Auditor Report of Real Strips Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of REAL STRIPS LIMITED('the Company'), which comprises the Balance sheet as at 31st March, 2015, the Statement of Profit and Loss and the Cash Flow statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these Financial statements that give a true and fair view of the Financial position, Financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the Auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial control 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.

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

Opinion

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

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31st, 2015;

(b) in the case of the Statement of Profit and Loss, of the loss 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, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable for the year.

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

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

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

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

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

(e) On the basis of the written representations received from the director as on 31st March 2015 and 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; and

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

(i) The Company has disclosed the impact of pending litigations on its Financial position in its financial statements in note no. 2.26 to the financial statements.

(ii) There are no long term contracts including derivative contracts and accordingly no provision is required to be made for any loss from the same; and

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

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT [ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF REAL STRIPS LIMITED, FOR THE FINANCIAL STATEMENTS FOR THE YEAR ENDED ON 31st MARCH 2015]

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

(b) The Company has a programme of physical verification of its fixed assets by which fixed assets are verified at regular intervals. In accordance with this programme fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(ii) (a) As informed to us, the inventory has been physically verified by the management during the year. In our opinion, the frequency of such physical verification is broadly reasonable.

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

(c) The Company is maintaining proper records of inventory. Discrepancies noted on physical verification of inventories, were not material, and have been properly dealt with in the books of accounts.

(iii) As informed to us, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013 ('the Act') and accordingly paragraph 3(iii) (a) & (b) of the Order are not applicable to the Company.

(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, for the purchase of inventory and fixed assets and sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) The Company has not accepted deposits from the public (other than exempted public deposits) and accordingly paragraph 3 (v) of the Order is not applicable.

(vi) We have broadly reviewed the books of accounts maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014 prescribed by the Central Government under sub section (1) of section 148 of the Companies Act, 2013 and are of the opinion that prima-facie, the prescribed accounts and records have been made and maintained. We have however not made a detailed examination of the same.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company is 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, value added tax, cess and other material statutory dues with the appropriate authorities.

Further no undisputed amounts payable in respect of above dues were in arrears as at 31st March 2015 for a period of more than six months from the date they became payable.

(b) On the basis of information furnished to us, following are the details of outstanding dues in respect of income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax or cess, which have not been deposited on account of any dispute:-

Name of the Statute Nature of dues Rs. In lakhs



Central Excise Act, 1944 Penalty 1.00 Customs Act, 1962 Finance Act, 1994 (Co Applicant)

Central Excises Act, Service Tax (Penalty) 1.37 1944

Central Excises Act, Service Tax (Penalty) 1.59 1944

Central Excises Act, Service Tax (Duty) 7.42 1944

Income tax Act, 1961 Income Tax 92.30



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

Central Excise Act, 1944 2003-04 Hon'ble CESTAT Customs Act, 1962 Finance Act, 1994 (Co Applicant)

Central Excises Act, 2008-09& Hon'ble Gujarat High 1944 2009-10 Court

Central Excises Act, 2010-11 Hon'ble CESTAT 1944

Central Excises Act, 2011-12 Hon'ble CESTAT 1944

Income tax Act, 1961 2011-12 Hon'ble Commissioner of Income Tax(Appeals)

(c) The amount required to be transferred to investor education and protection fund has been transferred within time in accordance with the relevant provisions of the Companies Act, 1956 and rules made there under.

(viii) There are no accumulated losses of the company at the end of the financial year. The Company has incurred cash loss in the current financial year and not in immediate preceding year.

(ix) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to any financial institution or Bank.

(x) The company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) During the year, the company has not taken any new Term Loans.

(xii) During the course of our examination of the books and records of the company, carried out in accordance with generally accepted practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

FOR, MEHTA LODHA & CO. (FIRM REGD.NO: 106250W) CHARTERED ACCOUNTANTS

PRAKASH D SHAH Place: Ahmedabad PARTNER DATE: 30th MAY, 2015 Membership .No. 34363

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Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 8/2014 dated April 4 2014 issued by the Ministry of Corporate Affairs. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

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

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 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, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement broadly comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956("the Act") read with the General Circular 8/2014 dated April 4 2014 issued by the Ministry of Corporate Affairs.

(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.

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT

(Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date of Real Strips Limited).

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

(b) As informed to us, a substantial portion of the fixed assets have been physically verified by the management during the year, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification.

(c) Fixed assets disposed off during the year were not substantial and therefore do not affect the going concern assumption.

(2) (a) As informed to us, during the year the management has conducted physical verification of the inventories and in our opinion the frequency of verification is reasonable.

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

(c) In our opinion and according to the information and explanation given to us, the Company has maintained proper records of inventory. As informed to us, the discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

(3) (a) As informed to us, the company has taken unsecured loan from the Companies, Firms and other parties listed in the register maintained under section 301 of the Companies Act, 1956. The aggregate of loan outstanding of 4 such persons as on the last day of the year is Rs. 510 Lacs. The rate of interest and the terms of repayment are not stipulated and other terms and conditions are not prima facie prejudicial to the interest of the company.

(b) As informed to us, the company has not given loans to the Companies, Firms and other parties listed in the register maintained under section 301 of the Companies Act.

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

(5) (a) 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 transactions that need to be entered into the register maintained under section 301 of the Companies Act 1956, have been so entered.

(b) In respect of transactions with parties with whom transactions exceeding value of Rs. 5 Lacs have been entered into during the financial year, are at the prices which are reasonable having regard to the prevailing market prices at the relevant time, except in case of transactions where we are unable to comment owing to the unique and specialized nature of the items and absence of any comparable prices, whether the transactions are made at the prevailing market prices at the relevant time or not.

(6) In our opinion and according to the information and explanation given to us, the company has not accepted deposits from the public as per the directives issued by the Reserve Bank of India and the provisions of section 58A, section 58AA and any other relevant provisions of the Act and the rules framed there under.

(7) The company has an internal audit system commensurate with the nature and size of the business. However there is scope to enlarge and strengthen the same.

(8) We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(9) (a) According to the records of the Company, the Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employee''s state insurance, income tax, sales tax, wealth tax, custom duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Sales Tax, Customs Duty, Excise Duty and cess were in arrears as at 31st March, 2014 for a period of more than six months from the date they become payable.

(c) According to the information and explanations given to us, the Company had no disputed outstanding statutory dues as at 31st March 2014 other than those stated below.

Name of the Nature of dues Rs. in Lacs Period to which Statute the amount relates

Central Excise Act, Penalty 1.00 2003-04 1944 Customs Act, 1962 Finance Act, 1994 (Co-Applicant)

Central Excise Act, Service Tax 1.37 2008-09 1944 (Penalty) 2009-10

Central Excise Act, Service Tax 1.59 2010-11 1944 (Penalty)

Income Tax Act, Income Tax 0.90 2010-11 1961

Central Excise Act, Service Tax 7.42 2011-12 1944 (Duty)



Name of the Statute Forum where dispute is pending

Central Excise Act,1944 Hon''ble CESTAT Customs Act, 1962 Finance Act, 1994 (Co-Applicant)

Central Excise Act,1944 Hon''ble Gujarat High Court

Central Excise Act,1961 Hon''ble CESTAT

Income Tax Act,1961 Hon''ble Commissioner (Appeals) of Income Tax-XI

Central Excise Act,1944 Hon''ble Commissioner (Appeals-I),Cental Excise. Ahmedabad

(10) In our opinion and on the basis of accounts, read with notes to accounts, there are no accumulated losses of the Company at the end of financial year and the Company has not incurred cash loss in the current financial year and in immediately preceding financial year.

(11) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to any financial institution or bank.

(12) We are of the opinion, that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

(14) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments and accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

(15) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions and accordingly the provision of clause 4(xv) of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company.

(16) According to the Cash Flow Statement and other records examined by us as well as information and explanations given to us on overall basis, term loan taken by the company has been utilized for the purpose for which they were raised.

(17) According to the Cash Flow Statement and other records examined by us as well as information and explanations given to us on an overall basis, we report that funds raised on short term basis have not prima-facie been used for long term investment, though surplus funds which were not required for immediate utilization have been gainfully invested in liquid investments payable on demand.

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

(19) The company has not issued any debentures and accordingly, the provisions of clause 4(xix) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(20) During the year, the company has not raised any money through a public issue and accordingly the provisions of clause 4(xx) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

(21) During the course of our examination of the books and records of the company, carried out in accordance with generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

FOR, MEHTA LODHA & CO. (FIRM REGD.NO: 106250W) CHARTERED ACCOUNTANTS

PRAKASH D. SHAH Place: AHMEDABAD PARTNER Date :29th May, 2014 M. No.34363

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Mar 31, 2012

1.) We have audited the attached Balance Sheet of REAL STRIPS LIMITED as at 31st March 2012, the Statement of Profit & Loss and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2.) We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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 the 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 as amended by the Companies (Auditor's Report) amended order,2004 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in the paragraph 4 & 5 of the said order, for the year under consideration.

4.) Further to our comments in the Annexure referred to in paragraph 3 above, we broadly 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 accounts as required by law have been kept by the company so far as it appears from our examination of those books.

c. The Balance Sheet, the Statement of Profit & Loss and Cash Flow Statement are in agreement with books of accounts.

d. In our opinion, the Balance Sheet, the Statement of Profit & Loss and Cash Flow Statement comply with the Accounting Standards referred to in Sub-Section (3C) of section 211 of the Companies Act, 1956, to the extent applicable.

e. As per the representation made by the Company and all its Directors, as on 31st March 2012, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on March 31st, 2012 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 according to the best of our information and explanations given to us, the said Balance Sheet and the Statement of Profit & Loss read together with the significant accounting policies and 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 principle generally accepted in India :

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

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

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

ANNEXURE TO THE AUDITOR'S REPORT

[REFERRED TO IN PARAGRAPH (3) OF THE AUDIT REPORT OF EVEN DATE TO THE MEMBERS OF REAL STRIPS LIMITED, ON THE ACCOUNTS FOR THE YEAR ENDED ON 31st MARCH, 2012.]

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

(b) As informed to us, a substantial portion of the fixed assets have been physically verified by the management during the year, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification.

(c) Fixed assets disposed off during the year were not substantial and therefore do not affect the going concern assumption.

2) (a) As informed to us, during the year the management has conducted physical verification of the inventories and in our opinion the frequency of verification is reasonable.

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

(c) In our opinion and according to the information and explanation given to us, the Company has maintained proper records of inventory. As informed to us, the discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

3) (a) As informed to us, the company has taken unsecured loan from the Companies, Firms and other parties listed in the register maintained under section 301 of the Companies Act, 1956 from one such party and the outstanding balance as on last date of the year is of Rs. 37227/-. The rate of interest and the terms of repayment are not stipulated and other terms and conditions are not prima facie prejudicial to the interest of the company.

(b) As informed to us, the company has not given loans to the Companies, Firms and other parties listed in the register maintained under section 301 of the Companies Act.

4) In our opinion and according to the information and explanations given to us, there are generally adequate internal control commensurate with the size of the company and the nature of its business with regards to purchases of inventory and fixed assets and for the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5) (a) 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 transactions that need to be entered into the register maintained under section 301 of The Companies Act 1956, have been so entered.

(b) In respect of transactions with parties with whom transactions exceeding value of Rs. 5 Lacs have been entered into during the financial year, are at the prices which are reasonable having regard to the prevailing market prices at the relevant time, except in case of transactions where we are unable to comment owing to the unique and specialized nature of the items and absence of any comparable prices, whether the transactions are made at the prevailing market prices at the relevant time or not.

6) In our opinion and according to the information and explanation given to us, the company has not accepted deposits from the public as per the directives issued by the Reserve Bank of India and the provisions of section 58A, section 58AA and any other relevant provisions of the Act and the rules framed there under.

7) In our Opinion, the Company has an Internal Audit Department system commensurate with the size and nature of its business; however there is further scope to enlarge and strengthen the same.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(l)(d) of the Companies Act, 1956, and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

9) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and 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 us, no undisputed amounts payable in respect of Income Tax, Sales Tax, Customs 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.

(c) There are no outstanding dues of Sales Tax, Income Tax, Custom Duty, Wealth Taxes, Excise Duty and Cess which have not been deposited on account of dispute.

10) In our opinion and on the basis of accounts, read with notes to accounts, there are no accumulated losses of the Company at the end of financial year and the Company has not incurred cash loss in the current financial year and in immediately preceding financial year.

11) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to any financial institution or bank.

12) We are of the opinion, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

14) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments and accordingly, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

15) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions and accordingly the provisions of clause 4(xv) of the Companies (Auditor's Report) Order, 2003 is not applicable to the Company.

16) According to the Cash Flow Statement and other records examined by us as well as information and explanations given to us on an overall basis, term loan taken by the company has been utilized for the purpose for which they were raised.

17) According to the Cash Flow Statement and other records examined by us as well as information and explanations given to us on an overall basis, we report that funds raised on short term basis have not prima-facie been used for long term investment, though surplus funds which were not required for immediate utilization have been gainfully invested in liquid investments payable on demand.

18) The Company has not made preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956.

19) The company has not issued any debentures and accordingly, the provisions of clause 4(xix) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

20) During the year, the company has not raised any money through a public issue and accordingly the provisions of clause 4(xx) of the Companies (Auditor's Report) Order, 2003 is not applicable to the Company.

21) During the course of our examination of the books and records of the company, carried out in accordance with generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

FOR, MEHTA LODHA & CO.

(FIRM REGN. NO: 106250W)

CHARTERED ACCOUNTANTS

MAHENDRA LODHA

PLACE: AHMEDABAD PARTNER

DATE: 29th May 2012. M. No. 70791

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Mar 31, 2010

1.) We have audited the attached Balance Sheet of REAL STRIPS LIMITED as at 31st March 2010, the Profit & Loss Account and the Cash Flow Statement 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.

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

3.) As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) amended order,2004 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in the paragraph 4 & 5 of the said order, for the year under consideration.

4.) Further to our comments in the Annexure referred to in paragraph 3 above, we broadly 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 accounts as required by law have been kept by the company so far as it appears from our examination of those books.

c. The Balance Sheet, Profit & Loss Account and Cash Flow Statement are in agreement with books of accounts.

d. In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement comply with the Accounting Standards referred to in Sub-Section (3C) of section 211 of the Companies Act, 1956, to the extent applicable.

e. As per the representation made by the Company and all its Directors, as on 31st March 2010, no directors is disqualified 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 according to the best of our information and explanations given to us, the said Balance Sheet and Profit and Loss Account read together with the significant accounting policies and 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 principle generally accepted in India :

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

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

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

ANNEXURE TO AUDITORS REPORT (Referred to in paragraph 3 of our report of even date to the Members of REAL STRIPS LIMITED, on the accounts for the year ended on 31st March 2010)

1) (A) The company has maintained records showing full particulars including quantitative details and situation of Fixed Assets.

(B) A substantial portion of the fixed assets have been physically verified by the management during the year, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such physical verification.

(C) During the year no substantial portion of the fixed assets has been disposed off.

2) (A) During the year the management has conducted physical verification of the inventories and in our opinion, the frequency of verification is reasonable.

(B) The procedures of physical verification of inventories followed by the management are reasonable and adequate having regard to the size of the Company and the nature of its business.

(C) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

3) (A) The Company has taken unsecured loan from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 from one such party of Rs.2 Crore and which has been repaid before the year end and its terms and conditions are not prejudicial to the interest of the company.

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

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

5) (A) In our opinion and according to the information and explanations given to us, the transactions that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(B) There is no transaction of value exceeding of Rs. Five lacs during the financial year, with each such party.

6) In our opinion and according to the information and explanations given to us, the Company has not accepted deposits from the public as per the directives issued by the Reserve Bank of India and the provisions of section 58A, section 58AA and any other relevant provisions of the Act and the rules framed there under.

7) In our opinion, the company has an internal audit system commensurate with the size and nature of its business, however there is further scope to enlarge and strengthen the same.

8) As informed to us, the Central Government has not prescribed for the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956, for the product of the company.

9) (A) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund, income tax, sales tax, wealth tax, custom duty, excise duty, cess and other material statutory dues applicable to it.

(B) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty, Excise Duty and cess were in arrears at 31st March 2010 for a period of more than six months from the date they become payable.

(C) There are no outstanding dues of Sales Tax, Income Tax, Custom Duty, Wealth Taxes, Excise Duty and Cess which have not been deposited on account of dispute.

10) The company does not have any accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

11) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank.

12) Based on our examination of the records and the information and explanations given to us, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13) The Company is not chit fund or a nidhi mutual benefit fund/ society and accordingly the provisions of clause 4(xiii) of the Companies (Auditors Report) order, 2003 is not applicable to the Company.

14) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments and accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors Report) 2003 are not applicable to the Company.

15) As informed to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions and accordingly the provisions of clause 4(xv) of the Companies (Auditors Report) order, 2003 is not applicable to the Company.

16) During the year no term loan has been raised by the company and accordingly the provisions of clause 4(xvi) of the Companies (Auditors Report) order, 2003 is not applicable to the Company.

17) According to the Cash Flow Statement and other records examined by us as well as information and explanations given to us on an overall basis, we report that funds raised on short term basis have not prima-facie been used for long term investment, though surplus funds which were not required for immediate utilization have been gainfully invested in liquid investment payable on demand.

18) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19) The Company has not issued any debentures and accordingly the provisions of clause 4(xix) of the Companies (Auditors Report) order, 2003 is not applicable to the Company.

20) The Company has not raised any money through public issue during the year and accordingly the provisions of clause 4(xx) of the Companies (Auditors Report) order, 2003 is not applicable to the Company.

21) 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, MEHTA LODHA & CO.

(FIRM REGD.NO: 106250W) CHARTERED ACCOUNTANTS



PRAKASH D.SHAH

PLACE : AHMEDABAD PARTNER

DATE : 29th May, 2010. M No. 34363