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Auditor Report of LKP Finance Ltd.

Mar 31, 2015

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

Management''s Responsibility for the 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 the 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 the financial statements based on our audit.

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit/loss 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"), as issued by Central Government of India in terms of sub section (11) of section 143 of Companies Act, 2013 (18 of 2013) we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

a. we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014 ; and

e. on the basis of written representations received from the directors as on 31st March 2015, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2015, from being appointed as a director in terms of sub section (2) of section 164 of the Companies Act, 2013.

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 a pending litigations in the Honorable High Court of Mumbai in the matter explained under Note No.C1 of the Notes to financial statements as at 31st March, 2015. We are informed that the case when heard and disposed off will neither have cash outgo nor will have impact on the Statement of Profit and Loss for the year;

ii. As represented by the company, there are no long-term contracts including derivative contracts having material foreseeable losses other than those disclosed in note No.C17 in the Notes to financial statements as at 31st March, 2015;

iii. As represented by the company, there is no amount required to be transferred to Investor Education and Protection Fund by the Company.

Annexure to the Auditors'' Report

[Referred to in paragraph pertaining to "Report on Other Legal and Regulatory Requirement" of our Report of even date to the members of LKP Finance Limited on the financial statements for the year ended 31st March, 2015]

1. a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.

b) Fixed Assets have been physically verified by the management during the year and no discrepancies between the book records and the physical inventory have been noticed. In our opinion, the frequency of verification is reasonable.

2. a) The inventory of stocks held for sale has been verified

by the management during the year. In our opinion, the frequency of verification is reasonable.

b) In our opinion, the procedures of verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) On the basis of our examination of the inventory records, in our opinion, the company is maintaining proper records of inventory. There are no discrepancies noticed on verification of inventory as compared to book records.

3. The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under-Section 189 of the Companies Act, 2013.

4. In our opinion and according to the information and explanations given to us, having regard to the explanation there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventories and fixed asset and for sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weakness in the aforesaid internal control system.

5. The Company has not accepted any deposits from the public, within the meaning of Sections 73 to 76 of Companies Act 2013 and the rules framed there under.

6. We are informed by the Company sub section (1) of section 148 of the Act is not applicable.

7. a) According to the information and explanations given to

us and records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, value added tax, wealth tax, service tax, custom duty, excise duty, cess and any other material statutory dues as applicable with the appropriate authorities. There are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31st March, 2015.

b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income tax, wealth tax, service tax, customs duty and cess as at 31st March 2015, which has not been deposited on account of dispute.

c) According to the information and explanations given to us and records ofthe Company examined by us, in our opinion, there are no amounts payable to investor education and protection fund in accordance with the relevant provisions of Companies Act, 1956 (1 of 1956) and rules there under.

8. The Company has no accumulated losses as at 31st March, 2015 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

9. According to the information and explanations given to us and records of the Company examined by us the company has not defaulted in repayment of dues to any financial institution or bank at the Balance Sheet date.

10. According to the information and explanations given to us the Company has not given any guarantees for loans taken by others from banks or financial institution during the year except a existing guarantee of Rs.8 Crores given to a bank in respect of a facility to its subsidiary and the terms and conditions whereof are not prejudicial to the interest of the Company.

11. The Company has not obtained any term loans except a car loan. The balance outstanding as at 31st March, 2015 is Rs.6,09,406/- (Previous Year Rs.15,75,092)

12. Based on the audit procedures performed and information and explanations given by the management, we report that we have not come across any instances of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by management.

For Ford, Rhodes, Parks & Co. Chartered Accountants Firm registration number: 102860W

A.D.Shenoy Place : Mumbai Partner Date : 5th May, 2015 Membership number: 11549


Mar 31, 2014

We have audited the accompanying financial statements of LKP Finance Limited ("the Company") which comprise the balance sheet as at 31 March 2014, the statement of profit and loss and the cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the 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 materia] 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:

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

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, 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; and

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

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

Annexure to the Auditors'' Report

The Annexure referred to in our report to the members of LKP Finance Limited ("the Company") for the year ended 31 March 2014. We report that:

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

(b) During the year the Company has carried out physical verification of Assets. No discrepancy was noticed on such physical verification as compared with fixed asset register.

(c) During the year the Company has not disposed off any substantial part of its fixed assets so as to affect the going concern.

2. The company does not have any stock of raw materials, stores, spare parts, finished goods and therefore clause ii (a), (b), (c) (of the Order) are not applicable.

3. The company has neither taken for granted any loans, secured or unsecured from Companies, firms or any other parties covered in the register maintained under Section 301 of the Companies Act, 1956 except for an interest free unsecured short term loan granted to two of its subsidiaries. The amount due as on 31st March 2014 is Rs 1603.82 lacs. There are no stipulations as to repayment of principal.

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

5. (a) On the basis of our examination of the books of account and according to the information and explanations provided by the Management, we are of the opinion that the transactions that need to be entered into the register in pursuance of Section 301 of the Act have been so entered in the said register.

(b) In our opinion and according to the information and explanations given to us the contracts and arrangements (as referred in Section 301) have been made at prices which are reasonable having regard to the prevailing market price at relevant date.

6. The company has not accepted any deposits from the public within the meaning of the provision of Section 58A and 58AA of the Act.

7. During the year the company has appointed an independent Chartered Accountant to carry out Internal Audit of the Company. The Scope and coverage of the Internal Audit is commensurate with the size and nature of business.

8. The Company is a Loan and Investment Company hence clause (viii) of the Order is not applicable.

9. (a) According to the information and explanations given to us by the Management and on the basis of the examination of the books of account carried out by us, the Company has been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, and other statutory dues with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us by the Management and the records of the company examined by us there are no disputes pending with tax authorities as at 31st March, 2014.

10. The Company has no accumulated losses as on 31st March, 2014 and the Company has not incurred any cash losses during the current financial year as also in the immediate preceding year.

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

12. As per the books and records of the company examined by us, the Company has granted loans against pledge of shares and proper records have been maintained.

13. Clause (xiii) of the Order is not applicable as the company is not a Chit Fund Company or nidhi /mutual benefit fund /society.

14. In our opinion the Company has maintained proper records of transactions and contracts in respect of dealing and trading in shares, securities, debentures and other investments during the year and timely entries have been generally made therein. All shares, debentures and other investments have been held by the company in its own name.

15. The Company has given a guarantee to a Bank for Rs 8.00 crores on behalf of its Subsidiary, where the terms and conditions are not prejudicial to the interests of the company.

16. The Company has not availed term loans except loan for purchase of vehicle.

17. According to the information and explanations given to us and on''an overall examination of the balance sheet of the Company, we report that no funds raised on short term basis have been used for long term investments.

18. The Company has not made any preferential allotment of shares during the year.

19. The Company has not issued any Debentures so creating a charge on the assets of the Company does not arise

20. The Company has not raised any money by way of public issue during the year and therefore paragraph 4(xx) of the Order is not applicable.

21. According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of the audit.

For Ford, Rhodes, Parks & Co.

Chartered Accountants

Firm registration number: 102860W

A.D.Shenoy

Place : Mumbai Partner

Date : 9th May 2014 Membership number: 011549


Mar 31, 2013

We have audited the accompanying financial statements of LKP Finance Limited ("the Company") which comprise the balance sheet as at 31 March 2013, the statement of profit and loss and the cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the 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:

(i) in the case of the balance sheet, of the state of affairs of the Company as at 31 March 2013;

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, 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; and

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

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

Annexure to the Auditors'' Report

The Annexure referred to in our report to the members of LKP Finance Limited ("the Company") for the year ended 31 March 2013. We report that:

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

(b) During the year the Company has carried out physical verification of Assets. No discrepancy was noticed on such physical verification as compared with fixed asset register.

(c) During the year the Company has not disposed off any substantial part of its fixed assets so as to affect the going concern.

2. The company does not have any stock of raw materials, stores, spare parts, finished goods and therefore clause ii (a), (b), (c) (of the Order) are not applicable.

3. The company has neither taken nor granted any loans, secured or unsecured from Companies, firmsor any other parties covered in the register maintained under Section 301 of the Companies Act, 1956 except for an interest free unsecured short term loan granted to one of its subsidiaries. The amount due as on 31st March 2013 is Rs 278.63 lacs. There are no stipulations as to repayment of principal.

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

5. (a) On the basis of our examination of the books of account and according to the information and explanations provided by the Management, we are of the opinion that the transactions that need to be entered into the register in pursuance of Section 301 of the Act have been so entered in the said register.

(b) In our opinion and according to the information and explanations given to us the contracts and arrangements (as referred in Section 301) have been made at prices which are reasonable having regard to the prevailing market price at relevant date.

6. The company has not accepted any deposits from the public within the meaning of the provision of Section 58A and 58AA of the Act.

7. During the year the company has appointed an independent Chartered Accountant to carry out Internal Audit of the Company. The Scope and coverage of the Internal Audit is commensurate with the size and nature of business.

8. The Company is a Loan and Investment Company hence clause (viii) of the Order is not applicable.

9. (a) According to the information and explanations given to us by the Management and on the basis of the examination of the books of account carried out by us, the Company has been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, and other statutory dues with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2013 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us by the Management and the records of the company examined by us there are no disputes pending with tax authorities as at 31st March, 2013.

10. The Company has no accumulated losses as on 31st March, 2013 and the Company has not incurred any cash losses during the current financial year as also in the immediate preceding year.

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

12. As per the books and records of the company examined by us, the Company has granted loans against pledge of shares and proper records have been maintained.

13. Clause (xiii) of the Order is not applicable as the company is not a Chit Fund Company or nidhi /mutual benefit fund /society.

14. In our opinion the Company has maintained proper records of transactions and contracts in respect of dealing and trading in shares, securities, debentures and other investments during the year and timely entries have been generally made therein. All shares, debentures and other investments have been held by the company in its own name.

15. The Company has given a guarantee to a Bank for Rs 8.00 crores on behalf of its Subsidiary, where the terms and conditions are not prejudicial to the interests of the company.

16. The Company has not availed term loans except loan for purchase of vehicle.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short term basis have been used for long term investments.

18. The Company has not made any preferential allotment of shares during the year.

19. The Company has not issued any Debentures so creating a charge on the assets of the Company does not arise

20. The Company has not raised any money by way of public issue during the year and therefore paragraph 4(xx) of the Order is not applicable.

21. According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of the audit.

For Ford, Rhodes, Parks & Co.

Chartered Accountants

Firm registration number: 102860W

A. D. Shenoy

Place : Mumbai Partner

Date : 29th April 2013 Membership number: 011549


Mar 31, 2012

We have audited the attached Balance Sheet of LKP Finance Limited as at 31st March 2012 and the statement of Profit & Loss of the Company for the year ended on that date annexed thereto and also the Cash Flow Statement for the year ended on that date. 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.

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

1. As required by the Companies (Auditors Report) Order, 2003 (as amended), issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956 (the Act) and on the basis of such checks, as we considered appropriate, we give in Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. Further to our comments in paragraph 1 above:

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 accounts as required by law have been kept by the company so far as appears from our examination of the books.

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

d) In our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow statement dealt with by the report are in compliance with the accounting standards referred to in section 211(3C) of the Companies Act, 1956.

e) On the basis of written representations received from the directors of the Company as on 31st March, 2012 and taken on record by the Board of Directors of the Company none of the directors of the Company is disqualified as on 31st March, 2012 from being appointed as a Director in terms of clause (g) of the sub-section (1) of Section 274 of the Companies Act, 1956.

3. In our opinion and to the best of our information and according to the explanations given to us the accounts read together with notes thereon, 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 principle generally accepted in India:

(a) In the case of the Balance Sheet of the state of affairs of the Company as at 31sst March 2012.

(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 REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS REPORT

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

(b) During the year the Company has carried out physical verification of Assets. On verification, certain items which were not serviceable and not in good condition were written off. The total amount written off to the Statement of Profit AND Loss on above account is Rs. 7,10,321/-.

(c) During the year the company has not disposed off any substantial part of its fixed assets so as to affect the going concern.

2. The company does not have any stock of raw materials, stores, spare parts, finished goods and therefore clause ii (a), (b), (c) (of the Order) are not applicable.

3. The company has neither taken nor granted any loans, secured or unsecured from Companies, firms or any other parties covered in the register maintained under Section 301 of the Companies Act, 1956 except for an interest free unsecured short term loan granted to two subsidiaries. The amount due from the two subsidiaries as on 31st March 2012 is Rs 14.04 Crores.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of fixed assets and for services provided. During the course of our audit, we have neither come across nor have we been informed of any major weaknesses in the aforesaid internal control procedures.

5. (a) On the basis of our examination of the books of account and according to the information and explanations provided by the Management, we are of the opinion that the transactions that need to be entered into the register in pursuance of Section 301 of the Act have been so entered in the said register. '

(b) In our opinion and according to the information and explanations given to us the contracts and arrangements (as referred in Section 301) have been made at prices which are reasonable having regard to the prevailing market price at relevant date.

6. The company has not accepted any deposits from the public within the meaning of the provision of Section 58A and 58AA of the Act.

7. During the year the company has appointed an independent Chartered Accountant to carry out Internal Audit of the Company. The Scope and coverage of the Internal Audit is commensurate with the size and nature of business.

8. The Company is a Loan and Investment Company hence clause (viii) of the Order is not applicable.

9. (a) According to the information and explanations given to us by the Management and on the basis of the examination of the books of account carried out by us, the Company has been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, and other statutory dues with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2012 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us by the Management and the records of the company examined by us there was one dispute(A. Y 03-04) pending before Income Tax Appellate Tribunal and the demand is NIL.

10. The Company has no accumulated losses as at the beginning of the year and as at 31st March 2012.

11. Based on our audit procedures and the information and explanations given to us by the Management, we are of the opinion that the Company has not availed any Loans from Financial Institutions and hence default in repayment of dues does not arise

12. As per the books and records of the company examined by us, the Company has granted loans against pledge of shares and proper records have been maintained.

13. Clause (xiii) of the Order is not applicable as the company is not a Chit Fund Company or nidhi /mutual benefit fund /society.

14. In our opinion the Company has maintained proper records of transactions and contracts in respect of dealing and trading in shares, securities, debentures and other investments during the year and timely entries have been generally made therein. All shares, debentures and other investments have been held by the company in its own name.

15. The Company has given a guarantee to a Bank for Rs 8.00 crores on behalf of its Subsidiary, where the terms and conditions are not prejudicial to the interests of the company.

16. The company has not taken any term loans.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short term basis have been used for long term investments.

18. The Company has not made any preferential allotment of shares during the year.

19. The Company has not issued any Debentures so security or charge in that respect does not arise

20. The Company has not raised any money by way of public issue during the year and therefore paragraph 4(xx) of the Order is not applicable.

21. According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of the audit.

For Ford, Rhodes, Parks & Co.

Chartered Accountants

Firm Registration No. 102860W

A.D.Shenoy

Mumbai, Partner

Date: 24th April, 2012 Membership No.11549

 
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