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Auditor Report of Sona Koyo Steering Systems Ltd.

Mar 31, 2017

To the Members of

SONA KOYO STEERING SYSTEMS LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of SONA KOYO STEERING SYSTEMS LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2017, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the 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 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 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 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 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.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2017, its profit, and its cash flows for the year ended on that date.

Report on other legal and regulatory requirements

1) As required by the Companies (Auditor''s Report) Order, 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 Act, we report that:

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

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

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

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 31 to the standalone financial statements;

ii. The Company has made provisions, as required under the applicable law or accounting standards, for material foreseeable losses if any, as required on long-term contracts including derivative contracts - Refer Note 46 to the standalone financial statements;

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 its financial statements as to holdings as well as dealings in specified bank notes during the period from 8th November, 2016 to 30th December, 2016. Based on audit procedures and relying on the management representation, we report that the disclosures are in accordance with the books of accounts maintained by the Company and as produced to us by the management- Refer Note 44 to the standalone financial statements.

The Annexure referred to in our Independent Auditor''s Report to the members of the Company on the standalone financial statements for the year ended 31st March, 2017.

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

(b) Fixed assets verification has been conducted by the management during the year. All the fixed assets of the Company have not been physically verified by the management during the year but there is a regular phased programme of physical verification of all fixed assets over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties, included in fixed assets are held in the name of the Company except for the case below:

No. of

Asset

Gross Block

Net Block

Remarks

Cases

Category

as at 31st March, 2017 (Rs, In lakhs)

as at 31st March, 2017 (Rs, In lakhs)

1.

Freehold

72.83

72.83

The deed of

Land

conveyance is in the erstwhile name of the subsidiary company which had amalgamated with the Company and the mutation of name is pending

ii. Physical verification of inventory, except goods-in-transit has been conducted by the management at reasonable intervals during the year. The discrepancies noticed on verification between the physical stocks and book records, which in our opinion were not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Accordingly, the paragraphs 3(iii), 3(iii)(a), 3 (iii)(b) and 3 (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 given any loans, made investments, given guarantees or security during the year which is covered under provisions of Section 185 and 186 of the Companies Act, 2013. Accordingly, the paragraph 3(iv) of the Order is not applicable to the Company.

v. According to the information and explanations provided by the management, we are of the opinion that the Company has not accepted any deposits from public covered under Section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and rules framed there under. Accordingly, the paragraph 3(v) of the Order is not applicable to the Company.

vi. The Companies (Cost Records and Audit) Rules, 2014 prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 is not applicable to the goods manufactured by the Company.

vii. a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues applicable to it to the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income tax, sales tax, duty of custom, duty of excise, value added tax and cess and other material statutory dues were outstanding, as on 31st March, 2017 for a period of more than six months from the date they became payable except for the following undisputed dues of service tax :

Name of the Statute

Nature of the Dues

Amount (Rs, in Lakhs)*

Period to

which the

amount

relates

Due

Date

Date of Payment

The Finance Wrong Act, 1994 a ailment of

(Service Tax) Cenvat Credit

on Exempted Sales

11.37

2015-16

31st

March,

2016

19.04.2017

* Includes interest

b) According to the information and explanations given to us, and on the basis of our examination of the books of account, there are no dues of sales tax, duty of custom and value added tax which have not been deposited on account of any dispute. According to the information and explanations given to us, the following dues of income-tax, service tax and duty of excise have not been deposited by the Company on account of disputes:

* Includes interest and penalty wherever indicated in the order

Name of the Statute

Nature of dues

Amount (Rs, in Lakhs) *

Period to which amount relates

Forum where dispute is pending

The Finance Act,1994 (Service Tax)

Wrong availment of Cenvat Credit & Penalty

7.09

2009-10

Commissioner of Appeals (Service Tax)

Central Excise Act, 1944

Wrong availment of Cenvat Credit & Penalty

4.80

2007-08 & 2008-09

Commissioner of Appeals (Central Excise)

The Finance Act,1994 (Service Tax)

Wrong availment of Cenvat Credit & Penalty (Net of deposit of Rs, 0.06 lakhs)

1.62

2014-15 to 2015-16

Commissioner of Appeals (Service Tax)

Central Excise Act,1944

Excise duty & Penalty (Net of deposit of '' 2.36 lakhs)

105.00

2008-09

CESTAT, Chennai (Central Excise)

Central Excise Act,1944

Wrong availment of Cenvat Credit & Penalty (Net of deposit of Rs, 8.36 lakhs)

321.78

2007-08 to 2011-12

CESTAT, New Delhi (Central Excise)

viii. Based on our audit procedures and on the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to any banks. The Company did not have any outstanding debentures, or loans or borrowings from any financial institutions or Government during the year.

ix. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year. Based on our audit procedures and according to information and explanations given by the management, the term loans were applied for the purpose for which they were obtained.

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 year.

xi. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.

xii. 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.

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 Companies Act, 2013 where applicable and details of such transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards.

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

xv. 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 as referred to in Section 192 of the Companies Act, 2013. Accordingly, provisions of paragraph 3(xv) of the Order are not applicable to the Company.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act 1934. Accordingly, provisions of paragraph 3(xvi) of the Order are not applicable to the Company.

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 SONA KOYO STEERING SYSTEMS LIMITED ("the Company") as of 31st March, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial 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.

Auditor''s 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 Institute of Chartered Accountants of India and deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

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

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

Meaning of Internal Financial Controls Over Financial Reporting

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

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For S. P. PURI & CO.,

Chartered Accountants

Firm Registration No. 001152N

(Rajiv Puri)

Place: Gurugram Partner

Dated: May 24, 2017 Membership No. 084318


Mar 31, 2016

We have audited the accompanying standalone financial statements of
SONA KOYO STEERING SYSTEMS LIMITED ("the Company") which comprise the
Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss,
the Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.

Management''s responsibility for the Standalone financial statements

The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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.

Auditors'' responsibility

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

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

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

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

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

Opinion

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

Report on other legal and regulatory requirements

1) As required by the Companies (Auditor''s Report) Order, 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 Act, we report that:

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

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

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

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

(e) On the basis of the written representations received from the
directors 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;

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

(g) With respect to the other matters to be included in the 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
31 to the standalone financial statements;

ii. The Company has made provisions, as required under the applicable
law or accounting standards, for material foreseeable losses if any, as
required on long-term contracts including derivative contracts - Refer
Note 46 to the standalone financial statements;

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

Annexure - ''A'' to the Independent Auditors'' Report

The Annexure referred to in our Independent Auditor''s Report to the
members of the Company on the standalone financial statements for the
year ended 31st March, 2016.

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

(b) Fixed assets verification has been conducted by the management
during the year. All the fixed assets of the Company have not been
physically verified by the management during the year but there is a
regular phased programme of physical verification of all fixed assets
over a period of three years which, in our opinion, is reasonable
having regard to the size of the Company and nature of its fixed
assets. No material discrepancies were noticed on such verification.

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

ii. Physical verification of inventory, except goods-in-transit has
been conducted by the management at reasonable intervals by the
management during the year. The discrepancies noticed on verification
between the physical stocks and book records, which in our opinion were
not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on
the basis of our examination of the books of account, the Company has
not granted any loans, secured or unsecured, to companies, firms,
Limited Liability Partnerships or other parties covered in the register
maintained under Section 189 of the Act. Accordingly, the paragraphs 3
(iii)(a), 3 (iii)(b) and 3 (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 given any loans, made investments,
given guarantees or security during the year which is covered under
provisions of Section 185 and 186 of the Act. Accordingly, the
paragraph 3(iv) of the Order is not applicable to the Company.

v. According to the information and explanations provided by the
management, we are of the opinion that the Company has not accepted any
deposits from public covered under Section 73 to 76 or any other
relevant provisions of the Companies Act and rules framed thereunder.
Accordingly, the paragraph 3(v) of the Order is not applicable to the
Company.

vi. The Companies (Cost Records and Audit) Rules, 2014 prescribed by
the Central Government under sub-section (1) of Section 148 of the
Companies Act, 2013 is not applicable to the goods manufactured by the
Company.

vii. (a) According to the information and explanations given to us and
on the basis of our examination of the books of account, the Company
has been generally regular in depositing undisputed statutory dues
including provident fund, employees'' state insurance, income-tax,
sales-tax, service tax, duty of custom, duty of excise, value added
tax, cess and other material statutory dues with the appropriate
authorities.

According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, employees''
state insurance, income tax, sales tax, service tax, duty of custom,
duty of excise, value added tax and cess and other material statutory
dues were

outstanding, as on 31st March, 2016 for a period of more than six
months from the date they became payable.

(b) According to the information and explanations given to us, and on
the basis of our examination of the books of account, there are no dues
of sales tax, duty of custom and value added tax which have not been
deposited on account of any dispute. According to the information and
explanations given to us, the following dues of income-tax, service tax
and duty of excise have not been deposited by the Company on account of
disputes:


Name of the Nature of dues Amount Period Forum where
Statute (Rs. in
Lakhs)* to which dispute is
amount pending
relates

The Finance Wrong 6.75 2009-10 Commissioner
Act,1994 availment of Appeals
(Service of
Tax) Cenvat
Credit (ServiceTax)
& Penalty


The Finance Wrong 23.96 2009-10 to Commissioner
Act,1994 availment 2015-16 of Appeals
of
(Service
Tax) Cenvat
Credit (ServiceTax)
& Penalty
(Net of
deposit
of Rs.0.90
lakhs)

The Finance Wrong 4.56 2012-13 to Commissioner
Act,1994 availment 2015-16 of Appeals
of
(Service
Tax) Cenvat
Credit (ServiceTax)

& Penalty
(Net
of deposit
of Rs.0.14
lakhs)


Central
Excise Wrong 4.59 2007-08 & Commissioner
Act,1944 availment 2008-09 of Appeals
Cenvat
Credit
(Central
Excise)
& Penalty


Central
Excise Excise duty 100.28 2008-09 Cestat,
Chennai
Act,1944 Penalty
(Net of
(Central
Excise)
deposit of
2.36 lakhs)


Central
Excise Wrong 305.06 2007-08 to Cestat,New
Act,1944 availment 2011-12 Delhi
Cenvat Credit (Central
Excise)
& Penalty
(Net of
deposit of
8.36 lakhs)

Central
Excise Wrong 100.25 2005-06 to Cestat,New
Act,1944 availment of 2010-11 Delhi
Cenvat Credit (Service
Tax)
& Penalty
(Net of
deposit of
Rs. 6.50
lakhs)

Central
Excise Wrong 18.43 2009-10 to Cestat,New
Act,1944 availment 2011-12 Delhi
Cenvat
Credit (Service
Tax)
& Penalty
(Net of
deposit of
0.61
lakhs)

Income Tax Income Tax 170.57 2011-12 Assessing
Act,1961 demand
Officer,
New Delhi

Income Tax Income Tax 0.00 2011-12 to Commissio
ner
Act,1961 demand
(Net 2013-14 of Income

of deposit
Tax
(Appeals),
7.94
lakhs) Rohtak

* Includes penalty wherever indicated in the order

viii. Based on our audit procedures and on the information and
explanations given to us, the Company has not defaulted in repayment of
loans or borrowings to financial institutions banks or to any banks.
The Company did not have any outstanding debentures, or loans or
borrowings from Government during the year.

ix. The Company did not raise any money by way of initial public offer
or further public offer (including debt instruments) during the year.
Based on our audit procedures and according to information and
explanations given by the management, the term loans were applied for
the purpose for which they were obtained.

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. 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 in accordance with the
requisite approvals mandated by the provisions of Section 197 read with
Schedule V to the Companies Act except for the remuneration
paid/provided to Company''s Executive Vice Chairman appointed during the
year which is subject to the approval by special resolution of the
shareholders.

xii. 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.

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. Accordingly,
paragraph 3(xiv) of the Order is not applicable.

xv. 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.

xvi. The Company is not required to be registered under Section 45-IA
of the Reserve Bank of India Act 1934. Accordingly, paragraph 3(xvi) of
the Order is not applicable.

For S.P. Puri & Co.,

Chartered Accountants

Firm Registration No. 001152 N

Place : Dharuhera (Rajiv Puri - Partner)

Dated : 13th May, 2016 Membership No. 084318


Mar 31, 2015

We have audited the accompanying standalone financial statements of SONA KOYO STEERING SYSTEMS LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year ended, and a summary of significant accounting policies and other explanatory information.

Management's responsibility for the Standalone financial statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation 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.

Auditors' responsibility

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

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

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

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

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

opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

Report on other legal and regulatory requirements

1) As required by the Companies (Auditor's Report) Order, 2015 ("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 annexures a statement on the matters specified in Paragraphs 3 and 4 of the Order, to the extent applicable.

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

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

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

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 31 to the standalone financial statements;

ii. The Company has made provisions, as required under the applicable law or accounting standards, for material foreseeable losses if any, as required on long-term contracts including derivative contracts - Refer Note 46 to the standalone financial statements;

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

Annexure to the Independent Auditors' Report

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

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

(b) Fixed assets verification has been conducted by the management during the year. All the fixed assets of the Company have not been physically verified by the management during the year but there is a regular phased programme of physical verification of all fixed assets over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. No material discrepancies were noticed on such verification.

ii. (a) Physical verification of inventory, except goods-in-transit has been conducted by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were found reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of examination of records of the inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records, which in our opinion were not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act. Accordingly, the paragraphs 3 (iii)(a) and 3 (iii)(b) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that some of the inventory items purchased are for the Company's specialized requirements and similarly goods sold are for the specialized requirements of the buyers and suitable alternative sources are not available to obtain comparable quotations, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for sale of goods and services. During the course of our audit, we have not observed any major weaknesses in the internal control system.

v. According to the information and explanations provided by the management, we are of the opinion that the Company has not accepted any deposits from public covered under Section 73 to 76 or any other relevant provisions of the Companies Act and rules framed there under. Accordingly, the paragraph 3(v) of the Order is not applicable to the Company.

vi. The Companies (Cost Records and Audit) Rules, 2014 prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 is not applicable to the goods manufactured by the Company.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, employees' state insurance, income- tax, sales-tax, wealth-tax, service tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees' state insurance, income tax, sales tax, wealth-tax, service tax, duty of custom, duty of excise, value added tax and cess and other material statutory dues were outstanding, as at 31st March, 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, and on the basis of our examination of the books of account, there are no dues of sales tax, wealth-tax, duty of custom, value added tax and cess which have not been deposited on account of any dispute. According to the information and explanations given to us, the following dues of income-tax, service tax and duty of excise have not been deposited by the Company on account of disputes:

Name of the Nature of dues Amount Period to which Statute (Rs. in amount relates Lakhs)*

Central Excise Wrong 4.23 2007-08 & Act, 1944 availment of 2008-09 Cenvat Credit & Penalty

Central Excise Excise duty & 83.86 2008-09 Act, 1944 Penalty

Central Excise Wrong 73.05 2007-08 to Act, 1944 availment of 2011-12 Cenvat Credit & Penalty

The Finance Wrong 32.61 2007-08 & Act, 1994 availment of 2008-09 (Service Tax) Cenvat Credit & Penalty

The Finance Wrong 6.08 2009-10 Act, 1994 availment of (Service Tax) Cenvat Credit & Penalty

The Finance Wrong 17.00 2009-10 & Act, 1994 availment of 2010-11 (Service Tax) Cenvat Credit & Penalty

The Finance Wrong 88.86 2005-06 to Act, 1994 availment of 2010-11 (Service Tax) Cenvat Credit & Penalty

The Finance Wrong 14.73 2008-09 & Act, 1994 availment of 2009-10 (Service Tax) Cenvat Credit & Penalty

Income Tax Act, Income tax 70.57 2011-12 1961 demand

Income Tax Act, Income tax 7.94 2011-12 to 1961 demand 2013-14

Name of the Statute Forum where dispute is pending

Central Excise Commissioner of Appeals Act, 1944 (Central Excise & Service Tax)

Central Excise CESTAT, Chennai Act, 1944

Central Excise CESTAT, New Delhi Act, 1944

The Finance Act, 1994 Commissioner of Appeals (Service Tax) (Central Excise & Service Tax)

The Finance Act, 1994 Commissioner of Appeals (Service Tax) (Central Excise & Service Tax)

The Finance Act, 1994 Commissioner of Appeals (Service Tax) (Central Excise & Service Tax)

The Finance Act, 1994 CESTAT, New Delhi (Service Tax)

The Finance Act, 1994 Commissioner of Appeals (Service Tax) (Central Excise & Service Tax)

Income Tax Act, 1961 Assessing Officer, New Delhi

Income Tax Act, 1961 Assessing Officer, New Delhi

* Includes penalty wherever indicated in the order

(c) According to the information and explanation given to us the amounts which were required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder has been transferred to such fund within time by the Company.

viii. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

ix. Based on our audit procedures and on the information and explanations given to us, the Company has not defaulted in repayment of dues to banks or to any financial institutions. The Company did not have any outstanding debentures during the year.

x. According to the information and explanations given to us, the Company has not given any guarantee for any loan taken by others from a bank or financial institution.

xi. Based on our audit procedures and on the information and explanations given by the management, the term loans have been applied for the purpose for which they were obtained.

xii. Based on the audit procedures performed and the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For S.P. Puri & Co., Chartered Accountants Firm Registration No. 001152 N

Place : Gurgaon (Rajiv Puri - Partner) Dated : May 15, 2015 Membership No. 084318


Mar 31, 2014

We have audited the accompanying financial statements of SONA KOYO STEERING SYSTEMS LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s responsibility for the financial statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 read with General Circular 15/2013 dated 13th September, 2013, issued by the Ministry of Corporate Affairs, in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

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

Opinion

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

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

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

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

Emphasis of matter

We draw attention to Note 45 to the financial statements relating to remuneration paid in respect of the Managerial Personnel of the Company for the financial year 2013-2014 in excess of the limits prescribed under section 198 of the Companies Act, 1956 which is subject to the approval of the Central Government. Our opinion is not qualified in respect of this matter.

Report on other legal and regulatory requirements

1. As required by the Companies (Auditor''s Report) Order, 2003, as amended by the Companies (Auditor''s Report) (Amendment) Order, 2004 (together "the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the annexure a statement on the matters specified in Paragraphs 4 and 5 of the Order.

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

i. 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;

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

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

iv. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub- section (3C) of section 211 of the Companies Act, 1956 read with General Circular 15/2013 dated 13th September, 2013, issued by the Ministry of Corporate Affairs, in respect of Section 133 of the Companies Act, 2013;

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

Annexure referred to in paragraph 1 under the heading "Report on the other legal and regulatory requirements" of our Report of even date.

Re. SONA KOYO STEERING SYSTEMS LIMITED (the Company)

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

(b) All the fixed assets of the Company have not been physically verified by the management during the year but there is a regular phased programme of physical verification which, in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) In our opinion, and according to the information and explanations given to us, fixed assets disposals during the year were not substantial and therefore do not affect the going concern assumption.

ii. (a) Physical verification of inventory, except goods-in- transit has been conducted by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were found reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of examination of records of the inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records, which in our opinion were not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has neither granted or taken any loans, secured or unsecured, to or from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the paragraphs 4 iii(b), 4 iii(c), 4 iii(d), 4 iii(f) and 4 iii(g) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that some of the inventory items purchased are for the Company''s specialized requirements and similarly goods sold are for the -specialized requirements of the buyers and suitable alternative sources are not available to obtain comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, no major weaknesses have been noticed in the internal controls.

v. Based on the audit procedures applied by us and according to the information and explanations given to us, the Company has not entered into any transactions during the financial year that needs to be entered into the Register maintained under section 301 of the Companies Act, 1956.

vi. The Company has not accepted any deposits from the public covered under section 58A, 58AA or any other relevant provisions of the Companies Act, 1956.

vii. The Company has an adequate internal audit system, which in our opinion, is commensurate with the size of the Company and the nature of its business.

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

ix. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, sales-tax, wealth-tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth-tax, service tax, customs duty, excise duty and cess were outstanding, as at 31st March, 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, and on the basis of our examination of the books of account, there are no dues of sales tax, customs duty, wealth-tax and cess which have not been deposited on account of any dispute. — According to the information and explanations given to us, the following dues of income-tax, service tax and excise duty have not been deposited^ by the Company on account of disputes:

Name of the Nature of dues Amount Period to Forum where Statute (Rs./ Lacs)* which amount dispute is relates pending

Central Excise Wrong availment 2.85 2007-2008 & Commissioner of Act, 1944 of cenvat credit 2008-2009 Appeals (Central & penalty Excise & Service Tax)

Central Excise Excise duty and 62.95 2008-2009 CESTAT, Chennai Act, 1944 penalty

The Finance Wrong availment 86.1 2007-2008 & Commissioner of Act, 1994 of Cenvat Credit 2008-2009 Appeals (Central (Service Tax) & Penalty Excise & Service Tax)

The Finance Wrong availment 4.08 2009-2010 Commissioner of Act, 1994 of Cenvat Credit Appeals (Central (Service Tax) & Penalty Excise & Service Tax)

The Finance Wrong availment 17.71 2010-2011 CESTAT, New Delhi Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 48.73 2005-2006 to CESTAT, New Delhi Act, 1994 of Cenvat Credit 2009-2010 (Service Tax) & Penalty

The Finance Wrong availment 9.87 2008-2009 & Commissioner of Act, 1994 of Cenvat Credit 2009-2010 Appeals (Central (Service Tax) & Penalty Excise & Service Tax)

Income Tax Income Tax 170.57 2011-2012 Assessing Officer Act, 1961 New Delhi

* includes penalty wherever indicated in the order

x. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. Based on our audit procedures and on the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding debentures during the year.

xii. 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.

xiii. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company.

xiv. According to information and explanations given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other investments.

xv. According to the information and explanations given to us, the Company has not given any guarantee for any loan taken by others from a bank or financial institution.

xvi. Based on our audit procedures and on the information and explanations given by the management, the term loans have been applied for the purpose for which they were raised.

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

xviii. The Company has not made any preferential allotment of shares during the year.

xix. The Company has no outstanding debentures during the year.

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

xxi. Based on the audit procedures performed and the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For S.P. Puri & Co.,

Chartered Accountants

Firm Registration No. 001152 N

Place : New Delhi (Rajiv Puri - Partner)

Dated: 30thMay, 2014 Membership No. 084318


Mar 31, 2013

Report on the financial statements

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

Management''s responsibility for the financial statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial

statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:-

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

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

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

Report on other legal and regulatory requirements

1. As required by the Companies (Auditor''s Report) Order, 2003, as amended by the Companies (Auditor''s Report) (Amendment) Order, 2004 (together "the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the annexure a statement on the matters specified in Paragraphs 4 and 5 of the Order.

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

i) 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;

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

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

iv) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement 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 confirmations received from other public Companies in which directors of the Company are directors and/or written representations received from the directors of the Company as on 31st March, 2013 and taken on record by the Board of Directors, none of the directors of the Company is disqualified as on 31st March, 2013 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

Annexure referred to in paragraph 1 under the heading "Report on other legal and regulatory requirements" of our Report of even date.

Re. SONA KOYO STEERING SYSTEMS LIMITED (the Company)

On the basis of such checks as we considered appropriate, we further report that :

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

(b) All the fixed assets of the Company have not been physically verified by the management during the year but there is a regular phased programme of physical verification which, in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) In our opinion, and according to the information and explanations given to us, fixed assets disposals during the year were not substantial and therefore do not affect the going concern assumption.

ii. (a) Physical verification of inventory, except stock-in- transit has been conducted by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were found reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of examination of records of the inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records, which in our opinion were not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has neither granted or taken any loans, secured or unsecured, to or from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the paragraphs 4 iii(b), 4 iii(c), 4 iii(d), 4 iii(f) and 4 iii(g) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that some of the inventory items purchased are for the Company''s specialized-requirements and similarly goods sold are for the specialized requirements of the-buyers and suitable alternative sources are not; --available-to obtain comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, no major weaknesses have been noticed in the internal controls.

v. Based on the audit procedures applied by us and according to the information and explanations given to us, the Company has not entered into any transactions during the financial year that needs to be entered into the Register maintained under section 301 of the Companies Act, 1956.

vi. The Company has not accepted any deposits from the public covered under section 58A, 58AA or any other relevant provisions of the Companies Act, 1956.

vii. The Company has an adequate internal audit system, which in our opinion, is commensurate with the size of the Company and the nature of its business.

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

ix. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income- tax, sales-tax, wealth-tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth-tax, service tax, customs duty, excise duty and cess were outstanding, as at 31st March, 2013 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, and on the basis of our examination of the books of account, there are no dues of income-tax, sales tax, customs duty, wealth-tax and cess which have not been deposited on account of any dispute. According to the information and explanations given to us, the following dues of service tax and excise duty=havejnot been deposited by the Company on account of disputes:

Name of the Nature of dues Amount Statute (Rs./ Lacs)*

Central Excise Wrong availment 2.85 Act, 1944 of Cenvat Credit & Penalty

The Finance Wrong availment 86.1 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 4.08 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 17.71 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 48.73 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 9.87 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

Name Period to Forum where which amount dispute is relates pending

Central Excise 2007-2008 & Commissioner of 2008-2009 Appeals (Central Excise & Service Tax)

The Finance 2007-2008 & Commissioner of 2008-2009 Appeals (Central Excise & Service Tax)

The Finance 2009-2010 Commissioner of Appeals (Central Excise & Service Tax)

The Finance 2010-2011 Commissioner of Appeals ( Central Excise & Service Tax)

The Finance 2005-2006 to Commissioner of 2009-2010 Appeals (Central Excise & Service Tax)

The Finance 2008-2009 & Commissioner of 2009-2010 Appeals (Central Excise & Service Tax)

* includes penalty wherever indicated in the order

x. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. Based on our audit procedures and on the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding debentures during the year.

xii. 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.

xiii. The Company is not a chit fund or a nidhi/ mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company.

xiv. According to information and explanations given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other investments.

xv. According to the information and explanations given to us, the Company has not given any guarantee for any loan taken by others from a bank or financial institution.

xvi. Based on our audit procedures and on the information and explanations given by the management, the term loans have been applied for the purpose for which they were raised.

xvii. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31st March, 2013, we are of the opinion that no funds raised on short term basis have been used for long term investment by the Company.

xviii. The Company has not made any preferential allotment of shares during the year.

xix. The Company has no outstanding debentures during the year.

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

xxi. Based on the audit procedures performed and the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year. For S.P. Puri & Co., Chartered Accountants

Firm Registration No. 001152 N

Place : Gurgaon (Vidur Puri - Partner)

Dated : 15th May, 2013 Membership No. 090163


Mar 31, 2012

We have audited the attached Balance Sheet of SONA KOYO STEERING SYSTEMS LIMITED ("the Company") as at 31st March 2012, the statement of profit and loss and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

1. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) Order, 2004 (together "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.

2. Further to our comments in the Annexure referred to in paragraph 1 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 purpose of our audit;

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

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

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

v. Based on confirmations received from other public Companies in which directors of the Company are directors and/or written representations made by the directors of the Company as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of the directors of the Company is disqualified as on 31st 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;

vi. 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 statement of profit and loss, of the profit for the year ended on that date; and

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

The Annexure referred to in paragraph 1 of the Auditors' Report of even date to the members of Sona Koyo Steering Systems Limited for the year ended 31st March, 2012.

On the basis of such checks as we considered appropriate, we further report that :

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

(b) All the fixed assets of the Company have not been physically verified by the management during the year but there is a regular phased programme of physical verification which, in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) In our opinion, and according to the information and explanations given to us, fixed assets disposals during the year were not substantial and therefore do not affect the going concern assumption.

ii. (a) Physical verification of inventory, except stocks lying with third parties and stock-in-transit has been conducted by the management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were found reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of examination of records of the inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records, which in our opinion were not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has neither granted or taken any loans, secured or unsecured, to or from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the paragraphs 4 iii(b), 4 iii(c), 4 iii(d), 4 iii(e), 4 iii(f) and 4 iii(g) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that some of the inventory items purchased are for the Company's specialized requirements and similarly goods sold are for the specialized requirements of the buyers and suitable alternative sources are not available to obtain comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, no major weaknesses have been noticed in the internal controls.

v. Based on the audit procedures applied by us and according to the information and explanations given to us, the Company has not entered into any transactions during the year that needs to be entered into the Register maintained under Section 301 of the Companies Act, 1956.

vi. The Company has not accepted any deposits from the public covered under Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956.

vii. The Company has an adequate internal audit system, which in our opinion, is commensurate with the size of the Company and the nature of its business.

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

ix. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess were outstanding, as at 31st March, 2012 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, and on the basis of our examination of the books of account, there are no dues of in Income Tax, Sales Tax, Customs Duty, Wealth Tax and Cess which have not been deposited on account of any dispute. According to the information and explanations given to us, the following dues of Service Tax and Excise Duty have not been deposited by the Company on account of disputes:

Name of the Nature of dues Amount Statute (Rs. / Lacs)*

Central Excise Wrong availment 2.85 Act, 1944 of cenvat credit & penalty

Central Excise Wrong availment 572.67 Act, 1944 of Cenvat Credit & Penalty

The Finance Wrong availment 86.1 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 4.08 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 17.71 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 48.73 Act, 1994 of Cenvat Credit (Service Tax) & Penalty

The Finance Wrong availment 9.87 Act, 1994 of Cenvat Credit (Service Tax) & Penalty



Name of the Period to Forum where which amount dispute is relates pending

Central Excise 2007-2008 & Commissioner of Act, 1944 2008-2009 Appeals (Central Excise & Service Tax)

Central Excise 2006-2007 to CESTAT Act, 1944 2008-2009

The Finance 2007-2008 Commissioner of Act, 1994 2008-2009 Appeals (Central (Service Tax) Excise & Service Tax)

The Finance 2009-2010 Commissioner of Act, 1994 Appeals (Central (Service Tax) Excise & Service Tax)

The Finance 2010-2011 Commissioner of Act, 1994 Appeals (Central (Service Tax) Excise & Service Tax)

The Finance 2005-2006 to Commissioner of Act, 1994 2009-2010 Appeals (Central (Service Tax) Excise & Service Tax)

The Finance 2008-2009 to Commissioner of Act, 1994 2009-2010 Appeals (Central (Service Tax) Excise & Service Tax)

* includes penalty wherever indicated in the order

x. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. Based on our audit procedures and on the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding debentures during the year.

xii. 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.

xiii. The Company is not a chit fund or a nidhi/ mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor's Report) Order, 2003 is not applicable to the Company.

xiv. According to information and explanations given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other investments.

xv. According to the information and explanations given to us, the Company has not given any guarantee for any loan taken by others from a bank or financial institution.

xvi. Based on our audit procedures and on the information and explanations given by the management, the term loans have been applied for the purpose for which they were raised.

xvii. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31st March, 2012, we are of the opinion that no funds raised on short term basis have been used for long term investment by the Company.

xviii. The Company has not made any preferential allotment of shares during the year.

xix. The Company has no outstanding debentures during the year.

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

xxi. Based on the audit procedures performed and the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.



For S.P. Puri & Co.,

Chartered Accountants

Firm Registration No. 001152 N

(Rajiv Puri - Partner)

Membership No. 084318

Place : Gurgaon

Dated: 1st May, 2012


Mar 31, 2011

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

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

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

2. Further to our comments in the Annexure referred to in paragraph 1 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 purpose 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;

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

iv. In our opinion, the Balance Sheet, Profit & 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. Based on confirmations received from other public Companies in which directors of the Company are directors and/or written representations made by the directors of the Company as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the directors of the Company is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 & Loss Account, of the PROFIT for the year ended on that date; and

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

The Annexure referred to in paragraph 1 of the Auditors Report of even date to the members of Sona Koyo Steering Systems Limited for the year ended 31st March, 2011.

On the basis of such checks as we considered appropriate, we further report that

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

(b) All the fixed assets of the Company have not been physically verified by the management during the year but there is a regular phased programme of physical verification which, in our opinion, is reasonable having regard to the size of the Company and nature of its fixed assets. No material discrepancies were noticed on such verification

(c) In our opinion, and according to the information and explanations given to us, fixed assets disposals during the year were not substantial and therefore do not affect the going concern assumption

i. (a) Physical verification of inventory, except stocks lying with vendors and stock-in-transit has been conducted by the management during the year. In respect of inventory lying with vendors at the year-end, these have been confirmed by them. In our opinion, the frequency of such verification is reasonable

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were found reasonable and adequate in relation to the size of the Company and the nature of its business

(c) On the basis of examination of records of the inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records, which in our opinion were not material, have been properly dealt with in the books of account.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has neither granted or taken any loans, secured or unsecured, to or from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the paragraphs 4 iii(b), 4 iii(c), 4 iii(d), 4 iii(f) and 4 iii(g) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that some of the inventory items purchased are for the Companys specialized requirements and similarly goods sold are for the specialized requirements of the buyers and suitable alternative sources are not available to obtain comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, no major weaknesses have been noticed in the internal controls.

v. Based on the audit procedures applied by us and according to the information and explanations given to us, the Company has not entered into any transactions during the year that needs to be entered into the Register maintained under section 301 of the Companies Act, 1956.

vi. The Company has not accepted any deposits from the public covered under section 58A, 58AA or any other relevant provisions of the Companies Act, 1956

vii. The Company has an adequate internal audit system, which in our opinion, is commensurate with the size of the Company and the nature of its business.

viii. We have broadly reviewed the books of account maintained by the Company in respect of manufacture of Companys automotive products pursuant to the order made by the Central Government for the maintenance of cost records under section 209(l)(d) of the Companies Act, 1956 and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete

ix. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess were outstanding, as at 31st March, 2011 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, and on the basis of our examination of the books of account, there are no dues of Sales Tax, Customs Duty, Wealth Tax and Cess which have not been deposited on account of any dispute. According to the information and explanations given to us, the following dues of Income Tax, Service Tax and Excise Duty have not been deposited by the Company on account of disputes:

Name of the Nature of dues Amount Statute (Rs. / Lacs)*

Income Tax Various 5.32 Act, 1961 Disallowances

Central Excise Wrong availment 6.94 Act, 1994 of Cenvat Credit & Penalty

Service Tax Wrong availment 86.1 of Cenvat Credit & Penalty

Name of the Period to Forum where status which amount dispute is relates pending

Income Tax 2007-2008 Commissioner of Act,1961 Income Tax (Appeals)

Central Excise 2007-2008 & Commissioner of Act,1994 2009-2010 Appeals (Central Excise & Service Tax)

Service Tax 2007-2008 & Commissioner of 2008-2009 Appeals (Central Excise & Service Tax)

* includes penalty wherever indicated in the orders

x. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year

xi. Based on our audit procedures and on the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding debentures during the year

xii. 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

xiii. The Company is not a chit fund or a nidhi/ mutual benefit fund/society Therefore, the provision of this clause of the Companies (Auditors Report) Order, 2003 is not applicable to the Company

xiv. According to information and explanations given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other investments

xv. According to the information and explanations given to us, the Company has not given any guarantee for any loan taken by others from a bank or financial institution

xvi. Based on our audit procedures and on the information and explanations given by the management, the term loans have been applied for the purpose for which they were raised

xvii. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31st March, 2011, we are of the opinion that no funds raised on short term basis have been used for long term investment by the Company

xviii. The Company has not made any preferential allotment of shares during the year.

xix. The Company has no outstanding debentures during the year.

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

xxi. Based on the audit procedures performed and the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For S.P. Puri & Co., Chartered Accountants FRN 001152 N

(Rajiv Puri - Partner) Membership No. 84318

Place : New Delhi Dated : 28th April, 2011

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