Management's Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true &fair view of the financial position, financial performance and cash flows of the company in accordance with the Accounting standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 ("the Act") 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 & 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 have conducted our audit in accordance with Auditing Standards issued by ICAI. 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 of material misstatement. An audit involves performing procedures to obtain evidence about the amounts and disclosure in the financial statements. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the management, as well as evaluating the overall presentation of the financial statement. We believe that audit evidence we have obtained is sufficient and appropriate to provide a basis four our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects 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 give a true &fair view in conformity with accounting principles generally accepted in India

(i) In the case of the Balance Sheet, of the state of affairs of the Company as on 31st March, 20C14;

(ii) In the case of the Profit and Loss Account, of the loss of the Company for the year ended on that date and;

(iii) In the case of Cash Flow Statement of the cash flows for the year ended as on that date.

Emphasis of Matter We draw attention to

(a) NOTE NO. 19(v) regarding Company having no whole time Company Secretary.

(b) NOTE NO. 19(vii) regarding non-ascertainment as well as non-provision of retirement benefits such as gratuity and leave encashment as required by accounting standard (AS 15) issued by the Institute of Chartered Accountants of India.

(c) NOTE NO. 19(ix) regarding non-ascertainment of impaired assets as required by accounting standard (AS 28) issued by the Institute of Chartered Accountants of India.

(d) NOTE NO. 19(xii) The concept of going concern is affected due to temporary suspension of mining activities of company with effect from 07/01/2014.

Report on Other Legal and Regulatory requirements

1. As required the companies (Auditors Report) Order 2003 ("the Order") issued by the Central Government in terms of Section 227 (4A) of the Act, we 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, we report that:

a) We have obtained all the information and explanations, which to the best of our knowledge & belief were necessary for the purpose of our audit.

b) 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 the Books of the Company.

c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement referred to in this report are in agreement with the Books of Accounts.

d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standard referred to in sub- section (3C) of section 211 of Companies Act, 1956.

e) on the basis of written representation received from the Directors as on 31.03.2014 and taken on record by the Board of directors of the Company, none of the Directors are disqualified as on 31.03.2014 from being appointed as director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDIT REPORT

(REFERRED TO IN PARAGRAPHS 1 OF OUR REPORT OF EVEN DATE ON ACCOUNTS FOR THE YEAR ENDED ON 31.3.2014)

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

(b) We are informed that all the major assets have been physically verified by the management during the year No material discrepancies were noticed on such verification of Fixed Assets during the year

(c) In our opinion, no substantial part of the fixed assets has been disposed off during the year

(ii) (a) According to information and explanations given to us, the Company has conducted physical verification of inventories at reasonable intervals.

(b) According to information and explanations given to us, the procedure of physical verification of inventories carried on by the management appears to be reasonable and adequate in relation to its size and nature of its business.

(c) According to information and explanations given to us, the company is maintaining proper records of inventory; no material discrepancies were noticed between physical verification of stock as compared to book records.

(iii) (a) The Company has not granted any loans secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(b) According to the information and explanation given to us, the company has not granted any loans, secured or unsecured to companies firms or other parties. Therefore, the provisions of clause iii (b) of paragraph (4) of the order are not applicable.

(c) According to the information and explanation given to us, the company has not granted any loans. Therefore provisions of clause iii (c) of the paragraph (4) of the order are not applicable.

(d) According to the information and explanation given to us the company has not granted any loan. Therefore provisions of clause iii (d) of the paragraph (4) of the order are not applicable.

(e) The Company has taken unsecured loan from companies, firms or other parties covered in the register maintained under section 301 of the Act, where the directors are interested.

(f) In our opinion, the rate of interest and other terms and conditions on which loan has been taken from the party listed in the Register maintained under section 301 of the Act are not prima facie prejudicial to the interest of the Company.

(g) In our opinion, payment of principal amount and interest are regular There is no overdue amount of loans/interest on loan taken.

(iv) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and nature of its business with regard to purchase of inventories stores, spare parts, components, fixed assets including plant & machinery, equipment and other assets and with regards to sale of goods. There is no continuing failure to correct major weakness in internal control of the Company.

(v) (a) According to the information and explanations given to us, transactions that need to be entered into the register maintained under Section 301 of the Act has been entered.

(b) In our opinion and according to explanation given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5,00,000/- in respect of each party during the year are either have been made at prices which are reasonable having regard to prevailing market prices at the relevant time or the prices at which transactions for similar goods or services have been made with other parties or as compared to the prices quoted by others, or such comparisons could not be made since there are no other suppliers of similar items.

(vi) In our opinion and according to information and explanation given to us, the Company has not accepted any deposit from public u/s. 58 A & 58 AA of the Companies Act, 1956 except paid under contractual arrangement.

(vii) The Company has an internal audit system commensurate with the size of the Company and nature of its business.

(viii) According to information and explanations given to us by the management, the Central Govt, has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, for the products of the Company.

(ix) (a) According to the information and explanation given to us, no undisputed amount shown as payable in respect of items specified in clause ix (a) Income Tax, Wealth Tax, Gujarat Sales Tax, Custom Duty, Royalty, Excise Duty, Cess as were outstanding as on 31 st March, 2014 for a period more than 6 months from the date they become payable.

(b) According to the information and explanation given to us, in case of Wealth Tax, Sales Tax, Excise/Custom Duty, Cess, there is no dispute.

However there is a dispute over payment of royalty amount of Rs.2, 80, 90,656/- (interest & penalty) included to the collector of Kucth-Bhuj. The company has disputed demand before the competent Authority. In case of Income tax, the company has paid Rs 1, 50,000 against demand of Rs. 3,36,000 for A.Y 2007-2008 under dispute. The Company has preferred appeal against the decision of ITO.

(x) The accumulated losses at the end of financial year 2013-2014 are more than 50% of Company's net worth. The Company has not incurred cash losses during the period covered by the report and in the financial year immediately preceding such financial year The Company is not a sick industrial company within the meaning of clause (o) of sub section (1) of section (3) of the Sick Industrial Companies (special provision) Act, 1985.

(xi) According to explanation 8i information given to us by the management, the company has not defaulted in repayment of dues to financial institution and banks.

(xii) According to information & explanation given to us, the Company has not granted any loans & advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a chit fund or a nidhi/mutual benefit fund/ society. Therefore the provision of clause (xiii)paragraph (4) of the order are not applicable.

(xiv) The Company is not dealing in or trading in shares, Securities, debentures and other investment. Therefore the provisions of clause (xiv) of the Paragraph 4 of the order are not applicable.

(xv) According to information & explanation given to us, the Company has not given any guarantee for loans taken by other from bank or financial institutions.

(xvi) The Company has not obtained any new ter, loans from the banks and financial insitutions during the year.

(xvii) According to the information & explanation given to us, during the year the Company has npt made any preferential allotment of shares to partied and companies and companies covered in the register maintained under Section 301 of the Companies Act, 1956

(xix) According to the information & explanation given to us, the Company had not issued any secured debentures during the year.

(XX) The Company has not raised any money by public issue during the year

(xxi) According to the information and explanation given to us, no fraud on or by the Company has been noticed or reported during the year.

                                              For M. G. SIMARIA & CO.
                                                Chartered Accountants

                                          Manilal G. Simaria
                                            Proprietor
                                        Membership No. 31547
Place : Mumbai                         Firm Registration No. 110260W
Date : 30th May, 2014