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Auditor Report of EIH Ltd.

Mar 31, 2017

To

The Members EIH Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of EIH Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2017, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information (herein after referred to as "standalone Ind AS financial statements").

Management''s Responsibility for the Standalone Ind AS Financial Statements

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

Auditor''s Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error.

In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS 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 standalone Ind AS financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS 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 including the Ind AS, of the financial position of the Company as at 31st March, 2017, and its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Emphasis of Matter

We draw attention to the following matters in the Notes to the standalone Ind AS financial statements:

a) Note No 6 and Note No 45 to the standalone Ind AS financial statements wherein the Company has stated that adjustments for impairment is not considered necessary in respect of investments of Rs. 1184.88 Million in EIH Flight Services Limited Mauritius in view of the business valuation made by the independent valuer even though the net worth of EIH Flight Services Limited Mauritius continues to be negative.

b) Note No 3(ii) to the standalone Ind AS financial statements regarding disclosure of advance towards equity shares in Mashobra Resort Limited and allotment of shares pending settlement of legal issues between Government of Himachal Pradesh and EIH Limited. The said note describes the uncertainty related to the outcome of the above legal matters and accordingly the impact, if any, on the standalone Ind AS financial statements has not been ascertained. As such the uncertainty of the allotment of shares still continues.

Our opinion is not modified in respect of these matters.

Other Matter

The comparative financial information of the Company for the year ended March 31, 2016 and the transition date opening balance sheet as at April 1, 2015 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006, audited by us and on which we expressed an unmodified opinions in our reports for the year ended March 31, 2016 and March 31, 2015 dated May 26, 2016 and May 30, 2015 respectively, as adjusted for the differences in accounting principles adopted by the Company on transition to the Ind AS which have been audited by us. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in

"Annexure A", a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 Balance Sheet, the Statement of Profit and Loss, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

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

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B" and

g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 read with the Companies (Audit and Auditors) Amendment Rules, 2017, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations against the Company on its financial position in its standalone Ind AS financial statements in respect of claims and demands on the Company which are being contested as mentioned in Note 41 (a) and 3 (ii).

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

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

iv. The Company has provided requisite disclosures in the standalone Ind AS financial statements as to the holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company and produced to us by the management. Refer Note 47 to the standalone Ind AS financial statements.

(Referred to in paragraph 1 under the heading ''Report on Other Legal and Regulatory

Requirements'' of our report at even date)

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

(b) The fixed assets have been physically verified by the Management during the year in accordance with a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification which were not material have been properly dealt with in the books of account.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

ii. As explained to us, inventories have been physically verified by the Management during the year at reasonable intervals. In respect of stocks lying with third parties, certificates confirming stocks have been received for stocks held. The discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

iii. The Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Therefore, clauses (iii) (a), (b) and (c) of the aforesaid Order are not applicable.

iv. In our opinion and according to the information and explanations given to us, the Company has not violated the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of loans, investments, guarantees and security.

v. The Company has not accepted any deposits from the public. As such requirement of clause (v) of the aforesaid order is not applicable.

vi. The Central Government has not prescribed the maintenance of cost records under section 148 (1) of the Act for the Company.

vii (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, service tax, custom duty, excise duty, value added tax, cess and any other statutory dues applicable to it.

According to information and explanations given to us, there are no undisputed amounts payable in respect of income tax, sales tax, service tax, customs duty, excise duty, value added tax, cess that were outstanding, as at 31st March, 2017 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the following dues of income tax, sales tax/value added tax, customs duty, service tax and luxury tax have not been deposited by the Company on account of disputes:

Sl.

No

Name of Statute

Nature of Dues

Forum where dispute is pending

Rupees

Million

1

Income Tax Act, 1961

Income Tax

CIT (Appeals), Kolkata for FY 1999-2000, 2006-07 to 2007-08, 2009-2010 to 2010-2011 and 2013-14

333.29

ITAT, Kolkata for FY 2007-2008 to 2008-2009 and 2010-11 to 2011-12

124.50

Total

457.79

2

Value Added Tax of various States

Value Added Tax/Sales Tax

Additional Commissioner of Sales Tax & Vat, Kolkata for FY 2011-2012

0.62

Senior Jt. Commissioner Sales Tax, Kolkata for FY 2013 -2014

1.68

Maharashtra Sales Tax Tribunal/

Joint Commissioner of Sales Tax Appeals, Mumbai for FY 1999-2000, 2008-2009 and 2009-2010

7.88

Additional Commissioner (Appeals) Commercial Tax Debt, Udaipur for FY 2011-12 to 2013-2014

3.63

Appellate and Revision Board Commercial Taxes, West Bengal. Kolkata for FY 2005-2006 to 2009-2010

10.39

Tax Tribunal, Chandigarh for FY 2011-2012

0.25

Total

24.45

3

Customs Act, 1962

Customs Duty

CESTAT Tribunal, Delhi for FY 2008-2009

429.66

Total

429.66

4

Rajasthan Tax on Luxuries (In Hotels and Lodging House) Act, 1990

Luxury Tax

Rajasthan Tax Board, Ajmer for Luxury Tax for FY 2010-2011 to 2013-2014

3.50

Total

3.50

5

Service Tax

Service Tax

Commissioner of Service Tax, Division-1 Delhi for FY 2007-2008 to 2009-2010

6.40

Commissioner of Central Excise (Appeal-I), Kolkata for FY 2001-2006

0.27

CEST Appellate Tribunal, Kolkata for FY 2008-2009 to 2011-12

2.63

CEST Appellate Tribunal, Bangalore for FY 2004-2006.

1.11

CEST Appellate Tribunal, New Delhi for FY 2010-2011 to 2013-2014

24.15

Commissioner of Service Tax (Appeal), Mumbai for FY 2012-13

33.54

Commissioner of Service Tax, Delhi for 2003-2004 to 2006-2007

48.90

Deputy Commissioner of Service Tax, Delhi 2003-04 to 2005-06

3.86

CESTAT Tribunal, Delhi for FY 2008-2011

1.26

Total

122.12

viii In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks and financial institutions. There are no debenture holders and loan from Government.

ix The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year. In our opinion and according to the information and explanations given to us, the term loans taken by the Company have been applied for the purpose for which they were raised.

x According to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

xi According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

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

xiii. In our opinion and according to the information and explanations given to us, all transactions with the related parties are in compliance with section 177 and 188 of the Companies act, 2013 where applicable and the details of such transactions have been disclosed in the standalone Ind AS financial statements as required by the applicable standards.

xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

xv. In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

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

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

We have audited the internal financial controls over financial reporting of EIH Limited ("the Company") as at 31st March, 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

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

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls over Financial Reporting

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

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For RAY & RAY

Chartered Accountants

(Firm''s Registration No.301072E)

R.N. ROY

Place: Gurugram Partner

Date: 30th May 2017 Membership No. 8608


Mar 31, 2015

Not Available


Mar 31, 2014

We have audited the accompanying financial statements of EIH Limited ("the Company"), which comprise the Balance sheet as at 31st March, 2014, and the statement of profit and Loss and Cash Flow statement for the year then ended, and a summary of signifcant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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

Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. the procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

a) In the case of the Balance sheet, of the state of affairs of the Company as at 31st March, 2014;

b) In the case of the statement of profit and Loss, of the profit for the year ended on that date; and

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

Emphasis of Matter

We draw attention to note 39 to the Financial statements relating to the stay order given by the High Court of Himachal pradesh against the issue and offer of shares by Mashobra resort Limited to the Company against the advances made by the Company thereby making such adjustment of the advances dependent upon the Hon''ble High Court''s decision. our opinion is not qualifed in this respect.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s report) order, 2003, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act 1956 ("the Act"), we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

a. we have obtained all the information and explanations, which, to the best of our knowledge and belief, were necessary for the 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 dealt with by this report comply with the Accounting standards referred to in sub-section (3C) of section 211 of the Act;

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

ANNEXURE TO INDEPENDENT AUDITOR''S REPORT (Referred to in paragraph 1 under the heading "report on other Legal and regulatory requirements" of our report of even date)

i (a) the Company have maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verifed by the Management during the year but there is a regular programme of verifcation which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. the discrepancies noticed on such verifcation which were not material have been properly dealt with in the books of accounts.

(c) the fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

ii (a) As explained to us, inventories have been physically verifed by the Management during the year at reasonable intervals. In our opinion, the frequency of verifcation is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verifcation of inventories followed by the Management were 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. the discrepancies noticed on verifcation between the physical stocks and the book records were not material.

iii (a) The Company has not granted any loans, secured or unsecured, to companies, frms or other parties covered in the register maintained under section 301 of the Act.

(b) In view of our comments in paragraph iii (a) above, the provisions of Clauses iii (b), iii (c) and iii (d) of paragraph 4 of the aforesaid order are not applicable to the Company.

(c) The Company has not taken any loan, secured or unsecured, from companies, frms or other parties covered in the register maintained under section 301 of the Act.

(d) In view of our comment in paragraph iii (c) above, clauses iii (f) and iii (g) of paragraph 4 of the aforesaid order are not applicable to the Company.

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

v According to the information and explanations given to us, we are of the opinion that no particulars of contracts or arrangements that need to be entered into the register maintained under section 301 of the Act. According, clause v(b) of paragraph 4 of the aforesaid order is not applicable to the Company.

vi the Company has not accepted any deposit from the public during the year under sections 58A and 58AA of the Act and the Companies (Acceptance of deposits) rules, 1975. According to information and explanations given to us, no order has been passed by the Company Law Board or the national Company Law tribunal or the reserve Bank of India or any Court or any other tribunal.

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

viii The Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the Act for the Company.

ix (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, value added tax/sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no undisputed amount payable in respect of income tax, wealth tax, service tax, value added tax/sales tax, customs duty, excise duty and cess which were outstanding as at 31st March, 2014 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, the following dues of income tax, value added tax/sales tax, customs duty, excise duty and service tax have not been deposited by the Company on account of disputes:

Sl. No. Name of the Statute Nature of Forum where Amount the dues dispute is (Rupees in pending Million)

1 Income tax Act, 1961 Income CIT (Appeals), Kolkata for 295.02 Tax Assessment Years 2000-2001, 2005-2006, 2006-2007, 2007-2008, 2008-2009 and 2010-2011

ITAT, Kolkata for 422.48 Assessment Years 2002-2003, 2003-2004, 2004-2005, 2006-2007, 2008-2009 and 2009-2010

TOTAL 717.50

2. Income tax Act, 1961 Tax Deducted CIT(Appeals), Delhi for 14.59 at source Assessment Years 2004-2005 to 2007-2008, 2010-2011 and 2011-2012

CIT (Appeals), Mumbai for 13.84 Assessment Years 2009-2010, and 2010-2011

DCIT (Appeals), Delhi for 0.44 Assessment Years 2011-2012

TOTAL 28.87

3. Value Added tax of VAT/ Maharashtra Sales tax 11.98 various states Sales tax tribunal/Joint Commissioner of sales tax Appeals, Mumbai for 1999-2000, 2002-2003, 2008-2009 and 2009-2010

Commissioner of sales tax, 3.07 Mumbai for 2005-2006

Sr. Joint Commiss -ioner of 0.62 Sales tax & VAT, Kolkata for 2009-2010

Additional Commiss -ioner of 12.52 Sales tax & Vat, Kolkata for 2007-2008, 2008-2009 and 2010-2011

Joint Commissioner of sales 10.57 Tax appeals, Kolkata for 2005-2006, 2007-2008, 2009-2010 and 2010-2011

TOTAL 38.76

4. Customs Act, 1962 Customs CESTAT Tribunal, Delhi for 429.66 Duty 2008-2009

TOTAL 429.66

5. Central excise Excise Commissioner (Appeals) of 3.53 Act, 1944 Duty Central excise, Mumbai for 2002-2004

Customs, Excise & Service tax 69.53 Appellate tribunal, Mumbai for 2005-2006

Customs, excise & service tax 26.01 Appellate tribunal, Delhi for 2004-2005 and 2005-2006

TOTAL 99.07

6. Central Excise Service Tax Various show Cause Notices 60.53 Act, 1944 served for 2004-2007 and 2009-2011 and replied

Commissioner of Central 0.27 excise (Appeal-I), Kolkata 2001-2006

Commissioner of Service tax, 22.71 Kolkata for 2009-2010 to 2011-2012

Joint Commissioner of Central 1.11 excise (Appeals), Cochin for 2004-2006

Commissioner of Service tax, 6.40 Delhi for 2007-2008 to 2009-2010

Custom Excise and Service Tax 6.69 Appellate tribunal, New Delhi for 2011-2012

Commissioner of Service tax, 30.81 Delhi for 2003-2004 to 2006-2007

Commissioner of Service tax, 4.08 Kolkata for 2008-2009 to 2011-2012

TOTAL 132.60

x The Company has no accumulated losses and has not incurred any cash loss during the year covered by our report and in the immediately preceding financial year.

xi In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions and banks. there are no debenture holders.

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

xiii In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly, the provisions of Clause (xiii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xiv In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause (xiv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xv The Company has given guarantees for loans taken by its subsidiary company from banks and financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions on which the Company has given guarantees for loans taken from banks and financial institutions are not, prima-facie, prejudicial to the interest of the Company.

xvi According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

xvii According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investments.

xviii According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies/frms covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause (xviii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xix The Company has not issued unsecured debentures during the year under audit. Accordingly, the provisions of clause (xix) of paragraph 4 of the aforesaid order are not applicable to the Company.

xx The Company has not raised any money by way of public issue during the year. Accordingly, the provisions of clause (xx) of paragraph 4 of the aforesaid order are not applicable to the Company.

xxi 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 RAY & RAY

Chartered Accountants

Firm''s Registration Number 301072E

A.K. SHARMA New Delhi Partner

30th May, 2014 Membership Number 80085


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Management, as well as evaluating the overall presentation of the financial statements.

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

Emphasis of Matter

Without expressing a qualified opinion, we draw attention as a Matter of Emphasis to Note No. 39 of Notes to the Accounts relating to the pending issue of shares by Mashobra Resort Limited against the advances made by the Company.

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 31st March, 2013;

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

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

Report on Other Legal and Regulatory Requirements

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

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

a. we have obtained all the information and explanations, which, to the best of our knowledge and belief, were necessary for the 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 dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

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

ANNEXURE TO THE AUDITOR''S REPORT

(Referred to in praagraph 1 under the heading Report on Other Legal Requirements)

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

(b) All the assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification which were not material have been properly dealt with in the books of accounts.

(c) the fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

ii (a) As explained to us, inventories have been physically verified by the Management during the year at reasonable intervals. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were 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. the discrepancies noticed on verification between the physical stocks and the book records were not material.

iii (a) the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 301 of the Act.

(b) In view of our comments in paragraph iii (a) above, the provisions of Clauses iii (b), iii (c) and iii (d) of paragraph 4 of the aforesaid order are not applicable to the Company.

(c) the Company has not taken any loan, secured or unsecured, from companies, firms or other parties covered in the Register maintained under section 301 of the Act.

(d) In view of our comment in paragraph iii (c) above, clauses iii (f) and iii (g) of paragraph 4 of the aforesaid order are not applicable to the Company.

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

v According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into the Register maintained under Section 301 of the Act. According, clause v(b) of paragraph 4 of the aforesaid Order is not applicable to the Company.

vi The Company has not accepted any deposit from the public during the year under Sections 58A and 58AA of the Act and the Companies (Acceptance of Deposits) Rules, 1975. According to information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.

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

viii The Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the Act for the Company.

ix (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, value added tax/sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no undisputed amount payable in respect of income tax, wealth tax, service tax, value added tax/sales tax, customs duty, excise duty and cess which were outstanding as at 31st March, 2013 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of wealth tax, and cess which have not been deposited on account of any dispute other than disputed income tax, value added tax/sales tax, customs duty, excise duty and service tax as indicated below:

Sl. No. Name of the Statute Nature of Forum where Amount the dues dispute is (Rupees in pending Million)

1 Income Tax Act, 1961 Income CIT (Appeals), Kolkata for 224.40 Tax Assessment Years 2000-2001, 2007-2008, 2009-2010 and 2010-2011

ITAT, Kolkata for 379.50 Assessment Years 2002-2003, 2003-2004, 2004-2005, 2005-2006, 2006-2007 & 2008-2009

TOTAL 603.90

2. Income Tax Act, 1961 Tax Deducted CIT (Appeals), Delhi for 14.16 at Source Assessment Years 2004-2005 to 2007-2008, 2010-2011 and 2011-2012

TOTAL 14.16

x the Company has no accumulated losses and has not incurred any cash loss during the year covered by our Report and in the immediately preceding financial year.

xi In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions and banks. there are no debenture holders.

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

xiii In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. therefore, the provisions of Clause (xiii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xiv In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause (xiv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xv the Company has given guarantees for loans taken by its subsidiary companies from banks and financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions on which the Company has given guarantees for loans taken from banks and financial institutions are not, prima-facie, prejudicial to the interest of the Company.

xvi According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

xvii According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investments.

xviii According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies/firms covered in the Register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause (xviii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xix The Company has not issued unsecured debentures during the year under audit. Accordingly, the provisions of clause (xix) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xx The Company has not raised any money by way of public issue during the year. Accordingly, the provisions of clause (xx) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xxi 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 RAY & RAY

Chartered Accountants

Firm''s Registration Number 301072E

R.N. ROY

Kolkata Partner

30th May, 2013 Membership Number 8608


Mar 31, 2012

1. We have audited the attached Balance sheet of EIH Limited ('the Company') as at 31st March, 2012, the statement of profit and Loss and also the Cash Flow statement for the year ended on that date annexed thereto. these Financial statements are the responsibility of the Company's Management. our responsibility is to express an opinion on these Financial statements based on our audit.

2. We conducted our audit in accordance with the 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, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act 1956 ('the Act') and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Without expressing a qualified opinion, we draw attention as a matter of emphasis to Note no. 39 of Notes to the Accounts relating to the pending issue of shares by Mashobra resort Limited against the advances made by the Company.

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

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

ii) 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;

iii) 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;

iv) In our opinion, the Balance sheet, statement of profit and Loss and Cash Flow statement dealt with by this report comply with the Accounting standards referred to in sub-section (3C) of section 211 of the Act;

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

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with the Notes to the Accounts 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 31st March, 2012;

b) In the case of the statement of profit and Loss, of the profit for the year ended on that date; and

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

ANNEXURE TO THE AUDITOR'S REPORT

The Annexure referred to in our report to the members of EIH Limited ('the Company') for the year ended 31st March, 2012. We report that :

i (a) the Company have maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. the discrepancies noticed on such verifcation which were not material have been properly dealt with in the books of accounts.

(c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

ii (a) As explained to us, inventories have been physically verified by the Management during the year at reasonable intervals. in our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were 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. the discrepancies noticed on verification between the physical stocks and the book records were not material.

iii (a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 301 of the Act.

(b) In view of our comments in paragraph iii (a) above, the provisions of Clauses iii (b), iii (c) and iii (d) of paragraph 4 of the aforesaid order are not applicable to the Company.

(c) The Company has not taken any loan, secured or unsecured, from companies, firms or other parties covered in the register maintained under section 301 of the Act.

(d) In view of our comment in paragraph iii (c) above, clauses iii (f) and iii (g) of paragraph 4 of the aforesaid order are not applicable to the Company.

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

v On the basis of our examination of the books of account and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into the register maintained under section 301 of the Act have been so entered. According to the information and explanations given to us, there are no transactions during the year that need to be entered into the register maintained under section 301 of the Act and therefore, clause v(b) of paragraph 4 of the aforesaid order is not applicable to the Company.

vi The Company has not accepted any deposit from the public during the year under sections 58A and 58AA of the Act and the Companies (Acceptance of deposits) rules, 1975. According to information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law tribunal or the reserve Bank of India or any Court or any other tribunal.

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

viii The Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the Act for the Company.

ix (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income tax, value added tax/sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441A of the Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing the same.

(b) According to the information and explanations given to us, there are no undisputed amount payable in respect of income tax, wealth tax, service tax, value added tax/sales tax, customs duty, excise duty and cess which were outstanding as at 31st March, 2012 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of wealth tax, and cess which have not been deposited on account of any dispute other than disputed income tax, value added tax/sales tax, customs duty, excise duty and service tax as indicated below:

Sl. No. Name of the Nature of Forum where Amount Statute the dues dispute is (Rupees in pending Million)

1 Income tax Act, 1961 i) income Cit (Appeals), Kolkata for tax Assessment Years 2009-10 128.70 it At, Kolkata for Assessment Years 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 & 2008-09 379.81

ii) Fringe Cit (Appeals), Kolkata for Beneft Assessment Years 2006-07 & tax 2009-2010 19.67

TOTAL 528.18

2. Income tax Act, 1961 tax deducted Cit (Appeals), delhi for at source Assessment Years 2003-04 to 2006-07 & 2009-10 11.81

Cit (Appeals), Mumbai for Assessment Years 2009-10 & 2010-11 13.84

Cit (Appeals), delhi for Assessment Years 2008-09 & 2011-12 0.23

TOTAL 25.88

3. Value Added tax of sales tax Maharashtra sales tax various states tribunal/Joint Commissioner of sales tax, Appeals-ii, Mumbai for 1999-2000 & 2001-02 to 2004-05 15.01

Appellate and revisional Board, Kolkata for 2004-05 4.27

Commissioner of sales tax, Mumbai for 2006-07 3.07

Commissioner of sales tax, Kolkata 2005-06 & 2006-07 0.99

Appellate deputy Commissioner, Kanchipuram 2005-06 2.58

TOTAL 25.92

4. Customs Act, 1962 Customs duty CestAt/tribunal for 2008-09 429.66

TOTAL 429.66

5. Central excise excise duty Customs, excise & service tax Act, 1944 Appellate tribunal, Mumbai for 2002-04 3.53

Customs, excise & service tax Appellate tribunal, Mumbai for 2005-06 69.53

Customs, excise & service tax Appellate tribunal, delhi for 2005-06 26.01

TOTAL 99.07

6. Central excise service tax Customs, Central excise & Act, 1944 service tax, delhi for 2004-06 22.38

Various show Cause Notices served for 2009-2011 and replied 40.27

Customs and service tax Appellate tribunal, Kolkata 2001-06 0.27

Joint Commissioner of Central excise (Appeals), Cochin for 2004-05 1.11

TOTAL 64.03

x The Company has no accumulated losses and has not incurred any cash loss during the year covered by our report and in the immediately preceding financial year.

xi Based on our audit procedures and, according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. there are no debenture holders.

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

xiii In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. therefore, the provisions of Clause (xiii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xiv In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. However, reasonable records have been maintained of shares and securities held as investments. All the shares and securities held by the Company as investments are in its own name. However, the provisions of Clause (xiv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xv The Company has given guarantees for loans taken by its subsidiaries and associate company from banks and financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions on which the Company has given guarantees for loans taken from banks and financial institutions are not, prima-facie, prejudicial to the interest of the Company.

xvi According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

xvii According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investments.

xviii According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies/firms covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause (xviii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xix The Company has not issued unsecured debentures during the year under audit. Accordingly, the provisions of clause (xix) of paragraph 4 of the aforesaid order are not applicable to the Company.

xx We have verified the end use of money raised by the rights issue of equity shares in 2011 as disclosed in Note 32 of Notes to the Accounts.

xxi During the course of our examination of the books of accounts carried out in accordance with Generally Accepted Auditing practices, we have neither come across any instance of fraud on or by the Company nor have we been informed of any such case by the Management.

For RAY & RAY

Chartered Accountants

A. K. SHARMA

Partner

Gurgaon Membership Number 80085

29th May, 2012 Firm's registration Number 301072E


Mar 31, 2011

1. We have audited the attached Balance sheet of eiH LiMited ("the Company”) as at 31st March, 2011, the Profit and Loss Account and also the Cash Flow statement for the year ended on that date annexed thereto. these Financial statements are the responsibility of the Companys Management. our responsibility is to express an opinion on these Financial statements based on our audit.

2. We conducted our audit in accordance with the 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 signifcant 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 (Auditors report) order, 2003, issued by the Central Government of india in terms of sub-section (4A) of section 227 of the Companies Act 1956 (‘the Act), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specifed in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

ii) 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;

iii) the Balance sheet, Profit and Loss Account and Cash Flow statement dealt with by this report are in agreement with the books of account;

iv) in our opinion, the Balance sheet, Profit and Loss Account and Cash Flow statement dealt with by this report comply with the Accounting standards referred to in sub- section (3C) of section 211 of the Act;

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

vi) in our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with schedules 1 to 24 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 31st March, 2011;

b) in the case of the Profit and Loss Account, of the Profit 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.

ANNEXURE TO THE AUDITORS REPORT (referred to in paragraph 3 of our report of even date)

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

(b) All the assets have not been physically verifed by the Management during the year but there is a regular programme of verifcation which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. the discrepancies noticed on such verifcation are being reconciled.

(c) the fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

ii (a) As explained to us, inventories has been physically verifed by the Management during the year at reasonable intervals. in our opinion, the frequency of verifcation is reasonable.

(b) in our opinion and according to the information and explanations given to us, the procedures of physical verifcation of inventories followed by the Management were 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. the discrepancies noticed on verifcation between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

iii (a) the Company has not granted any loans, secured or unsecured, to companies, frms or other parties covered in the register maintained under section 301 of the Act.

(b) in view of our comments in paragraph iii (a) above, the provisions of Clauses iii (b), iii (c) and iii (d) of paragraph 4 of the aforesaid order are not applicable to the Company.

(c) the Company has not taken any loan, secured or unsecured, from companies, frms or other parties covered in the register maintained under section 301 of the Act.

(d) in view of our comment in paragraph iii (c) above, clauses iii (f) and iii (g) of paragraph 4 of the aforesaid order are not applicable to the Company.

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

v on the basis of our examination of the books of account and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into the register maintained under section 301 of the Act have been so entered. According to the information and explanations given to us, there are no transactions during the year that need to be entered into the register maintained under section 301 of the Act and therefore, clause v(b) of paragraph 4 of the aforesaid order is not applicable to the Company.

vi the Company has not accepted any deposit from the public during the year under sections 58A and 58AA of the Act and the Companies (Acceptance of deposits) rules, 1975. According to information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law tribunal or the reserve Bank of india or any Court or any other tribunal.

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

viii the Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the Act for the Company.

ix (a) the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, value added tax/sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441A of the Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing the same.

(b) According to the information and explanations given to us, there are no undisputed amount payable in respect of income tax, wealth tax, service tax, value added tax/sales tax, customs duty, excise duty and cess which were outstanding as at 31st March, 2011 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of wealth tax, and cess which have not been deposited on account of any dispute other than disputed income tax, value added tax/sales tax, customs duty, excise duty and service tax as indicated below:

Sl. No. Name of the Statute Nature of Forum where Amount the dues dispute is (Rupees in pending Million)

1 income tax Act, 1961 i) income Cit (Appeals) for tax Assessment Years 2007-08 & 2008-09 220.45 ITAT, Kolkata for Assessment Years 2002-03, 2003-04, 2004-05, 2005-06 & 2006-07 370.54

ii) Fringe Cit(Appeals) for Beneft Assessment Years 2006-07 & tax 2007-08 2.63

TOTAL 593.62

2. income tax Act, 1961 tax deducted Commissioner of income tax at source (Appeals) for Assessment Years 2005-06 & 2007-08 5.25

Commissioner of income tax (Appeals) delhi for 2004-2005 to 2007-2008 9.37

TOTAL 14.62

3. sales tax Acts of sales tax Maharashtra sales tax various states tribunal, Mumbai for 1999-2000 to 2004-05 15.14

Additional Commissioner (Appellate Board)/tribunal, Kolkata for 2004-05 4.27

deputy Commissioner, sales tax, Mumbai for 2005-06 3.07

sr. Jt. Commissioner of sales tax/Additional Commissioner of sales tax for 2005-06 & 2007-08 6.11

High Court, Chennai for 2005-06 2.58

TOTAL 31.17

4. Customs Act, 1962 Custom duty CestAt/tribunal for 2008-09 429.66

TOTAL 429.66

5. Central excise excise duty Customs, excise & service tax Act, 1944 Appellate tribunal for 2002-03 to 2005-06 35.33

TOTAL 35.33

6. service tax service tax Commissioner of service tax for 2004-05 to 2006-07 30.81 CESTAT, delhi for 2004-05 & 2005-06 3.86

show Cause Notice served, Appeal is yet to be filed for 2004-05 to 2007-08 and 2009-10 14.33

Commissioner of Central excise (Appeals), Cochin for 2004-05 to 2006-07 1.11

Appeal is in process of being filed for 2002 to 2006 to Commissioner of Central excise. 0.27

TOTAL 50.38

x the Company has no accumulated losses and has not incurred any cash loss during the year covered by our report and in the immediately preceding financial year.

xi Based on our audit procedures and, according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. there are no debenture holders.

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

xiii in our opinion, the Company is not a chit fund or a nidhi /mutual beneft fund/ society. therefore, the provisions of Clause (xiii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xiv in our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. However, reasonable records have been maintained of shares and securities held as investments. All the shares and securities held by the Company as investments are in its own name. However, the provisions of Clause (xiv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xv the Company has given guarantees for loans taken by its subsidiaries and associate company from banks and financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions on which the Company has given guarantees for loans taken from banks and financial institutions are not, prima-facie, prejudicial to the interest of the Company.

xvi According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

xvii According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investments.

xviii According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies/frms covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause (xviii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xix the Company has not issued unsecured debentures during the year under audit. Accordingly, the provisions of clause (xix) of paragraph 4 of the aforesaid order are not applicable to the Company.

xx We have verifed the end use of money raised by the rights issue of equity shares as disclosed in Note 3 of Notes to the Accounts (schedule 24).

xxi during the course of our audit of the books of accounts of the Company, we have neither come across any instance of fraud on or by the Company nor have we been informed of any such case by the Management.



For RAY & RAY

Chartered Accountants

A. K. sharma

Partner

Gurgaon Membership Number 80085

30th May, 2011 Firms registration Number 301072E


Mar 31, 2010

1. We have audited the attached Balance sheet of eiH LiMited ("the Company") as at 31st March, 2010, the proft and Loss Account and also the Cash Flow statement for the year ended on that date annexed thereto. these Financial statements are the responsibility of the Companys Management. our responsibility is to express an opinion on these Financial statements based on our audit.

2. We conducted our audit in accordance with the 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 signifcant 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 (Auditors report) order, 2003, as amended by the Companies (Auditors report Amendment) order, 2004, issued by the Central Government of india in terms of sub-section (4A) of section 227 of the Companies Act 1956 (‘the Act), and, on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specifed in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

ii) 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;

iii) The Balance sheet, proft and Loss Account and Cash Flow statement dealt with by this report are in agreement with the books of account;

iv) In our opinion, the Balance sheet, proft and Loss Account and Cash Flow statement dealt with by this report comply with the Accounting standards referred to in sub-section (3C) of section 211 of the Act;

v) on the basis of written representations received from the directors as on 31st March, 2010 and taken on record by the Board of directors, we report that none of the directors is disqualifed as on 31st March, 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act;

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with schedules 1 to 23 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 31st March, 2010;

b) In the case of the proft and Loss Account, of the proft for the year ended on that date; and

c) In the case of the Cash Flow statement, of the cash fows for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT (referred to in paragraph 3 of our report of even date)

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

(b) All the assets have not been physically verifed by the Management during the year but there is a regular programme of verifcation which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. the discrepancies noticed on such verifcation are being reconciled.

(c) During the year the Company has not disposed off any substantial part of its fxed assets, which could affect its continuation as a going concern.

ii. (a) The inventory has been physically verifed by the Management during the year. in our opinion, the frequency of verifcation is reasonable.

(b) In our opinion, the procedures of 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) The Company is maintaining proper records of inventory. the discrepancies noticed on verifcation between the physical stocks and the book records were not material.

iii. (a) The Company has not granted any loans, secured or unsecured, to companies, frms or other parties covered in the register maintained under section 301 of the Act.

(b) In view of our comments in paragraph iii(a) above, the provisions of Clauses iii(b), iii(c) and iii(d) of paragraph 4 of the aforesaid order are not applicable to the Company.

(c) The Company has not taken any loan, secured or unsecured, from companies, frms or other parties covered in the register maintained under section 301 of the Act.

(d) In view of our comment in paragraph iii(c) above, clauses iii(f), iii(g) of paragraph 4 of the aforesaid order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fxed assets and with regard to the sale of goods and services. Further, there is no continuing failure to correct major weaknesses in internal control system.

v. on the basis of our examination of the books of account and according to the information and explanations given to us, the Company has not entered into any transaction during the year that need to be entered into the register maintained under section 301 of the Act and therefore clauses v(a) and v(b) of paragraph 4 of the aforesaid order are not applicable to the Company.

vi. The Company has not accepted any deposit from the public during the year under sections 58A and 58AA of the Act and the Companies (Acceptance of deposits) rules, 1975.

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

viii. The Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Act for the Company.

ix. (a) The Company is generally regular in depositing with appropriate authorities 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 applicable to it.

(b) According to the information and explanations given to us, there are no undisputed amounts payable in respect of income tax, wealth tax, service tax, sales tax, customs duty, excise duty and cess which were outstanding as at 31st March, 2010 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of wealth tax, service tax and cess which have not been deposited on account of any dispute other than disputed income tax, sales tax, customs duty, excise duty and employees state insurance as indicated below:

Sl.No. Name of the Statute Nature of Forum where Amount

the dues dispute is (Rupees in

pending Million)

1. income tax income tax Cit (Appeals) for

Act, 1961 Assessment Years 2000-01,

2002-03, 2006-07 & 2007-08 142.82

itAt, Kolkata for

Assessment Years 2002-03,

2003-04, 2004-05 & 2005-06 429.25

Total 572.07

2. sales tax Acts of sales tax Maharashtra sales tax various states tribunal, Mumbai for

1999-2000 to 2004-05 15.26

Commercial taxes Appellate &

revisional Board, Kolkata for

2000-01, 2001-02 & 2004-05 4.27

deputy Commissioner of

Commercial taxes,

Kolkata

for 2004-05 1.15

sr. Jt. Commissioner of

Commercial taxes, Kolkata for 2005-06 1.38

Commercial tax offcer,

Chennai for 2005-06 2.58

Total 24.64

3. Customs Act, 1962 Customs Commissioner of Customs

duty (Appeals) for 2008-09 452.50

4. Central excise excise duty Customs, excise & service tax Act, 1944 Appellate tribunal for 2009-10 19.49

5. employees state employees esiC Court for 1992-93,

insurance Act, 1948 state 2004-05 & 2005-06 11.12

insurance

x. The Company has no accumulated losses and has not incurred any cash loss during the year covered by our report and the immediately preceding fnancial year.

xi. Based on our audit procedures and, according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to fnancial institutions, banks or debenture holders.

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

xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. therefore, the provisions of clause (xiii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xiv. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause (xiv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xv. The Company has given guarantees for loans taken by its subsidiaries and associate company from banks and financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions on which the Company has given guarantees for loans taken from banks and financial institutions are not, prima-facie, prejudicial to the interest of the Company.

xvi. According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

xvii. According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investments.

xviii. The Company has not raised any money by issue of shares during the year. therefore, the provisions of clause (xviii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xix. The Company has not issued unsecured debentures during the year under audit. Accordingly, the provisions of clause (xix) of paragraph 4 of the aforesaid order are not applicable to the Company.

xx. The Company has not raised any money by way of public issue during the year. therefore, the provisions of clause (xx) of paragraph 4 of the aforesaid order are not applicable to the Company.

xxi. During the course of our examination of the books of account carried out in accordance with Generally Accepted Auditing practices, we have neither come across any instance of material fraud on or by the Company noticed or reported nor have we been informed of any such case by the Management.

For RAY RAY Chartered ccountants A.K . sharma Partner Mumbai Membership Number 80085 28th May,2010 Firm ’sregistration Number 01072E

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