2 We conducted our audit in accordance with auditing standards generally accepted in India. Those standard 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 the 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 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 matter specified in paragraphs 4 and 5 of the said order to the extent applicable

4 Further to our comments in the annexure .referred to 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 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, Profit & Loss Account dealt by this report are in agreement with the books of accounts.

iv in our opinion, the Balance sheet and Profit & 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 30th September, 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th September, 2010 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956 and

vi in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act" 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted India.

a in the case of balance sheet, of the state of affiars of the Company as at September 30, 2010

b in the case of Profit & Loss Account, of the LOSS for the year ended on that date.

c in the case of cash flow statements, of the cash flows for the year ended on that date.

Annexure to the Auditors Report

Re: ELECTRIC CONTROL GEAR (INDIA) LIMITED

(referred to in paragrph 3 of our report of even date)

i (a) The Company has no fixed assets, hence comments on paragraph no 1(b) and (c) are not applicable.

ii (a) During the year, the company does not carrying any "trading and manufacturing activities and having no inventory, hence paragraph 4(ii)(a), (b),(c) and (d) are not applicable.

iii (a) The company has not taken the unsecured loan from the party, covered under section 301 of the companies Act, 1956.

(b) in our opinion , the rate and other terms and conditions of loans given or taken by the company, secured or unsecured, are not prima facie prejudicial to the interest of the company.

(c) In our opinion, the nature of the loans are current account type, hence there is no stipulation of time for repayment, therefore it is not possible for us to opion, whether the parties had repaid the principal and interest.

(d) in our opinion, there is no overdue of more than One lacs rupees during the year under report.

iv In our opinion and according to the information and explanations given to us, there are adequate internal control procedures common surate with the size of the company and the nature of its business, with regards to purchases of fixed assets and with regards to the sale of goods and services, During the course of our audit, we have not observe any major weakness in the internal controls.

(5)(a) To the best of our knowledge and belief and according to the information and explanations or given to us, there,are no transaction which particulars of contracts or arrangements referred to in section 301 of the companies Act, 1956 have to be entered in the register required to be maintained under that section

(b) There are no such transaction made in pursuance of such contract or arrangements for more than Rs 5.00 Lacs.

(6) In our opinion and according to the information and explanation given to us, the company has not accepted deposits u/s 58A & 58AA of the Companies Act, 1956 from the public during the year.

(7) In our opinion, the company has an internal audit system commensurate among the size and nature of its business.

(8) According to the information and explanation given to us, the central government has not prescribed maintance of cost records under clause (d) of sub-section (1) of section 209 of the companies Act. 1956 for any of the products of the company .

(9a) According to the information and explanations given to us, the company is generally regular in deposting with appropriate authorities undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, custom duty, excise duty, service tax, cess and other materials statutory dues applicable to it

(b) According to the information and explanation given to us, no undisputed amounts payable in respect of income tax, sales tax, custom duty, excise duty, and cess were in arrears as at September 30, 2010 for period of more than six month from the date they become payable.

(c) According to the information and explanation given to us, there is no dues of sales tax, income tax, custom duty, excise duty and service tax which have not been deposited on account of any dispute, except the following.

Income Tax Demand Rs. 43.04 Lacs AY 1996-97 ITAT, Ahmedabad

Income Tax Demand Rs 0.16 Lacs AY 1997-98 ITAT, Ahmedabad

Income Tax Demand Rs 0.49 Lacs AY 2000-01 ITAT, Ahmedabad

Income Tax Demand Rs 290.76 Lacs AY 2004-05 ITAT, Ahmedabad

(10) The company is registered for a period not less than 5 years and does have accumulated losses & are more than fifty percent of its net worth and the Company has also incurred cash losses in such financial year covered by our audit and in the immediately proceeding financial year.

(11) In our opinion and according to the information and explanation given to us the company has not defaulted in repayment of dues to a financial institution or bank .

(12) In our opinion and according to the information and explanation 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.

(13) In our opinion and according to the information and explanation given to us, the company is not dealing in or trading in shares, securities, debentures and other investment. Accordingly the provisions of clause 4 (xiv) of the company (Auditor's Report) order, 2003 are not applicable to the company.

(14) In our opinion and according to the information and explanation given to us the terms and conditions on which the company has given guarantee for loans taken by others from banks or financial institution is contingent in nature and the company on behalf such gurantee has been executed is under liquidation before the official liquidator of High Court, which outcome may result in prejudicial to the interest of the company.

(15) In our opinion and according to the information and explanations given to us, no term loans have been applied and were raised during the year.

(16) In our opinion and according to the information and explanations given to us, and on an over all examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term-investment

(17) In our opinion , the company has not made any preferential allotment of shares to parties and companies covered in the register maintained u/s 301 of the Act.

(18) In our opinion, the company has not issued debentures and therefore the question of creation of security in respect of debentures does not arise.

(19) In our opinion, during the year the company has not raised monies from the public.

(20) To the best of our knowedge 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.

Clauses 4 (xiii) of the companies (Auditor's Report) order, 2003 is not Applicable to the company .

For, Surendra Jindal & Associates

Chartered Accountants

(Surendra Jindal)

Proprietor

M N : 101776

Date: 02/11/2010

Place: Ahmedabad