VTM Ltd

To the Members of VTM LIMITED

We have audited the attached Balance Sheet of VTM Limited, as at March 31, 2010and also the Profit and Loss Account for the year ended on that date annexed thereto andthe Cash Flow statement for the year ended on that date. These financial statements arethe responsibility of the Company's Management. Our responsibility is to express anopinion on these financial statements based on our audit.

We have conducted our audit in accordance with the auditing standards generallyaccepted in India. Those Standards require that we plan and perform the audit to obtainreasonable assurance about whether the financial statements are free of materialmisstatement. An audit includes examining, on a test basis, evidence supporting theamounts and disclosures in the financial statements. An audit also includes assessing theaccounting principles used and significant estimates made by management, as well asevaluating the overall financial statement presentation. We believe that our auditprovides a reasonable basis for our opinion.

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

2) As required by the Companies (Auditors' Report) Order, 2003 as amended by theCompanies (Auditors' Report) Amendment Order 2004 issued by the Central Government ofIndia in terms of Sub-Section (4A) of Section 227 of the Companies Act, 1956 and on thebasis of such checks of the books and records of the Company as we considered appropriateand the information and explanations given to us, we state that:

i) a) The Company has maintained proper records showing full particulars includingquantitative details and situation of Fixed Assets.

b) According to the information and explanations given to us, the Fixed Assets havebeen physically verified by the Management during the year and no serious discrepanciesbetween the book records and physical inventory have been noticed.

c) The Company has not disposed of a substantial part of the Fixed Assets during theyear.

ii) a) The Company has maintained proper records and the Stocks of finished goods,stores and spare parts and raw materials have been physically verified by the Managementat reasonable periods.

b) In our opinion, the records and procedures of physical verification of the aforesaidstocks followed by the Management are reasonable and adequate in relation to the size ofthe Company and nature of its business.

c) According to the records, no discrepancies have been noticed on such verification ofstocks of finished goods and raw materials. The discrepancies noticed on such verificationof stores and spare parts were not material as compared to Book Stock and the same havebeen properly dealt within the books of Account.

iii) a) The Company has not granted any loans secured or unsecured to Companies, Firmsor other parties as listed in the Register maintained under Section 301 of the CompaniesAct, 1956 and/or the Companies under the same management as defined under Sub-Section (1B)of Section 370 of the Companies Act, 1956.

b) The Company has accepted deposit for leased land from Company as listed in theRegister maintained under Section 301 of the Companies Act, 1956.

iv) In our opinion and according to the information and explanations given to us,during the course of the audit, there are adequate internal control procedurescommensurate with the size of the Company and the nature of its business for the purchaseof raw materials, stores, plant and machinery, equipment and other assets and for sale ofgoods. In our opinion and according to the information and explanations given to us, thereis no continuing failure to correct major weaknesses in internal control.

v) According to the information and explanations given to us, the transactions ofpurchase and sale of goods and materials made in pursuance of contracts or arrangementsentered in the register maintained under Section 301 of the Companies Act, 1956aggregating 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 for suchgoods and materials or the prices at which transactions for similar goods have been madewith other parties.

vi) The Company has not accepted any deposits from the Public during the year.

vii) In our opinion, the Company has an internal audit system commensurate with thesize and nature of its business.

viii) The cost records and accounts prescribed by the Central Government under Section209(1)(d) of the Companies Act, 1956 have been made and maintained by the Company.

ix) a) According to the information and explanations given to us, the Company isregular in depositing undisputed statutory dues payable in respect of Provident Fund,Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales -Tax,Wealth-Tax, Service-Tax, Customs Duty, Excise Duty, Cess and there were no amountsoutstanding as at March 31, 2010 for a period of more than six months from the date theybecame payable.

b) The Company has disputed Tax liability as at March 31, 2010 as stated in Note No.19(8).

x) The Company has no accumulated losses. The Company has not incurred cash losses inthe Financial Year under report and in the immediately preceding Financial Year.

xi) According to the information and explanations given to us, the Company has notdefaulted in repayment of dues to a Financial Institution or Bank or Debenture Holder.

xii) The Company has not granted loans and advances on the basis of security by way ofpledge of shares, debentures and other securities, and in our opinion, adequate documentsand records are maintained.

xiii) Clause (xiii) of the Order is not applicable to the Company as the Company is nota Chit Fund Company, Nidhi or Mutual Benefit Society.

xiv) According to the information and explanations given to us, proper records havebeen maintained in respect of transactions and contracts in shares, securities, debenturesand other investments and timely entries have been made therein. The shares, securities,debentures and other investments, have been held by the Company in its own name.

xv) According to, the information and explantions given to us, the Company has notgiven any guarantee for loans taken by others from Bank or Financial Institutions.

xvi) According to the information and explanations given to us, Term Loans were appliedfor the purpose for which the loans were obtained.

xvii) According to the information and explanations given to us, funds raised onShort-term basis have not been used for long-term investment. Similarly, no funds raisedon long term basis have been used for short-term investments.

xviii) According to the information and explanations given to us, no shares has beenallotted by the Company during the year.

xix) The Company has not issued Debentures and hence requirement of reporting regardingcreation of securities in respect of Debentures issued does not arise.

xx) According to the records of the Company and information and explanations given tous, the Company has not raised any money through public issue during the year.

xxi) According to the information and explanations given to us, a fraud on or by theCompany has not been noticed or reported during the year.

3) In our opinion and to the best of our information and according to the explanationsgiven to us, the attached accounts together with the notes thereon, give the informationrequired by the Companies Act, 1956 in the manner so required and give a true and fairview, in conformity with the accounting principles generally accepted in India:

a) In the case of the Balance Sheet, of the State of affairs of the Company as at March31, 2010.

b) In the case of the Profit and Loss Account, of the Profit of the Company for theyear ended on that date;

and

c) In the case of the cash flow statement, of the cash flows for the year ended on thatdate.

4) On the basis of written representations received from the Directors, as on March 31,2010 and taken on record by the Board of Directors, we report that none of the Directorsis disqualified as on March 31, 2010 from being appointed as a Director of the Company interms of Section 274(1)(g) of the Companies Act, 1956 on the said date.

5) In our opinion proper books of accounts as required by law have been kept by theCompany so far as appears from our examination of those books.

6) In our opinion, the Balance Sheet and Profit and Loss Account complies with theaccounting standards referred to in Sub-Section (3C) of Section 211 of the Companies Act,1956.

7) The Balance Sheet and Profit and Loss Account dealt with by this Report are inagreement with the books of account.