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Auditor Report of Universal Arts Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of UNIVERSAL ARTS LIMITED(Formerly Known as Goldmines Media Limited)("the Company"), which comprise the Balance Sheet as at March 31st, 2015, and the Statement of Profit and Loss for the period 1st July, 2014 till year then ended, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS.

Management and Board of Directors of the Company are 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 Companies (Accounts) Rules, 2014. This responsibility includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; design, implementation and maintenance of adequate internal financial controls, that are operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITOR'S RESPONSIBILITY.

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

In Our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at 31st March 2015,itsProfitand its Cash Flow for the period 1st July, 2014 ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor's Report) Order, 2015 ('the Order') issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

a) We have sought 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 and 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 Statement of Profit and Loss comply with the Accounting Standards referred to in Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules 2014;

e) On the basis of written representations received from the directors as on March 31, 2015, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of sub section (2) of Section 164 of the Act.

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

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

ii. The Company did not have any long-term contracts including derivative contracts; 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 Company 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 TO THE AUDITORS' REPORT (Period 1st July 2014 to 31st March 2015)

(REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE)

As required by the Companies (Auditor's report) Order, 2015, issued by the Central Government of India in terms of Sub-section (11) of section 143 of the Companies Act, 2013 and on the basis of such check as were considered appropriate and according to the information and explanation and representation given to us, we report:

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

b) As explained to us, fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

The Company's inventory consists of intangible rights of movies.

a) & b) The said Intangible rights cannot be physically verified but the documents creating rights in the said Intangible rights are available.

c) The Company is maintaining proper records of the inventory.

i. The Company has not taken loans from parties listed in register maintained u/s 189 of the Companies Act, 2013.

The Company has granted loans and advances to companies, firms or other parties as listed in the register maintained under section 189 of the companies Act, 2013. The year-end balance of loans and advances given to such parties was Rs62,10,000 Maximum Outstanding was Rs63,10,000.

ii. There are adequate internal control procedures commensurate with the size of the Company and the nature of its business, being buying and selling of film rights. To the best of our knowledge, no major weaknesses in internal control system were either reported or noticed by us during the course of our audit.

iii. According to the information & explanations provided to us, the company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of Section 73 to 76 of the Companies Act, 2013 and other relevant provisions of the Companies Act, 2013 and the rules framed there under apply.

iv. We have been informed that the central government has not prescribed for the maintenance of cost records under sub-section (1) of section 148 of the Companies Act, 2013.

v. (a) According to the records of the company, undisputed statutory dues including Income-tax, Sales-tax, Wealth Tax, Service Tax and entry tax to the extent applicable and any other statutory dues have been regularly deposited with the appropriate authorities. According to the information and explanations given to us there were no outstanding statutory dues as on 31st of March, 2015 for a period of more than six months from the date they became payable.

(b) We have been informed that no undisputed amount payable in respect of Income tax, Wealth tax, Sales tax, Customs duty, Excise duty and Service tax were outstanding as at 31st March, 2015 for a period of more than six months from the date they became payable. We have been informed that the provisions of the Investor Education and Protection Fund, Employees State Insurance Act, Sales Tax, Custom Duty and Excise Duty are not applicable to the Company for the period 1st July 2014 to 31st March 2015.

vi. The Company has accumulated losses at the end of the financial year which does not exceed 50% of it's net worth. Also, the Company has not incurred cash losses during the financial period 1st July 2014 and ended on March 31, 2015.

vii. The Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders.

viii. According to information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the period 1st July 2014 to 31st March 2015.

ix. The Company has not availed any term loans during the period 1st July 2014 to 31st March 2015.

x. Based on the audit procedure performed and the representation obtained from the management, we report that in no case fraud on or by the company has been noticed or reported during the period 1st July 2014 to 31st March 2015.

For SekhriKanodia& Associates Chartered Accountants, Firm No. 109389w

Sd/- Ajay Sekhri- Partner Membership No. 032103

Place: - Mumbai Date: -30/05/2015


Jun 30, 2013

REPORT ON FINANCIAL STATEMENTS

We have audited the accompanying financial statements of UNIVERSAL ARTS LIMITED (Formerly Known as Goldmines Media Limited)("the Company"), which comprise the Balance Sheet as at June 30, 2013, and the Statement of Profit and Loss for the year then ended, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS.

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

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

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

OPINION

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

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 30th June, 2013 and;

(ii) In the case of the Statement of Profit and Loss account, of the Loss of the Company for the year ended on that date.

(iii) In so far as it relates to Cash Flow Statement, of the Cash Flow for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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

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

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

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

c) The Balance Sheet and 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 Statement of Profit and Loss comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on June 30, 2013, none of the directors is disqualified as on June 30, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

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

ANNEXURE TO THE AUDITORS'' REPORT

(REFFERED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE )

As required by the Companies (Auditor''s report) Order, 2003, issued by the Central Government of India in terms of Sub-section (4A) of section 227 of the Companies Act, 1956 and on the basis of such check as were considered appropriate and according to the information and explanation and representation given to us, we report:

1. a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.

b) The management has physically verified most of the fixed assets at the year end. No material discrepancies were noticed on such verification.

c) There is no disposal of fixed assets during the year.

2. The Company''s inventory consists of intangible rights of movies and proper records of the same have been maintained by the management. Further, physical verification of said intangible rights is not possible.

3. The Company has not taken loans from parties listed in register maintained u/s 301 of the Companies Act, 1956. The Company has granted loans to companies, firms or other parties as listed in the register maintained under section 301 of the companies Act, 1956. The year-end balance of loan given to suchparties was Rs.38.10 lakhs.

4. There are adequate internal control procedures commensurate with the size of the Company and the nature of its business, being buying and selling of film rights. To the best of our knowledge, no major weaknesses in internal control were either reported or noticed by us during the course of our audit.

5. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered into in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

In our opinion and according to the information and explanations given to us, the transactions in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding Rs. 5,00,000/- (Rupees Five Lacs Only) in respect of any party during the year have been made at price, which are reasonable having regard to prevailing market price at the relevant time.

6. The Company has not accepted any deposit from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) rules 1975.

7. There is no formal internal audit system. However, according to the information and explanations provided to us, operating control systems are commensurate with the size of the Company and the nature of its business.

8. We have been informed that the Central Government has not prescribed for the maintenance of cost records under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956.

9. According to the records of the Company, the Company has been generally regular in depositing undisputed statutory due with the appropriate authorities. There were no undisputed amounts payable in respect of Income-tax, Wealth-tax, Sales-tax, Customs duty and Excise duty, which were outstanding as at the balance sheet date for a period of more than six months from the date they became payable.

There are no disputed dues which have remained unpaid as on 30th June, 2013 in respect of sales tax, income tax, custom duty, wealth tax, excise duty, cess.

10. The Company has accumulated losses at the end of the financial year which does not exceed 50% of the its net worth. Also, the Company has incurred cash losses during the financial year covered by our audit.

11. The Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders.

12. The Company has not granted any loans and advances on the basis of security during the year.

13. In our opinion, the provision of special statute applicable to Chit Fund, Nidhi or mutual benefit society is not applicable to the Company.

14. In our opinion, proper records have been maintained of the transactions and contracts relating to dealing in the shares and timely entries have been made therein.

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

16. During the year, company has not taken any term loans.

17. On the basis of overall examination of the balance sheet, we report that the funds raised on short-term basis have not been used for long-term investments and vice versa.

18. During the year, the Company had not made any preferential allotment of shares to parties and companies covered in the register maintained u/s. 301 of the Companies Act, 1956.

19. The Company has not issued debentures during the year and hence, the question of creating securities in respect thereof does not arise.

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

21. Based on the audit procedure performed and the representation obtained from the management, we report that in no case fraud on or by the company has been noticed or reported during the year under audit.

FOR SEKHRI KANODIA & ASSOCIATES

CHARTERED ACCOUNTANTS,

Sd/-

AJAY SEKHRI-

PARTNER

MEMBERSHIP NO. 032103

FIRM NO. 109389W

PLACE : MUMBAI

DATE : 28.08.2013


Jun 30, 2012

1. We have audited the attached Balance Sheet of UNIVERSAL ARTS LIMITED (Formerly Known as Goldmines Media Limited) as at 30th June, 2012 and the Statement of Profit & Loss account 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 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.

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

4. Further, we report that:

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

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

c) The Balance Sheet and Statement of 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 Statement of Profit & Loss Account and the Balance Sheet comply with the Accounting Standard referred to in sub section (3C) of section 211 of the Companies Act 1956.

e) In our opinion and to the best of our information and explanations given to us in Significant Accounting Policies and Notes on Accounts, the said accounts read together with the notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give true and fair view in conformity with the accounting principles generally accepted in India:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 30th June, 2012 and;

(ii) In the case of the Statement of Profit and Loss Account, of the Profit of the company for the year ended on that date.

(iii) In so far as it relates to Cash Flow Statement, of the Cash Flow for the year ended on that date.

f) On the basis of the written representation received from Directors and taken on record by the Board of Directors we report that none of the Directors are disqualified as on 30th June, 2012, from being appointed as a Director rn term of clause (g) of sub-section (1) of section 274 of Companies Act, 1956.

ANNEXURE TO AUDITORS' REPORT (Referred to in Paragraph 3 of our report of even date)

As required by the Companies (Auditor's report) Order, 2003, issued by the Central Government of India in terms of Sub- section (4A) of section 227 of the Companies Act, 1956 and on the basis of such check as were considered appropriate and according to the information and explanation and representation given to us, we report:

1. a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.

b) The management has physically verified most of the fixed assets at the year end. No material discrepancies were noticed on such verification.

c) There is no disposal of fixed assets during the year.

2. The Company's inventory consists of intangible rights of movies and proper records of the same have been maintained by the management. Further, physical verification of said intangible rights is not possible.

3. The Company has not taken loans from parties listed in register maintained u/s 301 of the Companies Act, 1956. The Company has granted loans to companies, firms or other parties as listed in the register maintained under section 301 of the Companies Act, 1956. The year-end balance of loan given to such parties was Rs 141.10 lakhs.

4. There are adequate internal control procedures commensurate with the size of the Company and the nature of its business, being buying and selling of film rights. To the best of our knowledge, no major weaknesses in internal control were either reported or noticed by us during the course of our audit.

5. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered into in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

In our opinion and according to the information and explanations given to us, the transactions in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding Rs. 5,00,000/- (Rupees Five Lacs Only) in respect of any party during the year have been made at price, which are reasonable having regard to prevailing market price at the relevant time.

6. The Company has not accepted any deposit from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules 1975.

7. In our opinion, the internal audit system of the Company is commensurate with its size and nature of its business.

8. We have been informed that the Central Government has not prescribed for the maintenance of cost records under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956.

9. According to the records of the Company, the Company has been generally regular in depositing undisputed statutory due with the appropriate authorities. There were no undisputed amounts payable in respect of Income-tax, Wealth- tax, Sales-tax, Customs duty and Excise duty, which were outstanding as at the balance sheet date for a period of more than six months from the date they became payable.

There are no disputed dues which have remained unpaid as on 30th June, 2012 in respect of Sales tax, Income tax, Custom duty, Wealth tax, Excise duty, cess.

10. The Company has accumulated losses at the end of the financial year which does not exceed 50% of the its net worth. Also, the Company has not incurred cash losses during the financial year covered by our audit.

11. The Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders.

12. The Company has not granted any loans and advances on the basis of security during the year.

13. In our opinion, the provision of special statute applicable to Chit Fund, Nidhi or Mutual Benefit Society is not applicable to the Company.

14. In our opinion, proper records have been maintained of the transactions and contracts relating to dealing in the shares and timely entries have been made therein.

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

16. During the year, Company has not taken any term loans.

17. On the basis of overall examination of the balance sheet, we report that the funds raised on short-term basis have not been used for long-term investments and vice versa.

18. During the year, the Company had not made any preferential allotment of shares to parties and companies covered in the register maintained u/s. 301 of the Companies Act, 1956.

19. The Company has not issued debentures during the year and hence, the question of creating securities in respect thereof does not arise.

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

21. Based on the audit procedure performed and the representation obtained from the management, we report that in no case fraud on or by the Company has been noticed or reported during the year under audit.

FOR SEKHRI KANODIA & ASSOCIATES

CHARTERED ACCOUNTANTS

Sd/-

AJAY SEKHRI

(PARTNER)

MEMBERSHIP NO :- 032103

FIRM NO:- 109389W

Place : Mumbai.

Date : 12th November, 2012


Jun 30, 2010

We have audited the attached Balance Sheet of UNIVERSAL ARTS LTD, Mumbai as at 30th June, 2010 and the Profit ana Loss Account for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on the financial statements based on our audit.

1. 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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in 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.

2. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in Annexure hereto a Statement on the matters specified in paragraph 4 and 5 of the said Order.

3. Further to our comments in the Annexure referred to in paragraph 2 above, we report that :

(a) We have obtained all the information and explanation 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 those books;

(c) The Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of accounts;

(d) In our opinion, Balance Sheet and Profit andLoss Account dealt with by this report comply with the mandatory Accounting Standard referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 except for Accounting of taxes as per AS-22.

(e) In our opinion, and to the best of our information and explanations given to us none of the directors are disqualified as on 30th June, 2010 from being appointed as directors in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other 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 :

(i) In so far as it relates to Balance Sheet, of the state of affairs of the Company as at 30th June, 2010.

(ii) In so far as it relates to the Profit and Loss Account, of the Loss of Company for the year ended on that date.

(iii) In so far as it relates to Cash Flow Statement, of the Cash Flow for the year ended on that date.

ANNEXURE TO AUDITORS REPORT (Referred to in Paragraph 2 of our report of even date)

1. a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

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

c) In our opinion, the Company has not disposed of substantial part of fixed assets during the year.

2. a) As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by fne management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanation given to us, the Company has maintained proper records of inventories, As explained to us, there were no material discrepancies noticed on physical verification of inventory as compared to the book records.

3. The company has taken loans from parties listed in the register maintained U/s. 301 of the Companies Act, 1956. The year-end balance of loan taken from such parties was Rs. 0.50 lakhs.

The Company has granted loans to Companies, Firms or other parties as listed in the register maintained under section 301 and / or to the Companies under the same management as defined under sub-section (1B) of Section 370 of the Companies Act, 1956. Theyear-end balance of loan given to such parties was Rs. 142.07 lakhs. ,

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

5. a) in our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered into in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding Rs. 5,00,000/- (Rupees Five Lacs only) in respect of any party during the year have been made at price, which are reasonable having regard to prevailing market price at the relevant time.

6. As explain to us the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the Rules framed there under.

7. In our opinion, the internal audit system of the Company is commensurate with its size and nature of its business.

8. The company is not required to maintain cost record U/s. 209(1 )(d) of the Companies Act, 1956.

9. a) According to the information and explanation given to us, and records being made available to us, the undisputed statutory dues including Income-tax, Sales Tax, Wealth Tax, and other statutory dues wherever applicable have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 30th June, 2010 for a period of more than six months from the date of becoming payable.

b) In our opinion and according to the information and explanations given to us, there are no disputed statutory dues pending,before any Authority.

10. The Company has accumulated losses of Rs. 187.46 Lakhs as on 30.06.2010 and has incurred cash losses of Rs. 14.20 lakns during the Financial Year covered by our audit.

11. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the Company has not defaulted in repayment of dues to banks. .

12. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, clause 4(xiii) of the Companies (Auditors Report) Order 2003 is not applicable to the Company.

14. The Company has maintained proper records of transaction and contracts in respect of trading in securities, debentures and other investments and timely entries have been made therein. All shares, debentures and other investments have been held by the company in its own name.

15. According to information and explanation given to us and to the best of knowledge, the Company has not given guarantees for loans taken by others from Danks or financial institutions.

16. In our opinion and according to information and explanation given to us, a company has not received any terms loan during trie year.

17. According to the information and explanation given to us, and on an overall examination of the Balance Sheet of the Company, we are of the opinion that the Company has not raised funds from Short Term sources and utilized the same towards Long Term investments and vice-versa.

18. During the year, the Company had not made any preferential allotment of shares to parties and companies covered in the register maintained U/s. 301 of the Companies Act, 1956.

19. According to information and explanation given to us, the Company has not issued any secured debentures during the year.

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

21. In our opinion and according to the information and explanation given to us, no fraud on or by the Company has been noticed or reported during the year, that causes the financial statements to be materially misstated.

For SANJAY RAJA JAIN & CO,

CHARTERED ACCOUNTANTS FRN - 120132W

SANJAY RAJA JAIN

(PARTNER)

Place : Mumbai.

Date : 22nd November, 2010



 
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