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Auditor Report of Mukand Engineers Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of M/s Mukand Engineers Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, 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 these financial statements to 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 referred to in 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 are 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 financial statements based on our audit. We have taken into account the provisions of the Act and the Rules made there under including the Accounting and Auditing Standards and matters which are required to be included in the audit report.

We have 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 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 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 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 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.

Emphasis of Matter

Without qualifying our opinion, we draw your attention to:

(i) Note No. 28 to the financial statements, relating to overdue loans, aggregating Rs. 8,05,50,000/- (Previous Year Rs. 10,14,50,000/-) and Interest Receivable thereon, aggregating Rs. 4,29,57,419/- (Previous Year Rs. 4,29,57,419/-), at the end of the year, that are due from investment companies whose net worth have eroded. The Management's assessment on the recoverability from the financial assets of these companies is subject to uncertainties and which if do not materialize, could significantly impact the carrying values of the aforesaid loans & interest thereon.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 issued by the Central Government of India in terms of sub- section (11) of the section 143 of the Act (hereinafter referred to as "the Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraph 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 specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e. On the basis of 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 knowledge and belief and according to the information and explanations given to us:

i. The Company has disclosed the impact of pending litigations as at March 31, 2015 on its financial position in its financial statements as referred to in Note 27 to the financial statements.

ii. The Company has made provision as at March 31,2015 as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts. The Company has not entered in to any Derivative Contracts during the financial year.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31,2015.

ANNEXURE TO INDEPENDENT AUDITORS' REPORT

(The Annexure referred to in our report to the members of Mukand Engineers Limited ('the Company') for the year ended March 31, 2015.)

(i) In respect of its Fixed Assets:

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

(b) As per the explanation given to us, the Fixed Assets were physically verified by the Management in accordance with a regular programme covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, the management during the year has physically verified a portion of the fixed assets and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and nature of its assets.

(ii) In respect of its Inventories:

(a) The inventory excluding stocks with sub contractors/third parties and Work- in-Progress has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable.

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

(c) On the basis of our examination of the inventory records, we are of the opinion that the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

(iii) The Company has not granted any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under section 189 of the Act during the year. Consequently, clauses (iii) (a) and (iii) (b) of paragraph 3 of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items of purchase/services availed are of special nature for which suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and for the 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 explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) In our opinion and according to the information and explanations given to us, the Company has generally complied with the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules, 2014 to the extent notified, with regard to deposits accepted from the public. The Company not being an "Eligible Company" as defined in Companies (Acceptance of Deposits) Rules, 2014, sought and obtained the approval from the Company Law Board for extension in time limit for Repayment of Public Deposits outstanding as on March 31 2015 on the respective due dates of maturity.

(vi) In our opinion and according to the information and explanations given to us, the Company is not required to maintain cost records prescribed under sub section (1) of Section 148 of the Act, as the Central Government has not specified the maintenance of cost records for any of the products/services of the Company.

(vii) In respect of Statutory Dues:

(a) According to the information and explanations given to us and the 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, Sales Tax including Value Added Tax, Service Tax, Entry Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. There were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.

According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Entry Tax, Cess and other material statutory dues in arrears as on 31st March,2015 for a period of more than six months from the date they become payable.

(b) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the disputed statutory dues in respect Income Tax, Works Contract Tax, Entry Tax and Cess as at 31st March, 2015 which have not been deposited on account of a dispute, are as under:

Nature of Amount Period to Forum where the dues Rs which the dispute is pending amount relates

Income Tax 86,22,250 2000-01 , 2001- High Court of 2002 Bombay

Income Tax 84,55,448 1999-2000 Income Tax 2005-2006 Appellate Tribunal

Income Tax 638,879 2010-2011 and Commissioner of 2011-12 Income Tax

Income Tax 97,62,006 2002-2003 to Income Tax 2011-2012 Department Authorities

Works 7,583,974 2001-02 and High Court Contracts 2002-03 Tax

Works 11,511,927 2001-02 to Sales Tax Contracts 2004-05 Department Tax Authorities

Entry Tax 811,173 1999-00 to High Court, Odisha 2002-03

Entry Tax 1,27,835 2003-04 Asst. Commissioner (Sales Tax)

According to the information and explanations given to us and

the records of the Company examined by us, there are no dues of wealth-tax, service-tax and excise duty which have not been deposited on account of any dispute.

(c) According to information and explanations given to us, the amount required to be transferred to the Investor Education and Protection Fund has been transferred within the stipulated time in accordance with the provisions of the Companies Act, 1956 and the rule made there under.

(viii) In our opinion and according to information & explanations given to us the Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

(ix) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holders.

(x) In our opinion and according to information & explanations given to us and the representations made by the Management, the terms and conditions at which the guarantees given by the Company for loans taken from financial institutions and/ or banks by others, are prima facie not prejudicial to the interests of the Company.

(xi) In our opinion and according to information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they 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, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

GIRISH M. PATHAK Partner Membership No. 102016 For and on behalf of K.K.MANKESHWAR & CO., Chartered Accountants FRN- 106009W

Mumbai, dated the 28th May, 2015


Mar 31, 2014

We have audited the accompanying financial statements of M/s Mukand Engineers Limited ("the Company"), which comprise the Balance Sheet as at March 31,2014, 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 13th September, 2013 issued by 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 and other applicable authoritative pronouncements 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 entity''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the 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.

Emphasis of Matter

Without qualifying our opinion, we draw your attention to:

(i) Note No. 28.1 to the financial statements, relating to overdue loans, aggregating Rs.10,14,50,000/- (Previous Year Rs. 10,34,00,000/-) and Interest Receivable thereon, aggregating Rs. 4,29,57,419/- (Previous Year Rs. 4,95,48,194/-), at the end of the year, that are due from investment companies whose net worth have eroded. The Management''s assessment on the recoverability from the financial assets of these companies is subject to uncertainties and which if do not materialize, could significantly impact the carrying values of the aforesaid loans & interest thereon.

(ii) Note No. 30 to the financial statements, relating to the change in accounting policy during the year in respect of valuation of contract work in progress, resulting into increase in Profit before tax by Rs. 2,63,81,549/-

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended the Companies (Auditor''s Report) (Amendment) Order, 2004, ("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 sub-section (3C) of Section 211 of the Act read with the General Circular 15/2013 dated 13th September, 2013 issued by 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 Act.

ANNEXURE TO INDEPENDENT AUDITOR''S REPORT (The Annexure referred to in our report to the members of Mukand Engineers Limited (''the Company'') for the year ended March 31,2014.)

(i) In respect of its Fixed Assets:

(a) The Company has generally maintained proper records showing full particulars, including quantitative details and situation offixed assets;

(b) As per the explanation given to us, the Fixed Assets were physically verified by the Management in accordance with a regular program covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, a portion of the fixed assets have been physically verified by the management during the year. As per the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the fixed assets disposed off during the year do not constitute a substantial part of fixed assets of the Company and such disposal has not affected the going concern status of the Company.

(ii) In respect of its Inventories:

(a) The inventory excluding stocks with sub contractors/ third parties and Work- in-Progress has been physically verified by the management during the year. In our opinion, the frequency ofverification is reasonable.

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

(c) On the basis of our examination of the inventory records, we are of the opinion that the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under section 301 of the Act. Consequently, clauses (iii) (a) to (iii) (g) of paragraph 4 of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items of purchase/services availed are of special nature for which suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examina -tion of the books and records of the Company, and according to the information and explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Act, to the best of our knowledge and belief and according to information and explanations given to us:

(a) The particulars of contracts or arrangements referred to in Section 301 that needed to be entered in the Register have been so entered.

(b) Where each of such transaction is in excess of Rupees Five Lacs in respect of any party, transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58 A and 58AA or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules 1975 with regards to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

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

(viii) In respect of Statutory Dues:

(a) According to the information and explanations given to us and the 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, Sales Tax, Service Tax, Entry Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. There were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.

(b) According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Entry Tax, Cess and other material statutory dues in arrears as on 31st March,2014 for a period of more than six months from the date they become payable.

(c) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the disputed statutory dues in respect Income Tax, Service Tax, Customs Duty, Excise Duty, Works Contract Tax, Entry Tax and Cess unpaid as at the last day of the financial year, are as under:

Nature of dues Amount Period to Forum where which the the dispute is amount pending relates

Income Tax 11,309,594 2000-01,2001-02 High Court of Bombay and 2002-03

Income Tax 8,455,448 1999-2000 Income Tax 2005-06 Appellate Tribunal

Income Tax 183,504 2009-10 Commissioner of Income Tax

Income Tax 7,310,187 2002-03 to Income Tax Department 2009-10 Authorities

Works 2,472,505 2001-02 to Sales Tax Contracts Tax 2004-05 Department Authorities

Entry Tax 811,713 1999-2000 High Court to 2002-03

Entry Tax 127,835 2003-04 Asst. 1999-2000 Commissioner (Sales Tax)

(ix) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year;

(x) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holder;

(xi) In our opinion and according to information & explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

(xii) In our opinion and according to information & explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. All the investments are held by the Company, in its own name;

(xiii) In our opinion and according to information & explanations given to us and the representations made by the Management, the terms and conditions at which the guarantees given by the Company for loans taken from financial institutions and/ or banks by others, are prima facie not prejudicial to the interests of the Company;

(xiv) In our opinion and according to information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xv) On the basis of review of utilization of funds on an overall basis, related information as made available to us and examination of the financial statements of the Company, we are of the opinion that prima facie short term funds have not been used for long term purposes during the year;

(xvi) According to the information and explanations given to us, the Company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under Section 301 of the Companies Act;

(xvii) According to information and explanations given to us, the Company has not issued any debentures during the year.

(xviii) The Company has not raised any monies by public issue during the year under review;

(xix) 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, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

Looking at the nature of activities being carried on, at present, by the Company, and also considering the nature of matters referred to in various clauses of the Order, as amended, issued by the Central Government in terms of Section 227 (4A) of the Act, clauses (viii) & (xiii) of paragraph 4 of the aforesaid Order, are in our opinion, not applicable to the Company.

GIRISH M. PATHAK Partner Membership No. 102016

For and on behalf of K.K.MANKESHWAR & CO., Chartered Accountants FRN - 106009W

Mumbai, dated the 28th May, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of M/s Mukand Engineers Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, 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

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in 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:

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

(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.

Emphasis of Matter

Without qualifying our opinion, we draw your attention to:

(i) Note No. 28.1 to the financial statements, relating to overdue loans, aggregating Rs.103,400,000 (Previous Year Rs. 103,400,000/-) and Interest Receivable thereon, aggregating Rs. 49,548,194/- (Previous Year Rs. 49,548,194/-), at the end of the financial year, that are due from investment companies whose net worth have eroded. The Management''s assessment on the recoverability from the financial assets of these companies is subject to uncertainties and which, if do not materialize, could significantly impact the carrying values of the aforesaid loans & interest thereon.

(ii) Note No. 30 to the financial statements, relating to the change in accounting policy during the financial year in respect of threshold limits to be applied for Income Recognition, resulting into an increase in Revenue by Rs. 107,735,676/- and Profit before tax by Rs. 5,707,456/-.

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 sub-section (3C) of section 211 of the Act;

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 Act.

ANNEXURE TO INDEPENDENT AUDITOR''S REPORT

(The Annexure referred to in our report to the members of the Company for the year ended March 31, 2013.)

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

(b) As per the explanation given to us, the Fixed assets were physically verified by the Management in accordance with a regular programme covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets have been physically verified by the Management during the year. As per the information and explanations given to us, no materia) discrepancies were noticed on such verification.

(c) Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the fixed assets disposed off during the year do not constitute a substantial part of fixed assets of the Company and such disposal has not affected the going concern status of the Company.

(ii) (a) The inventory excluding stocks with sub contractors/ third parties and Work- in-Progress has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable.

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

(c) On the basis of our examination of the inventory records, we are of the opinion that the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under section 301 of the Act. Consequently, clauses (iii) (a) to

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

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items of purchase/services availed are of special nature for which suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and for the 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 explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Act, to the best of our knowledge and belief and according to information and explanations given to us:

(a) The particulars of contracts or arrangements referred to in Section 301 that needed to be entered in the Register have been so entered.

(b) Where each of such transaction is in excess of Rupees Five Lacs in respect of any party, transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58 A and 58AA or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules 1975, with regards to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

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

(viii) (a) According to the information and explanations given to us and the 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, Sales Tax, Service Tax, Entry Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. The Company has identified certain un- reconciled VAT balances relating to earlier years and the adjustment towards amounts, if any, will be carried out on compilation and confirmation of the reconciliations. There were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.

(b) According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Entry Tax, Cess and other material statutory dues in arrears as on 31 st March,2013 for a period of more than six months from the date they become payable.

(c) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the disputed statutory dues in respect Income Tax, Service Tax, Customs Duty, Excise Duty, Works Contract Tax, Entry Tax and Cess unpaid as at the last day of the financial year, are as under:

Nature of Amount Period to dues Rs. which the amount relates

Income Tax 8,622,250 2000-2001 and 2001-2002

Income Tax 1,309,112 1999-2000

7,146,336 2005-2006

Income Tax 183,504 2009-2010

Income Tax 9,340,669 2002-2003 to 2009-2010

Works 2,472,505 2001-2002 Contracts to Tax 2004-2005

Entry Tax 852,181 1999-2000 to 2002-2003

Entry Tax 86,827 2003-2004

Nature of dues Forum where the dispute is pending

Income Tax High Court of Bombay

Income Tax Income Tax Appellate Tribunal

Income Tax Commissioner of Income Tax

Income Tax Income Tax Department Authorities

Works Contracts Tax Sales Tax Department Authorities

Entry Tax High Court

Entry Tax Asst Commissioner (Sales Tax)

(ix) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year;

(x) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holder;

(xi) In our opinion and according to information & explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

(xii) In our opinion and according to information & explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. All the investments are held by the Company, in its own name;

(xiii) In our opinion and according to information & explanations given to us and the representations made by the Management, the terms and conditions at which the guarantees given by the Company for loans taken from financial institutions and/ or banks by others, are prima facie not prejudicial to the interests of the Company;

(xiv) In our opinion and according to information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xv) On the basis of review of utilization of funds on an overall basis, related information as made available to us and examination of the financial statements of the Company, we are of the opinion that prima facie short term funds have not been used for long term investment during the year;

(xvi) According to the information and explanations given to us, the Company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act;

(xvii) According to information and explanations given to us, the Company has not issued any debentures during the year.

(xviii) The Company has not raised any monies by public issue during the year under review;

(xix) 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, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

Looking at the nature of activities being carried on, at present, by the Company, and also considering the nature of matters referred to in various clauses of the Order, as amended issued by the central Government in terms of Section 227 (4A) of the Act, clauses (viii) & (xiii) of paragraph 4 of the aforesaid Order, are in our opinion, not applicable to the Company.

GIRISH M. PATHAK

Partner

Membership No. 102016

For and on behalf of

K.K.MANKESHWAR & CO.,

Chartered Accountants

FRN- 106009W

Mumbai, dated the 23rdMay, 2013


Mar 31, 2012

We have audited the attached Balance Sheet of Mukand Engineers Limited, as at 31St March, 2012 and also the annexed Statement of Profit & Loss and the Cash Flow statement of the Company 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.

1. We conducted our audit in accordance with the accounting standards generally accepted in India. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statements. 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 overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) order,2004 ('the Order') issued by the central Government in terms of Section 227 (4A) of the Companies Act, 1956, we annex hereto a Statement on the matters specified in paragraphs 4 & 5 of the said Order.

3. Further to our comments in the Annexure referred to in paragraph 2 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 the books of the Company;

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

(iv) In our opinion, the Statement of Profit & Loss and Balance Sheet together with the Notes thereon dealt with by this report, comply with the Mandatory accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 to the extent applicable;

(v) On the basis of written representations received from the Directors of the Company as on 31s' March, 2012 and taken on record by the Board of Directors of the Company, we report that no Director is disqualified as on 31st March, 2012 from being appointed as a director of the Company in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

(vi) Without qualifying our opinion, we draw your attention to Note No. 28.1 to the financial statements, relating to the recoverability of the overdue loans, aggregating f 103,400,000 (Previous Year f 119,675,000) and Interest Receivable thereon, aggregating Rs 49,548,194 (Previous Year Rs 56,589,934), at the end of the year, that are due from investment companies (related parties) whose net worth have eroded, and the Management's assessment on their recoverability due to the reason stated therein, which are susceptible to inherent uncertainties which, if not materialized could significantly impact the carrying values of the aforesaid loans & interest thereon.

(vii) In our opinion, and to the best of our information and according to the explanations given to us, the said financial statements, subject to our observation expressed in para 3(vi) above, and read together with the 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 principles generally accepted in India:

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

(b) in the case of the Statement of Profit & 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 of the Company for the year ended on that date.

ANNEXURE TO THE AUDITOR'S REPORT

(Referred to in our report of even date)

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

(b) As per the explanation given to us, the Fixed assets were physically verified by the Management in accordance with a regular programme covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets have been physically verified by the management during the year. As per the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the fixed assets disposed off during the year do not constitute a substantial part of fixed assets of the Company and such disposal has not affected the going concern status of the Company.

(ii) (a) The inventory excluding stocks with sub contractors third parties and Work- in-Progress has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable.

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

(c) On the basis of our examination of the inventory records, we are of the opinion that the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under section 301 of the Company's Act, 1956. Consequently, clauses

(iii) (a) to (iii) (g) of paragraph 4 of the Companies (Auditor's Report) Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items of purchase / services availed are of special nature for which suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and for the 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 explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

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

(a) The particulars of contracts or arrangements referred to in Section 301 that needed to be entered in the Register have been so entered.

(b) Where each of such transaction is in excess of Rupees Five Lacs in respect of any party, transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58 A and 58AA or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules 1975 with regards to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

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

(viii) (a) According to the information and explanations given to us and the 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, Sales Tax, Service Tax, Entry Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. The Company is in the process of reconciling Service Tax, Provident Fund, Works Contract Tax, Employees' State Insurance and Tax Deducted at Source balances relating to earlier years and the amounts due, if any, will be ascertained on completion of reconciliations. There were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.

(b) According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Entry Tax, Cess and other material statutory dues in arrears as on 31s' March,2012 for a period of more than six months from the date they became payable.

(c) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the disputed statutory dues in respect of Income Tax, Service Tax, Customs Duty, Excise Duty, Works Contract Tax, Entry Tax and Cess unpaid as at the last day of the financial year, are as under:

Nature Amount Period to Forum where of dues Rs which the the dispute amount is pending relates

Income 8,622,250 2000-2001 High Court Tax and of 2001 -2002 Bombay

Income 1,309,112 2000-2001 Income Tax Tax 7,146,336 2005-2006 Appellate Tribunal

Income 9,008,892 2002-2003 Income Tax Tax to Department 2008-2009 Authorities

Works 2,472,506 2001-2002 Sales Tax Contracts to Department Tax 2004-2005 Authorities

Entry Tax 1,009,008 1999-2000 High Court/ to Supreme 2003-2004 Court

(ix) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year;

(x) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holder;

(xi) In our opinion and according to information & explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

(xii) In our opinion and according to information & explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. All the investments are held by the Company, in its own name;

(xiii) In our opinion and according to information & explanations given to us and the representations made by the Management, the terms and conditions at which the guarantees given by the Company for loans taken from financial institutions and / or banks by others, are prima facie not prejudicial to the interests of the Company;

(xiv) In our opinion and according to information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xv) On the basis of review of utilization of funds on an overall basis, related information as made available to us and examination of the financial statements of the Company, we are of the opinion that prima facie short term funds have not been used for long term purposes during the year;

(xvi) According to the information and explanations given to us, the Company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act;

(xvii) According to information and explanations given to us, the Company has not issued any debentures during the year.

(xviii)The Company has not raised any monies by public issue during the year under review;

(xix) 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, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

Looking at the nature of activities being carried on, at present, by the Company, and also considering the nature of matters referred to in various clauses of the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) order, 2004 ('the Order') issued by the central Government in terms of Section 227 (4A) of the Companies Act, 1956, clauses (viii) & (xiii) of paragraph 4 of the aforesaid Order, are in our opinion, not applicable to the Company.

GIRISH M. PATHAK

Partner

Membership No.: 102016

For & on behalf of

K. K. MANKESHWAR & CO

Chartered Accountants

FRN 106009W

Mumbai dated the 23rd May, 2012.


Mar 31, 2011

We have audited the attached Balance Sheet of Mukand Engineers Limited, as at 31st March, 2011 and also the annexed Profit & Loss Account and the statement of Cash Flows of the Company for the year ended on that date. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

1. We conducted our audit in accordance with the accounting standards generally accepted in India. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) order,2004 (the Order) issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we annex hereto a Statement on the matters specified in paragraphs 4 & 5 of the said Order.

3. Further to our comments in the Annexure referred to in paragraph 2 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 the books of the Company;

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

(iv) In our opinion, the Profit & Loss Account and Balance Sheet together with the Notes thereon dealt with by this report, comply with the Mandatory accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 to the extent applicable;

(v) On the basis of written representations received from the Directors of the Company as on 31st March, 2011 and taken on record by the Board of Directors of the Company, we report that no Director is disqualified as on 31st March, 2011 from being appointed as a Director of the Company in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

(vi) Without qualifying our opinion, we draw your attention to Note No. B 7 in schedule 20 to the financial statements, relating to the recoverability of the overdue loans, aggregating Rs.119,675,000 (Previous Year Rs. 151,675,000) and Interest Receivable thereon, aggregating Rs. 56,589,934 (Previous Year Rs. 62,332,753), at the end of the year, that are due from investment companies (related parties) whose net worth have eroded, and the Managements assessment on their recoverability due to the reason stated therein, which are susceptible to inherent uncertainties which, if not materialized could significantly impact the carrying values of the aforesaid loans & interest thereon.

(vii) In our opinion, and to the best of our information and according to the explanations given to us, the said financial statements, subject to our observation expressed in para 3(vi) above, and read together with the 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 principles generally accepted in India:

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

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

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

ANNEXURE TO THE AUDITORS REPORT (Referred to in our report of even date)

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

(b) As per the explanation given to us, the Fixed assets were physically verified by the Management in accordance with a regular programme covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets have been physically verified by the management during the year. As per the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the fixed assets disposed off during the year do not constitute a substantial part of fixed assets of the Company and such disposal has not affected the going concern status of the Company.

ii) (a) The inventory excluding stocks with sub contractors/ third parties has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to information and explanations given to us, the procedures of physically verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c) On the basis of our examination of the inventory records, we are of the opinion that the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

iii) The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under 301 of the Company Act, 1956. Consequently, clauses (iii) (a) to (iii) (g) of paragraph 4 of the Companies (Auditors Report) Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items purchased/services availed are of special nature for which suitable alternative sources are not readily available for obtaining comparable quotations, there are adequate internal control procedures commensurate with

the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and for the 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 explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Company Act 1956, to the best of our knowledge and belief and according to information and explanations given to us:

(a) The particulars of contracts or arrangements referred to in Section 301 that needed to be entered in the Register have been so entered.

(b) Where each of such transaction is in excess of Rupees Five Lacs in respect of any party, transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has compiled with the directives issued by the Reserve Bank of India and the provisions of Sections 58 A and 58AA or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules 1975 with regards to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

(vii) In our opinion, the Company has an adequate internal audit system commensurate with the size and nature of its business however, the same needs to be further strengthened;

(viii) (a) According to the information and explanations given to us and the records of the Company examined by the 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, Service Tax, Income Tax, Sales Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. The Company is in the process of reconciling Service Tax, Provident Fund, Works Contract Tax, Employees State Insurance and Tax Deducted at Source balances relating to earlier years and the amounts due, if any, will be ascertained on completion of reconciliations. There were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.

(b) According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Cess and other material statutory dues in arrears as on 31st March, 2011 for a period of more than six months from the date they become payable

(c) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the disputed statutory dues in respect Income Tax, Service Tax, Customs Duty, Excise Duty, Works Contract Tax and Cess unpaid as at the last day of the financial year, are as under: Nature Amount Period to Forum where of dues Rs. which the the dispute amount is pending relates

Income 8,622,250 2000-01 High Court Tax and of 2001 -2002 Bombay

Income 2,429,636 2002-2003 Income Tax Tax Appellate Tribunal

Income 748,636 2005-06 Income Tax Tax Department Authorities

Works 2,349,419 2001-02 Sales Tax Contracts to Department Tax 2004-05 Authorities

Entry 1,009,008 1999-00 High Court/ Tax to Supreme 2003-04 Court

(ix) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year;

(x) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holder;

(xi) In our opinion and according to information & explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

(xii) In our opinion and according to information & explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. All the investments are held by the Company, in its own name;

(xiii) In our opinion and according to information & explanations given to us and the representations made by the Management, the terms and conditions at which the guarantees given by the Company for loans taken from financial institutions and / or banks by others, are prima facie not prejudicial to the interests of the Company;

(xiv)ln our opinion and according to information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

(xv) On the basis of review of utilization of funds on an overall basis, related information as made available to us and examination of the financial statements of the Company, we are of the opinion that prima facie short term funds have not been used for long term purposes during the year;

(xvi) According to the information and explanations given to us, the Company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act;

(xvii) According to information and explanations given to us, the Company has not issued any debentures during the year.

(xviii) The Company has not raised any monies by public issue during the year under review;

(xix) 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, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, not have we been informed of such case by the Management.

Looking at the nature of activities being carried on, at present, by the Company, and also considering the nature of matters referred to in various clauses of the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (the Order) issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956,clauses (viii) & (xiii) of paragraph 4 of the aforesaid Order, are in our opinion, not applicable to the Company.

GIRISH M. PATHAK Partner Membership No.: 102016

For & on behalf of K. K. MANKESHWAR & CO. Chartered Accountants FRN 106009W

Mumbai dated the May 26th, 2011


Mar 31, 2010

1. We have audited the attached Balance sheet of Mukand Engineers Limited, as at 31st March, 2010, the related Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the .Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together the "Order"), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of The Companies Act, 1956, of India (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act;

(e) On the basis of written representations received from the directors, as on 31st March, 2010 and taken on record by the Board of directors, none of the directors is disqualified as on 31st March, 2010 from being appointed as a Director in terms of clause (g) of sub- section (1) of Section 274 of the Act;

(f) Without qualifying our opinion, we draw your attention to Note No. 7 in Schedule 20 to the financial statements, relating to the recoverability of the overdue loans, aggregating Rs. 151,675,000 (Previous Year Rs. 179,450,000) and Interest Receivable thereon, aggregating Rs. 62,332,753 (Previous Year Rs. 62,332,753), at the end of the year, that are due from six investment companies (related parties) whose net worths have eroded, and the Managements assessment on their recoverability due to the reasons stated therein, which are susceptible to inherent uncertainties which, if not materialised could significantly impact the carrying values of the aforesaid loans and interest thereon.

(g) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

(ii) in the case of the Profit and Loss Account, 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.

ANNEXURE TO AUDITORS REPORT

Referred to in paragraph 3 of the Auditors Report of even date to the members of Mukand Engineers Limited on the financial statements for the year ended 31st March, 2010

1. (a) The Company is maintaining proper records showing

full particulars including quantitative details and situation of fixed assets.

(b) The fixed assets are physically verified by the management according to a phased programme designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the management during the year and no material discrepancies between the book records and the physical inventory has been noticed.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year.

2. (a) The inventory has been physically verified by the

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

(b) In our opinion, the procedures of physical 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. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

3. The Company has not granted / taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under Section 301 of the Act.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the 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 weaknesses in the aforesaid internal control system.

5. (a) In our opinion and according to the information and

explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lacs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58A and 58AA or any other provisions of the Act and the Companies (Acceptance of Deposit) Rules, 1975 with regard to deposits accepted from the public. According to the information and explanations given to us, no Order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

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

8. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, except for undisputed service tax dues, the Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth tax, customs duty, excise duty, cess and other material statutory dues as applicable with the appropriate authorities. There were no arrears of statutory dues outstanding as at 31 st March, 2010, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income-tax, sales- tax, wealth tax, service tax, customs duty, excise duty and cess as at 31st March, 2010 which have not been deposited on account of disputes are as follows:

Nature of Amount Period to Forum where Dues (Rs.) which the the dispute is amount pending relates

Income tax 19,882,170 2000-01 to Income tax 2002-2003 Appellate Tribunal

748,636 2005-06 Income Tax Departmental Authorities

Works 2,349,419 2001-02to Sales Tax Contracts 2004-05 Department Tax Authorities

Entry Tax 1.009,008 1999-00to High Court / 2003-04 Supreme Court

9. The Company has no accumulated losses as at 31st March 2010 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

10. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any bank. There were no dues to any financial institution or debenture holder.

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

12. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments. All the investments are held by the Company in its own name

13. in our opinion and according to the information and explanations given to us, and the representations made by the management, the terms and conditions of the guarantees given by the Company, for loans taken by others from banks or financial institutions, are not prejudicial to the interest of the Company.

14. In our opinion, and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

15. On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

16. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year.

17. On the basis of the records and documents examined by us, the Company has not issued any debentures during the year.

18. The Company has not raised any money by public issues during the year.

19. 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, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

20. The other clauses (iii)(b), (iii)(c), (iii)(d), (iii)(f), (iii)(g), (viii) and (xiii) of Paragraph 4 of the Order, are not applicable in the case the Company for the current year, since in our opinion, there is no matter which arises to be reported in the aforesaid Order.

For DALAL & SHAH Firm Registration Number: 102021W

Chartered Accountants

S. Venkatesh

Partner

Membership Number: 037942

Mumbai: 25th May, 2010



 
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