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Auditor Report of SAR Auto Products Ltd.

Mar 31, 2015

I have audited the accompanying financial statements of SAR AUTO PRODUCTS LIMITED ("the Company"), which comprises the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss and Cash Flow Statement for the year ended on that date, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these 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 includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; 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

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

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.

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.

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 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

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

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 31st March, 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, I give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act, I further report that:

A. 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.

B. 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.

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 accounts;

D. In my opinion, the aforesaid standalone financial statements comply with the applicable Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

E. On the basis of written representations received from the directors as on 31st March, 2015, 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 under sub-section (2) of Section 164 of the Act.

F. With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in my opinion and to the best of my information and according to the explanations given to me, I report as under:

I. The Company does not have any pending litigations which would impact its financial position.

II. The Company did not have any long-term contracts including derivative contracts for which there requires commenting on any material foreseeable losses.

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

As referred to in paragraph 1 of my report of even date, on the basis of such checks as I considered appropriate and according to the information and explanations given to me during the course of my audit, I report that:

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of two years which, in my opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets have been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(ii) (a) According to the information and explanation given to me, the inventory has been physically verified during the year by the management. In my opinion, the frequency of verification of inventory is reasonable.

(b) In my opinion and according to the information & explanations given to me, 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 has maintained proper records of inventory. As explained to me, there was no material discrepancies noticed on physical verification of inventory as compared to the book records.

(iii) According to the information and explanations given to me, during the year, the Company has not granted any loans, secured or unsecured loan to parties covered in the register maintained under Section 189 of the Companies Act, 2013.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and for sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weakness in internal controls.

(v) The Company has not accepted any deposits from the Public covered under Section 73 to 76 of the Companies Act, 2013.

(vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Companies Act, 2013 in respect of goods manufactured by the Company. According to the information and explanations given to me, The Companies (Cost Records & Audit) amendment Rules, 2014 is not applicable to the company.

(vii) In respect of statutory dues;

(a) According to the information and explanations given to me, the Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues apart from few cases of delay in payment of tax deducted at source.

(b) According to the information and explanations given to me, no undisputed amounts payable in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty and Cess were in arrears, as at 31st March, 2015 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to me, there were no amounts which were required to be transferred to the Investor Education and protection Fund by the company.

(viii) In my opinion, the Company has no accumulated losses. The Company has incurred cash losses amounting to Rs. 2,29,83,487/- during the year covered by my audit; however there were no cash losses in immediately preceding year financial year.

(ix) In my opinion and according to the information and explanations given to me, the Company has not defaulted in repayment of dues to financial institutions and banks.

(x) In my opinion, and according to the information and explanations given to me, the Company has not given guarantees for loans taken by others from banks or financial institutions. Accordingly, clause 4(xv) of the Order is not applicable.

(xi) In my opinion and according to the information and explanations given to me and on an overall examination, the company has not raised any term loan during the year. Accordingly, paragraph 4(xvi) of the Order is not applicable to the Company.

(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 Arun M. Kothari, Chartered Accountant

Arun M. Kothari Proprietor (Membership No.108669)

Ahmedabad, 11th May, 2015


Mar 31, 2013

Report on the Financial Statements

I have audited the accompanying financial statements of SAR AUTO PRODUCTS LIMITED ("the Company"), which comprises the Balance Sheet as at 31st March, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year the ended on that date, 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 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.

I believe that the audit evidence I have obtained is sufficient 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 financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

(b) in the case of the Statement of Profit and Loss, of the losses 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.

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. Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, In my opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

E. On the basis of written representations received from the directors as on 31st March, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Statement on the Companies (Auditor''s Report) Order, 2003

To, The Members, Sar Auto Products Limited

Referred to in paragraph 3 of my report of even date

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

(b) According to the information and explanation given to me, the fixed assets of the Company were physically verified by the management in a phased & periodical manner which, in my opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) During the year, the Company has not disposed off substantial part of fixed assets and the going concern statement of the Company is not affected.

(ii) (a) According to the information and explanation given to me, the inventory has been physically verified during the year by the management. In my opinion, the frequency of verification is reasonable.

(b) In my opinion and according to the information & explanations given to me, 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 has maintained proper records of inventory. As explained to me, there was no material discrepancies noticed on physical verification of inventory as compared to the book records.

(iii) (a) The Company has not granted loans to the party covered in the Register maintained under section 301 of the Companies Act, 1956. Accordingly,sub-clause (b), (c) and (d) of the clause (iii) does not apply.

(e) The Company has accepted secured or unsecured loans from party covered in the Register maintained under section 301 of the Companies Act, 1956.

Sr. Name of the Related Maximum amount due Balance due as at No. Party at any time during the end of the the year financial year Amount (Rs.) Amount (Rs.)

1 Mr. Ramesh D. Virani 13,48,690/- 1,18,690/-

2 Mr. Shreyas R. Virani 77,672/- 77,672/-

(f) In my opinion and according to the information and explanation given to me, the same is prima facie, not prejudicial to the interest of the company.

(g) There is no stipulation for repayment of the said loan.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchases of fixed assets and for sale of goods. During the course of my audit, I have not observed any continuing failure to correct major weakness in internal controls.

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

(b) In respect of transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs entered into during the financial year, because of the unique and specialized nature of the transaction and absence of any comparable prices, I are unable to comment whether the transactions were made at prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from the Public.

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

(viii) I 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(l)(d)of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. I have however, not made detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) In respect of statutory dues;

(a) According to the information and explanations given to me, the Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues apart from few cases of delay in payment of tax deducted at source.

(b) According to the information and explanations given to me, no undisputed amounts payable in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty and Cess were in arrears, as at 31st March, 2013 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to me, there are no dues in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty and Cess that have not been deposited with the appropriate authorities on account of any dispute.

(x) In my opinion, the Company has no accumulated losses. The Company has not incurred cash losses during the year and immediately preceding year financial year.

(xi) In my opinion and according to the information and explanations given to me, the Company has not defaulted in repayment of dues to a financial institutions and banks

(xii) In my opinion and according to the information & explanations given to me, no loans and advances have been granted on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, Clause 4 (xii) of the Order is not applicable.

(xiii) In my opinion, the Company is not a chit fund or a nidhi mutual benefit fund/ society. Accordingly, Clause 4 (xiii) of the Order is not applicable

(xiv) In my opinion, the Company has maintained proper records of transactions and contracts relating to dealing or trading in shares, securities, debentures and other investments during the year and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company in its own name except as permissible under Section 49 of the Companies Act, 1956.

(xv) In my opinion, and according to the information and explanations given to me, the Company has not given guarantees for loans taken by others from banks or financial institutions. Accordingly, clause 4(xv) of the Order is not applicable.

(xvi) In my opinion and according to the information and explanations given to me and on an overall examination, no term loan was raised during the year under review. Thus the provision of Clause (xvi) of the order 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) The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. Accordingly, clause 4(xviii) of the Order is not applicable.

(xix) The Company has not issued any debentures. Accordingly, clause 4(xix) of the Order is not applicable.

(xx) The Company has not raised any money by public issues during the year. Accordingly, clause 4(xx) of the Order is not applicable.

(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 ARUN M. KOTHARI, Chartered Accountant

Arun M. Kothari Proprietor (Membership No. 108669) Ahmedabad, 21st May, 2013


Mar 31, 2012

We have audited the attached Balance Sheet of SAR AUTO PRODUCTS LIMITED. as at 31st MARCH 2012, the Profit & Loss Account and 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.

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 management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

As required by the Companies (Auditor''s Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order Further to our comments in the Annexure referred to above, we report that:

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

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

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

(iv) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956

(v) On the basis of written representations received from the directors, as on 31st March, 2012 and taken on records by the Board of Directors, we report that none of the director is disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

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

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

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

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

Statement on the Companies (Auditor''s Report) Order, 2003

Referred to in paragraph 3 of our report of even date

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

(b) According to the information and explanation given to us, the fixed assets of the Company were physically verified by the management in a phased & periodical manner 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 verification.

(c) During the year, the Company has not disposed off substantial part of fixed assets and the going concern status of the Company is not affected.

(ii) (a) According to the information and explanation given to us, the inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information & explanations given to us, 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 has maintained proper records of inventory. As explained to us, there was no material discrepancies noticed on physical verification of inventory as compared to the book records.

(iii) (a) The Company has not granted loans to the party covered in the Register maintained under section 301 of the Companies Act, 1956. Accordingly, clause 4 (iii) (b), (c) and (d) does not apply.

(e) The Company has accepted secured or unsecured loans from party covered in the Register maintained under section 301 of the Companies Act, 1956.

Sr. Name of the Related Maximum amount due Balance due as at No. Party at any time during the end of the the year financial year Amount (Rs.) Amount (Rs.)

1 Mr. Ramesh D. Virani 14,30,000/- 10,48,690/-

2 Mr. Shreyas R. Virani 3,59,712/- 77,672/-

(f) In our opinion and according to the information and explanation given to us, the same is prima facie, not prejudicial to the interest of the company.

(g) There is no stipulation for repayment of the said loan.

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

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

(b) In respect of transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs entered into during the financial year, because of the unique and specialized nature of the transaction and absence of any comparable prices, we are unable to comment whether the transactions were made at prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from the Public.

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

(viii) 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 detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) In respect of statutory dues;

(a) According to the information and explanations given to us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues apart from few cases of delay in payment of tax deducted at source.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service 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 became payable.

(c) According to the information and explanations given to us, there are no dues in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty and Cess that have not been deposited with the appropriate authorities on account of any dispute.

(x) In our opinion, the Company has no accumulated losses. The Company has not incurred cash losses during the year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institutions and banks.

(xii) In our opinion and according to the information & explanations given to us, no loans and advances have been granted on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, Clause 4 (xii) of the Order is not applicable.

(xiii) In our opinion, the Company is not a chit fund or a nidhi mutual benefit fund/ society. Accordingly, Clause 4 (xiii) of the Order is not applicable

(xiv) In our opinion, the Company has maintained proper records of transactions and contracts relating to dealing or trading in shares, securities, debentures and other investments during the year and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company in its own name except as permissible under Section 49 of the Companies Act, 1956.

(xv) In our opinion, and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions. Accordingly, clause 4(xv) of the Order is not applicable.

(xvi) In our opinion and according to the information and explanations given to us and on an overall examination, no term loan was raised during the year under review. Thus the provision of Clause (xvi) of the order is not applicable.

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

(xviii) The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. Accordingly, clause 4(xviii) of the Order is not applicable.

(xix) The Company has not issued any debentures. Accordingly, clause 4(xix) of the Order is not applicable.

(xx) The Company has not raised any money by public issues during the year. Accordingly, clause 4(xx) of the Order is not applicable.

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

For ARUN M. KOTHARI, Chartered Accountant

Arun M. Kothari Proprietor (Membership No.108669) Ahmedabad, 29th May, 2012


Mar 31, 2011

We have audited the attached Balance Sheet of SAR AUTO PRODUCTS LIMITED as at 31st MARCH 2011, the Profit & Loss Account and Cash Row 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.

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 indudes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

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

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

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

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

(iv) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Row Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956

(v) On the basis of written representations received from the directors, as on 31st March, 2011 and taken on records by the Board of Directors, we report that none of the director is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

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

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2011;

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

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

Referred to in paragraph 3 of our report of even date

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

(b) According to the information and explanation given to us, the fixed assets of the Company were physically verified by the management in a phased & periodical manner 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 verification.

(c) During the year, the Company has not disposed off substantial part of fixed assets and the going concern status of the Company is not affected.

(ii) (a) According to the information and explanation given to us, the inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information & explanations given to us, 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 has maintained proper records of inventory. As explained to us, there was no material discrepancies noticed on physical verification of inventory as compared to the book records.

(iii) (a) The Company has not granted loans to the party covered in the Register maintained under section 301 of the Companies Act, 1956. Accordingly, clause 4 (iii) (b), (c) and (d) does not apply.

(e) The Company has accepted unsecured loans from two parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

Sr. Name of Related Party Maximum amount Balance due as No. due at any time at the end of during the year the financial year Amount (Rs.) Amount (Rs.) 1. Mr. Ramesh D. Virani 11,75,000 11,75,000

2. Mr. Shreyas R. Virani 7,79,712 1,79,712

(f) In our opinion and according to the information and explanations given to us, the same is prima fade, not prejudicial to the interest of the Company.

(g) There is no stipulation for repayment of the said loan.

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

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

(b) In respect of transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs entered into during the financial year, because of the unique and specialized nature of the transaction and absence of any comparable prices, we are unable to comment whether the transactions were made at prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from the Public.

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

(viii) The Central Government has prescribed the maintenance of cost records under section 209(l)(d) of the Companies Act, 1956 in respect of goods manufactured by the Company. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(ix) In respect of statutory dues;

(a) According to the information and explanations given to us, the Company is regular in depositing with appropriate authorities undisputed statutory dues induding Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues apart few cases of delay in payment of tax deducted at source.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs 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 became payable.

(c) According to the information and explanations given to us, there are no dues in respect of Provident Fund, ESIC, Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty and Cess that have not been deposited with the appropriate authorities on account of any dispute.

(x) In our opinion, the Company has no accumulated losses. The Company has not incurred cash losses during the year, but has incurred cash losses during the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institutions and banks.

(xii) In our opinion and according to the information & explanations given to us, no loans and advances have been granted on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, Clause 4 (xii) of the Order is not applicable.

(xiii) In our opinion, the Company is not a chit fund or a nidhi mutual benefit fund/ society. Accordingly, Clause 4 (xiii) of the Order is not applicable

(xiv) In our opinion, the Company has maintained proper records of transactions and contracts relating to dealing or trading in shares, securities, debentures and other investments during the year and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company in its own name except as permissible under Section 49 of the Companies Act, 1956.

(xv) In our opinion, and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions. Accordingly, clause 4(xv) of the Order is not applicable.

(xvi) In our opinion and according to the information and explanations given to us and on an overall examination, no term loan was raised during the year under review. Thus the provision of Clause (xvi) of the order is not applicable.

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

(xviii) The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. Accordingly, clause 4(xviii) of the Order is not applicable.

(xix) The Company has not issued any debentures. Accordingly, clause 4(xix) of the Order is not applicable.

(xx) The Company has not raised any money by public issues during the year. Accordingly, clause 4(xx) of the Order is not applicable.

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

For ARUN M. KOTHARI, Chartered Accountant Arun M. Kothari Proprietor Ahmedabad, 28th May, 2011 Membership No. 108669

 
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