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Auditor Report of BGR Energy Systems Ltd.

Mar 31, 2023

BGR Energy Systems Limited Report on Audit of the Standalone Financial Statements

OPINION

We have audited the accompanying Standalone Financial Statements of BGR Energy Systems Limited (referred to as the âCompanyâ) which comprises the Balance Sheet as at March 31,2023, the Statement of Profit and Loss (including other comprehensive income), Statement of Cash Flows and Statement of changes in Equity for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.

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, in the manner so required, and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Companies Act 2013 read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the company as at March 31,2023, the Loss including other comprehensive income, changes in equity and its cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditorâs Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013 and the Rules there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the financial statements.

KEY AUDIT MATTERS:

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the year ended March

31,2023. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

1. Revenue Recognition in case of Construction Contracts:

The Company recognises revenue in case of Revenue from Construction Contracts on the basis of stage of completion based on the proportion of contract costs incurred, relating to the total costs of the contract at completion. Thus, the recognition of revenue is based on estimates in relation to total estimated costs of each contract and cost incurred. There are significant accounting judgments which include estimates of cost of completion of the Contract, the stages of completion and timing of revenue recognition.

Estimates also takes into account various contingencies in the contracts & uncertain risks, disputed claims against the company relating to different contract which are reviewed by the management on a regular basis over the contract life and adjusted appropriately.

The revenue on contracts may also include variable consideration (variations and claims). Variable consideration is recognised when the recovery of such consideration is probable.

As revenue recognition involves aforesaid significant judgement and estimation, we therefore determined this to be a key audit matter.

Our principal audit procedures included but were not limited to:

? We assessed the appropriateness of the Companyâs revenue recognition policies, including those related to variable considerations by comparing with applicable accounting standards;

? We tested the effectiveness of controls relating to the evaluation of performance obligations and identification of those that are distinct; estimation of costs to complete each of the performance obligations including the contingencies in respect thereof, as work progresses and the impact thereon as a consequence of change orders; the impact of change orders on the transaction price of the related contracts; and evaluation of the impact of variable consideration on the transaction price.

? We selected a sample of contracts with customers and performed the following procedures:

o Obtained and read contract documents for each selection, change orders and other documents that were part of the agreement/arrangement.

o Identified significant terms and deliverables in the contract to assess managementâs conclusions regarding the (i) identification of distinct performance obligations; (ii) changes to costs to complete as work progresses and as a consequence of change orders; (iii) the impact of change orders on the transaction price; and (iv) the evaluation of the adjustment to the transaction price on account of variable consideration.

o Compared costs incurred with Companyâs estimates of costs incurred to date to identify significant variations and evaluated whether those variations have been considered appropriately in estimating the remaining costs to complete the contract.

o Tested the estimate for consistency with the status of delivery of milestones and customer acceptance to identify possible delays in achieving milestones, which require changes in estimated costs or efforts to complete the remaining performance obligation

? Performed analytical audit procedures for reasonableness of revenues disclosed by type and nature of service.

? Assessed appropriateness of the relevant disclosures made by the company in accordance with Ind AS 115.

We concluded that based on the procedures performed above, we did not find any material exceptions with regards to adoption of Ind AS 115 and timing of revenue recognition.

INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITORâS REPORT THEREON:

The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Directorsâ Report and Management Discussion and Analysis, but does not include the consolidated financial statements, standalone financial statements and our auditorâs report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we performed, we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance. We have nothing to report in this regard.

RESPONSIBILITY OF MANAGEMENT FOR THE STANDALONE FINANCIAL STATEMENTS:

The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate implementation and maintenance of 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 statement that give a true and fair view and are free from material misstatements, whether due to fraud or error.

In preparing the Standalone financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the companyâs financial reporting process.

AUDITORâS RESPONSIBILITY FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS:

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatements, whether due to

fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

a. Identify and assess the risks of material misstatements of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

b. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3) (i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether company has adequate internal financial controls system in place and the operating effectiveness of such controls;

c. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

d. Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern;

e. Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial

statements represent the underlying transactions and events in a manner that achieves fair presentation;

Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work: and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

OTHER MATTERS:

1. The comparative financial information of the company for the year ended 31^st March,2022 included in these Standalone financial statements, are audited by the predecessor auditors of the company and their report dated 20^th May,2022, wherein an unmodified opinion is expressed by them.

Our opinion is not modified in respect of these matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS:

1. As required by the Companies (Auditorâs Report) Order, 2020 (âthe Orderâ) as amended, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we

give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable our report thereon is enclosed as âAnnexure Aâ.

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 and proper adequate returns have been received from all the regional offices of the company;

c. The Companyâs Balance Sheet, the Statement of Profit and Loss (incl. Other Comprehensive income), the Statement of Cash Flows and the Statement of Changes in Equity dealt with by this report are in agreement with the books of accounts;

d. In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with The Companies (Indian Accounting Standards) Rules, 2015, as amended thereon.

e. On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2023 from being appointed as a director in terms of Section 164(2) of the Act.

f. With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ. Our report expresses unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting;

g. With respect to the other matters to be included in the Auditorsâ Report in accordance with the requirements of section 197(16) of the Act, as amended:

In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.

h. With respect to the other matters to be included in the Auditorâs 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 standalone financial statements; (Refer Note No. 36 to the Standalone Financial Statements)

ii. The company has made provision, as required under applicable law or accounting standards, for material foreseeable losses, if any on longterm contracts including derivative contracts;

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

iv. a. The management has represented that,

to the best of itâs knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall,

? directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (âUltimate Beneficiariesâ) or

? provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

b. The management has represented, that, to the best of itâs knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the company shall,

? directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or

? on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

c. Based on such audit procedures as considered reasonable and appropriate in these circumstances, nothing has come to our notice that has caused them to believe that the representations under subclause (i) and (ii) contain any material misstatement.

v. In lieu of carried over previous yearsâ and

current year losses, the company has not

declared and/or paid any dividend during the year in accordance with Sec. 123 of the Companies Act, 2013;

Mar 31, 2018

REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS

We have audited the accompanying standalone Ind AS financial statements of BGR Energy Systems Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, and the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Managementâs Responsibility for the Standalone Ind AS Financial Statements

The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation and presentation of these standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with relevant rules issued thereunder.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; 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 standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITORSâ RESPONSIBILITY

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.

In conducting 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 thereunder.

We conducted our audit of standalone Ind AS financial statements 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 standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS 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 Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.

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

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS 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 including the Ind AS, of the state of affairs (financial position) of the Company as at March 31, 2018, and its profit(financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1) As required by the Companies (Auditorsâ Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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

a. We have sought and obtained all 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, the Statement of Profit and Loss(including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d. In our opinion, the aforesaid standalone Ind AS 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 March 31, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of Section 164(2) of the Act.

f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure B; and

g. With respect to the other matters to be included in the Auditorâs Report in accordance with the Rule 11 of the Companies (Audit and Auditors) Rules, 2014 as amended, 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 standalone Ind AS financial statements - Refer Note nos. 3.c.(i), 3.c.(ii) and 34 to the standalone Ind AS financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;

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

iv.The disclosure in the Standalone Ind AS Financial Statements regarding holdings as well as dealings in specified bank notes during the period from November 8, 2016 to December 30, 2016 have not been made since they do not pertain to the financial year ended March 31, 2018. However amounts as appearing in the audited Ind AS Financial Statements for the year ended 31 March 2017 have been disclosed vide reference to Note no 41.

ANNEXURE A TO THE INDEPENDENT AUDITORSâ REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS

The Annexure referred to in paragraph 1 under the heading âReport on Other Legal and Regulatory Requirementsâ of our Independent Auditorsâ Report to the members of BGR ENERGY SYSTEMS LIMITED for the year ended March 31, 2018, we report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The Company has a regular program of physical verification of its fixed assets by which fixed assets are verified in a phased manner on a rotational basis. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets; and

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii) According to the information and explanations given to us and on the basis of our examination of the records of the Company, we are of the opinion that the management has conducted the physical verification of inventory at reasonable intervals during the year. There are no material discrepancies were noticed between book stock and physical stock on physical verification conducted by the management.

(iii) The Company has not granted any loans to parties covered in the register maintained under section 189 of the Act during the year. Accordingly, paragraph 3(iii)(a), (b) and (c) of the Order is not applicable.

(iv) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the company has not granted loans and guarantees to any parties covered under Section 185 of the Act.

In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 186 of the Act.

(v) The Company has not accepted any deposits from the public within the meaning of sections 73 to 76 of the Act and the rules framed there under to the extent notified. Therefore, the provisions of clause (v) of the Companies (Auditorsâ Report) Order, 2016, are not applicable to the Company.

(vi) We have broadly reviewed the cost records maintained by the Company as specified by the Central Government under Section 148(1) of the Act and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) (a) I n our opinion and according to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employeesâ State Insurance, Profession Tax, Income-tax, Sales-tax, Value Added Tax, Works Contract Tax, Service tax, Customs Duty, Excise Duty, Goods and Service tax, Cess and other statutory dues have generally been regularly deposited during the year by the company with the appropriate authorities.

According to the information and explanations given to us and on the basis of our examination of the records of the Company, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Profession Tax, Income-tax, Sales-tax, Value Added Tax, Works Contract Tax, Service tax, Customs Duty, Excise Duty, Goods and Service tax, Cess were in arrears as at March 31, 2018, for a period of more than six months from the date they became payable; and

(b) As per the information and explanations given to us, the following are the details of statutory dues which have not been deposited by the Company on account of disputes:

Name of the Statute	Nature of Due	Disputed tax amount (Rs. in Lakhs)	Financial year	Forum in which the dispute is lying in
Central Sales Tax Act, 1956	Central Sales Tax	4.20	1997-98	The Honourable High Court, Andhra Pradesh.
Central Sales Tax Act, 1956	Central Sales Tax	35.03	1997-98	The Honourable High Court, Andhra Pradesh.
Andhra Pradesh Value Added Tax Act, 2005	Andhra Pradesh Sales Tax	0.12	1998-99	Commercial Tax officer, Andhra Pradesh.
Tamil Nadu General Sales Tax Act, 1959	Tamil Nadu Sales Tax	0.11	1999-00	Commercial Tax officer, Tamilnadu.
Tamil Nadu General Sales Tax Act, 1959	Tamil Nadu Sales Tax	2.21⁽¹⁾	2001-02	Sales Tax Appellate Tribunal, Chennai, Tamilnadu.
Central Sales Tax act, 1956	Central Sales Tax	5.58⁽¹⁾	2004-05	Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh.
Andhra Pradesh Value Added Tax Act, 2005	Andhra Pradesh Sales Tax (Penalty)	2.59⁽¹⁾	2006-07	Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh.
Kerala Value Added Tax Act, 2003	Kerala Sales Tax	2.65⁽¹⁾	2006-07	The Deputy Commisioner (Appeals), Ernakulam, Kerala.
Andhra Pradesh Value Added Tax Act, 2005	Andhra Pradesh Sales Tax ( Penalty)	7.43⁽¹⁾	2007-08	Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh.
Chapter V of Finance Act, 1994	Service Tax	25.26⁽²⁾	2007-08	CESTAT Chennai, Tamilnadu.
The Rajasthan Value Added Tax, 2003	Rajasthan Sales Tax	9865.96⁽¹&³⁾	2009-2010	Rajasthan Tax Board, Ajmer
The Rajasthan Value Added Tax, 2003	Rajasthan Sales Tax	9541.31⁽¹&³⁾	2010-2011	Rajasthan Tax Board, Ajmer
The Rajasthan Value Added Tax, 2003	Rajasthan Sales Tax	4333.66⁽¹&³⁾	2011-2012	Rajasthan Tax Board, Ajmer
Central Sales Tax Act, 1956	Central Sales Tax	261.76⁽¹⁾	2014-15	The Appellate Deputy Commissioner (CT) North, Chennai.

Central Sales Tax Act, 1956	Central Sales Tax	95.88	2013-14	The Tamil nadu Sales Tax Appellate Tribunal, Chennai -104
Central Sales Tax Act, 1956	Maharashtra Value Added Tax	47.10⁽³⁾	2013-14	The Joint Commissioner of Sales Tax, Appeal VII, Mumbai
Chapter V of Finance Act, 1994	Service Tax	24482Â®	2007-08 to 2014-15	CESTAT Chennai, Tamilnadu.
Chapter V of Finance Act, 1994	Service Tax	11798.95⁽³⁾	2014-15 to 2017-18	Refer foot note(4) bellow the table
Chapter V of Finance Act, 1994	Service Tax	306.45Â®	2007-08 to 2014-15	Refer foot note(5) bellow the table
The Employee Provident Fund & Miscellaneous Provisions Act, 1952	Provident Fund	521.15⁽¹⁾	2006-2010	The Honourable High Court, Hyderabad
Income-tax Act, 1961	Income tax	137.65⁽¹&²⁾	2006-07	The Hounourable High Court, Andhra Pradesh
Income-tax Act, 1961	Income tax - Appeal against order u / s. 143(3) r.w.s. 153A	22.29⁽1&²⁾	2007-08	Income Tax Appellate Tribunal
Income-tax Act, 1961	Income tax - Appeal against order u / s. 143(3) r.w.s. 153A	27.25⁽¹&²⁾	2008-09	Income Tax Appellate Tribunal
Income-tax Act, 1961	Income tax	119.38⁽¹&²⁾	2007-08	The Hounourable High Court, Andhra Pradesh
Income-tax Act, 1961	Income tax	164.90⁽¹&²⁾	2008-09	The Hounourable High Court, Andhra Pradesh
Income-tax Act, 1961	Income tax - Appeal against order u / s. 143(3) r.w.s. 153A	92.61⁽¹&²⁾	2009-10	The Hounourable High Court, Madras
Income-tax Act, 1961	Income tax	141.38⁽¹&²⁾	2010-11	Income Tax Appellate Tribunal
Income-tax Act, 1961	Income tax	89.48⁽¹&²⁾	2011-12	Income Tax Appellate Tribunal
Income-tax Act, 1961	Income tax	97.67⁽¹&²⁾	2012-13	Income Tax Appellate Tribunal
Income-tax Act, 1961	Income tax	116.39⁽¹&²⁾	2013-14	Income Tax Appellate Tribunal
Income-tax Act, 1961	Income tax	1468.00⁽¹&²⁾	2007-08 To 2013-14	Income Tax Appellate Tribunal

(1) Represents gross tax liability. Out of this, a sum of Rs.4068.54 / - lakhs was paid as deposit / adjusted refund due.

(2) Excludes interest and penalty which are not ascertainable.

(3) Excludes interest and penalty.

(4) The company is in the process of filing appeal before CESTAT and due date for filling the appeal is not lapsed as on the date of this report.

(5) The company is in the process of filing appeal before Commissioner (Appeals) and due date for filling the appeal is not lapsed as on the date of this report.

(viii) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not defaulted in repayment of loans or borrowings to any financial institutions or banks.

(ix) During the year the Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loan. Accordingly paragraph 3(ix) of the order is not applicable.

(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year, nor we have been informed of such case by the management.

(xi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

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

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company transactions with the related parties are in compliance with sections 177 and 188 of the Act where ever applicable and the details of such transactions have been disclosed in the standalone Ind AS financial Statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable.

(xv) According to the information and explanations given to us and based on our examinations of the records of the Company the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly paragraph 3(xv) of the Order is not applicable.

(xvi) In our opinion and according to the information and explanations given to us, the company is not required to be registered under Section 45-IA of the Reserve Bank of India Act 1934. Accordingly, paragraph 3(xvi) of the Order is not applicable.

ANNEXURE B TO THE INDEPENDENT AUDITORSâ REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS

Report on the Internal Financial Controls over Financial Reporting under Clause (i) of sub-section (3) of section 143 of the Companies Act, 2013 (âthe Actâ)

We have audited the internal financial controls over financial reporting of BGR Energy Systems Limited (âthe Companyâ), as of March 31, 2018, in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

MANAGEMENTâS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Companyâs 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 (âICAIâ). 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 companyâs 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 Act.

AUDITORSâ RESPONSIBILITY

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

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorsâ judgment, including the assessment of the risks of material misstatement of the standalone Ind AS 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 Companyâs internal financial controls system over financial reporting.

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A companyâs 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 companyâs internal financial control over financial reporting includes those policies and procedures that:

(i) pertain to the maintenance of records that, in reasonable details, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs 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 March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For N R Doraiswami & Co

Chartered Accountants

Firm Registration No: 000771S

Suguna Ravichandran

Place: Chennai Partner

Date: May 30, 2018 Membership No: 207893

Mar 31, 2015

We have audited the accompanying standalone financial statements of BGR Energy Systems Limited ("the Company"), which comprise the Balance Sheet as at March 31,2015, the Statement of Profit and Loss, 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 & presentation 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITORS' RESPONSIBILITY

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on 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 March 31,2015, and its profit 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, 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, to the extent applicable.

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

d. 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 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 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 nos. 12.1, 12.2 and 35 to the standalone financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, and as required on long-term contracts including derivative contracts; and

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

The Annexure referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our Independent Auditors' Report to the members of BGR ENERGY SYSTEMS LIMITED for the year ended March 31,2015, we report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets; and

(b)The Company has a regular program of physical verification of its fixed assets by which fixed assets are verified in a phased manner on a rotation basis. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(ii) (a)The Management has conducted physical verification of inventory at reasonable intervals during the year;

(b) ln our opinion, the procedures of 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; and

(c) Based on our verification of the records, we are of the opinion that the Company is maintaining proper records of inventory. There are no material discrepancies noticed between book stock and physical stock on physical verification conducted by the management.

(iii) The Company has granted interest free unsecured loans to 5 parties covered in the register maintained under section 189 of the Act as on March 31,2015:

(a) In our opinion and on verification of the books of accounts, in respect of the above mentioned loans, there has been no regular repayment of the principal amount during the year; and

(b) ln our opinion, in respect of the above mentioned loans, reasonable steps have been taken by the Company for recovery of principal amount.

(iv) ln our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in aforesaid internal control system.

(v) The Company has not accepted any deposits from the public within the meaning of section 73 and 74 of the Act and the rules framed there under to the extent notified. Therefore, the provisions of clause (v) of the Companies (Auditor's Report) Order, 2015, are not applicable to the Company.

(vi) We have broadly reviewed the cost records maintained by the Company as specified by the Central Government under Section 148(1) of the Act and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) (a) In our opinion and according to the information given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees' State Insurance, Profession Tax, Income-tax, Sales- tax, Value Added Tax, Works Contract Tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues have generally been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us and on the basis of our examination of the records of the Company, no undisputed amounts payable in respect of Provident Fund, Employees' State Insurance, Profession Tax, Income-tax, Sales- tax, Value Added Tax, Works Contract Tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess were in arrears as at March 31, 2015, for a period of more than six months from the date they became payable;

(b)As per the information and explanations given to us, the following are the details of statutory dues which have not been deposited by the Company on account of disputes:

Name of the Statute Nature of the Dues Amount (Rs. in lakhs)

Central Sales Tax Central Sales Tax 4.20 Act, 1956

Central Sales Tax Central Sales Tax 35.03 Act, 1956

Andhra Pradesh Value Added Tax Act, 2005 Andhra Pradesh Sales Tax 0.12

Tamil Nadu General Sales Tamil Nadu Sales Tax 0.11 Tax Act, 1959

Tamil Nadu General Sales Tamil Nadu Sales Tax 2.21 Tax Act, 1959

Central Sales Tax Central Sales Tax 4.95* Act, 1956

Andhra Pradesh Value Andhra Pradesh VAT Act 0.52 Added Tax Act, 2005

Central Sales Tax Central Sales Tax 77.70* Act, 1956

Central Sales Tax Central Sales Tax 210.18*# Act, 1956

Andhra Pradesh Value Andhra Pradesh Sales Tax 1.49 Added Tax Act, 2005

Chapter V of Finance Service Tax 25.00$ Act, 1994

Andhra Pradesh Value Andhra Pradesh Sales Tax 3,179.83@ Added Tax Act, 2005

Central Sales Tax Central Sales Tax 194.77*# Act, 1956

Kerala Value Added Tax Kerala Sales Tax 2.65 Act, 2003

The Tamil Nadu Value Tamil Nadu Sales Tax 127.74* Added Tax Act, 2007

The Tamil Nadu Value Tamil Nadu Sales Tax 383.05* Added Tax Act, 2007

Andhra Pradesh Value Andhra Pradesh Sales Tax 118.43 Added Tax Act, 2005

Andhra Pradesh Value Andhra Pradesh Sales Tax 34.44 Added Tax Act, 2005

Andhra Pradesh Value Andhra Pradesh Sales Tax 3.45 Added Tax Act, 2005 ( Penalty)

Tamil Nadu Value Added Tamil Nadu Sales Tax 6.43* Tax Act, 2006

Tamil Nadu Value Added Tamil Nadu Sales Tax 4.18* Tax Act, 2006

Mines & Minerals Royalty 2,409.00# (Development & Regulations) Act, 1957

Income-tax Act, 1961 Income tax 192.15

Income-tax Act, 1961 Income tax 137.65

Income-tax Act, 1961 Income tax 141.67

Mines & Minerals (Develop-ment & Regulations) Act 1957 Royalty 1926.45#

Mines & Minerals (Develop-ment & Regulations) Act 1957 Royalty 211.45#

Income-tax Act, 1961 Income tax 7782.73*

The Employee Provident Fund & Miscella-neous Provision Act1952 Provident Fund 421.15

The Rajasthan Value Added Rajasthan Sales Tax 9,865.00$ Tax Act, 2003

The Rajasthan Value Added Rajasthan Sales Tax 9,541.00$ Tax Act, 2003

The Rajasthan Value Added Rajasthan Sales Tax 4,334.00$ Tax Act, 2003

Name of the Statute Financial Forum in which theAppeal is year lying in

Central Sales Tax 1997-98 The Honorable High Court, Act, 1956 Andhra Pradesh.

Central Sales Tax 1997-98 The Honorable High Court, Act, 1956 Andhra Pradesh.

Andhra Pradesh Value Added Tax Act, 2005 1998-99 Commercial Tax officer, Andhra Pradesh.

Tamil Nadu General Sales 1999-00 Commercial Tax officer, Tax Act, 1959 Tamil Nadu.

Tamil Nadu General Sales 2001-02 Sales Tax Appellate Tribunal, Tax Act, 1959 Chennai, Tamil Nadu.

Central Sales Tax 2004-05 Sales Tax Appellate Tribunal, Act, 1956 Vishakapatnam, Andhra Pradesh

Andhra Pradesh Value 2006-07 Sales Tax Appellate Tribunal, Added Tax Act, 2005 Vishakapatnam, Andhra Pradesh

Central Sales Tax 2006-07 Appellate Deputy Commissioner, Act, 1956 Kancheepuram, Tamil Nadu.

Central Sales Tax 2007-08 Appellate Deputy Commissioner, Act, 1956 Kancheepuram, Tamil Nadu.

Andhra Pradesh Value 2007-08 Sales Tax Appellate Tribunal, Added Tax Act, 2005 Vishakapatnam, Andhra Pradesh.

Chapter V of Finance 2007-08 CESTAT, Chennai, Tamil Nadu. Act, 1994

2006-07, Andhra Pradesh Value 2007-08 & Assistant Commissioner (CT) Added Tax Act, 2005 2008-09 LTU, Nellore, Andhra Pradesh.

Central Sales Tax 2008-09 Appellate Deputy Commissioner, Act, 1956 Kancheepuram, Tamil Nadu.

Kerala Value Added Tax 2006-07 The Deputy Commissioner Act, 2003 (Appeals), Ernakulam, Kerala

The Tamil Nadu Value 2009-10 The Appellate Deputy Added Tax Act, 2007 Commissioner (CT) North, Chennai.

The Tamil Nadu Value 2010-11 The Appellate Deputy Added Tax Act, 2007 Commissioner (CT) North, Chennai.

Andhra Pradesh Value 2008-09 The Appellate Deputy Added Tax Act, 2005 Commissioner. Guntur

Andhra Pradesh Value 2010-11 The Appellate Deputy Added Tax Act, 2005 Commissioner, Guntur.

Andhra Pradesh Value 2010-11 The Appellate Deputy Added Tax Act, 2005 Commissioner, Guntur.

Tamil Nadu Value Added 2008-09 The Appellate Deputy Tax Act, 2006 Commissioner (CT) North, Chennai.

Tamil Nadu Value Added 2009-10 The Appellate Deputy Tax Act, 2006 Commissioner (CT) North, Chennai.

Mines & Minerals 2009-10 The Honorable High Court, (Development & Rajasthan. Regulations) Act, 1957

Income-tax Act, 1961 2008-09 The Honorable High court, Andhra Pradesh

Income-tax Act, 1961 2006-07 The Honorable High Court, Andhra Pradesh

Income-tax Act, 1961 2007-08 The Honorable High Court, Andhra Pradesh

Mines & Minerals 2010-11 The Honorable High Court, (Develop-ment & Bombay. Regulations) Act 1957

Mines & Minerals 2010-11 The Honorable High Court, Bombay. (Develop-ment & Regulations) Act 1957

Income-tax Act, 1961 2009-10 Commissioner of income tax (Appeals), Guntur, Andhra Pradesh

The Employee Provident 2006-2010 The Honorable High Court, Fund & Miscella-neous Hyderabad Provision Act1952

The Rajasthan Value Added 2009-2010 Rajasthan Tax Board, Ajmer Tax Act, 2003

The Rajasthan Value Added 2010-2011 Rajasthan Tax Board, Ajmer Tax Act, 2003

The Rajasthan Value Added 2011-2012 Rajasthan Tax Board, Ajmer Tax Act, 2003

* Amount netted off with amount deposited

@ Interim Suspension has been received from the High Court

# Stay Order has been received against the amount disputed and not deposited

$ Excludes interest and penalty which are not ascertainable

(c) According to the information and explanations given to us and based on verification of the records, the amounts which required to be transferred to the Investor Education and Protection Fund has been transferred to such fund within the stipulated time in accordance with the relevant provisions of the Companies Act 1956 and the rules made there under.

(viii) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

(ix) According to the information and explanation given to us and on the basis of our examination of the books of account, the Company has not defaulted in repayment of dues to any financial institution or banks.

(x) The Company has given guarantee for loans taken by others from banks, the terms and conditions whereof, in our opinion, are not prejudicial to the interest of the Company.

(xi) The Company has availed a term loan during the year. As per the information and explanations provided to us and on basis of our examination of books of account, we are of the opinion that the existing and the new term loans were applied for the purpose for which they were availed.

(xii) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, 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 case by the management.

For Manohar Chowdhry & Associates Chartered Accountants Firm Registration Number: 001997S

M.S.N.M. Santosh Partner Membership Number: 221916 Place: Chennai Date: May 28, 2015

Mar 31, 2014

We have audited the accompanying financial statements of BGR Energy Systems Limited ("the Company"), which comprise the Balance sheet as at March 31, 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, 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, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

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

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT Annexure referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of the Independent Auditors'' Report to the Members of BGR ENERGY SYSTEMS LIMITED for the year ended March 31, 2014. We report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner on a rotation basis. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets; and

(c) In our opinion, the fixed assets disposed off during the year were not substantial and therefore, do not affect the going concern assumption.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year;

(b) In our opinion, the procedures of 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; and

(c) The Company is maintaining proper records of inventory. There are no material discrepancies noticed on physical verification between book stock and physical stock.

(iii) (a) The Company has granted interest free unsecured loans to 10 parties covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year- end-balance of these loans amounts to Rs. 3,052.01 lakhs and Rs. 1,835.94 lakhs respectively;

(b) In our opinion and according to the information and explanations given to us, the terms and conditions of the said loans are not prima facie prejudicial to the interest of the Company;

(c) In our opinion and on verification of the books of account, in respect of the above mentioned loans, there has been no regular repayment of the principal amount during the year;

(d) In our opinion, in respect of the above mentioned loans, reasonable steps have been taken by the Company for recovery of the principal amount due; and

(e) According to the information and explanations given to us, the Company has not availed any loans, secured or unsecured, from companies, firms or other parties covered in the register maintained under section 301 of the Act. In view of the foregoing, the provisions of clause 4(iii)(f) and 4(iii)(g) are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) (a) According to the information and explanations furnished by the 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 have been entered; and

(b) The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 4(vi) of the Order are not applicable to the Company.

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

(viii) We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) (a) In our opinion and according to the information given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including provident fund, employees'' state insurance, profession tax, income-tax, sales-tax, value added tax, works contract tax, wealth tax, service tax, customs duty, excise duty, cess and other statutory dues have generally been regularly deposited during the year by the company with the appropriate authorities. As explained to us, the Company did not have any dues on account of investor education and protection fund.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, profession tax, income-tax, sales-tax, value added tax, works contract tax, wealth tax, service tax, customs duty, excise duty, cess and other statutory dues were in arrears as at March 31, 2014 for a period of more than six months from the date they became payable; and

(b) According to the information and explanations given to us, the following are the details of statutory dues which have not been deposited by the Company on account of disputes:

Name of the Nature of Amount Period Forum where Statute the Dues (t in lakhs) to which dispute is the pending amount relates

Central Sales Central 39.23 1997-98 The Honorable Ta x Act, 1956 sales tax High Court,

Andhra Pradesh Value 0.12 1998-99 Commercial Tax Value Added Tax added Officer, Andhra Act, 2005 tax Pradesh

Tamil Nadu Value 0.11 1999-00 Commercial Tax Value Added Tax added Officer, Tamil Act, 2006 tax Nadu

Tamil Nadu Sales-tax 2.21 2001-02 Sales Tax General Sales Appellate Tribunal, Tax Act, 1959 Chennai, Tamil Nadu

Central Sales Central 4.95* 2004-05 Sales Tax Ta x Act, 1956 sales tax Appellate Tribunal, & penalty Visakhapatnam, Andhra Pradesh

Income-tax Act, Income 137.65* 2006-07 The Honorable 1961 tax & High Court, interest Andhra Pradesh

Andhra Pradesh Penalty 0.52 2006-07 Sales Tax Value Added Tax on value Appellate Tribunal, Act, 2005 added Visakhapatnam, tax Andhra Pradesh

Central Sales Central 77.70* 2006-07 Appellate Deputy tax Act, 1956 sales tax Commissioner, Kancheepuram, Tamil Nadu.

Kerala Value Value 2.65 2006-07 The Deputy Added Tax Act, added tax Commissioner 2003 & interest (Appeals), Ernakulum, Kerala

Income-tax Act, Income- 141.67* 2007-08 The Honorable 1961 tax and High Court, interest Andhra Pradesh

Andhra Pradesh Penalty 1.49 2007-08 Sales Tax Value Added Tax on value Appellate Tribunal, Act, 2005 added Visakhapatnam, tax Andhra Pradesh

Local Areas Act, Entry tax, 23.67 2007-08 Deputy 1999 interest & Commissioner penalty (Appeals), Ajmer, Rajasthan

Central Sales Central 210.18*# 2007-08 Appellate Deputy Tax Act, 1956 sales tax Commissioner, Kancheepuram, Tamil Nadu

Chapter V of Service 36.91 2007-08 Custom Excise Finance act, tax, & Service Ta x 1994 interest & Appellate Tribunal, penalty Chennai, Tamil Nadu

Income-tax Act, Income 192.15* 2008-09 The Honorable 1961 tax & High Court, interest Andhra Pradesh

Andhra Pradesh Value 3,179.83@ 2006-07, Assistant Value Added Tax added tax 2007-08 Commissioner Act, 2005 & penalty & 2008- (CT) LTU, Nellore, 09. Andhra Pradesh

Central Sales Central 194.77*# 2008-09 Appellate Deputy tax Act, 1956 sales tax Commissioner, Kancheepuram, Tamil Nadu

Income-tax Act, Income 7,782.73* 2009-10 Commissioner 1961 tax & of Income Ta x interest (Appeals), Guntur, Andhra Pradesh

Mines and Royalty 2,409.00# 2009-10 The Honorable Minerals High Court, (Development & Rajasthan Regulation) Act, 1957

Mines and Royalty 1,926.45# 2010-11 The Honorable Minerals High Court, (Development & Bombay Regulation) Act, 1957

Mines and Royalty 211.45# 2010-11 The Honorable Minerals High Court, (Development & Bombay Regulation) Act, 1957

* net of amounts paid under protest

# stay order has been received against the amount disputed and not deposited

@ Interim suspension has been received from the High Court

(x) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

(xi) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not defaulted in repayment of dues to any financial institution or bank.

(xii) In our opinion and according to information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures or other securities.

(xiii) The Company is not a chit fund / nidhi / mutual benefit fund / society. Accordingly, the provisions of clause 4(xiii) of the Order are not applicable to the Company.

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

(xv) The Company has given guarantee for loans taken by others from banks, the terms and conditions whereof, in our opinion, are not prejudicial to the interest of the Company.

(xvi) The Company has not availed any term loans during the year. According to the information and explanations given to us and on basis of our examination of books of account, we are of the opinion that the existing term loan was applied for the purpose for which the same was availed.

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

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

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

(xx) The Company has not raised any monies by way of public issue during the year. Accordingly, the provisions of clause 4(xx) of the Order are not applicable to the Company.

(xxi) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, 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 case by the management.

For Manohar Chowdhry & Associates Chartered Accountants Firm Registration No: 001997S

M S N M Santosh Partner Place: Chennai Membership No.221916 Date: May 30, 2014

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of BGR ENERGY SYSTEMS LIMITED ("the Company"), which comprises the Balance sheet as at March 31, 2013 and the Statement of Profit and Loss, and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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:

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

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("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, 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;

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 a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

Annexure referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of the Independent Auditors'' Report to the Members of BGR ENERGY SYSTEMS LIMITED for the year ended March 31, 2013. We report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The Company has conducted physical verification of fixed assets at reasonable intervals and no material discrepancies were noticed on such verification; and

(c) In our opinion, the fixed assets disposed off during the year were not substantial and therefore, do not affect the going concern assumption.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year;

(b) In our opinion, the procedures of 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; and

(c) The company is maintaining proper records of inventory. There are no material discrepancies noticed on physical verification between book stock and physical stock.

(iii) (a) The company has granted interest free unsecured loans to 11 parties covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year-end-balance of these loans amounts to Rs. 3,149.62 lakhs and Rs. 2,552.95 lakhs respectively;

b) In our opinion and as per the information and explanations given to us, the terms and conditions of the said loans are not prima facie prejudicial to the interest of the company;

(c) In our opinion and on verification of the books of account, in respect of the above mentioned loans, there has been no regular repayment of the principal amount during the year;

(d) In our opinion, in respect of the above mentioned loans, reasonable steps have been taken by the company for recovery of the principal amount due;

(e) According to the information and explanations given to us, the company has not availed any loans, secured or unsecured, from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. In view of the foregoing, the question of reporting on Clauses 4(iii)(f) and 4(iii) (g) of the said Order does not arise.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in aforesaid internal control system.

(v) (a) As per the information and explanation furnished by the 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 u/s. 301 have been entered; and

(b) The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and rules framed there under.

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

(viii) We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) (a) In our opinion and according to the information given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees'' State Insurance, Profession Tax, Income- tax, Sales-tax, Value Added Tax, Works Contract Tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues have generally been regularly deposited during the year by the company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Investor Education and Protection Fund.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Profession Tax, Income-tax, Sales-tax, Value Added Tax, Works Contract Tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess were in arrears as at March 31, 2013 for a period of more than six months from the date they became payable; and

(b) As per the information and explanations given to us, the following are the details of disputed statutory dues and the forum in which they are pending:

Financial Amount Type of statutory Forum in which the Appeal is year Rs. in lakhs dues lying in

1997-98 39.23 Central Sales Tax Honorable High Court, Andhra Pradesh.

1998-99 0.12 Sales Tax Commercial Tax officer, Andhra Pradesh.

1999-00 0.11 Sales Tax Commercial Tax officer, Tamilnadu.

2001-02 2.21 Sales Tax Sales Tax Appellate Tribunal, Chennai, Tamilnadu.

2004-05 5.57 Central Sales Tax Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh.

2006-07 2.59 Sales Tax Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh.

2006-07 157.14 Central Sales Tax Appellate Deputy Commissioner, Kancheepuram, Tamilnadu.

2006-07 2,915.49 Income Tax Income Tax Appellate Tribunal, Hyderabad, Andhra Pradesh.

2007-08 7.43 Sales Tax Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh.

2007-08 420.37 Central Sales Tax Appellate Deputy Commissioner, Kancheepuram, Tamilnadu. Stay has been granted by the Appellate Deputy Commissioner (CT)-V (FAC), Kanchipuram, Tamilnadu to the tune of Rs. 210.18 lakhs.

2007-08 3,779.69 Income Tax Income Tax Appellate Tribunal, Hyderabad, Andhra Pradesh

2007-08 36.91 Service Tax CESTAT, Chennai, Tamilnadu.

2006-07, 3,179.83 Sales Tax Assistant Commissioner (CT) LTU, 2007-08 & Nellore, Andhra Pradesh. 2008-09 Interim suspension has been granted by the High Court of Andhra Pradesh.

2008-09 389.54 Central Sales Tax Appellate Deputy Commissioner, Kancheepuram, Tamilnadu.

2008-09 23.67 Entry Tax Deputy Commissioner (Appeals), Ajmer, Rajasthan.

2008-09 4,799.66 Income Tax Income Tax Appellate Tribunal, Hyderabad, Andhra Pradesh.

2009-10 11,550.45 Income Tax Commissioner of Income Tax (Appeals), Guntur, Andhra Pradesh.

2009-10 2,400.10 Royalty Office of Assistant Mining Engineer, Rajasthan.

Stay has been granted by the Jaipur Bench, Rajasthan High Court.

2010-11 1,926.45 Royalty Office of Tahsildar, Saoner, Maharashtra.

Stay has been granted by the Nagpur Bench, Bombay High Court.

2010-11 211.45 Royalty Office of Tahsildar, Chandrapur, Maharashtra.

Stay has been granted by the Nagpur Bench, Bombay High Court.

Total 31,848.01

(x) The company does not have any accumulated losses at the end of the financial year. The company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

(xi) According to the information and explanation given to us and on the basis of our examination of the books of account, the company has not defaulted in repayment of dues to any financial institution or banks.

(xii) In our opinion and according to information and explanations given to us, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures or other securities.

(xiii) The company is not a chit fund / nidhi / mutual benefit fund / society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the company.

(xiv) The company is not dealing or trading in shares, securities, debentures and other investments.

(xv) The company has given guarantee for loans taken by others from banks, the terms and conditions whereof, in our opinion, are not prejudicial to the interest of the company.

(xvi) The Company has not availed any term loans during the year. As per the information and explanations provided to us and on basis of our examination of books of account, we are of the opinion that the existing term loan was applied for the purpose for which the same was availed.

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

(xviii) The company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

(xix) The company has not issued any debentures.

(xx) The company has not raised any monies by way of public issue during the year.

(xxi) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, 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 case by the management. For MANOHAR CHOWDHRY & ASSOCIATES

Chartered Accountants

Firm Registration No. 001997S

G.R. HARI

Place : Chennai Partner

Date : May 29, 2013 Membership No. 206386

Mar 31, 2012

1. We have audited the attached Balance Sheet of BGR ENERGY SYSTEMS LIMITED ('the Company') as at March 31, 2012, related Statement of Profit and Loss and Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We 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 (Auditors Report) Order, 2003 (the 'Order'), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 (the 'Act'), we enclose in the Annexure a Statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

c) The Balance Sheet, 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 Balance Sheet, Statement of Profit and Loss and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

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

f) 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 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 March 31, 2012;

(ii) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

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

ANNEXURE TO THE AUDITORS' REPORT

Annexure referred to in paragraph 3 of the Auditors' Report to the Members of BGR ENERGY SYSTEMS LIMITED for the year ended March 31, 2012. We report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The Company has conducted physical verification of fixed assets at reasonable intervals and no material discrepancies were noticed on such verification; and

(c) In our opinion, the fixed assets disposed off during the year were not substantial and therefore, do not affect the going concern assumption.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year;

(b) In our opinion, the procedures of 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; and

(c) The company is maintaining proper records of inventory. There are no material discrepancies noticed on physical verification between book stock and physical stock.

(iii) (a) The company has granted interest free unsecured loans to 10 parties covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year-end balance of these loans amounts to Rs. 6,347.99 Lakhs and Rs. 2,243.13 Lakhs respectively;

(b) In our opinion and as per the information and explanations given to us, the terms and conditions of the said loans are not prima facie prejudicial to the interest of the company;

(c) In our opinion and on verification of the books of account, in respect of the above mentioned loans, there has been no regular repayment of the principal amount during the year;

(d) In our opinion, in respect of the above mentioned loans, reasonable steps have been taken by the company for recovery of the principal amount due;

(e) According to the information and explanations given to us, the company has not availed any loans, secured or unsecured, from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. In view of the foregoing, the question of reporting on Clauses 4(iii)(f) and 4(iii)(g) of the said Order does not arise.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in aforesaid internal control system.

(v) (a) As per the information and explanation furnished by the 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 u/s. 301 have been entered; and

(b) The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has not accepted any deposits from the public within the meaning of sections 58A, 58AA or any of the relevant provisions of the Act and rules framed there under.

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

(viii) We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) (a) In our opinion and according to the information given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees' State Insurance, Profession Tax, Income-tax, Sales-tax, VAT, Works Contract Tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues have generally been regularly deposited during the year by the company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Investor Education and Protection Fund.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees' State Insurance, Profession Tax, Income-tax, Sales-tax, VAT, Works Contract Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess were in arrears as at March 31, 2012 for a period of more than six months from the date they became payable; and

(b) As per the information and explanations given to us, the following are the details of disputed statutory dues and the forum in which they are pending :

Financial Amount Type of Forum in which the Appeal is year Rs.in Lakhs statutory lying in dues

1997-98 39.23 Sales Tax Honorable High Court, Andhra Pradesh

Commercial Tax officer, Andhra 1998-99 0.12 Sales Tax Pradesh

Commercial Tax officer, 1999-00 0.11 Sales Tax Tamilnadu

2001-02 2.21 Sales Tax Sales Tax Appellate Tribunal, Tamilnadu

Sales Tax Appellate Tribunal, 2004-05 5.57 Sales Tax Vishakapatnam, Andhra Pradesh

2005-06 9.95 Sales Tax Appellate Deputy Commissioner, Guntur, Andhra Pradesh

2005-06 39.98 Sales Tax Deputy commissioner, Appeals, Ernakulam, Kerala

2005-06 16.96 Central Sales Tax Appellate Tribunal, Sales Tax Vishakapatnam, Andhra Pradesh

Sales Tax Appellate Tribunal, 2006-07 2.59 Sales Tax Vishakapatnam, Andhra Pradesh

2006-07 2.69 Sales Tax Appellate Deputy Commissioner, Guntur, Andhra Pradesh

Income Tax Appellate Tribunal, 2006-07 2915.49 Income Tax Hyderabad

Sales Tax Appellate Tribunal, 2007-08 7.43 Sales Tax Vishakapatnam, Andhra Pradesh

Appellate Deputy Commissioner, 2007-08 2.11 Sales Tax Guntur, Andhra Pradesh

Income Tax Appellate Tribunal, 2007-08 3779.69 Income Tax Hyderabad

Assistant Commissioner (CT) 2006-07 LTU, Nellore, Andhra Pradesh.

2007-08 & 3179.83 Sales Tax Interim suspension has been granted by the High Court of 2008-09 Andhra Pradesh.

2008-09 23.67 Entry Tax Deputy Commissioner (Appeals), Ajmer, Rajasthan

2008-09 110.48 Sales Tax Deputy Commissioner Appeal, Ajmer, Rajasthan

Office of Tahsildar, Saoner, Maharashtra. 2010-11 1926.45 Royalty Stay has been granted by the Nagpur Bench, Bombay High Court.

Office of Tahsildar,Chandrapur, Maharashtra 2010-11 211.45 Royalty Stay has been granted by the Nagpur Bench, Bombay High Court.

Total 12,276.01

(x) The company does not have any accumulated losses at the end of the financial year. The company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information given to us, the company has not defaulted in repayment of dues to any financial institution or banks.

(xii) In our opinion and according to the 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 or other securities.

(xiii) The company is not a chit fund / nidhi / mutual benefit fund / society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the company.

(xiv) The company is not dealing or trading in shares, securities, debentures and other investments.

(xv) The company has given guarantee for loans taken by others from banks, the terms and conditions whereof, in our opinion, are not prejudicial to the interest of the company.

(xvi) During the year, the company has availed term loan for acquiring various fixed assets. As per the information and explanations provided to us, we are of the opinion that the same was applied for the purpose for which it was availed.

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

(xviii) The company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

(xix) The company has not issued any debentures.

(xx) The Company has not raised any monies by way of public issues during the year.

(xxi) Based on the audit procedures performed and on the basis of information given to us, we report that no fraud by the company has been noticed or reported during the year. An instance of fraud on the Company by certain employees has been reported and the Company has filed a police complaint in this regard - refer to note number 42 of Notes to Financial Statements.

For MANOHAR CHOWDHRY & ASSOCIATES

Chartered Accountants

Firm Registration No. 001997S

G.R. HARI

Place : Chennai Partner

Date : May 30, 2012 Membership No. 206386

Mar 31, 2011

1. We have audited the attached Balance Sheet of BGR ENERGY SYSTEMS LIMITED as at March 31, 2011 and the related Profit and Loss account and Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the CompanyÃs 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 signifcant 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 (Auditors Report) Order, 2003 (the ÃOrderÃ), as amended, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 (the ÃActÃ), we enclose in the Annexure a Statement on the matters specifed in paragraphs 4 and 5 of the said Order.

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

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

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

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

d) In our opinion, the Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act;

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

f) In our opinion, there were no dues on account of cess under Section 441A of the Act, since the aforesaid section has not yet been made effective by the Central Government of India as on March 31, 2011; and

g) 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 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 March 31, 2011;

(ii) in the case of the Profit and Loss account, of the Profit for the year ended on that date; and

(iii) in the case of the cash fow statement, of the cash fows for the year ended on that date.

ANNEXURE TO THE AUDITORSÃ REPORT

Annexure referred to in paragraph 3 of the AuditorsÃ Report to the Members of BGR ENERGY SYSTEMS LIMITED for the year ended March 31, 2011. We report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fxed assets;

(b) The Company has conducted physical verifcation of fxed assets at reasonable intervals and no material discrepancies were noticed on such verifcation; and

(c) In our opinion, the fxed assets disposed off during the year were not substantial and therefore, do not affect the going concern assumption.

(ii) (a) The management has conducted physical verifcation of inventory at reasonable intervals during the year;

(b) In our opinion, the procedures of physical verifcation of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business; and

(c) The Company is maintaining proper records of inventory. There are no major material discrepancies noticed on physical verifcation between book stock and physical stock.

(iii) (a) The Company has granted interest free unsecured loans to 6 parties covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year and the year-end-balance of these loans amounts to Rs. 1,432.45 lakhs and Rs. 1,418.33 lakhs respectively;

(b) In our opinion and as per the information and explanations given to us, the terms and conditions of the said loans are not prima facie prejudicial to the interest of the company;

(c) In our opinion and on verifcation of the books of account, in respect of the above mentioned loans, there has been no regular repayment of the principal amount during the year;

(d) In our opinion, in respect of the above mentioned loans, reasonable steps have been taken by the company for recovery of the principal amount due. The outstanding principal amount as on March 31, 2011 is Rs. 1,418.33 lakhs;

(e) According to the information and explanations given to us, the Company has not availed any loans, secured or unsecured, from companies, frms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the foregoing, the question of reporting on Clauses 4(iii)(f) and 4(iii)(g) of the said Order does not arise.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fxed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in aforesaid internal control system.

(v) (a) As per the information and explanations furnished by the 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 u/s. 301 have been entered; and

(b) The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from the public within the meaning of Sections 58A, 58AA or any of the relevant provisions of the Act and rules framed thereunder.

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

(viii) There is no order or notifcation by the Central Government prescribing maintenance of cost records by the Company u/s. 209 (1)(d) of the Companies Act, 1956.

(ix) (a) In our opinion and according to the information given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, EmployeesÃ State Insurance, Profession Tax, Income-tax, Sales-tax, VAT, Works Contract Tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues have generally been regularly deposited during the year by the company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Investor Education and Protection Fund.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, EmployeesÃ State Insurance, Profession Tax, Income-tax, Sales-tax, VAT, Works Contract Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess were in arrears as at March 31, 2011 for a period of more than six months from the date they became payable; and

(b) As per the information and explanations provided to us, the following are the details of Disputed Tax Liabilities and the forum in which they are pending:

Financial amount Type of Tax Forum in which the year Rs. in Liability appeal is lying in lakhs

1997-98 39.23 Sales Tax Honorable High Court, Andhra Pradesh

1998-99 0.12 Sales Tax Commercial Tax Officer, Andhra Pradesh

1999-00 0.11 Sales Tax Commercial Tax Officer, Tamilnadu

2001-02 2.21 Sales Tax Sales Tax Appellate Tribunal, Tamilnadu

2004-05 5.57 Sales Tax Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh

2005-06 9.95 Sales Tax Appellate Deputy Commissioner, Guntur, Andhra Pradesh

2005-06 16.96 Central Sales Sales Tax Appellate Tax Tribunal, Vishakapatnam, Andhra Pradesh

2005-06 39.98 Sales Tax Deputy Commissioner Appeals, Ernakulam, Kerala

2006-07 2.59 Sales Tax Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh

2006-07 2.69 Sales Tax Appellate Deputy Commissioner, Guntur, Andhra Pradesh

2007-08 7.43 Sales Tax Sales Tax Appellate Tribunal, Vishakapatnam, Andhra Pradesh

2007-08 41.75 Service Tax Commissioner Appeals, Central Excise, Chennai, Tamilnadu

2007-08 19.37 Sales Tax Appellate Deputy Commissioner, Kota, Rajasthan

2007-08 2.11 Sales Tax Appellate Deputy Commissioner, Guntur, Andhra Pradesh

2007-08 3779.69 Income Tax Commissioner Appeals, Guntur, Andhra Pradesh

2008-09 13.17 Entry Tax Honorable High Court of Rajasthan

(x) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

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

(xii) In our opinion and according to the 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 or other securities.

(xiii) The Company is not a chit fund/nidhi/mutual beneft fund/ society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the Company.

(xiv) The Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) The Company has given guarantee for loans taken by others from banks or financial institutions, the terms and conditions whereof, in our opinion, are not prejudicial to the interest of the Company.

(xvi) During the year, the Company has availed term loans for acquiring various fxed assets. As per the information and explanations provided to us, we are of the opinion that these loans were applied for the purpose for which the same were availed.

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

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act.

(xix) The Company has not issued any debentures.

(xx) The Company has raised net proceeds of Rs. 19012 lakhs by way of initial public offering (IPO) during the year ended March 31, 2008. During the year, the Company has utilized the balance proceeds of Rs. 6512 lakhs towards augmenting working capital requirements being one of the objects of issue. The Company has disclosed the end use of money by way of notes to accounts in point 18 of Schedule 14 B.

(xxi) Based on the audit procedures performed and on the basis of information and explanations given to us, we report that no fraud by the Company has been noticed or reported during the year. However, an instance of theft of Intellectual property, information and data has been reported, as referred to in note 20 of notes to accounts in Schedule 14B.

For MANOHAR CHOWDHRY & ASSOCIATES

Chartered Accountants

FR No: 001997S

G R HaRI

Place : Chennai Partner

Date : May 26, 2011 M.No. 206386

Mar 31, 2010

1. We have audited the attached Balance Sheet of BGR ENERGY SYSTEMS LIMITED as at 31st March 2010 and the related Profit and Loss account and Cash Flow Statement 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 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 (Auditors Report) Order, 2003 (the Order), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 (the Act), we enclose in the Annexure a Statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

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

d) In our opinion, the Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

e) On the basis of the 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 are disqualified as on 31st March 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act;

f) In our opinion, there were no dues on account of cess under section 441A of the Act, since the aforesaid section has not yet been made effective by the Central Government of India as on 31st March 2010; and

g) 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 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 31st March 2010;

(ii) in the case of the Profit and Loss account, of the profit for the year ended on that date; and

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

ANNEXURE TO THE AUDITORS REPORT

Annexure referred to in paragraph 3 of the Auditors Report to the Members of BGR ENERGY SYSTEMS LIMITED for the j year ended 31 st March 2010. We report that:

(i) (a) The Company is maintaining proper records i showing full particulars, including quantitative details and situation of fixed assets;

(b) The Company has conducted physical verification of fixed assets at reasonable intervals and no material discrepancies were noticed on such verification; and

(c) lnouropinion,thefixedassetsdisposedoffduring the year were not substantial and therefore, do not affect the going concern assumption.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals , during the year;

(b) In our opinion, the procedures of 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; and

(c) The company is maintaining proper records of inventory. There are no major material discrepancies noticed on physical verification between book stock and physical stock.

(iii) (a) The company has granted interest free unsecured loans to 6 parties covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year-end-balance of these loans amounts to Rs. 1973 lakhs and Rs.1719 lakhs respectively;

(b) In our opinion and as per the information and explanations given to us, the terms and conditions of the said loans are not prima facie prejudicial to the interest of the company;

(c) In our opinion and on verification of the books of account, in respect of the above mentioned loans, there has been no regular repayment of the principal amount during the year;

(d) In our opinion, in respect of the above mentioned loans, reasonable steps have been taken by the company for recovery of the principal amount due. The outstanding principal amount as on 31st March 2010 is Rs.1719 lakhs;

(e) The company has availed interest free unsecured loan from 1 party covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year-end-balance of such loan amounts to Rs. 318 lakhs and Rs.33 lakhs respectively;

(f) In our opinion, the terms and conditions of the loans availed are not prejudicial to the interest of the company; and

(g) In our opinion and on verification of the books of account, in respect of the above mentioned loan, there has been no regular repayment of the principal amount during the year;

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in aforesaid internal control system.

(v) (a) As per the information and explanation furnished by the 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 u/s. 301 have been entered; and

(b) The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has not accepted any deposits from the public within the meaning of sections 58A, 58AA or any of the relevant provisions of the Act and rules framed there under.

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

(viii) There is no order or notification by the Central Government prescribing maintenance of cost records by the Company u/s.209 (1)(d) of the Companies Act, 1956.

(ix) (a) In our opinion and according to the information given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees State Insurance, Profession Tax, Income-tax, Sales-tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues have generally been regularly deposited during the year by the company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Investor Education and Protection Fund.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Profession Tax, Income-tax, Sales-tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess were in arrears as at 31 st March 2010 for a period of more than six months from the date they became payable; and

(b) As per the information and explanations provided to us, the following are the details of Disputed Tax Liabilities and the forum in which they are pending:

Financial Amount Type of Tax Forum in which the

year (Rs. in Lakhs) Liability Appeal is lying in

1997 - 98 39.23 Sales Tax Honorable High

Court, Andhra

Pradesh

1998-99 0.12 Sales Tax Commercial Tax

Officer, Andhra

Pradesh

1999-00 0.11 Sales Tax Commercial Tax

Officer, Tamilnadu

2001-02 2.21 Sales Tax Appellate Assistant

Commissioner,

Kancheepuram,

Tamil Nadu

2004-05 5.57 Sales Tax Sales Tax

Appellate Tribunal,

Vishakapatnam,

Andhra Pradesh

2005-06 16.96 Central Sales Tax

Sales Tax Appellate

Tribunal, Vishakapatnam,

Andhra Pradesh

2005-06 39.98 Sales Tax Deputy

Commissioner Appeals,

Ernakulum, Kerala

2006-07 2.59 Sales Tax Sales Tax Appellate

Tribunal, Vishakapatnam,

Andhra Pradesh

2006-07 2915.49 Income tax Commissioner of Income tax

(Appeals), Guntur

2007-08 7.43 Sales Tax Sales Tax

Appellate Tribunal,

Vishakapatnam,

Andhra Pradesh

2007-08 63.89 Sales Tax Honorable High

Court, Kerala

2007-08 32.41 Service Tax Commissioner

Appeals, Central Excise,

Chennai,

Tamil Nadu

TOTAL 3125.99

(x) The company does not have any accumulated losses at the end of the financial year. The company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information given to us, the company has not defaulted in repayment of dues to any financial institution or banks.

(xii) In our opinion and according to the 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 or other securities.

(xiii) The company is not a chit fund / nidhi / mutual benefit fund / society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the company.

(xiv) The company is not dealing or trading in shares, securities, debentures and other investments.

(xv) The company has given guarantee for loans taken by others from banks or financial institutions, the terms and conditions whereof, in our opinion, are not prejudicial to the interest of the company.

(xvi) During the year, the company has availed term loans for acquiring various fixed assets. As per the information and explanations provided to us, we are of the opinion that these loans were applied for the purpose for which the same were availed.

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

(xviii) The company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

(xix) The company has not issued any debentures.

(xx) The Company has raised net proceeds of Rs. 19,012 lakhs by way of initial public offering (IPO) during the year ended 31st March 2008. Out of this, the Company has utilized Rs. 12,500 lakhs towards augmenting working capital requirements, being one of the objects of issue of IPO, during the year ended 31st March 2010. Balance of net proceeds of initial public offering amounting to Rs. 6,512 lakhs are held as fixed deposits with banks pending utilization towards other objects of the issue as on 31.03.2010. The Company has disclosed the end use of money by way of notes to accounts in point 18 of schedule 14 B.

(xxi) In our opinion and according to explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

For MAIMOHAR CHOWDHRY & ASSOCIATES

Chartered Accountants

G R HARI

Place : Chennai Partner

Date : May 28, 2010 M.No. 206386

FR No. 001997S

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