Auditor Report of Servoteach Industries Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Servo tech Engineering Industries Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2015 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

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (The Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies: making judgements 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.

Auditors' 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 misstatements.

audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the 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 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 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 accompanying 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, 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 (Auditors' Report) Order, 2015 ("the Order"), issued by the Central Government of India in terms of sub-section (1) 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.

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

a. We have sought and obtained all information and explanation which to the best of our knowledge and belief were necessary for the purpose s of our audit;

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

c. The Company had no Branch offices during the year under audit.

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

e. 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;

f. On the basis of the written representations received from the directors as on March 31, 2015, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of Section 164 (2) of the Act;

g. 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 explanation given to us :

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

II. The Company has no long-term contracts including derivative contracts; as such the question of commenting on any material foreseeable losses thereon does not arise.

III. There has not been an occasion in case of the group during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of delay in transferring such sums does not arise.

ANNEXURE REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING "REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF THE SERVO TECH ENGINEERING INDUSTRIES LIMITED, WE REPORT THAT:

Clause Sub Particulars

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

(b) As per information provided to us, fixed assets have been physically verified by management at reasonable intervals and there were no material discrepancies noted during such verification.

(ii) The Company does not have any inventory.

(iii) The Company has not granted any loan to parties covered in the register maintained under section 189 of the Companies Act, 2013 ('the Act'). Thus, paragraph 3(iii) of the Order is not applicable.

(iv) In our opinion and according to explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regards to purchase of fixed assets and sale of service. We have not observed any major weakness in the internal control system during the course of the audit.

(v) The Company has not accepted deposit from the public.

(vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, duty of customs, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income tax, sales tax, wealth tax, service tax, duty of customs, value added tax, cess and other material statutory dues were in arrears as at 31 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 us and the records of the Company examined by us, there are no dues of income-tax, sales-tax, wealth-tax, service-tax, customs duty, and excise duty on account of any dispute except a sum of Rs. 2,12,960/- on account of Provident Fund.

(c) There has not been an occasion in case of the company during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of reporting any delay in transferring such sums does not arise.

(viii) The accumulated losses of the company have exceeded fifty percent of its net worth. The Company has accumulated losses of Rs 36,870,538/- at the end ot the financial year and has incurred cash losses in the financial year covered by our audit.

(ix) The Company did not have any outstanding dues to financial institutions, banks or debenture holders during the year.

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

(xi) The Company has not taken any term loan during the year.

(xii) Based on the audit procedures performed and information and explanation given by the management, we report that no fraud or by the company has been noticed or reported during the year.

For Amar Bafna & Associates Chartered Accountants Firm Registration No: 114854W

Amar Bafna Partner Membership No. 048639

Place: Mumbai Date: May 25,2015

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Mar 31, 2014

We have audited the accompanying financial statements of Servotech Engineering Industries Limited (the "Company"), which comprise 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, which we have signed under reference to this report.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act) read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and in accordance with accounting principle generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing and other applicable authoritative pronouncements 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 auditors'' 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 auditors consider 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, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. 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 accompanying 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 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, 2003'', as amended by ''the Companies (Auditor''s Report) (Amendment) Order, 2004'', issued by the Central Government of India in terms of sub-section (4A) of section 227 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 we considered appropriate and according to the information and explanations given to us, 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 dealt with by this report comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

(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 Act.

ANNEXURE REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING "REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF THE SERVOTECH ENGINEERING INDUSTRIES LIMITED.

Clause Sub Particulars

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

(b) As per information provided to us, the fixed assets have been physically verified by the management at reasonable intervals and there were no material discrepancies noted during such verification.

(c ) There was no substantial disposal of fixed assets during the year.

(ii) The Company does not have any inventory.

(iii) (a) The Company has not granted/taken any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 301 of the Act. Hence the sub-clause (a) to (g) is not applicable to the Company.

(iv) In our opinion and according to explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business. During the process of audit, no major weakness has been noticed in the internal control.

(v) According to the information and explanations provided by the management, we are of the opinion that the contracts or arrangements that need to be entered into the register required to be maintained under Section 301 of the Act, has been entered.

(vi) The Company has not accepted deposit from the public under section 58A and 58AA of the Companies Act and rules framed there under.

(vii) The company does not have an formal internal audit system.

(viii) As informed to us, there are no cost records prescribed by the central government under sec. 209(1)(d) of the Act, hence this clause is not applicable.

(ix) (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues, including provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income-tax, sales-tax, wealth-tax, service-tax, customs duty, and excise duty which have not been deposited on account of any dispute except a sum of Rs.2,12,960/- on account of Provident Fund.

(c) According to information and explanations given to us, there are no amounts pending on account of disputes with any statutory authorities.

(x) The accumulated losses of the company have exceeded fifty percent of its net worth. The Company has accumulated losses of Rs. 35,713,754/- at the end of the financial year and has incurred cash losses during the financial year covered by our audit.

(xi) Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution or banks.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares debentures and other securities.

(xiii) The Company not being Chit Fund / Nidhi / mutual Benefit Fund this clause and sub clause (a) (b) (c) (d) are not applicable

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to the Company.

(xv) As informed to us the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) The Company had not taken any term loan during the year.

(xvii) Based on the examination of documents and records made available and on the basis of information and explanations given to us, the Company has not used funds raised on short term basis for long term investments and vice versa.

(xviii) 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.

(xix) The Company has not issued any debentures; hence this clause does not applies.

(xx) The Company has not raised any money by public issue; hence this clause is not applicable.

(xxi) Based on the audit procedures performed and information and explanation given by the management, we report that no fraud on or by the company has been noticed or reported during the year.

For Amar Bafna& Associates Chartered Accountants Firm Registration No: 114854W

Place : Mumbai Amar Bafna Date : May 29th, 2014 Partner – M No. 048639

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Mar 31, 2011

1. We have audited the attached Balance Sheet of M/s SERVOTECH ENGINEERING INDUSTRIES LTD. As the 31st March, 2011 the Profit & Loss Account of the company and also the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have 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 disclosure 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 issued by the Central Government in terms of Sub Section (4A) of Section 227 of the companies act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph (3) above, we state that

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

b) In our opinion proper books of accounts as required by law have been kept by the company, so far as appears from our examination of such books.

c) The Balance Sheet and Profit and Loss Account dealt with by this Report are in agreement with the books of accounts of the Company.

d) In our opinion, the Profit and Loss Account and Balance Sheet comply with the accounting standards referred to in Sub-section (3C) of Section 211 of the Companies Act, 1956.(Except retirement benefits which are accounted for on cash basis.)

e) On the basis of the written representations received from the directors and taken on record by the board of Directors, we report that none of the Directors is disqualified as on March 31, 2011, from being appointed as a Director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act 1956.

f) Attention is invited to the following notes in schedule 18 :

i) Note No. 4 regarding Debts considered doubtful for of recovery amounting to Rs.34,15,744 for which no provision has been made in accounts

ii) Note No. 5 regarding Non- Provision of retirement benefits. In our opinion and to the best of our information and according to the explanations given to us , subject to our comments as referred to in (f) above impact of which is presently not ascertainable, the said accounts read with other notes thereon give the information required by the Companies Act, 1956 in the manner so required give true and fair view and conformity with the general accounting principles accepted in India :

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

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

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

ANNEXURE REFERRED TO THE AUDITORS' REPORT TO THE MEMBERS OF SERVOTECH ENGINEERING IND. LTD. FOR THE YEAR ENDED 31ST MARCH, 2011.

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

b) As explained to us, the fixed assets have been physically verified by the management during the year. The Company has a phased Program of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assented.

2. The company has no inventory.

3. The Company has granted unsecured loans & Advanced amounting to Rs.10,11,642/- to The companies, covered in the register maintained under section 301 of the Companies Act, 1956. They are not regular in repayment of principle & interest. This is informed to us the management trying to recover the same. The Company has not taken unsecured loan from company's 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, internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventories, fixed assets and for the sale of goods needs to be strengthened.

5. In our opinion, and according to the information and explanations given to us, the transactions that need to be entered in the register in pursuance of section 301 of the Act have been so entered.

6. The Company has not accepted any deposits from the public and consequently, the directive issued by the Reserve Bank of India, the Provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable.

7. The Company dose not have formal internal audit system.

8. The provisions regarding maintenance of cost records are not applicable to the Company.

9. In Respect of Statutory Dues.

a) The company is not regular in depositing Provident fund with appropriate authorities a sum of Rs. 2,12,966/- on a/c of provident fund is outstanding as on 31st March 2011

b) According to the information and explanations given to us, there are no undisputed amount payable in respect of such statutory due which have remained outstanding as at 31.03.2011 for a period of more than six months from date they become payable Apart from that, a sum of Rs. 2,12,966/- on a/c of provident fund is still outstanding.

C) According to the information and explanations given to us, there are no dues of

income tax, Wealth Tax, Sales Tax, Excise duty. Custom Duty & Cess which have not been deposited on account of dispute.

10. The Company has accumulated losses of Rs.2,97,67,447/- at the end of the financial year and has not incurred cash losses during the financial year covered by our audit.

11. The Company has not granted loans and advances 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.

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

13. According to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. Accordingly clause 4(xiv) of the order is not applicable.

14. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions. Accordingly, clause 4(xiv) of the order is not applicable.

15. In our opinion, the company has not taken any term loan during the year.

16. On the basis of an over all examination of the balance sheet of the company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short term basis which have been used for long term investment, and vice versa.

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

18. The Company has not issued any debentures during the year. Accordingly, clause 4(xix) of the order is not applicable.

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

20. During the course of our examination of the books and records of the Company carried out in Accordance with the generally accepted auditing practices in India, and according to the Information and explanations given to us, no fraud on or by the company has been noticed or reported during the audit.

FOR D.C. SURANA & ASSOCIATES

Chartered Accountants

Sd/-

Place : Mumbai (Proprietor)

Date : 29th August,2011 M.No.100-34074

F.R.NO. 115961W

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Mar 31, 2010

1. We have audited the attached Balance Sheet of M/s SERVOTECH ENGINEERING INDUSTRIES LTD. As the 31st March, 2010 the Profit & Loss Account of the company and also the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have 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 disclosure 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 issued by the Central Government in terms of Sub Section (4A) of Section 227 of the companies act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph (3) above, we state that

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

b) In our opinion proper books of accounts as required by law have been kept by the company, so far as appears from our examination of such books.

c) The Balance Sheet and Profit and Loss Account dealt with by this Report are in agreement with the books of accounts of the Company.

d) In our opinion, the Profit and Loss Account and Balance Sheet comply with the accounting standards referred to in Sub-section (3C) of Section 211 of the Companies Act, 1956.(Except retirement benefits which are accounted for on cash basis.)

e) On the basis of the written representations received from the directors and taken on record by the board of Directors, we report that none of the Directors is disqualified as on March 31, 2009, from being appointed as a Director in terms of clause (g) of sub- section (1) of section 274 of the Companies Act 1956.

f) Attention is invited to the following notes in schedule 18 :

i) Note No. 4 regarding Debts considered doubtful for of recovery amounting to Rs.98,17,159 and Note no - 6 regarding certain advances of Rs 19,25,000/- to contractor for fixed assets for which no provision has been made in accounts

ii) Note No. 5 regarding Non- Provision of retirement benefits.

In our opinion and to the best of our information and according to the explanations given to us , subject to our comments as referred to in (f) above impact of which is presently not ascertainable, the said accounts read with other notes thereon give the information required by the Companies Act, 1956 in the manner so required give true and fair view and conformity with the general accounting principles accepted in India :

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

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

A N D

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

ANNEXURE REFERRED TO THE AUDITORS' REPORT TO THE MEMBERS OF SERVOTECH ENGINEERING IND. LTD. FOR THE YEAR ENDED 31ST MARCH, 2010.

1. a) The Company has maintained proper records showing full particulars, including quantitative

details and situation of fixed assets.

b) As explained to us, the fixed assets have been physically verified by the management during the year. The Company has a phased Program of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assented.

c) Company has advanced a sum of Rs. 19,25,000/- to various suppliers for supply of Machineries and same has been shown under the head Fixed Assets as Capital Work in progress. The suppliers have not yet supplied machineries and in our opinion the said advances are doubtful of recovery. If is informed to us the management is trying to recover the money / or get the machineries. Expect there is no material discrepancies were noticed on such physical verification. No Fixed assets were disposed off during the year.

2. The company has no inventory.

3. The Company has granted unsecured loans & Advanced amounting to Rs.19,60,000/- to The companies, covered in the register maintained under section 301 of the Companies Act, 1956. They are not regular in repayment of principle & interest. This is informed to us the management trying to recover the same. The Company has not taken unsecured loan from company's 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, internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventories, fixed assets and for the sale of goods needs to be strengthened.

5. In our opinion, and according to the information and explanations given to us, the transactions that need to be entered in the register in pursuance of section 301 of the Act have been so entered.

6. The Company has not accepted any deposits from the public and consequently, the directive issued by the Reserve Bank of India, the Provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable.

7. The Company dose not have formal internal audit system.

8. The provisions regarding maintenance of cost records are not applicable to the Company.

9. In Respect of Statutory Dues.

a) The company is not regular in depositing Provident fund with appropriate authorities a sum of Rs. 2,12,966/- on a/c of provident fund is outstanding as on 31st March 2010

b) According to the information and explanations given to us, there are no undisputed amount payable in respect of such statutory due which have remained outstanding as at 31.03.2010 for a period of more than six months from date they become payable Apart from that, a sum of Rs. 2,12,966/- on a/c of provident fund is still outstanding.

c) According to the information and explanations given to us, there are no dues of income tax, Wealth Tax, Sales Tax, Excise duty. Custom Duty & Cess which have not been deposited on account of dispute.

10. The Company has accumulated losses of Rs.3,00,46,559/- at the end of the financial year and has not incurred cash losses during the financial year covered by our audit.

11. The Company has not granted loans and advances 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.

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

13. According to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. Accordingly clause 4(xiv) of the order is not applicable.

14. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions. Accordingly, clause 4(xiv) of the order is not applicable.

15. In our opinion, the company has not taken any term loan during the year.

16. On the basis of an over all examination of the balance sheet of the company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short term basis which have been used for long term investment, and vice versa.

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

18. The Company has not issued any debentures during the year. Accordingly, clause 4(xix) of the order is not applicable.

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

20. During the course of our examination of the books and records of the Company carried out in Accordance with the generally accepted auditing practices in India, and according to the Information and explanations given to us, no fraud on or by the company has been noticed or reported during the audit.

FOR D.C. SURANA & ASSOCIATES

Chartered Accountants

Sd/-

Place : Mumbai (Proprietor)

Date : 3rd September, 2010 M.NO.100-34074

F.R.NO. 115961W