Auditor Report of Encode Packaging India Ltd.

Mar 31, 2015

Report on the Financial Statements

We have audited the accompanying financial statements of NOVA PUBLICATIONS INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at 31/03/2015, the Statement of Profit and Loss, for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's 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 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 of 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 there under.

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31/03/2015, and its Profit for the year ended on that date.

Report on Other Legal and Regulatory Requirements

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

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

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

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

(c) The Balance Sheet, the Statement of Profit and Loss, and 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 the written representations received from the directors as on 31/03/2015 taken on record by the Board of Directors, none of the directors is disqualified as 31/03/2015 from being appointed as a director in terms of Section 164 (2) of the Act.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements.

ii. 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 PARAGRAPH (1) OF AUDITORS REPORT OF EVEN DATE Annexure to the Independent Auditors' Report

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

(1) In Respect of Fixed Assets

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

(b) Fixed assets have been physically verified by the management at reasonable intervals; No material discrepancies were noticed on such verification.

(2) In Respect of Inventory

(a) Physical verification of inventory has been conducted at reasonable intervals by the management.

(b) Procedures for physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business. There is no inadequacies in such procedures that should be reported.

(c) Company is maintaining proper records of inventory. No material discrepancies were noticed on physical verification.

(3) No Loans and advances to parties covered under section 189

(4) Internal Control in reference to Purchase of Inventory and Fixed Assets and whether there is continue failure of Internal control

In our opinion and according to the information and explanations given to us there are adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of audit We have not observed continuing failure to correct major weaknesses in internal control system.

(5) Rules followed while accepting Deposits

No deposits within the meaning of Sections 73 to 76 or any other relevant provision of the Act and rules farmed thereunder have been accepted by the Company.

(6) Maintenance of cost records

The Company is not required to maintain cost records pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (l) of section 148 of the Companies Act.

(7) According to the information and explanations given to us in respect of statutory dues

(a) The company is regular in depositing with appropriate authorities undisputed statutory dues including Provident fund, Investor education protection fund, Employees' state insurance, Income tax, Sales tax, Wealth tax, Service tax, Custom duty, Excise duty, Cess and other material statutory dues applicable to it.

(b) N.A

(c) YES

(8) Company which has been registered for a period less than five years and accumulated losses are more than 50% of Net worth, Reporting of cash Losses

The company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(9) Default in Repayment of Loans taken from Bank or Financial Institutions

The company has not defaulted in repayment of dues to financial institution or bank.

(10) Terms for Loans and Advances from Banks or Financial Institutions prejudicial to the interest of the company

On the basis of records examined by us and information provided by the management, we are of the opinion that the company has not given guarantees for loans taken by other from banks or financial institutions.

(11) Application versus purpose for which Loan Granted

The company did not have any term loans outstanding during the year.

(12) Reporting of Fraud During the Year Nature and Amount

According to the information and explanation given to us, no fraud on or by the company has been noticed or reported during the year.

For CHANDRA KIRAN & CO.

Chartered Accountants

(Sd/-)

PARMINDER SINGH

PROP.

PLACE: Jalandhar

DATE: This 21st Day of May 2015

---

Mar 31, 2014

We have audited the accompanying financial statements of M/S NOVA PUBLICATIONS INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March , 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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

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 the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the 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 the Management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and the 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 the written representations received from the directors as on 31st March, 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2014 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

ANNEXURE REFERRED TO IN PARAGRAPH (1) OF AUDITORS REPORT OF

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

(b) All the fixed assets have been physically verified by the management during the year. As explained by the management there is a regular programme of verification which, in our opinion is reasonable having regard to the size of the company and nature of its assets. No material discrepancies were noticed by the management during the year.

(c) During the year, no substantial parts of the fixed assets have been disposed off by the company. According to information and explanations given to us, we are of the opinion that the sales of the any minor part of the assets have not affected the going concern status of the company.

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

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

(c) The discrepancies between the physical stocks and the book stocks which have been properly dealt with in the books of account were not material in relation to the size of the company operation.

(iii) (a) The company has not taken any loan secured or unsecured from the companies, firms or other parties as listed in the register maintained under Section 301 of the Companies Act, 1956.

(b) The rate of interest and other terms & conditions of loan given or taken by the company secured or unsecured, are not prima facie prejudicial to the interest of the company.

(c) Payment of the principal amount and interest are as per terms of loan taken from/ or granted no overdue amount is exceeding Rs. 1 Lakhs.

(d) Reasonable steps have been taken by the company for recovery/payment of the principal and interest exceeding Rs. 1 Lakhs.

(iv) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control.

(v) (a) According to information and explanation given to us, we are of the opinion that the transactions that need to be entered in to the register maintained u/s. 301 of the companies act, 1956 have been so entered.

(b) In our opinion, according to information and explanations given to us, the transactions made in the pursuance of contracts or arrangement entered in register maintained under Section 301 of the companies act 1956 and exceeding the value of Rs. 5,00,000/- or more in respect of any party during the year have been made at prices which are reasonable having regards to the prevailing market prices at the relevant time.

(vi) The company has not accepted any deposits from the public with in the meaning of section 58-A and 58AA of the company Act 1956 and the rules framed there under.

(vii) In our opinion, the company has Internal Audit system commensurate with the size and nature of its business.

(viii) Cost records as required to be maintained under section 209 (I) of the Companies Act 1956 are not applicable to the company.

(ix) (a) Thc company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund. Investor Education and Protection Fund, Employee''s State Insurance, Income Fax, Sales Tax, Wealth Tax. Custom Duty, excise duly, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no disputed amounts are payable in respect of Income-l ax, Wealth Tax. Custom Duty, Excise duty sales tax as on 31st March 2014.

(x) In our opinion, the accumulated losses/ cash losses of the company are not more than 50 % of its net worth the company has not incurred cash losses during the financial year covered by the audit and immediately preceding financial year.

(xi) In our opinion and according to the information and explanation given to us the company has not defaulted in repayment of dues to a financial institution or bank.

(xii) In our opinion, the company and as per the information given by the management company has not granted loans and advances on the basis of securities by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or nidhi/ mutual benefit fund/ society. Therefore, the provisions of clause 4 (xiii) of the companies (Auditor''s Report) order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures or other investments Therefore, the provisions of clause 4 (xiv) of the companies (Auditor''s Report) order, 2003 arc not applicable to the company.

(xv) The company has not given guarantee for loans taken by others from bank or financial institutions.

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

(xvii) According the information and explanations given to us and on overall examination of the balance sheet of the company we report that the no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets.

(xviii) According the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

(xix) According the information and explanations given to us, during the period covered by our audit report the company had not issued debentures.

(xx) According the information and explanations given to us, no money was raised by public issue during the period covered by our audit report.

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



For CHANDRA KIRAN & CO. Chartered Accountants

(Sd/-) PARMINDER SINGH PROP.

PLACE: Jalandhar DATE : This 21st Day of May 2014.

---

Mar 31, 2012

We have audited the attached Balance Sheet of NOVA PUBLICATIONS INDIA LTD. as at 31st March 2012 and also the Profit and Loss Account & Cash Flow Statement for the year ended on that date annexed thereto for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. These 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 amount 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.

As required by the manufacturing and other Companies (Auditor's 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 Annexure a statement on the matters specified in paragraph 4 and 5 of the said Order.

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

I. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose 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 dealt with by this report are in agreement with the books of account.

IV. In our Opinion, the Balance Sheet and Profit and Loss Account 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 representations received from the directors, as on 31st March 2012 and taken on record by the Board of directors, we report that none of the directors is disqualified as on 31st March 2012 from being appointed as a 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 give the information required by the Companies Act, 1956 in the manner so required and give true and fair view in conformity with the accounting principles generally accepted in India;

(a) in the case of the Balance Sheet of the State of affairs of the company as at 31st March 2012

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

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

ANNEXURE REFERRED TO IN PARAGRAPH (1) OF AUDITORS REPORT OF EVEN DATE

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

(b) All the fixed assets have been physically verified by the management during the year. As explained by the management there is a regular programme of verification which, in our opinion is reasonable having regard to the size of the company and nature of its assets. No material discrepancies were noticed by the management during the year.

(c) During the year, no substantial parts of the fixed assets have been disposed off by the company. According to information and explanations given to us, we are of the opinion that the sales of the any minor part of the assets have not affected the going concern status of the company.

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

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

(c) The discrepancies between the physical stocks and the book stocks which have been properly dealt with in the books of account were not material in relation to the size of the company operation.

(iii) (a) The company has not taken any loan secured or unsecured from the companies, firms or other parties as listed in the register maintained under Section 301 of the Companies Act, 1956.

(b) The rate of interest and other terms & conditions of loan given or taken by the company secured or unsecured, are not prima facie prejudicial to the interest of the company.

(c) Payment of the principal amount and interest are as per terms of loan taken from/ or granted no overdue amount is exceeding Rs. 1 Lakhs.

(d) Reasonable steps have been taken by the company for recovery/payment of the principal and interest exceeding Rs. 1 Lakhs.

(iv) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control.

(v) (a) According to information and explanation given to us, we are of the opinion that the transactions that need to be entered in to the register maintained u/s. 301 of the companies act, 1956 have been so entered.

(b) In our opinion, according to information and explanations given to us, the transactions made in the pursuance of contracts or arrangement entered in register maintained under Section 301 of the companies act 1956 and exceeding the value of Rs..5,00,000/- or more in respect of any party during the year have been made at prices which are reasonable having regards to the prevailing market prices at the relevant time.

(vi) The company has not accepted any deposits from the public with in the meaning of section 58-A and 58AA of the company Act 1956 and the rules framed there under.

(vii) In our opinion, the company has Internal Audit system commensurate with the size and nature of its business.

(viii) Cost records as required to be maintained under section 209 (I) of the Companies Act 1956 are not applicable to the company.

(ix) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, Investor Education and Protection Fund, Employee's State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no disputed amounts are payable in respect of Income-Tax, Wealth Tax, Custom Duty, Excise duty sales tax as on 31st March 2012.

(x) In our opinion, the accumulated losses/ cash losses of the company are not more than 50 % of its net worth the company has not incurred cash losses during the financial year covered by the audit and immediately preceding financial year.

(xi) In our opinion and according to the information and explanation given to us the company has not defaulted in repayment of dues to a financial institution or bank.

(xii) In our opinion, the company and as per the information given by the management company has not granted loans and advances on the basis of securities by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or nidhi/ mutual benefit fund/ society. Therefore, the provisions of clause 4 (xiii) of the companies (Auditor's Report) order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures or other investments Therefore, the provisions of clause 4 (xiv) of the companies (Auditor's Report) order, 2003 are not applicable to the company.

(xv) The company has not given guarantee for loans taken by others from bank or financial institutions.

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

(xvii) According the information and explanations given to us and on overall examination of the balance sheet of the company we report that the no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets.

(xviii) According the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

(xix) According the information and explanations given to us, during the period covered by our audit report the company had not issued debentures.

(xx) According the information and explanations given to us, no money was raised by public issue during the period covered by our audit report.

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

For CHANDRA KIRAN & CO. Chartered Accountants

(Sd/-)

PARMINDER SINGH PROP.

PLACE: Jalandhar

DATE: This 30th Day of June 2012.

---

Mar 31, 2010

We have audited the attached Balance Sheet of NOVA PUBLICATIONS INDIA LTD. as at 31st March 2010 and also the Profit and Loss Account & Cash Flow Statement for the year ended on that date annexed thereto for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. These 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 amount 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. As required by the manufacturing and other Companies (Auditor's 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 Annexure a statement on the matters specified in paragraph 4 and 5 of the said Order.

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

I. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose 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 dealt with by this report are in agreement with the books of account.

IV. In our Opinion, the Balance Sheet and Profit and Loss Account 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 representations received from the directors, as on 31st March 2010 and taken on record by the Board of directors, we report that 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 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 give the information required by the Companies Act, 1956 in the manner so required and give true and fair view in conformity with the accounting principles generally accepted in India;

(a) in the case of the Balance Sheet of the State of affairs of the company as at 31st March 2010 and

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

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

ANNEXURE REFERRED TO IN PARAGRAPH (1) OF AUDITORS REPORT OF EVEN DATE

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

(b) All the fixed assets have been physically verified by the management during the year. As explained by the management there is a regular Programme of verification which, in our opinion is reasonable having regard to the size of the company and nature of its assets. No material discrepancies were noticed by the management during the year.

(c) During the year, no substantial part of fixed assets has been disposed off by the company. According to information and explanations given to us, we are of the opinion that the sale of the assets have not affected the going concern status of the company.

(ii) (a) The stock of securities has been physically verified during the year by the management in our opinion, the frequency of verification is reasonable

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

(c) No discrepancies between the physical stock of securities and the book stock of securities have been found during the year under audit.

(iii) (a) As per the information furnished to us the company has neither granted loans, secured or unsecured from companies , firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(iv) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control.

(v) (a) According to information and explanation given to us, we are of the opinion that the transactions that need to be entered in to the register maintained u/s. 301 of the companies act, 1956 have been so entered.

(b) In our opinion, according to information and explanations given to us, no such transactions are made in pursuance of contracts or arrangement entered in register maintained under Section 301 of the companies act 1956 and of the value of Rs..5,00,000/- or more.

(vi) The company has not accepted any deposits from the public with in the meaning of section 58-A and 58 AA of the Companies Act 1956 and the rules framed there under.

(vii) In our opinion, the company has Internal Audit system commensurate with the size and nature of its business.

(viii) Cost records as required to be maintained under section 209 (I) of the Companies Act 1956 are not applicable to the company.

(ix) (a) The company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, Investor Education and Protection Fund, Employee's State Insurance, Income Tax, VAT, Wealth Tax, Custom Duty, excise duty, cess and other material statutory dues if applicable to it.

(b) According to the information and explanations given to us, no disputed amounts are payable in respect of Income-Tax, Wealth Tax, Custom Duty, Excise duty sales tax as on 31st March 2010.

(x) In our opinion, the accumulated losses of the company are not more than 50% of its net worth the company has incurred cash losses during the financial year covered by the audit and immediately preceding the financial year.

(xi) In our opinion and according to the information and explanation given to us the company has not defaulted in repayment of dues to a financial institution or bank.

(xii) In our opinion, the company and as per the information given by the management company has not granted loans and advances on the basis of securities by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or nidhi/ mutual benefit fund/ society. Therefore, the provisions of clause 4 (xiii) of the companies (Auditor's Report) order, 2003 are not applicable to the company.

(xiv) In our opinion, the company has maintained proper records of its transactions and contracts in respect of dealing or trading in shares, securities, debentures and other investments and timely entries have been made therein. Since the principal business of company consist of buying and selling of shares or securities, provisions of section 49 (1) are not applicable to the company by virtue of 2

(xv) In our opinion, no term loans have been availed by the company during the period under audit.

(xvi) According to the information and explanations given to us and on overall examination of the balance sheet of the company we report that the no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets.

(xvii) According to the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

(xviii) According to the information and explanations given to us, during the period covered by our audit report, the company had not issued debentures.

(xix) According to the information and explanations given to us, no money was raised by public issue during the period covered by our audit report.

(xx) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit

For CHANDRA KIRAN & CO. Chartered Accountants

(Sd/-) PARMINDER SINGH PROP.

PLACE : Jalandhar DATE : This 30th Day of June 2010