Basant Agro Tech (India) Ltd

Report of the Auditors to the Members of BASANT AGRO TECH (I) LIMITED on the financialstatements for the year ended 31st March, 2010.

1. We have audited the attached Balance Sheet of BASANT AGRO TECH (INDIA) LIMITED asat 31st March, 2010. the Profit and Loss Account and also the Cash Flow Statement for theyear ended on that date annexed thereto. These Financial Statements are the responsibilityof the Company's management Our responsibility is to express an opinion on these financialstatements based on our Audit

2. 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 from material misstatement Anaudit also includes examining on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management, as well as evaluating theoverall financial statement presentation. We believe that our audit provides a reasonablebasis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, issued by the CentralGovernment of India in terms of Sub-Section (4A) of Section 227of the Companies Act, 1956(herein after referred to as the "Act"), we enclose in the annexure a statementon the matters specified in paragraphs 4 & 5 of the said Order, to the extentapplicable.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we reportthat:

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 it 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 & 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 Act;

e) On the basis of the written representations received from the directors, and takenon record by the Board of Directors, we report that none of the directors is disqualifiedas on 31st March, 2010 from being appointed as a director in terms of clause (g) ofSub-Section (1) of Section 274 of the Act;

f) In our opinion and to the best of our information and according to the explanationsgiven to us, the said financial statements read together with Significant AccountingPolicies and notes thereon, in Schedule 19 to the financial statement give the informationrequired by the Act, in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India:

i. in the case of Balance Sheet, of the state of affairs of the Company as at 31stMarch, 2010,

ii. in the case of the Profit and Loss Account, of the Profit of the Company for theyear ended on that date; and

iii in the case of Cash Flow Statement, of the cash flows for the year ended on thatdate

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF AUDITORS' REPORT OF EVEN DATE ON THE FINANCIALSTATEMENTS AS AT & FOR THE YEAR ENDED 31ST MARCH, 2010 OF BASANT AGRO TECH (I) LTD.

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

b) The fixed assets have been physically verified by the management in accordance withthe phased program of verification adopted by the Company, in our opinion, the frequencyof verification is reasonable having regard to the size of the Company and nature of fixedassets. No material discrepancies have been noticed in respect of the assets physicallyverified during the year

c) No substantial part of the fixed assets has been disposed off during the year

2. a) The inventory has been physically verified by the management at reasonableintervals during the year Inventory lying with third parties and in-transit have beenverified with reference to confirmations and subsequent receipt of the goods

b) The procedures of physical verification of inventories followed by the managementare reasonable and adequate in relation to the size of the Company and nature of itsbusiness

c) The Company is maintaining proper records of inventory. The discrepancies noticed onphysical verification of inventory as compared to book records were not material and havebeen properly dealt with in the books of account.

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

b) The Company has taken unsecured loans from 11 parties covered in register maintainedunder Section 301 of Act. The maximum amount involved during the year and the year-endbalance of such loans aggregated to Rs. 1004.52 Lacs There were no stipulation as to whenthe repayment has to be made or when the Interest was payable, whereever applicable. Inour opinion, the rate of interest and other terms and conditions of such loans are primefacie not prejudicial to the interest of the Company.

4. In our opinion and according to the information and explanations given to us havingregard to the explanation that some of the items purchased are of special nature andsuitable alternative sources do not exist for obtaining comparable quotations, there areadequate internal control system commensurate with size of the Company and the nature ofits business for purchase of inventory and fixed assets and for the sale of goods Duringthe course of our audit, no major weakness has been noticed in the internal controlsystem.

5. a) According to the information and explanations given to us, we are of the opinionthat the particulars of contracts and arrangements referred to in Section 301 of the Acthave been entered in the register required to be maintained under that Section.

b) In our opinion, having regard to our comments in para IV above and according to theinformation and explanations given to us, the transactions made in pursuance to contractsor arrangements entered in the register maintained under Section 301 of the Act andaggregating during the year to Rs. 5,00,000 or more in respect of each party, have beenmade at prices which are reasonable having regard to prevailing market prices at therelevant time.

6. The Company has not accepted any deposits within the meaning of the Section 58A,58AA or any other relevant provisions of the Act and rules framed thereunder.

7. In our opinion, the Company has an internal audit system commensurate with the sizeof the Company and the nature of its business.

8. We have broadly reviewed the cost records of the Company in respect of productsmaintained pursuant to the Order of the Central Government under Section 209 (1) (d) ofthe Act and are of the opinion that, prima facie, the prescribed records have been madeand maintained. We are, however, not required to make a detailed examination of therecords with a view to determine whether they are accurate or complete.

9 a) The Company is generally regular in depositing the undisputed statutory duesincluding Provident Fund. Investor Education and Protection Fund, Employees' StateInsurance, Income tax, Sales tax, Custom Duty, Excise Duty, Service Tax Cess and othermaterial statutory dues applicable to it with the appropriate authorities According to theinformation and explanations given to us, there are no undisputed statutory duesoutstanding as at 31st March, 2010 for a period of more than six months from the date theybecame payable.

b) According to the records of the Company & information and explanations given tous by the management, there are no dues of Income Tax, Sales Tax, Service Tax. CustomsDuty, Wealth Tax, Excise Duty, Cess which have not been deposited on account of anydispute

10. The Company does not have accumulated losses as at 31st March, 2010 and has notincurred cash losses in the financial year ended on that date and in the immediatelypreceding financial year

11. Company has not defaulted in repayment of dues to financial institutions or banks.

12. During the year, the Company has not granted any loans and advances on the basis ofsecurity by way of pledge of shares, debentures and other securities.

13. According to the information & explanation given to us, in our opinion, theterm loans were applied for the purpose for which they were obtained.

14. According to the information & explanation given to us, the Company has notgiven any guarantee for the loan taken by others from Banks & financial institutions.

15. Based on the information and explanations given to us and on an overall examinationof the Balance Sheet of the Company, in our opinion, there are no funds raised on a shortterm basis which have been used for long term investment.

16. During the year, no fraud on or by the company has been noticed or reported duringthe course of our audit.