Auditor Report of Bilpower Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of Bilpower Limited ("the Company"), which comprise the Balance Sheet as at March 31,2014, the Statement of Profit and Loss and Cash Flow Statement for the year 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 Principles generally accepted in India including Accounting Standards referred to in Section 2II(3C) of the Companies Act, 1956 ("the Act") (which continue to be applicable in respect of section 133 of the Companies Act, 2013 in terms of general circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs). 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 misstatements.

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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal 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 qualified audit opinion.

Basis for Qualified Opinion

1) With regard to the preparation of financial statements on going concern

The financial statements of the company have been prepared on a going concern basis, notwithstanding the fact that its net worth is fully eroded due to high losses for the financial years 2011-2012, 2012-2013 and 2013-2014. The appropriateness of the said basis is interalia dependent on the company''s ability to infuse requisite funds for meeting its obligations, rescheduling of debt and resuming normal operations.

2) With regard to pending confirmation of balances

The company has sent letters to customers in respect of trade receivables for confirming balances outstanding as at March 31, 2014, but in most of the cases the customers have not sent written confirmation confirming the balance outstanding as at March 31, 2014. In the absence of confirmation any provision to be made for adverse variation in the carrying amounts of trade receivables is not quantified.

3) Regarding non provision of Interest on various loans availed from State Bank of India for the financial year 2013-14

The company has not provided for interest payable to State Bank of India amounting to Rs. 2341.46 lacs (on various loans from State Bank of India)for the financial year 2013-2014. The company has also not made any provision for penal interest claimed by bank. As a result the loss for the year ended 31st March, 2014 is understated by Rs. 2341.46 Lacs & current liabilities as at 31st March, 2014 are also understated by Rs. 2341.46 Lacs. The amount of penal interest cannot be quantified as the details have not been received from the bank.

4) Regarding non provision of demand of Rs. 84.69 Crores received from State Bank of India in respect of Corporate Guarantee given by the company in respect of Loan Facilities availed by Bil Energy Systems Limited

The lender Bank of Bil Energy Systems Limited has pursuant to certain corporate guarantees given by the company demanded from the company their dues from Bil Energy Systems Limited amounting to Rs. 84.69 crores. No provision has been made in the accounts for the probable loss that may arise on account of above demand of Rs. 84.69 crores.

Qualified Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 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 Companies Act, 1956 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) Except for the effects of the matters described in the Basis for Qualified Opinion Paragraph, 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 Section 2II(3C) of the Companies Act, 1956; (which continue to be applicable in respect of section 133 of the Companies Act, 2013 in terms of general circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs)

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 of Section 274(l)(g) of the Companies Act, 1956.

ANNEXURE TO INDEPENDENT AUDITORS REPORT

Referred to in paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date

1. In respect of fixed assets:

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

(b) As explained to us, fixed assets have been physically verified by the management at reasonable intervals. However such physical report has not been made available to us during the course of our audit. It is explained that no material discrepancy has been reportedly noticed on such verification.

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

2. In respect of inventories:

(a) As explained to us that inventory has been physically verified during the year by the management. However such physical verification report has not been made available to us during the course of our audit. Hence we are unable to comment on the reasonableness of frequency and procedure of the verification of inventory. However, inventories have also been audited by independent auditors appointed by lending banks and also by bank officials from time to time and no adverse opinion has been given by the said auditors and officials.

(b) The Company has maintained proper book records of inventory. Packing and sample material and stores and spares purchased are written off as expenses in the year of purchase.

3. (a) The Company has granted interest free unsecured loans, to four parties listed in the register maintained under Section 301 of the Companies Act, 1956.

The maximum amount involved during the year and the year end balance of such loans aggregate to Rs. 2,91,07,292/- and Rs. 2,44,94,133.31 respectively.

(b) Except for the fact that these loans are interest free, in our opinion and according to the information and explanations given to us, the other terms and conditions of loans given are not prima facie prejudicial to the interest of the Company.

(c) The principal amount is repayable over a period of two years.

(d) In respect of the aforesaid loans, there is no overdue amount.

(e) The Company has taken interest free loans from three parties listed in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year end balance of such loans aggregate to Rs. 1,54,63,935/- and Rs. Nil respectively.

(f) The said loans are interest free loans. The other terms and conditions of loans taken are not prima facie prejudicial to the interest of the Company.

(g) No stipulations for repayment have been prescribed and as such no comments regarding regularity of payments are being made.

4. In our opinion, and according to the Information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods, keeping in view the close supervision and authorization by the directors. During the course of our audit, we have not observed any major weaknesses in internal control system.

5. In respect of contractor arrangements referred to in section 301 of the Companies Act, 1956

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of the contracts /arrangements entered in the Register maintained under section 301 of the Companies Act 1956 and exceeding the value of Rupees Five Lacs in respect of the each party during the year have been made at prices which are reasonable having regards to the prevailing market price at the relevant time.

6. As explained to us, during the year under reference the Company has not accepted any Deposits from the Public within the meaning of Provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed thereunder. Therefore, the provision of clause (vi) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the company

7. As explained to us, the Company has an internal audit system commensurate with the size and nature of its business, however, report of such internal audit has not been made available to us.

8. 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.

9. a) Undisputed Statutory dues in respect of Service tax, Sales tax, Profession tax, Tax deducted at source and Wealth Tax have not been regularly deposited with the appropriate authorities. Undisputed statutory dues in respect of Provident fund, Customs, Excise Duty, Cess as applicable have generally been regularly deposited with the appropriate authorities barring few months.

b) According to the information and explanations given to us:

(i) No amounts were outstanding as at year end on account of undisputed amounts payable in respect of investor education and protection fund, customs duty, excise duty and cess, service tax, tax deducted at source for a period of more than 6 months from the date they became payable.

(ii) Undisputed amounts payable in respect of Sales Tax of Rs. 36,29,813/- (relating to Financial year 2011-12 Rs. 22,11,434/-, & relating to financial year 2012-13 Rs. 14,18,379/-), Interest on Sales Tax of Rs. 35,79,380/- (relating to Financial year 2010-11 Rs. 15,82,310/-, relating to financial year 2011-12 Rs. 16,95,665/- & relating to financial year 2012-13 Rs. 3,01,405/-), Profession Tax Rs. 1,400/- (relating to financial year 2012-13), Professional Tax payable Rs. 4,000/-(relating to financial year 2012-13 Rs. 3,000/- & relating to financial year 2013-14 Rs. 1,000/-) Tax on Proposed Dividend of Rs. 17,03,492/- (relating to dividend paid in financial year 2011-12 for dividend declared pertaining to financial year 2010-11) and Labour Welfare Fund payable Rs. 24/- (relating to financial year 2012-13 Rs. 6/- & relating to financial year Rs. 18/-) were outstanding for a period of more than six months from the date they became payable. The due dates for these amounts are as per the respective statutes.

c) The disputed statutory dues aggregating to Rs. 4442.37 Lacs that have not been deposited, on account of matters pending before appropriate authorities are as under :-

Sr. Name of Nature Period for which No. the Statute of dues the amount relates

1 Central Excise F.Y.2008-09 & Excise Act Duty F.Y.2009-10 2 Central Excise F.Y.2008-09 & Excise Act Duty F.Y.2009-10

Maharashtra Value F.Y. 2006-07 & 3 Sales Tax Added Tax and F.Y. 2009-10 Central Sales Tax

Sr. Name of Amt No. the Statute Forum where dispute is pending (Rs. in Lacs)

1 Central The company''s appeal has been Excise Act dismissed by The Customs Excise & Service Tax appellate 4071.80 tribunal- Ahmedabad. The company has informed us that they have preferred an appeal with Bombay High Court.

2 Central Excise Act The Customs Excise & Service Tax appellate tribunal- Ahmedabad 255.98

3 Sales Tax The Deputy Comm. of Sales Tax Appeal V, Mumbai 114.59 Total 4442.37

10. The Company''s accumulated losses at the end of the financial year were more than fifty percent of its net worth. The Company has incurred cash losses in the financial year and in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanation given to us by the management, the company has defaulted in repayment of loans and interest to bank. The company has defaulted in repayment of dues including interest and principal to State Bank of India, on its various fund factilities availed, outstanding at the year end amounting to Rs. 180.00 Crores (Previous Year overdue Rs. 0.24 Crores). The unpaid interest provided for in the books of accounts on the said loans amounts to Rs. 6.85 Crores (Previous Year Rs. 5.04 Crores). Also interest not provided amounting to Rs. 23.42 Crores for the financial year 2013-14 as stated in note 6.1 (d) of notes to accounts of Balance Sheet , is remaining unpaid. Entire loans have been recalled by State Bank Of India during the financial year 2013-2014

12. According to the information and explanations given to us, no loans & Advances have been granted by the company on the basis of the securities by way of pledge of shares, debentures and other securities.

13. In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provision of clause (xiii) of paragraph 4 of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

14. In respect of the dealings in shares and other securities, proper records have been maintained and timely entries have been made therein.

All these securities have been held by the company in its own name.

15. According to the information and explanation given to us the Company has given guarantee for loans taken by one Associate company from bank. According to the information & explanation given to us, we are of the opinion that the terms & conditions thereof are not prima facie prejudicial to the interest of the company.

16. Based on our audit procedures and on the information given by the management, we report that the company has not raised any term loans during the year.

17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31st March, 2014, we report that no funds raised on short-term basis have been used for long-term investment by the Company.

18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year.

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

20. Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management.

For Bansal Bansal & Co. Chartered Accountants Firm Regn. No. 100986W

Anand Drolia Partner Mumbai, 28th May, 2014 Membership No. 036718

---

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Bilpower Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, 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 Principles generally accepted in India including Accounting Standards referred to in Section 21 I(3C) of the Companies Act, I956 ("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 misstatements.

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 qualified audit opinion.

Basis for Qualified Opinion

1) With regard to the preparation of financial statements on going concern

The financial statements of the company have been prepared on a going concern basis, notwithstanding the fact that its net worth is substantially eroded due to high losses for the financial years 20II-20I2 and 20I2-20I3. The appropriateness of the said basis is interlaid dependent on the company''s ability to infuse requisite funds for meeting its obligations, rescheduling of debt and resuming normal operations.

2) With regard to pending confirmation of balances

The company has sent letters to customers in respect of trade receivables for confirming balances outstanding as at March 3I, 20I3, but in most of the cases the customers have not sent written confirmation confirming the balance outstanding as at March 3I, 20I3. In the absence of confirmation any provision to be made for adverse variation in the carrying amounts of trade receivables is not quantified.

3) Recognition of Deferred Tax Credit in contravention of Accounting Standard 22 on ''Accounting for Taxes on Income''

The company has recognized Deferred Tax Asset on account of unabsorbed losses and allowances during the year aggregating to Rs. 684890I.05 (For year ended March 3I, 20I2 - NIL)( Total amount recognized up to March 3I,20I3 Rs. 684890I.05). This does not satisfy the virtual certainty test for recognition of deferred tax credit as laid down in Accounting Standard 22

Qualified Opinion

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

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 3I, 20I3;

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

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

Report on Other Legal and Regulatory Requirements

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

ruwcn Duninu ruwcn

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) Except for the effects of the matters described in the Basis for Qualified Opinion Paragraph, 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 Section 2II(3C) of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on March 3I, 20I3, and taken on record by the Board of Directors, none of the directors is disqualified as on March 3I, 20I3, from being appointed as a director in terms of clause of Section 274(I)g of the Companies Act, I956.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 44IA of the Companies Act, I956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

1. In respect of fixed assets:

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

(b) As explained to us, fixed assets have been physically verified by the management at reasonable intervals. However such physical report has not been made available to us during the course of our audit. It is explained that no material discrepancy has been reportedly noticed on such verification.

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

2. In respect of inventories:

(a) As explained to us that inventory has been physically verified during the year by the management. However such physical verification report has not been made available to us during the course of our audit. Hence we are unable to comment on the reasonableness of frequency and procedure of the verification of inventory. However, inventories have also been audited by independent auditors appointed by lending banks and also by bank officials from time to time and no adverse opinion has been given by the said auditors and officials.

(b) The Company has maintained proper book records of inventory. Packing and sample material and stores and spares purchased are written off as expenses in the year of purchase.

3. (a) The Company has granted interest free unsecured loans, to three parties listed in the register maintained under Section 30I of the Companies Act, I956.

The maximum amount involved during the year and the yearend balance of such loans aggregate to Rs. 43274938/- and Rs. 254I8367/- respectively.

(b) Except for the fact that these loans are interest free, in our opinion and according to the information and explanations given to us, the other terms and conditions of loans given are not prima facie prejudicial to the interest of the Company.

(c) The principal amount is repayable over a period of two years.

(d) In respect of the aforesaid loans, there is no overdue amount.

(e) The Company has taken interest free loans from two parties listed in the register maintained under Section 30I of the Companies Act, I956. The maximum amount involved during the year and the year end balance of such loans aggregate to Rs. I536II92/- and Rs. I536II92/- respectively.

(f) The said loans are interest free loans. The other terms and conditions of loans taken are not prima facie prejudicial to the interest of the Company.

(g) No stipulations for repayment have been prescribed and as such no comments regarding regularity of payments are being made.

4. In our opinion, and according to the Information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods, keeping in view the close supervision and authorization by the directors. During the course of our audit, we have not observed any major weaknesses in internal control system.

5. In respect of contractor arrangements referred to in section 30I of the Companies Act, I956

(a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of the contracts or arrangements that need to be entered in the register maintained under section 30I of the Companies Act, I956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of the contracts /arrangements entered in the Register maintained under section 30I of the Companies Act I956 and exceeding the value of Rupees Five Lacs in respect of the each party during the year have been made at prices which are reasonable having regards to the prevailing market price at the relevant time.

6. As explained to us, during the year under reference the Company has not accepted any Deposits from the Public within the meaning of Provisions of Section 58A and 58AA of the Act and the rules framed there under. Therefore, the provision of clause (vi) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the company

7. As explained to us, the Company has an internal audit system commensurate with the size and nature of its business, however, report of such internal audit has not been made available to us.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 20II prescribed by the Central Government under Section 209 (I) (d) of the Companies Act, I956 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.

9. a) Undisputed Statutory dues in respect of Service tax, Sales tax, Profession tax, Tax deducted at source and Wealth Tax have not been regularly deposited with the appropriate authorities. Undisputed statutory dues in respect of Provident fund, Customs, Excise Duty, Cess as applicable have generally been regularly deposited with the appropriate authorities barring few months.

b) According to the information and explanations given to us:

(i) No amounts were outstanding as at year end on account of undisputed amounts payable in respect of investor education and protection fund, customs duty, excise duty and cess, service tax, tax deducted at source for a period of more than 6 months from the date they became payable.

(ii) Undisputed amounts payable in respect of Sales Tax of Rs. 363I8I3/- (relating to Financial year 20II-I2 - Rs. 22II434/- & relating to financial year 20I2-I3 - Rs. I420379/-), Interest on Sales Tax of Rs. 3II2II7/- (relating to Financial year 20I0-II - Rs. I5823I0/- & relating to financial year 20II-I2 - Rs. I529807/-), Profession Tax Rs. I400/- (relating to financial year 20I2-I3), Tax on Proposed Dividend of Rs. I703492/- (relating to dividend paid in financial year 20II-I2 for dividend declared pertaining to financial year 20I0-II) and Wealth Tax Rs. 8I925/ - (relating to financial year 2008-09) were outstanding for a period of more than six months from the date they became payable. The due dates for these amounts are as per the respective statutes.

c) The disputed statutory dues aggregating to Rs. 4427.78 Lacs that have not been deposited, on account of matters pending before appropriate authorities are as under :-

Sr. Name of Nature Period for which the Amt Forum where dispute is pending No. the Statute of dues amount relates (Rs. in Lacs)

The company''s appeal has been dis missed by The Customs Excise &

1 Central Excise F.Y. 2008-09 & Service Tax appellate tribunal - Ahmedabad. The company has in formed 4I7I.80 Excise Act Duty F.Y. 2009-I0 us that they will prefer an appeal with Gujarat High Court within the time allowed.

Central Excise F.Y. 2008-09 &

2 The Customs Excise & Service Tax appellate tribunal - Ahmedabad 255.98 Excise Act Duty F.Y. 2009-I0

Total 4427.78

10. The Company''s accumulated losses at the end of the financial year were more than fifty percent of its net worth. The Company has incurred cash losses in the financial year and in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanation given to us by the management, the company has defaulted in repayment of loans and interest to bank. Delays were noticed in payment of interest and principal on several occasions during the year. Estimated unpaid overdoes to bank as at March 3I,20I3 are as per details given below:

Nature of loan Due date Principal amount overdue Interest amount overdue Total amount overdue

Working Capital Term Loan 3I/I2/20I2 - II437830 II437830

Funded Interest Term loan 3I/I2/20I2 - 58237 58237

Cash Credit 3I/I2/20I2 - 486II64 486II64

Working Capital Term Loan 3I/0I/20I3 I000000 II53242I I253242I

Funded Interest Term loan 3I/0I/20I3 200000 I47I635 I67I635

Cash Credit 3I/0I/20I3 - 486II64 486II64

Working Capital Term Loan 28/02/20I3 I000000 I0485233 II485233

Funded Interest Term loan 28/02/20I3 200000 I343047 I543047

Cash Credit 28/02/20I3 - 4390729 4390729

Total 2400000 5044I460 5284I460

12. According to the information and explanations given to us, no loans & Advances have been granted by the company on the basis of the securities by way of pledge of shares, debentures and other securities.

13. In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provision of clause (xiii) of paragraph 4 of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

14. In respect of the dealings in shares and other securities, proper records have been maintained and timely entries have been made therein All these securities have been held by the company in its own name.

15. According to the information and explanation given to us the Company has given guarantee for loans taken by one Associate company from bank. According to the information & explanation given to us, we are of the opinion that the terms & conditions thereof are not prima facie prejudicial to the interest of the company.

16. Based on our audit procedures and on the information given by the management, we report that the company has not raised any term loans during the year.

17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 3Ist March, 20I3, we report that no funds raised on short-term basis have been used for long-term investment by the Company.

18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year.

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

20. Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management.

For Bansal Bansal & Co.

Chartered Accountants

Firm Regn. No. I00986W

Anand Drolia

Partner

Mumbai, 29th May, 20I3 Membership No. 0367I8

---

Mar 31, 2012

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

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

3. As required by the Companies (Auditor's Report) Order, 2003 (as amended), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

a) Save and except cases mentioned in the Statement of matters as per clause 3 above and Note No. 46, 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 Accounts as required by law have been kept by the Company so far as appears from our examination of these books;

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

d) In our opinion, the Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read with the notes thereon give the Information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

1) In the case of Balance Sheet, of the State of Affairs of the Company as at 31st March, 2012;

2) In the case of Profit and Loss Account, of the Loss of the Company for the year ended on that date; and

3) In the case of Cash Flow Statement, of the Cash Flow for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT

As required by the Companies (Auditor's Report) Order, 2003 (as amended), issued by the Central Government of India in terms of Section 227 (4A) Of the Companies Act, 1956, we further report that

1) In respect of its fixed assets:

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

(b) Subject to our comments in clause (a) above, these fixed assets have been physically verified by the management at reasonable intervals. However, such physical verification report has not been made available to us during the course of our audit. It is explained that no material discrepancy has been reportedly noticed on such verification.

(c) In our opinion, the company has not disposed off substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2) In respect of its inventories:

(a) It is explained to us that the inventory has been physically verified during the year by the management. However, such physical verification report has not been made available to us during the course of our audit. Hence we are unable to comment on the reasonableness of frequency and procedure of the verification of inventory. However, inventories have also been audited by independent auditors appointed by lending bank and also by bank officials from time to time and no adverse opinion has been given by said auditors and officials.

(b) The Company has maintained proper book records of Inventory. Packing & sample material and stores & spares purchased are written off as expenses in the year of purchase.

3) (a) The Company has granted interest free unsecured loans and advances to two 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 such loans aggregate to Rs. 134.61 Lacs and Rs. 42.41 Lacs respectively.

(b) Except for the fact that these loans and advances are interest free, in our opinion and according to the information and explanations given to us, the other terms and conditions of loans given are not prima facie prejudicial to the interest of the Company.

(c) The principle amount is repayable over the period of two to three years.

(d) In respect of the aforesaid loans, there is no overdue amount.

(e) The company has taken interest free unsecured loans and advances from one 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 loans aggregate to Rs. 137 Lacs and Rs. 137. Lacs.

(f) The said loans are interest-free loans. Other terms and conditions on which the loans have been taken are prima facie, not prejudicial to the interest of the Company.

(g) According to information provided to us, there is no default in repayment of said loans.

4) In our opinion, and according to the Information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods, keeping in view the close supervision and authorization by the directors. During the course of our audit, we have not observed any major weaknesses in internal control system.

5) In respect of the contractor arrangements referred to in section 301 of the Companies Act, 1956.

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of the contracts/arrangements entered in the Registered maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rupees Five Lacs in respect of the each party during the year have been made at prices which are reasonable having regards to the prevailing market price at the relevant time.

6) As explained to us, during the year under reference the Company has not accepted any Deposits from the Public within the meaning of Provisions of Section 58A and 58AA of the Act and the rules framed there under. Therefore, the provision of clause (vi) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the company.

7) As explained to us, the Company has an internal audit system commensurate with the size and nature of its business, however, report of such internal audit has not been made available to us.

8) 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.

9) (a) The Company is generally regular in depositing Provident Fund dues with Appropriate Authorities

(b) According to the records of the Company, undisputed material statutory dues including, Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues have been generally regularly deposited with the appropriate authorities, except some delays in payment of Sales Tax, Service Ta x and TDS. No undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2012 for a period of more than six months from the date of becoming payable except Rs. 5372902/– towards MVAT and Rs. 1300/– towards Profession Tax liabilities.

(c) The disputed statutory dues aggregating to Rs. 4665.79 Lacs that have not been deposited, on account of matters pending before appropriate authorities are as under :-

(Rs. In Lacs)

Sl. Name of the Statute Nature of Period for which the No. the dues amount relates

1. Income Tax Act, 1961 Income Tax A.Y 1996-1997 2. Central Excise Act Excise Duty F.Y. 2008-09 & F.Y.2009-10

3. Central Excise Act Excise Duty F.Y. 2008-09 & F.Y.2009-10

Sl. Name of the Statute Forum where Amount No. dispute is pending

1. Income Tax Act, 1961 DCIT (effect to rectification application pending) 2.75

2. Central Excise Act The Customs, Excise and Service Tax, Appellate Tribunal, Ahmedabad 4171.80

3. Central Excise Act Commissioner of Central Excise & Service Tax, Baroda 491.24

Total 4665.79

10) The Company does not have accumulated losses at the end of the financial year. The Company has incurred cash losses of Rs. 1233.90 Lacs during the financial year covered by the audit. However the company did not incur any cash loss in the immediately preceding financial year.

11) Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that till the balance sheet date the company has not defaulted in the repayment of dues to financial institutions and banks.

12) According to the information and explanations given to us, no Loans & Advances have been granted by the company on the basis of the securities by way of pledge of shares , debentures and other securities.

13) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provision of clause (xiii) of paragraph 4 of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

14) In respect of the dealings in shares and other securities, proper records have been maintained and timely entries have been made there in. All these securities have been held by the company in its own name.

15) According to the information and explanation given to us the Company has given guarantee for loans taken by one Associate companies from the bank. According to the information & explanation given to us, we are of the opinion that the terms & conditions thereof are not prima facie prejudicial to the interest of the company.

16) During the year the company has not taken any term loans from Banks & Financial Institutions.

17) According to the information and explanation given to us and an overall Examination of the Balance Sheet of the Company, we are of the opinion that the Company has not utilised any amount from short term sources towards long term investments.

18) 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.

19) The Company has not raised any money by public issue during the year. Therefore, the provisions of clause 4 (xx) of the Companies (Auditor's Report) Order 2003 (as amended) are not applicable to the Company.

20) As per the information and explanations given to us and on the basis of examination of records, no fraud on or by the Company has been noticed or reported during the course of our audit.



For Bansal, Bansal & Co. Chartered Accountants Firm Regn. No. 100986W

Anand Drolia Partner Membership No. 036718

Mumbai, 4th June, 2012

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of BILPOWER LIMITED as at 31 st March 2011, the Profit & Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003 (as amended), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we 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 Accounts as required by law have been kept by the Company so far as appears from our examination of these books;

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

d) In our opinion, the Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read with the notes thereon give the Information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

1) In the case of Balance Sheet, of the State of Affairs of the Company as at 31st March, 2011;

2) In the case of Profit and Loss Account, of the Profit of the Company for the year ended on that date; and.

3) In the case of Cash Flow Statement, of the Cash Flow for the year ended on that date

ANNEXURE TO THE AUDITORS' REPORT

As required by the Companies (Auditor's Report) Order, 2003 (as amended), issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we further report that:

1) In respect of its fixed assets:

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

(b) These fixed assets have been physically verified by the management at reasonable intervals. No material discrepancy has been reportedly noticed on such verification.

(c) In our opinion, the Company has not disposed off substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2) In respect of its inventories:

(a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of die verification is reasonable.

(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 nature of its business.

(c) The Company has maintained proper records of Inventory and the discrepancies noticed on such verifications between the physical inventory and book records were not material. Packing & sample material and stores & spares purchased are written off as expenses in the year of purchase.

3) (a) The Company has granted unsecured loans and advances to three 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 such loans aggregate to Rs. 4736.54 Lacs and Rs. 199.52 Lacs respectively.

(b) In our opinion, the rate of interest and other terms and conditions of loans given are not prima facte prejudicial to the interest of the Company.

(c ) The parties are repaying the principal amounts, where applicable and are also regular in payment of interest, as and where stipulated.

(d) In respect of the aforesaid loans, there is no overdue amount of more than Rupees one Lac.

4) In our opinion, and according to the Information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods, keeping in view the close supervision and authorization by the directors. During the course of our audit, we have not observed any major weaknesses in internal control system.

5) In respect of the contractor arrangements referred to in section 301 of the Companies Act 1956.

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of the contracts / arrangements entered in the Registered maintained under section 301 of the Companies Act 1956 and exceeding the value of Rupees Five Lacs in respect of the each party during the year have been made at prices which are reasonable having regards to the prevailing market price at the relevant time.

6) As explained to us, during the year under reference the Company has not accepted any Deposits from the Public within the meaning of Provisions of Section 58A and 58AA of the Act and the rules framed there under. Therefore, the provision of clause (vi) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the company.

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

8) As explained to us by the Management, the Company is not required to maintain the cost records under section 209 (1) (d) of the Act.

9) (a) The Company is generally regular in depositing Provident Fund dues with Appropriate Authorities.

(b) According to the records of the Company, undisputed material statutory dues including, Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income - Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues have been generally regularly deposited with the appropriate authorities, except some delays in payment of Sales Tax and TDS. No undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2011 for a period of more than six months from the date of becoming payable except Rs. 2040/- towards Profession Tax liabilities.

(c) The disputed statutory dues aggregating to Rs. 2.75 Lacs that have not been deposited, on account of matters pending before appropriate authorities are as under :-

Sr.No. Name of the Nature of Period for Forum where Amount Statute the dues which the dispute is (Rs.in amount pending Lacs) relates

1. Income Tax Income A.Y. ITAT (effect Act,1961 Tax 1996-97 to CIT Appeal order pending) 2.75

Total 2.75

10) The Company does not have 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.

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

12) According to the information and explanations given to us, no loans & Advances have been granted by the Company on the basis of the securities by way of pledge of shares , debentures and other securities.

13) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provision of clause (xiii) of paragraph 4 of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

14) In respect of the dealings in shares and other securities, proper records have been maintained and timely entries have been made there in. All these securities have been held by the company in its own name.

15) According to the information and explanation given to us the Company has given guarantee for loans taken by two Associate companies from the banks. According to the information & explanation given to us, we are of the opinion that the terms & conditions thereof are not prima facie prejudicial to the interest of the company.

16) During the year the Company has not taken any term loans from Banks & Financial Institutions.

17) According to the information and explanation given to us and an overall Examination of the Balance Sheet of the Company, we are of the opinion that the Company has not utilised any amount from short term sources towards long term investments.

18) 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.

19) The Company has not raised any money by public issue during the year. Therefore, the provisions of clause 4 (xx) of the Companies (Auditor's Report) Order 2003 (as amended) are not applicable to the Company.

20) As per the information and explanations given to us and on the basis of examination of records, no fraud on or by the Company has been noticed or reported during the course of our audit.

Other Clauses of the aforesaid order are not applicable to the Company and hence our remarks on them are not required to be made.

For Bansal, Bansal & Co. Chartered Accountants Firm Regn. No. 100986W

Anand Drolia Partner Membership No. 036718

Mumbai, 13th August, 2011

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of BILPOWER Limited as at 31st March 2010, the Profit & Loss Account and also the 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 the 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 (as amended), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we 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 Accounts as required by law have been kept by the Company so far as appears from our examination of these books;

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

d) In our opinion, the Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

e) On the basis of written representations received from the Directors as on 31st March 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2010 from being appointed as director in terms of clause (g) of sub Section (1) of section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read with the notes thereon give the Information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

1) In the case of Balance Sheet, of the State of Affairs of the Company as at 31st March, 2010;

2) In the case of Profit and Loss Account, of the Profit of the Company for the year ended on that date; and

3) In the case of Cash Flow Statement, of the Cash Flow for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT

As required by the Companies (Auditors Report) Order, 2003 (as amended), issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we further report that -

* 1) In respect of its fixed assets:

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

(b) These fixed assets have been physically verified by the management at reasonable intervals. No material discrepancy has been reportedly noticed on such verification.

(c) In our opinion, the company has not disposed off substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2) In respect of its inventories:

(a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of the verification is reasonable.

(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 nature of its business.

(c) The Company has maintained proper records of Inventory and the discrepancies noticed on such verifications between the physical inventory and book records were not material. Packing & sample material and stores & spares purchased are written off as expenses in the year of purchase.

3) (a) The Company has granted unsecured loans and advances to Two 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 such loans aggregate to Rs. 795.35 Lacs and 750.35 Lacs respectively.

(b) In our opinion, the rate of interest, wherever applicable and other terms and Conditions of loans given are not prima facie prejudicial to the interest of the Company.

(c) The parties are repaying the principal amounts, where applicable and are also regular in payment of interest, as and where stipulated.

(d) In respect of the aforesaid loans, there is no overdue amount of more than Rupees one Lac.

4) In our opinion, and according to the Information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods, keeping in view the close supervision and authorization by the directors. During the course of our audit, we have not observed any major weaknesses in internal control system.

5) In respect of particulars of contracts or arrangements entered in the register maintained in pursuance of section 301 of the Companies Act, 1956:

(a) To the best of our knowledge and belief and according to the information and explanations given to us, particulars of contracts or arrangements that needed to be entered into the register have been so entered.

(b) According to the information and explanations given to us, each of the transactions made in pursuance of such contracts / arrangements in excess of Rs. Five Lacs in respect of any party during the year, have been made at prices which are reasonable having regards to the prevailing market prices at the relevant time.

6) As explained to us, during the year under reference the Company has not accepted any Deposits from the Public within the meaning of Provisions of Section 58A and 58AA of the Act and the rules framed there under. Therefore, the provision of clause (vi) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the company.

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

8) As explained to us by the Management, the Company is not required to maintain the cost records under section 209 (1) (d) of the Act.

9) (a) The Company is generally regular in depositing Provident Fund dues with appropriate Authorities.

(b) According to the records of the Company, undisputed material statutory dues including, Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income - Tax, Sales - Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues have been generally regularly deposited with the appropriate authorities, except some delays in payment of Sales Tax, Service Tax and TDS. According to the information and explanations given to usi, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2010 for a period of more than six months from the date of becoming payable except Rs 1780/- towards Profession Tax liabilities.

(c) The disputed statutory dues aggregating to Rs. 2.75 Lacs that have not been Deposited, on account of matters pending before appropriate authorities are as under: -

St. Name of the Nature of the Period to Forum where Amount No. Statute dues which the amount the dispute is amount pending (In Lacs) relates

1. Income Tax Income Tax A.Y. 1996 Act 1961 -97 ITAT (effect to CIT 2.75 Appeal order pending) Total 2.75

10) The Company does not have 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.

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

12) According to the information and explanations given to us, the Company has maintained adequate records where ever its receivables are secured by way of pledge of shares.

13) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provision of clause (xiii) of paragraph 4 of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company.

14) In respect of the dealings in shares and other securities, proper records have been maintained and timely entries have been made there in. All these securities have been held by the Company in its own name.

15) According to the information and explanation given to us the Company has given guarantee for loans taken by its subsidiary from banks. According to the information & explanation given to us, we are of the opinion that the terms & conditions thereof are not prima facie prejudicial to the interest of the company.

16) Based on information and explanation given to us by the management, term loans were applied for the purpose for which the loans were obtained.

17) According to the information and explanation given to us and an overall Examination of the Balance Sheet of the Company, we are of the opinion that the Company has not utilised any amount from short term sources towards long term investments.

18) 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.

19) The Company has not raised any money by public issue during the year. Therefore, the provisions of clause 4 (xx) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

20) As per the information and explanations given to us and on the basis of examination of records, no material fraud on or by the Company has been noticed or reported during the course of our audit.

Other Clauses of the aforesaid order are not applicable to the Company and hence our remarks on them are not required to be made.

For Bansal, Bansal & Co. Chartered Accountants Firm Regn. No. 100986W

(Manoj Agrawal) Partner Mumbai, 18th May, 2010 Membership No. 107624