2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2002 issued by the Central Government of India in terms of sub-section 227 of the Companies Act, 1956, we enclose in the annexure (1) a statement on the matters specified in paragraph 4 and 5 of the said order.

Further to our comments in the annexure referred to above, 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 purposes 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 accounts;

(c) The Balance Sheet dealt with by this report are in agreement with the books of accounts;

(d) In our opinion, the Balance Sheet of the company comply with the Accounting Standards as referred in Sub-Section (3C) of Section 211 of the Companies Act, 1956, to the extent applicable:

(e) As per information and explanations given to us, none of the directors of the company are disqualified from being appointed as a director under clause (g) of Sub-Section (1) of Section 274 of the Companies Act, 1956;

(f) In our opinion and to the best of our information and according to explanations given to us, said accounts, read together with Significant Accounting Policies and Notes forming part of Accounts, give the information required by the Companies Act, 1956 in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India,

(i) in case of Balance Sheet, of the state of the affairs of the company as at 31st March 2013;and

(ii) in case of Profit and Loss Account, of the Loss of the Company for the year ended on that date.

ANNEXURE

STATEMENT REFERRED TO IN PARAGRAHPH ABOVE OF OUR REPORT OF EVEN DATE

1. As informed by the company it does not have any fixed assets and clause 4(ii) a to 4(ii) c of the companies order 2003 are not applicable.

2. As informed by the company it does not have any inventory and such clause 4(ii) a to 4(ii) c of the companies order 2003 are not applicable.

3. We are informed that the company has not taken/ granted any loans, secured or unsecured from companies firms or other parties listed in the register maintained under section 301 of the companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of the business for the purchase of inventory and fixed assets and for the sale of goods. In our opinion and according to the information and explanations given to us there is no continuing failure to correct major weaknesses in internal control.

5. As explained to us, there has not been any transaction during the year that needs to be entered in the register maintained under section 301 of the companies Act, 1956 and exceeding the monetary limits during the Near in respect of each such party.

6. The company has not accepted any deposits from the public under Section 58A of the Companies Ad. 1956.

7. The company has no formal Audit Department as such except the Audit Committee. However its control procedure ensures reasonable internal checking of its financial and other records.

8. As per information the company is not required to maintained cost records as prescribed by the central Government u/s 209( 1) (d) of companies Act, 1956.

9. According to the records of the company the dues of sales tax, income tax, customs, wealth tax. excise duty less which has not been deposited on account of disputes is pending are as under:-

10. The company has been incurring losses since its commercial production in the year 1996. The assets of the company had however been taken over by U.P.F.C, the financial institution u/s 29 SFC Act, in 1998. The company has however accumulated losses to the tune of Rs.3,48,36,959/- for the financial year 2012- 2013 which is more than 50% of its net worth.

1 1. The company has not granted loans and advances on the loss of security by way of pledge of shares debentures and securities.

12. The company is not a chit fund, nidhi, mutual receipt / society therefore the provisions of clause 4(xii) of the Companies (Auditors Report) Order, 2003 are not applicable.

13. In our opinion the company is not dealing or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4 (xii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

14. The company has not given any guarantee for loans taken by others from banks or financial institution.

15. The company has not raised short term temporary loans during the year.

16. The company has not made any preferential allotment of shares during the year.

17. The company has not issued any debentures during the year.

18. The company has not raised any money from the public during the year.

19. According to the information and explanations given to us, no fraud on or by the company has been noticed during the year.

                                      For Gupta Jalan & Associates 

                                      Chartered Accountants

                                      Inder Mohan Singh

                                      Partner

                                      M. No. 087877

Place: 31/08/2013