Auditor Report of Invigorated Business Consulting Ltd.

Mar 31, 2025

We have audited the accompanying standalone financial statements of Invigorated Business Consulting Limited
(Formerly Escorts Finance Limited) ("the Company") which comprises the Balance Sheet as at 31 March
2025, the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity
and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of
significant accounting policies and other explanatory information (hereinafter referred to as "the standalone financial
statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid
standalone financial statements give the information required by the Companies Act, 2013 ("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 31 March 2025 and loss, total comprehensive income, the changes in equity
and its cash flows for the year ended on that date.

Basis for Opinion

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

Information Other than the Standalone Financial Statements and Auditor''s Report Thereon

The Company''s Management and Board of Directors are responsible for the other information. The other information
comprises the information included in the Company''s annual report, but does not include the standalone financial
statements and our auditor''s report thereon. The Company''s annual report is expected to made available to us after
the date of this auditor''s report.

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

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

When we read the Company''s annual report, If we conclude that there is a material misstatement therein, we are
required to communicate the matters to those charged with governance and take necessary actions, as applicable
under the relevant law and regulations.

Management''s and Board of Director''s Responsibilities for the Standalone Financial Statements

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

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

The Board of Directors is also responsible for overseeing the company''s financial reporting process.

Auditor''s Responsibilities for the Audit of Standalone Ind AS Financial Statement

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

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

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

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

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the Management and Board of Directors.

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

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the
disclosures, and whether the standalone financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.

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

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

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

Emphasis of Matters

(a) the Company had accumulated losses at the close of the financial year with its net worth continuing to stand
fully eroded and, however, the financial statements have been prepared on a going concern basis for reasons
explained by the management, including the possibilities of considering various options to undertake suitable
business(s) and exploring the options of revival or restructuring of the Company. We have relied on the
representation made to us by the management.

(b) the Escorts Benefit Trust on behalf of the Company had deposited entire outstanding liability towards unclaimed
fixed deposits and interest thereon of Rs. 1056.22 with the Investor Education & Protection Fund on 2 February
2022.

(c) the Company is no longer registered with Reserve Bank of India (RBI) as Non-Banking Financial Institution
(NBFI) after cancellation of it''s earlier registration vide RBI letter no DNBS(NDI) S.3242/MSA/06.05.001/2015-
16 dated 6th May 2016. Accordingly, the related provisions pertaining to NBFI are currently not applicable to the
Company.

(d) the name of the Company has been changed to Invigorated Business Consulting Limited from Escorts Finance
Limited with effect from 14 June 2023, in accordance with the special resolution passed at the Annual General
Meeting of the Company, held on 30 September 2022, pursuant to the directions of Reserve Bank of India (RBI)
received vide its letter dated 12 May 2022, directing to change the name of the Company not reflecting financial
business activities.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order"), issued by the Central Government
of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the "Annexure A"
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, based on our audit we report, to the extent applicable that:

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

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

(c) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), Statement
of change in equity and the Statement of Cash Flow dealt with by this Report are in agreement with the
books of account.

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

(e) The matter described in sub-paragraph (a) under the Emphasis of Matters paragraph above, in our opinion,
may have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on 31 March 2025 taken on
record by the Board of Directors, none of the directors is disqualified as on 31 March 2025 from being
appointed as a director in terms of Section 164 (2) of the Act.

(g) With respect to the adequacy of the Internal Financial Control with reference to Standalone Financial
Statements of the Company and the operating effectiveness of such controls, refer to our separate Report
in the "Annexure B".

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone
financial statements - Refer Note 23(c) to the Standalone financial statements;

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

iii. The Company has deposited amount of Rs. 1056.22 lacs to the Investor Education and Protection
Fund against unpaid fixed deposit liabilities including interest thereon as referred to in Note 34 to the
Standalone financial statements.

iv. > The management has represented that, to the best of its knowledge and belief, no funds have

been advanced or loaned or invested (either from borrowed funds or share premium or any other
sources or kind of funds) by the Company to or in any other persons or entities, including foreign
entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that
the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities
identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Company or
provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries;

> The management has represented, that, to the best of its knowledge and belief, no funds have
been received by the Company from any persons or entities, including foreign entities ("Funding
Parties"), with the understanding, whether recorded in writing or otherwise, that the Company
shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any
manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Funding Party or provide any
guarantee, security or the like from or on behalf of the Ultimate Beneficiaries; and

> Based on such audit procedures as considered reasonable and appropriate in the circumstances,
nothing has come to our notice that has caused us to believe that the representations under
subclause (a) and (b) above contain any material mis-statement.

v. The Company has not declared or paid any dividend during the year ended 31 March 2025.

(i) With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements
of section 197(16) of the Act, as amended:

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

(j) Based on our examination which included test checks, the Company has used an accounting
software for maintaining its books of account for the financial year ended 31 March 2025,
which does not have a feature of recording audit trail (edit log) facility. Further, the audit
trail has not been preserved by the Company as per the statutory requirements for record
retention.

For Kapish Jain & Associates,

Chartered Accountants
Firm''s Registration No.: 022743N

Kapish Jain

Partner

Membership No.: 514162
UDIN: 25514162BMJVCK4323

Place: Faridabad
Date: 05^th May 2025

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Mar 31, 2024

We have audited the accompanying standalone financial statements of Invigorated Business Consulting Limited (Formerly Escorts Finance Limited) ("the Company") which comprises the Balance Sheet as at 31 March 2024, the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 ("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 31 March 2024 and loss, total comprehensive income, the changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

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

Information Other than the Standalone Financial Statements and Auditor''s Report Thereon

The Company''s Management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company''s annual report, but does not include the standalone financial statements and our auditor''s report thereon. The Company''s annual report is expected to made available to us after the date of this auditor''s report.

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

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

When we read the Company''s annual report, If we conclude that there is a material misstatement therein, we are required to communicate the matters to those charged with governance and take necessary actions, as applicable under the relevant law and regulations.

Management''s and Board of Director''s Responsibilities for the Standalone Financial Statements

The Company''s Management and Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view

of the financial position, financial performance, including other comprehensive income, changes in equity and cash flows of the Company in accordance with accounting principles generally accepted in India, including Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate of accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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

The Board of Directors is also responsible for overseeing the company''s financial reporting process.

Auditor''s Responsibilities for the Audit of Standalone Ind AS Financial Statement

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

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

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

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

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management and Board of Directors.

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

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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

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

Emphasis of Matters

(a) the Company had accumulated losses at the close of the financial year with its net worth continuing to stand fully eroded and, however, the financial statements have been prepared on a going concern basis for reasons explained by the management, including the possibilities of considering various options to undertake suitable business(s) and exploring the options of revival or restructuring of the Company. We have relied on the representation made to us by the management.

(b) the Escorts Benefit Trust on behalf of the Company had deposited entire outstanding liability towards unclaimed fixed deposits and interest thereon of Rs. 1056.22 with the Investor Education & Protection Fund on 2 February 2022.

(c) the Company is no longer registered with Reserve Bank of India (RBI) as Non-Banking Financial Institution (NBFI) after cancellation of it''s earlier registration vide RBI letter no DNBS(NDI) S.3242/MSA/06.05.001/2015-16 dated 6th May 2016. Accordingly, the related provisions pertaining to NBFI are currently not applicable to the Company.

(d) the name of the Company has been changed to Invigorated Business Consulting Limited from Escorts Finance Limited with effect from 14 June 2023, in accordance with the special resolution passed at the Annual General Meeting of the Company, held on 30 September 2022, pursuant to the directions of Reserve Bank of India (RBI) received vide its letter dated 12 May 2022, directing to change the name of the Company not reflecting financial business activities.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the "Annexure A" 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, based on our audit we report, to the extent applicable that:

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

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

(c) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), Statement of change in equity and the Statement of Cash Flow dealt with by this Report are in agreement with the books of account.

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

(e) The matter described in sub-paragraph (a) under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on 31 March 2024 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2024 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) With respect to the adequacy of the Internal Financial Control with reference to Standalone Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in the "Annexure B".

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 23(c) to the Standalone financial statements;

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

iii. The Company has deposited amount of Rs. 1056.22 lacs to the Investor Education and Protection Fund against unpaid fixed deposit liabilities including interest thereon as referred to in Note 34 to the Standalone financial statements.

iv. > The management has represented that, to the best of its knowledge and belief, no funds have

been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other persons or entities, including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Company or provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries;

> The management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Funding Party or provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries; and

> Based on such audit procedures as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under subclause (a) and (b) above contain any material mis-statement.

v. The Company has not declared or paid any dividend during the year ended 31 March 2024.

(i) With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended:

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

(j) Based on our examination which included test checks, the Company has used an accounting software for maintaining its books of account for the financial year ended 31 March 2024, which does not have a feature of recording audit trail (edit log) facility. Consequently, we are unable to comment on audit trail requirements of the said software, as envisaged under Rule 11 (g) of the Companies (Audit and Auditors) Rules, 2014, as amended.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, as amended is applicable for the Company only w.e.f. 1 April 2023, therefore, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014, as amended, on preservation of audit trail as per the statutory requirements for record retention is not applicable for financial year ended 31 March 2024.

For Kapish Jain & Associates,

Chartered Accountants Firm''s Registration No.: 022743N

Kapish Jain

Partner

Membership No.: 514162 UDIN: 24514162BKBHUX8530

Place: Faridabad Date: 29 April 2024

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Mar 31, 2016

To the Members of Escorts Finance Limited

1. Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Escorts Finance Limited (''the Company"), which comprise the balance sheet as at 31st March 2016, the statement of profit and loss and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

2. Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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.

3. Auditor''s Responsibility

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

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

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are 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. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

4. Basis of Qualified Opinion

Attention is invited to the following matters in the Notes to the Financial Statements:

i. Note No. 21, regarding non-maintenance of investments in Government Securities as liquid assets in terms of Section 45-IB of Reserve Bank of India Act, 1934;

ii. Note No. 22, regarding non-maintenance of minimum capital adequacy ratio working out to -6517.79 (negative) as against 37.77 required to be maintained in terms of Non-Banking Financial Companies requirements;

iii. Note No. 24, regarding the Company''s credit rating not sought post November 2005;

iv. Note No. 25, regarding unpaid/unclaimed matured Fixed Deposit Liability aggregating to Rs.1278.78 lakhs as on balance sheet date;

v. Note No. 29, regarding non-provision of preference dividend on cumulative preference shares amounting to Rs.95.00 lakhs for the year;

vi. Note No. 30, regarding non-determination of Employee Terminal Benefits on actuarial basis. In the absence of the same, the exact impact cannot be ascertained in the books of accounts.

5. Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effect of the matter described in sub-paragraph (iv), (v) and (vi) under the Basis for Qualified Opinion above,

the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2016 and its profit and its cash flow for the year ended on that date.

6. Emphasis of Matters

We draw attention to the following matters in the Notes to the Financial Statements;

(a) Note No. 27 in the financial statements which indicates that the Company had accumulated losses at the close of the financial year with its net worth continuing to stand fully eroded and the financial statements have been prepared on going concern basis for reasons explained by the management, including the possibilities of venturing into newer business areas. We have relied on the representation made to us by the management.

(b) Note No. 23 in the financial statements which states that the company had filed an application with the Reserve Bank of India for de-registration of its NBFC status and accordingly Certificate of Registration (COR) had also been surrendered. Subsequent to the balance sheet date of 31st March 2016, the approval for de-registration of the NBFC Status of the Company has been received vide letter dated 06th May 2016.

Our opinion is not qualified in respect of the above matters.

7. Report on Other Legal and Regulatory Requirements

A. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in the paragraph 3 and 4 of the order.

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

(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

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

(c) the balance sheet, the statement of profit and loss and the cash flow statement dealt with by this Report are in agreement with the books of account;

(d) except for the effect of the matters described in sub-paragraph (iv), (v) and (vi) under the Basis for Qualified Opinion above, in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

(e) The matter described in sub-paragraph (a) under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on functioning of the Company;

(f) on the basis of the written representations received from the directors as on 31st March 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2016 from being appointed as a director in terms of Section 164 (2) of the Act;

(g) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B"; and

(h) 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 made disclosure regarding pending litigations in its standalone financial statements, as referred to in Note No. 20 to the financial statements including claims against the Company for which amount is presently not ascertainable;

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

iii. The Company has not deposited amounts to the Investor Education and Protection Fund against unpaid fixed deposit liabilities including interest thereon as referred to in Note No. 25 to the financial statements.

ANNEXURE - A TO THE INDEPENDENT AUDITORS'' REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF ESCORTS FINANCE LIMITED

(Referred to in sub para A of Para 7 under the heading of "Report on Other Legal and Regulatory Requirements")

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

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, it does not hold any immovable properties. Thus, Clause (i) (c) of the Order is not applicable to the Company.

(ii) In view of the nature of the operations of the Company, the Company does not hold any inventory other than stock of repossessed assets, which have been verified by the management during the year. Provision has been made in respect of discrepancies / diminution in the value of such stock as at the end of the year end;

(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Consequently, Clause (iii)(a), (iii)(b) and (iii)(c) of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, the Company has not dealt with any loans, guarantee, investments and security under the provision of section 185 and 186 of the Companies Act 2013. Consequently, Clause (iv) of the Order is not applicable to the Company.

(v) In respect of accepted of any deposits from the public, in our opinion and according to the information and explanation given to us, the directives issued by Reserve Bank of India and the provisions of Section 73 to 76 or any other relevant provisions of the Companies Act, 2013, the Company had not complied with the said norms in relation to repayment of deposit on their respective maturity dates. However, in accordance with the Hon''ble Delhi High Court''s Order / direction dated March 04, 2011, Escorts Benefit Trust (EBT) created by Escorts Limited, repaid matured fixed deposit liability against the claims received till March 03, 2013. Claims received after said dates are also being entertained and settled after due verification. As at March 31, 2016, the unpaid/unclaimed matured fixed deposits liability (including interest thereon) is Rs. 1278.78 lacs (Previous Year Rs. 1357.40 lacs).

(vi) In our opinion and according to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company. Consequently, Clause (vi) of the Order is not applicable to the Company.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the books of

accounts, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employee State Insurance, Income-Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, value added tax, cess and other statutory dues, during the year with the appropriate authorities.

According to the information and explanations given to us, and on the basis of our examination of the books of account, no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income-Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Cess were in arrears, as at 31 March 2016, for a period of more than six months from the date they became payable except income tax liability amounting to Rs. 22.25 lacs.

(b) According to the information and explanations given to us, there are following dues of Income-Tax, Value Added Tax and other material Statutory Dues which have not been deposited with the appropriate authorities on account of any dispute.

S. No.	Nature of Statutory Dues	Period to which the amount relates	Forum where Dispute is pending	Unpaid Amount (in Rs. Lacs)
1	Income Tax	AY 2004-2005	DCIT, New Delhi	34.94
		AY 2005-2006	DCIT, New Delhi	131.34
2	Value Added Tax	AY 2001-2002	AC Appeal, Kolkata	2.26
		AY 1994-1995	DC Appeal, Noida	0.54
		AY 1999-2001	AC Appeal, Jaipur	1.52

(viii) The Company does not have any loans or borrowings from any financial institution, banks, government or debenture holders during the year. Accordingly, Clause (viii) of the Order is not applicable.

(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, Clause (ix) of the Order is not applicable.

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

(xi) In our opinion and according to the information and explanations given to us, no managerial remuneration has been paid or provided by the Company. Accordingly, Clause (xi) of the Order is not applicable.

(xii) To the best of our knowledge and belief and according to the information and explanations given to us, the

Company is not a Nidhi company. Consequently, Clause (xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions 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 under review; consequently, the requirements of clause (xiv) of the Order are not applicable to the Company.

(xv) To the best of our knowledge and belief and according to the information and explanations given to us, the

Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, Clause (xv) of the Order is not applicable to the Company.

(xvi) To the best of our knowledge and belief and according to the information and explanations given to us, the Company which is registered under section 45-IA of the Reserve Bank of India Act, 1934. had filed an application with the Reserve Bank of India for de-registration of its NBFC status and accordingly Certificate of Registration (COR) had also been surrendered. Subsequent to the balance sheet date of 31st March 2016, the approval for de-registration of the NBFC Status of the Company has been received vide letter dated 06th May 2016.

ANNEXURE - B TO THE INDEPENDENT AUDITOR''S REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF ESCORTS FINANCE LIMITED

(Referred to in Clause (g), sub para B of Para 7 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

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

We were engaged to audit the internal financial controls over financial reporting of ESCORTS FINANCE LIMITED ("the Company") as at March 31, 2016, in conjunction with our audit of the standalone financial statements of the Company for the period ended on that date.

2. 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 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 Companies Act, 2013.

3. Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit conducted in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, to the extent applicable to an audit of internal financial controls, both issued by the Institute of Chartered Accountants of India.

Because of the matter described in the Disclaimer of Opinion paragraph below , we were unable to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on internal financial controls system over financial reporting of the company.

4. Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of 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.

5. Disclaimer of Opinion

According to information and explanations given to us, the Company has not established its internal financial controls over financial reporting on criteria based on or 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. Because of this reason, we are unable to obtain sufficient appropriate evidence to provide a basis for our opinion whether the Company had adequate internal financial controls over financial reporting, and whether such internal financial controls were operating effectively as at March 31, 2016.

We have considered the disclaimer reported above in determining the nature, timing, and extent of audit tests applied in our audit of the standalone financial statements of the company and the disclaimer does not affect our opinion on the standalone financial statements of the Company

For N.M.Raiji and Co.

Chartered Accountants

ICAI Firm Registration number: 108296W

Sd/-

CA. S. N. Shivakumar

Place: Faridabad Partner

Date: 30th May, 2016 Membership No. 088113

---

Mar 31, 2015

We have audited the accompanying standalone financial statements of Escorts Finance Limited ('the Company1), which comprise the Balance Sheet as at March 31, 2015, the statement of Profit and Loss and the Cash Flow Statement for the year then ended and summary of significant accounting policies and other explanatory information.

2. Management's Responsibility for the Standalone Financial Statements

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

3. Auditor's Responsibility

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

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

We conducted out 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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone 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 standalone 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 standalone financial statements.

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

4. Basis of Qualified Opinion

Attention is invited to the following matters in the Notes to the Standalone Financial Statements:

i. Note No. 21, regarding non-maintenance of investments in Government Securities as liquid assets in terms of Section 45-IB of Reserve Bank of India Act, 1934;

ii. Note No. 22, regarding non-maintenance of minimum capital adequacy ratio required to be maintained in terms of Non-Banking Financial Companies requirements;

iii. Note No. 24, regarding the Company's credit rating;

iv. Note No. 25, regarding unpaid/unclaimed matured Fixed Deposit Liability;

v. Note No. 29, regarding non-provision of preference dividend on cumulative preference shares;

vi. Note No. 30, regarding non-determination of Employee Terminal Benefits on actuarial basis.

5. Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effect of the matter described in sub-paragraphs (iv), (v) and (vi) of Paragraph 4 under the Basis for Qualified Opinion above, the aforesaid standalone financial statements give the information required by the Act, in the manner so required, and give a true and fair view, in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2015, and its Loss and its cash flows for the year ended on that date.

6. Other Matters

The Company had filed an application with Reserve Bank of India for deregistration of its NBFC status and accordingly Certificate of Registration has been surrendered.

7. Report on Other Legal and Regulatory Requirements

A. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in the terms of sub section (11) of Section 143 of the Companies Act 2013, we give in the Annexure a statement on the matters specified in Paragraph 3 & 4 of the order, to the extent applicable.

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

(i) 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.

(ii) 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.

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

(iv) Except for the effect of the matters described in sub-paragraphs (iv), (v) and (vi) of Paragraph 4 under the Basis for Qualified Opinion above, in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

(vi) With respect of 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:

a) The Company has made disclosure regarding pending litigations in its standalone financial statements, the amount of which is stated to be presently unascertainable, as referred to in Note No. 20(b) to the Financial Statements;

b) The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses;

c) The Company has not deposited amounts to the Investor Education and Protection Fund against unpaid fixed deposit liabilities including interest thereon, as referred to in Note No. 25 to the Financial Statements;

ANNEXURE TO THE INDEPENDENT AUDITORS REPORT

(Referred to in Paragraph 5 (A) of our report of even date)

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

(b) The Company has a regular program of physical verification of its fixed assets by which all fixed assets are verified at reasonable intervals. In our opinion, the frequency of physical verification is reasonable having regard to the size of the Company and the nature of its assets. As informed to us, no material discrepancies were noticed on such verification.

(ii) In view of the nature of the operations of the Company, the Company does not hold any inventory other than stock of repossessed assets, which have been verified by the management during the year. Provision has been made in respect of discrepancies / diminution in the value of such stock as at the end of the year end;

(iii) During the year, the Company has not granted loans to bodies corporate covered in the register maintained under section 189 of the Companies Act, 2013 (The Act'). Accordingly, paragraph 3(iii)(a) and (b) of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems, commensurate with the size of the Company and the limited nature of its business in relation to fixed assets. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have not observed any major weakness in the internal control system during the course of the audit.

(v) In respect of deposits accepted from the public, in our opinion and according to the information and explanation given to us, the directives issued by Reserve Bank of India and the provisions of Section 73 to 76 or any other relevant provisions of the Companies Act, 2013, the Company had not complied with the said norms in relation to repayment of deposit on their respective maturity dates. However, In accordance with the Hon'ble Delhi High Court's Order / direction dated March 04, 2011, Escorts Benefit Trust (EBT) created by Escorts Limited, repaid matured fixed deposit liability against the claims received till March 03, 2013. Claims received after said dates are also being entertained and settled after due verification. As at March 31, 2015, the unpaid/unclaimed matured fixed deposits liability (including interest thereon) is Rs. 1357.40 lacs (Previous Year Rs. 1606.08 lacs).

(vi) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under sub-section (1) to Section 148 of the Companies Act, 2013, in respect of any of the activities of the Company.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the

Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Income-Tax, Service Tax, Wealth Tax, Value Added Tax, ESIC and other material Statutory Dues have generally been regularly deposited during the year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty and Customs duty.

According to the information and explanations given to us, and on the basis of our examination of the books of account, no undisputed amounts payable in respect of Provident Fund, Employees State insurance , Income-Tax, Sales Tax,, Wealth Tax, Service Tax, Customs duty, Excise Duty,Value Added Tax, cess were in arrears, as at 31 March 2015, for a period of more than six months from the date they became payable except income tax liability amounting to Rs. 22.25 lacs.

(b) According to the information and explanations given to us, there are following dues of Income-Tax, Value Added Tax and other material Statutory Dues which have not been deposited with the appropriate authorities on account of any dispute.

Sl Nature of Period to Forum where Unpaid No. Statutory which the dispute is Amount Dues amount pending (in Rs. relates Lacs)

1 Income Tax AY 2004-05 DCIT, New Delhi 34.94 AY 2005-06 DCIT, New Delhi 131.34

2 Value Added Tax AY 2001-02 AC Appeal, Kolkata 2.26

AY 1994-95 DC Appeal, Noida 0.54

AY 1999-01 AC Appeal, Jaipur 1.52

(c) The Company has not deposited amounts of Rs. 1357.40 lacs to the Investor Education & Protection Fund against unpaid fixed deposit liabilities including interest thereon.

(viii) The Company has accumulated losses at the end of the financial year and also has incurred losses during the year. The net worth of the Company continues to stand fully eroded as at the end of the financial year.

(ix) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to the financial institutions or banks. The Company does not have any outstanding debentures.

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

(xi) According to the information and explanations given to us, no term loan has been obtained by the Company during the year.

(xii) To the best of our knowledge and belief and according to the information and explanations given to us, no material frauds on or by the Company was noticed or reported during the year.

For N.M. Raiji & Co., Chartered Accountants Firm Regn. No. 108296W



CA S N Shivakumar Place: Faridabad Partner Dated:26th May,2015 M.No.088113

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Mar 31, 2014

1. Report on the Financial Statements

We have audited the accompanying financial statements of Escorts Finance Limited (''the Company''), which comprise the Balance Sheet as at March 31, 2014, and the Profit and Loss Statement and Cash Flow Statement for the year ended on that date, and a summary of significant accounting policies and other explanatory information.

2. Management''s Responsibility for the Financial Statements

Management of the Company is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flow 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 misstatements, whether due to fraud or error.

3. Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those standards require that we comply with ethical requirement 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 amount and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and reasonableness of the accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion.

4. Basis for Qualified Opinion

Attention is invited to the following Notes to the Financial Statements:

(i) Note 21, regarding non-maintenance of investments in Government Securities as liquid assets in terms of Section 45-IB of Reserve Bank of India Act, 1934;

(ii) Note 22, regarding non-maintenance of minimum Capital Adequacy Ratio required to be maintained in terms of Non-Banking Financial Companies requirements;

(iii) Note 24, regarding the Company''s credit rating;

(iv) Note 25, regarding unpaid/unclaimed matured Fixed Deposit liability;

(v) Note 29, regarding non-provision of preference dividend on cumulative preference shares;

(vi) Note 30, regarding non-determination of Employees Terminal Benefits on actuarial basis.

5. Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effect of the matter described in paragraph 4(iv), 4(v) and 4(vi) of basis for Qualified Opinion above, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

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

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

6. Other Matters

The Company has filed an application with Reserve Bank of India for deregistration of its NBFC status and accordingly Certificate of Registration has been surrendered.

7. Report on Other Legal and Regulatory Requirements

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

(ii) Further to our comments in the Annexure referred to in Paragraph 6(i) above, as required by 227(3) of the Act, we report that;

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

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

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

d. Except for the effect of the matter described in paragraph 4(iv), 4(v) and 4(vi) of basis for Qualified Opinion above, in our opinion, the Balance Sheet, Profit and Loss Statement and Cash Flow Statement dealt herewith comply with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

e. On the basis of the written representations received from the Directors and taken on records by the Board of Directors, none of the Director is disqualified, as at the balance sheet date, from being appointed as Director in terms of section 274(1)(g) of the Companies Act, 1956;

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

ANNEXURE TO THE AUDITOR''S REPORT OF EVEN DATE TO THE MEMBERS OF ESCORTS FINANCE LIMITED

1. (a) The Company has maintained its fixed assets register showing full particulars, including quantitative details and the situation of its fixed assets;

(b) Fixed assets are physically verified by the management at reasonable intervals. In our opinion, the frequency of verification of the fixed assets by the management is reasonable having regard to the size of the Company and the nature of its assets. There was no material discrepancies noticed during such verification;

(c) The assets disposed off during the year are not significant and therefore do not affect the going concern assumption;

2. In view of the nature of the operations of the Company, the Company does not hold any inventory other than stock of repossessed assets, which have been verified by the management during the year. Provision has been made in respect of discrepancies/diminution in the value of such stock as at the year end;

3. (a) During the year, the Company has not granted any loans, secured or unsecured, to Companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the above, clause 4(iii) (b), (c) and (d) of the Order are not applicable to the Company;

(b) During the year, the Company has not taken any loans, secured or unsecured, from companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the above, clause 4(iii) (f) and (g) of the Order are not applicable to the Company;

4. In our opinion and according to the information and explanations provided to us there are adequate internal control procedures commensurate with the size of the Company and the limited nature of its business in relation to fixed assets. In our opinion, internal controls need to be strengthened in relation to other areas.

5. In our opinion and according to the information and explanations given to us, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of Companies Act, 1956. Accordingly clause

(v) (a) of the Order is not applicable to the Company;

6. In respect of deposits accepted, in our opinion and according to the information and explanation given to us, the directives issued by Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 the Company had not complied with the said norms in relation to repayment of deposits on their respective maturity dates. However, In accordance with the Hon''ble Delhi High Court''s Order/direction dated 4th March 2011, Escorts Benefit Trust (EBT) created by Escorts Limited, repaid matured fixed deposit liability against the claims received till 3rd March 2013. Claims received after said date are also being entertained and settled after due verification. As at 31st March 2014, the unpaid/unclaimed matured fixed deposits liability (including interest thereon) is Rs. 1606.08 lacs (Previous Year Rs. 1747.43 lacs).

7. The internal audit system of the Company, in our opinion, needs to be considerably strengthened;

8. In view of nature of business of the Company, the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 has not been prescribed by the Central Government; DCIT

9. (a) According to the records, information and explanations provided to us, the Company is generally regular in depositing with appropriate authorities undisputed amount of provident fund, investor education protection fund, employee''s state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other statutory dues applicable to it and no undisputed amounts payable were outstanding as at 31st March, 2014 for a period of more than six months from the date they became payable except income tax liability amounting to Rs. 22.25 lacs;

(b) The following are the details of disputed Income Tax and Sales Tax that have not been paid to the concerned authorities:

Nature of Period to Forum where Unpaid Amount Statutory which the dispute is (in Rs. Lacs) Dues amount relates pending

1 Income Tax AY 2004-05 DCIT, New Delhi 34.94

AY 2005-06 DCIT, New Delhi 131.34

2 Sales Tax AY 2001-02 AC Appeal, Kolkata 2.26

AY 1994-95 DC Appeal, Noida 0.54

AY 1999-01 AC Appeal, Jaipur 1.52

10. Although the Company has made profit during the year, it has accumulated losses as at end of financial year and also has incurred losses in the immediately preceding financial year. The net worth of the Company continues to stand fully eroded as at the end of the financial year;

11. Based on our audit procedures and as per the information and explanations given by the management, the Company has not defaulted in repayment of dues to any financial institution or bank;

12. Based on our examination and according to the information and explanations given 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;

13. As explained to us, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/Societies are not applicable to the Company;

14. The Company is not dealing or trading in shares, securities, debentures and other investments;

15. On the basis of the information and explanations given to us the Company has not given any guarantee for loans taken by others from bank or financial institutions;

16. Based on information and explanations given to us by the management, no term loan has been obtained by the company during the year;

17. On the basis of our examination of the books of accounts and as per information and explanations given to us, in our opinion, no funds were raised by the company on short-term basis during the year;

18. During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act;

19. The Company did not have any outstanding debentures during the year;

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

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

For N.M. Raiji & Co., Chartered Accountants Firm Regn. No. 108296W

S.N. Shivakumar Place: Faridabad Partner Dated: 21st May, 2014 M.No. 088113

---

Mar 31, 2012

1. We have audited the attached Balance Sheet of ESCORTS FINANCE LIMITED ("the Company"), as at March 31,2012 and also the Profit and Loss Statement 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.

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

3. As required by the Companies (Auditors' Report) Order, 2003 as amended by the Companies (Auditors' Report) (Amendment) Order 2004 (the Order) 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.

4. Attention is invited to the following Notes to the Financial Statements:

(i) Note 22, regarding non-maintenance of investments in Government Securities as liquid assets in terms of Section 4S-IB of Reserve Bank of India Act,l 934;

(ii) Note 23, regarding discharge of Fixed Deposit holders liabilities by Escorts Limited;

(iii) Note 24, regarding non-verification of investment in securities.

(iv) Note 26, regarding non-maintenance of Minimum Capital Adequacy Ratio required to be maintained in terms of Non-Banking Financial Companies requirements;

(v) Note 27, regarding the Company's credit rating;

(vi) Note 30, regarding trade and related receivables written off during the year against which full provision were held.

(vii) Note 31, regarding non-provision of preference dividend on cumulative preference shares.

(viii) Note 32, regarding non-determination of Employees Terminal Benefits on actuarial basis.

5. Further to our comments in the Annexure referred to in paragraph 3 to 4 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, except for investment referred to in Para 4 (iii) above

(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 accounts;

(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, except where stated otherwise;

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

(vi) subject to our observations in paragraph 4(ii), (iii), (vii) and (viii) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

ANNEXURE TO THE AUDITORS' REPORT OF EVEN DATE TO THE MEMBERS OF ESCORTS FINANCE LIMITED

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

(b) Fixed assets have been physically verified by the management during the year. In our opinion, the frequency of verification of the fixed assets by the management is reasonable having regard to the size of the Company and the nature of its assets. There was no material discrepancies noticed during such verification;

(c) The fixed assets disposed off during the year are not significant and therefore do not affect the Going Concern Assumption;

2. In view of the nature of the operations of the Company, the Company does not hold any inventory other than stock of repossessed assets, which have been verified by the management during the year. Provision has been made in respect of discrepancies/diminution in the value of such stock as at the year end;

3. (a) During the year, the Company has not granted any loans, secured or unsecured, to Companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(b) During the year, the Company has not taken any loans, secured or unsecured, from companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations provided to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for sale of goods/services. In our opinion, internal controls need to be strengthened In relation to other areas.

5. In our opinion and according to the information and explanations given to us, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of Companies Act, 1956.

6. In respect of deposits accepted, in our opinion and according to the information and explanation given to us, the directives issued by Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 the Company had not complied with the said norms in relation to repayment of deposits on their respective maturity dates. However, the fixed deposit liability to the extent of Rs. 141.85 crores out of the total liability of Rs. 162.77 crores has already been discharged by Escorts Limited. As stated in Note 23 to the Financial Statements, the unpaid matured/unclaimed fixed deposit liability (including interest there on) amounting to Rs. 2,091.64 lacs as on 31st March 2012 (Rs. 3,244.69 lacs as on 31st March 2011) shall be met out of funds/assets of requisite value kept with Escorts Benefit Trust created by Escorts Limited in terms of direction of the Hon'ble Delhi High Court, issued while disposing off the Scheme of Compromise and Arrangement filed by the company along with Escorts Limited before the Hon'ble court vide which Escorts Limited had undertaken to bail out the fixed deposit holders and creditors of the Company.

7. The internal audit system of the Company, in our opinion, needs to be strengthened;

8. In view of nature of business of the Company, the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 has not been prescribed by the Central Government;

9. (a) According to the records, information and explanations provided to us, the Company is generally regular in depositing with appropriate authorities undisputed amount of provident fund, investor education protection fund, employee's state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other statutory dues applicable to it and no undisputed amounts payable were outstanding as at 31st March, 2012 for a period of more than six months from the date they became payable except in respect of income tax liability amounting to Rs. 22.25 lacs;

(b) The following are the details of disputed Income Tax and Sales Tax that have not been paid to the concerned authorities:

Nature of Period to which Forum where Unpaid Amount Statutory the amount dispute is (in Rs. Lacs) Dues relates pending

1. Income Tax AY 2004-05 ITAT, New Delhi 34.94

AY 2005-06 ITAT, New Delhi 131.35

2. Sales Tax AY 2001-02 AC Appeal, Kolkata 2.26

AY 1994-95 DC Appeal, Noida 0.54

AY 1999-01 AC Appeal Jaipur 1.52

10. The Company has accumulated losses at the end of the financial year and also has incurred losses during the year. The net worth of the Company continues to stand fully eroded as at the end of the financial year;

11. Based on our audit procedures and as per the information and explanations given by the management, the Company has not defaulted in repayment of dues to any financial institution or bank;

12. Based on our examination and according to the information and explanations given 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;

13. As explained to us, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/Societies are not applicable to the Company;

14. The Company is not dealing or trading in shares, securities, debentures and other investments. However, investment in share of Escorts Assets Management Limited has been reinstated during the year in the books of account (Refer Note 25 to the Financial Statements);

15. On the basis of the information and explanations given to us the Company has not given any guarantee for loans taken by others from bank or financial institutions;

16. Based on information and explanations given to us by the management, no term loan has been obtained by the company during the year;

17. On the basis of our examination of the books of accounts and as per information and explanations given to us, in our opinion, no funds were raised by the company on short-term basis during the year;

18. During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act;

19. The Company did not have any outstanding debentures during the year;

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

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

For N.M. Raiji & Co., Chartered Accountants Firm Regn. No. 108296W

Sd/- S.N. Shivakumar Partner M.No.088113

Place: Faridabad Dated: 14th July, 2012

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of Escorts Finance Limited, as at March 31, 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 Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by the Central Government 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.

4. Attention is invited to:

(i) Note 3 of Schedule 14 Part B, regarding non-maintenance of investments in Government Securities as liquid assets in terms of Section 45-B(1) of Reserve Bank of India Act,1934;

(ii) Note 4 of Schedule 14 Part B, regarding non-verification of investment in securities.

(iii)Note 5 of Schedule 14 Part B, regarding non-maintenance of minimum Capital Adequacy Ratio required to be maintained in terms of Non-Banking Financial Companies requirements;

(iv)Note 6 of Schedule 14 Part B, regarding the Companys credit rating;

(v) Note 7 of Schedule 14 Part B regarding discharge of Fixed Deposit holders liabilities by Escorts Limited;

(vi)Note 9 of Schedule 14 Part B regarding existence/working condition of some of the fixed assets.

(vii) Note 11 of Schedule 14 Part B regarding non-determination of Employees Terminal Benefits on actuarial basis.

(viii) Note 16 of Schedule 14 Part B regarding pending reconciliation of advance tax/ provision for tax/TDS recoverable.

5. Further to our comments in the Annexure referred to in paragraph 3 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 , except for investment referred to in Para 4 (ii) above

(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 accounts,

(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 March 31, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified from being a director in this company. However, the directors of the company are disqualified from being appointed as a director in other companies in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956, and

(vi) subject to our observations in paragraph 4(ii),(v),(vi),(vii) and (viii) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

ANNEXURE TO THE AUDITORS REPORT OF EVEN DATE TO THE MEMBERS OF ESCORTS FINANCE LIMITED

1. (a) The Company has maintained its fixed assets register showing full particulars, including quantitative details and the situation of its fixed assets;

(b) Fixed assets have been physically verified by the management during the year; Consequent upon such verification, fixed assets aggregating to Rs 41.67 lacs ( Gross Value Rs. 841.86Lacs. ) have been written off in the books .

(c) The assets disposed off during the year by the Company amounted to Rs.308.96 lacs at WDV are material . However, this does not affect the going concern assumption;

2. In view of the nature of the operations of the Company, the Company does not hold any inventory other than stock of repossessed assets, which have been verified by the management during the year. Provision has been made in respect of discrepancies/ diminution in the value of such stock as at the year end;

3. (a) During the year, the Company has not granted any loans, secured or unsecured, to Companies, firms or

parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the above, clause 4(iii) (b), (c) and (d) of the Order are not applicable to the Company;

(b) During the year, the Company has not taken any loans, secured or unsecured, from companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the above, clause 4(iii) (f) and (g) of the Order are not applicable to the Company;

4. In our opinion and according to the information and explanations provided to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for sale of goods/ services. In our opinion, internal controls need to be strengthened in relation to other areas.

5. In our opinion and according to the information and explanations given to us, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of Companies Act, 1956. Accordingly clause (v)(a) of the Order is not applicable to the Company;

6. In respect of deposits accepted, in our opinion and according to the information and explanation given to us, the directives issued by Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 the Company had not complied with the said norms in relation to repayment of deposits on their respective maturity dates. However, as stated in Note 7, Schedule 14, Part B, the fixed deposit liability to the extent of Rs. 130.32 crores out of the total liability of Rs. 162.77 crores has already been discharged by Escorts Limited in terms of the Scheme of Compromise and Arrangement filed before the Honble Delhi High Court. For the balance liability of Rs. 32.45 crores, funds/assets of adequate value have been made available by Escorts Limited to a Trust in terms of the direction of the Honble Delhi High Court at the time of permitting the withdrawl of the Scheme /petitions. The Company has transferred the fixed deposit liability in its books of account to the credit of Escorts Limited to the extent of payments made upto 31st March,2011.

7. The internal audit system of the Company, in our opinion, needs to be strengthened;

8. In view of nature of business of the Company, the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 has not been prescribed by the Central Government;

9. (a) According to the records, information and explanations provided to us, the Company is generally regular in depositing with appropriate authorities undisputed amount of provident fund, investor education protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other statutory dues applicable to it and no undisputed amounts payable were outstanding as at 31st March, 2011 for a period of more than six months from the date they became payable;

(b) The following are the details of disputed Income Tax and Sales Tax that have not been paid to the concerned authorities:

Sl Nature of Statutory No Dues Forum where Dispute is Pending Unpaid Amount (in Rs.Lacs)

1 Income Tax CIT (Appeals) 295.83

2 Sales Tax AC Appeal, Kolkata 2.26 DC Appeal, Noida 0.54 DC Appeals Jaipur 1.52

10. Although the Company has made profits during the year, it has accumulated losses as at the end of the financial year and also has incurred losses in the immediately preceding financial year. The net worth of the Company continues to stand fully eroded as at the end of the financial year;

11. Based on our audit procedures and as per the information and explanations given by the management, the Company has not defaulted in repayment of dues to any financial institution or bank;

12. Based on our examination and according to the information and explanations given 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;

13. As explained to us, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/ Societies are not applicable to the Company;

14. The Company is not dealing or trading in shares, securities, debentures and other investments;

15. On the basis of the information and explanations given to us the Company has not given any guarantee for loans taken by others from bank or financial institutions;

16. Based on information and explanations given to us by the management, no term loan has been obtained by the company during the year;

17. On the basis of our examination of the books of accounts and as per information and explanations given to us, in our opinion, no funds were raised by the company on short-term basis during the year;

18. During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act;

19. The Company did not have any outstanding debentures during the year;

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

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

For N.M. Raiji & Co., Chartered Accountants Firm Regn. No. 108296W

S. N. Shivakumar Partner M.No. 88113

Place: Faridabad Date : 4th May, 2011

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of Escorts Finance Limited, as at March 31, 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.

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

3. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by the Central, Government 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.

4. Attention is invited to:

(i) Note 3b of Schedule 15 Part B, regarding non-maintenance of investments in Government Securities as liquid assets in terms of Section 4S-B(1) of Reserve Bank of India Act, 1934;

(ii) Note 4 of Schedule 15 Part B, regarding non-verification of investment in securities.

(iii) Note 5 of Schedule 15 Part B, regarding non-maintenance of minimum Capital Adequacy Ratio required to be maintained in terms of Non-Banking Financial Companies requirements;

(iv) Note 7 of Schedule 15 Part B, regarding the Companys credit rating;

(v) Note 9 of Schedule 15 Part B regarding non-provision of interest for overdue period on matured unpaid fixed deposits;

(vi)Note 10 of Schedule 15 Part B regarding existence/ working condition of some of the fixed assets.

(vii) Note 18 of Schedule 15 Part B regarding reconciliation of advance tax / provision for tax/ TDS recoverable.

5. Further to our comments in the Annexure referred to in paragraph 3 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 accounts,

(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 March 31, 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified from being a Director in this Company. However, the Directors of the Company are disqualified from being appointed as a Director in other companies in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956 and

(vi) subject to our observations in paragraph 4(H), (v), (vi) and (vii) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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



ANNEXURE TO THE AUDITORS REPORT OF EVEN DATE TO THE MEMBERS OF ESCORTS FINANCE LIMITED

1. (a) The Company also needs to update its fixed assets register to show full particulars, including quantitative details and the situation of its fixed, assets;

(b) Fixed assets have not been physically verified by the management during the year;

(c) The assets disposed off during the year were not material and do not affect the going concern assumption;

2. In view of the nature of the operations of the Company, the Company does not hold any inventory other than stock of repossessed assets, which have been verified by the management during the year. Provision has been made in respect of discrepancies/ diminution in the value of such stock as at the year end;

3. (a) During the year, the Company has not granted any loans, secured or unsecured, to Companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the above, clause 4(iii) (b), (c) and (d) of the Order are not applicable to the Company;

(b) During the year, the Company has not taken any loans, secured or unsecured, from companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956. In view of the above, clause 4(iii) (f) and (g) of the Order are not applicable to the Company;

4. In our opinion and according to the information and explanations provided to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for sale of goods/services. In our opinion, internal controls needs to be strengthened in relation to other areas.

5. In our opinion and according to the information and explanations given to us, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of Companies Act, 1956. Accordingly clause (v)(a) of the Order is not applicable to the Company;

6. In respect of deposits accepted, in our opinion and according to the information and explanation given to us, the directives issued by Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 the Company has not complied with the said norms in relation to repayment of deposits on their respective maturity dates. We are informed by the management that a scheme of compromise and arrangement has been filed with the Honble Delhi High Court, where the matter is sub-judice. As per the interim order of the Court, partial repayments have been made to certain depositors in hardship cases determined by independent committee set up by the Court. The Scheme is pending final approval of the Honble Delhi High Court. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal;

7. The internal audit system of the Company, in our opinion, needs to be strengthened;

8. In view of nature of business of the Company, the maintenance of cost records under clause (d) of sub- section (1) of Section 209 of the Companies Act, 1956 has not been prescribed by the Central Government;

9. (a) According to the records, information and explanations provided to us, the Company is generally regular in depositing with appropriate authorities undisputed amount of provident fund, investor education protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other statutory dues applicable to it and no undisputed amounts payable were outstanding as at 31st March, 2010 for a period of more than six months from the date they became payable;

(b) The following are the details of disputed Income Tax and Sales Tax that have not been paid to the concerned authorities:

S. No. Nature of Forum where Dispute is Pending Unpaid Amount (in Statutory Dues Rs. Lacs)

1 Income Tax CIT (Appeals) 295.83

2 Sales Tax AC Appeal, Kolkata 2.26

DC Appeal, Noida 0.54

10. The Company has accumulated losses at the end of the financial year and also has incurred losses during the year. The net worth of the Company continues to stand fully eroded as at the end of the financial year;

11. Based on our audit procedures and as per the information and explanations given by the management, the Company has not defaulted in repayment of dues to any financial institution or bank;

12. Based on our examination and according to the information and. explanations given 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;

13. As explained to us, the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/ Societies are not applicable to the Company;

14. The Company is not dealing or trading in shares, securities, debentures and other investments;

15. On the basis of the information and explanations given to us the Company has not given any guarantee for loans taken by others from bank or financial institutions;

16. Based on information and explanations given to us by the management, no term loan has been obtained by the company during the financial year;

17. On the basis of our examination of the books of accounts and as per information and explanations given to us, in our opinion, no fund were raised by the company on short term basis during the financial year;

18. During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act;

19. The Company did not have any outstanding debentures during the year;

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

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

For N.M. Raiji&Co.

Chartered Accountants

Sd/

S. N. Shivakumar

Place: Faridabad Partner

Date: 11th August, 2010 M.No. 88113

Firm Regn. No. 108296W