1.  We have audited the attached balance sheet of Aksh Optifibre
 Limited as at 31st March, 2011 and. also the profit & loss account and
 the cash flow statement for the year ended on that date annexed
 thereto. These financial statements are the responsibility of the
 companys management. Our responsibility is to express an opinion on
 these financial statements based on our audit.
 
 2.  We conducted our audit in accordance with auditing standards
 generally accepted in India. Those Standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free of material misstatement. An audit
 includes examining, on a test basis, evidence supporting the amounts
 and disclosures in the financial statements. An audit also includes
 assessing the accounting principles used and significant estimates made
 by management, as well as evaluating the overall financial statement
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 3.  As required by the Companies (Auditors Report) Order, 2003 (as
 amended) issued by Central Government of India in terms of sub-section
 (4A) of section 227 of the Companies Act, 1956, we enclose in the
 Annexure a statement on the matters specified in paragraphs 4 and 5 of
 the said Order.
 
 4.  Further to our comments in the annexure referred to above, we
 report that:
 
 i) We have obtained all the information and explanations, which to the
 best of our knowledge and belief were necessary for the purpose of our
 audit;
 
 ii) In our opinion, proper books of account as required by the law have
 been kept by the company, so far as appears from our examination of
 those books ;
 
 iii) The balance sheet, profit & loss account, and cash flow statement
 dealt with by this report are in agreement with the books of account;
 
 iv) In our opinion, the balance sheet, profit & loss account and cash
 flow statement dealt with this report comply with the accounting
 standards referred to in section 211(3C) of the Companies Act, 1956;
 
 v) On the basis of the written representations received from the
 directors as on 31st March, 2011 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31st March, 2011 from being appointed as a director in terms of clause
 (g) of sub section (1) of section 274 of the Companies Act, 1956 ;
 
 vi) Attention is invited to the note 16 of schedule L regarding the
 opinion framed by the Company for non provision of investments and
 outstanding dues with one of its subsidiary.
 
 vii) Subject to our comments in para (vi) above and their consequential
 effects on the net assets or operations (if any), quantum of which can
 not be ascertained, based on our audit on financial statement and to
 the best of our information and according to the explanations given to
 us, the said accounts read together with the Notes to Accounts-
 Schedule L give the information required by the Companies Act, 1956
 in the manner so required andgive a true and fair view in conformity
 with accounting principles generally accepted in India:
 
 a) In the case of Balance Sheet, of the state of affairs of the company
 as at 31st March, 2011;
 
 b) In the case of Profit & Loss Account, of the loss of the company for
 the year ended on that date; and
 
 c) In the case of the cash flow statement, of the cash flows for the
 year ended on that date.
 
 ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE
 TO THE MEMBERS OF AKSH OPTIFIBRE LIMITED FOR THE YEAR ENDED ON 31st
 MARCH. 2011
 
 (i) (a) The company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) As per information & explanation given to us fixed assets except
 the assets installed at customer premises have been physically verified
 by the management during the year. No material discrepancies were
 noticed on such verification. In our opinion, the frequency of physical
 verification of fixed assets is reasonable.
 
 (c) During the year, the company has not disposed off substantial /
 major part of fixed assets.
 
 (ii) (a) During the year, the inventory has been physically verified by
 the management. In our opinion, the frequency of verification is
 reasonable.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical
 
 verification of inventories followed by the management are reasonable
 and adequate in relation to the size of the company and the nature of
 its business.
 
 (c) In our opinion and according to the information and explanations
 given to us and on the basis of our examination of the records of
 inventory, the company is maintaining proper records of inventory. The
 discrepancies noticed on verification between the physical stocks and
 the books records were not material and have been properly dealt with
 in the books of accounts.
 
 (iii) (a) According to the information and explanations given to us,
 the company has granted interest free unsecured loan to two wholly
 owned subsidiaries.  The maximum amount involved during the year was
 Rs. 10927.06 lacs and the closing balance of loan given to such parties
 was Rs. 10927.06 lacs.
 
 b) According to the information and explanations given to us, in our
 opinion, the other terms and conditions on which loans have been
 granted to parties listed in the register maintained under section 301
 of the Companies Act, 1956 are not, prima facie, prejudicial to the
 interest of the Company.
 
 c) As per the information made available to us, the aforesaid advance
 granted by the company is repayable on demand.
 
 d) In respect of the aforesaid advances, there is no overdue amount as
 at year-end.
 
 (e) According to the information and explanations given to us, the
 company has taken unsecured loans from five parties covered in the
 register maintained under section 301 of the Companies Act, 1956. The
 maximum amount involved during the year was Rs..  2955.35 lacs and the
 closing balance of loan taken from such parties was Rs. 885.85 lacs.
 
 (f) According to the information and explanations given to us, in our
 opinion, the rate of interest and other terms and conditions on which
 unsecured loans have been taken from companies, firms or other parties
 listed in the register maintained under section 301 of the Companies
 Act, 1956 are not, prima facie, prejudicial to the interest of the
 Company.
 
 (g) According to the information and explanations given to us, the
 payments of the principal amount and interest of the aforesaid loan are
 regular.
 
 (iv) In our opinion and according to the information and explanation
 given to us, there is an adequate internal control system commensurate
 with the size of the company and the nature of its business for the
 purchases of inventory, fixed assets, sale of goods and services.
 During the course of our audit, we have not
 
 observed any major weaknesses in internal control system.
 
 (v) (a) According to the information and explanations given to us, we
 are of the opinion that the particulars of all contracts or
 arrangements need to entered into the register maintained under section
 301 of the Companies Act, 1956 have been so entered ; and
 
 (b) In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 arrangements referred to in section 301 of the Companies Act, 1956 have
 been made at prices which are reasonable having regard to prevailing
 market prices at the relevant time.
 
 (vi) In our opinion and according to the information and explanations
 given to us, the company has not accepted any deposits from public to
 which provisions of sections 58A and 58AA or any other relevant
 provisions of the Companies Act, 1956 and the Companies (Acceptance of
 Deposits) Rules, 1975 apply. No order has been passed by the Company
 Law Board or National Company Law Tribunal or Reserve Bank of India or
 any Court or any other Tribunal.
 
 (vii) In our opinion, the company has an internal audit system
 commensurate with the size and nature of its business.
 
 (viii) According to the information and explanations given to us and
 according to the books and records examined by us, the Central
 Government has not prescribed any specific Cost records for the company
 under clause (d) of Sub-section (1) of Section 209 of the Companies
 Act, 1956.
 
 (ix) (a) According to the information and explanations given to us and
 according to the books and records examined by us, the company is
 generally regular in depositing undisputed statutory dues including
 Provident Fund, Investor Education and Protection Fund, Employees
 State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax,
 Custom Duty, Excise Duty, Cess and other material statutory dues
 applicable to it.
 
 (b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of Provident Fund, Investor
 Education and Protection Fund, Employees State Insurance, Income Tax,
 Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other
 material statutory dues were in arrears, as at 31st March, 2011 for a
 period of more than six months from the date they become payable except
 Rs.3.92 Lacs relating to sales tax, 0.66 lacs to relating to service
 tax, and 0.35 lacs to relating to TDS.
 
 (c) According to the information and explanations given
 
 to us. and the records of the Company examined by us , dues of Income
 Tax, Sales Tax , Wealth Tax, Service Tax, Custom Duty, Excise Duty and
 Cess which have not been deposited on account of
 
 disputes and the forum where the dispute are pending as under :
 
 Name of the Statute     Nature of Dues          Amount
                                               (Rs.in lacs)
 
 AP Vat Act              Sales Tax Demand         181.01
 
 Provident Fund Act      Provident Fund             7.60
 
 DVAT Act                Sales Tax Demand         209.64
 
 
 
 
 Name of the Statute     Year to which       Forum where
                         Amount Relates      dispute is pending
 
 AP Vat Act                 2005-06          Honble High Court,
                                             Hyderabad
 
 Provident Fund Act         2004-05          Honble High Court,
                                             Jaipur
 
 DVAT Act                   2007-08          Commissioner
                                             (Appeals)
 
 
 (x) In our opinion, the accumulated losses of the company are not more
 than fifty percent of its net worth. The Company has incurred cash loss
 during the year covered by our audit and also in the immediately
 preceding financial year.
 
 (xi) Bonds of $ 1 mn having maturity value of $ 1.205mn equivalent to
 Rs. 541 lacs issued in pursuant of the redemption of FCCBs amounting $
 1 mn redeemable as on 29th January, 2010 are still outstanding as on
 the balance sheet date.
 
 (xii) According to the information and explanations given to us, the
 company has not granted loans and advances on the basis of security by
 way of pledge of shares, debentures and other securities.
 
 (xiii) In our opinion, the provisions of any special statute applicable
 to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable
 to the company.
 
 (xiv) In our opinion and according to the information and explanations
 given to us, the company is not dealing or trading in shares,
 securities, debentures and other investments, Accordingly, the
 provisions of clause 4(xiv) of the Companies (Auditors Report) Order,
 2003 (as amended) are not applicable to the company.
 
 (xv) According to the information and explanations given to us, the
 company has given corporate guarantee for securing working capital
 facilities sanctioned to its wholly owned subsidiary i.e. Aksh
 Technologies Limited amounting to Rs. 6,055 lacs. In our opinion
 issuance of such guarantee is not prejudicial to the interest of the
 company.
 
 (xvi) According to the information and explanations given to us, the
 company has not availed any term loan during the year under audit.
 
 (xvii) According to the information and explanations given to us and on
 an overall examination of the balance sheet of the company, we report
 that no funds raised on short- term basis have been used for long-term
 investment.
 
 (xviii) According to the information and explanations given to us, the
 company has not made preferential allotment of share to parties covered
 in the register maintained under section 301 of the Act.
 
 (xix) According to the information and explanations given to us, the
 company had not issued any debentures during the year.
 
 (xx) According to the information and explanations given to us, the
 company had not raised any money by way of public issue during the
 year.
 
 (xxi) Based on the audit procedures performed and information and
 explanations given to us, no fraud on or by the company has been
 noticed or reported during the course of our audit.
 
 
 
 
                                                 For P.C. BINDAL & CO.
                                                 Chartered Accountants 
                                                          FRN: 003824N
 
 
 
                                                         CA.K.C. GUPTA
                                                               Partner 
                                                 Membership No: 088638
 
 
 Place : New Delhi 
 Date  : 21.05.2011