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Auditor Report of Twentyfirst Century Management Services Ltd.

Mar 31, 2016

TO THE MEMBERS OF TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED

Report on the Financial Statements

We have audited the accompanying standalone financial statements of TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED (“the Company”), which comprise the Balance Sheet as at 31st March, 2016 and the Statement of Profit and Loss and the Cash Flow Statement, and a summary of the significant accounting policies and other explanatory information for the year then ended.

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 standalone financial statements that give a true and fair view of the financial position and 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 Companies Act,

2013 read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the preparation 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.

Auditors’ Responsibility

Our responsibility is to express an opinion on these standalone 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. 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 standalone financial statements.

Basis of Opinion

Non Provision of Doubtful Loans & Advances amounting to Rs.2951.16 lacs advanced to its subsidiary company.

We further report that, had the observation made by us above been considered, the loss for the year would have been Rs.2922.55 lacs (as against the reported profit figures of Rs. 28.61 lacs) and loss after considering accumulated figures of previous years would have been Rs. 2361.56 lacs (as against reported figure of profit of Rs. 589.60 Lacs) and the balance of amount due from subsidiary company would have been Rs. Nil (as against the reported figure of Rs. 2951.16 lacs).

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion Paragraph above and Notes to Accounts, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2016,

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order, 2016 (‘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” a statement on the matters specified in paragraphs 3 & 4 of the Order.

2. As required by Section 143(3) of the Act, we 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) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, 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, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this

Report are in agreement with the books of account.

(d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014

(e) The matter described in the basis of qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the company.

(f) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) In our opinion the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in “Annexure B”

(h) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion Paragraph above.

(i) 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 not disclosed the impact of pending litigations on its financial position in its financial statements.

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

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor’s Education and Protection fund by the company.

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

The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the company and the nature of its assets.

2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.

3. The company has granted interest free loans of Rs. 2951.16 lacs to the company listed in the register maintained under section 189 of the Companies Act 2013. But the said Loan advanced to subsidiary company amounting to Rs.2951.16 lacs is doubtful in recovery.

4. During the year under audit, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 in respect of loans, investments, guarantees and security.

5. During the year under audit, the company has not accepted any deposits from the public to which the directives issued by Reserve Bank of India or the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under apply.

6. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 148(1) of the Companies Act, 2013, in respect of any activities carried on by the company.

7. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.

According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31st March 2016 which have not been deposited on account of a dispute pending are as under:

Name of the Statute

AY

Nature of Dispute

Forum where the disputes are pending

Amount

Disputed

Income tax Act, 1961

1995-96

Demand raised subject to rectification by ACIT

ACIT Company Circle III (2)

Rs.4.81 lacs

Income tax Act 1961

1996-97

Rectification by AO raised a demand

Company has to file rectification for the interest working

234B Waiver petition filed by the company. Expecting a relief of Rs 45 lacs

ACIT Company Circle-III(2)

CCIT-I , Chennai

Rs.104.96lacs

Income tax Act, 1961

2003-04

Diminution in the value of stock- Rs. 1289 lacs (value written off)

However there will not be any demand on this issue only carried forward loss will be reduced. However the Carried forward loss will be useful for AY 2007-2008 demand.

Madras High Court

NIL

Income tax Act 1961

2005-06

Assessment was re-opened for third time and order dated 28.03.2013 AO rejected the Excess relief u/s 115JB

BCIT(A) has ordered in ITA No. No.646/2013-14/CIT(A)-11 rejecting the the Jurisdictions and on facts remanded back to AO

CIT(A)-III

Rs. 35.15 lacs

Income tax Act 1961

2006-07

B/F loss not considered, rectification filed

ACIT Company Circle III (2)

Rs.1.33 lacs

Income tax Act, 1961

2007-08

Department has filed appeal before Hon''ble ITAT on the issue of Short Term Capital gains @ 30.99% instead of 15%

Revision order by AO has not considered the Rebate which is pending

The Hon''ble ITAT vide order dated...........

remanded back to Ld CIT(A) to adjudicate the same Ld CIT(a) has remanded back the matter to AO and it is pending with AO

ITAT

Rs.55.45 lacs

Income tax 1961

2007-08

Department issued 148 notice and the assessment got completed

The same issue of STCG @ 30.99 instead of 15%, assessment completed.

Company had filed appeal before Commissioner Appeal-III Further to ITAT remanding back to Ld CIT(A),.

Ld CIT(A) clubbed both the appeals and since the issue is common and had remanded the matter to AO on the issue on whether sale of shares is Business or Capital gains

CIT-Appeal -III

Rs 68.69 lacs

Income tax Act 1961

2010-11

The Assessment was reopened u/s 148 on the issue of Client Modification code

The Company has filed appeal against the order.

ACIT Corporate Circle-3(1), Chennai

Rs 4.57lacs

8. On the basis of records examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

9. According to the information and explanations given to us, the company has not raised any moneys by way of initial public offer or further public offer or any term loans during the year under review

10. To the best of our knowledge and belief and according to the information and explanations given to us we have not come across any fraud by the company or any fraud on the Company by its officers or employees during the course of our audit of the period under review.

11. During the year under audit, the company has not paid any managerial remuneration. Thus paragraph 3(xi) of the order is not applicable to the company.

12. In our opinion and according to information and explanations given to us, the company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the order is not applicable.

13. According to the information and explanations given to us and the records examined by us, the transaction with the related parties are in compliance with the provisions of section 177 and section 188 of the Companies Act, 2013 and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14. According to the information and explanations given to us and the records examined by us, the company has not made any preferential allotment and private placement of shares during the year. Accordingly, paragraph 3(xiv) of the order is not applicable.

15. According to the information and explanations given to us and the records examined by us, the company has not entered into noncash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the order is not applicable.

16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

Report on the Internal Financial Controls under clause (i) of sub-section 3 of section 143 of the companies act, 2013 (“the act”)

We have audited the internal financial controls over financial reporting of TWENTYFIRST CENTURY

MANAGEMENT SERVICES LIMITED (“the Company”) as of 31st March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For Lakhani & Lakhani

Chartered Accountants

Firm Registration No. 115728W

Suhas Shinde

Partner

Membership No. 117107

Place: Mumbai

Date: 19-05-2016


Mar 31, 2015

Report on the Financial Statements

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

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 standalone financial statements that give a true and fair view of the financial position and 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, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the preparation 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.

Auditors'' Responsibility Our responsibility is to express an opinion on these standalone 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. 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 standalone financial statements.

Basis of Opinion

Non Provision of Doubtful Loans & Advances amounting to Rs. 2272.22 lacs advanced to its subsidiary company.

We further report that, had the observation made by us above been considered, the profit for the year would have been Rs. 217.28 lacs (as against the reported profit figures of Rs. 2489.50 lacs) and profit after considering accumulated loss of previous years would have been Rs. 33.33 lacs (as against reported figure of profit of Rs. 2305.55 Lacs) and the balance of amount due from subsidiary company would have been Rs. Nil (as against the reported figure of Rs. 2272.22 lacs).

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion Paragraph above and Notes to Accounts, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(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 profit of the Company for the year ended on that date

(c) in the case of the Cash Flow Statement, of the cash flows of the Company 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 (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 & 4 of the Order.

2. As required by Section 143(3) of the Act, we 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) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, 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, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014

(e) The matter described in the basis of qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the company.

(f) On the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors,

none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) In our opinion the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls are adequate.

(h) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion Paragraph above.

(i) 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 not disclosed the impact of pending litigations of Income Tax Act 1961 on its financial position in its financial statements.

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

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor''s Education and Protection Fund by the company.

ANNEXURE TO THE AUDITOR’S REPORT

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

The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the company and the nature of its assets.

2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.

3. The company has granted interest free loans of Rs. 2272.22 lacs to the company listed in the register maintained under section 189 of the Companies Act 2013. But the said Loan advanced to subsidiary company amounting to Rs.2272.22 lacs is doubtful in recovery.

4. 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 for the purchase of fixed assets and Sale of services. The nature of the Company''s activities is such that it does not involve purchase of inventories and sale of goods. During the course of our audit, we have not observed any major weaknesses in the internal control system of the Company and hence, the question of any continuing failure to correct the same does not arise.

5. During the year under audit, the company has not accepted any deposits from the public to which the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under apply.

6. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 148(1) of the Companies Act, 2013, in respect of any activities carried on by the company.

7. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.

According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31 st March 2015 which have not been deposited on account of a dispute pending are as under:

Name AY Nature Forum where Amount of the of the disputes Disputed Statute Dispute are pending

Income 1995 - Demand raised ACIT Company Rs.4.81 tax Act, 96 subject to recti- Circle III (2) lacs 1961 fication by ACIT

Income 1996 - Rectification by ACIT Company Rs. 104.96 tax Act, 97 AO raised a Circle III (2) lacs 1961 demand Company has to file rectification for the interest working 234B waiver CCIT- I, Chennai petition filed by the company, Expecting a relief of Rs. 45 lacs

Income 2003 - Diminution in the Madras High Nil tax Act, 04 value of stock Rs. Court 1961 1289 Lacs (Value written off)

However there will not be any demand on this issue only carried forward loss will be reduced.

However the Carried forward loss will be useful for AY 2007-2008 demand.

Income 2005 - Assessment was CIT(A) III Rs. 35.15 tax Act, 06 re-opened for third lacs 1961 time and order dated 28.03.2013 AO rejected the Excess relief u/s 115 JB Jurisdiction is questioned

Income 2006 - B/F loss not ACIT Company Rs. 1.33 tax Act, 07 c onsidered, Circle III (2) lacs 1961 rectification filed

Name AY Nature Forum where Amount of the of the disputes Disputed Statute Dispute are pending

Income 2007 - Department has ITAT Rs.55.45 tax Act, 08 filed appeal before lacs 1961 Hon''ble ITAT on the issue of Short Term Capital gains @30.99% instead of 15% . Revision order by AO has not consid- ered the Rebate which is pending. Income 2007 - Department issued CIT- Rs.68.69 tax Act, 08 148 notice and the Appeal III lacs 1961 assessment got completed The same issue of STCG @30.99% instead of 15% assessment completed. Company had filed appeal before Commissioner Appeal - III

Income 2009 - No demand,However penalty 1961 CIT Nil tax Act, 10 has been initiated for Appeal III addition u/s 14A As penalty initiated the company has filed Appeal before Commissioner Appeal III it is pending

Income 2010 - Credit for Self ACIT Rs. tax Act, 11 Assessment Tax1961 of Company 13.28 Rs. 7.02 Lacshas not Circle lacs been given,rectification III (2) field

Income 2011 - Intimation u/s ACIT tax Act, 12 143 (1) wrongly 1961 passed, Company Rs. Rectification filed and it Circle 830.20 is pending III (2) lacs

8. The company has accumulated loss of Rs. 183.95 lacs till the immediately preceding financial year but has earned profit of Rs. 2489.50 lacs during the current financial year under this report which writes off the accumulated loss of the company.

9. On the basis of records examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

10. According to the information and explanations given to us the company has not given any guarantee for the loans taken by others from banks or financial institutions.

11. According to the information and explanations given to us, the company has not obtained any term loans during the year under review.

21. To the best of our knowledge and belief and according to the information and explanations given to us, fraud in the nature of misappropriation of uncleared demand draft of Rs. 61.20 lakhs by an official of the company, which was lying with his custody, has been noticed and reported during the course of our audit.

For Lakhani & Lakhani Chartered Accountants (Firm Registration No.115728W)

Suhas Shinde (M.No. 117107) Partner

Place: Mumbai Date : 16-05-2015


Mar 31, 2014

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

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 and financial performance of the Company in accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles 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 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 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 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 Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the 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

a. Non provision for Gratuity has been made in accounts, in the event of any employee leaving the services by reason of death / incapability / retirement or resignation. Amount not ascertained.

b. Non Provision of Doubtful Loans & Advances amounting to Rs. 2134.90 lacs advanced to its subsidiary company.

We further report that, had the observation made by us in point (b) of Para above been considered, the loss for the year would have been Rs. 2160.55 lacs (as against the reported loss figures of Rs. 25.65 lacs) and accumulated loss would have been Rs.2318.85 Lacs (as against reported figure of accumulated Loss of Rs. 183.95 Lacs) and the balance of amount due from subsidiary company would have been Rs. Nil (as against the reported figure of Rs. 2134.90 lacs),

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the above paragraph, 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 Balance Sheet, of the state of affairs of the Company as at 31st March 2014

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

c) in the case of the Cash Flow Statement, of the cash flows of the Company 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 ("th eOrder") issued by the Central Government of India in terms of Section 227 (4A) of the Act, we give in the Annexure a statement on the matters specified in paragraph 4 & 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 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 and the 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 and the Statement of Profit & Loss comply with the Accounting Standards referred to in Section 211(3C) of the Act,

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

ANNEXURE TO THE AUDITOR''S REPORT

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

The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the Company and the nature of its assets.

As per the information and explanations given to us, during the year, the company has not disposed off any substantial part of the fixed assets that would affect the going concern.

2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.

3. The company has taken interest free loans of Rs. 5.50 Lacs from companies or firms listed in the register maintained under section 301 of the Companies Act 1956 and from company under the same management. The company has granted interest free loans of Rs. 2152.76 lacs to the companies listed in the register maintained under section 301 of the Companies Act 1956. In our opinion the terms & conditions of said loan is not prima facie prejudicial to the Interest of the Company. In our opinion the terms & conditions of said loan is not prima facie prejudicial to the Interest of the Company. But the Loan advanced to subsidiary company amounting to Rs. 2134.90 Lacs is doubtful in recovery.

4. The Company has adequate internal control procedures commensurate with its size and nature of business with regard to purchase of shares, fixed assets and for the sale of shares, assets or equipments. We have not observed any continuing failure to correct such internal control systems.

5. The transactions that are required to be entered into the register in pursuance of Section 301 of the act have been so entered.

In our opinion and according the information and explanations given to us the transactions made in pursuance of contracts or arrangements entered in the register maintained u/s 301 of the Companies Act 1956 and exceeding the value of Rs.5 Lacs in respect of any party during the year have been made at prices which are reasonable, having regard to prevailing market prices at the relevant time where such market prices are available.

6. During the year under review, the company has not accepted any deposits from the public to which the provisions of Section 58A of the Companies Act, 1956 apply.

7. Company does not have any internal audit department, commensurate with the size of the company and nature of its business.

8. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956, in respect of any activities carried on by the Company.

9. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.

According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31st March 2014 which have not been deposited on account of a dispute pending are as under:

Name AY Nature Forum where Amount of the of the disputes Disputed Statute Dispute are pending

Income 1995 - Demand raised ACIT Company Rs.4.81 tax Act, 96 Subject to recti- Circle III (2) lacs 1961 fication by ACIT

Income 1996 - Rectification by ACIT Company Rs. 104.96 tax Act, 97 AO raised a Circle III (2) lacs 1961 demand

Company has to file rectification for the interest working

34B waiver CCIT- I, Chennai Petition filed by he company, Expecting a relief of Rs. 45 lacs

Income 2003 - Diminution in the Madras High Nil tax Act, 04 Value of stock Rs. Court 1961 1289 Lacs (Value Written off)

However there will ot be any demand n this issue only arrived forward loss Will be reduced. However the arrived forward oss will be useful or AY 2007-2008 demand.

Income 2005 - Assessment was CIT(A) III Rs. 35.15 tax Act, 06 re-opened for third lacs

1961 Time and order dated 28.03.2013 AO rejected the Excess relief u/s 115 JB

Jurisdiction is Questioned

Income 2006 - B/F loss not ACIT Company Rs. 1.33 tax Act, 07 Considered, Circle III (2) lacs 1961 rectification filed

Name of Statute AY Nature Forum Where Amount Income of Dispute the disputes Disputed

Income tax Act, 1961 2007 - Department has ITAT Rs.55.45 08 filed appeal before Lacs Hon''ble ITAT on the issue of Short Term Capital gains @ 30.99% instead of 15% .

Revision order by AO has not consid -ered the Rebate Which is pending.

Income 2007 - Department issued CIT-Appeal III Rs.68.69 tax Act, 08 148 notice and the lacs 1961 assessment got Completed

The same issue o STCG @30.99% ] instead of 15% assessment Completed.

Company had filed appeal before Commissioner Appeal - III

Income 2009 - No demand, CIT Appeal III Nil tax Act, 10 However penalty 1961 as been initiated for addition u/s 14A

As penalty initiated the company has filed Appeal before Commissioner Appeal III it is Pending

Income 2010 - Credit for Self CIT Company Rs. 13.28 tax Act, 11 Assessment Tax Circle III (2) lacs 1961 of Rs. 7.02 Lacs has not been given, rectification field

Income 2011 - Intimation u/s CIT Company Rs. 830.20 tax Act, 12 143 (1) wrongly Circle III (2) lacs 1961 Passed, Credit for Self Assessment Tax of Rs.182.04 Lacs has not been given, Rectification yet to be field

10. The company has accumulated loss of Rs. 158.30 lacs till the immediately preceding financial year, has incurred a loss of Rs. 25.65 lacs during the current financial year under this report.

11. On the basis of records examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

12. 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 Fund/Society. Therefore the provisions of clause 4 (xiii) of the companies (Auditor''s Report) Order, 2003 are not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in shares, debentures and other investments and timely entries have been made therein.

15. According to the information and explanations given to us the company has not given any guarantee for the loans taken by others from banks or financial institutions.

16. According to the information and explanations given to us, the company has not obtained any term loans during the year under review.

17. On the basis of an overall examination of the balance sheet of the company, in our opinion and according to the information and explanations given to us, funds raised on short term basis, have not been used for long term investments.

18. The company has not made any preferential allotment of shares during the year.

19. There are no secured debentures issued during the year.

20. The company has not raised any money by public issue during the year.

21. To the best of our knowledge and belief and according to the information and explanations given to us no material fraud on or by the company has been noticed or reported during the course of our audit.

For Lakhani & Lakhani

Chartered Accountants

(Firm Registration No.115728W)

Suhas Shinde (M.No. 117107)

Partner

Place: Mumbai

Date : 16-05-2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED ("the Company"), which comprise the Balance Sheet as 31st March, 2013 and the Statement of Profit and Loss for the year then ended, and a summary of at the significant accounting policies and other explanatory information.

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 and financial performance of the Company in accordance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles 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 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 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 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 Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the 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 Company has not made any provision of Rs. 789.21 lacs being shortfall in the market value of quoted investment as on 31.03.2013, because in the opinion of the management, the shortfall is temporary in nature and investment is held for long term period.

The Financial statements are subject to Non Provision of Shortfall in the value of investments amounting to Rs. 789.21 lacs,

We further report that, had the observation made by us in Para above been considered, the loss for the year would have been Rs. 1013.34 lacs (as against the reported loss figures of Rs. 224.13 lacs) and accumulated loss would have been Rs.947.51 Lacs (as against reported figure of accumulated Loss of Rs. 158.30 Lacs) and the balance of quoted investments would have been Rs. 636.15 lacs (as against the reported figure of Rs. 1425.36 lacs),

The aforesaid financial statements give the information required by the Companies 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 Balance Sheet, of the state of affairs of the Company as at 31st March 2013 and

b) In the case of Profit & Loss Account, of the Loss of the company 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 (th order") issued by the Central Government of India in terms of Section 227 (4A) of the Act, we give in the Annexure a statement on the matters specified in paragraph 4 & 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 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 appears from our examination of those books.

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

(d) In our opinion the Balance Sheet and the Statement of Profit & Loss comply with the Accounting Standards referred to in Section 211 (3C) of the Act, subject to:

Note 2(h), in respect of non provision for Employees Benefit has been made in accounts, in the event of any employee leaving the services by reason of death / incapability / retirement or resignation. Amount not ascertained.

(e) On the basis of the written representations received from the directors, as on 31s'' 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 section 274(1 )(g) of the Act.

ANNEXURE TO THE AUDITOR''S REPORT

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

The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the Company and the nature of its assets.

As per the information and explanations given to us, during the year, the company has not disposed off any substantial part of the fixed assets that would affect the going concern.

2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.

3. The company has taken interest free loans from companies or firms listed in the register maintained under section 301 of the company''s act 1956 and from company under the same management. The company has granted interest free loans of Rs. 1955.83 lacs to its subsidiary company listed in the register maintained under section 301 of the companies act, 1956 and from companies under the same management.

4. The Company has adequate internal control procedures commensurate with its size and nature of business with regard to purchase of shares, fixed assets and for the sale of shares, assets or equipments. We have not observed any continuing failure to correct such internal control systems.

5. The transactions that are required to be entered into the register in pursuance of Section 301 of the act have been so entered.

In our opinion and according the information and explanations given to us the transactions made in pursuance of contracts or arrangements entered in the register maintained u/s 301 of the companies act 1956 and exceeding the value of Rs.5 Lacs in respect of any party during the year have been made at prices which are reasonable, having regard to prevailing market prices at the relevant time where such market prices are available.

6. During the year under review, the company has not accepted any deposits from the public to which the provisions of Section 58A of the Companies Act, 1956 apply.

7. Company does not have any internal audit department, commensurate with the size of the company and nature of its business.

8. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956, in respect of any activities carried on by the Company.

9. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.

According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31s March 2013 which have not been deposited on account of a dispute pending are as under:

Name AY Nature Forum where Amount of the of the disputes Disputed Statute Dispute are pending

Income 1995- Demand raised ACII Company Rs.4.81 tax Act, 96 subject to recti- Circle III (2) lacs 1961 fication by ACIT

Income 1996- Rectification by ACIT Company Rs. 104.96 tax Act, 97 AO raised a Circle III (2) lacs 1961 demand Company has to file rectification for the interest working

234B waiver CCITI, Chennai petition filed by the company, Expecting a relief of Rs. 45 lacs

Income 2005- Assessment was CIT(A) III Rs. 35.15 tax Act, 06 re-opened for lacs 1961 third time and order dated 28.03.2013 AO rejected the Excess relief u/s 115 JB

Jurisdiction is questioned

Income 2006- B/F loss not ACIIT Company Rs. 1.33 tax Act, 07 considered, Circle III (2) lacs 1961 rectification filed

Income 2007- Department has ITAT Rs.55.45 tax Act, 08 filed appeal lacs 1961 before Homble ITAT on the issue of Short Term Capital gains @ 30.99% instead of 15% company.

Revision order by AO has not considered the Rebate which is pending.

Income 2010- Credit for Self ACII Company Rs. 13.28 tax Act, 11 Assessment Tax Circle III (2) lacs 1961 of Rs. 7.02 Lacs has not been given, rectification field

Income 2011- Intimation u/s ACII Company Rs. 830.20 tax Act, 12 143 (1) wrongly Circle III (2) lacs 1961 passed, Credit for Self Assessment Tax of Rs.182.04 Lacs has not been given, Rectification yet to be field

10. The company has accumulated loss of Rs. 133.57 lacs till the immediately preceding financial year, has incurred a loss of Rs. 224.13 lacs during the current financial year under this report.

11. On the basis of records examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

12. 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 Fund/Society. Therefore the provisions of clause 4 (xiii) of the companies (Auditor''s Report) Order, 2003 are not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in shares, debentures and other investments and timely entries have been made therein.

15. According to the information and explanations given to us the company has not given any guarantee for the loans taken by others from banks or financial institutions.

16. According to the information and explanations given to us the company has not obtained any term loans during the year under review.

17. On the basis of an overall examination of the balance sheet of the company, in our opinion and according to the information and explanations given to us, funds raised on short term basis, have not been used for long term investments.

18. The company has not made any preferential allotment of shares during the year.

19. There are no secured debentures issued during the year.

20. The company has not raised any money by public issue during the year.

21. To the best of our knowledge and belief and according to the information and explanations given to us no material fraud on or by the company has been noticed or reported during the course of our audit.

For M.B. Ladha & Company

Chartered Accountants

(Firm Registration No.105503W)

Mukesh Ladha (M.No.35544)

Proprietor

Place: Mumbai

Date : 30-05-2013


Mar 31, 2012

We have audited the attached Balance Sheet of Twentyfirst Century Management Services Limited for the year ended 31st March 2012 and also the Profit & Loss Account for the year ended on that date, annexed thereto. These financial statements are 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 (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Sub section (4A) of Sec. 227 of the Companies Act 1956, we enclose in the annexure a statement on the matters specified in paragraph 4 & 5 of the said Order to the extent applicable.

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, the Company has kept proper books of account as required by law so far as appears from our examination of the books.

(iii) In our opinion the Balance Sheet and Profit & Loss Account comply with the accounting standards referred to in Sub section (3C) of Section 211 of the Companies Act, 1956, subject to:

Note 2(h), in respect of no provision for gratuity has been made in accounts, in the event of any employee leaving the services by reason of death / incapability / retirement or resignation.

Note 13, in respect of non provision of sundry debtors amounting to Rs. 2307.13 lacs transferred from subsidiary company which are considered good by the management.

Note 14(3), in respect of inoperative bank accounts amounting to Rs. 1.53 lacs, no confirmation is received and the accounts are neither closed nor written off.

(iv) We further report that, had the observation made by us in Para above, been considered, the loss for the year would have been Rs. 3072.25 lacs (as against reported loss of Rs.763.59 lacs) and accumulated loss would have been Rs. 2442.23 lacs (as against reported accumulated loss of Rs. 133.57 lacs) and sundry debtors would have been Nil (as against reported sundry debtors of Rs. 2307.13 lacs) and Cash and Bank balance would have been Rs. 14.83 lacs (as against reported Cash and Bank balance of Rs. 16.36 lacs)

(v) The Balance Sheet and Profit & Loss A/c dealt with by this report are in agreement with the books of account.

(vi) On the basis of written representations received from the directors, as on 31s March 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31s 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.

(vii) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements, read together with the notes thereon, give the information required by the Companies Act, 1956, in the manner so required and present a true and fair view, Subject to Para (iii) and (iv) above in conformity with the accounting principles generally accepted in India:

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

b) In the case of Profit & Loss Account, of the Loss of the company 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.

ANNEXURE TO THE AUDITOR''S REPORT

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

The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the Company and the nature of its assets.

As per the information and explanations given to us, during the year, the company has not disposed off any substantial part of the fixed assets that would affect the going concern.

2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.

3. The company has not taken any loans from companies or firms listed in the register maintained under section 301 of the company''s act 1956 and from company under the same management. The company has not given any loan to companies or firms listed in the register maintained under section 301 of the companies act, 1956 and from companies under the same management.

4. The Company has adequate internal control procedures commensurate with its size and nature of business with regard to purchase of shares, fixed assets and for the sale of shares, assets or equipments. We have not observed any continuing failure to correct such internal control systems.

5. The transactions that are required to be entered into the register in pursuance of Section 301 of the act have been so entered.

In our opinion and according the information and explanations given to us the transactions made in pursuance of contracts or arrangements entered in the register maintained u/s 301 of the companies act 1956 and exceeding the value of Rs.5 Lacs in respect of any party during the year have been made at prices which are reasonable, having regard to prevailing market prices at the relevant time where such market prices are available.

6. During the year under review, the company has not accepted any deposits from the public to which the provisions of Section 58A of the Companies Act, 1956 apply.

7. Company does not have any internal audit department, commensurate with the size of the company and nature of its business.

8. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956, in respect of any activities carried on by the Company.

9. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.

According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31s March 2012 which have not been deposited on account of a dispute pending are as under:

Name AY Nature Forum where Amount of the of the disputes Disputed Statute Dispute are pending

Income 1995- Demand raised ACII Company Rs.20.20 tax Act, 96 subject to recti- Circle III (2) lacs 1961 fication by ACIT

Income 2003- Diminution in the Madras High Rs.1289 tax Act, 04 value of stock Court lacs 1961 (Value written off)

Income 2006- Department has Commissioner Rs.562.33 tax Act, 07 disallowed the of Appeals-III, lacs 1961 Carrry forward Chennai-34. Loss related to The Appeal has AY 1998-99, been made 2003-04. The against 143(1) company had of the Income claimed the tax Act Carry forward loss related to AY 2003-04, as the matter is pending before Hon''ble Madras High court

Income 2007- Department has Commissioner Rs.598.14 tax Act, 08 raised demand of Appeals-III, lacs 1961 on Short Term Chennai-34. Capital gains @ The Appeal is 30.99% instead made against of 15% company the order u/s had claimed the 154 of the Carry forward Income tax Act loss related to AY 2003-04, as the matter is pending before Hon''ble Madras High court

10. The company has no accumulated losses till the immediately preceding financial year, but has incurred a losses of Rs. 763.59 Lacs during the current financial year under this report.

11. On the basis of records examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

12. 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 Fund/Society. Therefore the provisions of clause 4 (xiii) of the companies (Auditor''s Report) Order, 2003 are not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in shares, debentures and other investments and timely entries have been made therein.

15. The company has given corporate guarantee of Rs. 287.50 lacs for the credit facilities availed by its subsidiary. According to the information and explanations given by the management, in our opinion the terms and conditions of the guarantee given for loans are not prejudicial to the interest of the Company.

16. According to the information and explanations given to us, the company has not obtained any term loans during the year under review.

17. On the basis of an overall examination of the balance sheet of the company, in our opinion and according to the information and explanations given to us, funds raised on short term basis, have not been used for long term investments.

18. The company has not made any preferential allotment of shares during the year.

19. There are no secured debentures issued during the year.

20. The company has not raised any money by public issue during the year.

21. To the best of our knowledge and belief and according to the information and explanations given to us no material fraud on or by the company has been noticed or reported during the course of our audit.

For M.B. Ladha & Company

Chartered Accountants

(FRN: 105503W)

Mukesh Ladha (M.No.35544)

Proprietor

Place: Mumbai

Date: 30-05-2012


Mar 31, 2010

We have audited the attached Balance Sheet of TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED for the year ended 31st March 2010 and also the Profit & Loss Account for the year ended on that date, annexed thereto. These financial statements are responsibility of the Companys 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 (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Subsection (4A) of Sec. 227 of the Companies Act 1956, we enclose in the annexure a statement on the matters specified in paragraph 4 & 5 of the said Order to the extent applicable.

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, the Company has kept proper books of account as required by law so far as appears from our examination of the books.

(iii) In our opinion the Balance Sheet and Profit & Loss Account comply with the accounting standards referred to in Sub section (3C) of Section 211 of the Companies Act, 1956, subject to note no. 1 (b) of schedule - J in respect of no provision for gratuity and leave encashment.

(iv) The Balance Sheet and Profit & Loss A/c dealt with by this report are in agreement with the books of account.

(v) On the basis of written representations received from the directors, as on 31s March 2010 and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31s March, 2010 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 financial statements, read together with the notes thereon, give the information required by the Companies Act, 1956, in the manner so required and present a true and fair view in conformity with the accounting principles generally accepted in India:

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

b) In the case of Profit & Loss Account, of the Profit of the company 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.

ANNEXURE TO THE AUDITORS REPORT

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

The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the Company and the nature of its assets.

No substantial part of the fixed assets has been disposed off by the company during the year.

2. The stock of shares of the company held in physical form has been physically verified during the year by the Management. In our opinion, having regard to the nature and location of stock, the frequency of verification is reasonable. Most of the shares are held in dematerialsed form.

In our opinion and according to the information and explanation 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 nature of its business.

In our opinion and according to the information and explanation given to us, the company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stock and the book records were not material.

3. The Company has taken loan from Companies or firms listed in the register maintained under section 301 of the Companys Act 1956 and from Company under the same management. The maximum balance and the year end balance is Rs. 5,50,000/-. The company has not given any loan to Companies or firms listed in the register maintained under section 301 of the Companies Act 1956 and from company under the same management.

4. The Company has adequate internal control procedures commensurate with its size and nature of business with regard to purchase of shares, fixed assets and for the sale of shares, assets or equipments. We have not observed any continuing failure to correct such internal control systems.

5. The transaction that are required to be entered into the register in pursuance of Section 301 of the act have been so entered.

In our opinion and according the information and explanation given to us the transactions made in pursuance of contracts or arrangements entered in the register maintained u/s 301 of the companies act 1956 and exceeding the value of Rs.5 Lacs in respect of any party during the year have been made at prices which are reasonable, having regard to prevailing market prices at the relevant time where such market prices are available.

6. During the year under review, the company has not accepted any deposits from the public to which the provisions of Section 58A of the Companies Act, 1956 are applicable.

7. The Company is not a manufacturing company and does not have any scrap or by product.

8. In our opinion, the Company has an adequate internal audit system commensurate with the size of the company and nature of its business.

9. We have been informed that Central Government has not prescribed the maintenance of Cost Records under Section 209(1 )(d) of the Companies Act, 1956, for any product of the Company. J

10. According to the information and explanations given to us, the company been regular in depositing Employees Provident Fund dues and has been also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.

No undisputed amount payable in respect of income tax, cess and other material statutory dues, are in arrears as at 31st March, 2010 for period exceeding six months except in respect of assessment year 2003-04, the Company has a disputed tax liability arising out of addition of Rs. 1,292.48 Lakhs made by the Income-tax Officer and the matter is pending before the Honble High Court of Madras. No provision towards tax liability is considered necessary as this addition, which is disputed, has not resulted in any additional tax liability and the Company has been advised about favourable decisions.

11. The company has accumulated losses of Rs. 282.92 Lakhs till the immediately proceeding financial year and has not incurred any loss during the current financial year under this report.

12. On the basis of records examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

13. The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Therefore the provisions of clause 4 (xii) of the companies (Auditors Report) Ordered, 2003 are not applicable to the company.

14. In our opinion the company is not a Chit Fund or a Nidhi/Mutual Fund/Society. Therefore the provisions of clause 4 (xiii) of the companies (Auditors Report) Ordered, 2003 are not applicable to the company.

15. The Company is dealing in shares and proper records have been maintained for the transactions and contracts & timely entries have been made therein & the shares have been held by the Company in its own name.

16. According to the information and explanations given to us the company has not given any guarantee for loans taken by others from banks or financial institutions.

17. According to the information and explanations given to us, the Company has not obtained any term loans during the year under review.

18. According to the information and explanations given to us no preferential allotment of shares to parties and companies covered in the register maintained u/s 301 of the Companies Act, 1956 has been made during the period covered by our audit report.

19. According to the information and explanations given to us the company has not issued any debentures during the year hence creation of security is not applicable.

20. During the period covered by our audit report, the company has not raised any money by public issue.

21. To the best of our knowledge and belief and according to the information and explanations given to us no material fraud on or by the company has been noticed or reported during the course of our audit.

ForShankar & Kishor Chartered Accountants

S. B. Shetty(M.No.38139) Partner

Place: Mumbai Date: 24-05-2010

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