Auditor Report of i Power Solutions India Ltd.

Mar 31, 2010

I have audited the attached Balance sheet of i Power Solutions India Limited as at 31st March 2010 also the Profit and Loss account of the Company for the Year ended on that date both annexed thereto. These Financial statements are the responsibility of the management. My responsibility is to express an opinion on these financial statements based on my audit.

I conduct the audit in accordance with the Auditing Standards generally accepted in India. Those Standards require that I 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 and supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statements presentation. I believe that my audit provides a reasonable basis for my opinion.

1. As required by the Manufacturing and other companies Auditors report order 1988, issued by the company law board in terms of section 227 (4A) of the companies act,1956,1 enclose in the annexure a statement on the matters specified in paragraph 4 & 5 of the said order.

2. Further to comments in the annexure referred to in paragraph 1 above, I report that:

(i) I have obtained all the information and explanations which to the best of my knowledge and belief Ire necessary for the purpose of my audit.

(ii) In My opinion proper books of accounts as required by law have been kept by the company so far as it appears from my examination of such books.

(iii) The Balance sheet and Profit and loss account and Cash Flow Statement referred in to this report are in agreement with the books of account.

(iv) In My opinion, the Balance sheet, Profit and loss account and Cash flow statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211 (3c) of the Companies Act, 1956

(v) On the basis of information and explanations given to me, none of the directors of the company is prima facie, as at 31st March 2010 disqualified from being appointed as a Director of the company under Section 274(1) (g) of the Companies Act, 1956

(vi) In My opinion and to the best of My information and according the explanations given to me the said Balance sheet and Profit and Loss account read together with the notes therein, give the information required by the companies act, 1956, in the manner so required and give a true and fair view :

(a) In so far it relates to the Balance Sheet of the state of affairs of the company as at 31st March 2010

and

(b) In so far as it relates to the Profit and Loss account, of the Profit of the company for the Year ended on that date.

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

ANNEXURES TO THE AUDITORS REPORT (Referred to in Paragraph 3 of my Report of Even Date)

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

i (b) As explained to me, physical verification of a major portion of fixed assets as at March 2010 was conducted by the Management during the year. In my opinion, the frequency of verification is reasonable. Having regard to the size of the operations of the company and on the basis of explanations received, in my opinion, the net difference found on physical verification were not significant.

ii. The Company has no inventories and therefore, the provisions of clause 4 (ii) of the Companies (Auditors Report) order, 2003 are not applicable to the company

iii. The Company has taken unsecured loans from other parties covered in the register maintained under section 301 of the Companies Act, 1956 and is not prima-facie prejudicial to the interest of the company.

iv. In my Opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchases of fixed assets and with regard to the sale of goods and services. During the course of my audit, I have not observed any major weakness in the internal controls.

v. (a) To the best of my knowledge and belief and according to the information and explanations given to me, I am of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered on the Register to be maintained under that section.

(b) Transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at that relevant time.

vi In my opinion and according to the information and explanations given to me, the company has not accepted deposits from the public during the year.

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

viii. According to the information and explanations given to me, the Central Government has not prescribed maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for any products of the company.

ix. According to the information and explanations given to me, no undisputed amount payable in respect of Income tax, Sales tax, Custom Duty, Excise Duty and cess were in arrears, as at March 2010 for a period of more than six months from the date they became payable.

x. In my opinion and according to the information and explanations given to me, the company has not borrowed any loan from Financial Institution or Bank, hence default in repayment of dues to financial institution or bank does not arise.

xi. In my opinion and according to the explanations and information given to me, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xii. In my opinion and according to the information and explanations given to me, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the CARO, 2003 are not applicable to the company.

xiii. In my opinion and according to the information and explanations given to me, the company has not given any guarantee, for loans taken by others from banks or financial institution; hence prima-facie prejudicial to the interest of the company does not arise.

xiv. In my opinion and according to the information and explanations given to me, the company has not taken any term loans and the purpose, hence the application of such loan for which they were raised does not arise.

xv. In my opinion and according to the information and explanations given to me, and on an overall examination of the balance sheet of the company, I report that no funds raised on short-term basis have been used for long-term investment.

xvi. To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on by the company has been noticed or reported during the course of my audit.

Clauses 4(xiii) and 4(xix) of the Companies (Auditors Report) order 2003 are not applicable to the Company.

Sd./-

W.S.MADHAVANN

Chartered Accountant

Membership No: 201067