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 referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated September 13, 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 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 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 suffcient 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 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 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") as amended, 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 In terms of Non-Banking Financial Companies Auditor's Report (Reserve Bank) Directions, 2008 issued by Reserve Bank of India (RBI), we report that,

a) the Certifcate of Registration is cancelled by Reserve Bank of India on October 9, 2002.

b) the Company has not obtained credit rating.

c) the Company has repaid the deposits/ debentures; interest and/or principal amount of deposits/debentures in terms of the scheme of arrangement sanctioned by the Hon'ble High Court of Karnataka except to the extent of public liabilities which remains unclaimed by instrument holders including cheques issued but not encashed by the instrument holders.

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

d) 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 read with the General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and 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 Director 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 TO ThE INDEPENDENT AUDITORS' REPORT

In terms of the Annexure referred to in our report to the members of ICDS Limited ('the Company') for the year ended March 31, 2014 in Paragraph 1 of Report on Other Legal and Regulatory Requirements, we report that :

i) a) The company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets on the basis of available information.

b) All the fixed assets of the Company other than those under lease have been physically verifed by the management during the year. In our opinion, the frequency of such verifcation is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, no discrepancies were noticed on such verifcation.

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

ii) a) The inventory held by the Company has been physically verifed by the management at the year end. In our opinion, the frequency of such verifcation is reasonable.

b) In our opinion, the procedures of physical verifcation of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verifcation of inventory as compared to book records were not material.

iii) a) As per the information and explanation given to us, during the year, the Company has granted interest free unsecured loans aggregating to Rs. 5,200 thousands to one Company listed in the register maintained under Section 301 of the Act. The maximum balance outstanding at any time during the year is Rs.3,500 thousands and balance at the year end is Rs. Nil. b) As per the information and explanation given to us, the terms and condition of loans given by the Company are prima-facie not prejudicial to the interest of the Company.

c) The question of default in repayment of principal amount does not arise as the loan is repaid during the year.

d) As per the information and explanations given to us, the Company has not taken any loans, secured or unsecured, from Companies, Firms or other parties listed in the Register maintained under Section 301 of the Act. Consequently requirement of clause (iii) (e) to (g) of paragraph 4 of the Order are not applicable to the Company.

iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for purchase of inventory, fixed assets and for sale of goods and services.

Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

v) a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the particulars of contracts and 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 registers maintained under Section 301 of the Act in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant date.

vi) The Company's liabilities (including public deposits along with interest accrued thereon) were restructured as per the Scheme of Arrangement sanctioned by the Hon'ble High Court of Karnataka vide its Order dated October 15, 2004. Accordingly the Company has repaid its public liabilities. We are informed by the management of the Company that there are no other orders by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

vii) In our opinion, the Company's Internal audit is commensurate with its size and nature of its business.

viii) The Central Government has not prescribed maintenance of cost records u/s 209(1)(d) of the Act for the Company.

ix) a) According to the information and explanations given to us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other statutory dues applicable to it except in case of an amount of Rs. 93,07 thousands which was outstanding for more than 6 months as on the date of balance sheet to be remitted to Investor Education and Protection Fund (IEPF) as referred to in Note nos. 2.06(a) and 2.06(b) of the Financial Statement.

b) According to the records of the Company, there are no dues of income tax, wealth tax, sales tax, customs duty and excise duty/ cess other material statutory dues which have not been deposited on account of any dispute except the following:-

                                           Years to which it 
Name of the Statute       Nature of Dues   pertains

Income Tax Act, 1961      Disallowance of  Block assessment
                          depreciation on  year 1991-92 to
                          leased assets    1996-97

Name of the Statute   Amount             Forum where dispute
                     (Rs. in 000's)      is pending

Income Tax Act 1961                      Special Leave Petition 
                          53,069 *       before Hon'ble Supreme
                                         Court of India

*net of amount paid under protest Rs.49,335 thousands.

x) The Company's accumulated losses as at March 31, 2014 is not more than fifty percent of its net worth and it has not incurred cash losses in the financial year ended on that date and in the immediately preceding financial year.

xi) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution / banks. In respect of matured debentures and interest accrued thereon upto July 15, 2002, the Company has repaid all the installments to debenture holders as per the Scheme of Arrangement as sanctioned by the Hon'ble High Court of Karnataka on October 15, 2004.

xii) In our opinion the Company has maintained adequate documents and records where the Company has 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, clause 4(xiii) of the Order as amended is not applicable to the Company.

xiv) The Company has maintained proper records for transactions and contracts in respect of trading in shares and other investments and timely entries have been made in those records.

xv) As per information and explanations given to us, the Company has not given any guarantees to Banks or Financial Institutions for loan taken by others.

xvi) The Company has not taken any term loans from banks or financial institutions during the year.

xvii) According to the information and explanations given to us, and on overall examination of the Balance Sheet of the Company, we are of the opinion that, the funds raised on a short-term basis of Rs. 12,205 thousands have been used for long term purpose.

xviii) During the year Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

xix) In our opinion and according to the information and explanations given to us, the Company has not issued any secured debentures during the period covered under our report. Accordingly, provisions of clause 4(xix) of the Order are not applicable to the Company.

xx) The Company has not raised any money by public issue during the year.

xxi) During the course of examination of Books of Account and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any fraud on or by the Company, noticed or reported during the year, nor have been informed of such case by the Management.

                                     For CHATURVEDI & SHAH
                                     Chartered Accountants
                                     Firm Registration No.: 101720W

                                                 Sd/-
                                              C. D. Lala
Place : Mumbai                                Partner
Date : May 30, 2014                     Membership No.: 35671