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Auditor Report of PCS Technology Ltd.

Mar 31, 2015

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

2. Management's Responsibility for the Standalone 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.

3. Auditor's Responsibility

i. My responsibility is to express an opinion on these standalone financial statements based on my audit.

ii. I 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.

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

iv. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

v. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion on the standalone financial statements.

4. Opinion

In my opinion and to the best of my information and according to the explanations given to me, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

5. Report on Other Legal and Regulatory Requirements

As required by 'the Companies (Auditor's Report) Order, 2015' issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the "Order"), and on the basis of such checks of the books and records of the Company as I considered appropriate and according to the information and explanations given to me, I give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

i. I have sought and obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purposes of my audit.

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

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

iv. In my opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014; read with Note 31 to the financial statements for the year ended 31st March 2015, regarding scheme of Amalgamation and Arrangement.

v. On the basis of the 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.

vi. 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 my opinion and to the best of my information and according to the explanations given to me:

a. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 30 to the financial statements;

b. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

c. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE TO THE AUDITOR'S REPORT (i) (a) The Company has maintained proper records showing full particulars including quantitative detailsand situation of fixed assets.

(b) The assets have been physically verified by the management during the year and no major discrepancies were noticed on such verification.

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

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) There is no stipulation as to the time period for payment of the principal amount of unsecured loans granted.

(b) There is no stipulation as to the time period for payment of the principal amount of unsecured loans granted. Hence, the provisions of sub-clauses (b) of clause (iii) of paragraph 3 of the Order are not applicable.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of business with regard to purchases of inventory, fixed asset and with regard to the sale of goods and services. During the course of my audit, no major weakness has been noticed in internal control system.

(v) The Company has not accepted any deposits from the public and hence, the provisions of clause (v) of paragraph 3 of the Order are not applicable to the Company.

(vi) The Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act 1956 for any of the products of the Company.

(vii) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund,employees' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise,vaue added tax,cess and any other statutory dues with the appropriate authorities.

According to the information and explanations given to me, no undisputed amounts payable in respect of provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues were in arrears as at 31st March 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to me, the status of disputed dues payable in respect of income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess as at 31st March 2015 is as follows:

1 The Commissioner Of Service Tax, Mumbai has passed an order confirming the demand of Rs.2,29,04,559 (Previous Year: Rs.4,69,24,929) u/s 73 of Finance Act 1994 purchase of software under category of Intellectual Property Rights for the period Dec2004 - Mar2009.

The Company has obtained the legal opinion that the software purchase does not attract provisions of Intellectual Property Rights under Service Tax Rules, and now is in process of filing appeal before Appellate Tribunal.

2 The Company has received a demand of Rs.19,12,633 from the Commissioner Of Central Excise, Pondicherry u/s 11A of Central Excise Act imposing Central Excise on pre-loading of software for the period Sept2006 - Mar2010.

The Company has filed an appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Chennai. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Chennai.

3 The Company has received a demand of Rs.5,04,995 from the Commissioner Of Central Excise (Appeal), Vapi on the ground of irregular availment of Central Excise during the period Apr2004 - Mar2005.

The Company has filed appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Ahmedabad. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Ahmedabad.

4 The Company has received a demand of Rs.44,28,762 from the Commissioner Of Central Excise(Appeal), Vapi on the ground of irregular availment of Central Excise during April 2004 - March 2005.

The Company has filed appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Ahmedabad. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Ahmedabad.

5 The Company has received a Show Cause Notice from Director of Intelligence demanding Rs. 2,15,40,551 u/s 28 of Custom Act 1962 on account of Custom Duty on import of OPK from Microsoft during the period of Apr2006 - Mar2007.

The proceedings are pending before Commissioner of Customs, Delhi. On the basis of the legal opinion obtained, the matter has merits in favor of the Company. The Company has deposited Rs. 50 lakhs as pre-deposit under protest.

6 The Company has received an order of Rs.43,11,000 in FY 2006-07 from Commissioner of Central Excise (Appeal) Mumbai on account of alleged non-submission of import documents of various goods under Project Import Regulation Act 1986.

The Company has filed as appeal before CESTAT Mumbai, on the grounds of merits of the case. The Hon'ble High Court of Judicature at Bombay has set aside the order of CESTAT dated 8th June 2006 for pre-deposit of Rs.15 lakhs.

7 The Company has received a show cause notice u/s 73 of Finance Act 1994 from Commissioner Of Service Tax, Mumbai demanding Rs.25,21,282 on account of wrong availment of Cenvat Credit for the period Apr2012 - Mar2013.

The Company has filed its reply denying the demand on the merits and grounds.

(c) During the financial year covered by my audit, no amount was required to be transferred to investor education and protection fund.

(viii) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by my audit or in the immediately preceding financial year.

(ix) According to the information and explanations given to me, the Company has not defaulted in repayment of dues to financial institutions or banks.

(x) In my opinion and according to the information and explanations given to me, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) The Company has not raised any new term loan during the year and therefore clause (xi) of the said Order relating to application of term loan for the purpose for which it was obtained is not applicable.

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

For S.C. Bandi & Co.

Chartered Accountants Firm Reg. No.130850W

S.C. BANDI

(Proprietor)

M.No.16932

Place: Mumbai Date : 30th May 2015


Mar 31, 2014

I have audited the accompanying financial statements of PCS Technology Limited ("the Company"), which comprise of the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements:

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub- section (3C) of section 211 of the Companies Act, 1956 ("the Act"). 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:

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that I 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 judgement, 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.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a base for my audit opinion.

Opinion:

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

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

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

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

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, I give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

a. I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of my audit;

b. in my opinion proper books of account as required by law have been kept by the Company so far as appears from my 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 my opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub section(3C) of section 211 of the Companies Act, 1956; read with note no. 31 of Notes to the Financial Statements for the year ended 31st March 2014, regarding scheme of Amalgamation and Arrangement.

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

ANNEXURE TO THE AUDITOR''S REPORT

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

(b) The assets have been physically verified by the management during the year and no discrepancies were noticed on such verification.

(c) The fixed assets disposed-off during the year; do not constitute a substantial part of the fixed assets of the Company.

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

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) The Company has granted loans to two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.270 lakhs and the balance at the end of the year is Rs.270 lakhs.

(b) In my opinion, the rate of interest and other terms and conditions on which loans have been granted to the companies, firms or other 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.

(c) There is no stipulation as to the time period for payment of the principal amount of unsecured loans granted. Hence, the provisions of sub-clauses (c) and

(d) of clause (iii) of paragraph 4 of the Order are not applicable.

(e) The Company has taken loans from five parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.988 lakhs and the balance at the end of the year is Rs.330 lakhs.

(f) In my opinion, the rate of interest and other terms and conditions on which loans have been taken from the companies, firms or other 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) There is no stipulation as to the time period for payment of the principal amount of unsecured loans taken.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of business with regard to purchases of inventory, fixed asset and with regard to the sale of goods and services. During the course of my audit, no major weakness has been noticed in internal control system.

(v) (a) In my opinion and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In my opinion, and according to the information and explanations given to me, the contracts and arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to the prevailing market price.

(vi) The Company has not accepted any deposits from the public and hence, the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

(vii) In my opinion and according to the information and explanations given to me, there is an adequate internal audit system commensurate with the size of the Company and the nature of its business.

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

(ix) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues with the appropriate authorities.

According to the information and explanations given to me, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues were in arrears as at 31st March 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to me, the status of disputed dues payable in respect of income tax, sales tax, wealth tax, service tax, custom duty, excise duty and cess, as at 31st March 2014 is as follows:

1 The Commissioner of Service Tax, Mumbai has passed an order confirming the demand of Rs. 2,29,04,559 (Previous Year: Rs. 4,69,24,929) u/s 73 of Finance Act 1994 purchase of software under category of Intellectual Property Rights for the period Dec. 2004 - Mar. 2009.

The Company has obtained the legal opinion that the software purchase does not attract provisions of Intellectual Property Rights under Service Tax Rules, and now is in process of filing appeal before Appellate Tribunal.

2 The Company has received a demand of Rs. 19,12,633 from the Commissioner of Central Excise, Pondicherry u/s 11A of Central Excise Act imposing Central Excise on pre-loading of software for the period Sept. 2006 - Mar. 2010.

The Company has filed an appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Chennai. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Chennai.

3 The Company has received a demand of Rs. 5,04,995 from the Commissioner Of Central Excise (Appeal), Vapi on the ground of irregular availment of Central Excise during the period Apr. 2004 - Mar. 2005.

The Company has filed appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Ahmedabad. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Ahmedabad.

4 The Company has received a demand of Rs. 44,28,762 from the Commissioner of Central Excise(Appeal), Vapi on the ground of irregular availment of Central Excise during April 2004 - March 2005.

The Company has filed appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Ahmedabad. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Ahmedabad.

5 The Company has received a Show Cause Notice from Director of Intelligence demanding Rs. 2,15,40,551 u/s 28 of Custom Act 1962 on account of Custom Duty on import of OPK from Microsoft during the period of Apr. 2006 - Mar. 2007.

The proceedings are pending before Commissioner of Customs, Delhi. On the basis of the legal opinion obtained, the matter has merits in favor of the Company.

(x) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by my audit or in the immediately preceding financial year.

(xi) According to the information and explanations given to me, the Company has not defaulted in repayment of dues to financial institutions or banks.

(xii) According to the information and explanations given to me, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities and hence the clause (xii) of paragraph 4 of the said Order relating to maintenance of documents and records are not applicable.

(xiii) In my opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/society. Therefore, the provisions of sub-clauses (a) to (d) of clause (xiii) of paragraph 4 of the said Order are not applicable to the Company.

(xiv) In my opinion, the Company is not dealing in shares, securities and debentures and hence, the provisions of clause (xiv) of paragraph 4 of the said Order are not applicable to the Company.

(xv) In my opinion and according to the information and explanations given to me, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The Company has not raised any new term loan during the year and therefore clause (xvi) of the said Order relating to application of term loan for the purpose for which it was obtained is not applicable.

(xvii) According to the information and explanations given to me and on an overall examination of the Balance Sheet of the Company, I report that no funds raised on short- term basis have been used for long-term investment.

(xviii) During the year, the Company has not made any preferential allotment of preference 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 during the financial year covered by my audit.

(xx) The Company has not raised any money by way of public issue during the year.

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

For S.C. Bandi & Co. Chartered Accountants Firm Reg. No.130850W

Place: Mumbai S.C. BANDI Date: 30th May 2014 (Proprietor) M. No. 16932


Mar 31, 2013

Report on the Financial Statements:

I have audited the accompanying fnancial statements of PCS Technology Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Proft and Loss and Cash Flow Statement for the year then ended, and a summary of signifcant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements:

Management is responsible for the preparation of these fnancial statements that give a true and fair view of the fnancial position, fnancial performance and cash fows of the Company in accordance with the Accounting Standards referred to in sub- section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the fnancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility:

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fnancial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the fnancial 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 fnancial 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 fnancial statements.

I believe that the audit evidence I have obtained is suffcient and appropriate to provide a basis for my audit opinion.

Opinion:

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

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

(b) in the case of the Statement of Proft and Loss, of the proft for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash fows 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, I give in the Annexure a statement on the matters specifed in paragraphs 4 and 5 of the Order.

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

a. I 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 my 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 Proft and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d. in my opinion, the Balance Sheet, Statement of Proft 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 March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualifed 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.

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

ANNEXURE TO THE AUDITOR''S REPORT

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

(b) The assets have been physically verifed by the management during the year and no discrepancies were noticed on such verifcation.

(c) The fxed assets disposed off during the year, do not constitute a substantial part of the fxed assets of the Company.

(ii) (a) The inventory has been physically verifed during the year by the management. In my opinion, the frequency of verifcation is reasonable.

(b) The procedures of physical verifcation of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verifcation between the physical stocks and the book records were not material.

(iii) (a) The Company has not granted any loans, secured or unsecured to companies, frms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of sub-clauses (a) to (d) of clause (iii) of paragraph 4 of the Order are not applicable to the Company.

(b) The Company has taken loans from fve parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.70.98 lakhs and the balance at the end of the year is Rs.9.98 lakhs.

(c) In my opinion, the rate of interest and other terms and conditions on which loans have been taken from the companies, frms or other 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.

(d) There is no stipulation as to the time period for payment of the principal amount of unsecured loans taken.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of business with regard to purchases of inventory, fxed asset and with regard to the sale of goods and services. During the course of my audit, no major weakness has been noticed in internal control system.

(v) (a) In my opinion and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In my opinion, and according to the information and explanations given to me, the contracts and arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to the prevailing market price.

(vi) The Company has not accepted any deposits from the public and hence, the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

(vii) In my opinion and according to the information and explanations given to me, there is an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(viii) On the basis of the records, I am of the opinion that prima-facie the cost records and accounts prescribed by the Central Government under Section 209(1)(d) of the Companies Act 1956 have been made and maintained in respect of the Company''s product to which the said rule are made applicable. However, I have not carried out any detailed examination of such accounts and records.

(ix) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues with the appropriate authorities.

According to the information and explanations given to me, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues were in arrears as at 31st March 2013 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to me, the status of disputed dues payable in respect of income tax, sales tax, wealth tax, service tax, custom duty, excise duty and cess, as at 31st March 2013 is as follows:

1 The Company has received a show cause notice u/s 73 of Finance Act 1994 from Commissioner Of Service Tax, Mumbai demanding Rs.4,69,24,929 on import of software under category of Intellectual Property Rights for the period Dec 2004 – Mar 2009.

The Company has obtained fled its reply denying the demand as the Service Tax on this kind of service was not applicable.

2 The Company has received a demand of Rs.19,12,633 from the Commissioner Of Central Excise, Pondicherry u/s 11A of Central Excise Act imposing Central Excise on pre-loading of software for the period September 2006 - March 2010.

The Company has fled an appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Chennai. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Chennai.

3 The Company has received a demand of Rs.5,04,995 from the Commissioner Of Central Excise (Appeal), Vapi on the ground of irregular availment of Central Excise during the period April 2004 - March 2005.

The Company has fled appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Ahmedabad. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Ahmedabad.

4 The Company has received a demand of Rs.44,28,762 from the Commissioner Of Central Excise(Appeal), Vapi on the ground of irregular availment of Central Excise during April 2004 - March 2005.

The Company has fled appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Ahmedabad. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Ahmedabad.

5 The Company has received a Show Cause Notice from Director of Intelligence demanding Rs. 2,15,40,551 u/s 28 of Custom Act 1962 on account of Custom Duty on import of OPK from Microsoft during the period of April 2006 - March 2007.

The Company is in process of fling suitable reply against the Show Cause Notice and the management expects favorable order on merits. The proceedings are pending before Commissioner of Customs, Mumbai.

6 The Company has received a demand of Rs.20,20,103 from Commissioner of Customs, Pune demanding differential Custom Duty on import of raw material used in manufacturing of copper clad laminates for the period from 1997-2002.

The Company has fled appeal before Appellant Tribunal Central Excise, Customs & Service Tax, Mumbai. Tribunal has passed the order granting stay on the demand. The proceedings are pending before the Tribunal at Mumbai.

(x) The Company has no accumulated losses and has not incurred any cash losses during the fnancial year covered by my audit or in the immediately preceding fnancial year.

(xi) According to the information and explanations given to me, the Company has not defaulted in repayment of dues to fnancial institutions or banks.

(xii) According to the information and explanations given to me, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities and hence the clause (xii) of paragraph 4 of the said Order relating to maintenance of documents and records are not applicable.

(xiii) In my opinion, the Company is not a chit fund or a nidhi/ mutual beneft fund/ society. Therefore, the provisions of sub-clauses (a) to (d) of clause (xiii) of paragraph 4 of the said Order are not applicable to the Company.

(xiv) In my opinion, the Company is not dealing in shares, securities and debentures and hence, the provisions of clause (xiv) of paragraph 4 of the said Order are not applicable to the Company.

(xv) In my opinion and according to the information and explanations given to me, the Company has not given any guarantee for loans taken by others from banks or fnancial institutions.

(xvi) The Company has raised new term loan during the year and the said term loan was applied for the purpose for which it was obtained.

(xvii) According to the information and explanations given to me and on an overall examination of the Balance Sheet of the Company, I report that no funds raised on short- term basis have been used for long-term investment.

(xviii) During the year, the Company has made preferential allotment of preference shares to promotors'' and promoter group companies covered in the register maintained under section 301 of the Act and in my opinion; the price at which shares have been issued is not prejudicial to the interest of the Company.

(xix) The Company has not issued any Debentures during the fnancial year covered by my audit.

(xx) The Company has not raised any money by way of public issue during the year.

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

For S.C. Bandi & Co.

Chartered Accountants

Firm Reg. No.130850W

S.C. BANDI

Place: Mumbai (Proprietor)

Date: 25th May 2013 M. No.16932


Mar 31, 2012

1) I have audited the attached Balance Sheet of PCS TECHNOLOGY LIMITED (the 'Company'), as at 31st March 2012, the Statement of Proft and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. These fnancial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these fnancial statements based on my audit.

2) I have conducted my audit in accordance with the auditing standards generally accepted in India. These standards require that I plan and perform the audit to obtain reasonable assurance about whether the fnancial statements are free from any material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fnancial statements. An audit also includes, assessing the accounting principles used and signifcant estimates made by management, as well as evaluating the overall presentation of the fnancial statements. I believe that my audit provides a reasonable basis for my opinion.

3) As required by the Companies (Auditor's Report) Order, 2003 (the Rs.Order') issued by the Central Government in terms of sub-section (4A) of section 227 of the Companies Act, 1956, and on the basis of such checks of books and records of the Company as I considered necessary and appropriate and according to the information and explanations given to me during the course of the audit, I enclose in the Annexure, a statement on the matters specifed in paragraph 4 and 5 of the said Order.

4) Further to my comments in the Annexure referred to in paragraph 3 above, I report that:

a) I have obtained all the information and explanations, which to the best of my knowledge and belief were necessary for the purpose of my audit.

b) In my opinion proper books of accounts as required by law have been kept by the Company so far as appears from my examination of those books.

c) The Balance Sheet, Statement of Proft and Loss and Cash Flow Statement referred to in this report are in agreement with the books of accounts.

d) In my opinion the Balance Sheet, Statement of Proft and Loss and the Cash Flow Statement referred to in this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

e) Based on the representations made by the Directors as on 31st March 2012, and taken on record by the Board of Directors of the Company and the information and explanations given to me, none of the Director is, as at 31st March, 2012, prima-facie disqualifed from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f) In my opinion and to the best of my information and according to the explanations given to me, the said accounts 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:

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

ii) in the case of the Statement of Proft and Loss, of the proft of the Company for the year ended on that date; and

iii) in the case of the Cash Flow Statement, of the cash fows for the year ended on that date.

ANNEXURE TO THE AUDITOR'S REPORT

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

(b) The assets have been physically verifed by the management during the year and no discrepancies were noticed on such verifcation.

(c) The fxed assets disposed off during the year, constitute a substantial part of the fxed assets of the Company, however, in my opinion, this do not affect the going concern assumption.

(ii) (a) The inventory has been physically verifed during the year by the management. In my opinion, the frequency of verifcation is reasonable.

(b) The procedures of physical verifcation of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verifcation between the physical stocks and the book records were not material.

(iii) (a) The Company has not granted any loans, secured or unsecured to companies, frms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of sub-clauses (a) to (d) of clause (iii) of paragraph 4 of the Order are not applicable to the Company.

(b) The Company has taken loans from fve parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 6,898/- lacs and the balance at the end of the year is Rs. 6,173/- lacs

(c) In my opinion, the rate of interest and other terms and conditions on which loans have been taken from the companies, frms or other 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.

(d) There is no stipulation as to the time period for payment of the principal amount of unsecured loans taken.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of business with regard to purchases of inventory, fxed asset and with regard to the sale of goods and services. During the course of my audit, no major weakness has been noticed in internal control system.

(v) (a) In my opinion and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In my opinion, and according to the information and explanations given to me, the contracts and arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to the prevailing market price.

(vi) The Company has not accepted any deposits from the public and hence, the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

(vii) In my opinion and according to the information and explanations given to me, there is an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(viii) On the basis of the records, I am of the opinion that prima-facie the cost records and accounts prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 have been made and maintained in respect of the Company's product to which the said rule are made applicable. However, I have not carried out any detailed examination of such accounts and records.

(ix) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to me, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, service tax, custom duty, excise duty and cess were in arrears, as at 31st March, 2012 for a period of more than six months from the date they become payable.

(x) The Company has no accumulated losses and has not incurred any cash losses during the fnancial year covered by my audit or in the immediately preceding fnancial year.

(xi) According to the information and explanations given to me, the Company has not defaulted in repayment of dues to fnancial institutions or banks.

(xii) According to the information and explanations given to me, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities and hence the clause (xii) of paragraph 4 of the said Order relating to maintenance of documents and records are not applicable.

(xiii) In my opinion, the Company is not a chit fund or a nidhi/mutual beneft fund/society. Therefore, the provisions of sub-clauses (a) to (d) of clause (xiii) of paragraph 4 of the said Order are not applicable to the Company.

(xiv) In my opinion, the Company is not dealing in shares, securities and debentures and hence, the provisions of clause (xiv) of paragraph 4 of the said Order are not applicable to the Company.

(xv) In my opinion and according to the information and explanations given to me, the Company has not given any guarantee for loans taken by others from banks or fnancial institutions.

(xvi) The Company has raised new term loan during the year and the said term loan was applied for the purpose for which it was obtained.

(xvii) According to the information and explanations given to me and on an overall examination of the balance sheet of the Company, I report that no funds raised on short-term basis have been used for long-term investment.

(xviii) 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) The Company has not issued any Debentures during the fnancial year covered by my audit.

(xx) The Company has not raised any money by way of public issue during the year.

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



For S.C. BANDI & CO. Chartered Accountants Firm Reg. No. 130850W



S.C.BANDI Place: Mumbai (Proprietor) Date : 18th October, 2012 Membership no.16932


Mar 31, 2011

1) I have audited the attached Balance Sheet of PCS TECHNOLOGY LIMITED, as at 31st March, 2011 and Profit and Loss Account and the Cash Flow statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. My responsibility is to express an opinion on these financial statements based on audit.

2) I have conducted audit in accordance with the auditing standards generally accepted in India. These Standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from any material misstatement. An audit also 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. I believe that my audit provides a reasonable basis for my opinion.

3) As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of such checks of books and records of the Company as I considered necessary and appropriate and according to the information and explanations given to me during the course of the audit, enclose in the Annexure, a Statement on the matters specified in Paragraph 4 & 5 of the said order.

4) Further to my comments in the Annexure referred to in Paragraph 3 above, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of audit.

b) In my opinion proper books of accounts as required by Law have been kept by the Company so far as appears from my examination of such books.

c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement referred to in this report are in agreement with the books of accounts.

d) In my opinion the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement complies with the mandatory Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

e) Based on the representations made by the Directors as on 31st March, 2011 and taken on record by the Board of Directors of the Company and the information and explanations given to me, none of the Director is, as at 31st March, 2011, prima-facie disqualified from being appointed as a director in terms of clause (g) of sub-section (1) of Section

" 274 of the Companies Act, 1956.

f) In my opinion and to the best of my information and according to the explanations given to me, the said accounts 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 :

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2011 and

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

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

ANNEXURE TO THE AUDITORS' REPORT

(i) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets. The assets have been physically verified by the Management during the year and no discrepancies were noticed on such verification.

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

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(b) The Company has taken loans from five parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the period was Rs.7,161/- lacs and the balance at the end of the period is Rs.6,323/- lacs

(c) In my opinion, the rate of interest and other terms and conditions on which loans have been taken from the companies, firms or other 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.

(d) There is no stipulation as to the time period for payment of the principal amount of unsecured loans and advances taken.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of business with regard to purchases of inventory, fixed asset and with regard to the sale of goods. During the course of my audit, no major weakness has been noticed in internal control system in respect of these areas.

(v) (a) In my opinion and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In my opinion, and according to the information and explanations given to me, the contracts and arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to the prevailing market price

(vi) The Company has not accepted any deposits from the public and hence, the provisions of clause 4 (vi) of the Companies (Auditor's Report) Order 2003 are not applicable to the Company.

(vii) In my opinion and according to the information and explanations given to me, there is an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(viii) On the basis of the records, I am of the opinion that prima-facie the cost records and accounts prescribed by the Central Government under Section 209(1) (d) of the Companies Act 1956 have been made and maintained in respect of the Company's product to which the said rule are made applicable. However, I have not carried out any detailed examination of such accounts and records.

(ix) (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, custom duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to me, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, custom duty, excise duty and cess were in arrears, as at 31st March, 2011 for a period of more than six months from the date they become payable.

(x) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by my audit or in the immediately preceding financial year.

(xi) According to the information and explanations given to me, the Company has not defaulted in repayment of dues to financial institutions or banks.

(xii) According to the information and explanations given to me, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities and hence the clause (xii) of the said Order relating to maintenance of documents and records are not applicable.

(xiii) In my opinion, the Company is not a chit fund or a 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 my opinion, the Company is not dealing in Shares, Securities and Debentures and hence, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

(xv) In my opinion and according to the information and explanations given to me, the Company has not given any guarantee for loans taken by others from Banks or Financial institutions.

(xvi) The Company has raised new Term loan during the year and the said Term loan was applied for the purpose for which it was obtained.

(xvii) According to the information and explanations given to me and on an overall examination of the balance sheet of the Company, I report that no funds raised on short-term basis have been used for long-term investment.

(xviii) 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) The Company has not issued any Debentures during the financial year covered by my audit.

(xx) The Company has not raised any money by way of public issue during the year.

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

For S.C. BANDI & CO.

Chartered Accountants

S.C.BANDI

(Proprietor) Membership no.16932

31st May, 2011


Mar 31, 2010

1) I have audited the attached Balance Sheet of PCS TECHNOLOGY LIMITED, as at 31st March, 2010 and Profit and Loss Account and the Cash Flow statement ofsthe Company for the period ended on that date annexed thereto. These financial statements are the responsibility of the Companys Management. My responsibility is to express an opinion on these financial statements based on audit.

2) I have conducted audit in accordance with the auditing standards generally accepted in India. These Standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from any material misstatement. An audit also 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. I believe that my audit provides a reasonable basis for my opinion.

3) As required by the Companies (Auditors Report) Or- der, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of such checks of books and records of the Company as I considered necessary and appropri- ate and according to the information and explanations given to me during the course, of the audit, enclose in the Annexure, a Statement on the matters specified in Paragraph 4 & 5 of the said order.

4) Further to my comments in the Annexure referred to in Paragraph 3 above, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of audit.

b) In my opinion proper books of accounts as required by Law have been kept by the Company so far as appears from my examination of such books.

c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement referred to in this report are in agree- ment with the books of accounts.

d) In my opinion the Balance Sheet, the Profit and Loss Ac- count and the Cash Flow Statement complies with the mandatory Accounting Standards referred to in sub-sec- tion (3C) of Section 211 of the Companies Act, 1956.

e) Based on the representations made by the Directors as on 31st March, 2010 and taken on record by the Board of Directors of the Company and the information and explanations given to me, none of the Director is, as at 31st March, 2010, prima-facie disqualified from being appointed as a director in terms of clause (g) of sub- section (1) of Section 274 of the Companies Act, 1956.

f) In my opinion and to the best of my information and according to the explanations given to me, the said accounts give the information required by the Com- panies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India :

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010 and

ii) In the case of the Profit and Loss Account, of the profit of the Company for the period ended on that date.

iii) In the case of the Cash Flow Statement, of the cash flows for the period ended on that date.

ANNEXURE TO THE AUDITORS REPORT

(i) The Company has maintained proper records showing full particulars including quantitative details and situa- tion of Fixed Assets. The assets have been physically verified by the Management during the period and no discrepancies were noticed on such verification.

(ii) (a) The inventory has been physically verified during the period by the management. In my opinion, the frequency of verification is reasonable.

(b) The procedures of physical verification of invento- ries followed by the management are reasonable and adequate in relation to the size of the Com- pany and the nature of its business.

(c) The Company is maintaining proper records of in- ventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) The Company has not granted any loans, se- cured or unsecured to companies, firms or other parties covered in the register maintained un- der Section 301 of the Companies Act, 1956.

(b) The Company has taken loans from five parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the period was Rs.6,260/- lacs and the balance at the end of the period is Rs.6,110/-lacs

(c) In my opinion, the rate of interest and other terms and conditions on which loans have been taken from the companies, firms or other 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.

(d) There is no stipulation as to the time period for payment of the principal amount of unsecured loans and advances taken.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of business with regard to purchases of inventory, fixed asset and with regard to the sale of goods. During the course of my audit, no major weakness has been noticed in internal control system in respect of these areas.

(v) (a) In my opinion and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In my opinion, and according to the information and explanations given to me, the contracts and arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to the prevailing market price

(vi) The Company has not accepted any deposits from the public and hence, the provisions of clause 4 (vi) of the Companies (Auditors Report) Order 2003 are not applicable to the Company.

(vii) In my opinion and according to the information and explanations given to me, there is an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(viii) On the basis of the records, I am of the opinion that prima-facie the cost records and accounts prescribed by the Central Government under Section 209(1) (d) of the Companies Act 1956 have been made and maintained in respect of the Companys product to which the said rule are made applicable. However, I have not carried out any detailed examination of such accounts and records.

(ix) (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, custom duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to me, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, custom duty, excise duty and cess were in arrears, as at 31st March, 2010 for a period of more than six months from the date they become payable.

(x) The Company has no accumulated losses and has not incurred any cash losses during the financial period covered by my audit or in the immediately preceding financial year.

(xi) According to the information and explanations given to me, the Company has not defaulted in repayment of dues to financial institutions or banks.

(xii) According to the information and explanations given to me, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities and hence the clause (xii) of the said Order relating to maintenance of documents and records are not applicable.

(xiii) In my opinion, 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.

(xiv) In my opinion, the Company is not dealing in Shares, Securities and Debentures and hence, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

(xv) In my opinion and according to the information and explanations given to me, the Company has not given any guarantee for loans taken by others from Banks or Financial institutions.

(xvi) The Company has raised new Term loan during the period and the said Term loan was applied for the purpose for which it was obtained.

(xvii) According to the information and explanations given to me and on an overall examination of the balance sheet of the Company, I report that no funds raised on short- term basis have been used for long-term investment.

(xviii) During the period, 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 during the financial period covered by my audit.

(xx) The Company has not raised any money by way of public issue during the period.

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

For S.C. BANDI & CO.

Chartered Accountants

S.C.BANDI

(Proprietor)

Membership no. 16932

Place: Mumbai

Date: 31st May, 2010

 
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