1.  We have audited the attached balance sheet of Aksh Optifibre
 Limited as at 31st March, 2012 and also the statement of profit & loss
 and the cash flow statement for the year ended on that date annexed
 thereto. These financial statements are the responsibility of the
 company''s 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 (Auditor''s 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, statement of profit and loss and cash flow
 statement dealt with by this report are in agreement with the books of
 account;
 
 iv) In our opinion, the balance sheet, statement of profit and loss 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, 2012 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31st March, 2012 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 32 to the financial statements
 regarding the opinion framed by the Company for non provision of
 investments and outstanding dues with one of its subsidiary.
 
 vii) 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 our comments in para (vi) above along with
 the Accompanying Notes to the Financial Statements, 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, 2012;
 
 b) In the case of Statement of Profit and Loss, of the profit 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.
 2012
 
 (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 unsecured loan to one of its wholly owned
 subsidiary. The maximum amount involved during the year was Rs.
 1,296,104,690 and the closing balance of loan given to such party was
 Rs. 1,242,969,611
 
 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. 168,485,000 and the
 closing balance of loan taken from such parties was Rs. 92,755,000.
 
 (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)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,
 1956 and we are of the opinion that prima facie the prescribed accounts
 and records have been made and maintained.
 
 (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, 2012 for a
 period of more than six months from the date they become payable except
 Rs. 390,790 relating to sales 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 as under :
 
 Name of the Statute            Nature of Dues               Amount
                                                            (Rs.)
 
 AP Vat Act                     Sales Tax Demand           18,075,000
 
 Provident Fund Act             Provident Fund                759,921
 
 DVAT Act                       Sales Tax Demand           20,964,327
 
 Rajasthan Sales Tax Act        Sales Tax Demand            7,111,596
 
 Finance Act,1994               Service Tax Demand            750,000
 
 Finance Act,1994               Service Tax Demand            553,805
 
 Finance Act,1994               Service Tax Demand              9,753
 
 Finance Act,1994               Service Tax Demand             64,332
 
 Finance Act,1994               Service Tax Demand          7,553,371
 
 Customs Act,1962               Custom Duty Demand         36,091,482
 
 Customs Act,1962               Custom Duty Demand          4,805,937
 
 Central Excise Act,1944        Excise Duty Demand          9,214,075
 
 Central Excise Act,1944        Excise Duty Demand            336,754
 
 Name of the Statute      Year to which    Forum where dispute is pending
                          Amount Relates
 
 AP Vat Act               2005-06          Hon''ble High Court, 
                                           Hyderabad 
 
 Provident Fund Act       2004-05          Hon''ble High Court, Jaipur
 
 DVAT Act                 2007-08          Commissioner (Appeals)
 
 Rajasthan Sales Tax 
 Act                      1996-97, 
                          1998-99,         Hon''ble High Court Jaipur.
                          2000-01 & 
                          2001-02
 
 Finance Act, 1994        2004-05          Hon''ble High Court Jaipur.
 
 Finance Act, 1994        2004-05          Commissioner of Central Excise
                                          (Appeals), Jaipur
 
 Finance Act, 1994        2008-09          Commissioner of Central Excise
                                          (Appeals), Jaipur
 
 Finance Act, 1994        2004-06          CESTAT
 
 Finance Act, 1994        2006-08          Assistant Commissioner,Bhiwadi
 
 Customs Act, 1962        2005-06          CESTAT
 
 Customs Act, 1962        2008-09          CESTAT
 
 Central Excise Act, 1944 2003-05          CESTAT
 
 Central Excise Act, 1944 2000-01          CESTAT
 
 (x) In our opinion, the accumulated losses of the company are not more
 than fifty percent of its net worth. The Company has not incurred cash
 loss during the year covered by our audit; however company has incurred
 cash loss in the immediately preceding financial year.
 
 (xi) Bonds of $ 1 mn having maturity value of $ 1.205mn equivalent to
 Rs. 61,310,400 issued in pursuant of the redemption of FCCBs amounting
 $ 1 mn redeemable were as on 29th January, 2010. However, pursuant to
 RBI approval and at the request of Bondholder, the Company has after
 March 31,2012 issued fresh FCCBs in exchange of outstanding FCCBs.
 
 (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 (Auditor''s Report)
 Order, 2003 (as amended) are not applicable to the company.
 
 (xv) According to the information and explanations given to us, the
 company has not given any guarantee for loans taken by others from
 banks and financial institutions.
 
 (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.O. BINDAL & CO.
 
                                         Chartered Accountants
 
                                                  FRN: 003824N
 
                                                CA .K.C. GUPTA
 
 Place: New Delhi                                      Partner
 
 Date: 26.11.2012                        Membership No: 088638