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Auditor Report of Engineers India Ltd.

Mar 31, 2016

We have audited the accompanying standalone financial statements of ENGINEERS INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at 31 March, 2016, the Statement of Profit and Loss and 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

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

Auditor''s Responsibility

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

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

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 control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of 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.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to the note no. 2.47 to the standalone financial statements for the year ended 31 March 2016, regarding:

(a) fraud committed by M/s Fernas Construction India Pvt. Ltd. (''the Contractor'') by submitting bogus completion certificate. Further, the employees and officers of the Company in connivance with the contractor relaxed the bid qualification criteria to enable the contractor to qualify and beg the tender/contract worth Rs.180000 lakhs from a client for whom the Company is a consultant. The management does not envisage any financial liability in this regard.

(b) fraud committed by M/s Fernas Construction India Pvt. Ltd. (''the Contractor'') by submitting bogus completion certificate for qualifying in the bid criteria and beg the tender/contract of approximate Rs.27200 lakhs. The Company has terminated the contract. The Company has estimated additional expenditure of Rs.3167 lakhs to complete the job, which has been accounted for as per accounting standard (AS—7 ''Accounting for Construction Contracts''). Subsequent to termination of contract, the contractor raised the claim against the Company. Management does not consider any possible obligation on this account requiring future probable outflow of resources.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Sub- section (11) of section 143 of the Act, we give in the "Annexure A", a statement on the matters specified in the paragraph 3 and 4 of the Order.

2. The C&AG of India has issued directions indicating the areas to be examined in terms of sub section (5) of section 143 of the Companies Act 2013, compliance of which are set out in "Annexure B"

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

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

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

(c) The balance sheet, the statement of profit and loss, and the cash flow statement dealt with by this Report are in agreement with the books of account.

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

(e) On the basis of the written representations received from the Directors as on 31 March, 2016 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) 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 C"; and

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

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer note no. 2.18 to the financial statements;

ii. The Company 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 - Refer note no. 2.45 to the financial statements;

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

Annexure A to Independent Auditors'' Report

Referred to Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date

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

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

(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) (a) The Company has carried out a physical verification of inventory at the year end. In our opinion, frequency of physical 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 are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. Further, as per the information and explanations given to us, the discrepancies noticed on physical verification of inventories as compared to book records were not material and the same have been dealt with in the books of account.

(iii) In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Accordingly paragraphs 3 (iii) (a), (b) and (c) of the order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.

(v) The Company has not accepted any deposits from the public.

(vi) As per the information and explanations given to us, the maintenance of cost records has not been prescribed by the Central Government under section 148(1) of the Companies Act, 2013 for services rendered by the Company.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, amount deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Income Tax, Sales tax, Service Tax, Custom Duty, Value Added Tax, Cess and any other statutory dues have been regularly deposited during the year by the Company with appropriate authorities. As explained to us, the Company did not have any dues on account of employees'' state insurance and duty of excise.

According to the information and explanation given to us and on the basis of our examination of the books of accounts, no undisputed amounts payable in respect of Provident Fund, Income Tax, Sales tax, Service Tax, Custom Duty, Value Added Tax, Cess and any other statutory dues were in arrears as at 31 March 2016 for a period 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, service tax have not been deposited by the Company on account of disputes:

Sl. Name of Statue Nature of dues Forum where dispute No. is pending

1. Income Tax Act, 1961 Income Tax CIT (Appeals)

2. Income Tax Act, 1961 TDS Under section 201(1) CIT (Appeals)

3. Income Tax Act, 1961 Interest Supreme Court

4. Income Tax Act, 1961 Income Tax Appellate Tribunals

5. Finance Act, 1994 Service Tax CESTAT and Service Tax Laws

6. Sales Tax Sales Tax Sales Tax Tribunal Agra

7. Sales Tax Entry Tax Sales Tax Tribunal Agra

Name of Statute Period to which amount relates Amount (Rs. in lakhs)

Income Tax Act, 1961 2011-12, 2012-13 133.04

Income Tax Act, 1961 2008-09 0.32

Income Tax Act, 1961 2005-06 105.37

Income Tax Act, 1961 2001-02, 2003-04,2009-10,2010-11 363.37

Finance Act, 1994 01.04.2002 to 17.04.2006 62.87

Sales Tax 1999-00, 2000-01 248.65

Sales Tax 1999-00 13.70

(viii) The Company does not have any loan or borrowings from any financial institution, bank, government or debenture holders during the year. Accordingly, paragraph 3(viii) of the order is not applicable.

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

(x) According to the information and explanation given to us by the management, a fraud was committed by employees and officers of the Company by relaxing the bid qualification criteria in connivance with the bidding contractor and helping him to qualify and beg the tenders/ contracts worth Rs.180000 lakhs from clients for whom company is a consultant. The management does not envisage any financial liabilities in this regard. (Refer note no. 2.47 (a) to the standalone financial statements).

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

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

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

For Arun K Agarwal & Associates

Chartered Accountants

(Firm''s Registration No. 003917N)

Arun Agarwal

Date: 25/05/2016 (Partner)

Place: Delhi M.No:082899


Mar 31, 2015

Report on the Standalone Financial Statements

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

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 control, 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

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2015;

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, 2015 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act 2013, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

2. The C & AG of India has issued direction indicating the areas to be examined in terms of sub section (5) of section 143 of the Companies Act 2013, compliance of which are set out in Annexure II

As required by section 143(3) of the Act, we report that:

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

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us

c) The Balance Sheet, the Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns received from the branches not visited by us.

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

e) On the basis of written representations received from the directors as on 31 March, 2015, 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. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Notes No 2.17 to the financial statements;

ii. The Company 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 - Refer Note No 2.43 to the financial statements;

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

Annexure I to the Independent Auditors' Report

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

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

(b) As explained to us, the fixed assets have been physically verified by the management in phased manner so as to cover each assets at once in three years which in our opinion is reasonable in regard to the size of the Company and the nature of its business. As informed to us, no material discrepancies were noticed on such verification.

(ii) (a) As explained to us, inventories have been physically verified during the year by the management. 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 inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) We are of the opinion that, the Company is maintaining proper records of inventory. Further as per information and explanations given to us the discrepancies noticed on physical verification of inventories as compared to book records were not material and the same have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act. Accordingly paragraphs (iii) (a) and (b) of the order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. On the basis of our examination and according to information and explanation given to us we have neither come across nor been informed of any instance of major weakness in the internal control system.

(v) The Company has not accepted any deposits from the public.

(vi) As per information and explanation provided to us, maintenance of cost record has not been prescribed under section 148 of the act for services rendered by the Company.

(vii) (a) As per information and explanations and records provided to us, the Company has been generally regular in depositing undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, duty of customs, value added tax, cess and other statutory dues with the appropriate authorities. We are informed that there are no undisputed statutory dues as at the year end outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us and on the basis of record verified by us , the following dues of income tax, sales tax, service tax, wealth-tax, duty of customs, duty of excise, value added tax and cess as at March 31, 2015 which have not been deposited on account of a dispute:

S. Name of Statute Nature of Duty Forum where the No. dispute is pending

1 Income Tax Assessment u/s 143(3) of CIT (Appeals) Act 1961 the Income Tax Act, 1961

2 Income Tax Demand of TDS u/s CIT (Appeals) Act 1961 201(1)

3 Income Tax Interest on Self assessment Supreme Court Act 1961 tax u/s 244A

4 Finance Act 1994 Demand of Service tax CESTAT

5 Sales Tax Act Demand of Sales Tax Sales Tax tribunal Agra

6 Sales Tax Act Demand of Sales Tax Sales Tax tribunal Agra

7 UP Sales Tax Act Sales Tax Sales Tax tribunal Agra

S. Name of Statute Financial Year to Amount No. which it pertains (Rs. in Lacs)

1 Income Tax Act 1961 2011-12 43.48

2 Income Tax Act 1961 2008-09 0.32

3 Income Tax Act 1961 2005-06 105.37

4 Finance Act 1994 2002-2006 62.87

5 Sales Tax Act 1999-2000 132.53

6 Sales Tax Act 2001-01 116.12

7 UP Sales Tax Act 1999-2000 13.70

(c) According to the information and explanations given to us, the amount which were required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund within time.

(viii) The Company does not have any accumulated losses as on 31.3.2015 and has not incurred cash losses during the year and in the immediately preceding financial year.

(ix) The Company do not have any borrowing from any financial institutions, banks or debenture holders.

(x) As per record and information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions except guarantee amounting to Rs.200.00lacs issued on behalf of M/s TEIL Projects Ltd (a joint venture company). In our opinion the terms and condition of the guarantee are not prejudicial to the interest of the Company.

(xi) Company has not availed any term loan during the year.

(xii) 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 M. Verma & Associates Chartered Accountants FRN:501433C

(Mohender Gandhi) Place: New Delhi (Partner) Date: May 27, 2015 M. Number: 088396


Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

2. Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the companies Act, 1956 ("the Act”) read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Charted 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.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

b) In the case of the Profit and Loss Account, of the profit of 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 Regularity Requirement

7. As required by the Companies (Auditor''s Report) Order, 2003, as amended by the Companies (Auditor''s report) (Amendment) Order 2004 ("the Order”), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

b) In our opinion proper books of account as required by the law have been kept by the Company so far as appears from our examination of those books [and proper returns adequate for the purposes of our audit have been received from sites not visited by us];

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 [and with the returns received from sites not visited by us];

d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of Section 211 of the Companies Act,1956 read with the General Circular 15/2013 dtd September 13th , 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act 2013;

e) In terms of notification No. G.S.R. 829(E) dt. 21.10.2003, issued by Ministry of Finance, Department of Company Affairs, Government of India, clause(g) of sub-section(I) of Section 274 of the Companies Act,1956 is not applicable to Government Company.

Annexure to the Auditors'' Report referred to in paragraph (7) of our report of even date on the accounts of Engineers India Limited for the year ended on 31st march, 2014

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

(b) As explained to us, the fixed assets have been physically verified by the management at phased manner so as to cover each asset at least once in three years which, in our opinion is reasonable having regard to the size of the company and the nature of its business. As informed to us, no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, the disposal of assets during the year was not substantial and would not have an impact on the operations of the company.

(ii) (a) As explained to us, the inventories have been physically verified during the year by the management. 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 are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) We are of the opinion that, the Company is maintaining proper records of inventories. Further as per information and explanations provided to us, 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) (a) According to the information and explanations given to us, the Company has, during the year, not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (a),(b), (c) and (d) of the Order, are not applicable.

(b) According to the information and explanations given to us, the Company has, during the year, not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii)(e),(f), and (g) of the Order, are not applicable

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets for the sale of goods and services. During the course of our audit, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered in to the register maintained under section 301 of the companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, as there are no transactions that need to be entered in to the register maintained under section 301 of the companies Act, 1956, paragraph 4 (v) (b) of the Order, is not applicable.

(vi) The company has not accepted any deposits from the public within the meaning of section 58A, 58AA and other relevant provisions of the Companies Act 1956 and the rules framed there under and hence provisions of paragraph 4 (vi) of the Order, is not applicable.

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

However in our opinion the procedure for IT system Audit at periodic intervals from outside expert agency need to be strengthen. As per information provided to us company has already initiated the process and job of IT system Audit has already been entrusted to outside expert agency.

(viii) As per information and record provided to us the company is maintaining cost record for its two operating segments viz. Consultancy and engineering projects and turnkey projects as prescribed under section 209(1)(d) of the Companies Act 1956 depicting Cost and Revenue for each job. We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the central government for the maintenance of Cost record 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.

(ix) (a) As per information and explanation and record provided to us, the company has been generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, Cess and other applicable statutory dues with the appropriate authorities during the year. We are informed that there are no undisputed statutory dues as at the year end outstanding for a period of more than 6 months from the date they become payable.

(b) According to the information and explanations given to us and based on records of the company, there are no dues outstanding on account of Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess on account of any dispute, other than the following-

Name of Statute Nature of Dues Amount Period to which Forum where the (in lakhs) amount relates dispute is pending

Uttar Pradesh Sales Tax Act Demand of Sales Tax 13.70 1999-2000 Sales Tax Tribunal, Agra

Service Tax Act 1994 Demand of Service Tax 62.87 2002-2006 Custom, Excise and Service Tax (including penalty of Rs 31.44) Appellate Tribunal

Income Tax Act 1961 Demand of TDS u/s 201(1) 0.32 2008-2009 Commissioner of Income Tax (Appeals)

Income Tax Act 1961 Demand of Income Tax U/s 143(3) 50.82 2010-2011 Commissioner of Income Tax (Appeals)

Uttar Pradesh Sales Tax Act Demand of Sales Tax 132.53 1999-2000 Commissioner (Appeals) Mathura

116.12 2000-2001

(x) The Company does not have accumulated losses as at the year ended March 31, 2014. Further, the Company has not incurred any cash losses during the year ended March 31, 2014 and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and on the basis of information and explanations given to us, the Company has not defaulted in repayment of dues to banks, Financial Institutions during the year. The Company has not issued debentures during the year.

(xii) As the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities, paragraph 4(xii) of the Order is not applicable.

(xiii) As the Company is not a chit fund/nidhi/mutual benefit funds/ society to which the provisions of special statute relating to chit fund are applicable, paragraph 4(xiii) of the Order is not applicable.

(xiv) As the Company is not dealing or trading in shares, securities, debentures and other investments, paragraph 4 (xiv) of the Order is not applicable.

(xv) As per record and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year except guarantees amounting to Rs 1000 lacs and Rs 200 lacs issued on behalf of M/s Certification Engineers International Limited (a wholly owned subsidiary company) and TEIL Projects Ltd (a joint venture company) respectively. In our opinion the terms and conditions of the guarantee are not prejudicial to the interest of the Company.

(xvi) According to the in information and explanations given to us, the company has not raised any term loan during the year.

(xvii) According to the in information and explanations given to us, and on an overall examination of the balance sheet of the company, we report that short term funds have not been used to finance long term investments.

(xviii) During the year the company has not made any preferential allotment of shares to parties or companies covered in the Register maintained under section 301 of the Companies Act, 1956.

(xix) The company has not issued any debentures during the year.

(xx) The company has not raised any money by way of public issue during the year.

(xxi) To the best of our knowledge and belief and according to the information and explanations given by the management, and the records of the company examined by us , no fraud on or by the company was noticed or reported during the year.

For M. Verma & Associates Chartered Accountants

(Madan Verma)

(Partner)

Place: New Delhi

Membership no. 080939

Date : May 23, 2014 Firm Registration no. 501433C


Mar 31, 2013

1. We have audited the accompanying financial statements of ENGINEERS INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 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.

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

3. 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.

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

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

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

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

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.

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

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

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

b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books [and proper returns adequate for the purposes of our audit have been received from sites not visited by us];

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 [and with the returns received from sites not visited by us];

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

e) In terms of notification No. G.S.R. 829(E) dt. 21.10.2003, issued by Ministry of Finance, Department of Company Affairs, Government of India, clause(g) of sub-section(1) of274 of the Companies Act,1956 is not applicable to Government Company.

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

ANNEXURE TO THE AUDITORS'' REPORT REFERRED TO IN PARAGRAPH (7) OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF ENGINEERS INDIA LIMITED FOR THE YEAR ENDED ON 31st MARCH, 2013

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

(b) As explained to us, the fixed assets have been physically verified by the management at phased manner so as to cover each asset at least once in a three years which, in our opinion is reasonable having regard to the size of the company and the nature of its business. As informed to us, no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, the disposal of assets during the year was not substantial and would not have an impact on the operations of the company.

(ii) (a) As explained to us, the inventories have been physically verified during the year by the management. 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 are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) We are of the opinion that, the Company is maintaining proper records of inventories. Further as per information and explanations provided to us, 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) (a) According to the information and explanations given to us, the Company has, during the year, not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act 1956. Accordingly, paragraphs 4(iii) (a), (b), (c) and (d) of the Order, are not applicable.

(b) According to the information and explanations given to us, the Company has, during the year, not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies act, 1956. Accordingly, paragraphs 4 (iii) (e), (f) and (g) of the Order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets for the sale of goods & services. During the course of our audit, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, as there are no transactions that need to be entered into the Register maintained under Section 301 of the Companies Act, 1956, paragraph 4(v)(b) of the Order is not applicable.

(vi) The Company has not accepted any deposits from the public within the meaning of Section 58A, 58AA and other relevant provisions of the Companies Act, 1956 and the rules framed there under and hence provisions of paragraph 4(vi) of the Order is not applicable.

(vii) In our opinion, the Company has an adequate internal audit system commensurate with the size of the Company and nature of its business. However in our opinion the procedure for IT System Audit at periodic intervals from outside expert agency need to be strengthen.

(viii) As per information and record provided to us the Company is maintaining cost record for its two operating segments viz. Consultancy and Engineering Projects and Turnkey projects as prescribed under section 209 (1)(d) of the Companies Act 1956 depicting cost and revenue for each job. We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost record 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.

(ix) (a) As per information and explanation and record provided to us, the company has been generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other applicable statutory dues with the appropriate authorities during the year. We are informed that there are no undisputed statutory dues as at the year end outstanding for a period of more than 6 months from the date they become payable.

(b) According to the information and explanations given to us and based on records of the company, there are no dues outstanding on account of Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess on account of any dispute, other than the following-

Name of Nature of Amount (Rs. Statute Dues in Lakhs

Uttar Pradesh Demand of 15.04 Sales Tax Sales Tax Act

Service Tax Demand of 62.87 Act 1994 Service Tax (including penalty of Rs. 31.44)

Income Tax Demand of 0.32 Act 1961 TDS U/s 201(1)

Income Tax Demand of 32.26 Act 1961 Income Tax U/s 143 (3)

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

Uttar Pradesh Sales Tax Act 1999-2000 Matter referred back to Assessing Authority Mathura by Sales Tax Tribunal Mathura

Service Tax Act 1994 2002-2006 Custom Excise and Service Tax Appellate Tribunal

Income Tax Act 1961 2008-2009 Commissioner of Income Tax (Appeals)

Income Tax Act 1961 2009-2010 Commissioner of Income Tax (Appeals)

(x) The Company does not have accumulated losses as at the year ended March 31, 2013. Further, the Company has not incurred any cash losses during the year ended March 31, 2013 and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and on the basis of information and explanations given to us, the Company has not defaulted in repayment of dues to banks, financial institutions during the year. The Company has not issued debentures during the year.

(xii) As the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities, paragraph 4(xii) of the Order is not applicable.

(xiii) As the Company is not a chit fund / nidhi / mutual benefit funds / society to which the provisions of special statute relating to chit fund are applicable, paragraph 4(xiii) of the Order is not applicable.

(xiv) As the Company is not dealing or trading in shares, securities, debentures and other investments, paragraph 4(xiv) of the Order is not applicable.

(xv) As per record and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year except a guarantee amounting to Rs 1000.00 lacs issued on behalf of M/s Certification Engineers International Limited a wholly owned subsidiary company. In our opinion the terms and condition of the guarantee are not prejudicial to the interest of the Company.

(xvi) According to the information and explanations given to us, the company has not raised any term loan during the year.

(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 short term funds have not been used to finance long term investments.

(xviii) During the year the company has not made any preferential allotment of shares to parties or companies covered in the Register maintained under section 301 of the Companies Act, 1956.

(xix) The company has not issued any debentures during the year.

(xx) The company has not raised any money by way of public issue during the year.

(xxi) To the best of our knowledge and belief and according to the information and explanations given by the management, and the records of the company examined by us, no fraud on or by the company was noticed or reported during the year.

For M. Verma & Associates

Chartered Accountants

(Mohender Gandhi)

Partner

Place : New Delhi Membership Number-088396

Date : May 28, 2013 Firm Registration No. 501433C


Mar 31, 2012

1. We have audited the attached Balance Sheet of Engineers India Limited as at 31st March, 2012, the Profit & Loss Account and also 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 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

4. Further to our comments in the Annexure referred to in paragraph 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 purpose of our audit;

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

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

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

e) In terms of notification No. G.S.R. 829 (E) dt. 21.10.2003, issued by the Ministry of Finance, Department of Company Affairs, Government of India, clause (g) of sub-section (I) of section 274 of the Companies Act, 1956 is not applicable to Government Companies;

In our opinion and to the best of our information and according to the explanation given to us, the said accounts read together with significant Accounting Policies and Notes to Accounts (Notes No. 1 & 2) 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:-

a) In the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2012;

b) In the case of Profit & Loss Account, of the profit of the Company for the year ended on that date; and

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

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

(b) As explained to us, the fixed assets have been physically verified by the management at phased manner so as to cover each asset at least once in three years which, in our opinion, is reasonable having regard to the size of the company and the nature of its business. As informed to us, no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, the disposal of assets during the year was not substantial and would not have an impact on the operations of the company.

(ii) (a) As explained to us, the inventories have been physically verified during the year by the management. 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 are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) We are of the opinion that, the Company is maintaining proper records of inventories. Further as per information and explanations provided to us, 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) (a) According to the information and explanations given to us, the Company has, during the year, not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act,1956. Accordingly, paragraphs 4(iii) (a), (b), (c) and (d) of the Order, are not applicable.

(b) According to the information and explanations given to us, the Company has, during the year, not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (e), (f) and (g) of the Order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets for the sale of goods & services. During the course of our audit, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control system.

(v ) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, as there are no transactions that need to be entered into the Register maintained under Section 301 of the Companies Act, 1956, paragraph 4(v)(b) of the Order is not applicable.

(vi) The Company has not accepted any deposits from the public within the meaning of Section 58A, 58AA and other relevant provisions of the Companies Act, 1956 and the rules framed thereunder and hence provisions of paragraph 4(vi) of the Order is not applicable.

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

(viii) According to the information given to us by the Management the Central Government has not prescribed the maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956 for the activities of the Company.

(ix) (a) As per information, explanation and record provided to us, the Company has been generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other applicable statutory dues with the appropriate authorities during the year. We are informed that there are no undisputed statutory dues as at the year end outstanding for a period of more than 6 months from the date they become payable.

(b) According to the information and explanations given to us and based on records of the company, there are no dues outstanding on account of income tax, sales tax, wealth tax, service tax, custom duty, excise duty and cess on account of any dispute, other than the following:-

Name of the Nature of Amount Period to which Forum where the statute Dues (In Lakhs) the amount relates dispute is pending

Service Tax Act Demand of Service Tax 62.87 2002-2006 Commissioner 1994 (excluding interest, including of Central Excise penalty of Rs. 31.44 Lakhs) (Appeals)

Service Tax Act Demand of 1.58 1997-1998 Commissioner of 1994 Service Tax Central Excise (Appeals)

Income Tax Act Demand of 2.55 2008-2009 Commissioner of 1961 TDS Income Tax (Appeals)

Income Tax Act Demand of Income 11.61 2008-2009 Commissioner of 1961 Tax U/s 143(3) Income Tax (Appeals)

Uttar Pradesh Demand of 15.04 1999-2000 Sales Tax Tribunal, Sales Tax Act Sales Tax Agra

(x) The Company does not have accumulated losses as at the year ended March 31, 2012. Further, the Company has not incurred any cash losses during the year ended March 31, 2012 and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and on the basis of information and explanations given to us, the Company has not defaulted in repayment of dues to banks, financial institutions during the year. The Company has not issued debentures during the year.

(xii) As the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities, paragraph 4(xii) of the Order is not applicable.

(xiii) As the Company is not a chit fund / nidhi / mutual benefit funds / society to which the provisions of special statute relating to chit fund are applicable, paragraph 4(xiii) of the Order is not applicable.

(xiv) As the Company is not dealing or trading in shares, securities, debentures and other investments, paragraph 4(xiv) of the Order is not applicable.

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

(xvi) According to the information and explanations given to us, the company has not raised any term loan during the year.

(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 short term funds have not been used to finance long term investments.

(xviii) During the year the company has not made any preferential allotment of shares to parties or companies covered in the Register maintained under section 301 of the Companies Act, 1956.

(xix) The company has not issued any debentures during the year.

(xx) The company has not raised any money by way of public issue during the year.

(xxi) To the best of our knowledge and belief and according to the information and explanations given by the management, and the records of the company examined by us, no fraud on or by the company was noticed or reported during the year. For M Verma & Associates,

Chartered Accountants

(Mohender Gandhi)

Partner

Membership No. 088396

Firm Registration No. 501433C

Place : New Delhi

Date : May 28, 2012


Mar 31, 2010

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

2. We conducted our audit in accordance with 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

4. Further to our comments in the Annexure referred to in paragraph 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 purpose of our audit;

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

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

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

e) In terms of notification No. G.S.R. 829 (E) dt. 21.10.2003, issued by the Ministry of Finance, Department of Company Affairs, Government of India, clause (g) of sub-section (I) of section 274 of the Companies Act, 1956 is not applicable to Government Companies;

In our opinion and to the best of our information and according to the explanation given to us, the said accounts read together with significant Accounting Policies as per Schedule `I and Notes as per Schedule `J 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:- a) In the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2010;

b) In the case of Profit & Loss Account, of the profit of the Company for the year ended on that date; and

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

Annexure to the Auditors Report Referred to in Paragraph (3) of our Report of Even Date on the Accounts of Engineers India Limited for the year ended on 31st March, 2010

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

(b) As informed to us, the fixed assets are verified by the management in a phased manner so as to cover each asset at least once in three years which, in our opinion, is reasonable having regard to the size of the company and the nature of its business. As informed, no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets have not been disposed off by the company during the year.

(ii) (a) As explained to us, the inventories have been physically verified during the year by the management. 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 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 record 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) (a) According to the information and explanations given to us, the Company has, during the year, not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act,1956. Accordingly, paragraphs 4(iii) (a), (b), (c) and (d) of the Order, are not applicable. (b) According to the information and explanations given to us, the Company has, during the year, not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (e), (f) and (g) of the Order, are not applicable. (iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets for the sale of goods & services. During the course of our audit, we have neither come across nor have been informed of any instance of major weakness in the aforesaid internal control system. (v) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956. (b) In our opinion and according to the information and explanations given to us, as there are no transactions that need to be entered into the Register maintained under Section 301 of the Companies Act, 1956, paragraph 4(v)(b) of the Order is not applicable. (vi) The Company has not accepted any deposits from the public within the meaning of Section 58A, 58AA and other relevant provisions of the Companies Act, 1956 and the rules framed thereunder and hence provisions of paragraph 4(vi) of the Order is not applicable. (vii) In our opinion, the Company has an adequate internal audit system commensurate with the size of the

Company and nature of its business. (viii) According to the information given to us by the Management the Central Government has not prescribed the maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956 for the activities of the investor education and protection fund, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other applicable statutory dues with the appropriate authorities during the year. We are informed that there are no undisputed statutory dues as at the year end outstanding for a period of more than 6 months from the date they become payable. (b) According to the information and explanations given to us and based on records of the company, there are no dues in respect of income tax, sales tax, wealth tax, service tax, custom duty, excise duty and cess which have not been deposited on account of any dispute except the following:-

Particulars Year Amount (Rs. In Lakhs) Forum

Service Tax 01.4.2002 To 17.4.2006 31.44 Commissioner of Central Excise (Appeals)

Service Tax 1997-98 1.58 Commissioner of Central Excise (Appeals)

(x) The Company does not have accumulated losses as at the year ended March 31, 2010. Further, the Company has not incurred any cash losses during the year ended March 31, 2010 and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and on the information and explanations given to us, the Company has not defaulted in repayment of dues to banks, financial institutions during the year. The Company has not issued debentures during the year.

(xii) As the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities, paragraph 4(xii) of the Order is not applicable.

(xiii) As the Company is not a chit fund / nidhi / mutual benefit funds / society to which the provisions of special statute relating to chit fund are applicable, paragraph 4(xiii) of the Order is not applicable.

(xiv) As the Company is not dealing or trading in shares, securities, debentures and other investments, paragraph 4(xiv) of the Order is not applicable.

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

(xvi) According to the information and explanations given to us, the company has not raised any term loan during the year.

(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 short term funds have not been used to finance long term investments.

(xviii)During the year the company has not made any preferential allotment of shares to parties or companies covered in the Register maintained under section 301 of the Companies Act, 1956.

(xix) The company has not issued any debentures during the year.

(xx) The company has not raised any money by way of public issue during the year.

(xxi) Based upon the audit procedures performed and information and explanations given by the management, we report that, no fraud on or by the company has been noticed or reported during the course of our audit for the year ended March 31, 2010.

For JAGDISH CHAND & CO.

CHARTERED ACCOUNTANTS

(JAGDISH CHAND GUPTA)

PARTNER

M.NO. 006107

Firm Registration No. 000129N

Place : New Delhi

Dated : May 27, 2010

 
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