Auditor Report of Lancor Holdings Ltd.

Mar 31, 2018

TO THE MEMBERS OF LANCOR HOLDINGS LIMITED

We have audited the accompanying standalone financial statements of Lancor Holdings Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the standalone financial statements”).

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 including other comprehensive income, cash flows and statement of changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with relevant rule of the Companies (Accounts) Rules issued there in. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

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

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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, including the Ind AS, of the state of affairs of the Company as at March 31, 2018, and its profit including (other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

The comparative financial information of the Company as on April 1, 2016 and March 31, 2017 prepared in accordance with the Ind AS included in these financial statements have been audited by the predecessor auditor. The report of the predecessor auditor on this comparative financial information dated May 28, 2016 and May 29, 2017 expressed an unmodified conclusion.

Emphasis of Matter

We draw your attention to,

a) Note no. 4.12 (b) to the audited standalone financial statement relating to circumstances which have been considered for determining the period for capitalization of borrowing cost.

b) Note no. 4.02 (a) regarding pending litigation to one of the Commercial Property accounted as investment property having carrying value of Rs 3,424.09 lakhs.

Our report is not qualified in respect of the above matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), issued by the Central Government of India in terms of section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraph 3 and 4 of the said Order, to the extent applicable.

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 and statement of changes in equity dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with relevant rules issued there under.

(e) On the basis of the written representations received from the directors as on March 31, 2018 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164(2) of the Act.

(f) With respect to adequacy of internal financial controls with reference to financial statements of the Company and operating effectiveness of such controls, we give our separate report in “Annexure B”.

(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 litigation on its financial position in its financial statement. Refer note number 4.02 to the financial statement.

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

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

Referred to in Paragraph 3 of our report of even date

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of property, plant & equipment and investment property.

(b) As per the plan and programme of the management property, plant & equipment, investment property have been physically verified. The programme of physical verification of property, plant & equipment, investment property in our opinion is considered reasonable having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

(c) The title deeds of the Immovable Properties classified under the head property, plant & equipment and investment property are held in the name of the Company. However, in one case, with respect to a commercial property which is classified under investment property having gross block value Rs.3,626.02 lakhs & net block value Rs. 3,424.09 lakhs as on March 31, 2018, the dispute with the landowner relating to the land on which the property is situated, the single bench of the Hon’ble High Court of Madras has set aside the invalidation of the sale deed. Subsequently, the landowners have filed an appeal before the division bench of Hon’ble High court of Madras and the matter is pending. We refer to the note no. 4.02 (a) regarding this matter.

ii. The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable and adequate in relation to the size of the Company and to nature of its business. We have been informed that no material discrepancies were noticed on verification between the physical stocks and the book of accounts.

iii. The Company has granted unsecured loans to one firm covered in the register maintained under Section 189 of the Companies Act, 2013.

a) In our opinion and according to the information and explanation provided to us, the terms and conditions of on which the loan has been granted are not prima facie prejudicial to the interest of the Company.

b) In the case of the firm, as per the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of principal and interest amount wherever applicable does not arise.

c) As stated in sub clause (b), as no repayment schedule has been specified, the question of total amount over due for more than 90 days and reasonable step taken for recovery in this regard does not arise.

iv. In our opinion and according to the information and explanation provided to us, in respect to loans, investments, guarantees and securities, provisions of section 185 and 186 of the Companies Act, 2013 has been complied with.

v. In our opinion and according to the information and explanation given to us, the Company has not accepted deposits from the public and therefore, the provisions contained in sections 73 to 76 or any other relevant provisions of the Act and Rules framed there under are not applicable to the Company. We have been informed that no order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

vi. We have broadly reviewed the books of account and records maintained by the Company relating to construction and development activity, pursuant to the Companies (Cost Records and Audit) Rules, 2014 made by the Central Government for the maintenance of cost record under section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determining whether they are accurate or complete.

vii. a) Based on the record produced to us, the Company has generally been regular in depositing with the appropriate authorities undisputed dues, including provident fund, employees’ state insurance, income-tax, sales tax, service tax, goods and service tax, duty of customs, cess and other material statutory dues applicable to it. According to the information and explanations given to us, no undisputed amount payable in respect of outstanding statutory dues were in arrears as at March 31, 2018 for a period of more than six months from the date they became payable.

b) According to the information and explanation given to us, there are no dues of income tax, goods and of service tax, sales tax, duty of customs, duty of excise, value added tax or cess have not been deposited on account dispute except for service tax, interest on service tax and penalty as on March 31, 2018 which has been provided below.

S.No.	Name of the Statute	Nature of Dues	Period to which the amount relates	Forum where the dispute is pending	Amount (Rs.)
1	Finance Act, 1994	Penalty and Interest on Service Tax	February 2009 to June 2009	Customs, Excise and Service tax Appellate Tribunal	Not Yet Determined
2	Finance Act, 1994	Service Tax	October 2007 to August 2009	Customs, Excise and Service tax Appellate Tribunal	1,56,10,334 (Note -1)

Note - 1: The amount is excluding interest and penalty

viii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not received any loan from Government and also has not issued any debenture. Accordingly reporting relating to default in repayment of dues to Government and debenture holders does not arise.

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

x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year, nor have we been informed of such case by the management.

xi. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not paid any managerial remuneration. Accordingly the reporting regarding compliance with the provision of section 197 read with schedule V of the Companies Act 2013 does not arise.

xii. The Company is not a Nidhi Company. Therefore, the provisions of paragraph 3 (xii) of the Order are not applicable to the Company.

xiii. According to the information and explanation provided to us and in our opinion, the related party transactions are entered in to by the Company are in compliance with section 177 and section 188 of the Companies Act, 2013 and the same has been disclosed in the financial statements, as required by the applicable Indian accounting standards.

xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures during the year. Accordingly the paragraph 3 (xiv) of the Order are not applicable to the Company.

xv. According to the information and explanation provided to us and based on the examination of the books of account, the Company has not entered in to any non- cash transaction with the director or person connected with him. Accordingly the paragraph 3 (xv) of the Order is not applicable to the Company.

xvi. As per the information and explanation provided to us, the Company is not required to register u/s 45-IA of the Reserve Bank of India Act, 1934.

Annexure ''B'' to the Independent Auditor''s Report

Referred to paragraph 2(f) under the heading ‘Report on other Legal and Regulatory Requirements’ of our report on even date to the financial statements of the Company for the year ended March 31, 2018

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

We have audited the internal financial controls with reference to financial statements of Lancor Holdings Limited (the “Company”) as of March 31, 2018 in conjunction with our audit of the standalone financial statements of the company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

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

Auditor''s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (“Guidance Note”) and the Standards on auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those standards and guidance note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements were established and maintained and if such controls operated effectively in all material respects.

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

We believe that the audit evidence we obtained is sufficient and appropriate to provide a basis for our opinion on the company’s internal financial control with reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

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

Inherent Limitations of Internal Financial Controls with reference to Financial Statements

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

Opinion

In our opinion, the Company has, in all material aspects, an adequate internal financial controls system with reference to financial statements and such internal financial controls with reference to financial statements were operating effectively as at March 31, 2018, based on the internal control with reference to financial statements criteria established by the Company considering the essential components of the internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For Nayan Parikh &

Co. Chartered Accountants

Firm Registration No.107023W

Sd/-

K.Y. Narayana

Chennai Partner

^{Dated: May 14, 2018} Membership No. 060639

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Mar 31, 2016

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Lancor Holdings Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2016, 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.

Auditor’s Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

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

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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 March 31, 2016, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

a) We draw your attention to note no.4.04 (b) to the audited standalone financial statement relating to circumstances which have been considered for determining the period for capitalization of borrowing cost.

b) We draw attention to note no. 4.12 (a) regarding pending litigation to one of the Commercial Property accounted as fixed assets.

Our report is not qualified in respect of the above matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), issued by the Central Government of India in terms of section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraph 3 and 4 of the said Order, to the extent applicable.

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) On the basis of the written representations received from the directors as on March 31, 2016 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016 from being appointed as a director in terms of Section 164(2) of the Act.

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

(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 litigation on its financial position in its financial statement. Refer note number 4.12 to the financial statement.

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

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

Referred to in Paragraph 3 of our report of even date

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

(b) As per the plan and programme of the management fixed assets have been physically verified. The programme of physical verification of fixed assets in our opinion is considered reasonable having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification. As regards capital work-in-progress, the same will be verified by the management on completion of assets.

(c) The title deeds of the Immovable Properties classified under the head Fixed assets are held in the name of the Company. However in one case, with respect to a commercial property having gross block value Rs.48,41,55,745/- & net block value Rs.36,66,29,353/- as on March 31, 2016,due to dispute with the landowner relating to the land on which the property is situated the matter is pending with the Honorable High Court of Madras. We refer to the note no. 4.12 (a) regarding this matter.

ii. The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable and adequate in relation to the size of the company and to nature of its business. We have been informed that no material discrepancies were noticed on verification between the physical stocks and the book of accounts.

iii. The Company has granted unsecured loans to two Companies and One firm covered in the register maintained under Section 189 of the Companies Act, 2013.

a) In our opinion and according to the information and explanation provided to us, the terms and conditions of on which the loan has been granted are not prima facie prejudicial to the interest of the Company.

b) In the case of the Companies and firm, as per the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of principal and interest amount wherever applicable doesn’t arise.

c) As stated in sub clause (b), as no repayment schedule has been specified, the question of total amount over due for more than 90 days and reasonable step taken for recovery in this regard does not arise.

iv. In our opinion and according to the information and explanation provided to us, in respect to loans, investments, guarantees and securities, provisions of section 185 and 186 of the Companies Act, 2013 has been complied with.

v. In our opinion and according to the information and explanation given to us, the Company has not accepted deposits from the public and therefore, the provisions contained in sections 73 to 76 or any other relevant provisions of the Act and Rules framed there under are not applicable to the Company. We have been informed that no order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

vi. We have broadly reviewed the books of account and records maintained by the Company relating to construction and development activity, pursuant to the order made by the Central Government for the maintenance of cost record under section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

vii. a) Based on the record produced to us, the Company has generally been regular in depositing with the appropriate authorities undisputed dues, including provident fund, employees’ state insurance, income-tax, sales tax, service tax, duty of customs , duty of excise, value added tax, cess and other material statutory dues applicable to it. According to the information and explanations given to us, no undisputed amount payable in respect of outstanding statutory dues were in arrears as at March 31, 2016 for a period of more than six months from the date they became payable.

b) According to the information and explanation given to us, there are no dues of income tax, sales tax, duty of customs, duty of excise, value added tax or cess except for service tax, interest on service tax and penalty as on March 31, 2016.

S.No	Name of the Statute	Nature of Dues	Period to which the amount relates	Forum where the dispute is pending	Amount (Rs.)
1	Finance Act, 1994	Penalty and Interest on Service T ax	February 2009 to June 2009	Customs, Excise and Service tax Appellate Tribunal	Not Yet Determined
2	Finance Act, 1994	Service T ax	October 2007 to August 2009	Customs, Excise and Service tax Appellate Tribunal	1,56,10,334 (Note -1)

Note - 1: The amount is excluding interest and penalty

viii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not received any loan from Government and also has not issued any debenture. Accordingly reporting relating to default in repayment of dues to Government and debenture holders does not arise.

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

x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year, nor have we been informed of such case by the management.

xi. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not paid any managerial remuneration. Accordingly the reporting regarding compliance with the provision of section 197 read with schedule V of the Companies Act 2013 does not arise.

xii. The Company is not a Nidhi Company. Therefore, the provisions of paragraph 3 (xii) of the Order are not applicable to the Company.

xiii. According to the information and explanation provided to us and in our opinion, the related party transactions are entered in to by the Company are in compliance with section 177 and section 188 of the Companies Act, 2013 and the same has been disclosed in the financial statements, as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures during the year. Accordingly the paragraph 3 (xiv) of the Order are not applicable to the Company.

xv. According to the information and explanation provided to us and based on the examination of the books of account, the Company has not entered in to any non- cash transaction with the director or person connected with him. Accordingly the paragraph 3 (xv) of the Order is not applicable to the Company.

xvi. As per the information and explanation provided to us, the Company is not required to register u/s 45-IA of the Reserve Bank of India Act, 1934.

For G.M.Kapadia & Co.

Chartered Accountants

(Firm Registration No.104767W)

Satya Ranjan Dhall

Chennai Partner

Dated: May 28, 2016 (Membership No. 214046)

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Mar 31, 2015

We have audited the accompanying standalone financial statements of LANCOR HOLDINGS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 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.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, 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 March 31, 2015, and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order"), issued by the Central Government of India in terms of section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraph 3 and 4 of the said Order, to the extent applicable.

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

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

i. The Company has disclosed the impact of pending litigation on its financial position in its financial statement. Refer note number 4.11 to the financial statement.

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

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

ANNEXURE TO THE AUDITOR'S REPORT

(Referred to in Paragraph 1 under "Other Legal and Regulatory Requirements" of our report of even date)

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

(b) As per the plan and programme of the management fixed assets have been physically verified. The programmee of verification, 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;

ii. (a) The inventory has been physically verified during the year by the management. In our opinion the frequency of verification is reasonable.

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company has maintained proper records of inventory and no discrepancies were noticed on verification between the physical stocks and books of accounts.

iii. The Company has granted unsecured loans to three companies and one firm covered in the register maintained under section 189 of the Act.

(a) In case of the companies and firm, as per the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of the principal amount, wherever applicable does not arise.

(b) As stated above, in case of Companies, as no repayment schedule has been specified, there are no overdue amounts in excess of Rupees one lakh.

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

v. In our opinion and according to the information and explanation given to us, the Company has not accepted deposits from the public and therefore, the provisions contained in sections 73 to 76 or any other relevant provisions of the Act and Rules framed there under are not applicable to the Company. We have been in- formed that no order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal

vi. We have broadly reviewed the books of account and records maintained by the Company relating to construction and development activity, pursuant to the order made by the Central Government for the maintenance of cost record under section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

vii. (a) Based on the records produced before us, the Company has been generally regular in depositing with appropriate authorities undisputed statutory dues such as provident fund, employees state insurance, in- come-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other statutory dues applicable to it. According to the information and explanations given to us, no undisputed amount payable in respect of outstanding statutory dues were in arrears as at March 31, 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanation given to us, there are no outstanding disputed dues payable by the Company in case of income tax, wealth tax, sales tax, duty of customs, duty of excise, value added tax and cess except service tax and interest on service tax and penalty as on March 31, 2015;

Period to which Sl. Name of the Nature of the amount No Statute Dues relates

Penalty & Finance Act February 2009 1 1994 interest on to June 2010 Service Tax

Finance Act October 2007 to 2 1994 Service Tax August 2009

3 Finance Act Service Tax April 2003 to 1994 February 2008

Name of the Statute Forum where Amount (Rs.) dispute is pending

Finance Act.1994 Customs, Excise Not yet and Service Tax determined. Appellate Tribunal

Finance Act,1994 Customs, Excise 1,56,10,334 and Service Tax (Note 1) Appellate Tribunal

Finance Act,1994 Customs, Excise and 67,547 Service Tax Appellate Tribunal

Note 1: amount is excluding interest and penalty

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

viii. The Company has neither accumulated losses nor incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. In view of the same, the clause (viii) of clause 3 of the order regarding comparison of the net worth with accumulated losses is not applicable.

ix. Based on our audit procedure and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to the financial institution, bank or debenture holders;

x. According to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions. Accordingly the terms and conditions thereof are not prima facie prejudicial to the interests of the Company are not applicable;

xi. In our opinion, and according to the information and explanations given to us and based on the records examined by us the term loan have been applied for the purpose for which the loan were obtained;

xii. During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the period.

For G. M. Kapadia & Co.

Chartered Accountants

(Firm Registration No.104767W)



Chennai Satya Ranjan Dhall

Dated: May 07, 2015 Partner

(Membership No. 214046)

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Mar 31, 2014

We have audited the accompanying consolidated financial statements of Lancor Holdings Limited, its subsidiaries and its joint venture, which comprise the consolidated balance sheet as at March 31, 2014, the consolidated statement of profit and loss and consolidated cash flows statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Consolidated Financial Statements

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

Auditor''s Responsibility

Our responsibility is to express an opinion on these consolidated 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 consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal 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 the opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 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 and based on the consideration of the reports of the other auditors on the financial statements of the subsidiaries as noted below, the consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the consolidated balance sheet, of the state of affairs of the Company as at March 31, 2014;

(ii) in the case of the consolidated statement of profit and loss, of the profit for the year ended on that date; and

(iii) in the case of the consolidated cash flow statement, of the cash flows for the year ended on that date.

Other matter

We did not audit the financial statements of Lancor Maintenance & Services Limited and Lancor Realty Limited, whose financial statements reflect total assets (net) of Rs. 1,152.93 lakhs, total revenues of Rs. 790.82 lakhs and net cash inflows amounting to Rs. (241.67) lakhs for the year then ended. These financial statements have been audited by other auditor whose reports have been furnished to us by the Management and our opinion is based solely on the reports of the other auditors. Our opinion is not qualified in respect of this matter.

INDEPENDENT AUDITOR''S REPORT To the Members of Lancor Holdings Limited Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s 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 the opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 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 financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

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 of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the order.

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 purpose of our audit;

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

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

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

(e) On the basis of written representations received from the directors as on March 31, 2014 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure Re: Lancor Holdings Limited Referred to in paragraph 1 of Report on Other Legal and Regulatory Requirements of our report of even date, of our report of even date

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

(b) As per the plan and programmee of the management certain assets have been physically verified. The programme of verification, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verifications.

(c) The Company has not disposed off any substantial part of its fixed assets during the year.

(ii) (a) The inventory has been physically verified during the year by the management. In our opinion the frequency of verification is reasonable.

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company has maintained proper records of inventory and no discrepancies were noticed on verification between the physical stocks and books of accounts.

(iii) (a) The Company has granted unsecured loans to six Companies and one firm covered in the register maintained under Section 301 of the Companies Act, 1956. At the year-end, the outstanding balances of such loans aggregated to Rs. 50,52,19,168 (excluding interest) and maximum amount outstanding during the year was Rs. 78,28,33,771.

(b) According to the information and explanation given to us, the terms & conditions of loans given to the Company concerned in the register maintained under Section 301 of the Act are not prima-facie prejudicial to the interest of the Company.

(c) According to the information and explanation given to us, and as per the terms and conditions, the Companies are regular in payment of principal and interest. In case of the firm & three companies, as per the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of the principal amount, wherever applicable does not arise.

(d) As stated above, in case of Companies, there are no overdue amounts in excess of rupees one lakh and in case of the firm & three companies, as no repayment schedules have been specified, there are no overdue amounts in excess of Rupees one lakh.

(e) The Company has taken unsecured loan from two Companies covered in the register maintained under section 301 of Companies Act, 1956. The maximum amount involved during the year was Rs. 3,07,63,315 & the year-end balance of such loan taken was Rs. 21,80,050.

(f) The above referred loans taken were interest free and do not carry any other terms and condition other than repayable on demand. In our opinion, the term and conditions on which loan has been taken from the Company covered in the register maintained under section 301 of the Companies Act, 1956 are not prima-facie prejudicial to the interest of the Company.

(g) According to the information and explanation given to us and on our perusal of books of account, as no repayment schedule has been specified the question of regularity of the repayment of the principal amount does not arise.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regards to purchases of inventory, fixed assets and with regard to sale. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

(v) a) Based on the audit procedures applied by us and according to the information and explanation given to us, we are of the opinion that the Company has entered all the transactions required to be entered in the register maintained under section 301 of the Companies Act, 1956.

b) According to sub clause (v) (b) of clause 4 of the Order, the 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 lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public; hence there is no question of complying with the provisions of sections 58A, 58AA or any other provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or Court or any other Tribunal.

(vii) The scope of internal audit needs to be broadened to make it commensurate with the size of the Company and nature of the business.

(viii) We have broadly reviewed the books of account and records maintained by the Company relating to construction and development activity, pursuant to the order made by the Central Government for the maintenance of cost record under section 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete, as the examination of the records are to be made by a cost auditor.

(ix) (a) The Company has generally been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, customs duty and other material statutory dues as applicable. With respect to service tax, certain discrepancy has been found relating to timing of its remittance that arises on reverse charge mechanism.

No undisputed amounts payable in respect thereof are outstanding at the year end for a period of six months from the date they became payable except for Rs. 206,000 in relation to income tax.

Name of Nature of Amount Period to Due Date of the Statute Dues (Rs) which the Date Payment amount relates

Income Tax 206,000 FY 2008-09 May 31, 2009 Not yet Tax Act, 1961 Deduction paid. at Source

(b) According to the information and explanation given to us, there are no dues of sales tax, income tax, custom duty, wealth tax, excise duty or cess and service tax except for interest on service tax and penalty which is under dispute. The Company has filed an appeal before the Custom, Excise and Service Tax Appellate Tribunal (CESTAT) on May 10, 2012.

Sl. No Name of the Nature of Forum where Amount Statute Dues dispute is pending (Rs.)

1. Finance Act Penalty & Custom, Excise and Service Not yet 1994 interest on Tax Appellate Tribunal determined. Service Tax

(x) The Company has neither accumulated losses nor incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. In view of the same, the clause (x) of clause 4 of the order regarding comparison of the net worth with accumulated losses is not applicable.

(xi) In our opinion and according to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not defaulted in repayment of dues to banks or financial institutions. The Company has not issued debentures.

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

(xiii) The Company is not a chit fund or nidhi / mutual benefit fund/ society. Therefore, the sub clause (xiii) of clause 4 of the Order is not applicable to the Company.

(xiv) The Company has maintained proper records of transactions and contracts in respect of its dealings in shares and other investments and timely entries have been made there in. All the investments have been held by the Company in its own name.

(xv) As informed to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loan has been utilized for the purpose for which it has been raised.

(xvii) According to the information and explanations given to us and on an overall examination of the financial statement of the Company, we are of the opinion that no funds raised on short term basis has been used for long term investment by the Company.

(xviii) During the year, the Company has not made any preferential allotment of share to parties and Companies covered in the register maintained under section 301 of the Act. Hence reporting whether the price at which shares have been issued are not prejudicial to the interest of the Company is not required.

(xix) The Company has not issued debentures and hence the sub clause (xix) of clause 4 of the Order is not applicable.

(xx) The Company has not raised money by public issue hence the sub clause (xx) of the clause 4 of the Order is not applicable to the Company.

(xxi) According to the information and explanation given to us by the management and which has been relied by us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For G M Kapadia & Co., Chartered Accountants, Firm''s Registration No. 104767W

Satya Ranjan Dhall Partner Membership No. 214046

Place of Signature: Chennai Date: May 14, 2014

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Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 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 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 in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013

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

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

Report on Other Legal and Regulatory Requirements

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

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 purpose of our audit;

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

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

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

(e) On the basis of written representations received from the directors as on March 31, 2013 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure

Re: Lancor Holdings Limited

Referred to in paragraph 1 of Report on Other Legal and Regulatory Requirements of our report of even date, of our report of even date.

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

(b) All the assets have been physically verified by the management during the year. The programme of verification, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verifications.

(c) The Company has not disposed off any substantial part of its fixed assets during the year.

(ii) (a) The inventory has been physically verified during the year by the management. In our opinion the frequency of verification is reasonable.

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company has maintained proper records of inventory and no discrepancies were noticed on verification between the physical stocks and books of accounts.

(iii) (a) The Company has granted unsecured loans to five Companies and one firm covered in the register maintained under Section 301 of the Companies Act, 1956. At the year-end, the outstanding balances of such loans aggregated to Rs.714,880,205 and maximum amount outstanding during the year was Rs.897,052,310.

(b) According to the information and explanation given to us, the terms & conditions of loans given to the Company concerned in the register maintained under Section 301 of the Act are not prima-facie prejudicial to the interest of the Company.

(c) According to the information and explanation given to us, and as per the terms and conditions, the Companies are regular in payment of principal and interest. In case of the firm & two companies, as per the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of the principal amount, wherever applicable does not arise.

(d) As stated above, in case of Companies, there are no overdue amounts in excess of rupees one lakh and in case of the firm & two companies, as no repayment schedules have been specified, there are no overdue amounts in excess of Rupees one lakh.

(e) The Company has taken unsecured loan from two Companies covered in the register maintained under section 301 of Companies Act, 1956. The maximum amount involved during the year was Rs.4,66,03,057 & the year-end balance of such loan taken was Nil.

(f) In our opinion the rate of interest and the terms and conditions on which loan has been taken from the Company covered in the register maintained under section 301 of the Companies Act, 1956 are not prima-facie prejudicial to the interest of the Company.

(g) According to the information and explanation given to us and on our perusal of books of account, repayment schedule has been specified and accordingly the repayment of the principal amount has been regular.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regards to purchases of inventory, fixed assets and with regard to sale. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

(v) a) Based on the audit procedures applied by us and according to the information and explanation given to us, we are of the opinion that the Company has entered all the transactions required to be entered in the register maintained under section 301 of the Companies Act, 1956.

b) According to sub clause (v) (b) of clause 4 of the Order, the 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 lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public; hence there is no question of complying with the provisions of sections 58A, 58AA or any other provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or Court or any other Tribunal.

(vii) The scope of internal audit needs to be broadened to make it commensurate with the size of the Company and nature of the business.

(viii) We have broadly reviewed the books of account and records maintained by the Company relating to construction and development activity, pursuant to the order made by the Central Government for the maintenance of cost record under section 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete, as the examination of the records are to be made by a cost auditor.

(x) The Company has neither accumulated losses nor incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. In view of the same, the clause (x) of clause 4 of the order regarding comparison of the net worth with accumulated losses is not applicable.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks or financial institutions. The Company has not issued debentures.

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

(xiii) The Company is not a chit fund or nidhi / mutual benefit fund / society. Therefore, the sub clause (xiii) of clause 4 of the Order is not applicable to the Company.

(xiv) The Company has maintained proper records of transactions and contracts in respect of its dealings in shares and other investments and timely entries have been made therein. All the investments have been held by the Company in its own name.

(xv) As informed to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loan has been utilized for the purpose for which it has been raised.

(xvii) According to the information and explanations given to us and on an overall examination of the financial statement of the Company, we are of the opinion that no funds raised on short term basis has been used for long term investment by the Company.

(xviii) During the year, the Company has not made any preferential allotment of share to parties and Companies covered in the register maintained under section 301 of the Act. Hence reporting whether the price at which shares have been issued are not prejudicial to the interest of the Company is not required.

(xix) The Company has not issued debentures and hence the sub clause (xix) of clause 4 of the Order is not applicable.

(xx) The Company has not raised money by public issue hence the sub clause (xx) of the clause 4 of the Order is not applicable to the Company.

(xxi) According to the information and explanation given to us by the management and which has been relied by us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For G M Kapadia & Co.,

Chartered Accountants,

Firm''s Registration No. 104767W

Satya Ranjan Dhall

Partner

Membership No. 214046

Place: Chennai

Date: May 30, 2013

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Mar 31, 2012

1. We have audited the attached Balance Sheet of LANCOR HOLDINGS LIMITED as at March 31, 2012 and the Statement of Profit and Loss for the year ended on that date and Cash Flow Statement for the year under review 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 disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

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

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

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

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

(iv) In our opinion, the Balance Sheet and Statement of Profit and Loss and Cash Flow statement dealt with by this report comply with the accounting standard referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

(v) On the basis of the written representations received from the directors, as on March 31, 2012, and taken on record by the Board of Directors, we report that none of the directors of the Company, i.e. LANCOR HOLDINGS LIMITED as on March 31, 2012 is disqualified from being appointed for appointment as a director in the aforementioned Company in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956 on the said date.

(vi) 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;

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

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

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

Annexure Re: LANCOR HOLDINGS LIMITED

Referred to in paragraph 3 of our report of even date,

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

(b) All the assets have been physically verified by the management during the year. The programme of verification, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) The Company has not disposed off any substantial part of its fixed assets during the year.

(ii) (a) The inventory has been physically verified during the year by the management. In our opinion the frequency of verification is reasonable.

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company has maintained proper records of inventory and no discrepancies were noticed on verification between the physical stocks and books of accounts.

(iii) (a) The Company has granted unsecured loans to two Companies and one firm covered in the register maintained under Section 301 of the Companies Act, 1956. At the year-end, the outstanding balances of such loans aggregated to Rs.33,14,19,974 and maximum amount outstanding during the year was Rs.45,44,09,256.

(b) According to the information and explanation given to us, the terms & conditions of loans given to the Company concerned in the register maintained under Section 301 of the Act are not prima-facie prejudicial to the interest of the Company.

(c) According to the information and explanation given to us, and as per the terms and conditions, the Companies are regular in payment of principal and interest. In case of the firm, as per the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of the principal amount, wherever applicable does not arise.

(d) As stated above, in case of Companies, there are no overdue amounts in excess of rupees one lakh and in case of the firm, as no repayment schedules have been specified, there are no overdue amounts in excess of Rupees one lakh.

(e) The Company has taken unsecured loan from one Company covered in the register maintained under section 301 of Companies Act, 1956. The maximum amount involved during the year was Rs.5,82,393 and the year end balance from such Company was Rs. 5,01,011.

(f) In our opinion the rate of interest and the terms and conditions on which loan has been taken from the Company covered in the register maintained under section 301 of the Companies Act, 1956 are not prima-facie prejudicial to the interest of the Company.

(g) According to the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of the principal amount, wherever applicable does not arise.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regards to purchases of inventory, fixed assets and with regard to sale. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

(v) a) Based on the audit procedures applied by us and according to the information and explanation given to us, we are of the opinion that the Company has entered all the transactions required to be entered in the register maintained under section 301 of the Companies Act, 1956.

b) According to sub clause (v) (b) of clause 4 of the Order, the 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 lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public; hence there is no question of complying with the provisions of sections 58A, 58AA or any other provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or Court or any other Tribunal.

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

(viii) We have broadly reviewed the books of account and records maintained by the Company relating to construction and development activity, pursuant to the order made by the Central Government for the maintenance of cost record under section 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete, as the examination of the records are to be made by a cost auditor.

(ix) (a) The Company has generally been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, customs duty, and other material statutory dues as applicable. No undisputed amounts payable in respect thereof are outstanding at the year end for a period of six months from the date they became payable except for Rs. 206,000 in relation to income tax.

Name of the Nature of Dues Amount (Rs) Period to which the Due Date Date of Statute amount relates Payment

Income Tax Tax Deduction 206,000 FY 2008-09 May 31, 2009 Not yet paid. Act, 1961 at Source

(b) According to the information and explanation given to us, there are no dues of sales tax, income tax, custom duty, wealth tax, excise duty or cess and service tax except for interest on service tax and penalty which is under dispute. The Company has filed an appeal before the Custom, Excise and Service Tax Appellate Tribunal (CESTAT) on May 10, 2012.

Sl. No Name of the Nature of Dues Forum where dispute is Amount (Rs.) Statute pending

1. Finance Act Penalty & interest on Custom, Excise and Not yet determined. 1994 Service Tax Service Tax Appellate Tribunal

(x) The Company has neither accumulated losses nor incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. In view of the same, the clause (x) of clause 4 of the order regarding comparison of the net worth with accumulated losses is not applicable.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks or financial institutions. The Company has not issued debentures.

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

(xiii) The Company is not a chit fund or nidhi / mutual benefit fund/ society. Therefore, the sub clause (xiii) of clause 4 of the Order is not applicable to the Company.

(xiv) The Company has maintained proper records of transactions and contracts in respect of its dealings in shares and other investments and timely entries have been made there in. All the investments have been held by the Company in its own name.

(xv) As informed to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loan has been utilized for the purpose for which it has been raised.

(xvii) According to the information and explanations given to us and on an overall examination of the financial statement of the Company, we are of the opinion that no funds raised on short term basis has been used for long term investment by the Company.

(xviii) During the year, the Company has not made any preferential allotment of share to parties and Companies covered in the register maintained under section 301 of the Act. Hence reporting whether the price at which shares have been issued are not prejudicial to the interest of the Company is not required.

(xix) The Company has not issued debentures and hence the sub clause (xix) of clause 4 of the Order is not applicable.

(xx) The Company has not raised money by public issue hence the sub clause (xx) of the clause 4 of the Order is not applicable to the Company.

(xxi) According to the information and explanation given to us, no fraud on or by the Company has been noticed during the course of our audit.

For G.M. Kapadia and Co.

Chartered Accountants

Firm Registration No: 104767W

Satya Ranjan Dhall

Chennai Partner

Dated: May 30, 2012 Membership No. 214046

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Mar 31, 2010

1. We have audited the attached Balance Sheet of LANCOR HOLDINGS LIMITED as at March 31, 2010 and the Profit and Loss Account for the year ended on that date and Cash Flow Statement for the year under review annexed thereto. These financial statements are the responsibility of the Companys management. Our responsi- bility 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 disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act 1956, we enclose in the Annexure a state- ment on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

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

(iv) In our opinion, the Balance Sheet and Profit and Loss and Cash Flow statement account dealt with by this report comply with the accounting standard referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

(v) On the basis of the written representations received from the directors, as on March 31, 2010, and taken on record by the Board of Directors, we report that none of the directors of the Company, i.e. LANCOR HOLD- INGS LIMITED as on March 31, 2010 is disqualified from being appointed for appointment as a director in the aforementioned Company in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956 on the said date.

(vi) 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;

(a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2010; and

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

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

Re: LANCOR HOLDINGS LIMITED Referred to in paragraph 3 of our report of even date,

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

(b) All the assets have been physically verified by the management during the year. The Programme of verification, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) The Company has not disposed off any substantial part of its fixed assets during the year.

(ii) (a) The inventory has been physically verified during the year by the management. In our opinion the frequency of verification is reasonable.

(b) The procedures of physical verification of Inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The Company has maintained proper records of inventory and no discrepancies were noticed on verification between the physical stocks and books of accounts.

(iii) (a) As informed to us, the company has not granted any loans, secured or unsecured to / from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the sub clause (iii)(b), regarding nature of terms and conditions of such loans, sub clause (iii)(c), regarding regularity of repayment of such loans/interests and sub clause (iii)(d) regarding overdue amount in case of such loans, of clause 4 of the Order are not applicable.

(b) The Company has taken unsecured loan from one party and one Company covered in the register maintained under section 301 Companies Act, 1956. The maximum amount involved during the year was Rs.87,500,000 and the year end balance taken on loan from such party was Rs. 24,308,706.

(c) In our opinion the rate of interest and the terms and conditions on which loan has been taken from the party and the Company covered in the register maintained under section 301 of the Companies Act, 1956 are not prima- facie prejudicial to the interest of the Company.

(d) According to the information and explanation given to us, no repayment schedule has been specified and accordingly the regularity in repayment of the principal amount, wherever applicable does not arise.

(e) As stated above, no repayment schedules have been specified and there are no other due amounts in excess of Rupees one lakh.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regards to purchases of inventory, fixed assets and with regard to sale. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

(v) a) Based on the audit procedures applied by us and according to the information and explanation given to us, we are of the opinion that the company has entered all the transactions required to be entered in the register maintained under section 301 of the Companies Act, 1956.

b) According to sub clause (v) (b) of clause 4 of the Order, the 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 lakhs in respect of any party during the year have been made a* prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public; hence there is no question of complying with the provisions of sections 58A, 58AA or any other provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or Court or any other Tribunal.

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

(viii) The Central Government has not prescribed maintenance of cost records under section 209(1) (d) of the Companies Act, 1956.

(ix) (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, customs duty, and other material statutory dues as applicable. No undisputed amounts payable in respect thereof are outstanding at the year end for a period of six months from the date they became payable except Rs. 206,000 towards income tax.

Name of the Nature of Amount Period to which Statute Dues Rs. the amount relates

Income Tax Act, 1961 Tax Deduction 206,000 FY 2008-09 at Source

Name of the Due Date Date of Statute Payment

Income Tax Act May 31, 2009 Not yet paid. 1961

(b) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, service tax, excise duty or cess, which have not been deposited on account of any dispute.

(x) The Company has neither accumulated losses nor incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. In view of the same, the clause (x) of clause 4 of the order regarding comparison of the net worth with accumulated losses is not applicable.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks or financial institutions. The Company has not issued debentures.

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

(xiii) The Company is not a chit fund or nidhi / mutual benefit fund/ society. Therefore, the sub clause (xiii) of clause 4 of the Order is not applicable to the Company.

(xiv) The Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the sub clause (xiv) of clause 4 of the Order is not applicable to the Company. However proper records are maintained for the Investments made by the company.

(xv) As informed to us, the Company has not given guarantees for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loan has been utilized for the purpose for which it has been raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet and cash flow of the Company, we report that no funds raised on short term basis has been used for long term investment by the Company.

(xviii)During the year, the Company has not made preferential allotment of share to parties and companies covered in the register maintained under section 301 of the Act.

(xix) The Company has not issued debentures and hence the sub clause (xix) of clause 4 of the Order is not applicable.

(xx) The Company has not raised money by public issue.

(xxi) According to the information and explanation given to us, no fraud on or by the Company has been noticed during the course of our audit.

K.Y.Narayana

Chennai Partner

Dated: June 14, 2010 Membership No. 60639

Firm Registration No: 104767W