Adi Rasayan Ltd

To

The Members of ADI RASAYAN LIMITED

A. We have audited the attached Balance Sheet of M/S. ADI RASAYAN LIMITED, as at31^st March, 2011 and Profit & Loss Account for the year ended on that dateannexed thereto.

These financial statements are the responsibility of the Company’s management. Ourresponsibility is to express an opinion on these financial statements based on our audit.

B. We have conducted our audit in accordance with auditing standards generally acceptedin India. Those Standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the accounting principlesused and significant estimates made by management, as well as evaluating the overallpresentation of the financial statement. We believe that our audit provides a reasonablebasis for our opinion.

C. As required by the Companies (Auditor’s Report) Order, 2003 issued by theCentral Government of India in terms of section 227(4A) of the Companies Act, 1956, wegive in the Annexure, a statement on the matters specified in paragraphs 4 of the saidorder.

D. Further to our comments in the Annexure referred to in paragraph C above, we reportthat:

1. We have obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit.

2. In our opinion, proper books of accounts as required by law have been kept by theCompany, so far as appears from our examination of the books.

3. The Balance Sheet and Profit & Loss Account dealt with by this report are inagreement with the books of account.

4. in our opinion, the Balance Sheet and Profit & Loss Account dealt with by thisreport comply with the accounting standards referred to in sub-section (3C) of section 211of the Companies Act, 1956.

5. On the basis of representations from the directors, taken on record by the Board ofDirectors and as per information and explanations given to us, none of the directors ofthe company are, prima facie, as at 31st March, 2010, disqualified from being appointed asdirectors of the company in terms of clause (g) of sub-section (1) of Section 274 of theCompanies Act,1956.

6. In our opinion and to the best of our information and according to the explanationsgiven to us, the accounts read with and subject to notes thereon of Schedule-5 give theinformation required by the Companies Act, 1956 in the manner so required and give a trueand fair view:

(i) In the case of Balance sheet, of the state of affairs of the company as at 31stMarch, 2011 and

(ii) In the case of profit & Loss Account of the loss for the year ended on thatdate.

ANNEXURE TO THE AUDITORS’ REPORT

(Re: ADI RASAYAN LIMITED)

(Referred to in paragraph : C of our report of even date)

1. The company does not have any fixed assets and hence this clause is not applicableto the company for the year under consideration.

2. As the company does not have any inventories as at the end or at the beginning ofthe year; this clause is not applicable to the company for the year under consideration.

3. (a) The company has not granted unsecured loan to any of the parties covered bysection 301 of the Companies Act, 1956.

(b) The company has not taken any loans from companies, firms or other parties coveredin 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, thereare adequate internal control procedures commensurate with the size of the company and thenature of its business with regard to purchase of inventory and fixed assets and for saleof goods and services. In our opinion, there is no continuing failure to correct majorweakness in internal control.

5. To the best our knowledge and belief, and according to the information andexplanations given to us, we are of the opinion that there are no contracts andarrangements, the particulars of which need to be entered into the register maintainedunder Section 301 of the Companies Act,1956.

6. During the year, the company has not accepted deposits from the public.

7. The Company did not have any formal internal audit system during the year underreview.

8. We are informed that maintenance of cost records has not been prescribed by theCentral Government under Section 209 (1)(d) of the Companies Act, 1956 in respect ofproducts of the company.

9. (a) According to the books of accounts examined by us and also based onrepresentations received from the management, the company is regular in depositingundisputed statutory dues applicable to it. There is no Undisputed amounts payable inarrears in respect of statutory dues as at 31/03/2011 for a period of six months from thedate they become payable.

(b) According to the information and explanations given to us, there are no dues inrespect of income tax, sales tax, wealth tax, excise duty, service tax and cess which havenot been deposited on account of dispute.

10. The company’s accumulated losses at the end of the financial year are morethan fifty percent of its net worth and the company has incurred cash losses in suchfinancial year and in the immediately preceding financial year also.

11. Based on our audit procedures and according to the information and explanationsgiven to us we report that the company had not defaulted in repayment of any secured loansduring the year under review.

12. According to the information and explanations given to us, the company has notgranted loans and advances on the basis of security by way of pledge of shares, debenturesand other securities.

13. The company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore,the provisions of clause 4(xiii) of the Order are not applicable to the company.

14. In our opinion and according to the information and explanations given to us, thecompany is not dealing in shares, securities and debentures; therefore, the provisions ofclause 4 (xiv) of the Order are not applicable to the company.

15 The company has not given guarantee to a bank for loan taken by any other company.

16. The company has not obtained any term loan during the year. Accordingly, theprovisions of clause (xvi) of the Order are not applicable to the company.

17. According to the information and explanations given to us and on an overallexamination of the balance sheet of the company, we report that no funds raised onshort-term basis have been used to finance long-term investments.

18. According to the information and explanations given to us, during the year coveredby our report, the company has not made any preferential allotment of shares to theparties and companies covered in the register maintained under section 301 of theCompanies Act, 1956.Accordingly, the provisions of clause (xviii) of the Order are notapplicable to the company.

19. According to the information and explanations given to us, the company has notissued any secured debentures during the period covered by our report. Accordingly, theprovisions of clause (xix) of the Order are not applicable to the company.

20. During the period covered by our audit report, the company has not raised any moneyby way of a public issue.

21. To the best of our knowledge and belief and according to the information andexplanations given to us, no fraud on or by the company was noticed or reported during theyear.