Independent Auditor's Report on the Standalone lnd AS Financial Statements

To The Members of Consolidated Construction Consortium Ltd.

We have audited the accompanying standalone Ind AS financial statements of Consolidated Construction Consortium Limited

("the Company"), which comprise the Balance Sheet as at 31stMarch 2018, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes in Equity, the Cash Flow statement for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 4 of the Companies (Indian Accounting Standards) Rules, 2015. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS 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 standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under and the Order issued under section 143(11)of the Act.

We conducted our audit in accordance with the Standards on Auditing specified under Section143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments; the auditor considers internal financial control relevant to the Company's preparation of the standalone lnd AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors as well as evaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us.the standalone Ind AS 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 including the Ind AS, of the state of affairs (financial positions) of the Company as at March 31, 2018 and its loss (financial performance including other comprehensive income) , its cashflows and the changes in equity and for the year ended on that date.

Material Uncertainty Related to Going Concern

We draw your attention to Note No. 47 of the standalone financial statements, which indicates that the company has negative net worth as at 31.03.2018. Further, it has incurred net cash losses in the current financial year and in the immediate preceding financial year. These conditions may cast doubt about the Company's ability to continue as a going concern. However, the Company is looking out for potential investors to raise cash by selling the non-core assets held by its subsidiaries or otherwise and with approved S4A scheme in place, the Company expects improvemen tin the overall level of Operations ln view thereof and expecting favourable market conditions in future, the Standalone Financial Statements have been prepared on a "going concern basis" and no adjustment has been made to the carrying value of assets and liabilities. Our Report is not modified in respect of this matter.

Emphasis of Matters

(a) We draw attention to Note No. 8(a) & 8(b) of the standalone financial statements, regarding uncertainties relating to recoverability of trade receivables overdue for more than one year amounting to Rs.11731.84 lakhs (net of provisions of Rs.10740.27lakhs) which according to the managementis fully recoverable. Further the recoverability of trade receivables which are under arbitration amounting to Rs. 36642.92 lakhs which according to the Management will be awarded fully in Company's favour on the basis of the contractual tenability, progress of arbitration and legal advice. Accordingly, no adjustment has been made in the Ind AS Standalone Financials Statements.

(b) We draw attention to Note No.8(c) of the standalone financial statements regarding claims made to clients amounting to Rs. 10664.53 lakhs (net of expected credit loss of Rs. 53.59 lakhs) which were based on the on the terms and conditions implicit in the Construction Contracts in respect of closed/suspended/under construction projects. These claims are mainly in respect of cost over run arising due to suspension of work, client caused delays, changes in the scope of work, deviation in design and other factors for which company is at various stages of negotiation/ discussion with the clients. On the basis of the contractual tenability, progress of negotiations/discussions.the management considers these receivables are recoverable. Accordingly.no further adjustment has been made in the Ind AS Standalone Financial Statements.

(c) We draw attention to Note No. 18.3 of the standalone financial statements regarding default committed by the Company in respect of repayment of Optionally Convertible Debentures as per the terms of approved S4A scheme and in respect of repayment of other restructured term loans.

Our opinion is not modified in respect of the above stated matters. Other Matters

The comparative financial information of the company for the year ended March 31, 2017 and the transition date opening balance sheet as at April 01, 2016 prepared in accordance with Ind AS included in these Standalone Ind AS financial statements, are based on the previously issued statutory standalone financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditor whose report for the year ended March 31, 2017 and March 31, 2016 dated May 30, 2017 and May 25, 2016 respectively expressed an unmodified opinion on those standalone financial statements, as adjusted for the differences in the accounting principles adopted by the company on transition to the Ind AS, which have been audited by us.

Our Opinion is not modified in respect of this matter. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2016 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we enclose in the "Annexure - A", a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) Inour opinion,proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, the Statement of Profit and Loss, the Cash Flow Statement and the Statement of changes in Equity dealt with in this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section133 of the Act.read with Rule 4of the Companies (Indian Accounting Standards) Rules, 2015;

(e) The matters described under "Emphasis of Matters" paragraph, in our opinion, may have an adverse effect on the functioning of the Company;

(f) On the basis of the written representations received from the directors as on March 31, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164(2)of the Act;

(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B";Our report expresses a qualified opinion on the adequacy and operating effectiveness of the Company's internal financial controls over financial reporting.

(h) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Notes to the standalone financial statements;

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

(iii)There has been a delay of one day in transferring amounts that were due to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31,2018.

Annexure 'A' Referred to in Paragraph 1 under the heading 'Report on Other Legal and Regulatory Requirements' of our report of even date to the members of the Company for the year ended March 31, 2018

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

(b)The fixed assets of the company have been physically verified by the management at periodic intervals, which in our opinion is reasonable. According to the information and explanations given to us.no material discrepancies have been noticed on such verification.

(c) According to the information and explanations given to us, the records examined by us and based on the examination of the conveyance deeds provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings which are freehold, are held in the name of the Company as at the balance sheet date.

(ii) The inventory has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable. As per the information and explanations given to us, no material discrepancies were noticed on physical verification of inventory.

ill. According to the information and explanations give to us and on the basis of our examination of records, the Company has granted unsecured interest free loans,to companies covered in the register maintained under section 189 of the Companies Act, 2013. In our opinion, the terms and conditions under which the loans were granted to subsidiaries were not prejudicial to the interest of the Company. In the absence of specific schedule for repayment, we could not comment on the regularity of repayment of loan.

iv. The Company has not granted any loans or provided any guarantees or security to the parties covered under section 185 of the Act. The Company, being engaged in the business of providing infrastructural facilities, Section 186 of the Act is not applicable in respect of loans given / guarantees provided to other body corporates to by virtue of exemption provided under sub-section (11) of the said section of the Act.

v. The Company has not accepted any deposits from the public to which the provisions of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under apply.

vi. The maintenance of cost records has been specified by the Central Government under Section 148(1) of the Companies Act, 2013 for the product produced by the Company. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under Sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company.in our opinion, the Company is not regular in depositing the undisputed statutory dues in respect of Provident funds, Income Tax sales- tax, value added tax, service tax, goods and service tax, cess and other material statutory dues, as applicable with the appropriate authorities. There have been significant delays in a large number of cases in depositing these dues with the appropriate authorities. Further, there were no undisputed amounts payable in respect of the statutory dues outstanding as on March 31, 2018 for a period of more than six months from the date they became payable except for the following:

b) According to the information and explanations given to us, there are no dues of sales tax, service tax, duty of customs, duty of excise, value added tax which have not been deposited with the appropriate authorities on account of any dispute except for the dues attached in Appendix 1 to this report.

viii. According to the information and explanations given to us, the company has defaulted in repayment of loans taken from banks and financial institutions as at the year-end, as per details attached in Appendix 2 to this report

ix. The Company has not raised any money by way of initial public offer or further public offer (including debt instruments) or term loans during the year.

x. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or no material fraud on the Company by its officers or employees has been noticed or reported during the year.

xi. According to the information and explanations given to us and based on examination of the records of the Company, the Company, during the year, has not provided any managerial remuneration.Accordingly, paragraph 3 (xi) of the Order is not applicable to the Company.

xii. In our opinion and according to the information and explanation given to us,the Company is not a Nidhi Company . Accordingly, paragraph 3 (xii) of the Order is not applicable to the Company.

xiii. In our opinion and according to the information and explanations given to us, the Company is in compliance with Section 177 and 188 of the Companies Act, 2013 where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the Ind AS standalone financial statements as required by the applicable accounting standards.

xiv. During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures. However, during the year the Company had made allotment of optionally convertible debentures (OCDs) to the lenders pursuant to the Scheme for Sustainable Structuring of Stressed Assets (S4A Scheme) adopted by the Joint Lenders' Forum as stated in Note 18.2 to the Standalone Ind AS Financial Statements. In respect of the same, in our opinion, the Company has complied with the provisions of Section 42 of the Act and rules framed thereunder. Further, it is to be noted that no amounts were raised from the allotments made during the year and that the outstanding loans along with accrued interest as on the reference date (as defined in the Master Restructuring Agreement), i.e. November 11 2016, had been converted into OCDs.

xv. In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its Directors or persons connected to its directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.

xvi. The Company is not required to be registered under section 45-lAof the Reserve Bank of India Act, 1934.

Annexure- A to the lndependent Auditors Report

Principal & Interest Delay days: 12.65% Non Convertible debentures

Principal & Interest Delay days: Working Capital Term Loan -1 (WCTL-I)

Principal & Interest Delay days: Working Capital Term Loan II (WCTL-II)

Principal & Interest Delay days: Funded Interest Term Loan I (FITL-I)

Principal & Interest Delay days: Funded Interest Term Loan II (FITL-II)

Principal & Interest Delay days: Corporate Term Loans

Principal & Interest Delay days: Priority Corporate Loans

Principal & Interest Delay days: Funded Interest Term Loan IV (FITL-IV)

Principal & Interest Delay days: Cash Credit (CC) (Short Term Borrowings)

Annexure 'B' Referred to in paragraph 2 (f) under the heading 'Report on other legal and regulatory requirements' of our report on even date on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act") to the members of the Company for the year ended March 31,2018

To the Members of Consolidated Construction Consortium Limited

We have audited the internal financial controls over financial reporting of Consolidated Construction Consortium Limited ("the Company"), as of March 31,2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management's Responsibility for lnternal Financial Controls

The Company's management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing as specified under section 143(10) of the Act to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness.Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. internal financial controls system over financial reporting. Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Basis for Qualified Opinion

In our opinion, according to the information and explanations given to us and based on our audit, the following material weaknesses have been identified as at March 31,2018:

The Company did not have appropriate internal financial controls over:

(a) Assessment of expected credit loss/loss allowance of unbilled revenue, trade receivables and withheld amounts which are subject matters of various disputes /arbitration proceedings/ negotiations with the customers and contractors due to termination /for eclosure of contracts and other disputes;

(b) Controls over projects costs estimation and review of balance costs to complete in respect of work projects;

(c) customer acceptance, credit evaluation and establishing customer credit limits for sales and customers in respect of variations in contract work which may probably result in the Company recognising revenue without establishing reasonable certainty of ultimate collection, on criteria based on or considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

A 'material weakness' is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis.

Qualified opinion

In our opinion, except for the possible effects of material weaknesses described in "basis of qualified opinion" paragraph above, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

We have considered the material weaknesses identified and reported above in determining the nature, timing and extent of audit tests applied in our audit of the standalone financial statements of the Company for the year ended March 31, 2018 and these material weaknesses have not affected our opinion on the standalone financial statements of the Company, however, we have drawn attention to certain matters in our report on the Ind AS standalone financial statements as discussed under the para Emphasis of Matters considering the weakness identified above.