1.  We have audited the attached Balance Sheet of M / s Jai Parabolic
 Springs Limited as at 31st March, 2007 and also the Profit & Loss
 Account and Cash Flow Statement for the year 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 amount 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 the Company Law Board in terms of section 227(4A) of the Companies
 Act, 1956, and on the basis of such, checks as,:we-considered
 appropriate, we enclose in the Annexure a statement on the matters
 specified in paragraphs 4 and 5 of the said Order to the extent
 applicable.
 
 4.  Further to our comments in the Annexure referred to in paragraph 1
 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 purposes of
 our audit.
 
 (ii) In our opinion, proper books of account, as required under the
 law, have been kept by the Company, so far as appears from our
 examination of the books.
 
 (iii) The Balance Sheet and Profit & Loss Account dealt with by this
 report is in agreement with the books of accounts.
 
 (iv) In our opinion the Balance Sheet and Profit & Loss Account dealt
 with by this report are in compliance with the mandatory Accounting
 Standards referred to in Section 211 (3C) of Companies Act, 1956 to the
 extent applicable except referred to in para. (vi) below 
 
 (v) On the basis of the written-representations received from the
 directors as on 31.03.2007 and taken on record by the Board of
 Directors, we report that none of the Directors as on 31.03.2007 is
 disqualified from being appointed as a Director in terms of clause (g)
 of Sub-Section (1) of Section 274 of the Companies Act, 1956.
 
 (vi) We draw attention to schedule 19:
 
 a) Note No 16 regarding recognition of Deferral Sales Tax liability
 amounting to Rs. 985.44 lacs (Previous year Rs.  838.58 Lacs ) on Net
 Present Value, instead of historical cost convention amounting.  As a
 consequences of the same, the loss for the year is understated by a sum
 of Rs. 33.48 lacs:and a cumulative balance of the Profit and Loss
 Account by the sum of Rs.807.46 lacs.
 
 b) Note No 6 regarding non .provision of diminution in the carrying
 value of the assets of the discontinued Mohali Unit Subject to the
 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 significant accounting policies and notes thereon, give the
 information required Jby the Companies Act, 1956 in the manner so
 required and give a true and fair view in conformity with the
 accounting principles generally accepted in India : •
 
 i) in-the casebf Balance Sheet, of the State of Affairs of the
 Company as-at 31.03.2007.
 
 ii) in the case of Profit and Loss Account, of the loss for the year
 ended:bn that date; and
 
 iii) in the case of Cash Flow Statement, of the cash flows for the year
 ended on that date.
 
 ANNEXURE TO AUDITORS REPORT ON THE ACCOUNTS OF JAI PARABOLIC SPRINGS
 LIMITED FOR THE YEAR ENDED 31st MARCH, 2007, AS REFERRED TO IN OUR
 REPORT OF EVEN DATE
 
 Referred to in Paragraph I of our report of even date:
 
 
 i.  (a) The company has maintained proper records showing full
 particulars, including Quantitative details and situation of
 fixed-assets in respect of its Chennai unit only.
 
 (b) All the assets have not been physically verified by the Management
 during the year, but there is a regular programme of verification
 which, in our opinion, is reasonable having regard to the size of the
 company and the nature of its assets. No material discrepancies were
 noticed on such verification.
 
 (c) In our opinion, a substantial part of the fixed assets have not
 been disposed .off during the year.
 
 ii.  (a) The inventory has been physically verified during the year by
 the Management inour opinion, the frequency of verification is
 reasonable.
 
 (b) The procedure 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) On the basis of our examination of the records of inventory, we are
 of the opinion that the company is maintaining proper records of
 inventory. The discrepancies noticed on verification between the
 physical stocks and the book records were not material.
 
 iii.  (a) According to the information and explanation given to us, the
 ,company has not .granted any loans, secured or unsecured to companies,
 firms or other parties covered in the register maintained under Section
 301 of the Act.  (b) to (d)
 
 In view of the what has been stated above, clause 3(b) regarding terms
 and conditions-of such loans, clause 3(c) - regarding payment of
 principal amount and interest and clause 3(d) regarding steps for
 recovery of overdue amount of-Para 4 of the Order are not applicable to
 the company for the year in respect of loan .given by the company
 
 The Company had not taken any loans secured or unsecured from
 companies, firms or other parties covered in the register maintained
 under section 301 of the Companies Act, 1956. Accordinly, the
 provisions of clause 4(iii)(f) and 4(iii)(g).of the.order are not
 applicable to the company.
 
 iv.  In our opinion and according to the information and explanations
 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 purchase of inventory and fixed assets and for the
 sale of goods and services. During the course of our audit/no major
 weakness has been noticed in the. internal control system in respect of
 these areas.  Accordingly) provisions of clause 4(v)(b) of the Order
 are not applicable to the Company, v.  In respect of transactions
 covered under Section 301 of the Companies Act; 1956
 
 (a) In our opinion and according to the information and explanation
 given to us, the transactions made in pursuance of contracts or
 arrangements that needed to be entered into the register maintained
 under Section 301 of the Companies Act, 1956 have been so made.
 
 (b) In our opinion and according to the information and explanation
 given to us the transactions in pursuance of contracts or arrangements
 entered into register maintained under Section 301 of the Companies
 Act, 1956 have beenmade at prices which are reasonable having regard
 to the explanation furnished by the management regarding necessity of
 meeting the technical specification, quality control requirements and
 delivery schedules. The comparison of the prices of similar transaction
 with other parties and the prevailing market prices is not available
 since the company has not dealt with other in this regard.
 
 vi.  During the year under review, the company has not accepted any
 deposits from the public.
 
 vii.  In our opinion, the company has an internal audit system
 commensurate with its size and nature of its business.
 
 viii. The Central Government has prescribed the maintenance of cost
 records by the company. We have carried out a limited review of the
 books of accounts maintained by the company pursuant to Rules made by
 the Central Government for maintenance of Cost Records under section
 209(l)(d) of the Companies Act, 1956. We have been informed that the
 prescribed records are still under implementation. We have not made a
 detailed examination of the said records with a view to determine
 whether they are accurate or the extent to which the same has been
 implemented.
 
 ix. a) Undisputed statutory dues including provident fund, investor
 education and protection fund, employees state insurance,
 income-tax/sales-tax, wealth-tax, service tax, customs duty, excise
 duty, cess have generally been regularly deposited with the appropriate
 authorities though there has been a slight delay ina few cases.
 
 (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, sales-tax, customs duty, excise duty, cess and other
 undisputed statutory dues were outstanding, at the year end, for a
 period of more than six months from the date they became payable.
 
 (c) According to the records of the Company and information and
 explanation provided, there are no/dues outstanding towards income-tax,
 sales-tax, wealth-tax, service tax, customs duty, excise duty and cess
 on account of any dispute.
 
 x. Accumulated losses of the Company at the end of the financial year
 are more then fifty percent of its net worth. The Company has not
 incurred any cash losses during the year under report as well as in the
 immediately preceding financial year.  :
 
 xi.  The company has not defaulted in repayment of dues to any
 financial institutions or banks or debenture holder during the year.  
 
 xii. According to the information and explanations given to us and
 based on the documents and records produced 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 Company is not a chit fund.or a Nidhi or
 Mutual Benefit Fund / Society. Therefore,- the. provision of clause
 4(xiii) of the Companies (Auditors Report) Order 2004 are not
 applicable to the Company.  :.
 
 xiv.  The nature of Companys business / activities during the year
 does not include dealing,in shares, securities, debentures or other
 investments, hence the .requirement of offering comments on this clause
 is not applicable,
 
 xv. As informed to us, the Company has not given any guarantees for any
 loans taken by others from other banks or financial institutions.
 
 xvi. The company has not raised any term loans during the year and
 hence the provision of Clause 4(xvi) of the Companies (Auditors
 Report) Order 2003 are not applicable to .the Company.
 
 xvii. According to the information and explanation given to us and
 overall examination of the Balance Sheet of the Company, we report that
 no funds raised on short term basis have been for long term investment
 and vice versa.
 
 xviii. The company has made preferential allotment of shares to parties
 covered in the Register maintained under Section 301 of the Companies
 Act, 1956 during the year under report. In our opinion, the price at
 which shares have been issued is not prejudicial to the interest of the
 company.
 
 xix. During the period covered by our audit report, the Company has not
 issued any debentures requiring report under this clause.
 
 xx.  The company has not raised any money by Public Issue during the
 year.
 
 xxi According to the information and explanation given to us, No fraud
 on or by the company.has been noticed or reported during the year.
 
                                            For A.K. Kalia & Associates
                                                  Chartered Accountants
 
 Place : New Delhi                                    ( Anil K. Kalia )
 Date  : 04.09.2007                                            Prop.