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 notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th 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 are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the 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, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Basis for Qualified Opinion

1. Note 28 and 29 of the financial statements, wherein the management of the company has considered Trade Receivables of Rs. 5,77,31,233 Other Receivables of Rs. 8,19,20,827 and advances to Rs. 72,18,468 as good and recoverable. In the absence of external confirmation from the customer/parties from whom these amounts are due and having regard to the age of these balances, we are unable to comment the extent to which these balances are recoverable.

2. Note 31 the financial statements, in respect of expiry of Gas supply agreement and restoration of company's operation being dependent upon the extension of gas supply agreement.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matters described in the Basis for Qualified Opinion paragraph above, 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 Statement of Profit and Loss, of the loss for the year ended on that date; and iii. in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

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

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

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 as required by law have been kept by the Company so far as appears from our examination of those books.

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

d. Except for the effect of the matters described in the Basis for Qualified Opinion paragraph, 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 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.

e. 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 Act.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

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

b. A major portion of the fixed assets has been physically verified by the management during the year pursuant to a programme for physical verification of fixed assets, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets.

c. Fixed Assets disposed off during the year were not substantial and therefore do not affect the going concern status of the company.

ii. a. The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b. The procedures of physical verification of inventories followed by the management 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. The discrepancies noticed on verification between the physical stocks and the book records have been properly dealt with in the books of account.

iii. a. The company has granted interest free inter corporate loan to a company. The maximum amount involved during the year was Rs. 28,120,450 and yearend balance was Rs.17,964,928.

b. As stated in note to the financial statements, regarding proposal of conversion of interest free loan given, in to equity shares of the borrower company, we are unable to express an opinion as to whether the terms and conditions of the interest free loan are, prima facie, prejudicial to the interest of the company.

c. According to the information and explanations given to us, the principal is repayable on demand. Accordingly, we are unable to comment as to whether the party has been regular in payment of interest to the company.

d. 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 covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of the clause 4 (iii) (d), (iii) (e), (iii) (f) and (iii) (g) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

iv. In our opinion and according to the information and explanations given to us, there exists an 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 with regard to the sale of goods and services. During the course of our audit, we have neither observed nor have been informed of any continuing failure to correct major weaknesses in internal control system of the company.

v. a. In our opinion, and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rs. 500,000 in respect of any party during the year have been made at prices which are reasonable with regard to the prevailing market prices at the relevant time.

vi. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits under the provisions of Sections 58A, 58AA and other relevant provisions of the Companies Act, 1956 and the rules framed there under.

vii. In our opinion, the company has an internal audit system commensurate with the size and nature of its business.

viii. There being no manufacturing operations of the company during the year, the books of account required to be maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 in respect of manufacturing operations have not been maintained.

ix. a. According to the information and explanations given to us, the company is generally regular in depositing with the appropriate authorities undisputed statutory dues including investor education and protection fund, income-tax, sales-tax, wealth tax, custom duty, excise duty, cess and any other statutory dues applicable to it except for Tax Deducted at Source, Service Tax and Provident Fund where there have been regular delay.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of income-tax, sales-tax, wealth tax, service tax, custom duty and excise duty were in arrear as at March 31, 2014 for a period of more than six months from the date they became payable except income tax deducted at source amounting Rs. 71,979 and Service tax amounting Rs. 60,392.

c. According to information and explanations given to us, there are no dues of income-tax, sales tax, wealth tax, service tax, customs duty, excise duty or cess or any other statutory dues which have not been deposited on account of any dispute.

x. In our opinion, the accumulated losses of the Company at the end of the financial year are not more than fifty percent of its net worth. The company has incurred cash losses in the financial year covered by our audit and in the immediately preceding financial year.

xi. In our opinion and according to the records of the company examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to any financial institution or bank except the following dues:

Amount of Default              Due date           Period of default
                                                      (in days)
Principal    Interest

3,94,583     1,48,652          30.04.2013                 127

3,94,583     1,56,478          31.05.2013                  96

3,94,583     1,45,429          30.06.2013                  83

3,94,583     1,45,111          31.07.2013                 149

3,94,583       91,930          31.08.2013                 118

               56,309          31.08.2013                 209

3,94,583     1,29,602          30.09.2013                 179

3,94,583     1,29,540          31.10.2013                 148

3,94,583       23,493          30.11.2013                 118

             1,04,667          30.11.2013                 121

2,41,666     1,23,601          31.12.2013                  90

2,41,666     1,16,998          31.01.2014                  59

2,41,666     1,06,414          28.02.2014                  31

1,52,917        9,179          31.12.2013                  87

1,52,917        5,050          31.01.2014                  56

1,52,917        4,617          28.02.2014                  28

xii. In our opinion and according to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the company is not a chit fund or a nidhi /mutual benefit fund/ society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

xiv. According to the information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

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

xvi. In our opinion, and according to the information and explanations given to us, term loans have been applied for the purposes for which they were raised.

xvii. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the company, we report that no funds raised on a short-term basis have been used for long- term investment.

xviii. The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year. Accordingly, the provisions of clause 4 (xviii) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

xix. The company has not issued any debentures during the year.

xx. The company has not raised any money by public issues during the year. Accordingly, the provisions of clause 4 (xx) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

xxi. To the best of our knowledge and belief and 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 CHATURVEDI & PARTNERS
                                 Chartered Accountants
                                 Firm Registration No. 307068E

New Delhi                        R N CHATURVEDI
                                 Partner 
May 31, 2014                     Membership No. 092087