ఆడిటర్ నివేదిక Namtech Electronic Devices Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of M/s NAMTECH ELECTRONIC DEVICES LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 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 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 procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the 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:

i. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

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

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

Report on Other Legal and Regulatory Requirements

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 paragraphs 4 and 5 of the Order.

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 subsection (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 Act2013; and

v. on the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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 THE AUDITORS'' REPORT TO THE MEMBERS OF NAMTECH ELECTRONIC DEVICES LIMITED

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

(b) These fixed assets have been physically verified by the management at reasonable intervals. Discrepancies noticed on such verification are properly dealt with in the books of account.

(c) The company has written off a portion of fixed Assets in the current financial year.

(2) As there is no stock of inventory, reporting under clauses 4(ii)(a),(b) & (c) of Companies (Auditor''s Report) Order, 2003 does not arise

(3) (a) As informed to us, the Company has made an interest free advance to its subsidiary company, covered in the register maintained under section 301 of the Companies Act,1956. The maximum amount involved during the year was Rs.1.92 lacs and the year-end balance of the loan taken from such party was Rs.20.49 lacs

(b) The Company has taken interest free loans from two of its directors, covered in the register maintained under section 301 of the Companies Act, 1956, for which no terms and conditions are prescribed. The maximum amount involved during the year was Rs.66.50 lacs and the year-end balance of the loan taken from such parties was Rs.232.35 lacs respectively.

(4) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and for the sale of goods and service. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

(5) During the year the company has not entered into any contracts or arrangements referred to in section 301 of the Act, Accordingly reporting under clause 4(v) of Companies (Auditor''s Report) Order, 2003 does not arise.

(6) The company has not accepted from public any deposits within the meaning of Section 58A and 58AA of the Companies Act, 1956, and the Rules framed there under.

(7) The company is not having internal audit system during the year.

(8) According to the information and explanations given to us, the Central Government has not prescribed maintenance of Cost Records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956.

(9) (a) As per the information given to us, undisputed amounts payable in respect of: Income Tax Rs.112.50 lacs Investor Education and Protection Fund Rs.14.64 lacs were outstanding for a period of more than six months from the date they became payable (to the extent identified pending review and reconciliation of the relevant accounts). The due dates for these amounts are as per respective statutes.

(b) According to the information and explanations given to us, there are no disputes in respect dues of sales tax/ income tax/ customs duty/ service tax/ wealth tax/ excise duty/cess.

(10) The accumulated losses of the company at the end of the financial year are more than fifty per cent of its net worth and it has incurred cash losses of Rs.18.61 lacs during the financial year under report and Rs. 3.71 lacs in the immediately preceding financial year.

(11) The company is not having borrowings from any financial institutions or banks and there are no debenture holders.

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

(13) The company is neither Nidhi/Mutual Benefit Fund/Societies nor a Chit Fund company and accordingly the matter referred to clause 4 (xiii) are not applicable.

(14) The company is not dealing or trading in shares, securities, debentures or other investments.

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

(16) According to the information and explanations given to us, no term loans are availed during the year.

(17) According to the information and explanations given to us, no funds are raised on short term basis during the year.

(18) The company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

(19) The company has not issued any debentures.

(20) The company has not raised money by public issues during the year.

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

For CHANDRAN & RAMAN. Chartered Accountants Firm''s Registration No.571-S

H.M. MUKUNDACHAR Partner

Membership No: 213074

Place: Bangalore

Date : 14th July 2014

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Mar 31, 2012

We have audited the accompanying financial statements of M/s NAMTECH ELECTRONIC DEVICES LIMITED ("the Company”), which comprise the Balance Sheet as at March 31, 2012, 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 materialmisstatement, 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 procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the 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 explanation: given to us, the financial statements give the information required by the Act ii the manner so required and give a true and fair view in conformity with th< accounting principles generally accepted in India: in the case of the Balance Sheet, of the state of affairs of the Company as a March 31, 2012; in the case of the Profit and Loss Account, of the Loss for the year ended on tha date; and in the case of the Cash Flow Statement, of the cash flows for the year endec on that date

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor’s Report) Ordet, 2003 ("the Order”] issued by the Central Government of India in terms of sub-section (4A) ol section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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; 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 [and proper returns adequate for the purposes of our audit have been received from branches not visited by us]29; .

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 [and with the returns received from branches not visited by us]30; in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

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

ANNEXURE TO THE AUDITORS’ REPORT TO THE MEMBERS OF NAMTECH ELECTRONIC DEVICES LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31.03.2012

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

(b) These fixed assets have been physically verified by the management at reasonable intervals. Discrepancies noticed on such verification are properly dealt with in the books of account.

(c)The company has not disposed off major portion of fixed assets during the year.

(2) As there is no stock of inventory, reporting under clauses 4(ii)(a),(b) & (c) of Companies (Auditor's Report) Order, 2003 does not arise

(3) (a)As informed, the Company has made an interest free advance to its subsidiary company, covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 165.89 lacs and the year-end balance of the loan taken from such party was Rs. 165.89 lacs

(b) The Company has taken interest free loans from two of its directors, covered in the register maintained under section 301 of the Companies Act, 1956, for which no terms and conditions are prescribed. The maximum amount involved during the year was Rs. 165.89 lacs and the year-end balance of the loan taken from such parties was Rs.165.89 lacs respectively.

(4) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and for the sale of goods and service. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

(5) During the year the company has not entered into any contracts or

arrangements referred to in section 301 of the Act, Accordingly reporting under clause 4(v) of Companies (Auditor's Report) Order, 2003 does not arise.

(6) The company has not accepted from public any deposits within the meaning of Section 58A and 58AA of the Companies Act, 1956, and the Rules framed there under.

(7) The company is not having internal audit system during the year.

(8) According to the information and explanations given to us, the Central Government has not prescribed maintenance of Cost Records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956.

(9) (a) As per the information given to us, undisputed amounts payable in respect of:

Central Sales Tax Rs.42.08 lacs,

Karnataka Sales Tax Rs.5.39 lacs,

Tax Deducted at Source Rs.0.02 lacs

Income Tax Rs.132.23 lacs

Investor Education and Protection Fund Rs.14.64 lacs

Were outstanding for a period of more than six months from the date they became payable (to the extent identified pending review and reconciliation of the relevant accounts). The due dates for these amounts are as per respective statutes.

(b) According to the information and explanations given to us, there are no disputes in respect dues of sales tax/ income tax/ customs duty/ service tax/ wealth tax/ excise duty/cess.

(10) The accumulated losses of the company at the end of the financial year are more than fifty per cent of its net worth and it has incurred cash losses of Rs.119.02 lacs during the financial year under report and Rs.24.81 lacs in the immediately preceding financial year.

11) The company is not having borrowings from any financial institutions or banks and there are no debenture holders.

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

13) The company is neither Nidhi/Mutual Benefit Fund/Societies nor a Chit Fund company and accordingly, the matter referred to clause 4 (xiii) are not applicable.

(14) The company is not dealing or trading in shares, securities, debentures or other investments.

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

(16) According to the information and explanations given to us, no term loans are availed during the year.

(17) According to the information and explanations given to us, no funds are raised on short term basis during the year.

(18) The company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

(19) The company has not issued any debentures.

(20) The company has not raised money by public issues during the year.

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

for CHANDRAN & RAMAN Chartered Accountants

Bangalore H.M. MUKUNDHACHAR

25.08.2012 Partner, Membership No. 213074

Firm's Regn No. 00571

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Mar 31, 2011

We have audited the attached Balance Sheet of NAMTECH ELECTRONIC DEVICES LIMITED as at 31st March, 2011, the Profit and Loss Account and also 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 oh our audit.

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

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

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

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

(ii) In our opinion, proper books of accounts as required by law have been kept by the company so far as appears from our examination of those books; (iii) The Balance Sheet and the Profit and Loss Account dealt with by this Report are in agreement with the books of accounts;

(iv) In our opinion, the Balance Sheet and Profit and Loss Account dealt with by this report comply with the accounting standards referred to in sub- section(3C) of Section 211 of the Companies Act, 1956;

(v) On the basis of written representations received from the directors, as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2011 from being appointed as 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, subject to our inability to express an opinion on the reliability of Rs.1.98 Crores shown as capital WIP, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

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

(b) These fixed assets have been physically verified by the management at reasonable intervals. Discrepancies noticed on such verification are properly dealt with in the books of account.

(c) The company has not disposed off major portion of fixed assets during the year.

(2) As there is no stock of inventory, reporting under clauses 4(ii)(a),(b) & (c) of Companies (Auditor's Report) Order, 2003 does not arise

(3) (a) As informed, the Company has made an interest free advance to its subsidiary company, covered in the register maintained under section 301 of the Companies Act,1956. The maximum amount involved during the year was Rs.22.79 lacs and the year-end balance of the loan taken from such party was Rs 22.66 lacs

(b) The Company has taken interest free loans from two of its directors, covered in the register maintained under section 301 of the Companies Act, 1956, for which no terms and conditions are prescribed. The maximum amount involved during the year was Rs. 135.94 lacs and the year-end balance of the loan taken from such parties was Rs.134.91lacs respectively.

(4) In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and for the sale of goods and service. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

(5) During the year the company has not entered into any contracts or arrangements referred to in section 301 of the Act, Accordingly reporting under clause 4(v) of Companies (Auditor's Report) Order, 2003 does not arise.

(6) The company has not accepted from public any deposits within the meaning of Section 58A and 58AA of the Companies Act, 1956, and the Rules framed there under.

(7) The company is not having internal audit system during the year.

(8) According to the information and explanations given to us, the Central Government has not prescribed maintenance of Cost Records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956.

(9) (a) As per the information given to us, undisputed amounts payable In respect of:

Central Sales Tax Rs.119.07 lacs,

Karnataka Sales Tax Rs.6.26 lacs,

Tax Deducted at Source Rs.0.05 lacs

Income Tax Rs.132.23 lacs

Investor Education and Protection Fund Rs.14.64 lacs were outstanding for a period of more than six months from the date they became payable (to the extent identified pending review and reconciliation of the relevant accounts). The due dates for these amounts are as per respective statutes.

(b) According to the information and explanations given to us, there are no disputes in respect dues of sales tax/ income tax/ customs duty/ service tax/ wealth tax/ excise duty/cess.

(10) The accumulated losses of the company at the end of the financial year are more than fifty per cent of its net worth and it has incurred cash losses of Rs.24.56 lacs during the financial year under report and Rs.9.78 lacs in the immediately preceding financial year.

(11) The company is not having borrowings from any financial institutions or banks and there are no debenture holders.

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

(13) The company is neither Nidhi/Mutual Benefit Fund/Societies nor a Chit Fund company and accordingly, the matter referred to clause 4 (xiii) are not applicable.

(14) The company is not dealing or trading in shares, securities, debentures or other investments.

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

(16) According to the information and explanations given to us, no term loans are availed during the year.

(17) According to the information and explanations given to us, no funds are raised on short term basis during the year.

(18) The company has not made any preferential allotment of shares during the year to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

(19) The company has not issued any debentures.

(20) The company has not raised money by public issues during the year.

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

for CHANDRAN & RAMAN

Chartered Accountants (H M MUKUNDACHAR) BANGALORE Partner

Dt. 02.09.2011 Membership No.213074

Firm's Regn No: 000571S

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Mar 31, 2010

We have audited the attached Balance Sheet of NAMTECH ELECTRONIC DEVICES LIMITED as at 31st March, 2010, the Profit and Loss Account and also 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 the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial . statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

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

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

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

(iii) The Balance Sheet and the Profit and Loss Account dealt with by this Report are in agreement with the books of account;

(iv) In our opinion, the Balance Sheet and Profit and Loss Account dealt with by this report comply with the accounting standards referred to in sub- section (3C) of Section 211 of the Companies Act, 1956;

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

(vi) Subject to Note No: 1 in the Schedule 13 to the Balance Sheet regarding suspension of trading of companys shares in the Stock Exchanges and thereby the company is losing the status of Listed Company, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

ANNEXURE TO THE AUDITORS REPORT TO THE MEMBERS OF NAMTECH ELECTRONIC DEVICES LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31-03-2010

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

(b) These fixed assets have been physically verified by the management at reasonable intervals. Material discrepancies noticed on such verification are properly dealt with in the Books of Account.

(c) As the company had, in earlier year, sold Factory Land, Factory Building, Plant and Machineries and other Fixed Assets at Factory and it has affected the going concern status.

2. (a) Physical verification of inventory does not arise as there is no inventory.

(b) Though there is no stock of inventory, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of ¦ its business.

(d) The maintaining of proper records of inventory during the year does not arise as there is no inventory

3. As per the information and explanations given to us, the company has neither granted nor taken any loans, secured or unsecured to / from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956, except interest free advances made to its Subsidiary Company in the normal course of business and accordingly the matters referred to in clause 4(iii) are not applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and for the sale of goods and service. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

5. (a) According to the information and explanations given to,us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) According to the information and explanations given to us, there are no transactions exceeding the value, of Five lakh rupees in respect of each party during the financial year.

6. The company has not accepted from public any deposits within the meaning of Section 58A and 58AA of the Companies Act, 1956, and the Rules framed there under.

7. The company is not having internal audit system during the year.

8. According to the information and explanations given to us, the Central Government has not prescribed maintenance of Cost Records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956.

9. The Company is not regular in depositing undisputed statutory dues, as may be applicable to the company, including Investor Education and Protection Fund, Income-tax, Sales-tax, and other statutory dues with the appropriate authorities and the extent of the arrears of outstanding statutory dues as at the last day of the financial year for a period of more than six months from the date they became payable in respect of Investor. Education and Protection Fund is Rs. 14,63,993/- and in respect of Sales Tax is Rs.1,25,32,816/-

10. The accumulated losses of the company at the end of the financial year are more than fifty per cent of its net worth and it has incurred cash losses during the financial year under report and also in the immediately preceding financial year.

11. The company does not have borrowings during the year from any financial Institutions or Banks and there are no debenture holders.

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

13. The company is neither Nidhi/Mutual Benefit Fund/Societies nor a Chit Fund company and accordingly, the matter referred to clause 4 (xiii) are not applicable.

14. The company is not dealing or trading in shares, securities, debentures or other investments.

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

16. According to the information and explanations given to us, term loans were applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us, the funds raised on short term basis have not been used for long term investments.

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

19. The company has not issued any debentures.

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

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

For KUMBHAT & CO.,

Chartered Accountants

BANGALORE T. J. KHAN

DT: 30-08-2010 Partner

Membership No.023130

Firms Regn No. 001609S