ఆడిటర్ నివేదిక Automobile Products of India Ltd.

Mar 31, 2024

We have audited the Ind AS financial statements of Automobile Products of India Limited ("the Company"),
which comprise the balance sheet as at March 31, 2024, and the statement of Profit and Loss (including other
comprehensive income), statement of changes in equity and statement of cash flows for the year ended 31^st March
2024, and notes to the financial statements, including a summary of material accounting policies and other
explanatory information. (herein referred to as "financial statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid
financial statements give the information required by the Companies Act, 2013, ("the Act") in the manner so
required and give a true and fair view in conformity Indian Accounting Standards prescribed under section 133 of
the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other
accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March 2024, and
Loss, (Financial performance including other comprehensive income), its cash flow and changes in equity for the
year ended 31^st March 2024..

Basis for Opinion

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

Material Uncertainty Related to Going Concern

Attention is invited to Note No. 31 in the financial statements which indicate that the Company has incurred losses
during the previous years, the Company has accumulated losses, and its net worth has been fully eroded. These
conditions indicate the existence of a material uncertainty that may cast significant doubt about the Company''s
ability to continue as a going concern. However, the financial statements of the Company have been prepared on
a going concern basis for the reasons stated in the said note as the Holding Company has assured to arrange the
required financial support. Our opinion is not modified in respect of these matters.

Other Matter

The Financial Statements of the Company for the year ended March 31, 2023, have been audited by the
predecessor Auditors, S G C O & Co. LLP, Chartered Accountants who had expressed an unmodified opinion
on those Financial statements. vide their audit report dated May 29, 2023. The figures for the year ended March
31, 2023, are based on those financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of
the Ind AS financial statements of the current period. These matters were addressed in the context of our audit of
the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters. During the course of our audit, we have determined that there are no key audit matters to
communicate in our report except for the matter described in the Material Uncertainty Related to Going Concern
section.

Information Other than the Financial Statements and Auditor’s Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the
information included in the management discussion and analysis Board''s Report, Report on Corporate governance
and Business Responsibility report but does not included in the financial statements and our auditor''s report
thereon.

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

In connection with our audit of the financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our
knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on
the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Ind AS Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act,
2013 with respect to the preparation of these Ind AS financial statements that give a true and fair view of the
financial position, financial performance, (changes in equity) 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. This responsibility also includes maintenance of adequate accounting records in accordance with
the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate accounting policies; making judgments and
estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal
financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair
view and are free from material misstatement, whether due to fraud or error.

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

Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

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

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

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

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

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

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

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

• Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate,
makes it probable that the economic decisions of a reasonably knowledgeable user of the financial
statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning
the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any
identified misstatements in the financial statements.

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

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2020 (‘the Order''), issued by the Central Government
of India in exercise of powers conferred by sub-section 11 of section 143 of the Act, we enclose in "Annexure A”,
a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by sub-section 3 of Section 143 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 except for the matter stated in paragraph g (v) below.

c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the
Statement of Cash Flows and the Statement of Changes in Equity dealt with by this Report are in agreement
with the books of account.

d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards
specified under Section 133 of the Act, read with relevant rules issued thereunder.

e) The matter described under the Material Uncertainty Related to Going Concern paragraph above, in our
opinion, may not have an adverse effect on the functioning of the Company.

f) On the basis of the written representations received from the Directors as on 31^st March 2024 and taken on
record by the Board of Directors, none of the Directors are disqualified as on 31^st March 2024, from being
appointed as a Director, in terms of sub-section (2) of Section 164 of the Act;

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

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

i. The Company has disclosed pending litigations which would impact its financial position- Refer Note
23 to the Ind AS financial statements.

ii. The company did not have any long-term contracts including derivative contracts. Hence the question
of any material foreseeable losses does not arise.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection
Fund by the Company.

iv. (a) The Management has represented that, to the best of its knowledge and belief, no funds (which
are material either individually or in the aggregate) have been advanced or loaned or invested (either
from borrowed funds or share premium or any other sources or kind of funds) by the Company to or
in any other person or entity, including foreign entity ("Intermediaries”), with the understanding,
whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend
or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
Company ("Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the
Ultimate Beneficiaries;

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

(c) Based on the audit procedures that have been considered reasonable and appropriate in the
circumstances, nothing has come to our notice that has caused us to believe that the representations
under sub-clause (i) and (ii) of Rule 11(e) of the said Rules, as provided under (a) and (b) above,
contain any material misstatement.

v. Since The Company has not declared / paid any dividend during the year, Section 123 of the Act is
not applicable.

vi. Based on our examination, which include test checks, the company has used accounting software for
maintaining its books of accounts for the financial year ended March 31, 2024, which does not the
feature of recording audit trail (edit log) facility and the same has not operated throughout the year for
all relevant transaction recorded in software.

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

3. In our opinion and according to the information and explanations given to us, the Company has not paid/provided
for any managerial remuneration, accordingly the provisions of Section 197 read with Schedule V to the Act are
not applicable to the Company

For C A S & Co

Chartered Accountants
Firm Reg. No 111075W

Sajjan Kanodia

Partner

Membership No. 048047 Place: Mumbai

UDIN: 24048047BKDHIN3800 Date: 29^th May 2024

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Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of 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.

Auditor''s Responsibility

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

An audit involves performing procedure to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud and 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 Company''s internal control. An audit also includes evaluating and 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 and Loss, of the profit for the year ended on that date; and

(c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements

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

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

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

(b) In our opinion, proper books of accounts 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, Statement of Profit & Loss, and Cash Flow Statement dealt with by this report are in agreement with the books of account;

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

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

Annexure to Auditors Report

Annexure referred to in Paragraph 1 of Report on Other Legal and Regulatory Requirements of the Auditors Report to the members of Automobile Products of India Limited for the year ended 31st March 2014.

As required by the Companies (Auditors Report) Order, 2003 and amendments thereto and according to the information and explanations given to us during the course of the audit and on the basis of such checks of the books and records as were considered appropriate we report that:

(I) a) The company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

b) As explained to us, all the fixed assets have been physically verified by the management at the year end, which in our opinion is reasonable, considering the size and the nature of business. The frequency of verification is reasonable and no material discrepancies have been noticed on such physical verification.

c) During the year, the Company has not disposed off any fixed assets.

(ii) Since the Company does not have any inventory at the year end, clause 4 (ii) of the said Order is not applicable to the Company.

(iii) a) During the year the Company has not granted any secured or unse, uou loan to any party covered in the registered maintained under section 301 of the Companies Act, 1956.

b) In view of our comments in para (a) above, clauses 4 (iii) (b), (c) and (d) of the said Order are not applicable to the Company.

c) The Company has taken unsecured loans from 2 parties covered in the register maintained under section 301 of the Act. The maximum amount outstanding during the year was Rs. 5,80,30,783 and the year end balance was Rs. 5,71,19,138.

d) The rate of interest and other terms and conditions on which the loans have been taken are prima facie, not prejudicial to the interest of the Company.

e) In view of our comments in para (c) & (d) above, clause 4 (iii) (g) of the said Order is not applicable to the Company.

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

(v) (a) Based on the audit procedures performed by us, we are of the opinion that particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained in that section.

(b) The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits from the public.

(vii) The Company does not have a formal internal audit system. However, the existing Internal Control measures are commensurate with its size and nature of business..

(viii) As per explanation & information given to us, the Central Government has not prescribed for maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956 for the Company.

(ix) a) According to the records of the Company, the undisputed statutory dues including Provident Fund, Income tax, Sales tax, Wealth tax, Service tax, Customs Duty, Excise Duty, and Cess, to the extent applicable to the Company, have been regularly deposited with the appropriate authorities. According to the information and explanations given to us, there are no undisputed amount payable in respect of such statutory dues which have remained outstanding as at 31st March, 2014 for a period more than six months from the date they became payable.

b) According to the information and explanations given to us, disputed dues of Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess which have not been deposited on account of disputes with the related authorities are as under.

Nature of Liability Amount Period to which Forum at which (Rs.) matter pertains dispute is pending

Income Tax 16,58,948 A.Y. 2003-04 ITAT 12,14,46,007 A.Y. 2008-09 ITAT

(x) The Company has accumulated losses at the end of the financial year exceeding 50% of its net worth. The Company has not incurred cash losses in the current financial year. However it had incurred cash losses in the immediately preceding financial year.

(xi) The Company has not obtained any facilities from banks and financial institutions.

(xii) The company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures or other securities.

(xiii) The provisions of any Special Statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund/ Societies are not applicable to the Company.

(xiv) According to the information and explanation given to us the Company is not dealing or trading in shares, securities, debentures or other investments.

(xv) The Company has not given any guarantee for loans taken by others from banks and financial institutions.

(xvi) The Company has not obtained any term loan during the year.

(xvii) On an overall examination of the balance sheet of the Company, we report that the Company has used funds to the extent of Rs. 8,45,80,835 raised on short term basis for long term purposes and financing of operating losses.

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

(xix) The Company has not issued any debentures during the year.

(xx) The Company has not raised any money by way of public issue during the year.

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



For SGCO&Co. Chartered Accountants Firm Reg. No. 112081W

Suresh Murarka Partner Mem. No. : 44739

Place : Mumbai Date : 24th May, 2014

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Mar 31, 2012

We have audited the attached Balance sheet of AUTOMOBILE PRODUCTS OF INDIA LTD as at 31st March, 2012, the Profit and Loss Statement and the Cash Flow Statement for the year ended on that date, both 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 misstatements. An audit includes, examining on a test basis, evidence supporting the amounts and disclosure in the financial statements. An audit also includes assessing the accounting principles used and significant estimates .

made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

2. Further to our comments in the Annexure referred in paragraph 1 above, we state that:

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

b) In our opinion, the Company has kept proper books of account, as required by law, so far as appears from our examination of such books.

c) The Balance Sheet, Profit and Loss Statement and the Cash Flow Statement referred to in this report are in agreement with the books of account.

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

e) On the basis of written representation received from Directors, and taken on record by the Board of Directors, we report that none of the Directors are disqualified as on 31st March, 2012 from being appointed as a Director in terms of Section 274 (1) (g) of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet, the Profit and Loss Statement and the Cash Flow Statement, read together with other notes and accounting policies, give the information required by the Companies Act, 1956, in the manner so required and gives a true and fair view in conformity with the accounting principles accepted in India:

(i) In so far as it relates to the Balance Sheet, of the state of affairs of the Company as at 31st March, 2012

(ii) In so far as it relates to the Profit and Loss Statement of the LOSS of the Company for the year ended on that date, and

(iii) In so far as it relates to the Cash Flow Statement, of the Cash Flow of the Company for the year ended on that date.

ANNEXURE TO THE AUDTORS' REPORT (Referred to in paragraph 1 of our report of even date)

In terms of the information and explanation given to us and the books and records examined by us in the normal

course of audit and to the best of our knowledge and belief, we state as under:



1. a) The Company has maintained proper records showing full particulars including quantitative details and

situation of Fixed Assets.

b) There were no Fixed Assets, except land, belonging to the Company.

c) No substantial part of fixed assets have been disposed off during the year.

2. a) The stock of finished goods stores and spare parts have been physically verified at reasonable intervals by

the management.

b) The procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

c) The Company is maintaining proper records of inventory and no material discrepancies are noticed on such physical verification.

3. The Company has taken loans from companies covered in the register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of stores, spare parts, components and other assets and with regard to the sale of goods. No instances of continuing failure to correct major weaknesses in Internal Control were noticed.

5. According to the information and explanation given to us, there were no transactions of purchase of goods and materials with companies covered under Section 301 of the Companies Act, 1956.

6. The Company has not accepted any deposit from the public. The provisions of sections 58A & 58AA of the Companies Act, 1956, and the Rules framed there under are not applicable.

7. In our opinion, the Company has no separate internal audit system. However, there are adequate internal control procedures commensurate with its size and nature of its business.

8. The Central Government has not prescribed for the Company the maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956.

9. According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Tax Deducted at Source with the appropriate authorities. According to the information and explanation given to us, there were no undisputed amount payable in respect of tax deducted at source and outstanding as at 31st March, 2012, for a period of more than six months from the date they became payable. The Income Tax demand for Assessment Years 2003-04 and 2008-09, disputed and under appeal are as follows:

A.Y. 2003-04 Rs 29,64,061

A.Y. 2008-09 Rs 9,71,20,638

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

11. The Company has not defaulted in repayment of dues to Financial Institutions or Banks or Debenture Holders, during the year.

12. The Company has not granted any loans and advances during the year, on the basis of security by way of pledge of shares .debentures and other securities.

13. The Company has not given guarantee for loans taken by others from Banks or Financial Institutions.

14. The Company has not obtained term loans during the year.

15. As per the records of the Company, no funds were raised on short term basis and used for long term investment and vice versa.

16. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

17. The Company has not issued any debentures and hence creation of securities in respect of debentures does not arise.

18. The Company has not raised money by way of public issues.

19. According to the information and explanation furnished to us, no fraud on or by the Company has been noticed or reported during the year.

For VENKATESH & CO., CHARTERED ACCOUNTANTS

PLACE : Chennai V. DASARATY

DATE : 29th August, 2012 PARTNER

M.No.26336

Regn. No. 004636S

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Mar 31, 2011

We have audited the attached Balance sheet of AUTOMOBILE PRODUCTS OF INDIA LTD as at 31st March, 2011 and the Profit and Loss Account 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 misstatements. An audit includes, examining on a test basis, evidence supporting the amounts and disclosure 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 issued by the company Law Board in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

2. Further to our comments in the Annexure referred in paragraph 1 above, we state that:

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

b) In our opinion, the Company has kept proper books of account as required by law so far as appears from our examination of such books.

c) The Balance Sheet and profit and Loss Account referred to in this report are in agreement with the books of account.

d) In our opinion, the Profit and Loss Account and the Balance Sheet comply with the Accounting Standards referred to in Subsections (3C) of section 211 of the Companies Act, 1956.

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet and the Profit and Loss Account read together with the other notes and accounting policies give the information required by the Companies Act 1956, in the manner so required and gives a true and fair view in conformity with the accounting principles accepted in India:

(i) In so far as it relates to the Balance Sheet, of the state of Affairs of the Company as at 31st March, 2011 and

(ii) In so far as it relates to the Profit and Loss Account of the LOSS of the Company for the year ended on that date.

ANNEXURE TO THE AUDTORS' REPORT (Referred to in paragraph 3 of our report of even date)

In terms of the information and explanation given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state as under:

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

b) There were no Fixed Assets except land and building of the Company

c) No substantial part of fixed assets has been disposed off during the year

2. a) The stock of finished goods stores and spare parts have been physically verified at reasonable intervals by the management.

b) The procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

c) The company is maintaining proper records of inventory and no material discrepancies are noticed on such physical verification.

3. The Company has not taken loans from companies covered in the register maintained under section 301 of the Companies Act 1956

4. In our opinion and according to the information and explanations given to us there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of stores, spare parts components plant and machinery, equipment and other assets and with regard to the sale of goods. No instances of continuing failure to correct major weaknesses in Internal Control were noticed.

5. According to the information and explanations given to us, the transactions of purchase of goods and materials made in pursuance of contracts or arrangements have been duly entered in the register maintained under section 301 of the Companies Act 1956.There were no transactions made in pursuance of such contracts and aggregating to Rs. 5 Lacs or more during the year in respect of each party.

6. The company has not accepted any deposits from the public. The provisions of sections 58A & 58AA of the companies Act, 1956, and the Rules framed there under are not applicable.

7. In our opinion, the company has no separate internal audit system. However there are adequate internal control procedures commensurate with its size and nature of its business.

8. The Central government has not prescribed for the company the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956.

9. According to the records of the Company, the company is not regular in depositing undisputed statutory dues including Tax deducted at source with the appropriate authorities. According to the information and explanation given to us there were no undisputed amount payable in respect of tax deducted at source and outstanding as at 31st March, 2011 for a period of more than six months from the date they became payable. The Income Tax demand for Assessment Year 2008-09 amounting to Rs6,44,51,046/- is disputed and under appeal with CIT (A)-22

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

11.The company has not defaulted in repayment of dues to financial institutions or Bank or Debenture Holders during the year.

12. The company has not granted any loans and advances during the year on the basis of security by way of pledge of shares ,debentures and other securities

13.The company has not given guarantee for loans taken by others from Bank or financial institutions

14.The company has not obtained term loans during the year

15.As per the records of the company, no funds were raised on short term basis and used for long term investment and vice versa.

16.The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

17.The Company has not issued any debentures, and hence creation of securities in respect of debentures does not arise.

18.The company has not raised money by way of public issues.

19.According to the information and explanations furnished to us, no fraud on or by the Company has been noticed or reported during the year.



For VENKATESH & CO.,

CHARTERED ACCOUNTANTS

PLACE: CHENNAI V. DASARATY

DATE : 30.08.2011 PARTNER

M.No.26336

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Mar 31, 2010

We have audited the attached Balance sheet of AUTOMOBILE PRODUCTS OF INDIA LTD as at 31st March, 2010 and the Profit and Loss Account for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes, examining on atest basis, evidence supporting the amounts and disclosure 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 issued by the company Law Board in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

2. Further to our comments in the Annexure referred in paragraph 1 above, we state that:

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

b) In our opinion, the Company has kept proper books of account as required by law so far as appears from our examination of such books.

c) The Balance Sheet and profit and Loss Account referred to in this report are in agreement with the books of account.

d) In our opinion, the Profit and Loss Account and the Balance Sheet comply with the Accounting Standards referred to in Subsections (3C) of section 211 of the Companies Act, 1956.

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

f) In our opinion and to the best of our information and according to the explanations given to us. the said Balance Sheet and the Profit and Loss Account read together with the other notes and accounting policies give the information required by the Companies Act 1956, in the manner so required and gives a true and fair view in conformity with the accounting principles accepted in India:

(i) In so far as it relates to the Balance Sheet, of the state of Affairs of the Company as at 31st March, 2010 and

(ii) In so far as it relates to the Profit and Loss Account of the LOSS of the Company for the year ended on that date.





ANNEXURE: (REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE)

In terms of the information and explanation given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state as under:

1. a) The company has maintained proper records showing full particulars including quantitative details and

situation of Fixed Assets,

b) The Management at reasonable intervals has physically verified the Fixed Assets of the Company. No material discrepancies were noticed on such verification.

c) substantial part of fixed assets has been disposed off during the year without affecting the going concern concept of the business

2. a) The stock of finished goods stores and spare parts have been physically verified at reasonable intervals by the management.

b) The procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

c) The company is maintaining proper records of inventory and no material discrepancies are noticed on such physical verification.

3. The Company has taken interest free advance from companies covered in the register maintained under section 301 of the Companies Act 1956, with out stipulation as to repayment of principal and interest

4 In our opinion and according to the information and explanations given to us there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of stores.spareparts .components, plant and machinery, equipment and other assets and with regard to the sale of goods. No instances of continuing failure to correct major weaknesses in Internal Control were noticed.

5. According to the information and explanations given to us, the transactions of purchase of goods and materials made in pursuance of contracts or arrangements have been duly entered in the register maintained under section 301 of the Companies Act 1956.The transactions made in pursuance of such contracts and aggregating to Rs. 5 Lacs or more during the year in respect of each party were made at prevailing market price

5 The company has not accepted any deposits from the public. The provisions of sections 58A & 58AA of the companies Act. 1956, and the Rules framed there under are not applicable.

7. In our opinion, the company has no seperate internal audit system.However there are adequate internal control procedures commensurate with its size and nature of its business.

8. The Central government has not prescribed for the company the maintenance of cost records under section 209 (1) (d) of the Companies Act. 1956.

9. According to the records of the Company, the company is not regular in depositing undisputed statutory dues including Tax deducted at source with the appropriate authorities. According to the information and explanation given to us the undisputed amount payable in respect of tax deducted at source and outstanding as at 31st March, 2010 for a period of more than six months from the date they became payable is Rs180004

10. The Companys accumulated losses at the end of the financial year are more than fifty percent of its net worth and it has incurred cash losses in the financial year immediately preceeding such financial year.

11. The company has not defaulted in repayment of dues to financial institutions or Bank or Debenture Holders.

12. The company has not granted any loans and advances during the year on the basis of security by way of pledge of shares debentures and other securities

13. The company has not given guarentee for loans taken by others from Bank or financial institutions

14. The company has not obtained term loans during the year

15. As per the records of the company, no funds were raised on short term basis and used for long term investment and vice versa.

16. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

17. The Company has not issued any debentures, and hence creation of securities in respect of debentures does not arise.

18. The company has not raised money by way of public issues.

19. According to the information and explanations furnished to us, no fraud on or by the Company has been noticed or reported during the year.

For M/s Venkatesh & Co, Chartered Accountants

Place : Chennai V. Dasaraty

Date : 01.09.2010 Partner

Memb.No.26336

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Mar 31, 2003

1. We have audited the attached Balance Sheet of AUTOMOBILE PRODUCTS OF INDIA LIMITED, as at 31st March, 2003 and also the Profit and Loss Account for the Company for the year ended on that date. These financial statements are the responsibility of Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have 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.

3. As required by the Manufacturing and Other Companies (Auditors Report) Order, 1988 issued by the Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

a. The accounts have been prepared on a going concern basis even though, the Board for Industrial and Financial Reconstruction (BIFR) has declared the Company, as "Sick Industrial Company", within the meaning of Section 3(1)(o) of the Sick Industrial Companies Act, 1985, and have approved in November 1996 a rehabilitation Scheme providing for closure of Bhandup division where the operations have fully ceased.

b. The accounts for the period ended 30th September, 2001 & 31st March 2002, is yet to be approved by the General Body Meeting and accordingly the accounts for this year is subject to any adjustments arising therefrom as indicated in note 1B.

c. The Company has not completed balance confirmation procedures in respect of debtors, loans and advances and creditors and the balances are subject to adjustment, if necessary (referred to in note 2B(c)).

d. As referred to in note 3 certain statutory liabilities have not been paid.

e. As referred to in Note 4 the liability for gratuity in respect of existing employees of the company have not been ascertained and provided in the books and also no provision has been made in respect of leave encashment entitlements in accordance with Accounting Standard 15 "Accounting for retirement benefits in financial statements of employers", issued by Institute of Chartered Accountants of India.

f. No provision has been made for the following items in the accounts for :-

i. Disputed income tax, sales tax and warranty claims as referred to in note (5).

ii. Loss, if any arising on account of expenditure amount of Rs.53.04 lakhs included under capital work-in- progress in respect of new projects.

iii. For defraying ROC fees on account of enhancement of authorised capital.

iv. For bad and doubtful debts and loans and advances, the amount presently not ascertainable.

g. In the absence of duly reconciled records, we are unable - to express opinion on the accuracy and completeness of the quantitative information disclosed in note 13.

5. Subject to the Matters referred to in Paragraph 4 above,

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

(b) In our opinion, proper books of accounts have been kept by the Company so far as appears from our examination of books made available to us.

(c) The Balance Sheet and Profit and Loss Account are in agreement with the books and records maintained by the Company.

(d) In our opinion, subject to our remarks in Para 4(e) above, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956.

(e) On the basis of written representations from the Directors as on 31st March 2003 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2003 from being appointed as a director in terms of clause(g) sub- section 1 of Section 274 of the Companies Act 1956.

(f) In our opinion and to the best of our information and according to the explanation given to us and subject to the aforesaid qualifications the Balance sheet and Profit and Loss account together with notes given there on and attached thereto, give in the prescribed manner the information required by the Act and also give a true and fair view in confirmity with the accounting principles generally accepted in India;

i. In the case of Balance Sheet, the state of affairs of the company as at 31st March 2003;

ii. In the case of the Profit and Loss Account, the profit for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS REPORT TO THE MEMBERS OF AUTOMOBILE PRODUCTS OF INDIA LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31stl MARCH, 2003.

i. The Company has maintained proper records showing full particulars including the quantitative details and situation of fixed assets except that the situation of asset has not been indicated in the case ot "Furniture, fixtures and office equipment" and certain items of plant and machinery (mainly jigs, fixtures and equipment). In the absence ot any information and explanations with regard to physical verification of asset by management, we are unable to make any comment in this regard. However for safeguarding of fixed assets in our opinion, management should cany out physical verification of all fixed assets once in every year and obtain a legal opinion on the title deeds of immovable properties.

ii. None of fixed assets have been revalued during the year.

iii. As any management representation and any certificate with regard to physical verification of stock of finished goods, raw materials and spare parts and stock lying with third parties respectively has not been made available for our verification, we are unable to express opinion on reasonableness of physical verification carried out by the management during the year.

iv. In the absence of appropriate evidence in the forms of Managements certificate and Managements representation with regard to the procedures of physical verification of stocks followed by management, we are unable to express opinion vis-a-vis the reasonableness and adequacy of the procedures that commensurate with the size of the company and its nature of business.

v. In the absence of appropriate evidence in the forms of Managements certificate and Managements representation with regard to physical verification of stocks , we are unable to comment on the materiality of the discrepancies and its dealt in the books of account.

vi. On the basis of verification of stock records by the management, we are of the opinion that the valuation of stock is fair and proper in accordance with Generally Accepted Accounting principles and is in order as in the previous years.

vii. According to the information and explanation given to us, the company has not taken any loans, secured or unsecured from companies, firms or other parties listed in the Register maintained under Section 301 of the Companies Act, 1956, and /or to companies under the same management as defined under the provisions of the erstwhile Section 370 (1B) of the Companies Act, 1956.

viii. According to the information and explanations given to us, the company has not granted any loans secured or unsecured to companies, firms or other parties listed in the Register maintained under Section 301, of the Companies Act, 1956, and /or from companies under the same management as defined under the provisions of the erstwhile Section 370 (1B) of the Companies Act, 1956.

ix. In respect of loans and advances in the nature of loans given by the company, the parties are repaying the principal amounts as stipulated and are regular in the payment of interest where applicable.

x. In our opinion, based on information and explanations given to us certain items are of special nature for which comparable

quotations are not available and for purchase of stares, raw materials including components, plants and machinery, equipments and other assets and sale of goods, the internal control procedure adopted are further needed to be strengthen to commensurate with the size and the nature of the business.

xi. Based upon information and explanation given to us there were no transactions of purchase and sale of goods and services in purchase of contracts or arrangements extended in Register maintained under Section 301 of the Companies Act 1956 and aggregating during the year to Rs.50000/- or more in respect of each party.

xii. In the absence of information and evidence made available to us with regard to all items of inventory for determination of unserviceable and damaged goods, raw materials, finished goods and trading goods, we are unable to express the opinion regarding creations of adequate provision required for the said purpose.

xiii. Based upon the explanation and information given to us the company has not accepted any public deposits to which Section 58A of the Companies Act 1956, and the Acceptance of Deposit Rules 1975 will apply.

xiv. In our opinion, based on information and explanations given to us, reasonable records have been maintained by company for sale and disposal of realisable scraps. As explained to us the companys manufacturing activity does not generate any by-products.

xv. In our opinion and explanations given to us as required by clause XV para 4A Section 227 (4Aj of the Companies Act, 1956, no internal audit system in commensurating with the size and nature of business.

xvi. As informed that since the company did not carry as any manufacturing activity during the period is respect of scooters and 3-wheelers no cost records under Section 209(1) (d) of the Companies Act, 1956 are being maintained.

xvii. According to the records there were delays in depositing provident fund and employees state Insurance dues with the appropriate authority. As per information given to us, the arrears outstanding at the year end is estimated at Rs 237.77 lakhs.

xviii. According to the information and explanation given to us no undisputed amount payable in respect of Excise duty, wealth tax and customs duty were outstanding as at 31" March, 2003 for a period of more than six months than the date they became payable. An undisputed amount of Rs 42.58 Lacs In respect of Income Tax and sales Tax was outstanding for more than six months as at 31st March 2003.

xix. According to the information and explanation given to us no personal expenses of the employees or director has been changed to Revenue other than those payable under contractual obligation or in accordance with Generally accepted business practice.

xx. The Board for Industrial and Financial Reconstruction has declared the company to be a sick industrial company within the meaning of Section 3(1) (o) of the Sick Industrial Companies (Special Provision) Act,1985.

For Sri & Sri Associates Chartered Accountants

M.B. Sridharan Partner

Chennai

27th December 2003

---

Sep 30, 2001

1 We have audited the attached Balance Sheet of AUTOMOBILE PRODUCTS OF INDIA LIMITED, as at 30th September, 2001 and also the Profit and Loss Account of the Company for the period ended on that date. These financial statements are the responsibility of Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have 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.

3. As required by the Manufacturing and Other Companies (Auditors Report) Order, 1988 issued by the Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

a. The accounts have been prepared on a going concern basis even though, the Board for Industrial and Financial Reconstruction (BIFR) has declared the Company, as "Sick Industrial Company", within the meaning of Section 3(1)(o) of the Sick Industrial Companies Act, 1985, and have approved in November 1996 a rehabilitation Scheme providing for closure of Bhandup division where the operations have fully ceased.

b. The Company has not completed balance confirmation procedures in respect of debtors, loans and advances and creditors and the balances are subject to adjustment, if necessary (referred to in note 2B(c)).

c. As referred to in note 3 certain statutory liabilities have not been paid.

d. As referred to in Note 4 the liability for gratuity in respect of existing employees of the company have not been ascertained and provided in the books and also no provision has been made in respect of leave encashment entitlements in accordance with Accounting Standard 15 "Accounting for retirement benefits in financial statements of

employers", issued by Institute of Chartered Accountants of India.

e. No provision has been made for the following items in the accounts for :-

i. Disputed income tax, sales tax and warranty claims as referred to in note (5).

ii. Loss, if any arising on account of expenditure amount of Rs.53.04 lakhs included under capital work-in-progress in respect of new projects.

iii. For defraying ROC fees on account of enhancement of authorised capital.

iv. For bad and doubtful debts and loans and advances, the amount presently not ascertainable.

f. In the absence of duly reconciled records, we are unable to express opinion on the accuracy and completeness of the quantitative information disclosed in note 14.

5. Subject to the Matters referred to in Paragraph 4 above,

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

(b) In our opinion, proper books of accounts have been kept by the Company so far as appears from our examination of books made available to us.

(c) The Balance Sheet and Profit and Loss Account are in agreement with the books and records maintained by the Company.

(d) In our opinion, subject to our remarks in Para 4(d) above, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the Accounting Standards referred to in Section 1(3C) of the Companies Act, 1956.

(e) On the basis of written representations from the Directors as on 30th September 2001 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th September 2001 from being appointed as a director in terms of clause (g) sub-section 1 of Section 274 of the Companies Act 1956.

(f) In our opinion and to the best of our information and according to the explanation given to us and subject to the aforesaid qualifications the Balance sheet and Profit and Loss account together with notes given there on and attached thereto, give in the prescribed manner the information required by the Act and " also give a true and fair view in confirmity with the accounting principles generally accepted in India;

i. In the case of Balance Sheet, the state of affairs of the company as at 30th September 2001;

ii. In the case of the Profit and Loss Account, the profit for the period ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS REPORT TO THE MEMBERS OF AUTOMOBILE PRODUCTS OF INDIA LIMITED ON THE ACCOUNTS FOR THE PERIOD ENDED 30th SEPTEMBER, 2001.

i. A. The Company has maintained proper records showing lull particulars including the quantitative details and situation of fixed assets except that the situation of asset has not been indicated in the case of "Furniture, fixtures and office equipment" and certain items of plant and machinery (mainly jigs, fixtures and equipment). In the absence of any information and explanations with regard to physical verification of asset by management, we are unable to make any comment in this regard. However for safeguarding of fixed assets in our opinion, management should carry out physical verification of all fixed assets once in every year and obtain a legal opinion on the title deeds of immovable properties.

ii. None of fixed assets have been revalued during the period.

iii. As any management representation and any certificate with regard to physical verification of stock of finished goods, raw materials and spare parts and stock lying with third parties respectively has not been made available for our verification, we are unable to express opinion on reasonableness of physical verification carried out by the management.

iv. In the absence of appropriate evidence in the forms of Managements certificate and Managements representation with regard to the procedures of physical verification of stocks followed by management, we are unable to express opinion vis-a-vis the reasonableness and adequacy of the procedures that commensurate with the size of the company and its nature of business.

v. In the absence of appropriate evidence in the forms of Managements certificate and Managements representation with regard to physical verification of stocks , we are unable to comment on the materiality of the discrepancies and its dealt in the books of account.

vi. On the basis of verification of stock records by the management, we are of the opinion that the valuation of stock is fair and proper in accordance with Generally Accepted Accounting principles and is in order as in the previous years.

vii. According to the information and explanation given to us, the company has not taken any loans, secured or unsecured from companies, firms or other parties listed in the Register maintained under Section 301 of the Companies Act, 1956, and /or from companies under the same management as defined under the provisions of the erstwhile Section 370 (18) of the Companies Act, 1956.

viii. According to the information and explanations given to us, the company has not granted any loans, secured or unsecured from companies, firms or other parties listed in the Register maintained under Section 301, of the Companies Act, 1956, and /or from companies under the same management as defined under the provisions of the erstwhile Section 370 (1B) of the Companies Act, 1956.

ix. In respect of loans and advances in the nature of loans given by the company, the parties are repaying the principal amounts as stipulated and are regular in the payment of interest where applicable.

x. In our opinion, based on information and explanations given to us certain items are of special nature for which comparable quotations are not available and for purchase of stores, raw materials including components, plants and machinery, equipments and other assets

and sale of goods, the internal control procedure adopted are further needed to be strengthen to commensurate with the size and the nature of the business.

xi. Based upon information and explanation given to us there were no transactions of purchase and sale of goods and services in purchase of contracts or arrangements extended in Register maintained under Section 301 of the Companies Act 1956 and aggregating during the year to Rs.50000/- or more in respect of each party.

xii. In the absence of information and evidence made available to us with regard to all items of inventory for determination of unserviceable and damaged goods, raw materials, finished goods and trading goods, we are unable to express the opinion regarding creation of adequate provision required for the said purpose.

xiii. Based upon the explanation and information given to us the company has not accepted any public deposits to which Section 58A of the Companies Act 1956, and the Acceptance of Deposit Rules 1975 will apply.

xiv. In our opinion, based on information and explanations given to us, reasonable records have been maintained by company for sale and disposal of realisable scraps. As explained to us the companys manufacturing activity does not generate any by- products.

xv. In our opinion and explanations given to us as required by clause XV para 4A Section 227 (4A) of the Companies Act, 1956, no internal audit system in commensurating with the size and nature of business.

xvi. As informed that since the company did not carry any manufacturing activity during the period in respect of scooters and 3-wheelers no cost records under Section 209(1) (d) of the Companies Act, 1956 are being maintained.

xvii. According to the records there were delays in depositing provident fund and employees state Insurance dues with the appropriate authority As per information given to us, the arrears outstanding at the period end, is estimated at Rs 170.48 lakhs.

xviii. According to the information and explanation given to us no undisputed amount payable in respect of Excise duty, wealth tax and customs duty were outstanding as at 30th September 2001 for a period of more than six months than the date they became payable. An undisputed amount of Rs 42.58 Lacs in respect of Income Tax and Sales Tax was outstanding for more than six months as at 30th September 2001.

xix. According to the information and explanation given to us no personal expenses of the employees or director has been charged to Revenue other than those payable under contractual obligation or in accordance with Generally accepted business practice.

xx. The Board for Industrial and Financial Reconstruction has declared the company to be a sick industrial company within the meaning of Section 3(1) (o) of the sick Industrial companies (Special provision) Act 1985.

For Sri & Sri Associates Chartered Accountants

M.S. Sridharan Partner

Chennai 15th December, 2003.

---

Mar 31, 2000

We have audited the attached balance sheet of Automobile Products of India Limited as at 31st March, 2000 and also the profit and loss account of the Company for the year ended on that date, annexed thereto and report that:

I. As required by the Manufacturing and Other Companies (Auditors Report) Order, 1988 issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

II. Subject to our comments in the annexure referred to in paragraph 1 above;

a) the accounts have been prepared on a going concern basis even though the Board for Industrial and Financial Reconstruction (BIFR) has declared the Company as "Sick Industrial Company" within the meaning of Section 3(1)(o) of the Sick Industrial CompaniesAct, 1985 and have approved in November, 1996 a rehabilitation scheme providing for closure of Bhandup division where the operations have fully ceased.

b) the accounts for the year ended 31st March, 1999, is yet to be approved by the General Body meeting and accordingly the accounts for this year is subject to any adjustments arising therefrom as indicated in note 1A.

c) no provision has been made in the accounts for the loss, if any, arising on account of expenditure amounting to Rs.53.04 lakhs included under capital work in progress in respect of new projects.

d) the Company has not completed balance confirmation procedures in respect of debtors, loans and advances and creditors and the balances are subject to adjustment, if necessary.(referred to in note 2(c))

e) as referred to in note 4 the liability for gratuity in respect of existing employees of the Company have not been ascertained and provided in the books. Also no provision has been made in respect of leave encashment entitlements.

f) as referred to in note 3 certain statutory liabilities have not been paid.

g) In the absence of duly reconciled records we are unable to express an opinion on the accuracy and completeness of the quantitative information disclosed in note 12.

III. Subject to the matters referred to in paragraph II above:

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

(b) in our opinion, proper books of account have been kept by the company so far as appears from our examination of books made available to us;

(c) the balance sheet and the profit and loss account dealt with by this report are in agreement with the books of account;

(d) In our opinion subject to our remarks in para II (e) above regarding non provision of gratuity and leave encashment benefits in accordance with Accounting Standard 15 " Accounting for retirement benefits in financial statements of employers" issued by Institute of Chartered Accountants of India, the balance sheet and the profit and loss account dealt with by this report comply with the accounting standards referred to in section 211 (3C) of the Companies Act, 1956. The impact on the accounts due to non compliance with the standard has not been computed;

(e) the accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view;

(i) in the case of the balance sheet of the state of affairs of the Company as at 31st March, 2000 and

(ii) in the case of the profit and loss account of the loss of the Company for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE AUDITORS REPORT TO THE MEMBERS OF THE AUTOMOBILE PRODUCTS OF INDIA LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH, 2000

1. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets except that the situation of fixed assets has not been indicated in the case of "furniture, fixtures and office equipments" and certain items of plant and machinery (mainly jigs, fixtures and equipments). As explained to us, some of the fixed assets have been physically verified by the management during the year and that no material discrepancies have been noticed by the management on such verification, however we are unable to make any comment in this regard in the absence of appropriate evidence.

In respect of assets verified during the year and in the earlier years, we are informed that the comparison of items physically verified with the fixed assets records is still in progress. In our opinion, the frequency of physical verification of fixed assets should be increased to cover all fixed assets atleast once over a period of three years.

2. None of the fixed assets has been revalued during the year.

3. As explained to us, the stocks of finished goods, spare parts and raw materials have been physically verified during the year by the management. In our opinion, the frequency of verification is resonable. In case of stocks lying with third parties, certificates for such stocks have been obtained from most of the parties.

4. According to the information and explanations given to us, in our opinion, the procedures of physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the nature of the business.

5. The discrepancies noticed on verification of inventories as compared to the book records were not material.

6. On the basis of our examination of stock records, we are of the opinion, that the valuation of stocks is fair and proper in accordance with normally accepted accounting principles and is on the same basis as in the previous year.

7. According to the information and explanations given to us, the Company has not taken any loans, secured or unsecured from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956 where the rate of interest and other terms and conditions of such loans are prima facie prejudicial to the interest of the Company. In terms of Section 370 (1B) of the Companies Act, 1956, provisions of the Section are not applicable to a company on or after 31st October 1998.

8. According to the information and explanations given to us, the Company has not granted any loans secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956 where the rate of interest and other terms and conditions of such loans are prima facie prejudicial to the interest of the Company. In terms of Section 370(1B) of the Companies Act.1956, provisions of the Section are not applicable to a company on or after 31st October 1998.

9. In respect of loans and advances in the nature of loans given by the Company, the parties are repaying the principal amounts as stipulated and are regular in the payment of interest where applicable,

10. In our opinion and according to the information and explanations given to us, having regard to the explanation given to us, that some of the items are of a special nature and comparable quotations are not available, the Company has internal control procedures, for the purchase of stores, raw materials including components, plant and machinery, equipment and other assets and the sale of goods. However these need to be strengthened to make them commensurate with the size of the Company and the nature of its business.

11. According to the information and explanations given to us, there were no transactions of purchase of goods and materials and sale of goods, materials and services made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956.

12. As explained to us, the company has reviewed all items of inventory for the determination of unserviceable or damaged stores, raw materials and finished goods and adequate provision has been made in the accounts for the loss arising on the items so determined.

13. The Company has not accepted any deposits from the public to which the provisions of Section 58A of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 apply.

14. In our opinion and according to the information and explanations given to us, reasonable records have been maintained by the Company for the sale and disposal of realisable scrap. As explained to us, the Companys manufacturing activities do not generate any by-products.

15. In our opinion, the Companys internal audit system needs to be strengthened to make it commensurate with the size of the Company and the nature of its business.

16. We are informed that since the Company did not carry on any manufacturing activity during the year in respect of scooters and 3 wheelers, no cost records under Section 209 (1) (d) of the Companies Act, 1956 have been maintained.

17. According to the records of the Company, there were delays in depositing Provident Fund and Employees State Insurance dues with the appropriate authorities. As per the information given to us, the arrears outstanding at the year end is estimated at Rs.229.91 lakhs.

18. According to the information and explanations given to us, no undisputed amounts payable in respect of Excise Duty, Wealth Tax and Customs Duty were outstanding as at 31st March, 2000 for a period of more than six months from the date they became payable. An undisputed amount of Rs 42.58 lakhs in respect of income tax and sales tax was outstanding for more than six months as at 31st March, 2000.

19. According to the information and explanations given to us, no personal expenses of employees or directors have been charged to revenue account, other than those payable under contractual obligations or in accordance with generally accepted business practice.

20. The Board for Industrial and Financial Reconstruction has declared the Company to be a Sick Industrial Company within the meaning of Section 3(1)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985.

21. We are informed that in respect of trading activity, no items have been determined as damaged during the year.



For A. F. FERGUSON ASSOCIATES Chartered Accountants

B. RAMARATNAM Partner

Chennai 28th March 2003