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Auditor Report of Dish TV India Ltd.

Mar 31, 2016

1. We have audited the accompanying standalone financial statements of Dish TV India Limited ("the Company"), which comprise the Balance Sheet as at 31 March 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

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

Auditor''s Responsibility

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

4. 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.

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

6. An audit involves performing procedures to obtain audit evidence about the amounts and the 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 controls 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 the 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.

7. 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

8. 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 31 March 2016, its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.

10. Further to our comments in Annexure I, 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 it appears from our examination of those books;

c. the standalone financial statements 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 (as amended);

e. on the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2016 from being appointed as a director in terms of Section 164(2) of the Act;

f. we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as of 31 March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date and our report dated 23 March 2016 as per Annexure II expressed unqualified opinion;

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. as detailed in note 39 and 46 to the standalone financial statements, the Company has disclosed the impact of pending litigations on its standalone financial position;

ii. the Company did not have any long-term contract 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.

Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that:

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

(b) The fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification. In our opinion, the frequency of verification of the fixed assets is reasonable having regard to the size of the Company and the nature of its assets.

(c) The Company does not hold any immovable property (in the nature of ''fixed assets''). Accordingly, the provisions of clause 3(i)(c) of the Order are not applicable.

(ii) The Company does not have any inventory. Accordingly, the provisions of clause 3(ii) of the Order are not applicable.

(iii) The Company has not granted any loan, secured or unsecured to companies, firms, Limited Liability Partnerships (LLPs) or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a), 3(iii) (b) and 3(iii)(c) of the Order are not applicable.

(iv) In our opinion, the Company has complied with the provisions of Sections 185 and 186 of the Act in respect of loans, investments, guarantees, and security.

(v) In our opinion, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.

(vi) The Central Government has not specified maintenance of cost records under sub-section (1) of Section 148 of the Act, in respect of Company''s products/services. Accordingly, the provisions of clause 3(vi) of the Order are not applicable.

(vii) (a) Undisputed statutory dues including provident fund, employees''state insurance, income- tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited to the appropriate authorities, though there has been a slight delay in a few cases. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

(b) The dues outstanding in respect of income- tax, sales-tax, service tax, duty of customs, duty of excise and value added tax on account of any dispute, are as follows:

Name of the Nature of the dues Amount Amount Statute involved paid (Rs. in under lacs) protest (Rs. in lacs)

Income Tax Income Tax and 9 - Act, 1961 interest

225 225

320 320

263 -

93 59

16 -

57 50

65 33

Name of the Statute Period to Forum where dispute is pending which the amount relates

Income Tax Act, 1961 Assessment Income Tax-Appellate Tribunal, Year 2006-07 Mumbai

Assessment * Year 2009-10

Assessment Income Tax-Appellate Tribunal, Delhi Year 2010-11

Assessment Commissioner of Income Tax- Appeals, Year 2004-05 Mumbai

Assessment Income Tax-Appellate Tribunal, Delhi Year 2011-12

Assessment Income Tax-Appellate Tribunal, Delhi Year 2011-12

Assessment Commissioner of Income Tax- Appeals, Year 2012-13 Noida

Assessment Commissioner of Income Tax- Appeals, Year 2013-14 Noida

Name of the Nature of the dues Amount Amount Statute involved paid (Rs. in under lacs) protest (Rs. in lacs)

Finance Act, Service Tax 167 - 1994 (Service Tax)

2,921 -

2,633 -

1,475 500

Delhi Value Value Added Tax 7 7 Added Tax Act, 2005

Value Added Tax 283 20 (including penalty and interest)

Value Added Tax 169 - (including penalty and interest)

Value Added Tax 632 - (including penalty and interest)

Value Added Tax 117 - (including penalty and interest)

Value Added Tax 2,169 - (including penalty and interest)

Andhra Value Added Tax 286 286 Pradesh Value (including penalty Added Tax Act, and interest) 2005

Bihar Value Value Added Tax 15 15 Added Tax Act,

Value Added Tax 59 44 2005 (including interest)

Value Added Tax 270 270

Value Added Tax 6 6

Haryana Value Value Added Tax # # Added Tax Act- 2003

Name of the Statute Period to Forum where dispute is pending which the amount relates

Finance Act, 1994 2006-07 to Custom Excise and Service Tax 2010-11 Appellate Tribunal, Delhi

2007-08 to Custom Excise and Service Tax 2011-12 Appellate Tribunal, Allahabad

2008-09 to Commissioner of Service Tax, Noida 2010-11

2009-10 to * 2013-14

Delhi Value Added Tax Act, 2005 March-10 Spl. Commissioner -1 (Appeal), Department of Trade & Taxes, Delhi

2007-08 DVAT Tribunal, New Delhi

2009-10 Spl. Commissioner -1 (Appeal), Department of Trade & Taxes, Delhi

2010-11 *

2011-12 *

2014-15 Spl. Commissioner - III (Appeal), Department of Trade & Taxes, Delhi

Andhra Pradesh Value Added Tax Act,2005 2006-08 State Tribunal Appellate Authority, Hyderabad

Bihar Value Added Tax Act, 2005 2007-08 Commercial Tax Officer, Patna

2008-09 Commercial Tax Officer, Patna

2012-13 Office of the Joint Commissioner of Commercial Taxes (Appeals) Patna

2014-15 Deputy Commissioner of Commercial Taxes, Patliputra Circle, Patna (Vehicle Seizure)

Haryana Value Added Tax Act-2003 December Jt. Excise & Taxation Commissioner 2012 (Appeal), Haryana

Name of the Nature of the dues Amount Amount Statute involved paid (Rs. in under lacs) protest (Rs. in lacs)

Kerala Value Value Added Tax 34 11 Added Tax Act- (including interest) 2003

Value Added Tax 1 1

Madhya Value Added Tax 5 1 Pradesh Value Added Tax 2002

UPVAT Act Value Added Tax 1 - (including interest)

Value Added Tax @ 1 (including interest) Value Added Tax $ $

116 -

7 -

3 -

181 -

Rajasthan Entry Tax 173 173 Tax of Entry on Goods in to local areas Act, 1999

The Jammu & Entry Tax 43 43 Kashmir Entry

Entry Tax 4 4 Tax on Goods, Act 2000

Indian Special Additional 795 - Customs Act, Duty 1962

Name of the Statute Period to Forum where dispute is pending which the amount relates

Kerala Value Added Tax Act-2003 2008-09 Kerala High Court

October 2013 The Intelligence inspector, Department of Commercial taxes, Thiruvananthapuram.

Madhya Pradesh Value Added Tax 2002 2013-14 Dy. Comm. Of Appeal, Div -I , Bhopal

UPVAT Act 2005-06 Joint Commissioner (Appeal), Noida

2006-07 Additional Commissioner Appeal-1, Noida

2014-15 Deputy Commissioner, Khand-3, Noida (Vehicle Seizure)

June 2015 Addl. Comm. Grade - 2 (Appeal) First, Commercial Tax, Noida

August 2015 Addl. Comm. Grade - 2 (Appeal) First, Commercial Tax, Noida

November Addl. Comm. Grade - 2 (Appeal) First, 2015 Commercial Tax, Noida 2012-13 Addl. Comm. Grade - 2 (Appeal) First, Commercial Tax, Noida

Rajasthan Tax of Entry on Goods in to local areas Act, 1999 2012-13 Supreme Court of India

The Jammu & Kashmir Entry Tax on Goods, Act 2000 2014-15 State of Jammu & Kashmir

2015-16 State of Jammu & Kashmir

Indian Customs Act 1962 April 2008 CESTAT, Delhi to June 2009

* The Company is in the process of filing the appeal with respective authority

# Rs. 40,540

@ Rs. 41,000

$ Rs. 44,900

(viii) The Company has no loans or borrowings payable to a financial institution or a bank or government and no dues payable to debenture-holders during the year. Accordingly, the provisions of clause 3(viii) of the Order are not applicable.

(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments) and did not have any term loans outstanding during the year. Accordingly, the provisions of clause 3(ix) of the Order are not applicable.

(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.

(xi) Managerial remuneration has been provided by the Company in accordance with the requisite approvals mandated by the provisions of Section 197 of the Act read with Schedule V to the Act.

(xii) In our opinion, the Company is not a Nidhi Company. Accordingly, provisions of clause 3(xii) of the Order are not applicable.

(xiii) In our opinion all transactions with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable accounting standards.

(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.

(xv) In our opinion, the Company has not entered into any non-cash transactions with the directors or persons connected with them covered under Section 192 of the Act.

(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.



For Walker Chandiok & Co LLP

(Formerly Walker, Chandiok & Co)

Chartered Accountants

Firm''s Registration No.: 001076N/N500013

per Sumit Mahajan

Place: Istanbul, Turkey Partner

Date: 23 May 2016 Membership No.: 504822


Mar 31, 2015

1. We have audited the accompanying standalone financial statements of Dish TV India Limited ("the Company"), which comprise the Balance Sheet as at 31 March 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's responsibility for the standalone Financial statements

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

Auditor's responsibility

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

4. 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.

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

6. An audit involves performing procedures to obtain audit evidence about the amounts and the 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 controls 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 the 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.

7. 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

8. 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 31 March 2015, and its profit and its cash flows for the year ended on that date.

other Matter

9. The financial statement of the Company for the year ended 31 March 2014 were audited by another auditor who expressed an unmodified opinion vide their report dated 27 May 2014. Our opinion is not modified in respect of this matter.

Report on other Legal and regulatory requirements

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

11. 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 it appears from our examination of those books;

c. the standalone financial statements 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 (as amended);

e. on the basis of the written representations received from the directors as on 31 March 2015 and taken on record by the

Board of Directors, none of the directors is disqualified as on 31 March 2015 from being appointed as a director in terms of Section 164(2) of the Act;

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. as detailed in Note 47 (a) & (e) to the standalone financial statements, the Company has disclosed the impact of pending litigations on its standalone financial position;

ii. the Company, as detailed in Note 47 (d) to the standalone financial statements, has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;

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

Annexure to the Independent Auditor'sreport of even date to the members of dish tV India Limited. on the financial statements for the year ended March 31, 2015

Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, we report that:

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

(b) As explained to us, the Company has a regular program of physical verification of its fixed assets, other than consumer premises equipment (CPE) installed at the customer premises, under which fixed assets are verified in a phased manner over a period of three years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. The existence of activated CPEs installed at the customers' premises is considered on the basis of the 'active user status' of the CPE. The CPEs lying with customers in 'inactive status' have not been physically verified and we refer to accounting policy stated in Note 2 (e) in this regard. In our opinion, the frequency of such verification of the CPEs is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verifications.

(ii) (a) The management has conducted physical verification of inventory of stock in trade consisting of CPE related accessories in the Company's possession at reasonable intervals during the year.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepancies noticed on physical verification were not material and have been properly dealt with in the books of account.

(iii) The Company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a) and 3(iii)(b) of the Order are not applicable.

(iv) According to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company's specialized requirements and similarly certain goods/ services sold are for the specialized requirements of the buyers and suitable alternatives sources are generally not available to obtain comparable prices, 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 sale of goods and services. Further, on the basis of our examination and according to the information and explanation given to us, we have neither come across nor have been informed of any major weakness in the aforesaid internal control system.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.

(vi) To the best of our knowledge and belief, the Central Government has not specified maintenance of cost records under sub-section (1) of Section 148 of the Act, in respect of Company's services. Accordingly, the provisions of clause 3(vi) of the Order are not applicable.

(vii) (a) Undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited during the year by the Company with the appropriate authorities except in respect of service tax and entertainment tax dues where there have been slight delays, the amounts have subsequently been paid to the authorities. Further, undisputed amount payable in respect of entertainment tax were outstanding at the year-end for a period of more than six months from the date they become payable.

Name of the statute Nature of the dues Amount (Rs.) Period to which the due date date of payment (in lacs) amount relates

Odisha Enter tainment Entertain ment Tax 1,009 October 2009 to Monthly basis Not yet paid Tax Rules, 2006 September 2014

(b) The dues outstanding in respect of income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess on account of any dispute, are as follows:

Name of the Nature of the dues Amount Amount paid Statute involved under protest (Rs.) (in lacs) (Rs.) (in lacs)

225 225

320 320

9 -

Income Tax Act, Income Tax, Interest 93 - 1961 and Penalty

16 -

57 -

65 -

167 -

Finance Act, 1994 Service Tax 2921 - (Service Tax) (note 1)

2633 -

1474 500

Wealth Tax Act, Wealth Tax 2 -

195 7

Value Added Tax 7 7

Value Added Tax 283 20 (including penalty and interest)

Delhi Value Added Value Added Tax 169 0 Tax Act, 2004 (including penalty and interest)

Value Added Tax 632 0 (including penalty and interest)

Andhra Pradesh Value Added Tax 286 286 Value Added Tax (including penalty and Act, 2005 interest)

15 15

59 44

38 19

23 12

Bihar Value Added Value Added Tax 13 7 Tax Act, 2005

270 270

6 6

Haryana Value Value Added Tax # # Added Tax Act-2003 (Penalty)

Value Added Tax 34 11 Kerala Value Added 1 1 Tax Act-2003

Value Added Tax 1 0 (including interest)

Value Added Tax @ 1 UP VAT Act, 2008 (including interest)

Value Added Tax $ $

Rajasthan Tax of Entry Tax 173 173 Entry on Goods in to local areas Act, 1999

The Jammu & Entry Tax 43 43 Kashmir Entry Tax on Goods, Act 2000

Indian Customs Act, Special Additional Duty 795 0 1962

Name of the Period to which the Forum where dispute is pending amount relates

Income Tax Act, 1961 Assessment Year Income Tax-Appellate Tribunal, Delhi 2009-10

Assessment Year Commissioner of Income Tax-Appeals, 2010-11 Noida

Assessment Year Income Tax-Appellate Tribunal, 2006-07 Mumbai

Assessment Year Commissioner of Income Tax-Appeals, 2011-12 Noida

Assessment Year Commissioner of Income Tax-Appeals, 2011-12 Noida

Assessment Year Commissioner of Income Tax-Appeals, 2012-13 Noida

Assessment Year Commissioner of Income Tax-Appeals, 2013-14 Noida

Finance Act, 1994 (Service Tax) 2006-07 to 2010-11 Custom Excise and Service Tax Appellate Tribunal

2007-08 to 2011-12 Custom Excise and Service Tax Appellate Tribunal, Delhi

2008-09 to 2010-11 Commissioner of Service Tax

2009-10 to 2013-14 Commissioner of Service Tax

Wealth Tax Act, 1957 2005-06 Commissioner of Wealth Tax (Appeals),Delhi

Delhi Value Added Tax Act, 2004 March 2010 Special Commissioner -1 (Appeal), Department of Trade & Taxes, Delhi

2007-08 DVAT Tribunal, New Delhi

2009-10 Special. Commissioner -1 (Appeal),

Department of Trade & Taxes, Delhi

2010-11 Special. Commissioner (Appeal),

Department of Trade & Taxes, Delhi

Andhra Pradesh Value Added Tax Act, 2005 2006-07 & 2007-08 State Tribunal Appellate Authority, Hyderabad

Bihar Value Added Tax Act, 2005 2007-08 Commercial Tax Officer, Patna 2008-09 Commercial Tax Officer, Patna

2009-10 Office of the Joint Commissioner of

Commercial Taxes (Appeals) Patna

2010-11 Office of the Joint Commissioner of

Commercial Taxes (Appeals) Patna

2011-12 Office of the Joint Commissioner of

Commercial Taxes (Appeals) Patna

2012-13 Office of the Joint Commissioner of

Commercial Taxes (Appeals) Patna

2014-15 Deputy Commissioner of Commercial Taxes, Patliputra Circle, Patna (Vehicle Seizure) Haryana Value Added Tax Act-2003 December 2012 Jt. Excise & Taxation Commissioner (Appeal), Haryana

2009-10 Kerala High Court

Kerala Value Added Tax Act-2003 October 2013 The Intelligence inspector, Department of Commercial taxes, Thiruvananthapuram.

UP VAT Act, 2008 2005-06 Joint Commissioner (Appeal), Noida

2006-07 Additional Commissioner Appeal-1, Noida

2014-15 Deputy Commissioner, Khand-3, Noida (Vehicle Seizure)

Rajasthan Tax of Entry on Goods in to local areas Act, 1999 2012-13 Supreme Court of India

The Jammu & Kashmir Entry Tax on Goods, Act 2000 2014-15 State of Jammu & Kashmir

Indian Customs Act, 1962 April 2008–June 2009 CESTAT, Delhi

# Rs. 40,540

@ Rs. 41,000

$ Rs. 44,900

Note 1 – Interest and penalty amount not ascertainable.

(c) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder. Accordingly, the provisions of clause 3(vii)(c) of the Order are not applicable.

(viii) In our opinion, the Company's accumulated losses at the end of the financial year are more than fifty percent of its net worth. The Company has not incurred cash losses during the year and in the immediately preceding financial year.

(ix) The Company has not defaulted in repayment of dues to any bank or to debenture-holders during the year.

(x) The Company has not given any guarantees for loans taken by others from banks or financial institutions. Accordingly, the provisions of clause 3(x) of the Order are not applicable.

(xi) In our opinion, the Company has applied the term loans for the purpose for which these loans were obtained.

(xii) No fraud on or by the Company has been noticed or reported during the period covered by our audit.

For Walker Chandiok & Co LLp

(Formerly Walker, Chandiok & Co)

Chartered Accountants

Firm's Registration No.: 001076N/N500013

per david Jones

Partner

Membership No.: 098113

Place : Noida

Date : May 26, 2015


Mar 31, 2014

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

2. 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 notifed under the Companies Act, 1956, read with the General Circular 15/2003 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 (together referred to as the "Act"). This responsibility includes the design, implementation and maintenance of internal controls 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.

3. Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors'' 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 controls 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 controls. 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 suffcient and appropriate to provide a basis for our audit opinion.

4. Opinion

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

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

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

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

5. Emphasis of matter

Without qualifying our opinion, attention is invited to:

a) note 2(c) of the financial statements. The Company''s net worth as at the end of the financial year is completely eroded by its accumulated losses. However, the management has prepared the financial statements assuming that the Company will continue as a going concern since it has adequate resources in the form of operating cash flows and sanctioned credit facilities from lenders to adequately meet its obligation.

b) note 50 of the financial statements regarding the life of the Consumer Premises Equipment (CPE) for the purposes of depreciation, which has been estimated by the management as five years. However, in certain cases of CPEs installed upto 31 March 2012, the one-time advance contributions towards the CPEs in

the form of rentals were recognized as revenue over a period of three years, which was not in line with the estimated life of such assets, in terms of Accounting Standard 19 ''Leases''. During the year, the Company has ascertained its impact and has streamlined the above practice by recognizing the revenue over a period of five years in respect of such CPEs installed upto 31 March 2012. This has, during the year, resulted into a reversal of excess revenue of Rs. 12,930 lacs recognized upto the year ended 31 March 2013, recognition of additional revenue of Rs. 3,702 lacs and consequential impact on license fee pursuant to the above correction, with a net impact on the loss after tax for the year ended 31 March 2014 being higher by Rs. 8,305 lacs.

c) note 51 of the financial statements regarding recognition of activation fees under the service model. Hitherto, upto the year ended 31 March 2013, the Company recognized a portion of the activation fees over the estimated period of subscription / the life of the CPE. During the year, the Company has reassessed its position of recognition of above activation fees, together with the level of service already rendered on activation, the corresponding cost incurred and separate consideration charged for the subsequent continuing services etc. Considering that the Company incurs significant upfront cost upto the stage of activation of CPE and charges separate consideration for subsequent continuing services, the Company has, in order to make better and appropriate presentation, amended its policy of revenue recognition of activation fee on an upfront basis.

The above change has resulted into additional activation / subscription revenue of Rs. 9,936 lacs for the year (including Rs. 4,614 lacs in relation to the previous year) with a corresponding increase in license fees of Rs. 994 lacs (including Rs. 461 lacs in relation to the previous year). As a consequence, the loss after tax for the year is lower by Rs. 8,942 lacs.

6. Report on Other Legal and Regulatory Requirements

(i) 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.

(ii) 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 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, 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 notifed under the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013; and

e. on the basis of written representations received from the directors as on 31 March 2014, and taken on record by the Board of Directors, none of the directors is disqualifed as on 31 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 referred to in paragraph 6 of the Independent Auditors'' Report to the Members of Dish TV India Limited on the financial statements for the year ended 31 March 2014.

(i) (a) According to the information and explanations given to us, the Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets, other than consumer premises equipment (CPE), installed at the customer premises and those in transit or lying with the distributors, have been physically verifed by the management as per a phased programme to cover over a period of three years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. Discrepancies noticed on such verifcation were not significant and have been properly dealt with in the books of account. According to the information and explanations given to us, the existence of CPEs lying at the customer premises is considered on the basis of the ''active user status'' of the CPE.

(c) Fixed assets disposed off during the year were not substantial and, therefore, do not effect the going concern assumption.

(ii) (a) According to the information and explanations given to us, physical verifcation has been conducted by the management at reasonable intervals during the year in respect of inventories of stock in trade consisting of CPE related accessories in the Company''s possession. In our opinion, the frequency of physical verifcation is reasonable.

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

(c) On the basis of our examination of the records of inventories, we are of the opinion that the Company is maintaining proper records of inventories. The discrepancies noticed on physical verifcation of inventories as compared to book records were not material and have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4(iii)(b) to (g) of the Order are not applicable.

(iv) According to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialized requirements and similarly certain goods/ services sold are for the specialized requirements of the buyers and suitable alternative sources are generally not available to obtain comparable prices, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any major weaknesses in the aforesaid internal control system.

(v) In our opinion, and according to the information and explanations given to us, there are no contracts and arrangements the particulars of which need to be entered into the register maintained under section 301 of the Companies Act, 1956.

(vi) According to the information and explanations given to us, the Company has not accepted any deposits from the public during the year within the meaning of Sections 58A and 58AA or other relevant provisions of the Companies Act, 1956 and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company in respect of the activities where, pursuant to the rules made by the Central Government, the maintenance of cost records has been prescribed under section 209(1)

(d) of the Companies Act, 1956 and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of such records with a view to determine whether they are accurate or complete.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty and other material statutory dues, as applicable, have generally been regularly deposited during the year by the Company with the appropriate authorities except in respect of entertainment tax dues where there have been several delays, though the amounts have subsequently been paid to the authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, and other material statutory dues, as applicable, were in arrears as at 31 March 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Cess and Excise duty, which have not been deposited with the appropriate authorities on account of any dispute, except as mentioned below:

(Amount in Rs. lacs)

Name of the Nature of the Amount Amount Statute dues involved* paid under protest

7 7 Delhi Value Value Added 283 20 Added Tax Tax Act, 2004 169 -

344** 18 Andhra Value Added Pradesh Value Tax Added Tax

286 286 Act, 2005

74 58

Bihar Value Value Added Added Tax Tax 344 308 Act, 2005

34 11 Kerala Value Value Added 1 1 Added Tax Act Tax 2003



Name of the Statue Period to which Forum where dispute is the amount pending relates

Delhi Value Added Tax Act, 2004 March 2010 Special Commissioner (Appeal), Department of Trade and Taxes, Delhi

April 2007 to VAT Tribunal, New Delhi March 2008

2009-10 Special Commissioner (Appeal), Department of Trade and Taxes, Delhi Andhra Pradesh Value Added Tax Act, 2005 March 2008 Andhra Pradesh High Court to September 2008

2006-08 State Tribunal Appellate Authority, Hyderabad

2007-08 Commercial Tax officer, Patna and Bihar Value Added Tax Act, 2005 2008-09 2009-10 Joint Commissioner of to Commercial Taxes (Appeal) 2012-13 Patna

Kerala Value Added Tax Act 2003 2009-10 Kerala High Court October 2013 Intelligence Inspector, Department of Commercial taxes, Thiruvananthapuram.



Name of the Nature of the Amount Amount Statute dues involved* paid under protest

1 -

# 1 UP Trade Tax Value Added 4 4 Act, 1948 Tax

51 7

Haryana VAT Value Added ## ## Act-2003 Tax

Rajasthan 173 - Tax on Entry of Goods in Entry Tax to local areas Act, 1999

MP VAT Act, Value Added ### #### 2002 Tax

225 225

320 320

Income-tax Income tax Act, 1961 and interest 9 -

93 -

Indian 795 - Additional Customs Act, Duty Special 1962

167 -

Finance 2,921 - Act,1994 Service tax (Service tax)

2,633 - Wealth Tax Wealth tax 2 - Act,1957

Name of the Statue Period to which Forum where dispute is the amount pending relates



April 2005 to Joint Commissioner (Appeal), March 2006 Noida

2006-07 Additional Commissioner Appeal, Noida

2010-11 Deputy Commissioner, Noida and UP Trade Tax Act, 1948 Mar 2013 April 2011 Additional Commissioner and Appeal, Commercial Tax, Noida 2008-09

Haryana VAT Act-2003 Dec 2012 Joint Excise and tax Commissioner (Appeal); Haryana

Rajasthan Tax on Entry of Goods in to local areas Act, 1999 2012-13 Rajasthan High Court, Jaipur and Deputy Commissioner Commercial Tax, Jaipur

MP VAT Act, 2002 2010-11 Deputy Commissioner of Commercial Tax (Appeal), Bhopal

Assessment Income Tax-Appellate Tribunal, year Delhi 2009-10 Assessment Commissioner of Income Tax- Income-tax Act, 1961 year Appeals, Noida 2010-11 Assessment Asst. Commissioner of Income year Tax-Appeal, Mumbai 2006-07 Assessment Commissioner of Income Tax- year 2011-12 Appeals, Noida

Indian Customs Act, 1962 April 2008 to Custom Excise and Service Tax June 2009 Appellate Tribunal, Delhi

2006-07 Custom Excise and Service Tax to Appellate Tribunal

2010-11

Finance Act,1994 (Service tax) 2007-08 Custom Excise and Service Tax to Appellate Tribunal, Delhi 2011-12 2008-09 Commissioner of Service tax to 2010-11

Wealth Tax Act,1957 2005-06 Commissioner of Wealth Tax (Appeals), Delhi

* Including interest/penalty, where identified.

** Including disputed dues aggregating Rs. 344 lacs in respect of Value Added Tax which have been stayed by the respective authorities.

# Rs. 41,000.

## Rs. 40,540.

### Rs. 24,860.

#### Rs. 2,486.

(x) The accumulated losses of the Company are more than fifty percent of its net worth at the end of the year. The Company has not incurred cash losses during the year and in the immediately preceding year.

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers. The Company did not have any outstanding dues to any financial institutions or debenture-holders during the year.

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

(xiii) According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year.

(xvi) According to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have been used for long-term investments, primarily for acquisition of fixed assets for Rs. 100,866 lacs.

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

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by way of public issues during the year. The Company has only received certain amounts against outstanding call money of the rights issue made in an earlier year.

(xxi) Based on the audit procedures performed and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Co. LLP

Chartered Accountants

Firm Registration No: 101248 W

Kaushal Kishore

Partner

Membership No: 090075

Place : Gurgaon Date : 27 May 2014


Mar 31, 2013

1. Report on the Financial Statements

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

2. Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of the 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 controls 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.

3. Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors'' 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 controls 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.

4. Basis for Qualified Opinion

The life of the Consumer Premises Equipment (CPE) for the purposes of depreciation has been estimated by the management as five years. However, in certain cases, the one-time advance contributions towards the CPEs in the form of rentals are recognized as revenue over a period of three years, which is not in line with the estimated life of such assets, in terms of Accounting Standard 19 ''Leases''. The impact of which on the financial statements has not been ascertained by the management. The Company has streamlined the above practice by recognising the revenue over a period of five years in respect of CPEs installed with effect from 1 April 2012.

This was a subject matter of qualification in our audit report on the financial statements for the previous year ended 31 March 2012 [also refer to note 50];

5. Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in para 4 above, "Basis for Qualified Opinion", the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

6. Emphasis of matter

Without qualifying our opinion, attention is invited to note 2(c) of the financial statements. The Company''s net worth as at the end of the financial year is completely eroded by its accumulated losses. However, the management has prepared the financial statements assuming that the Company will continue as a going concern since it has adequate resources in the form of operating cash flows and sanctioned credit facilities from lenders to adequately meet its obligation.

7. Report on Other Legal and Regulatory Requirements

(i) 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.

(ii) 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 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, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d. except for the effects of the matter described in para 4 above, " Basis for Qualified Opinion", 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; and

e. on the basis of written representations received from the directors as on 31 March 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 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.

Annexure referred to in paragraph 7 of the Independent Auditors'' Report to the Members of Dish TV India Limited on the financial statements for the year ended 31 March 2013.

(i) (a) According to the information and explanations given to us, the Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets, other than consumer premises equipment (CPE), installed at the customer premises and those in transit or lying with the distributors, have been physically verified by the management as per a phased programme to cover over a period of three years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. Discrepancies noticed on such verification were not significant and have been properly dealt with in the books of account. According to the information and explanations given to us, the existence of CPEs lying at the customer premises is considered on the basis of the ''active user status'' of the CPE.

(c) Fixed assets disposed off during the year were not substantial and, therefore, do not effect the going concern assumption.

(ii) (a) According to the information and explanations given to us, physical verification has been conducted by the management at reasonable intervals during the year in respect of inventories of stock in trade consisting of CPE related accessories in the Company''s possession. In our opinion, the frequency of physical verification is reasonable.

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

(c) On the basis of our examination of the records of inventories, we are of the opinion that the Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of inventories as compared to book records were not material and have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4(iii)(b) to (g) of the Order are not applicable.

(iv) According to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialized requirements and similarly certain goods/ services sold are for the specialized requirements of the buyers and suitable alternative sources are generally not available to obtain comparable prices, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any major weaknesses in the aforesaid internal control system.

(v) In our opinion, and according to the information and explanations given to us, there are no contracts and arrangements the particulars of which need to be entered into the register maintained under section 301 of the Companies Act, 1956.

(vi) According to the information and explanations given to us, the Company has not accepted any deposits from the public during the year within the meaning of Sections 58A and 58AA or other relevant provisions of the Companies Act, 1956 and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company in respect of the activities where, pursuant to the rules made by the Central Government, the maintenance of cost records has been prescribed under section 209(1) (d) of the Companies Act, 1956 and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of such records with a view to determine whether they are accurate or complete.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty and other material statutory dues, as applicable, have generally been regularly deposited during the year by the Company with the appropriate authorities except in respect of entertainment tax dues where there have been several delays, though the amounts have subsequently been paid to the authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, and other material statutory dues, as applicable, were in arrears as at 31 March 2013 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Cess and Excise duty, which have not been deposited with the appropriate authorities on account of any dispute, except as mentioned below:

(Amount in Rs. lacs)

Name of the Statute Nature of the Amount Amount dues involved paid under ** protest

Delhi Value Added Tax Value Added Tax 7 7 Act, 2004 Value Added Tax 244 20

Andhra Pradesh Value Value Added Tax 344* 18 Added Tax Act, 2005

Value Added Tax 286 286

Bihar Value Added Tax Value Added Tax 15 15 Act, 2005 Value Added Tax 59 43

Name of the Statute Period to which Forum where dispute is pending the amount relates

Delhi Value Added Tax Act 2004 March 2010 VAT Officer, Delhi VAT

April 2007 to VAT Tribunal, New Delhi March 2008

Andhra Pradesh Value Added Tax Act 2005 March 2008 to Andhra Pradesh High Court September 2008

2006-08 State Tribunal Appellate Authority, Hyderabad

Bihar Value Added Tax Act 2005 2007-08 Commercial Tax Officer, Patna

2008-09 Commercial Tax Officer, Patna

* Including disputed dues aggregating Rs. 344 lacs in respect of Value Added Tax which have been stayed by the respective authorities

** Including interest/penalty, where identified

# Rs. 41,000

## Rs. 36,000

### Rs. 40,540

(x) The accumulated losses of the Company are more than fifty percent of its net worth at the end of the year. The Company has not incurred cash losses during the year and in the immediately preceding year.

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers. The Company did not have any outstanding dues to any financial institutions or debenture-holders during the year.

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

(xiii) According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year.

(xvi) According to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have been used for long-term investments, primarily for acquisition of fixed assets for Rs. 70,173 lacs.

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

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by way of public issues during the year. The Company has only received outstanding call money against the rights issue made in an earlier year.

(xxi) Based on the audit procedures performed and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Co.

Chartered Accountants

Firm Registration No: 101248 W

Kaushal Kishore

Partner

Membership No: 090075

Place : Gurgaon

Date : 23 May 2013


Mar 31, 2012

1 We have audited the attached Balance Sheet of Dish TV India Limited ('the Company') as at 31 March 2012 and also the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3 As required by the Companies (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 Companies Act, 1956 ('the Act'), we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4 Without qualifying our opinion, attention is invited to note 2(b) of the financial statements. The Company's net worth as at the end of the financial year is completely eroded by its accumulated losses. However, the management has prepared the financial statements assuming that the Company will continue as a going concern since it has adequate resources in the form of operating cash flows and sanctioned credit facilities from lenders to adequately meet its obligation.

5 Further to our comments in the Annexure referred to in para 3 above, we report that:

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

(b) in our opinion, proper books of account, as required by law, have been kept by the Company so far as appears from our examination of 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) subject to our comments in paragraph 5 (f) below regarding non compliance in relation to Accounting Standard 19 'Leases', in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report, comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, to the extent applicable;

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

(f) the life of the Consumer Premises Equipment (CPE) for the purposes of depreciation has been estimated by the management as five years. However, in certain cases, the one-time advance contributions towards the CPEs in the form of rentals are recognized as revenue over a period of three years, which is not in line with the estimated life of such assets, in terms of Accounting Standard 19 'Leases', though the impact of which on the financial statements has not been ascertained by the management. This was a subject matter of qualifbation in our audit report on the financial statements for the previous year ended 31 March 2011 also [Pefer to note 39 (b)];

(g) during the previous year, the Company received a demand notice for income tax and interest thereon aggregating Rs. 4,056 lacs in relation to an earlier year, though reduced to Rs. 2,642 lacs during the year based on a rectification application filed. The matter pertains to short deduction of tax at source on certain payments and interest thereon for delayed period. The Company has disputed the above said demand and has filed an appeal against the same with the tax authorities. The Company, based on a legal view obtained in the matter, has not made any provision in the financial statements and has not assessed the impact of the above position on the subsequent years. Pending final conclusion, we are unable to comment on the matter and its consequent impact on the Statement of Profit and Loss for the year and the debit balance in the Statement of Profit and Loss at the end of the year. This was a subject matter of qualification in our audit report on the financial statements for the previous year ended 31 March 2011 also [Refer to note 49 (c)]; and

(h) subject to our comments in paragraphs 5 (f) and (g) above, the impact of which has not been ascertained, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2012;

(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.

Annexure referred to in paragraph 3 of the Auditors' Report to the Members of Dish TV India Limited on the accounts for the year ended 31 March 2012

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

(b) As explained to us, the fixed assets, other than consumer premises equipment (CPE), installed at the customer premises and those in transit or lying with the distributors, have been physically verified by the management as per a phased programme to cover over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. Discrepancies noticed on such verification were not significant and have been properly dealt with in the books of account. According to the information and explanations given to us, the existence of CPEs lying at the customer premises is considered on the basis of the 'active user status' of the CPE.

(c) Fixed assets disposed off during the year were not substantial and, therefore, do not effect the going concern assumption.

(ii) (a) According to the information and explanations given to us, physical verification has been conducted by the management at reasonable intervals during the year in respect of inventory of stock in trade consisting of CPEs and accessories in the Company's possession. In our opinion, the frequency of physical verification is reasonable.

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

(c) On the basis of our examination of the records of inventories, we are of the opinion that the Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of inventories as compared to book records were not material and have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4(iii)(b) to (g) of the Order are not applicable.

(iv) According to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company's specialised requirements and similarly certain goods/ services sold are for the specialised requirements of the buyers and suitable alternative sources are generally not available to obtain comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any major weaknesses in the aforesaid internal control system.

(v) (a) In our opinion, and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements referred to in para (v) (a) above, and exceeding the value of Rs. 5 lakhs with any party during the year have made at price which are reasonable having regard to the prevailing market price except for certain transactions which are for the specialized requirements of the respective parties and for which suitable alternate sources are not available to obtain comparable quotations.

(vi) According to the information and explanations given to us, the Company has not accepted any deposits from the public during the year within the meaning of Sections 58A and 58AA or other relevant provisions of the Companies Act, 1956 and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) Pursuant to the rules made by the Central Government, the maintenance of cost records has been prescribed under section 209(1)(d) of the Companies Act, 1956. According to the information and explanations given to us, the Company is in the process of aligning its financial accounting system in order to maintain the requisite cost accounting records. As informed to us, the Company is in the process of concluding and producing such records.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues, as applicable, have generally been regularly deposited during the year by the Company with the appropriate authorities except in respect of entertainment tax dues where there have been several delays, though the amount have subsequently been paid to the authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues, as applicable, were in arrears as at 31 March 2012 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty and Cess which have not been deposited with the appropriate authorities on account of any dispute, except as mentioned below:

Amount in Rs.lacs Name of the Nature of the Amount Amount Statute dues involved paid under protest

Value Added Tax 160 -

7 7 Delhi Value Added- Tax Act 2004 Value Added Tax 244 20 (including penalty and interest)

Value Added Tax 40 4

Value Added Tax 344* 18 Andhra Pradesh (including interest) Value Added Tax Value Added Tax 286 286 Act, 2005 (including penalty and interest)

Value Added Tax 15 15 Bihar Value Added Tax Act, 2005 59 43

Value Added Tax 1 - (including interest)

Value Added Tax 1 1 UP Trade Tax Act, 1948

# #

10 5

Income-tax Act, Income tax and 2,642 400 1961 interest



Name of the Period to which Forum where dispute is Statue the amount pending relates

January 2007 to VATO .Delhi VAT March 2007

March 2010 VATO, Delhi VAT

Delhi Value Added Tax Act, 2004 April 2007 to VAT Tribunal, New Delhi March 2008

AY 2007-08 VATO .Delhi VAT

March 2008 to Andhra Pradesh High Court September 2008

Andhra Pradesh Value Added Tax Act, 2005 2006-08 State Tribunal Appellate Authority, Hyderabad

Bihar Value Added Tax Act, 2005 2007-08 Commercial Tax Officer, Patna

2008-09 Commercial Tax Officer, Patna

UP Trade Tax Act, 1948 April 2005 to Joint Commissioner (Ap- March 2006 peal), Noida

2006-07 Additional Commissioner Appeal, Noida

2010-11 Deputy Commissioner, Noida

April 2011 CTO, Noida

Income-tax Act, 1961 Assessment year Commissioner of Income 2009-10 Tax-Appeal, Noida.



Name of the Nature of the Amount Amount Statute dues involved paid under protest

9 - Indian Customs Act, Special Additional 795 - 1962 Duty

Finance Act, 1994 Service tax 167 - (Service tax case)

Wealth tax 1 - Wealth Tax Act, 1957



Name of the Period to which Forum where dispute is Statue the amount pending relates

Assessment year Commissioner of Income 2006-07 Tax-Appeal, Mumbai

Indian Customs Act, 1962 April 2008 to CESTAT June 2009

Finance Act, 1994 (Service tax case) F Y 2006-07 to F Commissioner of Excise & Y 2010-11 Service Tax -Ghaziabad

Wealth Tax Act, 1957 AY 05-06 Asst. Commissioner of Income Tax, New Delhi



* Including disputed dues aggregating Rs. 344 lacs in respect of Value Added Tax which have been stayed by the respective authorities.

# Rs. 36,000.

(x) The accumulated losses of the Company are more than fifty percent of its net worth at the end of the year. The Company has not incurred cash losses during the year and in the immediately preceding year.

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers. The Company did not have any outstanding dues to any financial institutions or debenture-holders during the year.

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

(xiii) According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year.

(xvi) According to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have been used for long-term investments, primarily for acquisition of fixed assets for Rs. 86,934 lacs.

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

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by way of public issue during the year. The Company has only received outstanding call money against the rights issue made in the previous year.

(xxi) Based on the audit procedures performed and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Co.

Chartered Accountants

Firm Registration No: 101248W

Kaushal Kishore

Partner

Membership No: 090075

Place: Gurgaon Date : 16 May 2012






Mar 31, 2011

1. We have audited the attached Balance Sheet of Dish TV India Limited ('the Company') as at 31 March 2011 and also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (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 Companies Act, 1956 ('the Act'), we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

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

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

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

(d) subject to our comment in paragraphs 4 (f) and (g) below regarding non compliance, primarily in relation to Accounting Standard (AS) 13 'Accounting for Investments'; AS 28 'Impairment of Assets'; and AS 19 'Leases', in our opinion, the Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by this report, comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, to the extent applicable;

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

(f) the life of the Consumer Premise Equipment (CPE) for the purposes of depreciation has been estimated by the management as five years. However, in certain cases, the one- time advance contributions towards the CPEs in the form of rentals are recognized as revenue over a period of three years, which is not in line with the estimated life of such assets, in terms of AS-19 'Leases', though the impact of which on the financial statements has not been ascertained by the management [Refer to note 16 (b) of schedule 22]; and

(g) attention is invited to note 4 of schedule 22 which explains in details the accounting treatment followed by the Company on implementation of the Composite Scheme of Amalgamation and Arrangements between the Company and two of its subsidiary companies ('the Scheme'), duly approved by the High Court of Delhi. In terms of the Scheme, the excess of the book value of net assets of non- DTH related business, transferred to a subsidiary company, over the consideration received, has been adjusted directly in the 'General reserve' during the current year, instead of accounting for impairment of fixed assets transferred, as required by AS 28, and

providing for diminution in the value of investment transferred, as required by AS 13, in the Profit and Loss Account in the previous year. Had the Company followed the above Standards in the previous year, the loss on impairment of the above fixed assets/ provision for diminution in the value of investments would have been adjusted in the Profit and Loss Account and loss for the previous year and the debit balance in the Profit and Loss Account as at 31 March 2010 would have been higher by Rs. 1,743,523,943.

Since the aforesaid loss on impairment of fixed assets/diminution in the value of investment have not been recognised even in the current year as a prior period item, which together with the impact of the transfer of other net assets/ liabilities in the current year, net of consideration received, have been adjusted in General Reserve directly as mentioned above, the loss for the year and the debit balance in the Profit and Loss Account at the end of the year are lower by Rs. 1,743,523,943. However, on implementation of the Scheme, the above net loss stands adjusted directly in the General Reserve in accordance with the accounting treatment prescribed in the Scheme approved by the High Court of Delhi.

This was a subject matter of qualification in the audit report on the financial statements for the year ended 31 March 2010 also; and

(h) during the year, the Company received a demand notice for income tax and interest thereon aggregating Rs. 4,05,614,101 in relation to an earlier year. The matter pertains to short deduction of tax at source on certain payments and interest thereon for delayed period. The Company has disputed the abovesaid demand and has filed an appeal against the same with the tax authorities. The Company, based on a legal view obtained in the matter, has not made any provision in the financial statements and has not assessed the impact of the above position on the subsequent years. Pending final conclusion, we are unable to comment on the matter and its consequent impact on the Profit and Loss Account for the year and the debit balance in the Profit and Loss Account at the end of the year [Refer to note 3 (b) of schedule 22]

Subject to our comments in paragraphs 4 (f), (g) and (h) above, the impact if which, to the extent ascertained, has been explained therein, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2011;

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

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

Annexure referred to in paragraph 3 of the Auditors' Report to the Members of Dish TV India Limited on the accounts for the year ended 31 March 2011

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

(b) As explained to us, the fixed assets, other than consumer premises equipment (CPE), installed at the customer premises and those in transit or lying with the distributors, have been physically verified by the management as per a phased programme to cover over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. Discrepancies noticed on such verification were not significant and have been properly dealt with in the books of account. According to the information and explanations given to us, the existence of CPEs lying at the customer premises is considered on the basis of the 'active user status' of the CPE.

(c) According to the information and explanations given to us, the assets disposed off during the current year including those pursuant to the Composite Scheme of Amalgamation and Arrangement between the Company, Agrani Satellite Services Ltd ('ASSL'), Integrated Subscriber Management Services Ltd ('ISMSL') and their respective shareholders and creditors ('the Scheme') were not substantial and do not effect the going concern assumption.

(ii) (a) According to the information and explanations given to us, physical verification has been conducted by the management at reasonable intervals during the year in respect of inventory of stock in trade consisting of CPEs and accessories in the Company's possession. In our opinion, the frequency of physical verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures for physical verification of

inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the records of inventories, we are of the opinion that the Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of inventories as compared to book records were not material and have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4(iii)(b) to (g) of the Order are not applicable.

(iv) According to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company's specialised requirements and similarly certain goods/ services sold are for the specialised requirements of the buyers and suitable alternative sources are generally not available to obtain comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any major weaknesses in the aforesaid internal control system.

(v) (a) In our opinion, and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of

contracts or arrangements referred to in para (v) (a) above, and exceeding the value of Rs. 5 lakhs with any party during the year have made at price which are reasonable having regard to the prevailing market price except for certain transactions which are for the specialized requirements of the respective parties and for which suitable alternate sources are not available to obtain comparable quotations.

(vi) According to the information and explanations given to us, the Company has not accepted any deposits from the public during the year within the meaning of Sections 58A and 58AA or other relevant provisions of the Companies Act, 1956 and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for any of the services rendered by the Company.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues, as applicable, have generally been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues, as applicable, were in arrears as at 31 March 2011 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty and Cess which have not been deposited with the appropriate authorities on account of any dispute, except as mentioned below:

(Amount in Rs.)

Name of the Nature of the dues Amount Amount Statute involved paid under protest

Delhi Value Value Added Tax 16,045,548 - Added Tax Act, 2004 668,627 668,627

Value Added Tax 24,446,261 (including penalty and interest) Andhra Value Added Tax 34,447,104* 1,818,709 Pradesh Value (including interest) Added Tax Act, Value Added Tax 28,608,770 28,608,770 2005 (including penalty and interest)

Bihar Value Value Added Tax 4,749,874 4,701,344 Added Tax Act, 2005

Name of the Statute Period to which the Forum where dispute is amount relates pending

Delhi Value Added Tax Act, 2004 January 2007 to Special Commissioner-I, March 2007 New Delhi

March 2010 Special Commissioner-I, New Delhi

Andhra Pradesh Value Added Tax Act, 2005 April 2007 to Special Commissioner-I, March 2008 New Delhi

March 2008 to Andhra Pradesh High Court September 2008

Bihar Value Added Tax Act, 2005 2006-08 State Tribunal Appellate

Authority, Hyderabad

2008-09 Commercial Tax Officer,

Patna

(Amount in Rs.)

Name of the Nature of the dues Amount Amount Statute involved paid under protest



UP Trade Tax Value Added Tax 67,388 - Act, 1948 (including interest)

100,000 100,000

272,712 272,712

Value Added Tax 413,250 413,250

36,000 36,000

Income-tax Act, Income tax and 4,05,61 4,101 1961 interest

Indian Customs Special Additional 149,40 6,086 Act, 1962 Duty



Name of the Statute Period to which the Forum where dispute is amount relates pending

UP Trade Tax Act, 1948 April 2005 to Joint Commissioner March 2006 (Appeal),

2006-07 Additional Commissioner Appeal-1, Noida 2006-07 and Deputy Commissioner, 2007-08 Noida

2009-10 Additional Commissioner (Commercial Tax), Noida 2010-11 Deputy Commissioner- 3, Noida Income-tax Act, 1961 Assessment year The Assistant Commissioner 2009-10 of Income Tax, Noida.

Indian Customs Act, 1962 April 2008 to The Commissioner, ICD June 2009

* Including disputed dues aggregating Rs. 34,447,104 in respect of Value Added Tax which have been stayed by the respective authorities.

(x) The accumulated losses of the Company are more than fifty percent of its net worth at the end of the year. The Company has not incurred cash losses during the year and in the immediately preceding year.

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers. The Company did not have any outstanding dues to any financial institutions or debenture-holders during the year.

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

(xiii) According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year.

(xvi) According to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have been used for long-term investments primarily for acquisition of fixed assets for Rs. 6,828,844,657.

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

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by way of public issue during the year. The Company has only received outstanding call money against the rights issue made in the previous year.

(xxi) Based on the audit procedures performed and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

For B S R & Co.

Chartered Accountants

Firm Registration No.: 101248 W

Kaushal Kishore

Partner

Membership No.: 090075

Place: Gurgaon

Date: 23 May 2011

 
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