Aksh Optifibre

1.  We have audited the attached balance sheet of Aksh Optifibre
 Limited as at 31st March, 2009 and also the profit & loss account and
 the cash flow statement for the period 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 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 and 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, 2009 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31st March, 2009 from being appointed as a director in terms of clause
 (g) of sub section (1) of section 274 of the Companies Act, 1956;
 
 vi) Subject to above, in our opinion 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 N give the information
 required by the
 
 Companies Act, 1956 in the manner so required and give 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, 2009;
 
 b) In the case of Profit & Loss Account, of the loss of the company for
 the period ended on that date; and
 
 c) In the case of the cash flow statement, of the cash flows for the
 period 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 PERIOD ENDED ON 31st MARCH.
 2009
 
 (i) (a) The company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) The fixed assets have been physically verified by the management
 during the period. No material discrepancies were noticed on such
 verification. In our opinion, the frequency of physical verification of
 fixed assets is reasonable.
 
 (c) During the period, the company has not disposed off substantial /
 major part of fixed assets.
 
 (ii) (a) As explained to us, the inventory has been physically verified
 during the period 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 not granted any loan to parties covered in the register
 maintained under section 301 of the Companies Act, 1956. Accordingly,
 the clauses 4 (iii) (a) to (d) of the order are not applicable.  (b)
 According to the information and explanations given to us, the company
 has taken unsecured loans from two parties covered in the register
 maintained under section 301 of the Companies Act, 1956. The maximum
 amount involved during the period was
 Rs.3,111.56 lacs and the closing balance of loan
 taken from such parties was Rs. 958 lacs.
 
 (c) 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.
 
 (d) 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) We have broadly reviewed the books of account relating to
 materials, labour and other items of cost maintained by the company
 pursuant to the Rules made by the Central Government for the
 maintenance of cost records under section 209(1) (d) of the Companies
 Act, 1956 and we are of the opinion that prima facie the prescribed
 accounts and records have been made and maintained. We have not,
 however made a detailed examination of the records with a view to
 determining whether they are accurate and correct.
 
 (ix) (a) According to the information and explanations given to us and
 according to the books and records produced before us, the company is
 regular in depositing with appropriate authorities 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, Custom Duty, Excise Duty, Cess and other material statutory
 dues were in arrears, as at 31st March, 2009 for a period of more than
 six months from the date they become payable except Rs.3.91 lacs
 relating to sales tax and Rs.0.69 lacs relating to service tax.
 
 (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 asunder:
 
 (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 period covered by our audit; however the Company has not
 incurred cash loss during the immediately preceding accounting period.
 
 (xi) In our opinion and according to the information and explanations
 given to us, the company has not defaulted in repayment of dues to
 financial institutions, banks or debenture holders except letters of
 credits aggregating to Rs 685.50 lacs were not paid on due dates.
 Average delay per letter of credit was 19.3 days.
 
 (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 are not applicable to the company.
 
 (xv) According to the information and explanations given to us, the
 company has not given any guarantees for loans taken by others from
 banks or financial institutions.
 
 (xvi) According to the information and explanations given to us, the
 company has not availed any term loan during the period 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 has issued Convertible debentures during the period which were
 later on converted into equity shares during this period.
 
 (xx) We have verified the end use of money raised by public issue from
 the offering circular and as disclosed in the notes to the financial
 statements.
 
 (xxi) According to the 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
 
                                                         K.C. GUPTA
 Place: New Delhi                                           partner   
 Dated:26/05/2009                            Membership No.: 088638