Auditor Report of Parab Infra Ltd.

Mar 31, 2013

1. We have audited the attached balance sheet of M/S PACHELI ENTERPRISES LIMITED, as at March 31, 2013, and also the profit and loss account 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.

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 (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 the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

iii. The balance sheet and 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 March 31, 2013 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2013 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 affairs of the Company as at March 31,2013; and

b. In the case of the profit and loss account, of the profit for the year ended on that date.

Referred to in paragraph 3 of our report of even date

(i) The Company has no fixed asset, hence the said clause is not applicable.

(ii) The Company has no inventory, hence the said clause is not applicable.

(iii) (a) The Company during the period has granted Interest loans to parties listed in the register maintained under section 301 of the Companies Act, 1956.

The year end balance of loans granted to such parties was Rs.224 lakhs

(b) In the Opinion of the Management, the interest rate fit other terms and conditions of such loan are not, is prima facie, prejudicial to the interest of the Company.

(c) There is no Stipulation as to the Period of repayment.

(d) Thus, We are unable to Comment on regularity of repayment & overdue amount as there is no stipulation for the same.

(e) The Company has not taken loans from parties listed in the register maintained under section 301 of the Companies Act, 1956.

(f) In the opinion of management, interest rate and the other terms fit Condition on which loans have been taken from parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company.

(g) As there is no stipulation for repayment of loan, we are unable to comment on regularity on repayment.

(iv) 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. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the company.

(v) (a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act.

(vi) In our opinion and according to information and explanations given to us, the Company has not accepted deposits from the Director and public within the meaning of section 58A of the Companies Act, 1956 and the rules framed there under are not applicable.

(vii) In our opinion, the company has an internal audit system according to its size and nature of its business.

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

(ix) (a) According to information and explanation given to us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including income-tax, service tax and other material statutory dues applicable to it which are outstanding for more than Six months from the date they become payable as of 31st March 2013.

(b) According to the records of the Company, there was no disputed statutory dues that have not been deposited on account of the matters pending before appropriates authorities.

(x) (a) The company has accumulated losses as at March 31, 2013 amounting to Rs.37,85,491/-. The Company has not incurred cash losses during the financial year & immediately preceding financial year.

(xi) According to the information and explanations given to us, the Company has not defaulted in any repayment of dues to any financial Institution or bank, as applicable, as at the Balance Sheet date.

(xii) As explained 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 and therefore Paragraph (xii) of the said Order relating to maintenance of documents and records is not applicable.

(xiii) The Company is not a Chit Fund / Nidhi / Mutual Benefit Fund/Societies. Therefore, the provisions of clause 4(xiii) are not applicable to the company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in securities.

(xv) According to the information and explanations given to us, the Company has not given guarantees Loan taken by others from bank or financial institutions and thus clause 4(xv) is not applicable.

(xvi) According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained by the company.

(xvii) According to the information and explanations given to us, the Company has not raised any funds, short- term or long-term, during the period and therefore Clause 4(xvii) of the said Order relating to usage of such funds is not applicable.

(xviii) According to the information and explanations given to us, during the year 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) According to the information and explanations given to us, during the year covered by our audit report, the Company has not issued any debentures.

(xx) According to the information and explanations given to us, the Company has not made any public issue during the period and accordingly Paragraph 4(xx) of the said Order relating to end use of money raised is not applicable.

(xxi) 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 Gowadia & Co.

(Chartered Accountant)

sd/-

Place : Mumbai Vinodkumar Gowadia

Date : 30th May, 2013 Proprietor

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Mar 31, 2012

1. We have audited the attached balance sheet of M/S PACHELI ENTERPRISES LIMITED, as at March 31, 2012, and also the profit and loss account 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.

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 (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 the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

iii. The balance sheet and 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 March 31, 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 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 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 affairs of the Company as at March 31, 2012; and

b. In the case of the profit and loss account, of the profit for the year ended on that date.

Annexure to the auditor,s report of

M/S PACHELI ENTERPRISES LIMITED

(FORMERLY KNOWN AS MANDSAUR FERRO ALLOYS LIMITED).

Referred to in paragraph 3 of our report of even date

4(i) The Company has no fixed asset, hence the said clause is not applicable.

4(ii) The Company has no inventory, hence the said clause is not applicable.

4(iii)(a) The Company during the period has granted Interest loans to parties listed in the register maintained under section 301 of the Companies Act, 1956. The year end balance of loans granted to such parties was `. 458 lakhs

(b) In the Opinion of the Management, the interest rate & other terms and conditions of such loan are not, is prima facie, prejudicial to the interest of the Company.

(c) There is no Stipulation as to the Period of repayment.

(d)Thus, We are unable to Comment on regularity of repayment & overdue amount as there is no stipulation for the same.

(e) The Company had taken loans from parties listed in the register maintained under section 301 of the Companies Act, 1956. The year end balance of loans taken from such parties was `.13.03Lakhs

(f) In the opinion of management, interest rate and the other terms & Condition on which loans have been taken from parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company.

(g) As there is no stipulation for repayment of loan, we are unable to comment on regularity on repayment.

4(iv) 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. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the company.

4(v)(a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act.

4(vi) In our opinion and according to information and explanations given to us, the Company has not accepted deposits from the Director and public within the meaning of section 58A of the Companies Act, 1956 and the rules framed there under are not applicable.

4(vii) In our opinion, the company has an internal audit system according to its size and nature of its business.

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

4(ix)(a) According to information and explanation given to us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including income-tax, service tax and other material statutory dues applicable to it which are outstanding for more than Six months from the date they become payable as of 31st March 2012.

(b) According to the records of the Company, there was no disputed statutory dues that have not been deposited on account of the matters pending before appropriates authorities.

4(x)(a) The company has accumulated losses as at March 31, 2012 amounting to 4,37,70,130/-. The Company has not incurred cash losses during the financial year & immediately preceding financial year

4(xi) According to the information and explanations given to us, the Company has not defaulted in any repayment of dues to any financial Institution or bank, as applicable, as at the Balance Sheet date.

4(xii) As explained 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 and therefore Paragraph 4(xii) of the said Order relating to maintenance of documents and records is not applicable.

4(xiii) The Company is not a Chit Fund / Nidhi / Mutual Benefit Fund/Societies. Therefore, the provisions of clause 4(xiii) are not applicable to the company.

4(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in securities.

4(xv) According to the information and explanations given to us, the Company has not given guarantees Loan taken by others from bank or financial institutions and thus clause 4(xv) is not applicable.

4(xvi) According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained by the company.

4(xvii) According to the information and explanations given to us, the Company has not raised any funds, short-term or long-term, during the period and therefore Clause 4(xvii) of the said Order relating to usage of such funds is not applicable.

4(xviii) According to the information and explanations given to us, during the year 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.

4(xix) According to the information and explanations given to us, during the year covered by our audit report, the Company has not issued any debentures.

4(xx) According to the information and explanations given to us, the Company has not made any public issue during the period and accordingly Paragraph 4(xx) of the said Order relating to end use of money raised is not applicable.

4(xxi) 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 SHYAM C. AGRAWAL & CO. Chartered Accountants

Sd/-

PLACE : MUMBAI S.C. AGRAWAL

DATED : 05/09/2012 (Proprietor)

---

Mar 31, 2011

1. We have audited the attached balance sheet of PACHELI ENTERPRISE LIMITED as at March 31, 2011, and also the Profit and Loss Account 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.

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 (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 the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

iii. The Balance Sheet and 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 March 31, 2011 arid taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

5. In our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 affairs of the Company as at March 31, 2011; and

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

Annexure to the auditor's report of

PACHELI ENTERPRISE LIMITED

(Formally Known As Mandsaur Ferro Alloys Limited)

Referred to in paragraph 3 of our report of even date

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

(b) As informed and represented to us, fixed assets have been physically verified by the management during the period and no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, the Company has not disposed off a substantial part of fixed assets during the period thereby affecting the going concern.

4(ii) The Company is a Service Company, primarily rendering consultancy Services. Accordingly, it does not hold Inventories. Hence, Paragraph 4(ii) of the Order, is not applicable.

4(iii)(a) The Company during the period has not taken loans unsecured from companies, firms, or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(b) The Company has not gave an unsecured loan to a Company (not covered within the scope of Section 301 of the Companies Act, 1956) by way of Inter Corporate Deposit, the rate of interest and other terms and conditions of which are not prima facie, prejudicial to the interest of the Company.

(c) The loans granted are re-payable on demand. As informed and explained, the Company has not demanded repayment of any such loan during the year, thus, there has been no default on the part of the parties to whom money has been lent. The payment of Interest is also not regular.

(d) As stated above, no repayment schedule has been specified and thus there are no overdue amounts in excess of Rs. One Lakh.

(e) The Company has not taken any loans, secured or unsecured, from parties covered in the register maintained under section 301 of the Act. Accordingly, the clause (iii)(f) and (iii)(g) of paragraph 4 of the Order are not applicable to the company for the year.

4(iv) 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 with regard to purchase of fixed assets. During the year, there was no Sale of Services. Provisions in respect of adequate controls referred in clause 4(iv) of the order relating to purchase of Inventories and sale of goods as company is service oriented company. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the company.

4(v)(a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act and exceeding the value of Five lakh rupees 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.

4(vi) In our opinion and according to information and explanations given to us, Company has not accepted deposits from the Director and public within . meaning of section 58A of the Companies Act, 1956 and the rules framed there under are not applicable.

4(vii) There is no internal audit system. However, the Company has adequate internal control procedure involving internal checking of its financial record.

4(viii) The Central Government has not prescribed maintenance of cost records under section 209(l)(d) of the Companies Act, 1956 for any of the activities of the Company.

4(ix)(a) According to information and explanation given to us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including income-tax, service tax and other material statutory dues applicable to it which are outstanding for more than Six months from the date they become payable as of 31st March 2011.

(b) According to the records of the Company, there was disputed statutory dues of Rs.10,00,000/- that have been deposited on account of the matters pending before appropriates authorities.

4(x)(a) The accumulated losses of the Company as on 31st March 2011 exceed 50 per ct of its net worth.

4(xi) According to the information and explanations given to us, the Company has not defaulted in any repayment of dues to any financial Institution or bank, as applicable, as at the Balance Sheet date.

4(xii) As explained 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 and therefore Paragraph 4(xii) of the said Order relating to maintenance of documents and records is not applicable.

4(xiii) The Company is not a Chit Fund / Nidhi / Mutual Benefit Fund/Societies. Therefore, the provisions of clause 4(xiii) are not applicable to the company.

4(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in securities.

4(xv) According to the information and explanations given to us, the Company has not given guarantees Loan taken by others from bank or financial institutions and thus clause 4(xv) is not applicable.

4(xvi) The Company has not taken any term loans and therefore clause 4(xvi) of the order is not applicable.

4(xvii) According to the information and explanations given to us, the Company has not raised any funds, short-term or long-term, during the period and therefore Clause 4(xvii) of the said Order relating to usage of such funds is not applicable.

4(xviii) According to the information and explanations given to us, during the year 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.

4(xix) According to the information and explanations given to us, during the year covered by our audit report, the Company has not issued any debentures.

4(xx) According to the information and explanations given to us, the Company has not made any public issue during the period and accordingly Paragraph 4(xx) of the said Order relating to end use of money raised is not applicable.

4(xxi) 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 Shayam Agrawal & Co.

Chartered Accountants

FIRM NO. 1102430

Sd/-

Proprietor

M. NO. 31774

Place: MUMBAI

Dated: 25th JUNE, 2011

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Mar 31, 2010

1. We have audited the attached Balance Sheet of M/S MANDSAUR FERRO ALLOYS LIMITED As At 31st March 2010 and also the Profit and Loss account and cash flow statement of the company 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.

2. We conducted our audit in accordance with auditing standard generally accepted in India. Those standards require that we plan and perform the audit to obtain the reasonable assurance about whether the financial statements are free of material misstatement. An Audit includes examining on a test basis, evidence supporting the amount 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 statements presentation. We believe that our audit provides a reasonable basis for our opinion.

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

4. Further to our comment 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 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 as prescribed by the ICAI.

v) On the basis of written representation received from the directors, as on 31st March, 2010 and taken on records by the Board of directors, We report that none of the directors are disqualified as on 31st March 2010 from being appointed as director in term 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 explanation given to us, the said Accounts reads with the notes there on and subject to : -

1. The non obtaining of confirmation of Balances from the Creditors and Debtors.

2. Non provision for Income Tax under dispute.

3. Non provision of interest at the rate of 18 % per annum on allotment money amounting to Rs. 25000/- not paid on the investment in shares on due date i.e. 30/11/1996.

4. Non provision for Doubtful Debts of Rs. 38.69 Lacs. In our opinion considered as Irrecoverable.

5. No provision has been made for Annual Listing Fees since F. Y. 1998-99 for which company has been listed with various stock exchanges.

6. Investment in shares which are unquoted is made at cost. No provision is made for any diminution in the value of shares if any, as the shares are not quoted in the market.

7. No provision has been made for the extent of Rs. 8,26,506/- to Madhya Pradesh State Electricity Board which is under dispute.

8. Non Provision of Loans to Employees, which are, in our opinion not recoverable.

Give the information required by the Companies Act, 1956 In the manner so required and give a true and fair view subject to point no. F (1) to F (7) above in conformity with the accounting principles generally accepted in India:

a) In the case of the Balance Sheet, of state of affairs of the company as at 31st March 2010,

And

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

And

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

ANNEXURE REFERRED TO IN PARAGRAPH (3) OF THE AUDITORS REPORT OF EVEN DATE TO THE MEMBERS OF M/S MANDSAUR FERRO ALLOYS LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED ON 31st MARCH 2010,

1. (a) The Company has not maintained proper records, showing full particulars including quantitative details and situation of its fixed assets.

(b). Physically verification of the fixed assets has not been conducted by the management during the year as all the assets have been auctioned by the M.P.S.E.B. and these assets are no in the possession of the company.

(c). We draw attention to note no. 8 to the notes of accounts. The Companys assets have been disposed off in an auction against the power dues of MPSEB of Rs. 90.00 Lacs. The company has so far no plan to replace the auctioned assets. As a result, based on the information and expiations given by the management and on the basis of audit procedures performed by us, we are of the opinion, that these factors raise substantial doubt the companys ability to continue as a going concern in the foreseeable future.

2. (a) As the company has not purchased sold goods during the year nor there is any opening stock, requirement of reporting on physical verification of stocks or maintenance of inventory records, in our opinion, does not arise.

3. (a) The company has taken loan from one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was 5,900/- and the year end balance of loan taken from such party was also Rs. 5900/-. The Company has not granted any loans to the Companies, Firms or other parties covered in the register maintained under section 301 of the Companies Act 1956.

(b). In our opinion, so far as loans taken from the party covered in the register maintained u/s 301 of the companies act 1956. The rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the company as no interest has been paid pn such loan. And no repayment period has been stipulated.

(c) As informed to us, no loans agreements were executed in respect of loan taken from the party covered u/s 301 of the companies act, 1956. Therefore, no repayment schedule has been fixed Also as per the books of account there seems no regularity in the payment of principal amount in respect of loan taken as the company has not given any loans to Companies, firms or other parties covered in section 301 of the companies act, 1956. Therefore, we offer no comments on the question on of regular payment of the principal amount and interest thereon.

(d) In absence of any agreement and stipulation regarding repayment of such loans, we are unable to offer our comments, whether there is any over due amount of loan taken from party covered u/s 301 of the companies act, 1956 requiring the company to initiate any reasonable steps for payment of the principal amount

4. Having regard to the nature of the companys business and based on our scrutiny of the companys records and information and explanations received by us. we report that the companys activities do not include purchase of inventory, fixed assets and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5. Based on the Audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that there were no transactions during the year that need to be entered into the register maintained u/s 301 of the companies Act, 1956.

6. Based on our scrutiny of the companys records and according to the information and explanations provided by the management, in our opinion, the company has not accepted any deposit from the public as referred to in provision of section 58A and 58AA of the Companies Act, 1956 to be read with Rule 2 (b) of the Companies (Acceptance of Deposits) Rule 1975.

7. The company has no internal audit system during the year covered by our report, as there was no activity.

8. According to information and explanations provided by the management though, the Central Government has not prescribed the maintenance of cost records by the Company under section 209 (1) (d) of the Companies Act, 1956, in respect of the products being manufactured by the company, but in absence of any manufacturing activities carried out by the company we therefore offer no comments on maintenance of cost records.

9. (a) According to the records of the Company and information and explanations provided by the management, we are of opinion that the company was not required to deposit any statutory dues during the year covered by our report, we therefore offer no comments about the regularity of depositing such statutory dues with appropriate authorities.

(b) Undisputed statutory dues including central sales tax, has not been regularly deposited with the appropriate authorities and there is delay in following cases

The Statement of arrears of statutory dues outstanding for more than six months is as under:

Name of the Nature of Amount Period to which statue the dues (Rs) the amount relates

Central Quarterly Rs. F.Y. 1999-2000 Sales Tax Demand 9832/- Act

Income Tax Regular Rs. 1.36 F.Y. 1991-92 Demand Lacs i.e. Assessment Year 1992-93)

Name of the Due Date Date of Payment Statue

Central January Not Sales Tax 2000 deposited till Act the date of the Audit Report.

Income Tax April 1999 Not deposited till the date of the Audit Report.

(C) According to the information and explanations given to us, there are following dues of Income tax which haves not been deposited on account of disputes as at 31st March, 2010 for a period of more than six months from the date they become payable

The statement of disputed dues is as under:

Name of the Nature of the Amount ( Rs.) statue dues

Income Tax Interest U/s 234 Rs. 1.93 Lacs

Income Tax Regular Demand Rs. 22.88 Lacs

Name of the Period to which Forum where statue the amount dispute is relates pending

Income Tax F.Y. 1991-92 ( Departments i.e. Assessment appeal before Year 1992-93) Income Tax Appellate Tribunal

Income Tax F.Y. 1992-93 ( Departments & i.e. Assessment Companys Year 1993-94) appeals before Income Tax Appellate Tribunal

10. he accumulated losses of the company have exceeded fifty percent of its net worth as at 31.03.2010 the company has incurred a cash loss of Rs 1825324/- in the current financial year covered by our audit and Rs. 5165/ in the immediately preceding financial year.

11. According to the records of the Company, the company has not borrowed from the financial institutions or bank or issued debentures till 31st March, 2010 Hence in our opinion the question of dues to the financial institutions or bank or debentures does not arise.

12. According to the information and explanations given to us and based on the documents and records produced to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion and to the best of our information and explanations provided by the management, we are of the opinion that the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore the provisions of clause 4 (xiii) of the companies (Auditors Report) Order, 2003 are not applicable to the company.

14. As per records of the company and the information and explanations provided to us by the management the Company is not dealing / trading in shares, securities, debentures and other investments. Therefore in our opinion the requirements of para 4 (xiv) of the companies (Auditors Report) order, 2003 do not apply to the company.

15. According the records of the company and the information & explanations provided by the management, the Company has not given any guarantee for loans taken by - the others from bank or financial institutions.

16. According to records of the company and the information & explanations given to us, the company has not raised any amount by way of term loans during the financial year under audit; therefore comments under the clause are not called for.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, We report that no funds raised on short-term basis have been used for long-term investment by the company. No long-term funds raised have been used to finance short-term assets.

18. According to records of the company and the information & explanations provided by the management, 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.

19. According to records of the company and the information and explanations given to us, the company has not issued debentures during the year and also in earlier years.

20. The Company has not raised any money through a public issue during the year

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

For Pankaj Rathi & Associates Chartered Accountants

(PANKAJ RATHI) Proprietor (M. No. 078622)

Place: Indore Dated: 17 AUG 2010

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Mar 31, 2002

We have audited the attached Balance sheet of MANDSAUR FERRO ALLOYS LIMITED, as at 31st March, 2002 and the annexed Profit and Loss Account 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

01. We conducted our audit in accordance with the auditing standards generally accepted in India. These standards require that we plan and perforrn the audit to obtain reasonable assurance about whether the friancial statements are free from any material missstatement. 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 presentation of the financial statements. We believe that our audtt provides a reasonable basis for our opinion.

02. As required by the manufacturing and other companies (Auditors Report) Order, 1988 issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956. We annex hereto a statementon the matters specified in paragraphs 4 &5 of the said order.

03. Further to our comments in the Annexure referred to 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 purpose of our audit.

b. In our opinion proper books of account as required by law have been kept by the company so for as it appears from our examinations of such books

c. The Balance Sheet and Profit & Loss Account dealt-with in this report are in agreement with the books of accounts.

d. In our opinion the Balance Sheet and the Profit & Loss account comptes with the mandatory accounting standards referred in section 211 (3C) of the Companies Act, 1956

e. Based on representations made by an the Directors of the company the information and explanations as made available, directors of the company do not pnma-facie have any disqualification as referred to in clause (g) of sub- section (1) of section 274 of the Act.

f. In our opinion and to the best of our infomation and according to the exptenations given to us the said account read with the notes there on and subject to;

1. The non obtaining of confirmation of Balances from the Creditors and Debtors.

2. Nonprovision for the Income Tax under dispute

3. Non provision of the interest at the rate of 18% per annum on allotment money amounting to Rs. 25,000/-- not paid on the investment in shares on due date i.e. 30-11-1996.

4. No provision for Doubtful Debts of Rs. 42.15 lacs has been made.

5. No prevision has been made for Annual listing lees since F.Y. 1998-99 for which company has been listed with various stock exchanges.

6. Investment in shares which are unquoted, is made at cost. No provision is made for any diminution in the value of shares if any. as the shares are not quoted in the market.

7. No provision has been made for to the extent of Rs:, 8,26,506/- to Madhya Pradesh State Electricity Board which is under dispute.

Gives the information required by the Companies Act, 1956 in the manner so required and gives a true and fair view in conformity with the accounting principles generally accepted in India:

i. ln lhe case of Balance Sheet of the state of affairs of the company as at 31st March, 2002 and

ii. In the case of Profit & Loss Account of the LOSS for the year ended on that date. ANNEXURE REFERRED TO IN PARAGRAH 2 OF OUR AUDITORS REPORT OF EVEN DATE ON THE ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2002 OF MANDSAUR FERRO ALLOYS LIMITED.

01. The Company has not maintained proper records showing full particulars including quantitative details and situation of Fixed Assets The question of physical verification of the assets of the company at reasonable intervals does not arise as on account of auction sale of the fixedasset belonging to the company by Madhya Pradesh state Electricity Board on 25.5.2001.

02. None of the fixed Assets of the company were revalued upto the date of auction i.e. 25.5.2001.

03. On account of seizure and auction of inventories on 25.5.2001 by Madhya Pradesh State Electricity Board, no physical verification was done by the management

04. The production activity of the company were closed down since May, 1999 and further on account of auction of the factory by Madhya Pradesh State Electricity Board on 25 5.2001.

05. The question of descripancies between physical stock and book stock does not arise as there was no physical verification was done by the management.

06. Since there was no slock at the end of the accounting year.The question of faimess of the valuation of standerds and arise

07. The Company has not taken loans from the companies, firms and other parties except old due to the Directors, listed i n the register maintained under section301 of the companies Act 1956 and are not prima-facie prejudicial to the interest of the company.

08. The company has not granted any loans, secured or unsecured to companies, firms or other parties feted in the register maintained under section 301 or to the companies under the same management, undersub-section(1B) of section 370 of the Companies Act, 1956.

09. The company has given interest free advances in the nature of loan in then normal course of business to businees to employees who are repaying the principal amount as stipulated except advances to the extent of Rs 28,309/-.

10. The question of adequate internal control procedures with regard to purchase of stores. Raw Materials including components, Plant and Machinaries, Equipments and other assets is not applicable, as no purchases were made during the year in the absence of any production activity.

11. According to the information and explanations given to us, there are no transaction of purchase and sale of goods and materials and services which were required to the extent in the register maintained under section 301 of the companies Act, 1956 aggregating during the period to Rs 50,000/- or more in respect of each party.

12. The procedure for determination of unseivicable or damaged stores, Raw Materials and Finished Goods does not arise on account of auction sate by Madhya Pradesh State Electrity Board on 2.5.2001.

13. The company has not accepted deposits from the public and as such, the provision of section 58-A of the CompaniesAct, 1956 and the rules framed there under have no application to this company

14. In our opinion, the question of maintenance of reasonable records for the sale and disposal of realisable scrap js not applicable, as there were no production activity during the year.

15. The Company has no internal audit system during the year under audit as there was no production activity.

16. The Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 in respect of the product of the company

17. The provision of depositing Employees State lnsurance and Provident Fund dues is not applicable to the company.

18. According to the infoimation and explanations given to us no undisputed amount payable in respect of lncome Tax, Wealth Tax, Sales Tax, Customs duty and Excise duty as on 31st March, 2002 fora period of more than six months from the date they became payable. Except the Central Sales Tax payable Rs.9,832/-.

19. During the course of our Examination of the books of account carried out in accordance with the generatly accepted auditing practices followed in India, we have not come across any personal expenses which have been charged to the Profit & Loss account other than those payable under contractual obligations and accepted business practices, nor have we been informed of such a case by the management.

20. The company is not a sick industrial company within the meaning of clause (o) of sub-section (1) of section 3 of the sick industrial companies (Special provisions) Act, 1985 being small scale industrial unit.

FOR C.H. PADLIYA & CO. CHARTERED ACCOUNTANTS. (C.H: PADLIYA) PLACE: BOTALGANJ, Distt. MANDSAUR. PARTNER DATED: THIS 13TH DAY OF AUGUST. 2002. M.NO : 1637