MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

The Company's 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 read with the General Circular 15/2013 dated 13thSeptember, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. This responsibility includes 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

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 Company'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 audit opinion.

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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 of the Company for the year ended on that date; and

(c) In the case of Cash Flow Statement, of the cash flow for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. This report does not include a statement on the matters specified in paragraph 4 of the Companies (Auditor's Report) Order, 2003issued by the Central Government of India in terms of Section 227(4A) of the Act;since in our opinion and according to the information and explanation given to us, the said order is not applicable to the company.

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 purpose 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, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with Accounting Standards notified under the Act; read with the General Circular 15/2013 dated 13thSeptember, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013.

(e) On the basis of the written representations received from the directors as on March 31,2014, 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 Section 274(1 )(g) of the Act.

ANNEXURE TO THE PART OF THE AUDITORS REPORT

(This is annexure referred to in our Report of even date)

In terms of information and explanations given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state as under:

The company has maintained proper records showing full particulars including quantitative details and situation of its Fixed Assets. These Fixed Assets were physically verified by the management during the year. We have been informed that no material discrepancies were noticed on such verification.

None of the Fixed Assets have been revalued during the year.

The stock of the inventory (Raw materials, Components, Stores & Spare Parts, Work-in-process, Finished Goods etc.) have been physically verified by the management during the year at reasonable intervals except stock lying with third parties, it is stated to us that confirmation of such stocks lying with parties have been obtained by the company in most of the cases. In our opinion the procedure of physical verification of inventory followed by the Management is reasonable and adequate in relation to the size of the company and its nature of business. The company is maintaining proper records of inventory.

The discrepancies noticed on physical verification between physical stock and book records which were of not material value have been properly dealt with in the Books of account.

In our opinion there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods.

The Central Government has not prescribed the maintenance of Cost records by the company U/S 209(1 )(d) of the Companies Act-1956 for any of its products.

In case of transaction of purchase of goods and materials and services and sale of goods and materials exceeding the vaiue of Rupees Five Lacs in the financial year in respect of any;

a) Transaction that to be entered into a register in pursuant of section 301 of the Act have been so entered.

b) In our opinion, each of these transactions have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

The company has not accepted any deposits from the public. In our opinion the directive issued by the Reserve Bank of India and the provision of the section 58Aand 58AAof the Act and the rules framed thereunder, where applicable, have been complied with. National Company Law Tribunal or any other Court has not passed any order in this respect.

In our opinion reasonable records have been maintained by the Company for the sale and disposal of realisable scraps. The Company has no by-products.

The Company is depositing the Provident Fund and employees' State Insurance dues with the appropriate authority.

According to the information and explanation given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Excise Duty were outstanding as at 31.03.2014 for a period of more than six months from the date they become payable (Except as mentioned in Notes on Accounts).

According to the information and explanations given to us, no personal expenses of Directors or employees have been charged to Profit & Loss Account, other than those payable under contractual obligations or in accordance with generally accepted business practice.

The Company has accumulated losses and incurred loss in the financial year to under review and has cash losses in the financial year immediately preceding the said financial year.

The Company has invested in shares as disclosed in respective schedule.

The Company has not given any guarantee for loans taken by others from banks or financial institutions.

The Company is a sick industrial unit within the meaning of clause (o) of sub Section (1) of Section 3 of the Sick Industrial Companies (Special Provision) Act, 1985. The Board for Industrial & Financial Reconstruction (BIFR) had also declared the Company as a sick industrial unit.

The Company is a recognized R&D Centre of the Govt, of India under its recognition letter of ministry science and technology.

In respect of trading items, according to the information and explanations given to us, there were no damaged goods during the year.

The Company is not a Chit Fund, Nidhi, or Mutual benefit fund/Society.

During the checks carried out by us, any fraud on or by the company has not been noticed or reported during the year under report.

                                               For B. R. KHAITAN & CO.
                                                 Chartered Accountants

                                                            P. KHAITAN
                                                            Proprietor

Place : Kolkata                                 Membership  No. 060367
Date  : 13th May, 2014                               Regn. No. 305012E