Asian Hotels (West) Ltd

TO THE MEMBERS OF

(FORMERLY CHILLWINDS HOTELS LIMITED)

1. We have audited the attached Balance Sheet of Asian hotels (West) Limited(Formerly Chillwinds hotels Limited), as at 31 March, 2010, the Profit and LossAccount and the Cash Flow Statement of the Company for the year ended on that date,annexed thereto. These financial statements are the responsibility of the Company’sManagement. Our responsibility is to express an opinion on these financial statementsbased on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted inIndia. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatements. 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 the Management, as well as evaluating the believethat our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 as amended by theCompanies (Auditors’ Report) (Amendment) Order, 2004 (Collectively the Order) issuedby the Central Government of India in terms of sub-section (4A) of section 227 of theCompanies Act, 1956 and on the basis of such checks of the books and records of theCompany as we considered appropriate and according to the information and explanationsgiven to us we enclose in the Annexure a statement on the matters specified in paragraphs4 & 5 of the said Order.

4. 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 ourknowledge and belief, were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;

c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with bythis report are in agreement with the books of account;

d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statementdealt with by this report comply with the accounting standards referred to in sub-section(3C) of section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors, as on 31 March,2010, and taken on record by the Board of Directors, we report that none of the directorsis disqualified as on 31 March, 2010, from being appointed as a director in terms ofclause (g) of subsection (1) of section 274 of the Companies Act, 1956;

f) Without qualifying our opinion, attention is invited to Note 17 of Schedule 16,wherein the Company has applied to the Ministry of Corporate Affairs, Government of Indiaunder section 211(4) of the Companies Act, 1956 for getting exemption with regard todisclosures in respect of quantitative details of turnover, opening and closing stock,purchases, production and consumption of raw material. The final approval is awaitedpending which the said disclosures are not being furnished.

g) Without qualifying our opinion, we invite reference to Note 3 of schedule 16regarding treatment of excess of assets over liabilities, and consideration payable in theform of equity shares, as general reserves, has been carried out pursuant to the Scheme ofArrangement and Demerger sanctioned by the Hon’ble High Court of Delhi, New Delhi,implementation whereof is binding on the Company though strictly not in line withgenerally accepted accounting practices and the Accounting Standards issued by theInstitute of Chartered Accountants of India.

h) Read with the foregoing, in our opinion and to the best of our information andaccording to the explanations given to us, the said accounts read together with the Notesthereon give the information required by the Companies Act, 1956, in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India:

i. In the case of Balance Sheet, of the state of affairs of the Company as at 31 March,2010;

ii. In the case of Profit and Loss Account, of the profit of the Company for the yearended on that date; and

iii. In the case of Cash Flow Statement, of the cash flows of the Company for the yearended on that date.

(Referred to in paragraph 3 of our report of even date)

i. In respect of its fixed assets:

a. The Company has maintained proper records showing full particulars, includingquantitative details and situation of fixed assets.

b. The Company has fixed assets programme of physically verifying its in aphased manner designed to cover all assets, which in our opinion is reasonable havingregard to the size of the Company and the nature of its business. In accordance with thisprogramme, the Management had carried out a physical verification some of its fixed assetsduring the year and the discrepancies noted on such verification material and have beensuitably dealt with in the books.

c. No substantial part of the fixed assets was disposed off during the year

ii. In respect of its inventories:

a. As explained to us, all inventories have been physically verified during the year bythe Management at reasonable intervals.

b. In our opinion, the procedures of physical verification of inventories followed bythe Management are reasonable to the size of the Company and the nature of its business.

c. In our opinion, the Company has maintained proper inventory records. Thediscrepancies noticed between the physical stocks and book records were not material andthe same have been properly dealt with in the books of account.

iii. The Company has not granted or taken any loans, secured or unsecured, to or fromcompanies, firms or other parties listed in the register maintained under Section 301 ofthe Companies Act, 1956. Accordingly, the provisions of clause 4(iii) of the Order are notapplicable to the Company.

iv. In our opinion and according to the information and explanations given to us, thereis adequate internal control system commensurate with the size of the Company and thenature of its business for the purchase of inventory and fixed assets and for the sale ofgoods and services. Further, on the basis of our examination of the books and records ofthe Company, carried out in accordance with the generally accepted auditing practices inIndia, we have neither come across nor have we been informed of any instance of acontinuing failure to correct major weaknesses in the aforesaid internal control systems

v. Based on our examination of the books of account and related records and accordingto the information and explanations provided to us, there are no contracts or arrangementswith companies, firms or other parties which need to be listed in the register maintainedunder Section 301 of the Companies Act, 1956.

vi. In our opinion and according to the information and explanations given to us, theCompany has not accepted any deposits from the public, within the meaning of Sections 58Aand 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies(Acceptance of Deposits) Rules, 1975.

vii. In our opinion the Company has an adequate internal audit system commensurate withthe size of the Company and nature of its business.

viii. According to the information and explanations given to us, the Central Governmenthas not prescribed maintenance of cost records under clause (d) of sub-section (1) ofSection 209 of the Companies Act, 1956 for the Company’s activities. Hence, theprovisions of clause 4(viii) of the Order are not applicable to the Company.

ix. a. According to the records of the Company examined by us and the information andexplanations given to us, the Company has generally deposited its statutory dues includingEmployees Provident Fund, Employees’ State Insurance, Income Tax, Wealth Tax, ServiceTax, Custom Duty, Excise duty, Cess and any other material statutory dues within theprescribed time with the appropriate authorities during the year and there are noundisputed amounts payable in respect of these dues which have remained outstanding as at31 March, 2010 for a period of more than six months from the date they became payable.

b. We are informed that there are no dues in respect of Sales Tax, Income Tax, WealthTax, Customs Duty, Excise Duty, Service Tax and Cess which have not been deposited onaccount of any dispute.

x. Since the Company has been registered for less than five years, reporting onaccumulated losses at the end of the year and cash loss is not required.

xi. According to the information and explanations given to us and records of theCompany examined by us, the Company has not taken loans from financial institutions orbanks.

xii. According to the information and explanations given to us, the Company has notgranted loans and advances on the basis of security by the way of pledge of shares,debentures and other securities. Accordingly, the provisions of clause 4(xii) of the Orderare not applicable to the Company.

xiii. In our opinion and according to the information and explanations given to us, theCompany is not a chit fund or a nidhi/mutual benefit fund/ society. Accordingly,provisions of clause 4(xiii) of the Order are not applicable to the Company.

xiv. In our opinion and according to the information and explanations given to us, theCompany is maintaining proper records and making timely entries for all transactions andcontracts in shares and other investments. All shares have been held by the Company in itsown name.

xv. The Company has provided security, by way of pledge of its investments and paripassu charge on its immovable properties, to the lenders who have advanced loans to theSubsidiary Company. The terms and conditions of the security provided do not seen to be,prima facie, prejudicial to the interest of the Company owing to the Company’s longterm involvement with its Subsidiary Company.

xvi. The Company has not taken any term loans during the year.

vii. According to the information and explanations given to us, and on an overallexamination of the Balance Sheet of the Company, funds raised on short term basis haveprima facie, not been utilised for long term investment.

xviii. According to the information and explanations given to us, the Company has notmade any preferential allotment of shares to parties and companies covered in the registermaintained under Section 301 of the Companies Act, 1956.

xix. According to the information and explanations given to us, the Company has notissued any debentures nor has any outstanding debentures.

xx. According to the information and explanations given to us, the Company has notraised any money by way of public issues during the year.

xxi. During the course of our examination of the books and records of the companycarried out in accordance with the generally accepted auditing practices in India, we haveneither come across any instance of fraud on or by the company, noticed or reported duringthe year, nor we have been informed of such case by the management.