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 and financial performance of the Company in accordance with the Accounting Standard referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") (which continues to be applicable in respect of section 133 of the Companies Act, 2013 in terms of general Circular 15/2013 dated September 13, 2013), and in accordance with the accounting principles generally accepted in India. This responsibility include 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.

Auditors' Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with the Standards of Auditing issued by the Institutes of Chartered Accountants of India. Those Standards require that I 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.

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

Basis for Qualified Opinion

The Company has not provided for liabilities on account of compensated absence and gratuity liability on acturial basis and no provision is made for the defered tax Liability/Assets in the books of account, which is a departure from the accounting standards referred to in sub-section 3(C) of section 211 of the Act The impact whereof on the Profit & Loss Account and net worth is indeterminate.

Qualified Opinion

In my opinion and to the best of my information and according to the explanations given to me, except for the effect of the matter described in the Basis for Qualified Opinion paragraph, 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 March 31, 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 Cash Flow Statement of the Cash Flows of the Company 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, I 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, I report that

a. I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of my audit.

b. In my opinion proper book's of account as required by the law has been kept by the Company so far as appears from my examination of those books.

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

d. In my opinion, the Balance Sheet and 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 (which continue to be applicable in respect of section 133 of the Companies Act, 2013 in, terms of general circular 15/2013 date 13th September, 2013 of the Ministry of Corporate Affairs), except that Company has not made provision for Gratuity Liability and compensated absence, based on acturial valuation as stipulated in AS-15 Employee Benefit (Revised) and the company has not provided for deferred tax Liability/Assets as stipulated in AS-22, Accountingfor Taxes on Income, and has not made related party disclosure as stipulated in AS-18 on related party disclosure/transaction.

e. On the basis of the written representation received from the Directors as on 31st March, 2014 taken on record by the Board of Directors, none of the

f. Directors is disqualified as on 31st March, 2014 from being appointed as a Director in terms of section 274(i) (g) of the Act. '

Annexure to the Independent Auditors Report

RE : NIDHI GRANITES LIMITED

(Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements section of my Report of even date.)

(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets.

(b) All the assets have not been physically verified by the management during the year but there is a regular program of verification, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) The Company has not disposed off substantial part of fixed assets during the year.

(ii) (a) The Inventory has been physically verified during the year by the management. In my 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 and no material discrepancy was noticed on physical verification of inventory

(iii) In my opinion and according to the information and explanations given to me, the Company has not granted / taken loans secured or unsecured to/from company, firms or other parties covered in the register, maintained under section 301 of companies Act.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods. There is no major weakness in internal control.

(v) (a) According to the information and explanations given to me, I am 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) In my opinion and according to the information and explanations given to me, there are no transactions that need to be entered in the register maintained u/s.301 of the Company's Act, 1956 and exceeding the value of Rs.5,00,000/- in respect of any party during the year.

(vi) The Company has not accepted deposit from public during the year.

(vii) The Company does not have its own internal audit department nor have they entrusted the work of internal audit to an outside agency.

(viii) I am informed that no cost records are prescribed by the Central Government under section 209(i) (d) of the Companies Act, 1956 for the Company's business.

(ix) The Company has no undisputed or disputed statutory dues including Income-tax, Sales-tax, Wealth-tax, Custom Duty, Excise Duty, Cess Tax, etc. The Company does not have a Provident Fund and ESIC Scheme for its employees. There were no undisputed amount payable in respect Income Tax, Sales Tax, Custom Duty, Excise Duty, Cess Tax and other material statutory dues in arrears as at 31st March, 2014 for a period of more than six months from the date they become payable.

(x) The Company has no accumulated losses. The Company has not incurred cash losses during the financial year and in the financial year immediately preceding year the company has not incurred cash losses.

(xi) In my opinion and according to the information and explanations given to me the Company has no dues outstanding against financial institution, banks, or debenture holders.

(xii) In my opinion and according to the information and explanations, 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 my opinion the Company is not a chit fund or a Nidhi mutual benefit fund/society. Therefore the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

(xiv) The Company is dealing or trading in shares, securities and other investments. Proper records have been maintained of the transactions and contracts. The shares, securities have been held by the Company in its own name.

(xv) In my opinion and according to the explanations given to me, the Company has not given any guarantees for loans taken by others from bank or financial institutions.

(xvi) The Company has not raised term loans during the year.

(xvii) According to the information and explanations given to me and on an overall examination of the Balance Sheet of the Company, I report that no funds raised on short term basis has been used for long term investment.

(xviii) In my opinion and according to the information and explanations given to me 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.

(xix) The Company has not issued any debentures during the period covered by the audit.

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

(xxi) According to the information and explanations given to me, no fraud on or by the Company has been noticed or reported during the course of my audit.

                                                 For K. N. GANDHI & Co.
                                                 CHARTERED ACCOUNTANTS

                                                          Sd/-
                                                     (K.N. GANDHI)
                                                       PROPRIETOR
Place: Mumbai
Date: 31/07/2014