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Auditor Report of Mukesh Babu Financial Services Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Mukesh Babu Financial Services Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, and the Statement of Profit and Loss, 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 these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these 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 disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 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:

(i) in case of the Balance Sheet, of the state of affairs of the Company as at March 31,2015.

(ii) in case of Statement of Profit and Loss, of Profit of the Company for the year ended on that date.

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

Report on Other Legal and Regulatory Requirements As required by Section 143 (3) of the Act, we report that:

(a) we have sought and obtained all the information and explanation, 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 and Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) in our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

(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. We have been informed by the Company that the pending litigations against the Company would not impact its financial position.

ii. In our view, the Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;

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

ANNEXURE REFERRED TO IN REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS OF

OUR REPORT OF EVEN DATE

IN CASE OF Mukesh Babu Financial Services Limited

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

(b) The management at reasonable intervals has verified the fixed assets. We have been informed that, no material discrepancies on such verification have been noticed.

(ii) (a) As per the records maintained, the management has conducted verification of inventory at reasonable intervals.

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

(c) In our view, the Company has maintained proper records of inventory. No material discrepancies have been noticed on physical verification of stocks as compared to the book records.

(iii) (a) The Company has granted unsecured loan to One Company covered in the register maintained under section 301 of the Act involving 87,717,229 on a maximum basis and Rs. 44,837,827 on at the year end.

(b) The rate of interest and other terms and conditions of these loans are prima facie not prejudicial interest of the Company.

(c) In respect of the loans given, the parties are repaying the principal amounts and interest as stipulated;

(iv) In our view, there is an adequate internal control system commensurate with the size of the Company and nature of its business, for the purchase of inventory and fixed assets, and for sale of goods and services. In our view, there has been no continuing failure to correct major weakness in internal control systems of the Company.

(v) The Company has not accepted any deposits from public within the meaning of the provisions of section 73 or any other provisions of the Companies Act, 2013 and the rules made there under. We have been informed by the management that there has been no order 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 with respect to compliance of the provisions of section 73 or any other provisions of the Companies Act 2013.

(vi) We have been informed by the management that, the Central Government has not prescribed the method of maintenance of cost records u/s. 148 (1) of the Companies Act, 2013 to the industry to which the Company pertains.

(vii) (a) We have been informed by the management that, the Company is generally regular in depositing all undisputed statutory dues with the appropriate authorities and there have been no material arrears of outstanding dues as at the last day of this financial year for more than six months from the date they became payable .

(b) In our opinion and according to the information and explanation given to us, there are no dues of Income tax, Sales tax, Wealth Tax, and Service tax, Custom Duty, Excise Duty or Cess, as applicable to it which have not been deposited on account of any dispute.

(c) In our opinion. the company is not required to transfer any amount to investor education and protection fund in accordance with the relevant provision of the companies act, 1956(1 of 1956) and rules made thereunder.

(viii) There are no accumulated losses at the end of the financial year. Also, the Company has not reported any cash losses during the year or immediately preceding financial year.

(ix) As informed to us by the management, the Company has not defaulted in repayment of any dues to financial institution or banks; whereas there are no debenture holders

(x) The management has informed us that, the Company has not given any guarantee for loans taken by others from any bank or financial institutions.

(xi) As per the explanation given by the management, the term loans were applied for the purposes for which they were obtained.

(xii) As informed by the management, there has not been noticed or reported any fraud on or by the Company during the year.

AS PER OUR REPORT OF EVEN DATE FOR SHAH, SHAH & SHAH CHARTERED ACCOUNTANTS

(Mehul Shah)

PARTNER

FRN: 116457W

M. No.: 049361

Mumbai: Date : 29/05/2015


Mar 31, 2014

We have audited the accompanying financial statements of Mukesh Babu Financial Services Limited as at 31st March 2014, which comprise of the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss, and Cash Flow Statement of the Company for the year ended on that date annexed thereto, 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 and financial performance in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and 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 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 case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2014;

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

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

Report on Other Legal and Regulatory Requirements

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

As required by section 227(3) of the Act, we report that:

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

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

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

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

(e) on the basis of written representations received from the Directors, as on the date of balance sheet, and taken on record by the board of directors, we report that none of the directors is disqualified as on the said date 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;

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

b The management at reasonable intervals has verified the fixed assets. We have been informed that, no material discrepancies on such verification have been noticed.

c The Company has not disposed substantial portion of its fixed assets during the year; accordingly the going concern status of the Company is not affected.

II a As per the records maintained, the management has conducted physical verification of inventory at reasonable intervals.

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

c In our view, the Company has maintained proper records of inventory. No material discrepancies have been noticed on physical verification of stocks as compared to the book records

III a The Company has granted unsecured loan to One Company covered in the register maintained under section 301 of the Act involving Rs. 99,049,430 on a maximum basis and Rs.87,717,229 on at the year end.

b The rate of interest and other terms and conditions of these loans are prima facie not prejudicial interest of the Company.

c In respect of the loans given, the parties are repaying the principal amounts and interest as stipulated;

d In respect of the aforesaid loans, there is no overdue amount more than Rupees One lac.

e The Company has not taken loans from companies covered in the register maintained under Section 301 of the Act. Hence the clause as to repayment of principal and interest is not applicable.

f Since no loans are taken from the aforesaid parties, the sub-clause dealing with rate of interest and other terms and conditions of loans given by the Company are not applicable.

g Since no loans are taken as aforesaid, the sub-clause dealing with payment of the principal amount and interest on regular basis is not applicable.

IV In our view, there is an adequate internal control system commensurate with size of the Company and nature of its business, for the purchase of inventory and fixed assets, and for sale of goods and services. In our view, there has been no continuing failure to correct major weaknesses in internal control systems of the Company.

V a The contracts or arrangements exceeding the value ofRs.500,000 referred to in Section 301 of the Act to be entered in the register required to be maintained under that Section have been so entered; and

b In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into the register in pursuance of Sections 301 of the Act and exceeding the value of Rupees Five Lakhs in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

VI The Company has not accepted any deposits from public within the meaning of the provisions of section 58A and section 58AA or any other provisions of the Companies Act, 1956 and the rules made there under and as mentioned in directives issued by the reserve bank of India. We have been informed by the management that there has been no order 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 with respect to compliance of the provisions of section 58A or 58AA or any other provisions of the Companies Act 1956.

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

VIII We have been informed by the management that, the Central Government has not prescribed the method of maintenance of cost records u/s. 209 (1) (d) of the Companies Act, 1956 to the industry to which the Company pertains.

IX a

We have been informed by the management that, the Company is generally regular in depositing all undisputed statutory dues with the appropriate authorities and there have been no arrears of outstanding dues as at the last day of this financial year for more than six months from the date they became payable.

b We have been informed by the management that, there has been no disputes pending with any forums as regards any of the statutory dues including sales-tax, income tax, customs duty, wealth tax, service tax, excise duty or cess.

X There are no accumulated losses at the end of the financial year; and the Company has not reported any cash losses during the year.

XI According to the records of the Company as examined by us and information and explanation given to us, bank overdraft balance is subject to confirmation and reconciliation as stated in Note no. 3 of Other Notes to Accounts.

XII We have been informed that, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities; accordingly, there is no necessity as to maintaining documents and records in this respect.

XIII The provisions of any special statute in respect of chit fund, nidhi, mutual benefit funds or societies are not applicable to the Company.

XIV The Company has maintained proper records of transactions and contracts in respect of trading in shares, debentures, and other securities and timely entries have been made therein. The investments are held by the Company in its own names, except allowable under section 49 of the Companies Act, 1956.

XV The management has informed us that, the Company has not given any guarantee for loans taken by others from any bank or financial institutions.

XVI As per the explanation given by the management, the Company has applied the term loans for the purpose for which the loans were obtained.

XVII As explained to us by the management, there were no funds that were raised on a short-term basis, which have been applied for long-term investment.

XVIII The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act 1956.

XIX The Company has not issued any debentures; hence no security or charges have been created in respect of the same.

XX The Company has not made any public issue during the year of shares; hence disclosure requirement as to end utilization of public issue money is not required.

XXI As informed by the management, there has not been noticed or reported any fraud on or by the Company during the year.

FOR SHAH, SHAH & SHAH CHARTERED ACCOUNTANTS

Sd/- (Mehul Shah) PARTNER

Place :Mumbai Date : 30/05/2014 M. No. 049361 FRN: 116457W


Mar 31, 2013

We have audited the accompanying financial statements of Mukesh Babu Financial Services Limited as at 31st March 2013, which comprise of the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss, and Cash Flow Statement of the Company for the year ended on that date annexed thereto, 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 and financial performance in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956. 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 case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2013;

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

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

Report on Other Legal and Regulatory Requirements

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

As required by section 227(3) of the Act, we report that:

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

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

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

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

(e) on the basis of written representations received from the Directors, as on the date of balance sheet, and taken on record by the board of directors, we report that none of the directors is disqualified as on the said date 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;

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

b The management at reasonable intervals has verified the fixed assets. We have been informed that, no material discrepancies on such verification have been noticed.

c The Company has not disposed substantial portion of its fixed assets during the year; accordingly the going concern status of the Company is not affected.

As per the records maintained, the management has conducted physical verification of inventory at reasonable intervals.

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

c In our view, the Company has maintained proper records of inventory. No material discrepancies have been noticed on physical verification of stocks as compared to the book records

W a The Company has granted unsecured loan to One Company covered in the register maintained under section 301 of the Act involving Rs. 144,442,472 on a maximum basis and Rs. 99,049,430 on at the year end.

b The rate of interest and other terms and conditions of these loans are prima facie not prejudicial interest of the Company.

c In respect of the loans given, the parties are repaying the principal amounts as stipulated; whereas there is no stipulation as to payment of interest.

d In respect of the aforesaid loans, there is no overdue amount more than Rupees One lac.

e The Company has not taken loans from companies covered in the register maintained under Section 301 of the Act. Hence the clause as to repayment of principal and interest is not applicable.

f Since no loans are taken from the aforesaid parties, the sub-clause dealing with rate of interest and other terms and conditions of loans given by the Company are not applicable.

g Since no loans are taken as aforesaid, the sub-clause dealing with payment of the principal amount and interest on regular basis is not applicable.

IV In our view, there is an adequate internal control system commensurate with size of the Company and nature of its business, for the purchase of inventory and fixed assets, and for sale of goods and services. In our view, there has been no continuing failure to correct major weaknesses in internal control systems of the Company.

V a The contracts or arrangements exceeding the value ofRs. 500,000 referred to in Section 301 of the Act to be entered in the register required to be maintained under that Section have been so entered; and

b In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into the register in pursuance of Sections 301 of the Act and exceeding the value of Rupees Five Lakhs in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

VI The Company has not accepted any deposits from public within the meaning of the provisions of section 58A and section 58AA or any other provisions of the Companies Act, 1956 and the rules made there under and as mentioned in directives issued by the reserve bank of India. We have been informed by the management that there has been no order 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 with respect to compliance of the provisions of section 58A or 58AA or any other provisions of the Companies Act 1956.

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

VIII We have been informed by the management that, the Central Government has not prescribed the method of maintenance of cost records u/s. 209 (1) (d) of the Companies Act, 1956 to the industry to which the Company pertains.

IX a

We have been informed by the management that, the Company is generally regular in depositing all undisputed statutory dues with the appropriate authorities and there have been no arrears of outstanding dues as at the last day of this financial year for more than six months from the date they became payable.

b We have been informed by the management that, there has been no disputes pending with any forums as regards any of the statutory dues including sales-tax, income tax, customs duty, wealth tax, service tax, excise duty or cess.

X There are no accumulated losses at the end of the financial year; and the Company has not reported any cash losses during the year.

XI According to the records of the Company as examined by us and information and explanation given to us, bank overdraft balance is subject to confirmation and reconciliation as stated in Note no. 3 of Other Notes to Accounts.

XI We have been informed that, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities; accordingly, there is no necessity as to maintaining documents and records in this respect.

XIII The provisions of any special statute in respect of chit fund, nidhi, mutual benefit funds or societies are not applicable to the Company.

XIV

The Company has maintained proper records of transactions and contracts in respect of trading in shares, debentures, and other securities and timely entries have been made therein. The investments are held by the Company in its own names, except allowable under section 49 of the Companies Act, 1956.

XV The management has informed us that, the Company has not given any guarantee for loans taken by others from any bank or financial institutions.

XVI As per the explanation given by the management, the Company has applied the term loans for the purpose for which the loans were obtained.

XVII As explained to us by the management, there were no funds that were raised on a short-term basis, which have been applied for long-term investment.

XVI The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act 1956.

XIX The Company has not issued any debentures; hence no security or charges have been created in respect of the same.

XX The Company has not made any public issue during the year of shares; hence disclosure requirement as to end utilization of public issue money is not required.

XXI As informed by the management, there has not been noticed or reported any fraud on or by the Company during the year.

FOR SHAH, SHAH & SHAH

CHARTERED ACCOUNTANTS

Sd/-

(Mehul Shah)

PARTNER



Mumbai Date : 28/05/2013

M. No. 049361

FRN: 116457W


Mar 31, 2012

We have audited the attached Balance Sheet of Mukesh Babu Financial Services Limited as at 31st March 2012 and Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our Responsibility is to express an opinion on these financial statements based on our audit.

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 the 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 of our opinion.

As required by the Companies (Auditors' Report) Order, 2003 issued by the Central Government of India in terms of sub- section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and S of the said Order, to the extent applicable to the Company in terms of sub-section (4A) of section 227 of the Companies Act 1956.

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

(a) we have obtained all the information and explanation, 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 and Profit and Loss Account and cash flow statement with by this report are in agreement with the books of account;

(d) in our opinion, the Balance sheet and statement of profit and loss dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act 1956;

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

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

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

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

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

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE

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

b The management at reasonable intervals has verified the fixed assets. We have been informed that, no material discrepancies on such verification have been noticed.

c (c) The Company has not disposed substantial portion of its fixed assets during the year; accordingly the going concern status of the Company is not affected.

II a As per the records maintained, the management has conducted physical verification of inventory at reasonable intervals.

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

c In our view, the Company has maintained proper records of inventory. No material discrepancies have been noticed on physical verification of stocks as compared to the book records

III a The Company has granted unsecured loans to One Company covered in the register maintained under section 301 of the Act involving Rs. 119946757 on a maximum basis and Rs. 96,034,101 on at the year end, which is interest free.

b Other terms and conditions of these loans are prima facie not prejudicial interest of the Company.

c In respect of the loans given, the parties are repaying the principal amounts as stipulated; whereas there is no stipulation as to payment of interest

d In respect of the aforesaid loans, there is no overdue amount more than Rupees One lac.

e The Company has not taken loans from companies covered in the register maintained under Section 301 of the Act. Hence the clause as to repayment of principal and interest is not applicable.

f Since no loans are taken from the aforesaid parties, the sub-clause dealing with rate of interest and other terms and conditions of loans given by the Company are not applicable, g Since no loans are taken as aforesaid, the sub-clause dealing with payment of the principal amount and interest on regular basis is not applicable.

IV in our view, there is an adequate internal control system commensurate with size of the Company and nature of its business, for the purchase of inventory and fixed assets, and for sale of goods and services. In our view, there has been no continuing failure to correct major weaknesses in internal control systems of the Company.

V a The contracts or arrangements exceeding the value of Rs. 500,000 referred to in Section 301 of the Act to be entered in the register required to be maintained under that Section have been so entered; and

b In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into the register in pursuance of Sections 301 of the Act and exceeding the value of Rupees Five lakhs in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time, me Company has not accepted any deposits from public within the meaning or the provisions of section b8A and section 58AA or any other provisions of the Companies Act, 1956 and the rules made there under and as mentioned in directives issued by the reserve bank of India. We have been informed by the management that there has been no order 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 with respect to compliance of the provisions of section 58A or 58AA or any other provisions of the Companies Act 1956.

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

VIII We have been informed by the management that, the Central Government has not prescribed the method of maintenance of cost records u/s. 209 (1) (d) of the Companies Act, 1956 to the industry to which the Company pertains.

IX a We have been informed by the management that, the Company is generally regular in depositing all undisputed statutory dues with the appropriate authorities and there have been no arrears of outstanding dues as at the last day of this financial year for more than six months from the date they became payable.

b We have been informed by the management that, there has been no disputes pending with any forums as regards any of the statutory dues including sales-tax, income tax, customs duty, wealth tax, service tax, excise duty or cess.

X There are no accumulated losses at the end of the financial year. Also, the Company has not reported any cash losses during the year.

XI According to the records of the Company as examined by us and information and explanation given to us, bank overdraft balance is subject to confirmation and reconciliation as stated in Note no. 3 of Other Notes to Accounts.

XII We have been informed that, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities; accordingly, there is no necessity as to maintaining documents and records in this respect.

XIII The provisions of any special statute in respect of chit fund, nidhi, mutual benefit funds or societies are not applicable to the Company.

XIV The Company has maintained proper records of transactions and contracts in respect of trading in shares, debentures, and other securities and timely entries have been made therein. The investments are held by the Company in its own names, except allowable under section 49 of the Companies Act, 1956.

XV The management has informed us that, the Company has not given any guarantee for loans taken by others from any bank or financial institutions.

XVI As per the explanation given by the management, the Company has applied the term loans for the purpose for which the loans were obtained.

XVII As explained to us by the management, there were no funds that were raised on a short-term basis, which have been applied for long-term investment. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act 1956.

XIX The Company has not issued any debentures; hence no security or charges have been created in respect of the same.

XX The Company has not made any public issue during the year of shares; hence disclosure requirement as to end utilization of public issue money is not required.

XXI As informed by the management, there has not been noticed or reported any fraud on or by the Company during the year.

FOR SHAH, SHAH & SHAH

CHARTERED ACCOUNTANTS

Sd/-

(Mehul Shah)

PARTNER M. No. 049361

FRN:116457W

Place: Mumbai

Date: 13/08/2012


Mar 31, 2010

We have audited the attached Balance Sheet of Mukesh Babu Financial Services Limited as at 31st March 2010 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the 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 of our opinion.

As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order, to the extent applicable to the company.

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

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

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

(iii) the Balance Sheet and Profit and Loss Account and cash flow statement with by this report are in agreement with the books of account;

(iv) in our opinion, the Balance Sheet and 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 Companies Act, 1956;

(v) on the basis of written representation received from the directors, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2010 from being appointed as director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

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

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

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

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

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE

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

(b) The management at reasonable intervals has verified the fixed assets. We have been informed that, no material discrepancies on such verification have been noticed.

(c) The Company has not disposed substantial portion of its fixed assets during the year; accordingly the going concern status of the Company is not affected.

(ii) (a) As per the records maintained, the management has conducted physical

verification of inventory at reasonable intervals.

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

(c) In our view, the Company has maintained proper records of inventory. No material discrepancies have been noticed on physical verification of stocks as compared to the book records.

(iii) (a) The company has granted unsecured loans to Two companies covered in the register maintained under section 301 of the Act involving RS. 125.79million, which are interest free.

(b) Other terms and conditions of these loans are prima facie not prejudicial interest of the Company.

(c) In respect of the loans given, the parties are repaying the principal amounts as stipulated; whereas there is no stipulation as to payment of interest.

(d) In respect of the aforesaid loans, there is no overdue amount more than Rupees One lac.

(e) The Company has not taken loans from companies covered in the register maintained under Section 301 of the Act. Hence the clause as to repayment of principal and interest is not applicable.

(f) Since no loans are taken from the aforesaid parties, the sub-clause dealing with rate of interest and other terms and conditions of loans given by the company are not applicable.

(g) Since no loans are taken as aforesaid, the sub-clause dealing with payment of the principal amount and interest on regular basis is not applicable.

(iv) In our view, there is an adequate internal control system commensurate with the size of the Company and nature of its business, for the purchase ofinventory and fixed assets, and for sale of goods and services. In our view, there has been no continuing failure to correct major weaknesses in internal control systems of the Company.

(v) (a) The contracts or arrangements exceeding the value of Rs. 500,000 referred to in Section 301 of the Act to be entered in the register required to be maintained under that Section have been so entered; and

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into the register in pursuance of Sections 301 of the Act and exceeding the value of Rupees Five Lakhs in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from public within the meaning of the provisions of section 58A and section 58AA or any other provisions of the Companies Act, 1956 and the rules made there under and as mentioned in directives issued by the reserve bank of India. We have been informed by the management that there has been no order 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 with respect to compliance of the provisions of section 58A or 58AA or any other provisions of the Companies Act 1956.

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

(viii) We have been informed by the management that, the Central Government has not prescribed the method of maintenance of cost records u/s. 209 (1) (d) of the Companies Act, 1956 to the industry to which the Company pertains.

(ix) (a) We have been informed by the management that, the Company is generally regular in depositing all undisputed statutory dues with the appropriate authorities and there have been no arrears of outstanding dues as at the last day of this financial year for more than six months from the date they became payable.

(b) We have been informed by the management that, there has been no disputes pending with any forums as regards any of the statutory dues including sales-tax, income tax, customs duty, wealth tax, service tax, excise duty or cess.

(x) There are no accumulated losses at the end of the financial year. Also, the company has not reported any cash losses during the year, but had reported cash losses in immediately preceding financial year.

(xi) According to the records of the company as examined by us and information and explanation given to us, bank overdraft balance is subject to confirmation and reconciliation as stated in Note no. 6 of Notes to Accounts.

(xii) We have been informed that, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities; accordingly, there is no necessity as to maintaining documents and records in this respect.

(xiii) The provisions of any special statute in respect of chit fund, nidhi, mutual benefit funds or societies are not applicable to the Company.

(xiv) The company has maintained proper records of transactions and contracts in respect of trading in shares, debentures, and other securities and timely entries have been made therein. The investments are held by the company in its own names, except allowable under section 49 of the Companies Act, 1956.

(xv) The management has informed us that, the Company has not given any guarantee for loans taken by others from any bank or financial institutions.

(xvi) As per the explanation given by the management, the Company has applied the term loans for the purpose for which the loans were obtained.

(xvii) As explained to us by the management, there were no funds that were raised on a short-term basis, which have been applied for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act 1956.

(xix) The Company has not issued any debentures; hence no security or charges have been created in respect of the same.

(xx) The Company has not made any public issue during the year of shares; hence disclosure requirement as to end utilization of public issue money is not required.

(xxi) As informed by the management, there has not been noticed or reported any fraud on or by the Company during the year.

For SHAH, SHAH & SHAH

Chartered Accountants

Sd/-

(MEHUL C. SHAH)

Partner

M. No. 49361

FRN:116457W

Mumbai: August 27, 2010





 
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