2. 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.

3. As required by the Companies (Auditor's Report) Order, 2003 as amended by the Companies (Auditors' Report Amendment) Order 2004 (together "the order"), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said Order.

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

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

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

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

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

(v) on the basis of written representations received from the directors of the Company which were taken on record by the Board of Directors of the Company and the information and explanations as made available, none of the Directors of the Company is disqualified as on 31st March, 2011 from being appointed as a director in terms of Clause (g) of sub- section (1) of section 274 of the Companies Act, 1956;

(vi) in our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with Schedules 1 to 16 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;

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

ANNEXURE TO THE AUDITORS'REPORT OF ORIND EXPORTS LIMITED (Referred to in our report of even date attached)

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

(b) Fixed Assets have been physically verified by the management during the year.

(c) On the basis of our examination of records and according to the information and explanations provided to us, substantial part of fixed assets has not been disposed of during the year by the company.

ii) (a) All purchases have been made against the exact sale order quantities for immediate dispatch. Thus the company does not hold any stock at any point of time. However, physical verification has been done immediately on receipt of goods from the supplier.

(b) In our opinion, procedures of physical verification of inventory followed by the management as stated in paragraph ii(a) above are 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. No material discrepancies were noticed on physical verification.

iii) (a) The company has not granted any loans secured or unsecured during the year to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Loan to Orissa Industries Limited was granted by the company on 14th June, 2003 when none of the directors of the company held more than 2% shares of borrowing company.

(b) In view of our comment in paragraph iii (a) above clauses iii (b), iii(c) and iii (d) of paragraph 4 of the aforesaid order are not applicable to the company.

(c) The company has not taken any loans secured or unsecured from parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(d) in view of our comment in paragraph iii (e) clauses iii (f) and iii (g) of paragraph 4 of the aforesaid order are not applicable to the company.

iv) 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. However in respect of application of Refractory products internal control needs to be further strengthened. Further during the course of our audit, we have neither come across nor have we been informed of any continuing failure to correct major weakness in the internal control system.

v) (a) According to the information and explanations provided by the management and based on the audit procedures applied by us, the transactions during the year that needs to be entered into the Register in pursuance of Section 301 of the Companies Act, 1956 has been so entered.

(b) According to the information and explanations provided by the management and based on the audit procedures applied by us, the provision of clause v (b) of paragraph 4 of the aforesaid order is not applicable to the company.

vi) According to the information and explanations given to us, the company has not accepted any deposits from the public under section 58A and 58AA of the Companies Act, 1956. Further during the course of our audit we have neither come across nor have we been informed of any order passed under the aforesaid sections by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

vii) There is no internal audit system.

viii) As explained to us. the Central Government has not prescribed maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956.

ix) (a) As explained to us investor education and protection fund, employees state insurance, sales tax, excise duty and cess are not applicable to the company. In respect of other statutory dues (except income tax & provident fund) the company is regular in depositing dues with the appropriate authorities.

According to the records of the company, there was delay in payment of provident fund dues for eight months. However, as on 31st March, 2011 there was no arrear dues.

According to the records of the company arrears of undisputed income tax outstanding as on 31st March, 2011 for a period of more than six months from the date they became payable is Rs. 20,88,797/-.

(b) According to the information and explanations given to us, there are no dues of wealth tax, service tax, custom duty, excise duty and cess which have not been deposited on account of any dispute.

x) The company has accumulated losses and has incurred cash losses during the year covered by our report and in the immediate previous financial year covered in our report.

xi) Based on our audit procedures and on the information and explanations given by the management, the Company has not defaulted in repayment of dues to a financial institution or bank. The Company has not issued any debentures.

xii) Based on our examination of documents and records, we are of the opinion that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debenture and other securities.

xiii) In our opinion, the Company is not a chit fund or a nidhi/mutuai benefit fund/ society. Therefore, the provision of clause (xiii) of paragraph 4 of the order is not applicable to the Company.

xiv) According to the records of the Company, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provision of clause (xiv) of paragraph 4 of the order is not applicable to the Company.

xv) The company has given two guarantees for Rs. 2912 lacs in aggregate in respect of loan taken by a company from Banks. The term and conditions of such guarantee are not prejudicial to the interest of the company. Steps have been taken by the company for release of such guarantees.

xvi) The Company has not taken any term loan during the year. Accordingly, the provision of clause (xvi) of paragraph 4 of the aforesaid order is not applicable to the Company.

xvii) On an over aii examination of the Balance Sheet of the Company and according to the information and explanations given to us, we report that no funds raised on short-term basis have been used for long-term investments.

xviii) The company has not raised any money by issue of shares during the year. Therefore, the provision of clause (xviii) of paragraph 4 of the aforesaid order is not applicable to the Company.

xix) The provision of clause (xix) of paragraph 4 of the aforesaid order is not applicable, as the Company has not issued any debentures.

xx) The provision of clause (XX) of paragraph 4 of the aforesaid order is not applicable, as the Company has not raised any money during the year by public issues.

xxi) During the course of our examination of books of account carried out in accordance with generally accepted auditing practices, we have neither come across any instance of fraud on or by the Company nor have we been informed of such case by the management.

                                                  For Ray & Ray

                                           Chartered Accountants

                                  Firm's Registration No 301072E

                                                   (B. K. Ghosh)

Place: Kolkata                                           Partner

Date : 5th August, 2011                    Membership No. 051028