We have audited the attached Balance Sheet of ASSOCIATED STONE
 INDUSTRIES (KOTAH) LTD. as at March 31st, 2012 and also Profit and Loss
 Account and 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.
 
 1.  We conducted our audit in accordance with the auditing standards
 generally accepted in India. These standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free of material misstatements. 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.
 
 2.  As required by the Companies (Auditors'' Report) Order, 2003
 issued by the Central Government of India in terms of Section 227 (4A)
 of the Companies Act, 1956 of India (the Act) and on the basis of such
 checks as we considered appropriate and according to the information
 and explanations given to us, we set out in the Annexure a statement on
 the matters specified in paragraphs 4 and 5 of the said Order.
 
 3.  Further to our comments in the Annexure referred to in paragraph 2
 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 Accounts, as required by law, have
 been kept by the Company, so far as appears from our examination of
 those books.
 
 (c) The Balance Sheet and Profit & Loss Account and cash flow statement
 dealt with by this report are in agreement with the books of accounts.
 
 (d) In our opinion the Balance Sheet , Profit and Loss Account and Cash
 Flow statement dealt with by this report comply with the mandatory
 Accounting Standards referred to in sub-section 3C of section 211 of
 the Companies Act, 1956, to the extent applicable.
 
 (e) In our opinion, and based on information and explanations given to
 us, none of the directors are disqualified as on 31st March, 2012 from
 being appointed as director in terms of clause (g) of sub section (1)
 of Section 274 of the Companies Act, 1956;
 
 (f) In our opinion and to the best of our information and according to
 the explanations given to us the said accounts together with the notes
 there on and attached there to give in the prescribed manner the
 information required by the Act and give a true and fair view in
 conformity with the accounting principles generally accepted in India:
 
 i.  In the case of Balance Sheet, of the state of affairs of the
 Company as at 31st March, 2012.
 
 ii.  In case of the Profit & Loss Account, of the profit of the Company
 for the year ended on that date and:
 
 iii. In the case of the Cash Flow statements, of the cash flows for the
 year ended on that date.
 
 ANNEXURE TO AUDITORS'' REPORT
 
 [Referred to in paragraph 2 of the auditors'' report of even date to
 the members of The Associated Stone Industries (Kotah) Ltd.
 
 on the accounts for the year ended 31st March, 2012.]
 
 1) a) The Company is maintaining proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 b) The fixed assets of the Company are physically verified by the
 management according to a phased programme designed to cover all the
 items over a period of three years, which in our opinion, is reasonable
 having regard to the size of the Company and nature of its assets.
 Pursuant to such programme, a physical verification was carried out
 during the year and this revealed no material discrepancies.
 
 c) During the year, the Company has not disposed off substantial part
 of fixed assets.
 
 2) a) The inventory lying at all location except in transit and third
 parties has been physically verified during the year by the management.
 In our opinion, the frequency of verification is reasonable.
 
 b) The procedures of physical verification of inventories followed by
 the management are reasonable and adequate in relation to the size of
 the Company and nature of its business.
 
 c) On the basis of our examination of the records we are of the opinion
 that the Company is maintaining proper records of inventory.
 
 d) The discrepancies noticed on physical verification were not material
 and the same have been properly dealt with in the books of accounts.
 
 3) According to the information and explanations given to us, the
 Company has not granted or taken any loans, secured/ unsecured to/from
 Companies, Firm or other parties covered in the Register maintained
 under Section 301 of the Companies Act, 1956.
 
 4) In our opinion and according to the information and explanations
 given to us, there are adequate internal control procedures
 commensurate with the size of the Company and the nature of its
 business for purchase of inventory and fixed assets and for the sale of
 goods.
 
 During the course of our audit, no major weakness has been noticed in
 the internal controls.
 
 5) a) On the basis of representation made by the management and
 scrutiny of books of accounts carried out by us, the information that
 need to be entered in the Register in pursuance of 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, transactions during the year exceeding the value of five
 lakh rupees in respect of any party which required to be entered in the
 register u/s 301 of Companies Act, 1956 have been made at prices which
 are reasonable having regard to prevailing market prices at the
 relevant time.
 
 6) In our opinion and according to the information and explanations
 given to us the Company has compiled with the directives issued by the
 Reserve Bank of India and the provision of Section 58A and 58AA of the
 Act and the Companies (Acceptance of Deposit) Rules, 1975 with regard
 to the deposits accepted from the public. As per information and
 explanations given to us, no order under the aforesaid sections has
 been passed by the Company Law Board on the Company.
 
 7) In our opinion, the Company has an internal audit system
 commensurate with its size and nature of its business.
 
 8) Rule for maintenance of cost records prescribed under Section 209
 (1) (d) of the Act is not applicable to the Company.
 
 9) a) According to the information and explanations given to us and
 according to the books and records as produced and examined by us, in
 our opinion, the undisputed statutory dues in respect of provident
 fund, investor education and protection fund, employees'' state
 insurance, income-tax, wealth tax, sales tax, customs duty, excise duty
 and other material statutory dues as applicable, have been regularly
 deposited by the Company during the year with the appropriate
 authorities.
 
 b) As at March 31, 2012, according to the records of the Company and
 the information and explanations given to us, the following are the
 particulars of disputed dues (provided/contingent liability, as
 appropriate) on account of sales-tax, income-tax, custom duty,
 wealth-tax, service tax, excise duty and cess matters that have not
 been deposited on account of a dispute-
 
 Name of the      Nature      Amount    Period to which  Forum where 
 statute          of the     (Rs        the amount       dispute is
                  dues        Lacs.)    relates          pending
 
 The Income       Lease       19.02     1951 to 1962     High Court 
 Tax Act, 1961    Payment
 
 Sales Tax Act    Entry Tax  339.47     January 2007     High Court
                                        to March 2012
 
 Cess Matters     Land Tax   229.73     2006 to 2012     DIG Registration
                                                         & Stamps/High 
                                                         Court
                  Royalty      8.61     1977-78,         Mining Dept/
 
                                        1990-91,         High Court
 
                                        1992-93,
 
                                        1993-94
 
 10) The Company has not incurred any cash loss during the financial
 year covered by our audit and the immediately preceding financial year
 and has no accumulated loss.
 
 11) The Company has not defaulted in repayment of dues to financial
 Institution / Bank / Debenture holders.
 
 12) The Company has not granted loans and advances on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 13) The Company is not a chit fund, nidhi of mutual benefit fund /
 society.
 
 14) The Company is not dealing or trading in shares, securities,
 debentures and other investments.
 
 15) The Company has not given any guarantee for loans taken by others
 from banks or financial institution, the terms & conditions, whereof,
 in our opinion, are prima facie prejudicial to the interest of the
 Company
 
 16) According to the information and explanation given to us, term
 loans availed by the Company were prima facie, applied during the year
 for the purposes for which the loans were obtained.
 
 17) According to the cash flow statement and other records examined by
 us and the information and explanations given to us, on an overall
 basis, funds raised on short term basis have prima facie, been not used
 during the year for long term investment and vice versa.
 
 18) The Company has not made any issue of shares during the year.
 
 19) The Company has not issued debenture during the year.
 
 20) The Company has not made any public issue during the year.
 
 21) Based upon the audit procedures performed and information and
 explanations given by the management, no fraud on or by the Company has
 been noticed or reported during the course of audit.
 
                                                for B.L.Ajmera & Co.
 
                                              Chartered Accountants
 
                                                      (FRN: 001100C)
 
 Place: Jaipur
 
 Dated: 31st May, 2012                                         Sd/-
 
                                                    (C. Venkatesan) 
 
                                                           Partner
 
                                              Membership No.010054