Auditor Report of Jayavant Products Ltd.

Mar 31, 2012

1. We have audited the attached Balance Sheet of M/s. JAYAVANT PRODUCTS LIMITED (hereinafter referred to as "the company") as at 31st March 2012, the Statement of Profit and Loss and also Cash Flow Statement of the company for the year ended on that date annexed thereto. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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 Companies (Auditors' Report) Order 2003 (hereinafter referred to as "the CARO 2003"), issued by the Central Government of India in terms of the section 227 (4A) of the Companies Act, 1956 (hereinafter referred to as "the Act"), we give in the Annexure a statement on the matters specified in the paragraph 4 & 5 of the said order.

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

a. we have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the 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 the books;

c. the Balance Sheet, Statement of Profit & 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 mandatory accounting standards referred to in sub-section (3C) of Section 211 of the Act;

e. based on the written representation made by the directors of the company and information and explanation given to us, none of the directors is prima-facie disqualified as on 31st March, 2012, from being appointed as director in terms of clause (g) of sub section (1) of section 274 of the Act on the said date; and

f. As stated in Note no.18 to the Financial Statements:

Loans & Advances given by the company, to the extent of f 5, 14, 28,795.34 are in contraventions of Section 372A of the Act;

The possible impact of these non-compliances, in the event of condonation requests are not granted, has not been determined or recognized in the financial statements.

g. in our opinion and to the best of our information and according to the explanations given to us, the said accounts subject to our comments in paragraphs 4(f) above and the consequential impact thereof which are not quantifiable, read together with Significant Accounting Policies and notes on 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:

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

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

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

ANNEXURE REFERRED TO IN PARAGRAPH (3) OF AUDITORS' REPORT OF EVEN DATE ON THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH, 2012 OF JAYAVANT PRODUCTS LIMITED ON THE BASIS OF SUCH CHECKS AS WE CONSIDER APPROPRIATE AND IN TERMS OF THE INFORMATION AND EXPLANATION GIVEN TO US, WE STATE THAT: -

1. the company does not have any fixed assets, therefore the reporting requirement under clauses 4(i) (a), (b) & (c) of the CARO 2003 is not applicable to the company;

2. the company does not hold any inventory, therefore reporting requirement under clauses 4(ii) (a),(b) & (c) of the CARO 2003 is not applicable to the company;

3. the company has neither granted nor taken any loans, secured or unsecured, to/from companies, firms or other parties covered in the register maintained under section 301 of the Act. Accordingly the provisions of sub clauses (b),(c),(d),(f) and (g) of the clause 4(iii) of the Order are not applicable to the company;

4. on the basis of selective checks carried out during the course of audit and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weaknesses have been noticed in internal control system;

5. a) according to the information and explanation given to us, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act, have been entered in the register required to be maintained under that section; and

b) in our opinion and according to information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act and exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time where such market prices are available.

6. the company has not accepted any deposits from the public. Therefore the reporting requirement under provision of clause 4(vi) of the CARO 2003 is not applicable to the company;

7. the company is required to have an internal audit system as the company is listed at the recognized stock exchange and its paid up capital and reserves at the commencement of financial year exceeds X 50 lacs, however, the company, during the year, had no such internal audit system;

8. we have been informed that the Central Government has not prescribed the maintenance of cost records under Section 209 (1) (d) of the Act;

9. in respect of statutory dues:

a) according to the information and explanations given to us, the company has generally been regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues with the appropriate authorities as applicable to it. There are no arrears of undisputed statutory dues as at the last day of financial year concerned, outstanding for a period of more than six months from the date they became payable; and

b) according to the information and explanations given to us and books and records examined by us, there was no disputed dues in respect of sales tax, custom duty, wealth tax, excise duty, cess and income tax.

10. the company has no accumulated losses at the end of the financial year. The company has not incurred cash losses, both, in the financial year under report and also in the immediately preceding financial year.

11. as per the information and explanation given to us and based on documents and record produced to us, there were no dues payable to any financial institution, bank or debenture holders during the year, therefore reporting requirement under clause 4 (xi) of the CARO 2003 is not applicable to the company;

12. according to the information and explanation given to us and based on documents and record produced to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

13. in our opinion, the company is not a chit or a nidhi / mutual benefit fund or a society. Therefore reporting requirement under clause 4 (xiii) of the CARO 2003 is not applicable to the company;

14. in our opinion, the company is not dealing or trading in shares, securities, debentures and other investments. Therefore reporting requirement under clause 4 (xiv) of the CARO 2003 is not applicable to the company;

15. 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;

16. as per the records of the company, the company has not obtained any term loan during the year;

17. as per the information and explanation given to us and on the overall examinations of the financial statements of the company, we are of the opinion that funds raised on short-term basis have not been utilized for long-term investments;

18. during the year, the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act;

19. the company did not have any outstanding debenture during the year;

20. the company has not raised any money through a public issue during the year;

21. based on the audit procedures performed and the information and explanations given to us 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 and on behalf of

R. S. AGRAWAL & ASSOCIATES

Chartered Accountants

[Registration no. 100156W]

Anuja Dedhia Partner

M. No. 123589

Mumbai

30th May 2012

---

Mar 31, 2010

We have audited the attached Balance Sheet of M/s. JAYAVANT PRODUCTS LIMITED as at 31st March 2010, the Profit and Loss Account and also 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.

1. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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.

2. As required by Companies (Auditors Report) Order 2003 (hereinafter referred to as "the CARO 2003"), issued by the Central Government of India in terms of the section 227 (4A) of the Companies Act, 1956 (hereinafter referred to as "the Act"), we give in the annexure a statement on the matters specified in the paragraph 4 & 5 of the said order.

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

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

e. based on the written representation made by the directors of the Company and information and explanation given to us, none of the directors is prima-facie disqualified as on 31st March, 2010, from being appointed as director in terms of clause (g) of sub section (1) of section 274 of the Act on the said date; and

f. in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the significant accounting policies and notes thereon in schedule 11 and 12 respectively give the information required by the Act, in the manner so required and subject to :

1) loans and advances amounting to Rs. 62938198/- given by the Company are in contraventions of Section 295 of the Act; and

2) Loans & Advances given by the Company, to the extent of Rs. 46854396/- are in contraventions of Section 372A of the Act; give a true and fair view in conformity with the accounting principles generally accepted in India:

i) in case of Balance Sheet, of the state of affairs of the company as at 31st March, 2010;

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

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

ANNEXURE TO THE AUDITORS REPORT

ANNEXURE REFERRED IN PARAGRAPH (2) OF AUDITORS REPORT OF EVEN DATE ON THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH, 2010 OF JAYAVANT PRODUCTS LIMITED ON THE BASIS OF SUCH CHECKS AS WE CONSIDER APPROPRIATE AND IN TERMS OF THE INFORMATION AND EXPLANATION GIVEN TO US, WE STATE THAT: -

1. the company does not have any fixed assets, therefore the reporting requirement under clauses 4(i) (a), (b) & (c) of the CARO 2003 is not applicable to the company;

2. the company does not hold any inventory, therefore reporting requirement under clauses 4(H) (a) (b) & (c) of the CARO 2003 is not applicable to the company;

3. according to information and explanation given to us:

a) the company has granted unsecured loan to the companies, firm and other parties covered in the register maintained under section 301 of the Act. The maximum amount involved during the period was Rs. 10.17 lacs to one party and year end balance was Rs. 133.33 lacs of such party;

b) since the aforesaid unsecured loans granted are free of interest, therefore to that extent the same is, prima facie, prejudicial to the interest of the company;

c) the receipt of the principal amount of the aforesaid unsecured loans granted, as informed to us, are on demand, therefore the same is considered to be regular;

d) as the receipt of aforesaid unsecured loans granted are on demand, as informed to us, therefore no amount has been considered overdue;

e) the company has taken unsecured loan from the companies, firm and other parties covered in the register maintained under section 301 of the Act. The maximum amount involved during the period was Rs. 5.03 lacs from two parties and year end balance was Rs. 9.00 lacs of such two parties;

f) the rate of interest, wherever applicable, and other terms and conditions are prima facie not prejudicial to the interest of the company; and

g) the payment of the principal amount and interest of the aforesaid unsecured loans taken, as informed to us, are on demand, therefore the same is considered to be regular.;

4. on the basis of selective checks carried out during the course of audit and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and nature of its business with regard to sale of services. During the course of our audit, no major weaknesses have been noticed in internal control system;

5. a) according to the information and explanation given to us, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act, have been entered in the register required to be maintained under that section; and

b) in our opinion and according to information and explanations given to us, there were no transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year. Therefore the reporting requirement under provision of clause 4 (v) (b) of the CARO 2003 is not applicable to the company;

6. the company has not accepted any deposits from the public. Therefore the reporting requirement under provision of clause 4(vi) of the CARO 2003 is not applicable to the Company;

7. the company does not have an internal audit system. However, as explained to us, the company has an internal check system commensurate with its size and nature of its business;

8. we have been informed that the Central Government has not prescribed the maintenance of cost records under Section 209 (1) (d) of the Act;

9. in respect of statutory dues:

a) according to the information and explanations given to us, the company has generally been regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues with the appropriate authorities as applicable to it. There are no arrears of undisputed statutory dues as at the last day of financial year concerned, outstanding for a period of more than six months from the date they became payable; and

b) according to the information and explanations given to us and books and records examined by us, there was no disputed dues in respect of sales tax, custom duty, wealth tax, excise duty, cess and income tax.

10. the company has no accumulated losses at the end of the financial year. The company has not incurred cash losses in the financial year under report but it has incurred cash losses in the immediately preceding financial year.

11. as per the information and explanation given to us and based on documents and record produced to us, there were no dues payable to any financial institution, bank or debenture holders during the year, therefore reporting requirement under clause 4 (xi) of the CARO 2003 is not applicable to the company;

12. according to the information and explanation given to us and based on documents and record produced to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

13. in our opinion, the company is not a chit or a nidhi / mutual benefit fund or a society. Therefore reporting requirement under clause 4 (xiii) of the CARO 2003 is not applicable to the company;

14. in our opinion, the company is not dealing or trading in shares, securities, debentures and other investments. Therefore reporting requirement under clause 4 (xiv) of the CARO 2003 is not applicable to the company;

15. 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;

16. as per the records of the company, the company has not obtained any term loan during the year;

17. as per the information and explanation given to us and on the overall examinations of the financial statements of the company, we are of the opinion that funds raised on short-term basis have not been utilized for long-term investments;

18. during the year, the company has not made any preferential aljojbrfljenti^pf shares to parties and companies covered in the register maintained under Section 301 of the Act; :

19. the company did not have any outstanding debenture during the year;

20. the company has not raised any money through a public issue during the year;

21. based on the audit procedures performed and the information and explanations given to us 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 and on behalf of

R. S. AGRAWAL & ASSOCIATES

Chartered Accountants (Registration no. 100156W)

R S AGRAWAL

Partner

M. No.033216

Mumbai

31st August 2010