We have audited the attached Balance Sheet of CITURGIA BIOCHEMICALS
 LIMITED as at 31st March 2012, and also the Profit & Loss Account and
 Cash Flow Statement for the year ended 31st March 2012 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 conducted our audit in accordance with the 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 statements
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 We report that: -
 
 1.  As required by the Company''s (Auditor''s Report)(amendment)
 order, 2004 notified by the Central Government of India in the
 Department of Company Affaires (vide notification no. GSR 766 (E) dated
 25.11.2004 in terms of sub-section (4A) of section 227 of the Companies
 Act, 1956 (1 of 1956) we enclose in the Annexure hereto a statement of
 the matters specified in paragraph 4 and 5 of the said order.
 
 2.  Further to our comments m the Annexure referred to in paragraph 1
 above and subject to our following observations and subject to the
 notes to the accounts given in schedule ''N'' annexed to the Balance
 Sheet.
 
 i.  Pursuant to the order of the State Government of uttarakhand under
 which the whole premises of the company at Rishikesh have been ceased
 and under Government possession due to which the very existence of the
 company has come at a stake,
 
 ii.  Pursuant to the order of the Hon''ble High Court of Uttarakhand
 and thereafter the consequential orders of Hon''ble BIFR and State
 Government due to which substantial part of the sanctioned
 rehabilitation scheme i.e.  change of land use and redevelopment of
 surplus land stands cancelled,
 
 iii. Non-provision for the loss of Rs. 329.68 Lacs being the value of
 inventories in the real estate division which have come at stake due to
 cancellation of change of land use and non provision of consequential
 losses which are not quantifiable at this stage as the matter is
 pending before the Hon''ble Supreme Cotuit of India. As a result the
 losses have been understated to this extent,
 
 iv.  Inability to physically verify various fixed assets, plant and
 machinery and inventories and part of books of accounts lying at
 Rishikesh premises which are under Government seal,
 
 v.  Non-availability of bank balance confirmation certificates and
 unconfirmed balances of Sundry Creditors and inter corporate deposits,
 
 VI. Despite all the above points the annual accounts of the company
 have been prepared on going concern concept in anticipation of getting
 justice from the Apex Court.
 
 3.  Further to our comments in Annexure referred to point no. 2 above
 we report that
 
 a.  We have obtained all die information and explanations which to the
 best of our knowledge and belief were necessary for the purposes of our
 audit
 
 b.  In our opinion proper books of accounts required by aw have been
 kept by the company so far as appears from our examination of those
 books.
 
 c.  I he balance Sheet & Profit and Loss Account dealt with by this
 report are in agreement with the books of account.
 
 d.  In our opinion the Balance Sheet & Profit and Loss account 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.  In our opinion, and based on information & explanations given to us
 non of the directors are disqualified as on 31st March, 2012 from being
 appointed as a director in terms of clause(g) our sub-section(l) of
 section 274 of the companies Act, 1956
 
 f.  In our opinion and to the best- of our information and according to
 the explanations giver to us the said accounts read together with the
 significant Accounting Policies and other notes thereon give the
 information required by Companies Act, 1956 in the manner so required
 and present a true and fair view in conformity with the accounting
 principal generally accepted in India.
 
 i.  In so far as it relates to Balance Sheet, of the state of affairs
 of the Company as at 31st March 2012 and
 
 ii.  In so far as it relates to Profit & Loss account of the loss for
 the period ended on that date.
 
 iii. In so far as it relates to the cash and fund flow statement for
 the period ended on that date.
 
 Annexure to the Auditors Report
 
 (Referred to in Paragraph 1 of our report of even date on the accounts
 for the period ended 31st March, 2012 of CITURGIA BIOCHEMCIALS LIMITED)
 
 (i) (a) As explanation given by the management in respect of its fixed
 assets in schedule D forming part of accounts regarding the lock out by
 State Government of  at the Rishikesh Plant, subject
 thereto
 
 The company has maintained proper records of fixed assets showing full
 particulars including quantitative details and location of fixed assets
 at head office.
 
 (b) Assets were not physically verified during the period by the
 management in view of lockout by State Government of Uttarakhand at
 Rishikesh plant as disclosed.
 
 (u) (a) As per information and explanation received from the management
 the inventory has not been physically verified during the period under
 audit due to lockout at Rishikesh plant.
 
 (b) Not applicable
 
 (c ) In view of lockout the same is not applicable
 
 (a) The company has not granted unsecured loans to any party covered in
 the register maintained under section 301 of the companies Act, 1956.
 
 (b) According to the information & explanations given to us the rate of
 the interest and other terms & conditions in respect of unsecured loans
 given by the company, are not   facie prejudicial to the interest of
 the company.
 
 (c) In our opinion and according to the information and explanations
 given to us, the receipt of principle amount and interest is regular.
 
 (d) In our opinion and according to the information and explanations
 given to us there are no overdue amounts in respect of the unsecured
 loans given by the company.
 
 (e) The company has not taken unsecured loans from party covered in the
 register- maintained under section 301 of the companies act 1956.
 
 (f) Whether the rate of interest and other terms and conditions of
 loans taken by the company, secured or unsecured are prima facie
 prejudicial to the interest of the company and ------Not
 Applicable
 
 (g) Whether payment of the principal amount and interest are also
 regular. Not Applicable
 
 (IV ) In our opinion and according to the information and explanation
 given to us, there are adequate internal control procedures
 commensurate with the size of the company and the nature of its
 business for the purchase fixed assets and other items and not pirma
 facie prejudicial to the interest of the company.
 
 (y) (a) Transactions that need to be entered into a register in
 pursuance of section 301 of the Act have been entered.
 
 (b) In our opinion and to the best of our knowledge each of these
 transaction exceeding the value of Rs. 5 lacs in respect of any party
 and in any one financial year, have been made at prices which are
 reasonable having regard to the prevailing market prices at the
 relevant time.
 
 (vi) Since the company has not accepted any deposited from public
 accordingly the provision requiring that whether the directives issued
 by the Reserve Bank of India and the provisions of section 58 A and
 58AA of the Act the rules framed there under, were applicable have been
 complied with is not applicable to the company.
 
 (vii) In view of lock out at calcium carbonate division at Rishikesh
 the company has been unable to conduct the internal audit for the
 period end report.
 
 (viii) The provisions requiring maintenance of cost records as
 prescribed by the Central Government under clause (d) of sub-section
 (1) of section 209 of the Act are not applicable to the company.
 
 (ix) (a) The provisions of investor Education and Protection Fund are
 not applicable to the company.  With reference to the provisions of the
 Sales Tax , Wealth Tax, Customs Duty and Excise Duly/Cess are
 applicable to the company. The company is not regular in depositing its
 statutory dues in respect of ESIC, EPF & Income Tax with ''the
 appropriate authorities A amount of Rs. 12.31 lacs is outstanding as
 payable for statutory liabilities and   as on 31.03.2012.
 
 (b) As per records of the company'' there are disputed amounts payable as
 at 31.03.2012 in respect of income tax, wealth tax, custom duty and
 excise duty etc. Further as per notes of accounts liabilities towards
 income tax, sales tax/excise and ESIC matter are lying with respective
 tribunal/courts and the same are shown as contingent liability.
 
 (x) In our opinion and to the best of our knowledge and as per
 information and explanation received from the management the company
 has not defaulted in repayment of dues to a bank.
 
 (xi) The provisions requiring that, whether adequate documents and
 records are maintained in cases where the company has granted loans and
 advances on the basis of security by way of pledge of shares,
 debentures and other securities are not applicable to the company.
 
 (xii) To the best to our knowledge the provisions special statues
 applicable to chit fund are not applicable to the company.
 
 (xiii) Since the company is not dealing in shares and securities
 comments under this clause of the order are not required.
 
 (xiv) As per explanation/representation received from the management
 the company has not given any guarantee for loans taken by others from
 bank or financial institutions hence the provisions requiring whether
 the terms and conditions whereof are prejudicial to the interest of the
 company, are not applicable to the company.
 
 (xv) The company has not availed any short-term loan from the bank to
 the best of our knowledge & belief.
 
 (xvi) The company has not utilized the funds on short-term basis for
 long term investment and vice- versa.
 
 (xvii) As per information given to us the company has not made
 preterennal allotment of shares to parties and companies covered in the
 Register maintained under section 301 of the Act.
 
 (xviii) The provisions requiring that whether securities have been
 created in respect of debentures issued, are not applicable to the
 company.
 
 xix) The provisions requiring that, whether the management has
 disclosed on the end use of money raised by public issues and the same
 has been not applicable to the company which is prejudicial to the
 interest of members of company.
 
 xx) No fraud on or by the company has been noticed or reported during
 the period.
 
                                          For RANJAN GUPTA & CO.  
 
                                          Chartered Accountants
 
                                          Ranjan Gupta
 
                                         (FCA)
 
                                          M.No. 500-82408 
 
 Place: New Delhi 
 
 Date : 04/09/2012.