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Auditor Report of Brahmaputra Infrastructure Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of BRAHMAPUTRA INFRASTRUCTURE LIMITED ("the Com- pany"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other disclosures.

Management's Responsibility for the Financial Statements

The Company Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 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 judgements and estimates that are rea- sonable and prudent; and design, implementation and maintenance of internal financial controls, that were operating effec- tively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standard 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 state- ments. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material mis- statement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor consid- ers 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, 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 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 financial statements.

Opinion

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

Emphasis of Matters

We draw attention to the Note No.13.1 to the Financial Statements which describes about " No Provision made for slow Moving "WIP" amounting to Rs.62.30 Crore.

Our Opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the Annexure 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 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 aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Company (Accounts) Rules, 2014.

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.

f. With respect to 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 explana- tions given to us:

(i) The financial statement disclose the impact of pending litigation on the financial position of the company - refer para 1(c) to 1 (i) and 2(b) of Note 26(C).

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

(iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE TO THE AUDITORS' REPORT OF EVEN DATE Re: BRAHMAPUTRA INFRASTRUCTURE LIMITED

I. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets, However due to frequent movement of fixed assets - movable construction equipments from site to site, actual location of such assets has not been mentioned in the records. Significant Portion of Fixed Assets have been physically verified by the management during the period ,which in our opinion is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such physical verification.

II. As per information and explanations given to us, the inventories and construction materials at company's sites which include work in progress, have been physically verified by the management once in a year for each site. Shortage / Excess on the basis of physical verification have been duly accounted for in books of accounts which were not mate- rial, However no provision is being made for slow moving work in progress. In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the manage- ment is reasonable and adequate in relation to size of the Company and the nature of its business. The Company is mainly engaged in business of construction. In view of multifarious jobs at different sites spread at different locations and practical difficulties, records of inventory have been maintained in ERP System and consumption booked on quarterly basis.

III. (a) According to the information & explanation given to us, the company has granted interest free unsecured loans to Four Companies (All Subsidiaries) and also to one Associate Company covered in the registered maintained u/s 189 of the Companies Act .The maximum amount involved during the year was Rs 1938.25 Lacs in respect of subsidiaries and Rs 10 lacs in respect of associate company and year end balance of the loans granted to subsidiaries were Rs. 1927.17 Lacs and to Associate was NIL .

(b) The parties wherever applicable are regular in repayment of principal amounts and interest as stipulated.

(c) Not Applicable as there is no overdue amount.

IV. 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 inven- tories and Fixed Assets and for construction receipt and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

V. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits hence provisions of sections 73 to 76 or any other provision of the Companies Act and rules framed thereun- der, , are not applicable.

VI. The Maintenance of Cost Records has been prescribed by the Central Govt. under section 148(1) of the Companies Act, 2013 vide Companies (Cost Records and Audit) Rules , 2014 and we are of the opinion that prima facie the prescribed records were made and maintained.

VII. (a) In the Year under report, The company is not regular in depositing with appropriate authorities undisputed statu- tory dues such as Service tax, TDS, Sales Tax and PF etc. dues wherever applicable on it.

According to the information and explanations given to us, the detail of undisputed amounts payable in respect of Service Tax , sales tax, TDS etc. in arrears, as at 31st March, 2015 for a period of more than six months from the date of they became payable is as under;

Nature of Amount Amount Outstanding as on 31st March, 2015 for More than 6 Months from the date become payable

Service Tax Rs. 329.01 Lacs

TDS Rs. 96.18 Lacs

Interest on TDS Payable Rs. 119.69 Lacs

Interest on Service Tax Payable Rs. 17.34 Lacs

Vat / Entry Tax / WCT Rs. 179.32 Lacs

Provident Fund and Prof. Tax Rs. 2.06 Lacs

(b) According to the information and explanation given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess which have not been deposited on account of any dispute except in respect of the following disputed liabilities pending for adjudication at different appellate authorities ;

Name of the Nature of the dues statute

Assam Vat Act Vat Liability for Spanish Garden Project

UP Vat Act Vat Liability for Lucknow Project/Penalty for Non Submission of C Form

Service Tax Service tax Demand including penalty raised by Service tax Department

Income Tax Demand including interest u/s 153A/143(3), raised by Income Tax Department

Income Tax Penalty for late filing of TDS returns

Income Tax Demand for Penalty

Name of the Amount statute (Rs in Lacs)

Assam Vat Act 47.87

UP Vat Act 269.31

Service Tax 1661.66

Income Tax 515.83

Income Tax 3.50

Income Tax 0.70

(c) According to the information and explanation given to us, No amount is required to be transferred to investor education and protection fund in accordance with the relevant provision of the Companies Act, 1956 (1 of 1956) and rules made there under.

VIII. In our opinion, the company has no accumulated losses at the end of the year. The company has incurred cash losses during the financial year of Rs 1555.15 Lacs covered by our audit and also Rs 358.02 Lacs in the immediately preced- ing financial year.

IX. As per Books and Records maintained by the company and according to the information and explanations given to us, the company has defaulted in repayment of dues to a financial institution and banks. Such continuing default as on balance sheet date were of Rs. 1351.48 Lacs as reported in note no. 3.2 to financial statements.

X. According to the information and explanations given to us, the Company has given bank guarantees for and on behalf of its Joint Ventures. Considering the nature and volume of business, in our opinion the term and conditions on which such guarantees given are prima-facie not prejudicial to the interest of the Company.

XI. Under implementation of "Restructuring Approval under CDR System" Some portion of borrowings from banks includ- ing BG invocation got converted into "Term Loans" under name & style as "Working Capital Term Loan / Funded Interest Term Loan.

XII. In our opinion and according to the information and explanations given to us by the management which have been relied upon by us, no fraud on or by the company has been noticed or reported during the year.

For A.B Bansal and Company Chartered Accountants Firm Regn No. 010538N

A.B. Bansal Place: New Delhi Partner Dated: 30.05.2015 M.No. 84628


Mar 31, 2014

1. We have audited the accompanying financial statements of BRAHMAPUTRA INFRASTRUCTURE LIMITED, which comprises the Balance Sheet as at 31st March 2014 and the Statement of Profit & Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other disclosures.

Management''s Responsibility for the Financial Statements

2. 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 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

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

4. 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 evaluation of 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.

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

Opinion

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

(a) in the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2014;

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

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

Report on Other Legal and Regulatory Requirements

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

8. 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 sub-section (3C) of section 211 of the Companies Act, 1956;

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 are 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;

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 THE AUDITORS'' REPORT

(Referred to in Paragraph 7 of our Report of even date)

1 (a) The Company has maintained proper records of fixed assets showing full particulars including quantitative details and situation of fixed assets. However, due to frequent movement of fixed assets - movable construction equipments from site to site, actual location of such assets has not been mentioned in the records. Significant portion of fixed assets have been physically verified by the management during the period, which in our opinion is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such physical verification.

(b) There was no substantial disposal of fixed assets during the year under audit.

2 As per information and explanations given to us, the inventories and construction materials at Company''s sites which include work in progress, have been physically verified by the management once in a year for each site. Shortage / Excess on the basis of physical verification have been duly accounted for in books of accounts which were not material. However no provision is being made for slow moving work in progress. In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to size of the Company and the nature of its business. The Company is mainly engaged in business of construction. In view of multifarious jobs at different sites spread at different locations and practical difficulties, records of inventory have been maintained in ERP System and consumption booked on quarterly basis.

3 (a) According to the information & explanation given to us, the company has granted interest free unsecured loans to Five Companies (All Subsidiaries) and also granted interest bearing Unsecured Loan to One Associate Company covered in the register maintained u/s 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs 1921.31 Lacs in respect of subsidiaries and Rs 303.50 lacs in respect of associate company and year end balance of the loans granted to subsidiaries were Rs. 1921.31 Lacs and to Associate was NIL.

(b) We are of the opinion that other terms and conditions of the loan given by the Company are prima facie not prejudicial to the interest of the Company.

(c) The parties wherever applicable are regular in repayment of principal amounts and interest as stipulated.

(d) Not Applicable as there is no overdue amount.

(e) According to the information and explanation given to us, the Company has taken unsecured loans from three Companies (Associate) covered in the register maintained u/s 301 of the Companies Act, 1956. The maximum amount outstanding during the year was Rs. 504.71 Lacs and year end balance was Rs. 56.07 Lacs.

(f) We are of the opinion that the rate of interest and other terms and conditions of the loan taken by the Company are prima facie not prejudicial to the interest of the Company.

(g) The Company is regular in repayment of principal amount & Interest wherever applicable.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the construction receipt and services. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. (a) Based on the audit procedure applied by us and according to the information and explanation provided by the management, we are of the opinion that the particulars of contracts and/or arrangements referred to in section that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangement 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 prevailing market prices at the relevant time.

6. As per the information and explanations given to us, the company has not accepted any deposits from the public.

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

8. The Maintenance of Cost Records has been prescribed by the Central Govt. under section 209(1) of the Companies Act, 1956 vide Companies (Cost Accounting Records) Rules, 2011 and we are of the opinion that prima facie the prescribed records were made and maintained.

9. (a) Except TDS, Service Tax and Provident Fund, the Company is generally regular in depositing undisputed statutory dues including Investor Education Protection fund, Employees'' State Insurance, Income tax, Sales- tax, Customs Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities. The Detail of Statutory Dues as on 31.03.14, which is due for a period of more than 6 months from the date they become payable is as under:

Nature of Amount Amount Outstanding as on 31st March, 2014 for More than 6 Months from the date become payable

Service Tax Rs.242.96 Lacs TDS Rs.38.73 Lacs

Interest on TDS Payable Rs.65.52 Lacs

Interest on Service Tax Payable Rs.12.47 Lacs

Vat / Entry Tax / WCT Rs.88.24 Lacs

Provident Fund Rs.1.13 Lacs

(b) According to the information and explanation given to us there are no such statutory dues of income tax, custom duty, wealth tax, service tax, excise duty, cess, ESI, PF, entry tax and Sales Tax which have not been deposited on account of any dispute except in respect of the following disputed liabilities at different appellate authorities:

Name of the statute Nature of the dues Amount (Rs in Lacs) Assam Vat Act Vat Liability for Spanish Garden Project 47.87

UP Vat Act Vat Liability for Lucknow Project 54.25

Service Tax Service tax Demand including penalty raised by Service tax Department 1661.66

Income Tax Demand including interest u/s 153A/143(3),raised by Income Tax Department 515.83

Income Tax Penalty for late filing of TDS returns 3.50

Income Tax Demand for Penalty 0.70

10. The Company has no accumulated losses for the year ended 31st March, 2014 and it has suffered cash loss of Rs 358.02 Lacs during the year and has earned profits in the immediately preceding financial year.

11. As per books and records maintained by the Company and according to the information and explanation given to us, the Company has defaulted in repayment of term dues to financial institutions and Banks. Such continuing default as on balance sheet date were of Rs. 679.75 Lacs as reported in note no. 3.2 to financial statements.

12. In our opinion and according to the information and explanation given to us, no Loans and Advances have been granted by the Company on the basis of security by way of shares, debentures and other securities .

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

14. The Company does not deal in shares, securities debentures and other investment. However, the Company is hold- ing investments in shares of its subsidiaries/Associates and the Company has maintained proper records of transac- tions in respect of Such Investment.

15. According to the information and explanations given to us, the Company has given bank guarantees for and on behalf of its Joint Ventures. Considering the nature and volume of business, in our opinion the term and conditions on which such guarantees given are prima-facie not prejudicial to the interest of the Company.

16. The Company has raised term loans during the year and the same were applied for the purpose for which the loans were obtained.

17. According to the information and explanation 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.

18. During the year covered under our audit, Company has not made / proposed any preferential Allotment of shares to parties covered in the register maintained under section 301 of the Companies Act, 1956.

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

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

21. In our opinion and according to the information and explanations given to us by the management which have been relied upon by us, no fraud on or by the Company has been noticed or reported during the year.

For A.B Bansal and Company

Chartered Accountants Firm Regn No. 010538N

A.B. Bansal Place : New Delhi Partner Dated : 30.05.2014 M.No. 84628


Mar 31, 2013

1. We have audited the accompanying merged financial statements of BRAHMAPUTRA INFRASTRUCTURE LIMITED ("the transferee Company") and BRAHMAPUTRA INFRAPROJECT LIMITED ("the transferor company"), which comprises the Balance Sheet as at 31st March 2013 and the Statement of Profit & Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other Disclosures.

Management''s Responsibility for the Financial Statements

2. 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 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

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

4. 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 evaluation of 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.

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

Opinion

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

a) in the case of Balance Sheet, of the state of affairs of the company as at 31st March, 2013;

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

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

Report on Other Legal and Regulatory Requirements

7. As required by the companies (Auditor''s Report) Order, 2003 (" the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

8. 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 sub-section (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 are 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 THE AUDITORS'' REPORT

(Referred to in Paragraph 7 of our Report of even date)

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

details and situation of fixed assets. However due to frequent movement of fixed assets - movable construction equipments from site to site, actual location of such assets has not been mentioned in the records. Significant Portion of Fixed Assets have been physically verified by the management during the period, which in our opinion is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such physical verification. (b) There was no substantial disposal of fixed assets during the year under audit.

2. As per information and explanations given to us, the inventories and construction materials at company''s sites which include work in progress, have been physically verified by the management at reasonable intervals during the year. In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to size of the Company and the nature of its business. The Company is mainly engaged in business of construction. In view of multifarious jobs at different sites spread at different locations and practical difficulties, records of inventory have been maintained in ERP System and consumption booked on closing of accounts.

3. (a) According to the information & explanation given to us, the company has granted interest free unsecured loans to Five Companies (All Subsidiaries) covered in the register maintained u/s 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs 1685.02 Lacs and yearend balance of the loans granted to such companies were Rs. 1685.02 Lacs.

(b) We are of the opinion that other terms and conditions of the loan given by the Company are prima facie not prejudicial to the interest of the Company.

(c) The parties wherever applicable are regular in repayment of principal amounts and interest as stipulated.

(d) Not Applicable as there is no overdue amount.

(e) According to the information and explanation given to us the company has taken unsecured loans from two companies (Associate) covered in the register maintained u/s 301 of the Companies Act, 1956. The maximum amount outstanding during the year was Rs. 712.25 Lacs and yearend balance was Rs. 117.75 Lacs.

(f) We are of the opinion that the rate of interest and other terms and conditions of the loan taken by the Company are prima facie not prejudicial to the interest of the Company.

(g) The Company is regular in repayment of principal amount & Interest wherever applicable.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the construction receipt and services. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. (a) Based on the audit procedure applied by us and according to the information and explanation provided by the management, we are of the opinion that the particulars of contracts and/or arrangements referred to in section that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangement 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 prevailing market prices at the relevant time.

6. As per the information and explanations given to us, the company has not accepted any deposits from the public.

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

8. The Maintenance of Cost Records has been prescribed by the Central Govt. under section 209(1) of the Companies Act, 1956 vide Companies (Cost Accounting Records) Rules, 2011 and we are of the opinion that prima facie the prescribed records were made and maintained.

9. (a) Except TDS, Service Tax and Wealth Tax, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income tax, Sales- tax, Customs Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities. The Detail of Statutory Dues as on 31.03.13, which is due for a period of more than 6 months from the date they become payable is as under:

Nature of Amount Amount Outstanding as on 31st March, 2013 for More than 6 Months from the date become payable

Service Tax Rs. 174.37 Lacs

Wealth Tax Rs. 0.99 Lacs

TDS Rs. 120.75 Lacs

Interest on TDS and Service Tax Rs. 44.24 Lacs

Vat / Entry Tax / WCT Rs. 37.15 Lacs

(b) According to the information and explanation given to us there are no such statutory dues of income tax, custom duty, wealth tax, service tax, excise duty, cess, ESI, PF, entry tax and Sales Tax which have not been deposited on account of any dispute except in respect of the following disputed liabilities at different appellate authorities:

Name of the statute Nature of the dues Amount (Rs in Lacs)

Assam Vat Act Vat Liability for Spanish Garden Project 47.87

Service Tax Service tax Demand raised by Service 1753.90 tax Department

Income Tax Demand including interest u/s 153A/143(3), 515.83 raised by Income Tax Department

10. The Company has no accumulated losses for the year ended 31st March, 2013 and it has not incurred any cash losses during the said year covered by our audit or in the immediately preceding financial year.

11. As per books and records maintained by the Company and according to the information and explanation given to us, the Company has defaulted in repayment of dues to financial institutions and Banks. Such continuing default as on balance sheet date are reported in note no. 3.2 to financial statements.

12. In our opinion and according to the information and explanation given to us, no Loans and Advances have been granted by the Company on the basis of security by way of shares, debentures and other securities.

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

14. The company does not deal in shares, securities debentures and other investment. However the company is holding investments in shares of its subsidiaries/Associates and the Company has maintained proper records of transactions in respect of Such Investment.

15. According to the information and explanations given to us, the Company has given bank guarantees for and on behalf of its Joint Ventures and Associate. Considering the nature and volume of business, in our opinion the term and conditions on which such guarantees given are prima-facie not prejudicial to the interest of the Company.

16. The Company has raised term loans during the year and the same were applied for the purpose for which the loans were obtained.

17. According to the information and explanation 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.

18. Besides the Shares issued vide scheme of amalgamation approved by Hon''ble High Court Order dated 4th January, 2013, during the year covered under our audit, Company has not made / proposed any preferential Allotment of shares to parties covered in the register maintained under section 301 of the Companies Act, 1956.

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

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

21. In our opinion and according to the information and explanations given to us by the management which have been relied upon by us, no fraud on or by the Company has been noticed or reported during the period.

For A.B Bansal and Company

Chartered Accountants

Firm Regn No. 010538N



A.B. Bansal

Place : New Delhi Partner

Dated : 02.09.2013 M.No. 84628

 
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