RLF Ltd

To the Member of RLF Limited. New Delhi.

1. We have audited the attached Balance Sheet of M/s RLF Limited as at 31st March 2010and also the Profit & Loss Account and the Cash Flow Statement of the Company 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 thesefinancial statements based 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 misstatement. Anaudit includes examining on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit includes assessing the accounting principles usedand significant estimates made by management, as well as evaluating the overall financialstatement presentation. We believe that our audit provides a reasonable basis for ouropinion.

3. As required by the Companies (Auditor's Report) Order, 2003, as amended by theCompanies(Auditor's Report) (Amendment) Order, 2004 issued by the Central Government ofIndia in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclosein the annexure a statement on the matters specified in paragraphs 4 and 5 of the saidOrder.

4. Further to our comments in the Annexure referred to in paragraph (3) above, wereport that:

i. We have obtained all the information and explanations, which to the. best of ourknowledge and belief were necessary for the purpose of our audit;

ii. 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 book;

iii. The Balance Sheet, the Profit and Loss Account and the Cash Flow Statement, dealtwith by this report are in agreement with the books of account;

iv. In our opinion, the Balance Sheet, the Profit and Loss Account and the Cash FlowStatement, dealt with by this report comply with the Accounting Standards, referred to insub-section (3C) of Section 211 of the Companies Act, 1956 except requirements ofAccounting Standard 15 on Employee Benefits (Refer Accounting Policy No.-7);

v. On the basis of written representations received from the directors, as on 31stMarch, 2010, and taken on record by the Board of Directors, we report the none ofdirectors is disqualified from being appointed as a director in terms of clause (g) ofsub-section (I) of Section 274 of the Companies Act 1956;

vi. In our opinion and to the best of our information and according to the explanationsgiven to us, the said Accounts read with Significant Accounting Policies and Notesthereon, subject to requirements of Accounting Standard 15 on Employee Benefits (ReferAccounting Policy No.-7); give the information required by the Companies Act, 1956, in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:-

a. In the case of the Balance Sheet, of the State of Affairs of the Company as at 31stMarch,2010;

b. In the case of the Profit and Loss Account, of the Profit for the year ended on thatdate; and

c. In the case of Cash flow statement, the Cash inflows of the company for the yearended on that date.

1. In respect of fixed assets of the Company: -

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

b. The fixed assets have been physically verified by the management at reasonableintervals and no material discrepancy has been noticed on such verification.

c. No substantial part of the Fixed Assets has been disposed off during the year, whichhas a bearing on the Going Concern assumption.

2. In respect of inventories of the Company: -

a. Inventories were physically verified during the year by the management at reasonableintervals.

b. In our opinion, the procedures of physical verification of inventory followed by themanagement are reasonable and adequate, in relation to the size of the company and thenature of its business.

c. The company is maintaining proper records of inventory. There were no materialdiscrepancies noticed on physical verification of inventory.

3. During the year, the company has not granted any loans secured or secured orunsecured to /from companies, firms or other parties covered in the Register maintainedunder section 301 of the Companies Act, 1956. Further the Company had taken loan from twoparties during the year and the amount of which outstanding as on 31 March 2010 was Rs.10.15 Lac. The rate of interest and other terms and conditions of the loan taken, areprima facie not prejudicial to the interest of the company.

4. In our opinion and according to the information and explanation given to us, thereare adequate internal control procedures, commensurate with the size of the company andthe nature of its business, for the purchase of inventory and fixed assets and for thesale of goods and services. During the course of our audit no major weakness has beennoticed in the internal control system.

5. The particulars of contracts or arrangements that are needed to be entered into theregister maintained under section 301 of the Companies Act 1956 have been so entered andthese transactions prima-facie have been made at prices which are reasonable having regardto the prevailing market price.

6. In our opinion and according to the information and explanations given to us, thecompany has complied with the direction issued by the Reserve Bank of India and theprovision of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956and the Companies (Acceptance of Deposit) Rules 1975 with regard to deposit accepted fromthe public.

7. The internal audit of the Company has been conducted by its own internal staff andin our opinion, the company has an internal audit system, commensurate with the size andnature of its business.

8. The Central Government has not prescribed the maintenance of cost records by theCompany under Section 209 (I)(d) of the Companies Act, 1956, therefore the provision ofclause 4 (viii) of the Companies (Auditor's Report) Order, 2003 is not applicable to thecompany.

9. a) According to the records of the Company, it is generally regular in depositingwith appropriate authorities undisputed statutory dues including provident fund, investoreducation and protection fund, employees state insurance. income tax, sales tax, wealthtax, custom duty, excise duty, cess and other applicable statutory dues.

b) According to the information and explanations given to us, there is no undisputedamount payable in respect of income tax, wealth tax, sales tax, custom duty, excise dutyand cess as at the year end; for a period more than six months from the date they becamepayable.

c) According to the information and explanation given to us, there are no dues ofcustom duty, wealth tax and cess, which have been deposited on account of any disputeexcept Sales Tax demand of Rs 31.49 Lacs against which the company has gone into Appeal.

10. The Company has no accumulated losses at the end of the financial year and it hasnot incurred cash losses in the current and immediately preceding financial year.

11. The Company has not defaulted in repayment of dues to Financial Institution andBanks. Further the Company does not have any outstanding debentures.

12. The company has not granted any loans and advances, on the basis of security by wayof pledge of shares, debentures and other securities, during the year.

13. The Company is not a chit fund, nidhi or mutual benefit fund/society. Therefore theprovisions of clause 4 (xiii) of the Companies (Auditor's Report) order,2003 are notapplicable to the Company.

14. The Company has maintained proper records of transactions and contracts in respectof dealing in shares and other investments and that timely entry have been made therein.All shares and other investments have been held by the Company in its own name.

15. According to the information and explanation given to us, the Company has not givenany guarantee during the year, for loans taken by others from Banks or other FinancialInstitutions.

16. In our opinion, and according to the information and explanations given to us, onan overall basis, the term loans have been applied for the purposes for which they wereobtained.

17. According to the information and explanation given to us and on overall examinationof the Balance Sheet of the Company, we report that the funds raised on short-term basishave not been used for long-term investment.

18. The Company has not made any preferential allotment of shares to any person duringthe year.

19. The Company does not have any outstanding debentures. Therefore, the provision ofclause 4(xix) of the Companies (Auditor's Report) Order,2003 is not applicable to theCompany.

20. The Company has not raised any money by public issue during the year.

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.