were in arrears as at March 31, 2016 for a period of more than six months from the date they became payable.

ix) The company did not raise money by way of initial public offer or further public offer (including debt instrument) and term loans during the year. Accordingly, paragraph 3 (ix) of the order is not applicable.

x) According to the information and explanations given to us, no material fraud on or by the company has been noticed or reported to us during the year by the management.

xi) According to the information and explanation given to us and based on our examination of the records, company is in the process of obtaining approval of Central Government for amount paid/provided towards managerial remuneration as required by the provisions of section 197 read with schedule V to the Act, amount involved was Rs.55,12,465/-. Company has obtained personal guarantee letter as a security of the said amount.

xii) In our opinion and according to the information and explanation given to us, the company is not a nidhi company. Accordingly, paragraph 3(xii) of the order is not applicable.

xiii) According to the information and explanations given to us and based on our examinations of the records of the company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv) The company had made preferential allotment of shares during the year under review and the requirements of section 42 of the Companies Act, 2013 have been complied with and the amount raised has been used for the purposes for which the funds were raised.

xv) According to the information and explanation given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the order is not applicable.

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

‘ANNEXURE B’ TO THE INDEPENDENT AUDITORS’ REPORT

Report on the Internal Financial Controls 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 AUTOLINE INDUSTRIES LIMITED (“the Company”) as of March 31, 2016 in conjunction with our audit of the standalone 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, 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 on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls both applicable to an audit of Internal Financial Control and both issued by the Institute of Chartered Accountants of India. 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 were established and maintained and whether 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 audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

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, o that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over finance. reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 201 however company is required to strengthen its financial control for obtaining balance confirmations from trade receivable & payables 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 issued by the Institute of Chartered Accountants of India” (ICAI).

FOR A. R. SULAKHE & CO

CHARTERED ACCOUNTANTS

FRN: - 110540W

ANAND SULAKHE

PARTNER

M. NO.33451

May 28, 2016

Pune


Mar 31, 2015

We have audited the accompanying standalone financial statements of AUTOLINE INDUSTRIES LIMITED ("the Company"), which comprise the Balance Sheet as at March 31,2015; the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, 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 and presentation of these standalone financial statements that give a true and fair view ofthe financial position, financial performance and cash flows ofthe Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes 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 ofthe financial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.

Auditor's Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and 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 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 ofthe 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 controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 on the standalone financial statements.

Basis for Qualified Opinion

Provision for Gratuity and Leave Encashment is made on an estimated basis, which is not in accordance with Accounting Standard -15 Employee Benefits. In the absence ofthe required information effect ofthe same on the Standalone financial statements are not quantified.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the paras mentioned in Basis for qualified opinion 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 March 31,2015, and its loss and cash flows for the year ended on that date.

EMPHASIS OF THE MATTER

Without qualification, we draw you attention to the following:-

Sub Note to Note No. 10 of schedule of notes to the financial statements for non provision of diminution in the value of investment amounting to Rs. 32.63 crores in subsidiary Kodrat Investments Limited (Cyprus), the note is self-explanatory and the matter is subjudice with Italian courts and therefore no effect has been given in these Standalone financial statements. In the given circumstances we are unable to express our opinion on the 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 said order.

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 paras mentioned in qualified opinion;

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

c) the Balance Sheet, the Statement of Profit and Loss and 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 exceptfor Accounting Standard 15 Employee Benefits.

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; and

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

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements.

ii. the Company has made provisions, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long term contracts including derivative contracts except for the paras mentioned in qualified opinion

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

Annexure to the Independent Auditors' Report:

The Annexure referred to in our Independent Auditors' Report to the members of the Company on the standalone financial statements for the year ended March 31,2015,we report that:

i) a) The company has maintained proper records showing full particulars, including quantitative details and situations of its Fixed Assets

b) According to the information and explanation given to us, the Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in phased manner over a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regards to the size of the Company and the nature of its assets

ii) a) The inventories have been physically verified at reasonable intervals by the management.

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.

iii) The company has not granted loans to the parties covered in the register under section 189 of Companies Act, 2013.

iv) In our opinion and accordingly to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in the internal control system during;

v) The company has not accepted any deposit from public;

vi) The Central Government has not prescribed maintenance of cost records under sub section (1) of Section 148 of the Act;

vii) a) Company is regular in depositing undisputed statutory dues in respect of wealth tax, duty of customs. However undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, service tax, duty of excise, value added tax, cess and other statutory dues have not been regularly deposited with the appropriate authorities and there have been delays in depositing the same.

According to the information and explanations given to us, and according to the books and records as produced and examined by us following undisputed statutory dues were in arrears as at March 31, 2015 for a period of more than six months from the date they became payable-

Sr. Name of statutory dues Nature of Total (in Rs) No. dues

1 MaharashtraValue Added MVAT 5,09,30,440 Tax-2005

2 MaharashtraValue Added CST 68,742 Tax-2005

3 MaharashtraMunicipal LBT 1,35,44,405 Corporation Act-1949

4 ProfessionalTax Act PT 11,51,925

Sr. Name of statutory dues Period to which it Whether paid No. relates before balance sheet signing

1 MaharashtraValue Added April 2012 to No Tax-2005 August 2014

2 MaharashtraValue Added March2013 No Tax-2005

3 MaharashtraMunicipal October2013to No Corporation Act-1949 August 2014

4 ProfessionalTax Act April2014to No August 2014

b) According to the information and explanations given to us, following amounts are payable in respect of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax and cess as at March 31,2015 on account of disputes:-

Name of the Statute Nature of Forum where Dispute is Dues pending

Income Tax Act,1961 Income Tax Income Tax Appellate Tribunal

Income Tax Act,1961 Income Tax Income Tax Appellate Tribunal

Income Tax Act,1961 Income Tax The Commissioner of Income Tax (Appeals), Pune

The Maharashtra Value VAT / CST The Joint Commissioner of Added Tax Act, 2002 / Sales Tax (Appeals), Pune Central Sales Tax Act, 1956

Name of the Statute Period to which the Tax amount relates Amount involved (Rs.)

Income Tax Act,1961 F.Y.2007-08 4,01,94,113/-

Income Tax Act,1961 F.Y.2008-09 36,58,482/-

Income Tax Act,1961 F.Y.2009-10 8,26,620/-

The Maharashtra Value F.Y.2000-01 1,34,44,440/-* Added Tax Act, 2002 / F.Y.2001-02 1,29,42,721/-* Central Sales Tax Act, 1956 F.Y.2002-03 95,983/-

F.Y. 2003-04 6,11,670/-*

F.Y. 2004-05 5,57,742/-*

F.Y. 2005-06 1,47,11,024/-*

F.Y. 2006-07 2,78,01,682/-*

F.Y. 2007-08 5,13,84,343/-*

F.Y. 2008-09 12,74,05,585/-

F.Y.2009-10 49,82,954/-*

F.Y.2010-11 11,49,84,435/-1

* net of amounts paid under protest.

c) In our opinion and According to the information and explanations given to us, amounts required to be transferred to the Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder have been transferred to such fund within time.

viii) According to the information and explanations given to us, the company does not have any accumulated losses at the end of financial year and has incurred cash losses during the current financial year and immediately preceding financial year;

ix) According to the information and explanations given to us, the company has defaulted in repayment of dues to banks, however during the year facilities sanctioned to the company were rescheduled for repayment by consortium of Company bankers and as such as on March 31, 2015 there were no defaults in repayment of dues to banks for this rescheduled loan. Howeverforother facility, in our opinion, the company has defaulted in repayment of its dues to banks forinterest amounting to Rs. 34,59,928/- as at balance sheet date, delay ranging from 0 to 90 days and the same was paid till signing balance sheet;

x) In our opinion and according to information and explanation given to us, the company has not given any guarantees for loans taken by others from banks orfinancial Institution;

xi) Based on the information and explanations given to us by management, prima facie the term loans were applied for the purpose forwhich the loans were obtained;

xii) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported to us during the year by the management;



FOR A. R. SULAKHE & CO CHARTERED ACCOUNTANTS FRN: - 110540W

ANAND SULAKHE Partner M. NO.33451

Date: May 27, 2015 Place: Pune


Mar 31, 2014

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

Management''s Responsibility 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 the General Circular No. 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

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

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at31st March, 2014;

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

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

Without qualifying our opinion, we draw attention to:-

Sub-note to note no. 9 regarding non provision for diminishing in value of investment in subsidiary Koderat Investments Limited (Cyprus). The note is self-explanatory. In the given circumstances we are unable to give our opinion. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003, as amended by the companies (Auditor''s Report) Amendment order, 2004 (together the "Order"), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the company as we considered appropriate and according to information and explanation given to us, we enclose in the annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent applicable to the company.

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

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

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

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

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 read with the General Circular No. 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

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

ANNEXURE TO INDEPENDENT AUDITOR''S REPORT

[Annexure Referred to in paragraph 1 of the Auditors'' Report of even date to the members of AUTOLINE INDUSTRIES LIMITED on the Accounts for the Year Ended on 31st March, 2014]

1) In respect of Fixed Assets

a) The Company has generally maintained proper records showing particulars including quantitative details and situation of Fixed Assets on the basis of information available.

b) According to the information and explanation given to us, the fixed assets are physically verified by the management according to the phased programme which in our opinion is reasonable having regard to the size of the company and the nature of its assets. On physical verification by the management no major discrepancies between the book record and physical inventory have been noticed.

c) In our opinion, the company has not disposed off a substantial part of its Fixed Assets and the going concern status is not affected.

2) In respect of its Inventories:

a) The inventory of the Company has been physically verified by the management during the year at regular interval. In our opinion the frequency of verification is reasonable.

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

c) According to the information and explanation given to us no material discrepancies were noticed on physical verification of inventories as compared to book records, discrepancies noticed were properly dealt with, in the books of accounts, which were not material considering the size of the companies operation.

3) a) As per the information and explanation given to us, the company has not granted any secured or unsecured loan to companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act 1956 during the year .Consequently clause (iii) (b), (iii) (c) & (iii) (d) of the order is not applicable.

b) As per the information and explanation given to us, the company has not accepted any unsecured loan from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act 1956 during the year. Consequently clause (iii) (f) & (iii) (g) of the order is not applicable.

4) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls system.

5) In respect of transaction covered under section 301 of the Companies Act 1956 :

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

b) In our opinion and according to the information and explanations given to us, the transaction made in pursuance of such contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5 lacs in respect of each party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) According to the information and explanation given to us, the company has not accepted any deposits from public. Therefore, the provisions of Clause 4(vi) of the Order are not applicable to the Company.

7) The Company has an internal audit functions carried out during the year by a firm of chartered accountants appointed as internal auditor by the management and in our opinion, company''s present internal audit system is commensurate with the size of the company and the nature of its business.

8) We have broadly reviewed the books of account maintained by the company in respect of products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of subsection (1) of section 209 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. The same are verified by external cost auditor appointed by company for carrying cost audit and his report were awaited till date of signing the auditor''s report. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9) a) According to the information and explanations given to us and according to the books and records as produced and examined by us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, E.S.I., Income Tax, Sales Tax, LBT, Wealth Tax, Service Tax, Excise Duty, Customs Duty, Cess and any other material statutory dues, to the extent applicable, have been generally regularly deposited with the appropriate authorities. According to the information and explanations given, no undisputed amount payable in respect of aforesaid dues were outstanding as at 31st March, 2014, for a period of more than six months from the date they became payable except for MVAT Rs. 2,34,05,538/-, CST Rs. 68,742/- and LBT Rs. 32,79,434/-, which is till date of the signing of report.

b) As at 31st March 2014, according to the records of the Company and on the basis of information and explanations given to us, except for Income Tax & Sales Tax (VAT), there are no disputed dues in respect of Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess.

Name of the Nature of Dues Forum where Dispute is Period to which the Tax Amount

Statute pending amount relates involved (Rs.)

Income Tax Act, Dues on Assessment Income Tax Appellate Tribunal FY. 2008-09 36,58,482/-

1961

Income Tax Act, Dues on Assessment The Commissioner of Income FY. 2009-10 8,26,620/-

1961 Tax (Appeals), Pune

The Mahara shtra VAT / CST The Joint Commissioner of FY 2000-01 1,59,44,440/-

Value Added Sales Tax (Appeals), Pune FY 2001-02 1,54,42,721/-

Tax Act, 2002

/ Central Sales FY 2002-03 95,983/-

FY 2003-04 10,11,670/-

F.Y 2004-05 9,57,742/-

F.Y 2005-06 1,90,22,000/-

F.Y 2006-07 12,55,746/-

F.Y 2007-08 6,79,341/-

F.Y 2008-09 148,252/-

10) The Company has no accumulated losses as at 31st March, 2014, but has incurred cash losses during the financial year ended on that date. The Company has not incurred any cash losses in the immediately preceding financial year.

11) Based on our audit procedures and on the information and explanations given by the Management, in our opinion, the Company has defaulted in repayment of its dues to banks as at the balance sheet date. Following are the defaults :-

Sr. No. Amount (Including Interest) - Rs. in Lacs Period of Delay (after due date) Paid before Signing of Balance Sheet

1 186.38 0 to 30 days Yes

2 585.01 31 to 60 days Yes

3 2325.73 61 to 90 days Yes

4 203.92 Above 90 days Yes

5 3.33 0 to 30 days No

6 342.46 31 to 60 days No

7 332.12 61 to 90 days No

8 163.95 Above 90 days No

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

13) In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute and provisions applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14) In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in securities.

15) In our opinion, and according to the information and explanations given to us, the Company has given corporate guarantee of $ 10.5 Million for the loans taken by a foreign subsidiary company from banks or financial institutions. In our opinion the terms and conditions thereof are not prejudicial to the interest of the company.

16) According to the information and explanation given to us, company has raised term loan during the year. On the basis of the information and explanation given to us and on an overall examination of the financial statements of the company, we are of the opinion that, prima facie the term loan is applied for the purposes for which they were obtained.

17) According to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short term basis have been used for long term purposes.

18) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

19) No debentures have been issued during the year.

20) During the year the Company has not raised money by public issue.

21) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

FOR K V M D S & ASSOCIATES,

CHARTERED ACCOUNTANTS.

FIRM REG. NO.: 121347W

CA. VIJAY B. SHETH PLACE: PUNE. PARTNER

DATE : 24th MAY, 2014. MEM. NO. 037634


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

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

Opinion

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

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2013; (ii) in the case of the Statement of Profit and Loss Account, of the profit/ loss for the year ended on that date; and (iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Without qualifying our opinion, we draw attention to:-

- Sub-note to note no. 9 regarding non provision for diminishing in value of investment in subsidiary Koderat Investments Limited (Cyprus). The note is self-explanatory. In the given circumstances we are unable to give our opinion.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003, as amended by the companies (Auditor''s Report) Amendment order, 2004 (together the "Order"), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the company as we considered appropriate and according to information and explanation given to us, we enclose in the annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent applicable to the company.

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

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

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

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

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

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

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

ANNEXURE TO AUDITORS'' REPORT

[ Annexure Referred to in paragraph 1 of the Auditors'' Report of even date to the members of AUTOLINE INDUSTRIES LIMITED on the Accounts for the Year Ended on 31st March, 2013]

1) In respect of Fixed Assets

a) The Company has generally maintained proper records showing particulars including quantitative details and situation of Fixed Assets on the basis of information available.

b) According to the information and explanation given to us, the fixed assets are physically verified by the management according to the phased programme which in our opinion is reasonable having regard to the size of the company and the nature of its assets. On physical verification by the management no major discrepancies between the book record and physical inventory have been noticed.

c) In our opinion, the company has not disposed off a substantial part of its Fixed Assets and the going concern status is not affected.

2) In respect of its Inventories: (Excluding stock with third parties & material in transit).

a) The inventory of the Company has been physically verified by the management during the year at regular interval. In our opinion the frequency of verification is reasonable.

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

c) According to the information and explanation given to us no material discrepancies were noticed on physical verification of inventories as compared to book records, discrepancies noticed were properly dealt with, in the books of accounts, which were not material considering the size of the companies operation.

3) a) As per the information and explanation given to us, the company has granted unsecured loan to Autoline

Industrial Parks Limited (subsidiary company), which is covered in the Register maintained under Section 301 of the Companies Act 1956. In respect of the said loan, the maximum amount outstanding at any time during the year was ~ 10,95,50,545/- and the year-end balance is ~ 10,95,50,545/-.

b) In our opinion, and according to the information and explanations given to us, 13 % per annum interest has been charged to subsidiary company and other terms and conditions of loan given by the company are not prima facie, prejudicial to the interest of the Company.

c) There is no prescribed stipulation of repayment of principal & interest.

d) In respect of loan granted by company, the same are repayable on demand and therefore question of overdue amount does not arise.

e) As per the information and explanation given to us, the company has taken interest free unsecured loan from 2 parties covered in the Register maintained under Section 301 of the Companies Act 1956. The total amount of such loans received and outstanding as of 31st March, 2013 is ~ 1,45,23,221/-.

f) The advance accepted by the company is from Promoters & other party, and as such the terms and conditions of this advance are not prejudicial to the interest of the company.

g) There is no prescribed stipulation of repayment of principal & interest.

4) In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls system.

5) In respect of transaction covered under section 301 of the Companies Act 1956 :

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

b) In our opinion and according to the information and explanations given to us, the transaction made in pursuance of such contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of ~ 5 lacs in respect of each party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) According to the information and explanation given to us, the company has not accepted any deposits from public. Therefore, the provisions of Clause 4(vi) of the Order are not applicable to the Company.

7) The Company has an internal audit functions carried out during the year by a firm of chartered accountants appointed as internal auditor by the management and in our opinion, company''s present internal audit system is commensurate with the size of the company and the nature of its business.

8) We have broadly reviewed the books of account maintained by the company in respect of products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of subsection (1) of section 209 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. The same are verified by external cost auditor appointed by company for carrying cost audit and his report were awaited till date of signing the auditor''s report. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9) a) According to the information and explanations given to us and according to the books and records as produced and examined by us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, E.S.I., Income Tax, Sales Tax (VAT), Wealth Tax, Service Tax, Excise Duty, Customs Duty, Cess and any other material statutory dues, to the extent applicable, have been generally regularly deposited with the appropriate authorities. According to the information and explanations given, no undisputed amount payable in respect of aforesaid dues were outstanding as at 31st March, 2013, for a period of more than six months from the date they became payable except for MVAT~ 78,79,137/- and CST ~ 55,877/-, which is paid before the signing of report.

b) As at 31st March 2013, according to the records of the Company and on the basis of information and explanations given to us, except for Income Tax & Sales Tax (VAT), there are no disputed dues in respect of Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess.



Name of the Nature of Dues Forum where Period to which Tax Amount Statute Dispute is pending the amount relates involved

Income Tax Act, 1961 Transfer Pricing Dispute Resolution FY. 2008-09 " 41,13,836/- Panel, Pune

The Maharashtra VAT / CST The Joint FY. 2000-01 " 1,10,00,000/- Value Added Tax Commissioner Act, 2002 / Central of Sales Tax Sales Tax Act, 1956 (Appeals), Pune FY 2001-02 " 1,25,00,000/-

10) The Company has no accumulated losses as at 31st March, 2013, and has not incurred any cash losses during the financial year ended on that date and in the immediately preceding financial year.

11) Based on our audit procedures and on the information and explanations given by the Management, in our opinion, the Company has not defaulted in repayment of its dues to any financial institution or bank or Debenture holder as at the balance sheet date.

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

13) In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute and provisions applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14) In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in securities.

15) In our opinion, and according to the information and explanations given to us, the Company has given corporate guarantee for the loans taken by a subsidiary company from banks or financial institutions. In our opinion the terms and conditions thereof are not prejudicial to the interest of the company.

16) According to the information and explanation given to us, company has raised term loan during the year. On the basis of the information and explanation given to us and on an overall examination of the financial statements of the company, we are of the opinion that, prima facie the term loan is applied for the purposes for which they were obtained.

17) According to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short term basis have been used for long term purposes.

18) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

19) No debentures have been issued during the year.

20) During the year the Company has not raised money by public issue.

21) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.



FOR K V M D S & ASSOCIATES, (FORMERLY KNOWN AS GUJAR RAWAT SHETH & ASSOCIATES)

CHARTERED ACCOUNTANTS. FIRM REGISTRATION NO: 121347W

PLACE : PUNE. VIJAY B SHETH

DATE : 18TH MAY, 2013. PARTNER.

MEM. NO. 037634


Mar 31, 2012

We have audited the attached BALANCE SHEET of AUTOLINE INDUSTRIES LIMITED as at 31st March 2012, the Statement of Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

1. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in 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 presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) Amendment order, 2004 (together the "Order"), issued by the Central Government of India in terms of section 227 (4A) of Companies Act, 1956 and on the basis of such checks of the books and records of the company as we considered appropriate and according to information and explanation given to us, we enclose in the annexure hereto a statement on the matters specified in paragraph 4 & 5 of the said order to the extent applicable to company.

3. Further to our comments in the Annexure referred to in paragraph 2 above we Report that:

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

b) 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 the books of accounts of the company.

c) The Balance Sheet, Statement of Profit & Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the Books of Accounts.

d) Without qualifying our opinion, we draw attention to -

(i) Sub-note to note no.9 regarding non provision for diminishing in value of investment in subsidiary Koderat Investments Ltd. (Cyprus). The note is self explanatory. In the given circumstances we are unable to give our opinion.

e) In our opinion and subject to Note to Accounts, the Balance Sheet, Statement of Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the requirement of the Accounting Standard referred to in sub section (3C) of section 211 of Companies Act, 1956, to the extent applicable.

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

g) In our opinion and to the best of our information and according to the explanations given to us the said accounts read together with Significant Accounting Policies, and Notes to Accounts and subject to our observations in 3(d) above 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 case of the Balance Sheet, of the state of affairs of the Company as on 31st March, 2012.

ii) In the case of the Statement of Profit & Loss Account of the Profit for the year ended on that date.

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

ANNEXURE TO AUDITOR'S REPORT

[ Annexure Referred to in paragraph 2 of the Auditors' Report of even date to the members of AUTOLINE INDUSTRIES LIMITED on the Accounts for the Year Ended on 31st March, 2012]

1) In respect of Fixed Assets

a) The Company has generally maintained proper records showing particulars including quantitative details and situation of Fixed Assets on the basis of information available.

b) According to the information and explanation given to us, the fixed assets are physically verified by the management according to the phased programme which in our opinion is reasonable having regard to the size of the company and the nature of its assets. On physical verification by the management no major discrepancies between the book record and physical inventory have been noticed.

c) In our opinion, the company has not disposed off a substantial part of its Fixed Assets and the going concern status is not affected.

2) In respect of its Inventories: (Excluding material in transit).

a) The inventory of the Company has been physically verified by the Management during the year at regular interval. 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 as explained to us and which are followed by the Management for physical verification of inventory are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) According to the information and explanations given to us no material discrepancies were noticed on physical verification of stocks as compared to book records, discrepancies noticed were properly dealt with, in the books of accounts, which were not material considering the size of the Company's operation.

3) a) As per the information and explanation given to us, the company has granted unsecured loan to companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. The year end balance is Rs.11,06,00,780/- and has been given to two parties.

b) In our opinion, and according to the information and explanations given to us, rate of interest in case of one subsidiary company and interest free loan to wholly own foreign subsidiary company and other terms and conditions of loan given by the company, secured or unsecured, to the parties listed in the register maintained under Section 301 of the Companies Act, 1956 are not prima facie, prejudicial to the interest of the Company.

c) There is no prescribed stipulation of repayment of principal & interest.

d) In respect of loan granted by company, the same are repayable on demand and therefore question of overdue amount does not arise.

e) As per the information and explanation given to us, the company has taken unsecured loan, from wholly owned subsidiary covered in the Register maintained under Section 301 of the Companies Act 1956. The year end balance is Rs. 80,18,055/- and is from one party.

f) The advance accepted by the company is from wholly owned subsidiary company and as such the terms and conditions of this advance are not prejudicial to the interest of the company.

g) There is no prescribed stipulation of repayment of principal & interest.

4) In our opinion and according to the information and explanations given to us, having regard to the explanation that certain items purchased/ services availed are of special nature for which suitable alternative sources do not exist for obtaining comparative quotations, there are adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, no major weakness has been noticed in the internal controls system.

5) In respect of transaction covered under section 301 of the Companies Act 1956 :

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

b) In our opinion and according to the information and explanations given to us, the transaction made in pursuance of such contracts or arrangements during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) The company has not accepted any deposits under the provisions of sections 58A and 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 1975 framed thereunder.

7) The Company has an internal audit system comprising of its own internal management audit team, and also a firm of chartered accountants appointed as internal auditor by the management and in our opinion, company's present internal audit system is commensurate with the size of the company and the nature of its business.

8) We have broadly reviewed the books of account maintained by the company in respect of products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of subsection (1) of section 209 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. The same are verified by external cost auditor appointed by company for carrying cost audit and has expressed their satisfaction for the cost record. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9) a) According to the information and explanations given to us and according to the books and records as produced and examined by us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, E.S.I., Income Tax, Sales Tax (VAT), Wealth Tax, Service Tax, Excise Duty, Customs Duty, Cess and any other material statutory dues, to the extent applicable, have been generally regularly deposited with the appropriate authorities. According to the information and explanations given, except for Income Tax, VAT and TDS liability which is paid before the signing of report, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2012, for a period of more than six months from the date they became payable.

b) As at 31st March 2012, according to the records of the Company and on the basis of information and explanations given to us, except for Income Tax & Sales Tax (VAT), there are no disputed dues in respect of Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess.

The disputed amount is in respect of liability under Income Tax Act, 1961 for Asst. Year 2008-09 relevant to Financial Year 2007-08 is aggregating to Rs. 2,92,96,660/- , which has not been deposited as at 31st March. 2012. The appeal in respect of same is pending with The Commissioner of Income Tax (Appeals) Pune.

The disputed amount is in respect of liability under The Maharashtra Value Added Tax Act, 2002/ The Central Sales Tax Act, 1956 for Financial Year 2000-01 is aggregating to Rs.1,10,00,000/- and for Financial Year 2001- 02 is aggregating to Rs.1,25,00,000/- , which has not been deposited as at 31st March, 2012. The appeal in respect of same is pending with The Joint Commissioner of Sales Tax (Appeals) Pune.

10) The company has no accumulated losses as at March 31, 2012, and has not incurred any cash losses during the financial year ended on that date and in the immediately preceding financial year.

11) Based on our audit procedures and on the information and explanations given by the Management, in our opinion, the Company has not defaulted in repayment of its dues to any financial institution or bank or Debenture holder as at the balance sheet date.

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

13) In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute and provisions applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14) In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in securities.

15) In our opinion, and according to the information and explanations given to us, the Company has given corporate guarantee for the loans taken by a subsidiary company from banks or financial institutions. In our opinion the terms and conditions thereof are not prejudicial to the interest of the company.

16) According to the information and explanation given to us, company has raised term loan during the year. On the basis of the information and explanation given to us and on an overall examination of the financial statements of the company, we are of the opinion that, prima facie the term loan is applied for the purposes for which they were obtained.

17) According to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short term basis have been used for long term purposes.

18) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

19) No debentures have been issued during the year.

20) During the year the Company has not raised money by public issue.

21) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

FOR GUJAR RAWAT SHETH & ASSOCIATES.

CHARTERED ACCOUNTANTS.

FIRM REGISTRATION NO: 121347W

PLACE : PUNE. (VIJAY B SHETH)

DATE : 28TH APRIL, 2012 PARTNER.

MEM. NO. 037634


Mar 31, 2010

We have audited the attached BALANCE SHEET of AUTOLINE INDUSTRIES LIMITED as at 31st March 2010, the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

1. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards required 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 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 presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by the Companies (Auditors Report) Order, 2003 and the Companies (Auditors Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of section 227 (4A) of Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to information and explanation given to us, we enclose in the annexure hereto a statement on the matters specified in paragraph 4 & 5 of the said order to the extent applicable to company.

3. Further to our comments in the Annexure referred to in paragraph 2 above we Report that:

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

b) 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 the books of accounts.

c) The Balance Sheet and Profit & Loss Account dealt with by this report are in agreement with the Books of Accounts.

d) We draw attention to -

(i) note no. 3(1) ) in Schedule “24” regarding non provision for the expired export obligation.

(ii) note no.10 in Schedule “24” regarding non provision for diminishing in value of investment in subsidiary Koderat Investments Ltd. (Cyprus). The note is self explanatory. In the given circumstances we are unable to give our opinion.

e) In our opinion and subject to Note to Accounts Schedule “24”, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the requirement of the Accounting Standard referred to in sub section (3C) of section 211 of Companies Act, 1956,.

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

g) In our opinion and to the best of our information and according to the explanations given to us the said accounts read together with Significant Accounting Policies, and Notes to Accounts in Schedule “24” and subject to our observations in 3(d) above 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 case of the Balance Sheet, of the state of affairs of the Company as on 31st March, 2010.

ii) In the case of the Profit & Loss Account of the Profit for the year ended on that date.

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

ANNEXURE TO AUDITORS REPORT [Annexure Referred to in paragraph 2 of the Auditors Report of even date to the members of AUTOLINE INDUSTRIES LIMITED on the Accounts for the Year Ended on 31st March, 2010]

1) In respect of Fixed Assets

a) The Company has generally maintained proper records showing particulars including quantitative details and situation of Fixed Assets on the basis of information available.

b) According to the information and explanation given to us, the fixed assets are physically verified by the management according to the phased programme which in our opinion is reasonable having regard to the size of the company and the nature of its assets. On physical verification by the management no major discrepancies between the book record and physical inventory have been noticed.

c) In our opinion, the company has not disposed off a substantial part of its Fixed Assets and the going concern status is not affected.

2) In respect of its Inventories :

a) The inventory of the Company has been physically verified by the Management during the year. 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 as explained to us and which are followed by the Management for physical verification of inventory are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) According to the information and explanations given to us no material discrepancies were noticed on physical verification of stocks as compared to book records, minor discrepancies noticed were properly dealt with, in the books of accounts, which were not material considering the size of the Companys operation.

3) a) As per the information and explanation given to us, the company has granted unsecured loan to companies,

firms or other parties covered in the Register maintained under Section 301 of the Companies Act 1956. The year end balance is 15,65,78,840/- and has been given to three parties.

b) The advance given by the Company is to subsidiaries and it is interest free. The terms and conditions on which this advance given is not prejudicial to the interest of the Company.

c&d) There is no prescribed stipulation of repayment of the Advance and is payable on demand and therefore question of overdue amount does not arise.

e) As per the information and explanation given to us, the company has taken loans, secured or unsecured, from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act 1956. The year end balance is Rs. 17,47,25,978/- and is from two parties.

f) The advance accepted by the company is from subsidiary company and as such the terms and conditions of this advance is not prejudicial to the interest of the company.

g) There is no prescribed stipulation of repayment of the Advance and is payable on demand.

4) In our opinion and according to the information and explanations given to us, having regard to the explanation that certain items purchased/ services availed are of special nature for which suitable alternative sources do not exist for obtaining comparative quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, no major weakness has been noticed in the internal controls.

5) In respect of transaction covered under section 301 of the Companies Act 1956 :

a) Based on the audit procedures applied by us and according to the information and explanations provided by the Management we are of the opinion that the transactions that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, and excluding certain transactions of purchase of goods/ services availed and material of special nature for which alternative quotations are not available, where each of such transaction is in excess of five lakh rupees in respect of any party, transactions have been made at prices which are prima facie reasonable having regard to prevailing market prices at the relevant time.

6) According to information and explanation given to us, the Company has not accepted any deposits during the year from public within the meaning of the provisions of Sections 58A and 58AA of the Companies Act 1956 and the rules framed there under. Hence clause 4 (VI) of the order is not applicable.

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

8) The Central Government of India, under clause (d) of sub section (1) of section 209 of the companies Act, 1956 has prescribed the maintenance of cost records. As informed by the management the prescribed accounts and records have been made and maintained. We have, however, not made the examination of the records with a view to determine whether they are accurate or complete.

9) a) According to the information and explanations given to us and according to the books and records as

produced and examined by us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, E.S.I., Income Tax, Sales Tax (VAT), Wealth Tax, Service Tax, Excise Duty, Customs Duty, Cess and any other material statutory dues, to the extent applicable, have been generally regularly deposited with the appropriate authorities. According to the information and explanations given, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2010, for a period of more than six months from the date they became payable.

b) As at 31st March 2010, according to the records of the Company and on the basis of information and explanations given to us, there are no disputed dues in respect of Sales Tax (VAT), Income Tax, Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess.

10) The company has no accumulated losses as at March 31, 2010, and has not incurred any cash losses during the financial year ended on that date and in the immediately preceding financial year.

11) Based on our audit procedures and on the information and explanations given by the Management, in our opinion, the Company has not defaulted in repayment of its dues to any financial institution or bank or Debenture holder as at the balance sheet date.

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

13) In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute and provisions applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14) In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in securities.

15) In our opinion, and according to the information and explanations given to us, the Company has given corporate guarantee for the loans taken by a subsidiary company from banks or financial institutions. In our opinion the terms and conditions thereof are not prejudicial to the interest of the company.

16) According to the information and explanation given to us, company has raised term loan during the year. On the basis of the information and explanation given to us and on an overall examination of the financial statements of the company, we are of the opinion that, prima facie the term loan is applied for the purposes for which they were obtained.

17) According to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short term basis have been used for long term purposes.

18) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

19) No debentures have been issued during the year.

20) During the year the Company has not raised money by public issue.

21) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

FOR GUJAR RAWAT SHETH & ASSOCIATES. CHARTERED ACCOUNTANTS FIRM REGISTRATIOIN NO. : 121347W

(MOHAN R. GUJAR) PLACE : Pune PARTNER DATE : 29th May, 2010 MEMBERSHIP NO. 030305


Mar 31, 2004

We have audited the attached BALANCE SHEET of AUTOLINE STAMPINGS PRIVATE LIMITED, as at 31st March 2004 and the Profit & Loss Account 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.

1. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards required 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 the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by the Companies (Auditors Report) Order issued by the department of companies affairs in terms of section 227 (4A) of companies Act, 1956 and on the basis of such checks as we considered appropriate and according to information and explanation given to us we enclose in the annexure hereto a statement on the matters specified in paragraph 4 & 5 of the said order to the extent applicable to company.

3. Further to our comments in the Annexure referred to in paragraph 2 above

We report that :

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

b) 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 the books of accounts.

c) The Balance Sheet and Profit & Loss Account dealt with by this report are in agreement with the Books of Accounts.

d) In our opinion , the Balance Sheet and Profit and Loss Accounts dealt with by this report comply with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956, to the extent applicable.

e) On the basis of the written representation received from the Directors as on 31st March 2004 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March 2004 for being appointed as a Director of the Company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act 1956.

f) The Company has not provided for the benefits of the employees like Gratuity, leave encashment. It is not possible for us to estimate the liabilities on these accounts since no actuarial valuation has been made for the same. Therefore, the profit for the year has been shown in excess to that extent.

g) Subject to our comments in Para ( 3.f ) above, in our opinion and to the best of our information and according to the explanations given to us the said accounts read together with Significant Accounting Policies, and Notes thereon gives 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 case of the Balance Sheet, of the state of affairs of the Company as on 31st March, 2004.

ii) In the case of the Profit & Loss Account of the Profit the year ended on 31st March, 2004.

[ Annexure Referred to in paragraph 2 of the Auditors Report of even date to the members of AUTOLINE STAMPINGS PRIVATE LIMITED on the Accounts for the Year Ended on 31st March, 2004 ]

1) In respect of Fixed Assets

a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets on the basis of information available.

b) According to the information and explanation given to us, all the major Assets have been physically verified by the Management during the year. We have been informed that no material discrepancies were noticed on such verification. In our opinion, method adopted by the Management for physical verification is reasonable.

c) In our opinion, during the year the company has not disposed off a substantial part of its Fixed Assets and the going concern status is not affected.

2) In respect of its Inventories :

a) The inventory of the Company has been physically verified by the Management during the year.

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

c) According to the information and explanations given to us no material discrepancies were noticed on physical verification of stocks as compared to book records. Minor discrepancies noticed were properly dealt with, in the books of accounts, which were not material considering the size of the Companys operation.

3) As per the information and explanation given to us, the company has not granted or taken any loans, secured or unsecured, to/ from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act 1956. Hence reporting under clause 4 sub clause iii (b), iii (c) & iii (d) of the order is not applicable to the Company.

4) There are adequate internal control procedures commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods. As per the information and explanation given to us, in our opinion there is no continuing failure to correct major weaknesses in internal control.

5) In respect of transaction covered under section 301 of the Companies Act 1956 :

a) Based on the audit procedures applied by us and according to the information and explanations provided by the Management we are of the opinion that the transactions that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act 1956, and exceeding the value of Rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to the market prices prevailing at the relevant time.

6) According to information and explanation given to us, the Company has not accepted any deposits during the year from public within the meaning of the provisions of Sections 58A and 58AA of the Companies Act 1956 and the rules framed there under. Hence clause 4 (vi) of the order is not applicable.

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

8) Maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of section 209 of the companies Act, 1956. Hence clause 4 (viii) of the order is not applicable.

9) a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, the undisputed statutory dues in respect of Providend Fund, Investor education and protection fund, E.S.I., Income Tax, Sales Tax, Excise Duty, Customs Duty, cess and other material statutory dues as applicable have been regularly deposited by the Company during the year with the appropriate authorities.

b) As at 31st March 2004, according to the records of the Company and the information and explanations given to us, there are no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty and Cess.

10. The company has neither accumulated losses as at March 31, 2004, nor it has incurred any cash losses during the financial year ended on that date or in the immediately preceding financial year.

11. Based on our audit procedures and on the information and explanations given by the Management, in our opinion, the Company, has not defaulted in repayment of its dues to any financial institution or bank or Debenture holder as at the balance sheet date.

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

13. In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute and provisions applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14. In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in securities.

15. In our opinion, and according to the explanations given to us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

15. In our opinion, and according to the explanations given to us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

16. According to the information and explanation given to us, the term loans raised during the year have been applied for the purpose for which they were raised.

17. According to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investment and vice versa.

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

19. No debentures have been issued during the year.

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

21. During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

FOR GUJAR RAWAT SHETH & ASSOCIATES. CHARTERED ACCOUNTANTS.

( MOHAN R. GUJAR ) PARTNER. M. No. 30305

PLACE : PUNE.

DATE : June 30, 2004.

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