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Auditor Report of Jet Airways (India) Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of JET AIRWAYS (INDIA) LIMITED ("the Company"), which comprise 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 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 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.

Auditors' 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 thereunder.

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 auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal 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, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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, of the state of affairs of the Company as at 31st March, 2015, and its loss and its cash flows for the year ended on that date.

Emphasis of Matters

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

a) Note 32 to the financial statements in respect of loan given to its wholly owned major subsidiary ("subsidiary company") of Rs. 209,412 lakhs (net of provision) as at 31st March 2015 (Rs. 196,392 lakhs as at 31st March 2014). The subsidiary company has a negative net-worth of Rs. 243,428 lakhs as at 31st March 2015 (Rs. 214,289 lakhs as at 31st March 2014). On a consideration of factors as explained in the note and based on recent valuation report, the Company has made a provision for doubtful loan of Rs. 22,739 lakhs so as to fairly reflect the recoverable amount of the loan. The assessment of remaining carrying amount of loan is critically dependent upon the achievement of the expected operating performance by the subsidiary company after implementation of the business plan as mentioned in the note.

b) Note 42 in the financial statements which indicate the preparation of financial statements of the Company on going concern basis for the reasons stated therein. The appropriateness of assumption of going concern is dependent upon realisation of the ongoing synergies from alliance with the Strategic Partner and/or the Company's ability to raise requisite finance/generate cash flows in future to meet its obligations, including financial support to its subsidiary companies.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

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

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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) The matters described in sub-paragraph (a) and (b) under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(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 in accordance with generally accepted accounting practice - Refer Note 29 A (b) to the financial statements;

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

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

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements' section of our report of even date)

(i) In respect of its fixed assets;

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

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us no material discrepancies were noticed on such verification.

(ii) In respect of its inventories;

a) As explained to us, the inventory has been physically verified during the year by the Management other than inventory lying with third parties. In our opinion, the frequency of verification is reasonable. In respect of inventory lying with third parties we have relied on the confirmations obtained by the Management from such entities.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification followed by the Management for stock lying with it were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

(iii) According to the information and explanations given to us, the Company has granted unsecured loans to its wholly owned subsidiaries covered in the Register maintained under Section 189 of the Companies Act, 2013. In respect of such loans:

a) The loan given in earlier years is interest free and incremental loans given during the year is interest bearing. The loans given in previous years and incremental loans given during the year is repayable in the financial year 2019-2020.

b) There is no overdue amount in excess of Rs. 1 lakh remaining outstanding as at the year end.

(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 nature of its business for the purchase of inventory and fixed assets and for the sale of services. Sale of goods is not a significant part of the Company's activity. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system.

(v) According to information and explanations given to us, the Company has not accepted any deposit during the year.

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

(vii) According to the information and explanations given to us, in respect of statutory dues:

a) Undisputed statutory dues, including provident fund, sales-tax, wealth tax, duty of customs, duty of excise, cess and any other material statutory dues, as applicable, have generally been regularly deposited with the appropriate authorities except in respect of value added tax, profession tax, employees' state insurance, income tax (tax deducted at source) and service tax, the delays ranged from one day to seven months.

There were no undisputed amounts payable in respect of provident fund, employee state insurance, sales tax, wealth tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues in arrears as at March 31, 2015 for a period of more than six months from the date they became payable except in respect of service tax (including interest) of Rs. 18,451 lakhs (since paid Rs. 7,558 lakhs) and profession tax of Rs. 0.06 lakhs.

b) According to the information and explanations given to us, there are no dues of sales tax, wealth tax, duty of customs, duty of excise, value added tax, and cess which have not been deposited on account of any dispute other than the following:

Name of statute Nature of Period to which the the dues amount relates

IATT Rules, 1989 IATT Interest 2003-04 & Penalty

Customs Act 1962 Custom Duty 2004-2005 to 2010-2011

Customs Act 1962 Custom Duty 2007-2008 to 2014-2015

Finance Act 1994 Service Tax 2003-2004 to 2005-2006

Finance Act 1994 Service Tax 2002-2003 to 2012-2013

Finance Act 1994 Service Tax 2002-2003 to 2013-2014

Income Tax Act 1961 Income Tax 2003-2004 to 2008- 2009, 2010-2011

Income Tax Act 1961 Income Tax 2002-03 and 2008-09

Income Tax Act 1961 Income Tax 2006-2007

Income Tax Act 1961 Income Tax 2006-2007 to 2014-2015

Name of statute Forum where dispute is Amount pending (Rs in lakhs)

IATT Rules, 1989 Delhi High Court 321

Customs Act 1962 Commissioner of Customs 426 (Appeals)

Customs Act 1962 Commissioner of Customs 1,085

Finance Act 1994 Supreme Court of India 361

Finance Act 1994 CESTAT 57,237

Finance Act 1994 Commissioner of Central Excise 27,820

Income Tax Act 1961 Commissioner of Income 1,681 Tax(Appeals)

Income Tax Act 1961 ITAT 296

Income Tax Act 1961 Bombay High Court 233

Income Tax Act 1961 Commissioner of Income Tax 6,999

c) The Company has been generally regular in transferring amounts to the Investor Education Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder within time.

(viii) The accumulated losses of the Company at the end of the financial year are more than fifty per cent of its net worth. The Company has not incurred cash losses during the financial year covered by our audit and has incurred cash losses in the immediately preceding financial year.

(ix) Based on our audit procedures and according to the information and explanations given to us, there have been defaults in the repayment of dues to financial institutions and banks as under:

period of delays principal Amount Interest Amount (Rs in lakhs) (Rs in lakhs)

Upto 30 days 7,855 554

31 to 60 days 2,343 116

The Company has not issued any debentures.

(x) The Company has given guarantees for loans taken by its wholly owned major subsidiary Company from banks/financial institution. Based on the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xi) In our opinion and according to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were obtained.

(xii) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year. We are informed that cases of possible fraudulent credit card ticket bookings aggregating to Rs. 57 lakhs are being pursued by the Management.

For DELOITTE HASKINS & SELLS LLP For CHATURVEDI & SHAH Chartered Accountants Chartered Accountants (Firm's Registration No. 117366W/W-100018) (Firm's Registration No. 101720W)

A. Siddharth parag D. Mehta Partner Partner Membership No. 31467 Membership No. 113904

Place : Mumbai Date : 29th May, 2015


Mar 31, 2014

Report on the Financial Statements

We have audited the accompanying financial statements of JET AIRWAYS (INDIA) LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March , 2014, 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 Financial Statements

The Company''s 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 notified under the Companies Act, 1956 ("the Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. 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.

Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and 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 control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

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

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

Emphasis of Matter

We draw attention to following notes to the financial statements:

(a) Note 32 regarding amount of investments in and advances to its wholly owned major subsidiary aggregating to Rs. 360,892 lakhs as at 31st March 2014 (Rs. 298,160 lakhs as at 31st March 2013). The subsidiary has a negative net worth of Rs. 214,289 lakhs (Rs. 171,358 lakhs as at 31st March 2013). On a consideration of factors as explained in the note, the Company has made a provision of Rs. 70,000 lakhs so as to fairly reflect the ''other than temporary'' diminution in such investment. The assessment of carrying amount of investment is critically dependent upon the achievement of the expected operating performance by the subsidiary after re-organization of the fleet as mentioned in the note.

(b) Note 42 regarding preparation of financial statements of the Company on going concern basis for the reasons stated therein. The appropriateness of assumption of going concern is dependent upon realisation of the synergies from alliance with the Strategic Partner and/or the Company''s ability to raise requisite finance/generate cash flows in future to meet its obligations, including financial support to its subsidiary.

Report on Other Legal and Regulatory Requirements

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

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as 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 Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs).

(e) On the basis of the written representations received from the directors as on 31st March, 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2014 from being appointed as a director in terms of Section 274(1)(g) of the Act.

Annexure to the Auditors'' Report to the Members of Jet Airways (India) Limited

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

(i) In respect of its fixed assets;

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

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us no material discrepancies were noticed on such verification.

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

(ii) In respect of its inventories;

a) As explained to us, the inventory has been physically verified during the year by the management other than inventory lying with third parties. In our opinion, the frequency of verification is reasonable. In respect of inventory lying with third parties we have relied on the confirmations obtained by the management from such entities.

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

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

(iii) In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

a) The Company has given loan to its two wholly owned subsidiary companies. In respect of the said loans, the maximum amount outstanding at any time during the year was Rs. 209,619 lakh and the year-end balance was Rs. 196,392 lakh.

b) In our opinion and based on explanations received from the management, the terms and conditions of the aforesaid loans are not prima facie prejudicial to the interest of the Company.

c) The Loan given to Jet lite India Limited is interest free loan and is repayable after six years (financial year 2019-20) by way of a bullet payment and loan given to Jet Privilege Private Ltd has been repaid during the year and interest charged is recovered.

d) The Company has not taken any loan during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clauses (iii) (f) and (iii) (g) of paragraph 4 of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, the internal control procedures for the purchase of inventory, fixed assets and with regard to rendering of services are commensurate with the size of the Company and the nature of its business. Sale of goods is not a significant part of the Company''s activity. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system.

(v) In respect of contracts or arrangements referred to in section 301 of the Companies Act 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements have been entered in the register maintained under that section.

(b) Transactions exceeding Rupees five lakh in respect of any party during the year made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time or within the limits stipulated in the Central Government approval.

(vi) According to information and explanations given to us, the company has not accepted deposits from the public during the year. Therefore, the provisions of clause 4(vi) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(vii) The Company has an internal audit system comprising of its own internal team for specific areas on a rotational basis. In our opinion, the Company has an adequate internal audit system commensurate with its size and nature of its business.

(viii) Maintenance of cost records has not been prescribed for the Company by the Central Government under clause (d) of sub section (1) of section 209 of the Companies Act, 1956. Therefore, the provisions of clause 4(viii) of the Companies (Auditor''s Report) Order, 2003 are not applicable.

(ix) In respect of statutory dues:

a) Undisputed statutory dues, including Investor Education and Protection Fund, Wealth Tax, Provident Fund, Custom Duty, Excise duty, cess and other material statutory dues, as applicable, have been generally regularly deposited with the appropriate authorities. However, in respect of Sales tax, Profession Tax, Employees'' State Insurance, Income tax (tax deducted at source) and Service Tax, the delays ranged from One day to Twenty months. No undisputed amounts in respect of such dues were outstanding as on 31st March, 2014 for a period more than six months from the date they became payable, except in respect of : i) Service taxRs. 5 lakhs (since paid), ii) Profession tax Rs. 1 lakh,and iii) interest on delayed payment of Income tax (tax deducted at source) and service tax- Rs. 4,077 lakhs and Rs. 100 lakhs respectively.

b) According to the information and explanations given to us, there are no dues of sales tax, income tax, service tax, custom duty, wealth tax and cess which have not been deposited on account of any dispute other than the following:

name of statute nature of the Amount Period to which the Forum where dispute is

dues (Rs. in lakhs) amount relates pending

IATT Rules, 1989 IATT Interest & 321 2003-04 Delhi High Court

Penalty

Customs Act 1962 Custom Duty 426 2006-2007 to 2010-2011 Commissioner of Customs

(Appeals)- Mumbai

Finance Act 1994 Service Tax 361 2003-2004 to 2005-2006 Supreme Court of India

Finance Act 1994 Service Tax 29,196 2002-2003 to 2011-2012 CESTAT

Finance Act 1994 Service Tax 197,524 2002-2003 to 2012-2013 Commissioner of Central Excise

Income Tax Act, 1961 Income Tax 5,905 2002-2003 to 2008-2009 Commissioner of Income

2010-2011 and 2011- Tax(Appeals) 2012

Income Tax Act, 1961 Income Tax 233 2006-2007 Bombay High Court

Income Tax Act, 1961 Income Tax 15,549 2006-2007 to 2013-2014 Commissioner of Income Tax

(x) The accumulated losses of the Company at the end of the financial year are more than fifty per cent of its net worth. The Company has incurred cash loss during current financial year but has not incurred any cash loss in the immediately preceding financial year.

(xi) Based on our audit procedures and according to the information and explanations given to us, there have been defaults in the repayment of dues to financial institutions and banks as under:

Period of Delay Principal Amount Interest Amount

(Rs. In lakhs) (Rs. In lakhs)

Upto 30 Days 77,415 13,445

31 to 60 Days 19,830 672

61 Days and above 21,768 477

All the aforesaid amounts are paid as on the Balance Sheet date

(xii) In our opinion and according to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and any other securities and hence question of maintenance of adequate records for this purpose does not arise.

(xiii) According to the information and explanation given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xiv) The Company has not dealt (other than in Mutual Fund Units) or traded in shares, securities, debentures or other investments during the year. For dealings in units of Mutual Funds, the Company has maintained proper records of transactions and contracts. All the investments have been held by the Company in its own name.

(xv) The Company has given guarantees for loans taken by its wholly owned subsidiary Company from banks/financial institution. Based on the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xvi) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short-term basis have, prima facie, not been used for long-term investment during the year.

(xviii) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4(xviii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xix) During the period covered by our audit report, the Company has not issued any debentures and no debentures were outstanding at the beginning of the year. Therefore, the provisions of clause 4(xix) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

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

(xxi) According to the information and explanations given to us and on the basis of the examination of the records, no fraud by the Company and no material fraud on the Company was noticed or reported during the year. We are informed that cases of possible fraudulent differential fare collection / refund by Airport personnel and credit card ticket bookings aggregating to Rs. 78 lakhs are being pursued by the management.

For DELOITTE HASkInS & SELLS LLP For CHATuRvEDI & SHAH

Chartered Accountants Chartered Accountants

(Firm''s Registration No. 117366W/W-100018) Firms Registration No. 101720W

R. D. Kamat C. D. Lala

Partner Partner

Membership No. 36822 Membership No. 35671

Place: Mumbai

Date: 27th May, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of JET AIRWAYS (INDIA) LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2013, 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 Financial Statements

The Company''s 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 Section 211(3C) of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles generally accepted in India. 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.

Auditors'' Responsibility

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

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

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

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

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

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

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

Emphasis of Matter

We draw attention to following notes to the financial statements :

(a) Note 29 A (b) (ix) which describes the uncertainty related to the outcome of the continuing litigation with erstwhile shareholders of Jet Lite (India) Limited. During the previous year, in terms of the order passed by the Honourable High Court of Bombay disposing off the claim, the Company had discharged Rs. 11,643 lakhs as interest @ 9% p.a.. The counterparty''s claim contesting this judgment seeking increased compensation and interest was dismissed by the Honourable High Court of Bombay. The Special Leave Petition filed by the parties is pending before the Honourable Supreme Court of India. Based on legal advice and pending final determination, the amount paid to the counter party has not been recognised as interest in the accounts.

(b) Note 32 regarding amount of investments in and advances given to its wholly owned major subsidiary aggregating to Rs. 298,160 lakhs as at 31st March 2013. The accumulated losses have fully eroded the net worth of the subsidiary in past and its negative net worth as at the year-end raised to Rs. 171,358 lakhs. The estimation is critically dependent on the achievement of the projections of operating performance by the subsidiary as mentioned in the Note.

(c) Note 39 regarding preparation of financial statements of the Company on going concern basis for the reasons stated therein.

The appropriateness of assumption of going concern is dependent upon implementation of the alliance with Strategic Partner and/or the Company''s ability to raise requisite finance/generate cash flows in future to meet its obligations, including financial support to its subsidiary.

Our opinion is not qualified in respect of these matters.

Report on Other Legal and Regulatory Requirements

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

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as 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 Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in Section 211(3C) of the Act.

(e) On the basis of the written representations received from the directors as on 31st March, 2013 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2013 from being appointed as a director in terms of Section 274(1)(g) of the Act.

Annexure to the Auditors'' Report

Annexure to the Auditors'' Report to the Members of Jet Airways (India) Limited

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

(i) In respect of its fixed assets;

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

b) The Company has a program of verification of fixed assets to cover all the items in a phased manner, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us no material discrepancies were noticed on such verification.

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

(ii) In respect of its inventories;

a) As explained to us, the inventory has been physically verified during the year by the management other than inventory lying with third parties. In our opinion, the frequency of verification is reasonable. In respect of inventory lying with third parties, we have relied on the confirmations obtained by the management from such entities.

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

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

(iii) In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956 :

a) The Company has given interest free loan to its wholly owned subsidiary company. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 142,102 lakhs and the year-end balance was Rs. 133,660 lakhs.

b) In our opinion and based on explanations received from the management, the terms and conditions of the aforesaid loans are not prima facie prejudicial to the interest of the Company.

c) The said interest free loan is repayable after 7 years (financial year 2019-20) by way of a bullet payment.

d) The Company has not taken any loan during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clauses (iii) (f) and (iii) (g) of paragraph 4 of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, the internal control procedures for the purchase of inventory, fixed assets and with regard to rendering of services are commensurate with the size of the Company and the nature of its business. Sale of goods is not a significant part of the Company''s activity. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system.

(v) In respect of contracts or arrangements referred to in section 301 of the Companies Act 1956, to the best of our knowledge and belief and according to the information and explanations given to us :

(a) The particulars of contracts or arrangements have been entered in the register maintained under that section.

(b) Transactions exceeding Rupees five lakhs in respect of any party during the year made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time or within the limits stipulated by the Central Government approval.

(vi) According to information and explanations given to us, the company has not accepted deposits from the public during the year. Therefore, the provisions of clause 4(vi) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(vii) The Company has an internal audit system comprising of its own internal team and involvement of a reputed external firm of Chartered Accountants for specific areas on a rotational basis. In our opinion, the Company has an adequate internal audit system commensurate with its size and nature of its business.

(viii) Maintenance of cost records has not been prescribed for the Company by the Central Government under clause (d) of sub section (1) of section 209 of the Companies Act, 1956. Therefore, the provisions of clause 4(viii) of the Companies (Auditor''s Report) Order, 2003 are not applicable.

(ix) In respect of statutory dues :

a) Undisputed statutory dues, including Investor Education and Protection Fund, Wealth Tax, Custom Duty, Excise duty, Cess and other material statutory dues, as applicable, have been generally regularly deposited with the appropriate authorities. However, in respect of Sales Tax, Provident Fund, Employees'' State Insurance, Income Tax and Service Tax, the delays ranged from fifteen days to eight months. No undisputed amounts payable in respect of the aforesaid dues were outstanding as on 31st March, 2013 for a period more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Service Tax, Custom Duty, Wealth Tax and Cess which have not been deposited on account of any dispute other than the following :

(x) The accumulated losses of the Company at the end of the financial year are more than fifty per cent of its net worth. The Company has incurred cash loss only during the preceding financial year but has not incurred any cash loss during the current financial year.

(xi) Based on our audit procedures and according to the information and explanations given to us, there have been defaults in the repayment of dues to financial institutions and banks as under :

Period of Delay Principal Amount Interest Amount Status of Payment (Rs. In lakhs) (Rs. In lakhs)

up to 30 Days 51,328 5,711 Paid

31 to 60 Days 22,440 15 Paid

60 days and above 9,371 - Unpaid

(xii) In our opinion and according to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and any other securities and hence question of maintenance of adequate records for this purpose does not arise.

(xiii) According to the information and explanation given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. Therefore the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xiv) The Company has not dealt (other than in Mutual Fund Units) or traded in shares, securities, debentures or other investments during the year. For dealings in units of Mutual Funds, the Company has maintained proper records of transactions and contracts. All the investments have been held by the Company in its own name.

(xv) The Company has given guarantees for loans taken by its wholly owned subsidiary Company from banks/financial institution. Based on the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xvi) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short-term basis have, prima facie, not been used for long-term investment during the year.

(xviii)According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4(xviii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xix) During the period covered by our audit report, the Company has not issued any debentures and no debentures were outstanding at the beginning of the year. Therefore, the provisions of clause 4(xix) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

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

(xxi) According to the information and explanations given to us and on the basis of the examination of the records, except for possible fraudulent bookings of tickets through credit cards amounting Rs. 134 lakhs, which we are informed are being pursued, no fraud by the Company and no material fraud on the Company was noticed or reported during the year.

For Deloitte Haskins & Sells For Chaturvedi & Shah

Chartered Accountants Chartered Accountants

Registration No. 117366W Registration No. 101720W

R. D. Kamat C. D. Lala

Partner Partner

Membership No. 36822 Membership No. 35671

Place : Mumbai

Date : 24th May, 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of Jet Airways (India) Limited ("the Company") as at 31st March , 2012, and the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date, both 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. An audit also includes assessing the accounting principle used and the 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. Without qualifying our opinion, we invite attention to the following notes:

i) Note no. 32 (b) (viii) regarding the continuing litigation with erstwhile shareholders of Jet Lite (India) Limited. During the year, the Honorable High Court of Bombay had disposed off the Execution application in terms of which the Company paid Rs. 11,643 lakhs as interest @ 9% p.a. The counterparty contested this judgment and sought increased compensation and interest @18% p.a. instead of 9% p.a. while the Company challenged the levy of interest in toto. Consequent to the dismissal of this matter by the Honorable High Court of Bombay, both the parties filed a Special Leave Petition which is pending before the Honorable Supreme Court of India. The management has, based on legal advice and pending final determination, not recognized the amount paid as aforesaid as interest in the accounts.

ii) Note no. 35 regarding investments in and advances given to its subsidiary aggregating to Rs. 292,739 lakhs (Previous year Rs. 317,451 lakhs). The accumulated losses have fully eroded the net worth of the subsidiary and its negative net worth as at the year-end is Rs 141,826 lakhs (Previous year Rs. 123,533 lakhs). An external valuation report obtained by the management covers the carrying value of such investment / advance and accordingly no provision for diminution/recoverability is considered necessary by the management. In view of the prevailing situation in the aviation sector, the valuation as aforesaid is dependent on the achievement of the projections as regards operating performance by the subsidiary.

iii) Note no. 1 A (c) regarding preparation of financial statements of the Company on going concern basis for the reasons stated therein. The appropriateness of assumption of going concern is critically dependent upon the Company's ability to raise requisite finance / generate cash flows in the near future to meetits obligations.

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

5. Further, to our comments in paragraphs 3 (i) to (iii) above and the Annexure referred to in paragraph 4 above, we report that:

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

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

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

(d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act 1956;

(e) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the mannerso required and give a true and fair view in conformity with the accounting principles generally accepted in India;

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

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

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

6. On the basis of written representations received from Directors, as on 31st March, 2012 taken on record by the Board of Directors, we further report that none of the Directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of Section 274 (1) (g) of the Companies Act, 1956.

Annexure to the Auditors' Report

ANNEXURE TO THE AUDITORS' REPORT TO THE MEMBERS OF

JET AIRWAYS (INDIA) LIMITED

(Referred to in paragraph 4 of our report of even date)

1) In respect of its fixed assets;

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

b) As explained to us, the fixed assets have been physically verified by the management during the year in a phased manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

c) In our opinion, the company has not disposed off a substantial part of the fixed assets during the year and the going concern status of the Company is not affected.

2) In respect of its inventories;

a) The inventory has been physically verified during the year by the management except inventory lying with third parties. In our opinion, the frequency of verification is reasonable.

b) In our opinion and based on the information and explanations given to us, the procedures of physical verification followed by the management of stock lying with it were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification. In respect of items lying with other entities we have relied on the confirmations obtained by the management from such entities.

3) In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

a) The Company has given interest free loan to its wholly owned Subsidiary company. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 164,110 lakhs and the year-end balance was Rs. 128,239 lakhs.

b) In our opinion and based on explanations received from the management, the terms and conditions of the aforesaid loans are not prima facie prejudicial to the interest of the Company.

c) The said interest free loan is repayable after 8 years (financial year 2019-20) by way of a bullet payment.

d) The Company has not taken any loan during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clauses (iii) (f) and

(iii) (g) of paragraph 4 of the Order are not applicable.

4) In our opinion and according to the information and explanations given to us, the internal control procedures for the purchase of inventory, fixed assets and with regard to rendering of services are commensurate with the size of the Company and the nature of its business. Sale of goods is not a significant part of the Company's activity. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal controls.

5) In respect of contracts or arrangements referred to in section 301 of the Companies Act 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements have been entered in the register maintained under that section.

(b) Transactions exceeding Rupees five lakhs in respect of any party during the year made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time or within the limits stipulated by the Central Government approval.

6) According to information and explanations given to us, the company has not accepted deposits from the public. Therefore the provisions of clause 4(vi) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

7) The Company has an internal audit system comprising of its own internal team and involvement of a reputed external firm of Chartered accountants for specific areas on a rotational basis. In our opinion, the Company has an adequate internal audit system commensurate with its size and nature of its business.

8) Maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of section 209 of the Companies Act, 1956. Therefore the provisions of clause 4(viii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

9) In respect of statutory dues :

a) According to the records of the Company, 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 material statutory dues, as applicable, have been generally regularly deposited with the appropriate authorities during the year though there are delays in few cases. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as on 31st March, 2012 for a period more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of sales tax, income tax, service tax, custom duty, wealth tax and cess which have not been deposited on account of any dispute other than the following:

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

IATT Rules, 1989 IATT Customs Interest & Penalty 321 2003-04 Commissioner of (Appeals), New Delhi

Customs Act, 1962 Custom Duty 143 2007-2008 Commissioner of Customs (Appeals)- Mumbai

Finance Act, 1994 Service Tax 2,374 2001-02 to 2009-2010 CESTAT

Finance Act, 1994 Service Tax 138,985 2001-02 to 2010-11 Commissioner of Central Excise

Income Tax Income Tax 8,334 2005-2006 Commissioner of Act,1961 to 2007-2008 Income Tax and 2009-2010 (Appeals)

Income Tax Act,1961 Income Tax 233 2006-2007 Income Tax Appellate Tribunal (ITAT)

Income Tax Act,1961 Income Tax 24,529 2006-07 to 2010-2011 Commissioner of Income Tax

10) The accumulated losses of the Company at the end of the financial year are more than fifty per cent of its net worth. The Company has incurred cash loss during the current financial year and in the immediately preceding financial year, the Company had made cash profit.

11) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institutions and banks.

12) In our opinion and according to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and any other securities and hence question of maintenance of adequate records for this purpose does not arise.

13) In our opinion and according to the information and explanation given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

14) The Company has not dealt (other than in Mutual Fund Units) or traded in shares, securities, debentures or other investments during the year. For dealings in units of Mutual Funds, the Company has maintained proper records of transactions and contracts. All the investments have been held by the Company in its own name.

15) The Company has given guarantees for loans taken by its wholly owned Subsidiary Company from banks/financial institution. Based on the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

16) In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

17) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short-term basis have, prima facie, not been used for long-term investment during the year.

18) According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4(xviii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

19) During the period covered by our audit report, the Company has not issued any debentures and no debentures were outstanding at the beginning of the year. Therefore, the provisions of clause 4(xix) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

20) The Company has not raised any money by way of public issue during the year.

21) According to the information and explanations given to us and on the basis of the examination of the records, except for possible fraudulent bookings of tickets through credit cards amounting Rs. 37 lakhs, which we are informed are being pursued, no fraud by the Company and no material fraud on the Company was noticed or reported during the year.

FOR DELOITTE HASKINS & SELLS FOR CHATURVEDI & SHAH

CHARTERED ACCOUNTANTS CHARTERED ACCOUNTANTS

Registration No.117366W Registration No.101720W

R. D. KAMAT RAJESH D. CHATURVEDI

Partner Partner

M. No. 36822 M. No. 45882

Mumbai

24th May 2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of Jet Airways (India) Limited ("the Company") as at 31st March, 2011, and the Profit and Loss Account and the Cash Flow Statement of the company for the year ended on that date both 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. An audit also includes assessing the accounting principle used and the 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 (CARO), issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

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

(d) in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act 1956;

(e) Without qualifying our opinion, we invite attention to the following notes to Schedule "S":

i) Note no. 2 (l) regarding the litigation with erstwhile shareholders of Jet Lite (India) Limited. Subsequent to the Balance Sheet date, the Honorable Bombay High Court has disposed off the Execution application in terms of which the Company has paid Rs.11,643 lakh as interest - of which, Rs.11,305 lakh pertain to the period up to 31st March, 2011. The counterparty has contested this judgement while the company is considering pursuing its plea against awarding of interest by the executing court, based on legal advice. Pending final determination, no provision has been made in the accounts for the interest of Rs.11,305 lakh.

ii) Note no. 5 regarding investments in and advances given to a subsidiary aggregating to Rs.317,451 lakh. No provision for diminution / recoverability is considered necessary for reasons stated therein.

(f) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

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

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

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

5. On the basis of written representations received from Directors, as on 31st March, 2011 taken on record by the Board of Directors, we further report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956;

(Referred to in paragraph 3 of our report of even date)

1) In respect of its fixed assets;

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

b) As explained to us, the fixed assets have been physically verified by the management during the year in a phased manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

c) In our opinion, the Company has not disposed off a substantial part of the fixed assets during the year and the going concern status of the Company is not affected.

2) In respect of its inventories;

a) The inventory has been physically verified during the year by the management except inventory lying with third parties. In our opinion, the frequency of verification is reasonable.

b) In our opinion and based on the information and explanations given to us, the procedures of physical verification followed by the management of stock lying with it were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification. In respect of items lying with other entities we have relied on the confirmations obtained by the management from such entities.

3) In respect of the loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

a) The Company has given interest free loan to its wholly owned subsidiary company. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs.172,796 lakh and the year-end balance was Rs.152,951 lakh.

b) In our opinion and based on explanations received from the management, the terms and conditions of the aforesaid loans are not prima facie prejudicial to the interest of the Company.

c) The said interest free loan is repayable on demand. There is no repayment schedule / overdue amount.

d) The Company has not taken any loan during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clauses (iii) (f) and (iii) (g) of paragraph 4 of the Order are not applicable.

4) In our opinion and according to the information and explanations given to us, the internal control procedures for the purchase of inventory, fixed assets and with regard to rendering of services are commensurate with the size of the Company and the nature of its business. Sale of goods is not a significant part of the Companys activity. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal controls.

5) In respect of contracts or arrangements referred to in section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements have been entered in the register maintained under that section.

(b) Transactions exceeding Rupees five lakh in respect of any party during the year made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time or within the limits stipulated by the Central Government approval.

6) According to information and explanations given to us, the company has not accepted deposits from the public. Therefore the provisions of clause 4(vi) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

7) The Company has an internal audit system comprising of its own internal team and involvement of a reputed external firm of Chartered accountants for specific areas on a rotational basis. In our opinion, the Company has an adequate internal audit system commensurate with its size and nature of its business.

8) Maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of section 209 of the Companies Act, 1956. Therefore the provisions of clause 4(viii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

9) In respect of statutory dues:

a) According to the records of the Company, 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 material statutory dues, as applicable, have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as on 31st March, 2011 for a period more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Service Tax, Custom Duty, Wealth Tax and Cess which have not been deposited on account of any dispute other than the following:

Name of statute Nature of the dues Amount Period to which the Forum where (Rs. in lakh) amount relates dispute is pending

IATT Rules, 1989 IATT Interest and Penalty 321 2003-04 Commissioner of Customs (Appeals) New Delhi

B.M.C. Act, 1988 Octroi Dues 2,899 2000-01 Mumbai High Court

Finance Act, 1994 Service Tax 33 2004-05 to2005-06 Commissioner of Central Excise Appeals)

Finance Act, 1994 Service Tax 1,707 2001-02 to 2006-07 CESTAT

Finance Act, 1994 Service Tax 127,762 2001-02 to 2009-10 Commissioner of Central Excise

Income Tax Act,1961 Income Tax 11,459 2003-2004 to 2008-2009 Commissioner of Income Tax (Appeals) Income Tax Act,1961 Income Tax 23,463 2006-07 to 2008-09 Commissioner of Income Tax

10) The accumulated losses of the Company at the end of the financial year are less than fifty per cent of its net worth. The Company has not incurred cash loss during the current financial year and in the immediately preceding financial year.

11) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institutions and banks.

12) In our opinion and according to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and any other securities and hence question of maintenance of adequate records for this purpose does not arise.

13) In our opinion and according to the information and explanation given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

14) The Company has not dealt (other than in Mutual Fund Units) or traded in shares, securities, debentures or other investments during the year. For dealings in units of Mutual Funds, the Company has maintained proper records of transactions and contracts. All the investments have been held by the Company in its own name.

15) The Company has given guarantees for loans taken by its wholly owned subsidiary Company from banks / financial institution. Based on the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

16) In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

17) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short-term basis have, prima facie, not been used for long-term investment during the year.

18) According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4(xviii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

19) During the period covered by our audit report, the Company has not issued any debentures and no debentures were outstanding at the beginning of the year. Therefore, the provisions of clause 4(xix) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

20) The Company has not raised any money by way of public issue during the year.

21) According to the information and explanations given to us and on the basis of the examination of the records, except for possible fraudulent bookings of tickets through credit cards amounting Rs.41 lakh, which we are informed are being pursued, no fraud by the Company and no material fraud on the Company was noticed or reported during the year.

FOR DELOITTE HASKINS & SELLS FOR CHATURVEDI & SHAH

CHARTERED ACCOUNTANTS CHARTERED ACCOUNTANTS

Registration No.117366W Registration No.101720W

R. D. KAMAT C.D.LALA

PARTNER PARTNER

M. No. 36822 M. No. 35671

Mumbai

19th May 2011




Mar 31, 2010

1. We have audited the attached Balance Sheet of Jet Airways (India) Limited ( the Company") as at March 31, 2010, and the Profit and Loss Account and the Cash Flow Statement of the company for the year ended on that date both 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. An audit also includes assessing the accounting principles used and the 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 (CARO), issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

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

(d) in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

(e) Without qualifying our opinion, we invite attention to the following notes to Schedule "S":

i) note no. 5 (a) regarding investments in and advances given to a subsidiary aggregating to Rs. 232,707 lac. No provision for diminution / recoverability is considered necessary for reasons stated therein.

ii) note no. 5 (b) regarding a claim against the Company. The matter being sub-judice, it is not possible to determine the impact of the outcome at this stage.

(f) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

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

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

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

5. On the basis of written representations received from Directors, as on 31s March, 2010 taken on record by the Board of Directors, we further report that none of the Directors is disqualified as on 31s March, 2010 from being appointed as a director in terms of Section 274 (1) (g) of the Companies Act, 1956;

Annexure to the Auditors Report (Referred to in paragraph 3 of our report of even date)

1) In respect of its fixed assets;

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

b) As explained to us, the fixed assets have been physically verified by the management during the year in a phased manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

c) In our opinion, the company has not disposed off a substantial part of the fixed assets during the year and the going concern status of the Company is not affected.

2) In respect of its inventories;

a) The inventory has 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 were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3) In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

a) The Company has given interest free loan to its wholly owned subsidiary company. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 72,614 lac and the year-end balance was Rs. 68,207 lac.

b) In our opinion and based on explanations received from the management, the terms and conditions of the aforesaid loans are not prima facie prejudicial to the interest of the Company.

c) The said interest free loan is repayable on demand. There is no repayment schedule/ overdue amount.

d) The Company has not taken any loan during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of Clauses (iii) (f) and (iii) (g) of paragraph 4 of the Order are not applicable.

4) In our opinion and according to the information and explanations given to us, the internal control procedures for the purchase of inventory, fixed assets and with regard to rendering of services are commensurate with the size of the Company and the nature of its business. Sale of goods is not a significant part of the Companys activity. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5) In respect of contracts or arrangements referred to in section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements have been entered in the register maintained under that section.

(b) Transactions exceeding Rupees five lac in respect of any party during the year made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market prices at the relevant time or within the limits stipulated by the Central Government approval.

6) According to information and explanations given to us, the company has not accepted deposits from the public. Therefore, the provisions of clause 4(vi) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

7) The Company has an internal audit system comprising of its own internal management audit team and during the year it also involved a firm of chartered accountants for specific areas. The scope of internal audit needs to be extended to include certain areas viz. outsourced payroll and purchase of fixed assets so as to be commensurate with the size of the Company and nature of its business.

8) Maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of section 209 of the Companies Act, 1956. Therefore, the provisions of clause 4(viii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

9) In respect of statutory dues:

a) According to the records of the Company, 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 material statutory dues have been generally regularly deposited with the appropriate authorities. According to the information and explanation given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at March 31, 2010 for a period of more than six months from the date they become payable.

b) According to the information and explanations given to us, there are no dues of sales tax, income tax, service tax, custom duty, wealth tax, excise duty and cess which have not been deposited on account of any dispute other than the following:

Name of statute Nature of the dues Amount Period to which the Forum where (Rs. lac) amount relates dispute is pending

IATT Rules, 1989 IATT Interest & Penalty 321 2003-04 Commissioner of Customs (Appeals), New Delhi

B.M.C. Act, 1988 Octroi Dues 2,899 2000-01 Mumbai High Court

Central Excise and Service Tax 33 2001-02 to 2004-05 Commissioner of Custom Act Central Excise (Appeals)

Central Excise and Service Tax 288 2001-02 To 2006-07 CESTAT Custom Act

Central Excise and Custom Act Service Tax 78,106 2002-03 to 2008-09 Commissioner of Central Excise

Income Tax Act,1961 Income Tax 1,078 2005-2006 to Commissioner of 2008-2009 Income Tax (Appeals)

10) The accumulated losses of the Company at the end of the financial year are less than fifty per cent of its net worth and it has not incurred cash loss during the current financial year and in the immediately preceding financial year, the Company had made cash losses.

11) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institutions and banks.

12) In our opinion and according to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and any other securities and hence question of maintenance of adequate records for this purpose does not arise.

13) In our opinion the company and according to the information and explanation given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

14) The Company has not dealt, other than in units, or traded in shares, securities, debentures or other investments during the year. In our opinion and according to information and explanations given to us the Company has dealt in units of Mutual Funds for which the Company has maintained proper records of transactions and contracts. All the investments have been held by the Company in its own name.

15) The Company has given guarantees for loans taken by Subsidiary Company from bank and financial institution. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company as it is wholly owned subsidiary.

16) In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

17) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short-term basis have, prima facie, not been used for long-term investment during the year.

18) According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4(xviii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

19) During the period covered by our audit report, the Company has not issued any debentures and no debentures were outstanding at the beginning of the year. Therefore, the provisions of clause 4(xix) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

20) The Company has not raised any money by way of public issue during the year.

21) According to the information and explanations given to us and on the basis of the examination of the records, except for possible fraudulent bookings of tickets through credit cards amounting to approx. Rs. 121 lac, which we are informed are being pursued, no fraud on or by the Company was noticed or reported during the year.

FOR DELOITTE HASKINS & SELLS FOR CHATURVEDI & SHAH

CHARTERED ACCOUNTANTS CHARTERED ACCOUNTANTS

Registration No.117366W Registration No.101720W

R. D. KAMAT C.D.LALA

PARTNER PARTNER

M. No. 36822 M. No. 35671

Mumbai, 20th May 2010

 
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