Auditor Report of Viceroy Hotels Ltd.

Mar 31, 2016

INDEPENDENT AUDITOR’S REPORT

To the Members of VICEROYHOTELSLIMITED Report on the Standalone Financial Statements

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

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

Auditor’s Responsibility

Our responsibility is to express an opinion on these 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 freeform 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.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, 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, of the state of affairs of the Company as at 31st March, 2016, its profits and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the companies (Auditor’s Report) Order, 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 the paragraph 3 and4of 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) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

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

(d) In 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) 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 director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate report in ‘Annexure B’; and

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements-refer note no. 30to the 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 were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure referred to in paragraph 1 of Our Report of even date to the members of VICEROY HOTELS LIMITED on the accounts of the company for the year ended 31st March, 2016 Under “Report on other Legal & Regulatory Requirements”

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

(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in or opinion is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of records of the Company, the title deeds of immovable properties are held in the name of the Company except properties mentioned in note no.36to the financial statements.

ii. The physical verification of inventory has been conducted at reasonable intervals by the management during the yearend no material discrepancies were noticed on such verification.

iii. The company has not granted any loans secured or unsecured to companies, firms, Limited Liability Partnership firms or other parties covered in the register maintained under Section 189 of the Act.

iv. In our opinion and according to the information and explanations given to us, the company in respect of loans, investments, guarantees and security, provisions of section 185 and 186 of companies act, 2013 has been complied with.

v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits within the meaning of section 73 to 76 or any other relevant provisions of the Companies Act,2013 and the rules framed there under.

vi. In respect of the Company, the Central Government has not prescribed maintenance of cost records under subsection (1) of section 148 of the Companies Act, 2013

vii. (a) The Company is generally regular in depositing statutory dues including PF, ESI, Service Tax with the appropriate authorities and at the end of the financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable. However, there are outstanding TDS amounts which were due for more than 6 months from the date they became payable.

(b) According to the information and explanations given to us, no disputed amounts are payable in respect of Income Tax and any other statutory dues as at the end of the period.

viii. According to the information and explanations given to us, the company has defaulted in repayment of dues amounting to Rs.228.17 Crores towards principal and Rs.160.39 Crores towards interest to State Bank of India, Canara Bank, IARC Private Limited and Asset Reconstruction Company of India Limited-Refer Note no 34 to the financial statements.

ix. According to information and explanations given to us, the Company has not raised moneys byway of initial public offer or further public offer including debt instruments and term loans. Accordingly, the provisions of clause 3(ix) of the order are not applicable to the company and hence not commented upon.

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

xi. According to information and explanations given to us and to the best of our knowledge and belief, no managerial remuneration has been paid/ provided. Accordingly this clause is not applicable.

xii. In our opinion and according to information and explanations given to us, the company is not a Nidhi Company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the company and hence not commented upon.

xiii. According to the information & explanations given to us and to the best of our knowledge and belief, all the transactions with the related parties are in compliance with section 177 and 188 of the companies act 2013 wherever applicable and the details of transactions with related parties have been disclosed in the financial statements as required by the applicable accounting standard.

xiv. The company has not made any preferential allotment of private placement of shares or fully or partly convertible debentures. Therefore, the provisions of clause 3(xiv) of the order are not applicable to the company.

xv. According to information and explanations given to us and to the best of our knowledge and belief the company has not entered into any non-cash transactions with directors or persons connected with the directors. Therefore, the provisions of clause 3(xv) of the order are not applicable to the company.

xvi. According to information and explanations given to us and to the best of our knowledge and belief the company is not required to be register under section 45-IA of Reserve Bank of India Act, 1934.

“Annexure B” referred to in paragraph 2(f) under“ Report on other legal and Regulatory Requirements” section ot report on financial statements of even date to the members of VICEROY HOTELS LIMITED on the financial statement for the year ended31st march 2016.

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 VICEROY HOTELS 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 the 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.

Auditors’ Responsibility

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 were 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 auditors ‘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 the 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 31 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.

Chartered Accountants

Firm’s Regn. No. : 007257S

Place : Hyderabad

Date: 30-05-2016

Sd/-M.V. JOSHI Partner

Membership No. 024784

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Mar 31, 2015

We have audited the accompanying standalone financial statements of Viceroy Hotels Limited ("the Company"), which comprise the Balance Sheet as at March 31,2015, the Statement of Profit and Loss and Cash Flow Statement for the year thenended,anda summary of significant accounting policies and otherexplanator^' information.

Management's Responsibility forthe Standalone Financial Statements

The Company's Board of Directors is responsible forthe 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, 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 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 underthe 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 whetherthe 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 whetherthe Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, 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 of the state of affairs of the Company as at 31st March 2015, and its profit and its cash flows for the yearendedon 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 further report that:

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

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

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

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

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

f) 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, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements-refer note no.30 to the 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 were no amounts which were required to be transferred to the Investor Education and Protection Fund by the company.

Annexure referred to in paragraph 1 of Our Report of even date to the members of Viceroy Hotels Ltd the accounts of the company for the year ended 31st March, 2015 Under "Report on other Legal & Regulatory Requirements"

On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course ofouraudit,we report that:

I (a) The Company has maintained proper records showing full particulars, including quantitative details and situationoffixed assets.

(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in or opinion is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

ii. (a) The Inventory has been physically verified during the year by the Management and in our opinion, the frequency of verificationis reasonable.

(b) In our opinion, the procedures of the physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventoriesand no material discrepancies were noticed on physical verification.

iii. According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii)(a) and (b)of the order are not applicable to the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Companyand the nature of its business, for the purchase of fixed assets and for the sale of services. Further, on the basis of our examination of the books and records of the Companyand according to the information and explanations givento us, no major weakness has been noticed or reported.

v. The Company has not accepted any deposits from the public covered under Section 73 to 76 and other relevant provisions ofthe Companies Act, 2013.

vi. In respect ofthe company, the Central Government has not prescribed maintenance of Cost records under sub-section (1) of Section 148 of the Act, 2013.

vii. (a) The Company is generally regular in depositing statutory dues including PF, ESI, Service Tax with the appropriate authorities and at the end of the financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable. However in Respect of TDS & WCT an amount of Rs. 2,19,36,208/- is outstanding which were due for more than 6 months from the date they became payable (i.e Year-wise 2011-12 is Rs.1,13,00,004/-, 2012-13 is Rs.85,94,111/- and 2013-14 is Rs. 6,82,787/- and year 2011-12 WCT is Rs. 13,59,306/-).

(b) There were no disputed amounts payable in respect of Income tax or Sales tax or Wealth tax or Service tax or Duty of Customs or Duty of Excise or value added taxor Cess as at 31 st March 2015.

(c) There are no amounts that are due to be transferred to the Investors Education and protection Fund in accordance with the relevant provisions ofthe Companies Act, 2013 and rules made there under.

viii. The Company has no accumulated losses as at the end of the financial year and it has not incurred cash losses in thisfinancialyearand inthe immediately preceding financial year.

ix. According to the information and explanations given to us, the company has defaulted in repayment of dues amounting to Rs 191.85 crore towards principal and Rs 138.20 crore towards interest to banks and other institutions - refer note no 34 to the financial statements.

x. According to the information and explanations given to us, the Company has given corporate guarantee for loan taken by M/s Crustums Products Pvt Ltd., from Oriental bank of commerce and the terms and conditions are not prejudicial to the interest ofthe company.

xi. According to the information and explanations given to us, the Term Loans obtained by the company were applied for the purpose for which such loans were obtained by the Company.

xii. During the course of our examination of the books and records of the Company, carried out in accordance with the Generally Accepted Auditing Practice in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such cases by the management.

For P. MURALI & CO., Chartered Accountants Firm's Regn. No. : 007257S

Place : Hyderabad Date : 30-05-2015

Sd/- M.V. JOSHI Partner Membership No. 024784

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Mar 31, 2014

We have audited the accompanying financial statements of VICEROY HOTELS LIMITED ("The Company"), which comprise the Balance Sheet as at March 31,2014, and the Statement of Profit and Loss and Cash Flow Statement for the yearended,andasummaryofsignificantaccounting policiesand other explanatory information.

Management''sResponsibilityforthe Financial Statements:

The Company''s Management is responsibleforthe preparation of these financial statementsthatgiveatrueandfairview of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Sub-Section(3C)of Section 211 of the Companies Act,1956(''the Act'')read with the General circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act,2013. 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 orerror.

Auditor''s Responsibility:

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

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 ofthe financial statements,whetherduetofraudorerror.

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 entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluatingthe overall presentation of thefinancial statements.

We believethattheauditevidencewehave obtained issufficient and appropriate toprovidea basis forourauditopinion.

Opinion:

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

(a) Inthe case ofthe Balance Sheet, ofthe state ofaffairs ofthe Companyas at March 31,2014; and

(b) Inthe case ofthe Statement of Profit and Loss Account, ofthe loss forthe year ended on that date; and

(c) Inthe case ofthe Cash Flow Statement, of the cash flows forthe year ended on that date.

Report on OtherLegal 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 forthe purpose of our audit;

b Inouropinion properbooks of accountas required bylawhavebeen kept by the Company.

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in Sub-Section(3C)of Section 211 of the Companies Act,1956(''the Act'')read with the General circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act,2013.

e) On the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS'' REPORT

I. (a) The Company has maintained proper records showing full particulars including quantitative details and situationof Fixed Assets.

(b) Some of the fixed assets were physically verified during the year by the Management in accordance with a regular program of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

II. (a) The Inventory has been physically verified during the year by the Management and in our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of the physical verification of inventory followed by the Management are reasonableand adequate in relation to the size ofthe Company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

III. (a) The Company has not granted any loans, unsecured to/from Companies, Firms or other parties covered in the register maintained under section 301 of the Companies Act,1956..

(b) As the Company has not granted any loans, the clause of whether the rate of interest & other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 prejudicial tothe interest ofCompany, isnotapplicable.

(c) As no loans are granted by the Company, the clause of receipt of interest & principal amount from parties, is notapplicabletothe Company.

(d) No loans have been granted to Companies, Firms and other parties listed in the register U/s 301 of the Companies Act, 1956. Hence, over due Amount of more than one lakh does not arise and the clause is not Applicable.

(e) The Company has not taken any loans, secured or unsecured from Companies, Firms or other Parties covered in the register maintained U/s 301 ofthe Companies Act, 1956.

(f) As the Company has not taken any loans, the clause of whether the rate of interest and other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is prejudicial to the interest of Company, is not applicable.

(g) As no loans are taken by the Company, the clause of repayment of interest & principal amount to parties is notapplicabletothe Company.

IV. In our opinion and according tothe information and explanations given to us, there are generally adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods and services. There is no continuing failure by the company to correct any majorweaknessesin internal control.

V. (a) According to the information and explanations provided by management, no contracts or arrangements is entered with the parties listed in the register under section 301, therefore applicability of the clause regarding the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 does notarise.

(b) According to the information and explanations given to us, as no such contracts or arrangements made by the company, the applicability of the clause of charging the reasonable price having regard to the prevailing market prices at the relevant time does not arise.

VI. The Company has not accepted any deposits from the public and hence the applicability of the clause of directives issued by the Reserve Bank of Indiaand provisions of section 58A, 58AA or any other relevant provisions of the Act and the rules framed there under does not arise. As per information and explanations given to us no order from the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has been received by the Company.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records under clause

(d) of sub-section(1) of section 209 of the Companies Act, 1956.

IX. (a) The Company is generally regular in depositing statutory dues including PF, ESI, Service Tax with the appropriate authorities and at the end of the financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable. However in Respect of TDS & WCT an amount of Rs. 2,21,54,450/- is outstanding which were due for more than 6 months from the date they became payable (i.e Year-wise 2011-12 is Rs.1,13,21,895/-, 2012-13 is Rs.85,94,111/- and 2013-14 is Rs.8,79,138/- and year 2011-12 WCT is Rs. 13,59,306/-).

(b) b. According to the information and explanations given to us, there is no disputed amount payable in respect of PF, ESI, Income Tax, Cess etc.

X. The Company has been registered for a period of not less than 5 years, and the company has no accumulated losses at the end of the financial year and the company has not incurred cash losses in this financial year and in the immediately preceding financial year.

XI. According to information and explanations given to us, the company has defaulted in repayment of dues amounting to Rs.101.58 Crores towards principal and Rs. 90.55 crores towards interest to financial Institutions and Banks.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does notarise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies.

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order 2003, are not applicable to the Company.

XV. According to the information and explanations given to us, the Company has given corporate guarantee for loan taken by M/s Crustums Products Pvt Ltd., from Oriental bank of commerce and the terms and conditions are not prejudicial to the interest of the company.

XVI. According to the information and explanations given to us, the Term Loans obtained by the company were applied forthe purpose for which such loans were obtained by the Company.

XVII. According to the information given to usand on an overall examination of the Balance Sheetofthe Company, we report that funds raised on short-term basis have not been used for long term investment and vice-versa during theyear underaudit.

XVIII. According to the information and explanations given to us, the Company has not made any preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is prejudicial to the interest ofthe Company does not arise.

XIX. According to the information and explanations given to us, the company has issued 500 debentures of Rs.10,00,000/- each on 21st March 2007 and the has created the security for the debentures issued by the company.

XX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by public issue is notapplicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

For P. MURALI & CO., Chartered Accountants

Firm''s Regn. No. : 007257S

Place : Hyderabad

Date : 22-05-2014 Sd/-

P. MURALI MOHANA RAO Partner

Membership No. 023412

---

Mar 31, 2013

Reportonthe Financial Statements:

We have audited the acCompanying financial statements of Viceroy Hotels Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, andasummaryofsignificant 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 atrue and fair view and are free from material misstatement, whether due to fraudorerror.

Auditor''s Responsibility:

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraudorerror.

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 madeby management,aswell as evaluating the overall presentation of the financial statements.

We believe that the audit evidencewe have obtained is sufficient and appropriatetoprovideabasis 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 acceptedinIndia:

(a) Inthe case of the Balance Sheet,ofthe stateofaffairsofthe CompanyasatMarch 31, 2013;

(b) Inthe case of the Statement of Profit or Loss, of the loss for the year endedonthat date; and

(c) Inthe case of the Cash Flow Statement, of the cash flows for the year endedonthat date.

ReportonOther Legal andRegulatoryRequirements:

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 requiredby section 227(3) of the Act, wereport 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 and proper returns adequate for the purposes of our audit have been received from branches not visited by us;

c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the booksofaccount and with the returns received from branches not visitedbyus;

d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referredtoinsubsection (3C) of section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as adirector in termsofclause (g) of sub-section (1)ofsection 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS'' REPORT

I. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

(c) The Company has not disposed off substantial part of the Fixed Assets during the year.

II. (a) The Inventory has been physically verified during the year by the Management and in our opinion, the frequency of verificationis reasonable.

(b) In our opinion, the procedures of the physical verification of inventory followed by the Management are reasonable and adequateinrelation to the sizeofthe Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and as explained to us, no material discrepancies were noticedonphysical verification of stocks as compared to book records.

III. (a) The Company has not granted any loans, unsecured to/from Companies, Firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) As the Company has not granted any loans, the clause of whether the rate of interest & other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 prejudicialtothe interest of Company, is not applicable.

(c) As no loans are granted by the Company, the clause of receipt of interest & principal amount from parties, is not applicabletothe Company..

(d) No loans have been granted to Companies, Firms and other parties listed in the register U/s 301 of the Companies Act, 1956. Hence, over due Amount of more than one lakh does not arise and the clause is not Applicable.

(e) The Company has not taken any loans, secured or unsecured from Companies, Firms or other Parties coveredinthe register maintained U/s 301 of the Companies Act, 1956..

(f) As the Company has not taken any loans, the clause of whether the rate of interest and other terms and conditions on which loans have been taken from parties listedin the register maintained under section 301 is prejudicialtothe interest of Company, is not applicable. .

(g) As no loans are taken by the Company, the clause of repayment of interest & principal amount to parties is not applicabletothe Company.

IV. In our opinion and according to the information and explanations given to us, there are generally adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods and services. There is no continuing failure by the Companytocorrect any major weaknesses in internal control.

V. (a) According to the information and explanations provided by management, no contracts or arrangements is entered with the parties listed in the register under section 301, therefore applicability of the clause regarding the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 does not arise.

(b) According to the information and explanations given to us, as no such contracts or arrangements made by the Company, the applicability of the clause of charging the reasonable price having regard to the prevailing market prices at the relevant time does not arise.

VI. The Company has not accepted any deposits from the public and hence the applicability of the clause of directives issued by the Reserve Bank of India and provisions of section 58A, 58AA or any other relevant provisions of the Act and the rules framed there under does not arise. As per information and explanations given to us no order from the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has been received by the Company.

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

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records under clause (d)ofsub-section(1)ofsection 209ofthe Companies Act, 1956.

IX. (a) The Company is generally regular in depositing statutory dues including PF, ESI, Service Tax with the appropriate authorities.

(b) According to the information and explanation given to us, there are no dues of sales tax, wealth tax, service tax, customs duty, excise duty and cess which have fallen due on before 31st March 2013 and not been deposited with appropriate authorities on account of any dispute except for Rs. 1,54,10,269/- which is pendinginappeals.

X. The Company has been registered for a period of not less than 5 years, and the Company has no accumulated losses at the end ofthe financial year and the Company has not incurred cash lossesin this financial year and in the immediately preceding financial year.

XI. According to information and explanations given to us, the Company has defaulted in repayment of dues amountingtoRs.55.74 crores to financial Institutions and Banks.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenanceofadequate documents in respectofloans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit FundinrespectofNidhi/Mutual Benefit Fund/Societies.

XIV. According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order 2003, are not applicabletothe Company.

XV. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from BanksorFinancial Institutions other than guarantees given to banks for the loan taken by M/s Crustums Products Pvt Ltd., Subsidiary Company and hence the applicability of this clause regarding terms and conditions which are prejudicialtothe interest of the Company does not arise.

XVI. According to the information and explanations given to us, the Term Loans obtained by the Company were applied for the purpose for which such loans were obtained by the Company.

XVII. According to the information given to us and on an overall examination of the Balance Sheet of the Company, we report that funds raised on short-term basis have not been used for long term investment and vice-versa during the year under audit.

XVIII. According to the information and explanations given to us, the Company has not made any preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is prejudicial to the interestofthe Company does not arise.

XIX. According to the information and explanations given to us, the Company has issued 500 debentures of Rs. 10,00,000/- each on 21st March 2007 and the has created the security for the debentures issued by the Company.

XX. According to information and explanations given to us, the Company has not raised money by wayof public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by public issue isnot applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

For P. MURALI & CO.,

Chartered Accountants

Firm''s Regn. No. : 007257S

Place : Hyderabad

Date : 29-05-2013 Sd/-

P. MURALI MOHANA RAO

Partner

Membership No. 023412

---

Mar 31, 2012

We have audited the attached Balance Sheet of VICEROY HOTELS LIMITED as at 31st March, 2012 and also the Profit & Loss Account for the period ended on the date annexed thereto and the cash flow statement for the period ended on that date. These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall statement presentation. We believe that our audit provides a reasonable basis of our opinion.

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

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

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

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

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

(iv) In our opinion, the Balance Sheet & Profit & Loss Account dealt with by this report comply with the Accounting standards referred toin sub-section (3C) of Section 211 of Companies Act, 1956;

(v) On the basis of written representations received from the Directors, as on31st March ,2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2012 from being appointed Director in terms of clause(g) Of sub-section(1) of section 274 of the Companies Act,1956;

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

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

(b) In the case of the Profit & Loss Account, of the loss for the Period ended on that date;

And

(c) In the case of the Cash Flow, of the cash flows for the period ended on that date.,

Annexure to the Auditor’s Report

I. (a) The Company has maintained proper records showing full particulars Including quantitative details and situation of Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

(c) The Company has not disposed off substantial part of the Fixed Assets during the year.

II. (a) The Inventory has been physically verified during the year and in our Opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of the physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

The Company is maintaining proper records of inventory and as explained to us, no material discrepancies were noticed on physical verification of stocks as compared to book records.

III. a) The Company has granted and taken loans, unsecured to/from Companies, Firms or other Parties covered in the register maintained U/s.301 of the Companies Act, 1956 and registers are being maintained by the company.

b) The Company has granted loans, the rate of interest & other term and conditions on which loans have been granted to parties listed in the register maintained under section 301 is not prejudicial to the interest of the Company.

c) The loans are granted by company, the clause of receipt of interest & principal amount from parties, are not prejudicial to the company.

d) The loans have been granted to Companies, Firms & other parties listed in the register U/s.301 of the Companies Act, 1956, and there is no overdue amount of loan

e) The Company has taken loans, unsecured from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and registers are being maintained.

f) The Company has taken loans, and the rate of interest & other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is not prejudicial to the interest of the company.

g) The repayment of interest & principal amount to parties, are not prejudicial to the company.

IV. In our opinion and according to the information and explanations given to us, there are generally adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods.

There is no continuing failure by the company to correct any major weaknesses in internal control.

V. a) According to the information and explanations provided by Management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under Section 301 havebeen so entered.

b) In our opinion and according to the information and explanations given to us, as no such contracts or arrangements made by the Company, applicability of the clause of the charging the reasonable price having regard to the prevailing market prices at the relevant time does not a rise.

VI. The Company has not accepted any deposits from the public.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records under clause (d) of sub-section(1) of section 209 of theCompaniesAct,1956.

IX. a) The Company is regular in depositing statutory dues including PF, ESI, Income Tax, and any other statutory dues with the appropriate authorities and at the last of the financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable.

b) According to the information and explanations given to us, no undisputed amounts are payable in respect of PF, ESI, Income Tax, and any other statutory dues as at the end of the period, for a period more than six months from the date they became payable.

X. The Company has been registered for a period of not less than 5 years, and the company has no accumulated losses at the end of the financial year and the company has not incurred cash losses in this financial year and in the immediately preceding such financial year.

XI. According to information and explanations given to us, the Company has defaulted in repayment of dues amountingtoRs.30.40Croresto financial Institutions and banks.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies.

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, Securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditor’s Report) Order2003, are not applicable to the Company.

XV. 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 other than guarantees given to banks for the loan taken by M/s Crustums Products Pvt Ltd., Subsidiary Company and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company does not arise.

XVI. According to the information and explanations given to us, the Term Loans were applied by the company for the purpose for which the loans were obtained.

XVII. According to the information given to us and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short-term basis have not been used for long term investment and vice-versa during the year under audit.

XVIII. According to the information and explanations given to us, the Company has not made preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is not prejudicial to the interest of the Company.

XIX. According to the information and explanations given to us, the company has issued 500 debentures of Rs.10,00,000/- each on 21st March 2007 and the company has created the security for the debentures issued by the company.

XX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

For P.MURALI & CO.,

Chartered Accountants

Firm’s Regn. No. : 007257S

Hyderabad

August 14, 2012

SD/-

P.MURALI MOHANA RAO

PARTNER

Membership No. 23412

---

Mar 31, 2011

We have audited the attached Balance Sheet of VICEROY HOTELS LIMITED as at 31st March, 2011 and also the Profit & Loss Account for the period ended on the date annexed thereto and the cash flow statement for the period ended on that date. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall statement presentation. We believe that our audit provides a reasonable basis of our opinion.

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

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

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

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

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

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

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

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

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

(b) In the case of the Profit & Loss Account, of the loss for the period ended on that date;

And

(c) In the case of the Cash Flow, of the cash flows for the period ended on that date.,

Annexure to the Auditor's Report

I. (a) The Company has maintained proper records showing full particulars including quantitative details

and situation of Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

(c) The Company has not disposed off substantial part of the Fixed Assets during the year.

II. (a) The Inventory has been physically verified during the year and in our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of the physical verification of inventory followed by the

Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

The Company is maintaining proper records of inventory and as explained to us, no material discrepancies were noticed on physical verification of stocks as compared to book records.

III. The Company has granted and taken loans, unsecured to / from Companies, Firms or other Parties covered in the register maintained U/s.301 of the Companies Act, 1956 and registers are being maintained by the company.

The Company has granted loans, the rate of interest & other term and conditions on which loans have been granted to parties listed in the register maintained under section 301 is not prejudicial to the interest of the Company.

The loans are granted by company, the clause of receipt of interest & principal amount from parties, are not prejudicial to the company.

The loans have been granted to Companies, Firms & other parties listed in the register U/s.301 of the Companies Act, 1956, and there is no overdue amount of loan

The Company has taken loans, unsecured from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and registers are being maintained.

The Company has taken loans, and the rate of interest & other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is not prejudicial to the interest of the company.

The repayment of interest & principal amount to parties, are not prejudicial to the company.

IV. In our opinion and according to the information and explanations given to us, there are generally adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods.

There is no continuing failure by the company to correct any major weaknesses in internal control.

V. a) In our opinion and according to the information and explanation given to us, there are no transactions made by the company in respect of any party in the financial year and hence the maintenance of registrar under section 301 of the Companies Act, 1956 does not arise.

(b) According to the information and explanations given to us, as there are no transactions made by

the company, hence the charging of reasonable price does not arise.

VI. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 58A and 58AA of the Companies Act, 1956 and the Companies(Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. No order is passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records under clause (d) of sub-section(1) of section 209 of the Companies Act, 1956.

IX. a) The Company is regular in depositing statutory dues including P F, ESI, Income Tax, and any other

statutory dues with the appropriate authorities and at the last of the financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable. b) According to the information and explanations given to us, no undisputed amounts are payable in respect of PF, ESI, Income Tax, and any other statutory dues as at the end of the period, for a period more than six months from the date they became payable.

X. The Company has been registered for a period of not less than 5 years, and the company has no accumulated losses at the end of the financial year and the company has not incurred cash losses in this financial year and in the immediately preceding such financial year.

XI. According to information and explanations given to us, the Company has not defaulted in repayment of dues to financial Institutions or banks.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies.

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, Securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order 2003, are not applicable to the Company.

XV. 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, other than guarantees given to banks for the loans taken by M/s Crustum Products Pvt. Ltd., Subsidiary Company and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company does not arise.

XVI. According to the information and explanations given to us, the Term Loans were applied by the company for the purpose for which the loans were obtained.

XVII. According to the information given to us and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short-term basis have not been used for long term investment and vice-versa during the year under audit.

XVIII. According to the information and explanations given to us, the Company has not made preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is not prejudicial to the interest of the Company.

XIX. According to the information and explanations given to us, the company has issued 500 debentures of Rs.10,00,000/- each on 21st March 2007 and the company has created the security for the debentures issued by the company.

XX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

For P.MURALI & CO.,

Chartered Accountants

Firm's Regn. No. : 007257S

Hyderabad

August 13, 2011 SD/- P.MURALI MOHANA RAO

PARTNER Membership No. 23412

---

Mar 31, 2010

We have audited the attached Balance Sheet of VICEROY HOTELS LIMITED as at 31st March, 2010 and also the Profit & Loss Account for the period ended on the date annexed thereto and the cash flow statement for the period ended on that date. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

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

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

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

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

(v) On the basis of written representations received from the Directors, as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2010 from being appointed Director in terms of clause(g) of sub-section(l) of section 274of the Companies Act,1956;

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

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

(b) In the case of the Profit & Loss Account, of the loss for the period ended on that date;

And

(c) In the case of the Cash Flow, of the cash flows for the period ended on that date.,

ANNEXURE TO THE AUDITORS REPORT I. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

(c) The Company has not disposed off substantial part of the Fixed Assets during the year.

II. (a) The Inventory has been physically verified during the year and in our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of the physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

The Company is maintaining proper records of inventory and as explained to us, no material discrepancies were noticed on physical verification of stocks as compared to book records.

III. The Company has granted and taken loans, unsecured to / from Companies, Firms or other Parties covered in the register maintained U/s.301 of the Companies Act, 1956 and registers are being maintained by the company.

The Company has granted loans, the rate of interest & other term and conditions on which loans have been granted to parties listed in the register maintained under section 301 is not prejudicial to the interest of the Company.

The loans are granted by company, the clause of receipt of interest & principal amount from parties, are not prejudicial to the company.

The loans have been granted to Companies, Firms & other parties listed in the register U/s.301 of the Companies Act, 1956, and there is no overdue amount of loan The Company has taken loans, unsecured from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and registers are being maintained.

The Company has taken loans, and the rate of interest & other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is not prejudicial to the interest of the company.

The repayment of interest & principal amount to parties, are not prejudicial to the company.

IV. In our opinion and according to the information and explanations given to us, there are generally adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods.

There is no continuing failure by the company to correct any major weaknesses in internal control.

V. a) In our opinion and according to the information and explanation given to us, there are no transactions made by the company in respect of any party in the financial year and hence the maintenance of registrar under section 301 of the Companies Act, 1956 does not arise.

(b) According to the information and explanations given to us, as there are no transactions made by the company, hence the charging of reasonable price does not arise.

VI. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 58A and 58AAofthe Companies Act, 1956 and the Companies(Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. No order is passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records under clause (d) of sub-section(l) of section 209 of the Companies Act, 1956.

IX. a) The Company is regular in depositing statutory dues including PF, ESI, Income Tax, and any other statutory dues with the appropriate authorities and at the last of the financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable.

b) According to the information and explanations given to us, no undisputed amounts are payable in respect of PF, ESI, Income Tax, and any other statutory dues as at the end of the period, for a period more than six months from the date they became payable.

X. The Company has been registered for a period of not less than 5 years, and the company has no accumulated losses at the end of the financial year and the company has not incurred cash losses in this financial year and in the immediately preceding such financial year.

XI. According to information and explanations given to us, the Company has not defaulted in repayment of dues to financial Institutions or banks.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies.

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, Securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditors Report) Order 2003, are not applicable to the Company.

XV. 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, other than guarantees given to banks for the loans taken by M/s Crustum Products Pvt. Ltd., Subsidiary Company and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company does not arise.

XVI. According to the information and explanations given to us, the Term Loans were applied by the company for the purpose for which the loans were obtained.

XVII. According to the information given to us and on an overall examination of the Balance Sheet of the Company, we report that the funds raised on short-term basis have not been used for long term investment and vice-versa during the year under audit.

XVIII. According to the information and explanations given to us, the Company has not made preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is not prejudicial to the interest of the Company.

XIX. According to the information and explanations given to us, the company has issued 500 debentures of Rs. 10,00,000/- each on 21st March 2007 and the company has created the security for the debentures issued by the company.

XX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

For P.MURALI & CO.,

CHARTERED ACCOUNTANTS

P.MURALI MOHANA RAO

PARTNER

Membership No. 23412 PUCE : HYDERABAD

DATE : 26-08-2010