We have audited the attached Balance Sheet of Ansal Properties &
 Infrastructure Limited as at March 31, 2012 and also the Statement of
 Profit and Loss and the Cash Flow Statement of the Company 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.
 
 We have 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 the management, as well as evaluating the overall financial
 statement presentation. We believe that our audit provides a reasonable
 basis for our opinion.
 
 As required by the Companies (Auditors'' Report) Order, 2003 as amended
 by the Companies (Auditors'' Report) (Amendment) Order, 2004
 (collectively the Order) issued by the Central Government of India in
 terms of Section 227 (4A) of the Companies Act, 1956 and on the basis
 of such checks as we considered appropriate and according to the
 information and explanations given to us, we enclose in the Annexure a
 statement on the matters specified in paragraphs 4 and 5 of the said
 Order.
 
 Further to our comments in the Annexure referred to above, we report
 that:
 
 a) 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;
 
 b) In our opinion, proper books of account, as required by law, have
 been kept by the Company so far as appears from our examination of
 those books;
 
 c) The Balance Sheet, Statement of Profit & Loss and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 d) In our opinion, the Balance Sheet, Statement of Profit & Loss and
 Cash Flow Statement, dealt with by this report, comply with the
 Accounting Standards referred to in sub - section (3C) of Section 211
 of the Companies Act, 1956.
 
 e) On the basis of written representations received from the directors
 as on March 31, 2012 and taken on record by the Board of Directors, we
 report that none of the directors is disqualified as on March 31, 2012
 from being appointed as a director in terms of clause (g) of sub
 section (1) of section 274 of the Companies Act, 1956.
 
 f) Without qualifying our opinion, we draw attention to:
 
 i.  Note No. 30 wherein the Company has claimed exemption of Rs. 3448
 lacs in earlier years under section 80 lA of the Income Tax Act, 1961
 being tax profits arising out of sale of Industrial Park units, pending
 the notification of the same by Central Board of Direct Taxes. Further
 the company has taken opinion from a senior counsel that its
 application satisfies all the conditions specified in the said Scheme
 of Industrial Park. We have relied on management contention.  However,
 no exemption is claimed during the current year as there are no sales
 of industrial park units.
 
 ii.  Note No. 32(b) wherein the Company is carrying project inventory
 of Rs. 16833 lacs for one of its Group Housing projects. The company
 had applied to the Authority for developing the project on the basis of
 revised Scheme announced by the Authority for which approval has been
 received envisaging developing the project on a smaller piece of land
 equivalent to the amount paid and surrender balance project land
 subject to certain conditions. Pending final decision of the Authority
 in the matter, the management is of the view that there is no
 impairment in the value of land/ project and we have relied on
 management contention.
 
 iii.  Note No. 32(a) wherein the Company has given advances to land
 owning companies / collaborators I others for purchase / aggregation of
 land / for others to the tune of Rs.13707 lacs.  This includes Rs.
 10000 lacs as security deposits, the recoverability / adjustment of
 which is dependent upon the future events such as launch of project(s)
 for which steps have been or are being taken by the Company. As regards
 the balance amount of Rs.3707 lacs, pending details of land purchased
 and financial position of these parties, we understand from management
 that these advances are given in respect of on going transactions with
 collaborators / other parties and are regarded as being in the normal
 course of business. We have relied on management contention.
 
 g) The Company has not considered for the estimated borrowing costs to
 be incurred in future in general for determining the project revenues,
 project inventory and debtors. According to the management the amount
 of these items cannot be determined at this stage, and therefore, we
 are unable to comment on the consequential impact thereof on the
 carrying value of project inventory, revenue recognition and
 outstanding debtors and other adjustments that may be necessitated on
 this account in the financial statements.
 
 h) The Company had, during the year ended March 31, 2010, changed its
 accounting policy in respect of accounting for certain costs in the
 nature of administration and selling costs by charging them off to
 Profit & Loss against the earlier policy of treating them as part of
 project cost for determining project inventory, revenue and debtors.
 Expenditure of such nature incurred in earlier years and considered as
 part of project inventories under Projects/ Contract work in progress
 upto March 31, 2009 has been carried forward as such. Such amount has
 not been determined by the management in view of the practical
 difficulties involved, as explained. In the absence of availability of
 these amounts relating to the period upto March 31, 2009, we are unable
 to comment on the impact thereof on the carrying value of project
 inventories, revenue recognition and outstanding debtors and other
 adjustments that may be required in the financial statements.
 
 Subject to that stated in clause g) and h) above having its impact as
 aforesaid, in our opinion and to the best of our information and
 according to the explanations given to us, the said accounts read with
 the Accounting policies and Notes thereon give the information required
 by the Act, in the manner so required and give a true and fair view in
 conformity with the accounting principles generally accepted in India:
 
 a) In the case of Balance Sheet, of the state of affairs of the Company
 as at March 31,2012;
 
 b) In the case of Statement of Profit and Loss, of the Profit for the
 year ended on that date; and
 
 c) In the case of Cash Flow Statement, of the Cash flows for the year
 ended on that date.
 
 ANNEXURE TO AUDITORS'' REPORT 
 
 (Annexure referred to in our report of even date) Re: Ansal Properties
 & Infrastructure Limited
 
 1.  a. The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 b.  The Company has a phased programme of physical verification of its
 fixed assets which, in our opinion, is reasonable having regard to the
 size of the Company and the nature of its assets. All the fixed assets
 identified during the year for verification have not been physically
 verified by the management. However, discrepancies noticed during
 physical verification have been recorded and accounted for in the books
 of account to the extent of verification carried out.
 
 c.  Fixed assets disposed off during the year were not substantial.
 
 2.  a. As explained to us, physical verification has been conducted by
 the management at reasonable intervals in respect of building material,
 stores & spares and inventory of shops/flats/houses. In our opinion,
 the frequency of such verification is reasonable.
 
 b.  The procedures for the physical verification of inventory followed
 by the management are, in our opinion, reasonable and adequate in
 relation to the size of the Company and nature of its business.
 
 c.  In our opinion, the Company is maintaining proper records of
 inventory. The discrepancies noticed on physical verification of
 inventory as compared to book records were not material and have been
 properly dealt with in the books of account.
 
 3.  a. The company has not granted any loans, secured or unsecured, to
 companies, firms or other parties listed in the register maintained
 under section 301 of the Companies Act, 1956.
 
 b.  Since there are no such loans, the comments regarding repayment of
 the principal amount & interest due thereon and overdue amounts are not
 required.
 
 c.  The company has taken deposits from one of the directors and his
 relative covered in the register maintained under section 301 of the
 Companies Act, 1956. In our opinion the rate of interest and other
 terms and conditions of such deposits are not prima facie, prejudicial
 to the interest of the company. The maximum amount of deposit during
 the year was Rs. 21 lacs and the yearend balance was also Rs. 21 lacs.
 
 d.  In respect of deposits taken, repayment of the principal and
 interest has been regular. There are no overdue amounts at the year
 end.
 
 4.  In our opinion, and according to the information and explanations
 given to us during the course of audit, there are adequate internal
 control systems commensurate with size of the Company and the nature of
 its business with regard to purchase of inventory and fixed assets and
 for the sale of services. Further, on the basis of our examination of
 the books & records of the company, carried out in accordance with the
 generally accepted auditing practices in India, we have neither come
 across nor have we been informed of any instance of major weaknesses in
 the aforesaid internal control systems. The company''s activity does not
 qualify for sale of goods. However, the internal control systems with
 regard to documentation of advances given to land owning companies/
 collaborators/ associates/ others need improvement.
 
 5.  a. To the best of our knowledge and according to the information
 and explanations given to us, we are of the opinion that particulars of
 contracts or arrangements that need to be entered into the register
 maintained under section 301 of the Companies Act, 1956 have been so
 entered, b. In our opinion and according to the information and
 explanations given to us, the transactions with parties in pursuance of
 contracts or arrangements, with whom transactions exceeding the value
 of Rupees Five Lacs in respect of each party have taken place during
 the financial year, are at prices, which are reasonable, having regard
 to the prevailing market prices at the relevant time where such market
 prices are available.
 
 6.  In respect of fixed deposits accepted from the public, the
 provisions of section 58A and 58AA or any other relevant provisions of
 the Act including the Companies (Acceptance of Deposits) Rules, 1975
 have been complied with. We have been informed that no order has been
 passed by Company Law Board or National Company Law Tribunal or RBI or
 any Court or any other Tribunal in this regard.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with the size & nature of its business.
 
 8.  The Central Government has during the year prescribed for
 maintenance of Cost accounting records pursuant to the requirements of
 clause (d) of sub-section (1) of section 209 of the Companies Act, 1956
 with regard to the activities of the company. The Company is in the
 process of making and maintaining those records. However, we are not
 required to carry out a detailed examination of the same.
 
 9.  a. In our opinion and according to the information and explanations
 given to us, according to the records of the Company, undisputed
 statutory dues including Provident Fund, Investor Education and
 Protection Fund, Employees State Insurance, Sales tax, Wealth-tax,
 Custom Duty, Excise Duty, Cess and other material statutory dues,
 wherever applicable, have been generally regularly deposited with the
 appropriate authorities except in certain cases of delays of Service
 Tax which have been deposited with interest. However there are no such
 undisputed statutory dues payable for a period of more than six months
 from the date they became payable as at March 31,2012.
 
 
 b. According to the information and explanations given to us and as per
 the books and records examined by us, there are no dues of Customs
 duty, Excise duty, Service tax and Cess which have not been deposited
 on account of any dispute, except the following in respect of disputed
 Sales tax, Wealth tax and Income Tax along with the forum where dispute
 is pending:
 
 S.No.    Name of Statute                   Nature of Dues
 
 (i)      Income Tax Act                    FBT
 
 (ii)     Income Tax Act                    Interest on FBT
 
 (iii)    Wealth Tax Act                    Wealth Tax
 
 (iv)     Wealth Tax Act                    Wealth Tax
 
 (v)      Wealth Tax Act                    Wealth Tax
 
 (vi)     Haryana Local Area                Local Area
          Development Tax Act               Development Tax
 
 (vii)    Sales Tax Act                     Delhi Sales Tax
 
 (viii)   Sales Tax Act                     Delhi Sales Tax
 
 (ix)     Sales Tax Act                     UP Sales Tax
 
 (x)      UP Trade Tax Act                  UP Sales Tax
 
 (xi)     UP Trade Tax Act                  UP Sales Tax
 
 Name of Statute       Amount       Assessment  Forum where pending
                      (Rs.in lacs)  Year
 
 Income Tax Act            2.14     2007-08     Deputy Commissioner of
                                                Income Tax
 
 Income Tax Act            0.49     2006-07     Asstt. Commissioner of
                                                Income Tax, New Delhi
 
 Wealth Tax Act            0.45     1992-93     Asstt.Commissioner of
                                                Wealth Tax, New Delhi
 
 Wealth Tax Act            0.50     1997-98     Deputy Commissioner of
                                                Wealth Tax, New Delhi
 
 Wealth Tax Act            0.96     2000-01     Deputy Commissioner of
                                                Wealth Tax, New Delhi 
 
 Haryana Local Area 
 Development Tax Act       8.73     2003-04     Joint Excise & Taxation
                                                Commissioner (Appeal), 
                                                Gurgaon
 
 Sales Tax Act             4.47     1999-2000   Assessing Officer, Delhi
 
 Sales Tax Act            33.17     2004-05     Trade Tax Tribunal, Delhi
 
 Sales Tax Act             0.29     2006-07     Additional Commissioner
                                               (Appeal), Ghaziabad 
 
 U P Trade Tax Act         2.38     2008-09     Additional Commissioner
                                               (Appeal), Ghaziabad
 
 U P Trade Tax Act         1.08     2008-09     Additional Commissioner
                                               (Appeal), Ghaziabad
 
 10.  There are no accumulated losses of the Company as at the end of
 the financial year. There are no cash losses during the financial year
 and in the immediately preceding financial year.
 
 11.  According to the information and explanations given to us and as
 per the books and records examined by us, we report as follows:
 
 (a). In respect of payments due for Debentures on account of Principal,
 Premium and Interest aggregating Rs 5224.15 lacs to LIC Mutual Fund and
 Rs. 750.00 lacs to HDFC India Real Estate Fund (HIREF), payments were
 delayed from 1 day to 343 days and these dues were cleared upto the
 close of financial year except for Rs 819.23 lacs, which was paid to
 LIC Mutual Fund subsequently. Other amount due in respect of Debentures
 to HIREF aggregating of Rs 1559.62 lacs have been outstanding for 1 day
 to 275 days as at the close of financial year and are outstanding as on
 date.
 
 (b). Amounts due in respect of Term Loans from Banks / Financial
 Institutions on account of Principal & Interest aggregating Rs.
 59018.91 lacs were delayed and have been fully paid. These include
 amounts* due to LIC of India (7 instances of Rs.3299.31 lacs-(i) Rs
 3199.31 lac, (ii) Rs 100.00 lac, (iii) 1 to 576 days), IDBI Bank
 Limited (14 instances of Rs. 951.62 lacs- (i) Rs 862.35 lacs, (ii) Rs
 89.27 lacs and (iii) 1 to 120 days), IFCI Limited (16instances
 ofRs.4628.52 lacs - (i) Rs 4578.52 lacs, (ii) Rs 50.00 lacs and (iii) 1
 to 89 days), IFCI Factors Limited (14 instances of Rs.721.02lacs- (i)
 Rs 671.02 lacs, (ii) Rs 50.00 lacs and (iii) 1 to 86 days), HDFC
 Limited(119instances ofRs.14877.29 lacs - (i) Rs 14367.00 lacs, (ii) Rs
 510.29 lacs and (iii) 1 to 99 days), LIC Housing Finance Limited (22
 instances ofRs. 8106.54 lacs-(i) Rs 6740.85 lacs, (ii) Rs 1365.69 lacs
 and (iii) 1 to 159days), Central Bank of India (11 instances of (i) Rs.
 1878.77 lacs and (iii) 1 to40days), United Bank of India (14 instances
 of Rs. 2402.92 lacs- (i) Rs 1855.55 lacs, (ii) Rs 547.37 lacs and (iii)
 1 to 149 days), UCO Bank (22 instances of Rs. 5718.95 lacs-(i) Rs
 5531.80 lacs, (ii) Rs 187.15 lacs and (iii) 1 to 97 days), Yes Bank
 Limited (26 instances of Rs.5440.46 lacs-(i) Rs 4938.99 lacs, (ii) Rs
 501.47 lacs and (iii) 1 to90days), Punjab National Bank (21 instances
 of Rs.10301.59 lacs-(i) Rs 10151.59 lacs, (ii) Rs 150.00 lacs and (iii)
 1 to 139days) and Syndicate Bank (3 instances of (i) Rs. 691.92 lacs
 and (iii) 1 to45days).
 
 (C). In respect of other amounts due to Banks/Financial Institutions
 aggregating to Rs.6855.77 lacs, the payments have been delayed from 1
 day to 183 days and are outstanding as on date. These include amounts
 due to LIC of India (8 instances of Rs.697.28 lacs), LIC Housing
 Finance Limited (5 instances ofRs. 1795.43 lacs), IFCI Limited (2
 instances ofRs.107.53 lacs), IFCI Factors Limited (2 instances ofRs.
 270.67 lacs), HDFC Limited (2 instances of Rs. 2339.66 lacs), UCO Bank
 (1 instance of Rs.87.00 lacs), Yes Bank Limited (1 instance of
 Rs.321.56 lacs) and Punjab National Bank (4 instances ofRs.1236.64
 lacs), explained by the management, the delays are attributable to the
 delays in processing of Company''s proposal for rescheduling and
 restructuring in several cases. *
 
 (i). Amount paid during the financial year.
 
 (ii).  Amount paid subsequent to the close of financial year.
 
 (iii).  Delay ranging in days.
 
 12.  According to the information and explanations given to us, the
 Company has not granted any loans and advances on the basis of security
 by way of pledge of shares, debentures and other securities
 
 13.  The Company does not fall within the category of Chit fund I
 Nidhi/Mutual Benefit fund/Society and hence the related reporting
 requirements of the Order are not applicable.
 
 14.  According to the information and explanations given to us, the
 Company is not dealing or trading in shares, securities, debentures and
 other investments and hence the related reporting requirements of the
 Order are not applicable.
 
 15.  The Company has given guarantees against loans taken by others
 from banks & financial institutions; the terms & conditions of such
 guarantees are not, prima facie, prejudicial to the interest of the
 company.
 
 16.  In our opinion and according to the information and explanations
 given to us, the term loans raised during the year by the Company have
 been generally applied for the purpose for which the said loans were
 obtained and for overall project related activity in general.
 
 17.  According to the information and explanations given to us and as
 per the books and records examined by us, on an overall examination of
 the Balance Sheet of the company, the funds raised by the Company on
 short-term basis have not been applied for long-term investment.
 
 18.  The Company has not made any preferential allotment of shares to
 parties and Companies covered in the register maintained under section
 301 of the Companies Act, 1956.
 
 19.  According to the information and explanations given to us and the
 records examined by us, the company has created necessary securities
 for the debentures issued except those issued to one of the lenders
 wherein the security provided by the company is less than the total
 amount of debentures necessitating classification of the balance amount
 of debentures as unsecured. We are explained that the said lender is
 not pursuing for any additional security.
 
 20.  The company has not raised any money by way of public issues
 during the year.
 
 21.  During the course of our examination of the books and records of
 the Company carried out in accordance with the generally accepted
 auditing practices in India, we have neither come across any instance
 of fraud on or by the Company, noticed and reported during the year,
 nor have we been informed of such case by the management.
 
                                        For S. S. KOTHARI MEHTA & CO.
 
                                               Chartered Accountants
 
                                               Firm Reg. No. 000756N
 
                                                    (ARUN K. TULSIAN)
 
                                                             Partner
 
                                                Membership No. 89907
 
 Date : 26th May, 2012
 
 Place : New Delhi