1.  We have audited the attached Balance Sheet of JINDAL SOUTH WEST
 HOLDINGS LIMITED, as at March 31, 2011 and the related Profit and Loss
 Account for the year ended on that date and the 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 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 of our opinion.
 
 3.  As required by the Companies (Auditors Report) Order, 2003 (as
 amended) (the Order), issued by the Central Government of India in
 terms of sub-section (4A) of Section 227 of the Companies Act, 1956
 (the Act), 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 in paragraph
 (3) 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 purposes of our
 audit;
 
 b.  In our opinion, proper books of account as required by law have
 been kept by the Company so far as it appears from our examination of
 those books;
 
 c.  The Balance Sheet, Profit and Loss Account and Cash Flow Statement
 dealt with by this report are in agreement with the books of account;
 
 d.  In our opinion, Balance Sheet, Profit and Loss Account 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 the written representations received from the
 Directors of the Company as on March 31, 2011 and taken on record by
 the Board of Directors of the Company, none of the Directors of the
 Company is disqualified as on March 31, 2011 from being appointed as a
 Director in terms of clause (g) of sub-section (1) of section 274 of
 the Act;
 
 f.  In our opinion and to the best of our information and according to
 the explanations given to us, the said accounts 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:
 
 i.  in the case of the Balance Sheet, of the state of affairs of the
 Company as at March 31, 2011;
 
 ii.  in the case of the Profit and Loss Account, of the profit for the
 year ended on that date and
 
 iii.  in the case of the Cash Flow Statement, of the cash flows for the
 year ended on that date
 
 ANNEXURE TO THE AUDITORS REPORT
 (Referred to in paragraph 3 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.
 
 (b) Fixed assets have been physically verified by the management during
 the year and no material discrepancies were identified on such
 verification.
 
 (c) The Company has not disposed off any substantial part of the fixed
 assets during the year and the going concern status of the Company is
 not affected.
 
 (ii) As the Company does not have inventory, the Clauses (ii)(a) to
 (ii)(c) of paragraph 4 of the Order are not applicable to the Company.
 
 (iii) (a) As informed, 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 Companies Act, 1956.
 Accordingly, sub-clause (b), (c) and (d) are not applicable.
 
 (b) As informed, the Company has 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.
 Accordingly, sub-clause (f) and (g) are not applicable.
 
 (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 with regard
 to purchase of fixed assets.  The activities of the Company do not
 involve purchase of inventory and the sale of goods. We have not
 observed any major weakness in the internal control system during the
 course of the audit.
 
 (v) According to the information and explanations provided by the
 management, there were no transactions during the year pursuant to the
 contracts or arrangements referred to in section 301 of the Act.
 Accordingly, sub-clause (b) is not applicable.
 
 (vi) The Company has not accepted any deposits under the provisions of
 Section 58A and 58 AA or any other relevant provisions of the Act and
 the Companies (Acceptance of Deposit) Rules, 1957 framed there under.
 
 (vii) In our opinion, the internal audit system of the Company is
 commensurate with its size and nature of its business.
 
 (viii) To the best of our knowledge and as explained, the Central
 Government has not prescribed maintenance of cost records under clause
 (d) of sub-section (1) of section 209 of the Companies Act, 1956 for
 the products of the Company.
 
 (ix) (a) According to the information and explanations given to us, the
 Company is regular in depositing undisputed statutory dues including
 Provident Fund, Employees
 
 State Insurance, Income Tax, Wealth Tax, Sales Tax, Service Tax,
 Customs Duty, Excise Duty, Cess and other statutory dues with
 appropriate authorities 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, 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 information and explanations given to us, the
 following demands as at March 31, 2011 have not been deposited since
 appeals are pending before the relevant Authorities:
 
 Name of      Nature   Amount   Amount      Period to      Forum where
 the statute  of dues (Rupees)  Paid /      which the      dispute is 
                                                             pending
                                adjusted      amount
                                (Rupees)     relates
 
 Income     Income   28,08,018  15,00,000    A.Y.2006-07    Income Tax
 Tax Act,      Tax                                          Appellate 
                                                            Tribunal
 1961                                                       (Mumbai)
 
 Income     Income   27,22,305  27,22,305    A.Y.2007-08    Income Tax
 Tax Act,      Tax                                           Appellate 
                                                             Tribunal
 1961                                                        (Mumbai)
 
 Income     Income   36,15,824        -      A.Y.2008-09  Commissioner
 Tax Act,     Tax                                         of Income Tax
 1961                                                       (Appeals)
 
 (x) The Company has no accumulated losses at the end of the financial
 year and it has not incurred cash losses in the current and immediately
 preceding financial year.
 
 (xi) According to the books of account and records of the Company, no
 amount is due to financial institution or bank or debenture holders.
 
 (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 /
 mutual benefit fund / society. Therefore, the provisions of clause
 4(xiii) of the Companies (Auditors Report) Order, 2003 (as amended)
 are not applicable to the Company.
 
 (xiv) In our opinion and according to the information and explanations
 given to us, the Company has maintained proper records of the
 transactions and contracts in respect of its investments and timely
 entries have been made therein. All the investments have been held by
 the Company in its own name.
 
 (xv) The Company has not given any guarantee for loans taken by others.
 The terms and conditions on which it has pledged its shares as security
 in favour of Lenders for financial assistance given to others are not
 prejudicial to the interest of the Company.
 
 (xvi) The Company did not have any term loans outstanding during the
 year.
 
 (xvii) According to the information and explanations given to us and on
 an overall examination of the balance sheet and cash flow statement of
 the Company, we report that no funds raised on short-term basis have
 been used for long- term investment.
 
 (xviii) During the year, the Company has not made any preferential
 allotment of shares to parties and companies covered in the register
 maintained under Section 301 of the Act.
 
 (xix) The Company did not have any outstanding debentures during the
 year.
 
 (xx) The Company has not raised any money by public issue during the
 year.
 
 (xxi) To the best of our knowledge and belief and according to the
 information and explanations given to us, no material fraud on or by
 the Company was noticed or reported during the year.
 
 
 For SHAH GUPTA & CO
 
 Chartered Accountants
 
 Firm Registration No - 109574W
 
 Heneel K. Patel
 
 Partner
 
 M. No: 114103
 
 Place : Mumbai
 Date  : May 26, 2011