Auditor Report of Shahi Shipping Ltd.

Mar 31, 2017

TO THE MEMBERS OF SHAHI SHIPPING LIMITED.

Report on the Financial Statement

We have audited the accompanying financial statement of the Shahi Shipping Ltd., (The Company), which comprise the Balance Sheet as at 31^st March, 2017, the Statement of Profit and Loss and Cash Flow statement for the year ended and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act 2013(“The Act”) with respect to the preparation of these financial statements that gives a true and fair view of the financial position, financial performance and cash flow of the Company in accordance with the Accounting principles generally accepted in India, including the Accounting Standards referred under section 133 of the Companies Act 2013, (“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 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 internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility.

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

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

We conducted our audit in accordance with the Standard on Auditing specified under section 143(10) of the Companies Act 2013. Those standards requires 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 procedure 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 risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessment, the auditor considers internal 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 accounting policies used and the reasonableness of the accounting estimates made by Company 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanation given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view i n conformity with the accounting principles generally accepted in India, of the state of affairs of the company as at 31^st march 2017 and its Loss and its Cash Flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by The Companies (Auditors Report) Order, 2016 (the Order) issued by the Central Government of India in terms of Sub Section (11)of Section 143 of the Act, we give in the Annexure ‘A’ a statement on the matters specified in paragraphs 3 and 4 of the order.

2. As required by section 143(3) of the Company Act 2013, 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 purpose of our audit.

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

c) The Balance Sheet and Statement Profit and Loss and Cash Flow statement, dealt with by this report are in agreement with books of accounts.

d) In our opinion, the financial statements comply with the Accounting Standards specified under section 133 of the act, read with Rule 7 of the Companies (Accounts) Rules 2014.

e) On the basis of written representations received from the directors as on 31^st March 2017 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31^st March, 2017, from being appointed as a director in terms of section 164 (2)of the Companies Act, 2013.

f) With respect to the internal financial controls over financial reporting of the Company, refer to our separate report in ‘Annexure B’.

g) With respect to other matters to be included in the Auditors Report in accordance with rules 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 does not have any pending litigations which would impact its financial position.

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

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

(iv) The Company has provided requisite disclosures in the financial statements (refer to item no IV of Note 22) as regards its holding and dealings in Specified Bank Notes as defined in the Notification S.O. 3407(E) dated 8^th November, 2016 of the Ministry of Finance, during the period from 8^th November, 2016 to 30^thDecember, 2016. Based on audit procedures performed and the representations provided to us by the management we report that the disclosures are in accordance with the books of account maintained by the Company and as produced to us by the Management.

ANNEXURE ‘A’ TO THE AUDITORS’ REPORT:-

The Annexure referred to in Independent Auditors’ Report to the members of Shahi Shipping Ltd for the year ended 31^st March 2017, we report that:

1. The Company has maintaining records showing particulars including quantitative details & situation of fixed assets.

a) Some fixed assets have been physically verified by the management during the year in accordance with phased program of verification adopted by the company. No material discrepancies between the book records and physical inventory were noticed in respect of assets physically verified during the year.

b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company, except for the following:

(Rs in Lakhs)

Particulars	Office Premises*
Gross Block as at 31 March 2017	2.34
Net Block as at 31 March 2017	0.78

*Included under the heading Building in the Note no 10(a) to the Financial Statements.

2. The Company is in Shipping business, therefore Clause of the above mentioned order regarding inventory and its physical verification, etc., do not apply in its case. The Company does purchase stores and spare parts for its ships & barges which are directly treated as consumed as and when supplied to its ships & barges. Thus paragraph 2 (i),

(ii) and (iii) of the order is not applicable.

3. The Company has not given any Loans, secured or unsecured to companies, firm or other parties listed in the register maintained under section 189 of Companies Act, 2013.

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

5. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public in accordance with the provision of section 73 to 76 of the Act and Rules framed there under.

6. The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Companies Act, 2013, for any of the services rendered by the company.

7. a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, the undisputed material statutory dues in respect of provident fund, employees state insurance, sales-tax, income-tax, service tax, customs duty, excise duty, value Added Tax, cess and other material statutory dues as applicable, have been generally regularly deposited by the Company during the year with the appropriate authorities except due is respect of Income Tax. The extent of the arrears of statutory dues outstanding as at 31/03/2017 for a period of more than six months from the date became payable in respect of Income Tax pertaining to financial years 2011-2012 Rs.0.85 Lakhs.

b) According to the information and explanation given to us, there are no dues of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty or Value Added Tax outstanding on account of any dispute.

8. As per the information and explanation given by the management, the Dena Bank Term loan includes outstanding & unpaid interest of sum of Rs. 63.03 Lakhs funded by the Bank during the year and merged with the Principal loan amount sum of Rs 88.04 Lakhs. The company has not been provided with any revised arrangement from the Bank. In absence of any such arrangement, the company has been repaying the installment based on the terms and condition as mentioned in the original loan sanction letter dated: 14/09/2012 as issued by Dena Bank. There are no Debenture Holders.

9. 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, paragraph 3(ix) of the Order is not applicable.

10. 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.

11. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid / provided for managerial remuneration for the current year in accordance with the provisions of Section 197 read with Schedule V to the Act.

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

13. 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.

14. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

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

16. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act 1934.

ANNEXURE ‘B’ TO THE AUDITOR REPORT:-

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

We have audited the internal financial controls over financial reporting of Shahi Shipping Ltd., (The Company) as of 31 March 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

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

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the ‘Guidance Note’) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India.

Because of the matter described in Disclaimer of Opinion paragraph below, we are not able 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.

Meaning of Internal Financial Controls over Financial Reporting

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

Disclaimer of Opinion

According to the information and explanation given to us, the Company has not established its internal financial control 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 audit 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, 2017.

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

Our Opinion is modified in respect of this matter.

For N. D. HEDA & CO.

Firm Registration No. 103604W

Chartered Accountants

(N. D. HEDA)

Proprietor M. N. 32450

Place: Mumbai

Date : 30/05/2017

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Mar 31, 2015

We have audited the accompanying financial statement of the Shahi Shipping Ltd., (The Company),(Formally known as SKS Logistics Ltd) which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss and Cash Flow statement for the year ended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act 2013("The Act") with respect to the preparation of these financial statements that gives a true and fair view of the financial position, financial performance and cash flow of the Company in accordance with the Accounting principles generally accepted in India, including the Accounting Standards referred under section 133 of the Companies Act 2013, ("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 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 internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility.

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

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

We conducted our audit in accordance with the Standard on Auditing specified under section 143(10) of the Companies Act 2013. Those standard requires 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 procedure 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 risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessment, the auditor considers internal control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has place an adequate internal financial controls system over financial reporting and operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanation given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the company as at 31st march 2015 and its Loss and its Cash Flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

(1) As required by The Companies (Auditors Report) Order, 2015 (the Order) issued by the Central Government of India in terms of Sub Section (11) of Section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the order.

(2) As required by section 143(3) of the Company Act 2013, 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 purpose of our audit.

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

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

(d) In our opinion, the financial statements comply with the Accounting Standards specified under section 133 of the act, read with Rule 7 of the Companies (Accounts) Rules 2014.

(e) On the basis of written representations received from the directors as on 31st March 2015 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2015, from being appointed as a director in terms of section 164 (2) of the Companies Act, 2013.

(f) With respect to other matters to be included in the Auditors Report in accordance with rules 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to the best of our information and according to the explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements as refer in Note 22 (I) (b) of the financial statements.

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

(iii) There has been no delay in transferring amounts, required to be transferred to the Investor Education and Protection Fund by the Company except a sum of ' 1.99 lacs, which are required to be transfer in the above stated fund.

ANNEXURE TO THE AUDITOR REPORT

(Referred to in paragraph 3 of our Report of even date on the accounts of Shahi Shipping Ltd (Formerly Known as SKS Logistics Ltd) for the year ended 31st March, 2015).

1. a) The Company has maintained on year to year basis the records showing particulars including quantitative details of fixed assets and company is in process of updating the fixed assets register.

b) Some fixed assets have been physically verified by the management during the year in accordance with phased program of verification adopted by the company. No material discrepancies between the book records and physical inventory were noticed in respect of assets physically verified during the year.

2. The Company is in Shipping business, therefore Clause of the above mentioned order regarding inventory and its physical verification, etc., do not apply in its case. The Company does purchase stores and spare parts for its ships & barges which are directly treated as consumed as and when supplied to its ships & barges. Thus paragraph 2 (i), (ii) and (iii) of the order is not applicable.

3. The Company has not given any Loans, secured or unsecured to companies, firm or other parties listed in the register maintained under section 189 of Companies Act, 2013.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regards to purchases of stores, spare parts, fixed assets and services rendered. During the course of our audit, no major weakness has been noticed in the internal controls.

5. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public in accordance with the provision of section 73 to 76 of the Act and Rules framed there under.

6. The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Companies Act, 2013, for any of the services rendered by the company.

7. a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, the undisputed material statutory dues in respect of provident fund, employees state insurance, sales-tax, income-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues as applicable, have been generally regularly deposited by the Company during the year with the appropriate authorities except due is respect of Income Tax & Service Tax. The extent of the arrears of statutory dues outstanding as at 31/03/2015 for a period of more than six months from the date became payable in respect of Income Tax and Service Tax pertaining to financial years 2010-11 & 2011- 2012 Rs. 56.27 Lacs.

b) According to the information & explanation given to us , the Commissioner of Income Tax (Appeal) & the Income Tax Appellate Tribunal has passed the Appellate Order in favour of Company in respect of the Income Tax Demand under the Income Tax Act, 1961 sum of Rs. 73.79 Lacs for the financial year 2004-05 and sum of Rs. 166.33 Lacs for the financial year 2005-06, however the Income Tax Department has preferred appeals against above said order before the High Court which have not been deposited by the Company on account of dispute with concerned authorities.

c) According to the Information and explanations given to us the amount sum of ' 1.99 Lacs the unclaimed dividend of Financial Year 2006-07, which were required to be transferred to the investor education and protection fund, due and outstanding in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules there under.

8. The Company does not have any accumulated losses nor has it incurred any cash losses during the financial year covered by our audit and the immediately preceding financial year.

9. According to the information and explanations given by the management, the Company has overdue repayment of loan installment of Bank Term Loans aggregating to Rs. 530.32 Lacs and overdue installment of Interest on Bank Term Loans aggregating to Rs. 207.49 Lacs relating to Financial Year 2013-14 & 2014-2015. There are no Debenture Holders.

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

11. In our opinion and according to the information and explanations given to us and on an overall examination, the term loans have been applied for the purpose for which they were raised.

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

For N. D. HEDA & CO. Firm Registration No. 103604W Chartered Accountants

(N. D. HEDA) Proprietor M. N. 32450 Place : Mumbai Date : 28/05/2015

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Mar 31, 2014

We have audited the accompanying financial statement of the Shahi Shipping Ltd., (Formerly Known SKS Logistics Ltd) ,which comprise the Balance Sheet as at 31st March, 2014 , the Statement of Profit and Loss and cash flow statement for the year ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company Management is responsible for the preparation of these financial statements that gives a true and fair view of the financial position, financial performance 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) (which continue to be applicable in respect of Section 133 of the Companies Act , 2013 in terms of General Circular 15/2013 dated 13 September , 2013 of the Ministry of Corporate Affairs ) and in accordance with the Accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility.

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standard on Auditing issued by the Institute of Chartered Accountants of India. Those standard requires 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 procedure 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 risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessment , the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by managements, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

ii) In the case of the Statement Profit and Loss, of the Loss 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.

Report on Other Legal and Regulatory Requirements

(1) As required by The Companies (Auditors Report) Order, 2003 (the Order) issued by the Central Government of India in terms of Section 227 (4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the order.

(2) As required by section 227(3) of the Company Act, we report that.

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

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

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

(d) In our opinion, and to the best of our information the Balance Sheet and Statement of Profit and Loss and cash flow Statement comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act , 2013 in terms of General Circular 15/2013 dated 13 September, 2013 of the Ministry of Corporate Affairs)

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

(Referred to in paragraph 3 of our Report of even date on the accounts of Shahi Shipping Ltd. for the year ended 31st March, 2014).

1. a) The Company is maintaining the records showing particulars including quantitative details and situation of fixed assets.

b) Some fixed assets have been physically verified by the management during the year in accordance with phased program of verification adopted by the company. No material discrepancies between the book records and physical inventory were noticed in respect of assets physically verified during the year.

c) The company has not disposed off substantial part of its fixed assets during the year.

2. The Company is in Shipping business, therefore clauses (ii)(a), (ii)(b) and (ii)(c) of Para 4 of the above mentioned order regarding inventory and its physical verification, etc., do not apply in its case. The Company does purchase stores and spare parts for its ships & barges which are directly treated as consumed as and when supplied to its ships & barges.

3. a) The Company has not given any Loans, secured or unsecured to companies, firm or other parties listed in the register maintained under section 301 of Companies Act, 1956. The company has taken unsecured loan from Companies and a Director listed in the registered maintained under section 301 of the Companies Act, 1956. The maximum balance outstanding during the year is Rs. 720.24 lacs. (Previous Year Rs. 632.89 Lacs)

b) In our opinion and according to the information and explanation given to us the unsecured loans taken by the company are interest free, the same are repayable on demand and therefore question of overdue amount does not arise.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regards to purchases of stores, spare parts, fixed assets and services rendered. During the course of our audit, no major weakness has been noticed in the internal controls.

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- (Rupees Five Laces only) or more in respect of any party.

6. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under. 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. In our opinion the company has internal Audit system commensurate with the size and nature of its business.

8. As informed to us the maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, in respect of activities carried on by the company.

9. a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, the undisputed material statutory dues in respect of provident fund, investor education and protection fund, employees state insurance, sales-tax, income-tax, wealth-tax, customs duty, excise duty, cess and other material statutory dues as applicable, have been generally regularly deposited by the Company during the year with the appropriate authorities except due is respect of Income Tax & Service Tax. The extent of the arrears of statutory dues outstanding as at 31/03/2014 for a period of more than six months from the date became payable in respect of Income Tax and Service Tax pertaining to financial years, 2010-2011 & 2011-2012 Rs. 100.76 Lacs.

b) According to the information & explanation given to us the Income Tax Demand under The Income Tax Act 1961 sum of Rs. 73.79 Lacs for financial year 2004-05, sum of Rs. 166.33 Lacs for the financial year 2005-06 in respect of Appellate Order passed in favour of Company by the Commissioner of Income Tax (Appeal) and by the Income Tax Appellate Tribunal, the Income Tax Department has preferred appeals against the above said orders before in High Court and for financial year 2009-2010 sum of Rs. 686.85 Lacs disputed before the Commissioner of Income Tax (Appeals) which have not been deposited by the Company on account of dispute with concerned authorities.

10. The Company does not have any accumulated losses nor has it incurred any cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. According to the information and explanations given by the management, the Company has overdue repayment of loan instalment of Bank Term Loans aggregating to Rs. 420.15 Lacs and overdue instalment of Interest on Bank Term Loans aggregating to Rs. 180.67 Lacs relating to Financial Year 2013-2014. There are no Debenture Holders.

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares etc.

13. In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund/societies are not applicable to the Company.

14. The Company is not dealing or trading in shares, securities,etc.

15. The Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information and explanations given to us and on an overall examination, the term loans have been applied for the purpose for which they were raised.

17. Based on our examination and the information and explanation given to us, we report that the Company has not utilised any funds raised on short term basis for long term investments and vice-versa.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

19. The Company has not issued any secured debentures during the year.

20. The company has not raised any money by public issue during the year.

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



For N. D. HEDA & CO. Firm Registration No. 103604W Chartered Accountants.

N. D. HEDA Proprietor Membership No. 32450

Place : Mumbai Date : 29/05/2014

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Mar 31, 2013

Report on the Financial Statement

We have audited the accompanying financial statement of the SKS LOGISTICS LIMITED, (The Company),which comprise the Balance Sheet as at 31st March, 2013 , the Statement of Profit and Loss and cash flow statement for the year ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company Management is responsible for the preparation of these financial statements that gives a true and fair view of the financial position, financial performance 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) and in accordance with the Accounting principles generally accepted in India. This, responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standard on Auditing issued by the Institute of Chartered Accountants of India. Those standard requires 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 procedure 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 risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessment, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by managements, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31" March, 2013.

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

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

Report on Other Legal and Regulatory Requirements

(1) As required by The Companies (Auditors Report) Order, 2003 (the Order) issued by the Central Government of India in terms of Section 227 (4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the order.

(2) As required by section 227(3) of the Company Act, we report that:

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

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

(c) The Balance Sheet and Statement Profit and Loss and Cash Flow statement .dealt with by this report are in agreement with books of accounts.

(d) In our opinion, and to the best of our information the Balance Sheet and Statement of Profit and Loss dealt with this report comply with the Accounting Standards referred to in Section 211 (3C) ofihe Companies Act 1956, to the extent applicable.

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

ANNEXURE TO THE AUDITOR REPORT :-

(Referred to in paragraph (1) under the heading "Report on other Legal and Regulatory Requiremenf of our Report of even date on the accounts of SKS Logistics Limited for the year ended 31" March, 2013).

1. (a) The Company is maintaining the records showing, particulars including quantitative details and situation of fixed assets.

(b) Some fixed assets have been physically verified by the management during the year in accordance with phased program of verification adopted by the company. No material discrepancies between the book records and physical inventory were noticed in respect of assets physically verified during the year.

(c) The company has not disposed off substantial part of its fixed assets during the year.

2. The Company is in Shipping business, therefore clauses (ii)(a), (ii)(b) and (ii)(c) of Para 4 of the above mentioned order regarding inventory and its physical verification, etc., do not apply in its case. The Company does purchase stores and spare parts for its ships & barges which are directly treated as consumed as and when supplied to its ships & barges.

3. (a) The Company has not given any Loans, secured or unsecured to companies, firm or other parties listed in the register maintained under section 301 of Companies Act, 1956. The company has taken unsecured loan from Companies and a Director listed in the registered maintained under section 301 of the Companies Act, 1956. The maximum balance outstanding during the year is Rs.632.89 lacs. (Previous Year Rs. 340.45 Lacs)

(b) In our opinion and according to the information and explanation given to us the unsecured loans taken by the company are interest free, the same are repayable on demand and therefore question of overdue amount does not arise. -

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regards to purchases of stores, spare parts, fixed assets and services rendered. During the course of our audit, no major weakness has been noticed in the internal controls.

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies. Act, 1956 aggregating during the year to Rs. 5,00,000/- (Rupees Five Laces only ) or more in respect of any party.

6. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under. 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. In our opinion the company has internal Audit system commensurate with the size and nature of its business.

8. As informed to us the maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, in respect of activities carried on by the company.

9. (a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, the undisputed material statutory dues in respect of provident fund, investor education and protection fund, employees state insurance, sales-tax, income-tax, wealth-tax, customs duty, excise duty, cess and other material statutory dues as applicable, have been generally regularly deposited by the Company during the year with the appropriate authorities except due is respect, of Income Tax & Service Tax. The extent of the arrears of statutory dues outstanding as at 31/03/2013 for a period of more than six months from the date became payable in respect of Income Tax and Service Tax pertaining to financial years, 2010-2011 & 2011 -2012 Rs. 157.95 Lacs.

(b) According to the information and explanation given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty or Cess outstanding on account of any dispute.

10. The Company does not have any accumulated losses nor has it incurred any cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. According to the information and explanations given by the management, the Company has overdue repayment of loan instalment of Bank Term Loans aggregating to Rs. 3,19,48,547/- and overdue instalment of Interest on Bank Term Loans aggregating to Rs. 77,63,379/- relating to Financial Year 2012-2013. There are no Debenture Holders.

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares etc.

13. In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14. The Company is not dealing or trading in shares, securities, etc.

15. The Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. In bur opinion and according to the information and explanations given to us and on an overall examination, the term loans have been applied for the purpose for which they were raised.

17. Based on our examination and the information and explanation given to us, we report that the Company has not utilised any funds raised on short term basis for long term investments and vice-versa.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

19. The Company has not issued any secured debentures during the year.

20. The company has not raised any money by public issue during the year.

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

For N. D. HEDA & CO.

Firm Registration No. 103604W

Chartered Accountants.

N.D.HEDA

Proprietor Membership No. 32450

Place : Mumbai

Date : 30/05/2013

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Mar 31, 2012

(1) We have Audited the attached Balance Sheet of SKS LOGISTICS LIMITED as at 31st March, 2012 and also the related statement of Profit and Loss of the Company for the year ended on that date annexed thereto and Cash Flow Statement of company for the year ended on that date. These financial statement 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) 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 paragraphs 4 and 5 of the said Order.

(4) Further to our comments in the annexure referred to in paragraph 3 above :

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

(b) In our opinion, proper books of accounts as required by law have been kept by the company, so far as appears from our examination of such books.

(c) The Balance Sheet and Statement of Profit and Loss and Cash Flow Statement deatt with by this report are in agreement with books of accounts.

(d) In our opinion, and to the best of our information the Balance Sheet and Statement of Profit and Loss and Cash Flow Statement dealt with this report comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act 1956, to the extent applicable.

(e) On the basis of written representations received from the directors as on 31s* March 2012 and taken on record by the Board of Directors, none of the Directors is prima-facie disqualified as on 313 March. 2012, from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

(f) In our opinion and to the best of our information and according to the explanations given to us the said accounts read with the Significant Accounting Policies and other Notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India :

I) In the case of the Balance Sheet of the state of affairs of the Company as at 31s March. 2012.

II) In the case of the Statement of Profit and Loss of the Profit for the year ended on that date.

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

ANNEXURE TO THE AUDITOR REPORT

(Referred to in paragraph 3 of our Report of even date on the accounts of SKS Logistics Limited for the year ended 31st March, 2012).

1. (a) The Company is maintaining the records showing particulars including quantitative details and situation of

fixed assets.

(b) Some fixed assets have been physically verified by the management during the year in accordance with phased program of verification adopted by the company. No material discrepancies between the book records and physical inventory were noticed in respect of assets physically verified during the year.

(c) The company has not disposed off substantial part of its fixed assets during the year.

2. The Company is in Shipping business, therefore clauses (ii)(a), (ii)(b) and (ii)(c) of Para 4 of the above mentioned order regarding inventory and its physical verification, etc., do not apply in its case. The Company does purchase stores and spare parts for its ships & barges which are directly treated as consumed as and when supplied to its ships & barges.

3. (a) The Company has not given any Loans, secured or unsecured to companies, firm or other parties listed in the register maintained under section 301 of Companies Act, 1956. The company has taken unsecured loan from Companies and a Director listed in the registered maintained under section 301 of the Companies Act, 1956. The maximum balance outstanding during the year is Rs. 340.45 lacs. (Previous Year Rs. 442.45 Lacs)

(b) In our opinion and according to the information and explanation given to us the unsecured loans taken by the company are interest free, the same are repayable on demand and therefore question of overdue amount does not arise.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regards to purchases of stores, spare parts, fixed assets and services rendered. During the course of our audit, no major weakness has been noticed in the internal controls.

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- (Rupees Five Laces only ) or more in respect of any party.

6. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under. 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. In our opinion the company has internal Audit system commensurate with the size and nature of its business.

8. As informed to us the maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, in respect of activities carried on by the company.

9. (a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, tne undisputed material statutory dues in respect of provident fund, investor education and protection fund, employees state insurance, sales-tax, income-tax, wealth-tax, customs duty, excise duty, cess and other material statutory dues as applicable, have been generally regularly deposited by the Company during the year with the appropriate authorities except due is respect of Income Tax & Service Tax. The extent of the arrears of statutory dues outstanding as at 31/03/2012 for a period of more than six months from the date became payable in respect of Income Tax and Service Tax pertaining to financial years, 2010-2011 & 2011-2012Rs. 178.23 Lacs.

(b) According to the information and explanation given io us, there are no dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty or Cess Outstanding on account of any dispute.

10. The Company does not have any accumulated losses nor has it incurred any cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. According to the information and explanations given by the management, the Company has overdue repayment of loan installments of Bank Term Loans aggregating to Rs. 3,13,69,537/- and overdue installments of Interest on Bank Term Loans aggregating to Rs. 44,39,239/- relating to Financial Year 2011-2012. There are no Debenture Holders.

12. The Company has not granted any loans and advances on the basis of security by way of pledge cf shares etc.

13. In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14. The Company is not dealing or trading in shares, securities, etc.

15. The Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information :> o explanations given to us and on an overall examination, the term loans have been applied for the purpose for which they were raised.

17. Based on our examination and the information and explanation given to us, we report that the Company has not utilised any funds raised on short term basis for long term investments and vice-versa.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

19. The Company has not issued any secured debentures during the year.

20. The company has not raised any money by public issue during the year.

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

For N. D, HEDA & CO.

Firm Registration No. 1036Q4W Chartered Accountants.

N. D. HEDA

Proprietor Membership No. 32450

Place : Mumbai

Date : 14th August 2012

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Mar 31, 2010

(1) We have Audited the attached Balance Sheet of SKS LOGISTICS LIMITED as at 31st March, 2010 and also the annexed Profit and Loss Account of the Company for the year ended on that date annexed thereto and Cash Flow Statement of company for the year ended on that date. These financial statement are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

(2) We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by 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) 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 paragraphs 4 and 5 of the said Order.

(4) Further to our comments in the annexure referred to in paragraph 3 above :

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

(b) In our opinion, proper books of accounts as required by law have been kept by the company, so far as appears from our examination of such books.

(c) The Balance Sheet and Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with books of accounts.

(d) In our opinion, and to the best of our information the Balance Sheet and Profit and Loss Account and Cash Flow Statement dealt with this report comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act 1956, to the extent applicable.

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

(f) Disclosure of Deferred Tax Liability is made under the head "Reserve and Surplus" for the reasons stated in note 26 of schedule 19.

(g) In our opinion and to the best of our information and according to the explanations given to us the said accounts read with the Significant Accounting Policies and other Notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India :

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

II) In the case of the Profit and Loss Account of the Loss for the year ended on that date.

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

ANNEXURE TO THE AUDITOR REPORT: (Referred to in paragraph 3 of our Report of even date on the accounts of SKS Logistics Limited for the year ended 31st March, 2010).

1. (a) The Company has maintained on year to year basis the records showing particulars including quantitative details of fixed assets and company is in process of updating the fixed assets register.

(b) Some fixed assets have been physically verified by the management during the year in accordance with phased program of verification adopted by the company. No material discrepancies between the book records and physical inventory were noticed in respect of assets physically verified during the year.

(c) The company has not disposed off substantial part of its fixed assets during the year.

2. The Company is in Shipping business, therefore clauses (ii)(a), (ii)(b) and (ii)(c) of Para 4 of the above mentioned order regarding inventory and its physical verification, etc., do not apply in its case. The Company does purchase stores and spare parts for its ships & barges which are directly treated as consumed as and when supplied to its ships & barges.

3. (a) The Company has not given any Loans, secured or unsecured to companies, firm or other parties listed in the register maintained under section 301 of Companies Act, 1956. The company has taken unsecured loan from Companies and a Director listed in the registered maintained under section 301 of the Companies Act, 1956. The maximum balance outstanding during the year is Rs.466.45 lacs. (Previous Year Rs 219 Lacs)

(b) In our opinion and according to the information and explanation given to us the unsecured loans taken by the company are interest free, the same are repayable on demand and therefore question of overdue amount does not arise.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business With regards to purchases of stores, spare parts, fixed assets and services rendered. During the course of our audit, no major weakness has been noticed in the internal controls.

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- (Rupees Five Laces only ) or more in respect of any party.

6. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

7. In our opinion the company has internal Audit system commensurate with the size and nature of its business.

8. As informed to us the maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, in respect of activities carried on by the company.

9. (a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, the undisputed statutory dues in respect of provident fund, investor education and protection fund, employees state insurance, sales-tax, wealth-tax, customs duty, excise duty, cess and other material statutory dues as applicable, have been generally regularly deposited by the Company during the year with the appropriate authorities except due is respect of Income Tax, Fringe Benefit Tax & Service Tax. The extent of the arrears of statutory dues outstanding as at 31/03/2010 for a period of more than six months from the date became payable in respect of Income Tax, Fringe Benefit Tax & Service Tax pertaining to financial years, 2007-08 & 2008-09 & 2009-10 Rs 127.52 Lacs .

(b) According to the information and explanation given to us, there are no dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty or Cess Outstanding on account of any dispute.

10. The Company does not have any accumulated losses nor has it incurred any cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institution, bank or debenture holders, as at the balance sheet date.

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares etc.

13. In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company.

14. The Company is not dealing or trading in shares, securities, etc.

15. The Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information and explanations given to us and on an overall examination, the term loans have been applied for the purpose for which they were raised.

17. Based on our examination and the information and explanation given to us, we report that the Company has not utilised any funds raised on short term basis for long term investments and vice-versa.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

19. The Company has not issued any secured debentures during the year.

20. The company has not raised any money by public issue during the year.

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

For N. D. HEDA & CO

Chartered Accountants

Firm Registration No. 103604W

N. D. HEDA

Place : Mumbai Proprietor

Date : 13th August 2010 Membership No. 32450