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Auditor Report of ECE Industries Ltd.

Mar 31, 2018

Report on Ind AS Financial Statements

We have audited the accompanying Ind AS financial statements of ECE Industries Limited, (''the Company''), which comprise the Balance Sheet as at 31st March, 2018, the Statement of Profit and Loss, the statement of cash flows and the statement of changes in equity for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Ind AS Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (''the Act'') with respect to the preparation of these financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (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 AS¹) 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 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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Ind AS 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 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 Company''s Directors, as well as evaluating the overall presentation of the 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 the 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 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 Ind AS specified under Section 133 of the Act, of the state of affairs (financial position) of the Company as at 31st March 2018 and its Statement of Profit & loss (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 (Auditor''s Report) Order, 2016 (''the Order¹), 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 and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards ("Ind AS") prescribed under Section 133 of the Act.

(e) On the basis of written representations received from the directors as on 31st March, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 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 operation effectiveness of such controls, refer to our separate report in "Annexure- B"

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

i. the company has disclosed the impact of pending litigations on its financial statements.

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

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

ANNEXURE "A" TO THE INDEPENDENT AUDITOR''S REPORT

The Annexure referred to in our Independent Auditor''s Report of even date to the members of the Company on the financial statements for the year ended 31st March, 2018, we report that:

i) a) The Company has maintained proper records showing full particulars including quantitative details and situation of Property Plant & Equipment.

b) The company has planned program to physically verify assets in alternative years, which in our opinion is reasonable having regards to the size of the company and the nature of the assets. In accordance with the said program, certain property plant & equipment were verified during the year and no material discrepancies were noticed on such verification.

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

ii) As per the explanations given to us, inventories were physically verified during the year by the management at reasonable intervals and no material discrepancy was noticed on such verification.

iii) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act.

iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.

v) The Company has not accepted any deposits from public.

vi) According to the information and explanations given to us, the company is maintaining its cost records as per the form prescribed by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, for the activities of the company. We have broadly reviewed the cost records made and maintained by the company and are of the opinion that prima facie the prescribed records have been made and maintained. We however not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii) a) The company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax and any other statutory dues with the appropriate authorities. There are no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable except as given below:

No.

Name of the Statue

Nature of Due

Period to which it Relates

Amount (Rs. in lakh)

Date of Payment

Jharkhand Value Added Tax Act, 2005

VAT Liability

2013-14 & 2014-15

3.54

Not Paid

(b) According to the records of the company, there are no dues outstanding of Sales tax. Wealth tax. Service tax. Custom duty. Excise duty, VAT and Cess on account of any dispute other than the following:-

Name of The Statute	Nature of Dues	Year	Amount (Rs. in lakh)*	Forum where dispute is Pending
Delhi Works Contract Act, 1999	Demand Towards Work Contract Tax	2002-03	12.00	Deputy Commissioner (Appeals), Delhi
Andhra Pradesh General Sales Tax Act, 1957(Central)	Demand towards Works Contract Tax	2001-02, 2003-04	10.94	Commercial Tax Officer, Andhra Pradesh
Gujarat State Sales Tax Act, 1969	Demand towards work contract tax	1993-94	2.78	Deputy Commissioner (Appeals), Gujarat
Central Excise Act, 1944	Demand towards Excise Duty	1998-99	5.82	Andhra Pradesh High Court
U P Municipal Laws (Cess Act)	Demand towards Water Cess	1992-93	0.60	Tehsildar, Gaziabad, (U.P.)
Central Excise Act, 1944	Demand towards Excise Duty	2007-08	1.17	Additional Commissioner (Excise), Rohtak

* Net of payments

viii) The company has not defaulted in repayment of loans or borrowing to a financial institution, bank or Government. According to the information and explanations given to us, there are no dues outstanding in respect of any debenture during the current financial year or any previous year.

ix) During the year the Company has not raised any funds through Initial/Further Public offer (including debt instruments) and the term loans were applied for the purpose for which they were obtained.

x) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid or 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) 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 section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the financial statements as required by the applicable accounting standards.

xiv) According to the information and explanations give 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.

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

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

ANNEXURE "B" TO THE INDEPENDENT AUDITOR''S REPORT

Report on the Internal Financial Controls under Clause (i) of Sub -section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of ECE Industries Limited as of March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

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

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the 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 and the Guidance Note issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls over Financial Reporting

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

Inherent Limitations of Internal Financial Controls over Financial Reporting

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

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 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 issued by the ICAI.

For VSD & Associates

Chartered Accountants

Firm Registration No.: 008726N

(Vinod Sahni)

Place : New Delhi Partner

Dated: 1st May 2018 M.No.086666

Mar 31, 2016

The Members,

ECE Industries Limited

Report on Financial Statements

We have audited the accompanying financial statements of ECE Industries Limited, which comprise the Balance Sheet as at 31st March, 2016, 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 Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2016, and its loss and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 (''the Order''), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the "Annexure-A" a statement on the matters specified in 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 Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid 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 written representations received from the directors as on 31 March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2016 from being appointed as a director in terms of Section 164(2) of the Act.

i. the company has disclosed the impact of pending litigations on its financial statements. - Refer Note 10.1.2 to the financial statements.

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

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

ANNEXURE "A" TO THE INDEPENDENT AUDITORâS REPORT

The Annexure referred to in our Independent Auditors'' Report of even date to the members of the Company on the financial statements for the year ended 31 March 2016, we report that:

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

b) The company has planned program to physically verify assets in alternative years, which in our opinion is reasonable having regards to the size of the company and the nature of the assets. In accordance with the said program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification.

ii) As per the explanations given to us, inventories were physically verified during the year by the management at reasonable intervals and no material discrepancy was noticed on such verification.

v) The Company has not accepted any deposits from public.

No.

Name of the Statue

Nature of Due

Period to which it Relates

Amount (Rs. in lacs)

Date of Payment

Jharkhand Value Added Tax Act, 2005

VAT Liability

2013-14 & 2014-15

3.57

Not Paid

(b) According to the records of the company, there are no dues outstanding of Sales tax, Wealth tax, Service tax, Custom duty, Excise duty, VAT and Cess on account of any dispute other than the following:-

Name of The Statute	Nature of Dues	Year	Amount (Rs.in Lacs)*	Forum where dispute is Pending
Orissa Sales Tax Act, 1947	Demand Towards Work Contract Tax	2001-02	26.24	Sales Tax Appellate Tribunal, Cuttack
Bihar Sales Tax Act, 1983	Demand Towards Work Contract Tax	1993-97 & 2000-01	21.96	Jharkhand High Court
West Bengal Sales Tax Act, 1994 (Local) & Central	Demand towards Local Sales Tax & Central Sales Tax	1994-95 & 2002-03	15.26	Sales Tax Revision Bench, West Bengal
Delhi Works Contract Act, 1999	Demand Towards Work Contract Tax	2002-03	12.00	Deputy Commissioner (Appeals), Delhi
Delhi Sales Tax Act, 1975 (Central)	Demand towards non submission of forms/ Concessional forms, and demand towards interest	1980-81, 1983-84, 1989-90, 1995-96 and 1981-82	13.95	Additional Commissioner Sales Tax, Delhi
Delhi Sales Tax Act, 1975 (Local)	Demand towards rejection of Stock transfer and non submission of forms	1980-81 & 1987-88	3.55	Deputy Commissioner Sales Tax, Delhi
Andhra Pradesh General Sales Tax Act, 1957(Central)	Demand towards Works Contract Tax	2001-02, 2003-04	10.94	Commercial Tax Officer, Andhra Pradesh
Gujarat State Sales Tax Act, 1969	Demand towards work contract tax	1993-94	2.78	Deputy Commissioner (Appeals), Gujarat
Central Excise Act, 1944	Demand towards Excise Duty	1998-99	5.82	Andhra Pradesh High Court
U P Municipal Laws (Cess Act)	Demand towards Water Cess	1992-93	0.60	Tehsildar, Gaziabad, (U.P.)
Central Excise Act, 1944	Demand towards Excise Duty	2007-08	1.17	Additional Commissioner (Excise), Rohtak
Finance Act, 1994	Interest and Penalty	2010-11	1.18	Commissioner (Appeals), Ghaziabad

* Net of payments

x) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

xii) The Company is not a Nidhi Company.

xv) According to the information and explanations given to us, the company has not entered into any noncash transactions with directors or persons connected with him.

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

ANNEXURE "B" TO THE INDEPENDENT AUDITOR''S REPORT ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTS OF ECE INDUSTRIES LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub -section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of ECE Industries Limited as of March 31, 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

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

Auditors'' Responsibility

Our responsibility is to express an opinion on the company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance note on audit of internal financial controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013 to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal Financial Controls and, both issued by the institute of Chartered Accountants of India. Those Standards and the Guidance note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting 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 operation 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 evaluation the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls over Financial Reporting

(1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

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

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent imitations 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 operation effectively as at March 31, 2016, based on the internal control over financial reporting criteria established by the company considering the essential components of internal control stated in the Guidance Note on Audit of internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For VSD & Associates

Chartered Accountants

Firm Registration No. : 008726N

Sd/-

(Vinod Sahni)

Place : New Delhi Partner

Dated: 12.05.2016 M.No.086666

Mar 31, 2015

We have audited the accompanying financial statements of ECE Industries Limited, which comprise the Balance Sheet as at 31st March, 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 Financial Statements

The Company's Board of Directors are responsible for the matters stated in Section 134(5) of the Companies Act, 2013 with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these 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 have 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 the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, 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, issued by the Central Government of India in terms of sub-section 11 of section 143 of the Act, we give in 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 accounts as required by law have been kept by the company so far as appears from the examination of those books.

c) The company's Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with in the report are in agreement with the books of account and returns;

d) In our opinion, the aforesaid financial statements comply with the accounting standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

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

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 Auditor's) 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 statements. - Refer Note 9.1 and 30.1 to the financial statements.

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

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

ANNEXURE TO THE AUDITOR'S REPORT

The Annexure referred to in our Independent Auditors' Report to the members of the Company on the financial statements for the year ended 31 March 2015, we report that:

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

(b) The company has planned program to physically verify assets in alternative years, which in our opinion is reasonable having regards to the size of the company and the nature of the assets. As per such plan, physical verification of fixed assets has not been conducted during the year.

ii. (a) As per the explanations given to us, inventories were physically verified during the year by the management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, 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.

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory and no material discrepancy was noticed on physical verification.

iii. According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act.

iv. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

v. The Company has not accepted any deposits from public.

vi. According to the information and explanations given to us, the company is maintaining its cost records as per the form prescribed by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, for any of the activities of the company. We have broadly reviewed the cost records made and maintained by the company and are of the opinion that prima facie the prescribed cost records have been made and 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) The company is regular in depositing undisputed statutory dues including provident fund, employees'

state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax and any other statutory dues with the appropriate authorities. There are no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable except as given below:

S. Name of the Statue Nature of Period to Amount No. Due which it (Rs. in Relates lacs)

1. Jharkhand Value Added VAT Liability 2013-14 & 2.60 Tax Act, 2005

S. Name of the Statue Date of No. Payment

1. Jharkhand Value Added Not Paid Tax Act, 2005 2014-15

(b) According to the records of the company, there are no dues outstanding of Sales tax, Wealth tax, Service tax, Custom duty, Excise duty, VAT and Cess on account of any dispute other than the following:-

Name of The Statute Nature of Dues

Orissa Sales Tax Act, 1947 Demand Towards Work Contract Tax

Bihar Sales Tax Act, 1983 Demand Towards Work Contract Tax

West Bengal Sales Tax Act, Demand towards Local 1994 (Local) & Central Sales Tax & Central Sales Tax

Delhi Works Contract Act, 1999 Demand Towards Work Contract Tax

Delhi Sales Tax Act, 1975 Demand towards non (Central) submission of forms/ Concessional forms, and demand towards interest

Delhi Sales Tax Act, 1975 Demand towards rejection (Local) of Stock transfer and non submission of forms

Andhra Pradesh General Demand towards Works Sales Tax Act, 1957(Central) Contract Tax

Gujarat State Sales Tax Demand towards work Act, 1969 contract tax

Central Excise Act, 1944 Demand towards Excise Duty

U P Municipal Laws (Cess Act) Demand towards Water Cess

Central Excise Act, 1944 Demand towards Excise Duty

Name of The Statute Year Amount (Rs. in Lacs)*

Orissa Sales Tax Act, 1947 2001-02 26.24

Bihar Sales Tax Act, 1983 1993-97 & 21.96 2000-01

West Bengal Sales Tax Act, 1994-95 & 15.26 1994 (Local) & Central 2002-03

Delhi Works Contract Act, 1999 2002-03 12.00

Delhi Sales Tax Act, 1975 1980-81, 1983-84, 13.95 (Central) 1989-90, 1995-96 and 1981-82

Delhi Sales Tax Act, 1975 1980-81 & 3.55 (Local) 1987-88

Andhra Pradesh General 2001-02, 10.94 Sales Tax Act, 1957(Central) 2003-04

Gujarat State Sales Tax 1993-94 2.78 Act, 1969

Central Excise Act, 1944 1998-99 5.82

U P Municipal Laws (Cess Act) 1992-93 0.60

Central Excise Act, 1944 2007-08 1.17

Name of The Statute Forum where dispute is Pending

Orissa Sales Tax Act, 1947 Sales Tax Appellate Tribunal, Cuttack

Bihar Sales Tax Act, 1983 Jharkhand High Court

West Bengal Sales Tax Act, Sales Tax Revision Bench, 1994 (Local) & Central West Bengal

Delhi Works Contract Act, 1999 Deputy Commissioner (Appeals), Delhi

Delhi Sales Tax Act, 1975 Additional Commissioner Sales (Central) Tax, Delhi

Delhi Sales Tax Act, 1975 Deputy Commissioner Sales Tax, (Local) Delhi

Andhra Pradesh General Commercial Tax Officer, Sales Tax Act, 1957(Central) Andhra Pradesh

Gujarat State Sales Tax Deputy Commissioner Act, 1969 (Appeals), Gujarat

Central Excise Act, 1944 Andhra Pradesh High Court

U P Municipal Laws (Cess Act) Tehsildar, Gaziabad, (U.P.)

Central Excise Act, 1944 Additional Commissioner (Excise), Rohtak

* Net of payments

(c) According to the information and explanations given to us, the amounts which were required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules there under has been transferred to such fund within time.

viii. The company has no accumulated losses at the end of the financial year and has not incurred any cash loss in the current and in the immediately preceding financial year.

ix. The company has not defaulted in repayment of dues to financial institutions or banks. According to the information and explanations given to us, the company has not issued any debenture during the current financial year or any previous year.

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

xi. According to the information and explanations given to us, the term loan was applied for the purpose for which it was obtained.

xii. According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For VSD & Associates Chartered Accountants Firm Registration No. : 008726N

Sd/-

(Vinod Sahni) Place : New Delhi Partner Dated: 26.05.2015 M.No.086666

Mar 31, 2014

We have audited the accompanying financial statements of ECE Industries Limited, ("the Company") which comprise the Balance Sheet as at 31st March, 2014 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.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conduct 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 risk 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 to 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 31st March, 2014;

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

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

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

Annexure referred to in paragraph 1 of our report of even date on the other legal and regulatory requirements (Re: ECE Industries Limited)

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

b. The Company has planned program to physically verify assets in alternate years, which in our opinion is reasonable having regards to the size of the company and nature of its assets. As per such plan physical verification of fixed assets was not conducted during the year.

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

(ii) a. As explained to us inventories (except stock-in-transit) were physically verified during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, 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.

c. In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory and no material discrepancy was noticed on physical verification.

(iii) a. As informed, the Company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies'' Act, 1956. Accordingly, paragraphs 4 (iii) (b), (c) and (d) of the Order are not applicable.

b. As informed, the Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies'' Act, 1956. Accordingly, paragraphs 4 (iii) (f) and (g) of the order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas.

(v) According to the information and explanations provided by the management, we are of the opinion that there are no transactions that needs to be entered into the Register maintained under Section 301 of the Companies'' Act, 1956. Therefore, the provisions of clause 4 (v) of the Order, 2003 is not applicable to the Company.

(vi) The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies'' Act, 1956. Accordingly clause 4(vi) of the Order is not applicable.

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

(viii) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records for its products under section 209(1)(d) of the Companies'' Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) a. According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income tax, Sales tax, Services tax, Custom duty, Excise duty, Cess and other statutory dues applicable to it with the appropriate authorities. There was no undisputed outstanding statutory dues as at the yearend for a period of more than six months from the date they became payable.

b. According to the records of the company, there are no dues outstanding of Sales tax, Income tax, Service tax, Custom Duty, Wealth tax, Excise duty and Cess on account of any dispute, other than the following:

Name of The Statute Nature of Dues Year

Orissa Sales Tax Act, 1947 Demand Towards Work 2001-02 Contract Tax

Bihar Sales Tax Act, 1983 Demand Towards Work 1993-97 & Contract Tax 2000-01

West Bengal Sales Tax Act, Demand towards Local 1994-95 &

1994 (Local) & Central Sales Tax & Central Sales Tax 2002-03

Delhi Works Contract Act, 1999 Demand Towards Work 2002-03 Contract Tax

Delhi Sales Tax Act, 1975 Demand towards non 1980-81, 1983-84, (Central) submission of forms/ 1989-90, 1995-96 Concessional forms, and and 1981-82 demand towards interest

Delhi Sales Tax Act, 1975 Demand towards rejection 1980-81 & (local) of Stock transfer and 1987-88 non submission of forms

Andhra Pradesh General Demand towards Works 2001-02,

Sales Tax Act, 1957(Central) Contract Tax 2003-04

Tamilnadu Commercial Commercial Tax 2000-01 Tax Act

Gujarat State Sales Tax Demand towards work 1993-94 Act, 1969 contract tax

Central Excise Act, 1944 Demand towards Excise Duty 1998-99

U P Municipal Laws (Cess Act) Demand towards Water Cess 1992-93

Name of The Statue Amount Forum where dispute is Pending (Rs. in Lacs)*

Orissa Sales Tax Act, 1947 26.24 Sales Tax Appellate Tribunal, Cuttack

Bihar Sales Tax Act, 1983 21.96 Jharkhand High Court

West Bengal Sales Tax Act, 1994 (Local) & Central 15.26 Sales Tax Revision Bench, West Bengal

Delhi Works Contract Act, 1999 12.00 Deputy Commissioner (Appeals), Delhi

Delhi Sales Tax Act, 1975 (Central) 13.95 Additional Commissioner Sales Tax, Delhi

Delhi Sales Tax Act, 1975 (local) 3.55 Deputy Commissioner Sales Tax, Delhi

Andhra Pradesh General Sales Tax Act, 1957 (Central) 10.94 Commercial Tax Officer, Andhra Pradesh

Tamilnadu Commercial Tax Act 71.62 Tamilnadu Sales Tax Appellate Tribunal Main Branch, Chennai

Gujarat State Sales Tax Act, 1969 2.78 Deputy Commissioner (Appeals), Gujarat

Central Excise Act, 1944 5.82 Andhra Pradesh High Court

U P Municipal Laws (Cess Act) 0.60 Tehsildar, Gaziabad, (U.P.)

* Net of payments

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash loss in the current and in the immediately preceding financial year.

(xi) The Company has not defaulted in repayment of dues to financial institutions and banks. We have been informed that the company has not issued any debenture during the year.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly, clause 4 (xiii) of the Order is not applicable.

(xiv) The Company does not deal or trade in shares, securities, debentures and other securities except that it has investments in shares, units of the mutual funds and debentures and these are held in the name of the company.

(xv) According to the information and explanations given to us, the Company has not given any corporate guarantee in favour of any financial institution or bank for loans taken by others.

(xvi) Based on information and explanations given to us, no term loan was obtained during the year. Accordingly, clause 4 (xvi) of the Order is not applicable.

(xvii) According to the information and explanation given to us and on an overall examination of the balance sheet and cash flow of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, clause 4(xviii) of the Order is not applicable.

(xix) The Company did not have any outstanding debentures during the year. Accordingly, clause 4(xix) of the Order is not applicable.

(xx) The Company has not raised any money through public issue. Accordingly, clause 4(xx) of the Order is not applicable.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of the audit.

For SINGHI & CO.

Chartered Accountants Firm Registration No.: 302049E Sd/- B.K.Sipani

Place : New Delhi Partner

Dated: 16th May, 2014 Membership No. 088926

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of ECE Industries Limited, ("the Company") which comprise the Balance Sheet as at 31st March, 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.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conduct 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 risk 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 to 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 31st March, 2013;

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

c. In the case of Cash Flow Statement, of the cash flows for the year ended on that date. Report on the 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 the 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 31st March, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies'' Act, 1956.

Annexure referred to in paragraph 1 of our report of even date on the other legal and regulatory requirements (Re: ECE Industries Limited)

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

b. Fixed Assets have been physically verified by the management during the year as per regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. As informed, no material discrepancy was noticed on physical verification carried out during the year.

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

(ii) a. As explained to us inventories (except stock - in-transit) were physically verified during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, 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.

c. In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory and no material discrepancy was noticed on physical verification.

(iii) a. As informed, the Company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies'' Act, 1956. Accordingly, paragraphs 4 (iii) (b), (c) and (d) of the Order are not applicable. b. As informed, the Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies'' Act, 1956. Accordingly, paragraphs 4 (iii) (f) and (g) of the order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas

(v) According to the information and explanations provided by the management, we are of the opinion that there are no transactions that needs to be entered into the Register maintained under Section 301 of the Companies'' Act, 1956. Therefore, the provisions of clause 4 (v) of the Order, 2003 is not applicable to the Company.

(vi) The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies'' Act,1956. Accordingly clause 4(vi) of the Order is not applicable.

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

(viii) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records for its products under section 209(1)(d) of the Companies'' Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) a. According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax, Services tax, Custom duty, Excise duty, Cess and other statutory dues applicable to it with the appropriate authorities.There was no undisputed outstanding statutory dues as at the yearend for a period of more than six months from the date they became payable.

b. According to the records of the company, there are no dues outstanding of Sales tax, Income tax, Service tax, Custom Duty, Wealth tax, Excise duty and Cess on account of any dispute, other than the following:

(X) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash loss in the current and in the immediately preceding financial year.

(xi) The Company has not defaulted in repayment of dues to financial institutions and banks. We have been informed that the company has not issued any debenture during the year.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society.Accordingly, clause 4 (xiii) of the Order is not applicable.

(xiv) The Company does not deal or trade in shares, securities, debentures and other securities except that it has investments in shares, units of the mutual funds and debentures and these are held in the name of the company.

(xv) According to the information and explanations given to us, the Company has not given any corporate guarantee in favour of any financial institution or bank for loans taken by others

(xvi) Based on information and explanations given to us, no term loan was obtained during the year. Accordingly, clause 4 (xvi) of the Order is not applicable.

(xvii) According to the information and explanation given to us and on an overall examination of the balance sheet and cash flow of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, clause 4(xviii) of the Order is not applicable.

(xix) The Company did not have any outstanding debentures during the year. Accordingly, clause 4(xix) of the Order is not applicable.

(xx) The Company has not raised any money through public issue. Accordingly, clause 4(xx) of the Order is not applicable.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of the audit.

For SINGHI & CO.

Firm Registration No. : 302049E

B.K.Sipani

Place : New Delhi Partner

Dated: 28th May, 2013 Membership No. 088926

Mar 31, 2012

We have audited the attached Balance Sheet of ECE INDUSTRIES LIMITED, as at 31st March, 2012 and also the Statement of Profit and Loss and 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.

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

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

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

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

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

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

iv. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

v. 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 director 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;

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with 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;

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

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

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

Annexure referred to in paragraph 3 of our report of even date to the shareholders

Re: ECE Industries Limited

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

b. Fixed Assets have been physically verified by the management during the year as per regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on physical verification carried out during the year.

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

(ii) a. As explained to us inventories (except stock-in-transit) were physically verified during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, 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.

c. In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) a. As informed, the Company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (b), (c) and (d) of the Companies (Auditor's Report) Order, 2003 (as amended) (herein referred to as the order), are not applicable,

e. As informed, the Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (f) and (g) of the order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in internal control system.

(v) According to the information and explanations provided by the management, we are of the opinion that there are no transactions that needs to be entered into the Register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (v) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the company.

(vi) The Company has not accepted any deposits from the public within the meaning of Section 58A of the Companies Act, 1956.

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

(viii) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records for its Products under section 209(l)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) a. According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, services tax, custom duty, excise duty, cess and other statutory dues applicable to it with the appropriate authorities.There was no undisputed outstanding statutory dues as at the year end for a period of more than six months from the date they became payable.

b. According to the records of the Company, there are no dues outstanding of sales tax, income tax, service tax, custom tax, wealth tax, excise duty and cess on account of any dispute, other than the following:

Name of The Statute Nature of Dues Year Amount Forum where dispute is Pending (Rs. in lacs)*

Orissa Sales Tax Act, 1947 Demand Towards Work 1997-99 & 26.24 Sales Tax Appellate Tribunal, Contract Tax 2001-02 Cuttack

Bihar Sales Tax Act, 1983 Demand Towards Work 1993-97 & 21.96 Jharkhand High Court Contract Tax 2000-01

West Bengal Sales Tax Act, Demand towards Local 1994-97 & 15.26 Sales Tax Revision Bench, 1994 (Local) & Central Sales Tax & Central Sales Tax 2002-03 West Bengal

Delhi Works Contract Act, 1999 Demand Towards Work 2002-03 12.00 Deputy Commissioner (Appeals), Contract Tax Delhi

Delhi Sales Tax Act, 1975 Demand towards non 1980-81, 1983-84, 13.95 Additional Commissioner Sales (Central) submission of forms/ 1989-90, 1995-96 Tax, Delhi Concessional forms, and and 1981-82 demand towards interest

Delhi Sales Tax Act, 1975 Demand towards rejection 1980-81 & 3.55 Deputy Commissioner Sales Tax, (local) of Stock transfer and 1987-88 Delhi non submission of forms

Kerala State Sales Demand towards Works 1997-98, 1998-99 15.52 Assistant Commissioner Tax Act, 1963 Contract Tax 1999-2000 Commercial Taxes, Ernakulam

Andhra Pradesh General Demand towards Works 2001-02, 10.94 Commercial Tax Officer, Sales Tax Act, 1957 (Central) Contract Tax 2003-04 Andhra Pradesh

Tamilnadu Commercial Commercial Tax 2000-01 71.62 Tamil Nadu Sales Tax Appellate Tax Act Tribunal Main Branch, Chennai

Gujarat State Sales Tax Demand towards work 1993-94 2.78 Deputy Commissioner Act, 1969 contract tax (Appeals), Gujarat

Central Excise Act, 1944 Demand towards Excise Duty 1998-99 5.82 Andhra Pradesh, High Court

U P Municipal Laws (Cess Act) Demand towards Water Cess 1992-93 0.60 Tehsildar, Gaziabad, (U.P.)

* Net of payments

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash loss in the current and immediately preceding financial year.

(xi) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. We have been informed that the Company has not issued any debenture during the year.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society, therefore, the provisions of clause 4 (xiii) of the Companies (Auditor's Report) Order,2003 (as amended), are not applicable to the Company.

(xiv) The Company does not deal or trade in shares, securities, debentures and other securities except that it has investments in shares and these are held in the name of the Company.

(xv) According to the information and explanations given to us, the Company has not given any corporate guarantee in favour of financial institution/bank for loans taken by others

(xvi) Based on information and explanations given to us, no term loan was obtained during the year.

(xvii) According to the information and explanation given to us, on an overall examination of the balance sheet and cash flow 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 or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money through public issue.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of the audit.

For SINGHI & CO.

Chartered Accountants

Firm Registration No.: 302049E

B.K.Sipani

Place : New Delhi Partner

Dated: 8th June, 2012 Membership No. 088926

Mar 31, 2011

We have audited the attached Balance Sheet of ECE INDUSTRIES LIMITED, as at 31st March, 2011 and also the Profit and Loss account and 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.

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

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

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

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

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

iii. The Balance Sheet, Profit and Loss account and Cash Flow statement dealt with by this report are in agreement with the books of account;

iv. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

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

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with 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;

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

b) In the case of the Profit and Loss account, of the profit of the Company for the year ended on that date; and

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

Annexure referred to in paragraph 3 of our report of even date to the shareholders Re: ECE Industries Limited

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

b. Fixed Assets have been physically verified by the management during the year as per regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on physical verification carried out during the year.

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

(ii) a. As explained to us inventories (except stock - in-transit) were physically verified during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, 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.

c. In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) a. As informed, the Company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (b), (c) and (d) of the Companies (Auditor's Report) Order, 2003 (as amended) (herein referred to as the order), are not applicable.

e. As informed, the Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (f) and (g) of the order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is adequate

internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in internal control system.

(v) According to the information and explanations provided by the management, we are of the opinion that there are no transactions that needs to be entered into the Register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (v) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

(vi) The Company has not accepted any deposits from the public within the meaning of Section 58A of the Companies Act, 1956.

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

(viii) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records for its Transformer Division under section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) a. According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, services tax, custom duty, excise duty, cess and other statutory dues applicable to it with the appropriate authorities. There was no undisputed outstanding statutory dues as at the year end for a period of more than six months from the date they became payable.

b. According to the records of the Company, there are no dues outstanding of sales tax, income tax, service tax, custom tax, wealth tax, excise duty and cess on account of any dispute, other than the following:

Name of The Statute Nature of Dues Year

Orissa Sales Tax Act, 1947 Demand Towards Work 1997-99 & Contract Tax 2001-02

Bihar Sales Tax Act, 1983 Demand Towards Work 1993-97 & Contract Tax 2000-01

Andhra Pradesh General Demand towards negative 1995-96 Sales Tax Act, 1957 (Local) price variation

Andhra Pradesh General Demand towards negative 1994-95 Sales Tax Act, 1957 (Local) price variation and interest on delayed payment

Andhra Pradesh General Demand towards interest 1998-99 Sales Tax Act, 1957 (Local) on delayed payment

Andhra Pradesh General Demand towards non submission 1989-90 Sales Tax Act, 1957 of forms/ (Central) Concessional forms & 1998-99

Andhra Pradesh General Demand towards Works 1994-95 & Sales Tax Act, 1957 (Central) Contract Tax 1995-96

Andhra Pradesh General Demand towards non submission 1995-96 Sales Tax Act, 1957 (Central) of forms/Concessional forms

West Bengal Sales Tax Act, Demand towards Local 1994-97 & 1994 (Local) & Central Sales Tax & Central Sales Tax 2002-03

Delhi Works Contract Act, 1999 Demand Towards Work 2002-03 & Contract Tax 2004-05

Delhi Sales Tax Act, 1975 Demand towards non 1980-81, 1983-84, (Central) submission of forms/ 1989-90, 1995-96 Concessional forms, and and 1981-82 demand towards interest

Delhi Sales Tax Act, 1975 Demand towards rejection 1980-81 & (local) of Stock transfer and 1987-88 non submission of forms

Kerala State Sales Demand towards Works 1997-98, 1998-99 Tax Act, 1963 Contract Tax 1999-2000

Andhra Pradesh General Demand towards Works 2001-02, Sales Tax Act, 1957 (Central) Contract Tax 2003-04

Uttar Pradesh Trade Demand towards Non-Submission 2007-08 Tax Act, 1948 of Forms/ Concessional Forms

Tamilnadu Commercial Commercial Tax 2000-01 Tax Act

Gujarat State Sales Tax Demand towards work 1993-94 Act, 1969 contract tax

Central Excise Act, 1944 Demand towards Excise Duty 1998-99

U P Municipal Laws (Cess Act) Demand towards Water Cess 1992-93

Name of The Statute Amount Forum where dispute (Rs. in Lacs)* is Pending

Orissa Sales Tax Act, 1947 26.24 Sales Tax Appellate Tribunal, Cuttack

Bihar Sales Tax Act, 1983 21.96 Jharkhand High Court

Andhra Pradesh General 2.20 Commercial Tax Officer, Sales Tax Act, 1957 (Local) Vizag

Andhra Pradesh General 14.59 Commercial Tax Officer, Sales Tax Act, 1957 (Local) Sales Tax Andhra Pradesh

Andhra Pradesh General 0.54 Additional Commissioner, Sales Tax Act, 1957 (Local) Hyderabad

Andhra Pradesh General 0.25 Sales Tax Appellate Sales Tax Act, 1957 (Central) Tribunal, Hyderabad

Andhra Pradesh General 7.03 Dy. Commissioner Sales Tax Act, 1957 (Central) Reassessment, Andhra Pradesh

Andhra Pradesh General 4.81 Commercial Tax Officer, Sales Tax Act, 1957 (Central) Andhra Pradesh

West Bengal Sales Tax Act, 15.26 Sales Tax Revision Bench, 1994 (Local) & Central West Bengal

Delhi Works Contract Act, 20.43 Deputy Commissioner 1999 (Appeals), Delhi

Delhi Sales Tax Act, 1975 13.95 Additional Commissioner (Central) Sales Tax, Delhi

Delhi Sales Tax Act, 1975 3.55 Deputy Commissioner (local) Sales Tax, Delhi

Kerala State Sales 15.52 Assistant Commissioner Tax Act, 1963 Commercial Taxes, Ernakulam

Andhra Pradesh General 10.94 Commercial Tax Officer, Sales Tax Act, 1957 Andhra Pradesh (Central)

Uttar Pradesh Trade 0.58 Deputy Commissioner Tax Act, 1948 (Assessment), Uttar Pradesh

Tamilnadu Commercial 71.62 Tamil Nadu Sales Tax Tax Act Appellate Tribunal Main Branch, Chennai

Gujarat State Sales Tax 2.78 Deputy Commissioner Act, 1969 (Appeals), Gujarat

Central Excise Act, 1944 5.82 Andhra Pradesh, High Court

U P Municipal Laws (Cess Act) 0.60 Tehsildar, Gaziabad, (U.P.)

* Net of payments

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash loss in the current year.

(xi) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. We have been informed that the Company has not issued any debenture during the year.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xii) In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society, therefore, the provisions of clause 4 (xiii) of the Companies (Auditor's Report) Order,2003 (as amended), are not applicable to the Company.

(xiv) The Company does not deal or trade in shares, securities, debentures and other securities except that it has investments in shares / bonds and these are held in the name of the Company.

(xv) According to the information and explanations given to us, the Company has not given any corporate guarantee in favour of financial institution/bank for loans taken by others

(xvi) Based on information and explanations given to us, no term loan was obtained during the year.

(xvii) According to the information and explanation given to us, on an overall examination of the balance sheet and cash flow 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 or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has raised Rs. 43.88 Lacs through the Rights Issue during the year and end use of money disclosed in Note No. 15 of Schedule No. 24 and the same has been verified by us.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of the audit.

For SINGHI & CO. Chartered Accountants Firm Registration No. : 302049E

B.K.Sipani Partner Membership No. 088926

Place : New Delhi Dated : 27th May, 2011

Mar 31, 2010

We have audited the attached Balance Sheet of ECE INDUSTRIES LIMITED, as at 31st March, 2010 and also the Profit and Loss account and 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.

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

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

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

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

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

ill. The Balance Sheet, Profit and Loss account and Cash Flow statement dealt with by this report are in agreement with the books of account;

iv. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

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

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with 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;

a) In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2010.

b) In the case of the Profit and Loss account, of the profit of the company for the year ended on that date; and

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

Annexure referred to in paragraph 3 of our report of even date to the shareholders Re: ECE Industries Limited

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

b. Fixed Assets have been physically verified by the management during the year as per regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on physical verification carried out during the year.

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

(ii) a. As explained to us inventories (except stock - in-transit) were physically verified during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, 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.

c. In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) a. As informed, the Company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (b), (c) and (d) of the Companies (Auditors Report) Order, 2003 (as amended) (herein referred to as the order), are not applicable.

e. As informed, the Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraphs 4 (iii) (f) and (g) of the order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in internal control system.

(v) According to the information and explanations provided by the management, we are of the opinion that there are no transactions that needs to be entered into the Register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (v) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the company.

(vi) The Company has not accepted any deposits from the public with in the meaning of Section 58A of the Companies Act, 1956.

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

(viii) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records for its transformer division under section 209(1 )(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) a. According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, services tax, custom duty, excise duty, cess and other statutory dues applicable to it with the appropriate authorities. There was no undisputed outstanding statutory dues as at the year end for a period of more than six months from the date they became payable.

b. According to the records of the Company, there are no dues outstanding of sales tax, income tax, service tax, custom tax, wealth tax, excise duty and cess on account of any dispute, other than the following:

Name of The Statute Nature of Dues Year

Orissa Sales Tax Act, 1947 Demand Towards Work 1997-99 & Contract Tax 2001-02

Bihar Sales Tax Act, 1983 Demand Towards Work 1993-97 & Contract Tax 2000-01

Andhra Pradesh General Demand towards negative 1995-96 Sales Tax Act, 1957 (Local) price variation

Andhra Pradesh General Demand towards negative 1994-95 Sales Tax Act, 1957 (Local) price variation andinterest on delayed payment

Andhra Pradesh General Demand towards interest 1998-99 Sales Tax Act, 1957 (Local) on delayed payment

Andhra Pradesh General Demand towards non submission 1989-90 Sales Tax Act, 1957 (Central) of forms/ Concessional forms & 1998-99

Andhra Pradesh General Demand towards Works 1994-95 & Sales TaxAct, 1957 (Central) Contract Tax 1995-96

Andhra Pradesh General Demand towards non submission 1995-96 Sales Tax Act, 1957 (Central) of forms/ Concessional forms

West Bengal Sales Tax Act, Demand towards Local 1994-97 & 1994 (Local) & Central Sales Tax & Central Sales Tax 2002-03

Delhi Works Contract Act, 1999 Demand Towards Work 2002-03 & Contract Tax 2004-05

Delhi Sales Tax Act, 1975 Demand towards non 1980-81,1983-84, (Central) submission of forms/ 1989-90,1995-96 Concessional forms, and and 1981-82 demand towards interest

Delhi Sales Tax Act, 1975 Demand towards rejection 1980-81 & (local) of Stock transfer and 1987-88 non submission of forms

Kerala State Sales Demand towards Works 1997-98,1998-99 Tax Act, 1963 Contract Tax 1999-2000

Andhra Pradesh General Demand towards Works 2002-03 Sales Tax Act, 1957 (Central) Contract Tax

M.P Trade Tax Act Demand towards M.P 2002-03 Sales Tax

Uttar Pradesh Trade Demand towards Non-Submission 2003-04,2004-05 Tax Act, 1948 of Forms/ Concessional Forms 2005-06, 2006-07

Tamilnadu Commercial Commercial Tax 2000-01 Tax Act

Gujarat State Sales Tax Demand towards work 1993-94 Act, 1969 contract tax

Name of The Statute Amount Forum where dispute is Pending (Rs.in Lacs)*

Orissa Sales Tax Act, 1947 26.24 Sales Tax Appellate Tribunal, Cuttack

Bihar Sales Tax Act, 1983 21.96 Jharkhand High Court

Andhra Pradesh General 2.20 Commercial Tax Officer, Vizag Sales Tax Act, 1957 (Local)

Andhra Pradesh General 14.59 Commercial Tax Officer, Sales Tax Act, 1957 (Local) Sales Tax Andhra Pradesh

Andhra Pradesh General 0.54 Additional Commissioner, Sales Tax Act, 1957 (Local) Hyderabad

Andhra Pradesh General 0.25 Sales Tax Appellate Tribunal, Sales Tax Act, 1957 (Central) Hyderabad

Andhra Pradesh General 7.03 Dy. Commissioner Sales Tax Act, 1957 (Central) Reassessment, Andhra Pradesh

Andhra Pradesh General 4.81 Commercial Tax Officer, Sales Tax Act, 1957 (Central) Andhra Pradesh

West Bengal Sales Tax Act, 15.26 Sales Tax Revision Bench, 1994 (Local) & Central West Bengal

Delhi Works Contract Act, 1999 20.43 Deputy Commissioner Appeal, Delhi

Delhi Sales Tax Act, 1975 13.95 Additional Commissioner (Central) Sales Tax, Delhi

Delhi Sales Tax Act, 1975 3.55 Deputy Commissioner (local) Sales Tax, Delhi

Kerala State Sales 15.06 Assistant Commissioner Tax Act, 1963 Commercial Taxes, Emakulam

Andhra Pradesh General 3.62 Commercial Tax Officer, Sales Tax Act, 1957(Central) Andhra Pradesh

M.P. Trade Tax Act 16.00 Deputy Commissioner (Assessment), M.P.

Uttar Pradesh Trade 14.00 Deputy Commissioner Tax Act, 1948 (Assessment), Uttar Pradesh

Tamilnadu Commercial 49.85 Tamil Nadu Sales Tax Tax Act Appellate Tribunal Main Branch, Chennai

Gujarat State Sales Tax 2.78 Deputy Commissioner Act, 1969 Appeals, Gujarat

* Net of payments

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash loss in the current year.

(xi) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. We have been informed that the Company has not issued any debenture during the year.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

(xiv) The Company does not deal or trade in shares, securities, debentures and other securities except that it has investments in shares / bonds and these are held in the name of the Company.

(xv) According to the information and explanations given to us, the Company has not given any corporate guarantee in favour of financial institution/bank for loans taken by others

(xvi) Based on information and explanations given to us, no term loan was obtained during the year.

(xvii) According to the information and explanation given to us, on an overall examination of the balance sheet and cash flow 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 or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money through a public issue during the year.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of the audit.

For SINGHI & CO. Chartered Accountants Firm Registration No.: 302049E

B.K.Sipani Place : New Delhi Partner

Dated : 31st July, 2010 Membership No. 88926

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