We have audited the attached Balance Sheet of Udaipur Cement Works
 Limited as at 30th September 2012, Statement of Profit and Loss and
 also the cash flow statement for the period 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 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 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
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 1.  As required by the Companies (Auditor''s Report) Order, 2003 (as
 amended) 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 of
 the books and records of the company as we considered appropriate and
 according to the information and explanations given to us during the
 course of audit, we enclose in the Annexure, a statement on the matters
 specified in the paragraphs 4 and 5 of the said Order.
 
 2.  Further to our comments in the Annexure referred to in paragraph 1
 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 appears from our examination of those
 books;
 
 c) The Balance Sheet, Statement of Profit and Loss and the Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 d) In our opinion and to the best of our information, Statement of
 Profit and Loss, Balance Sheet and the Cash Flow Statement dealt with
 by this report comply with the accounting standards referred to in
 Section 211 (3C) of the Companies Act, 1956, to the extent applicable.
 
 e) On the basis of written representations received from the directors,
 as on 30th September, 2012 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 30th September, 2012 from being re-appointed as a director of the
 company in terms of the clause (g) of sub- (1) of section 274 of the
 Companies Act, 1956. However all the directors of the company except
 Mr. S.K.Kinra, special director appointed by Hon''bie BIFR & Mr. Ganpat
 Singh, appointed as Additional Director on November 1, 2012 are
 disqualified to be appointed/re- appointed as directors in any other
 public company;
 
 f) Attention is invited to:
 
 (i) Note No. 26 of Notes to Accounts regarding non-provision against
 loans and advances amounting to Rs. 471:84 lacs.
 
 (ii) Note No. 26 of Notes to Accounts regarding pending reconciliation/
 confirmation of balances of debtors and loans and advances considered
 to the extent identified by the management and our inability to comment
 thereon.
 
 We further report that the loss for the period, balance in profit &
 loss account, assets and liabilities as stated are without considering
 the impact of items mentioned in para (f) (i) to (ii) above. Had the
 observation made in para (f) (i) above been considered, loss for the
 period would have been Rs. 1,734.16 lacs (as against reported figure of
 loss for the period of Rs 1262.32 lacs), loans & advances would have
 been Rs. 128.62 lacs fas against reported figure of Rs.  600.46 lacs).
 
 Subject to the foregoing, in our opinion and to the best of our
 information and according to the explanations given to us, the said
 Balance Sheet, Statement of Profit and Loss and the Cash Flow Statement
 read together with the notes thereon, give the information required by
 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:
 
 a) In the case of the Balance sheet, of the state of affairs of the
 Company as at 30th September, 2012;
 
 b) In the case of Statement of Profit and Loss, of the loss for the
 period ended on that date; and
 
 c) In the case of Cash Flow Statement, of the cash flows for the period
 ended on that date.
 
 ANNEXURE TO THE AUDITOR''S
 
 REPORT
 
 [Referred to in Paragraph (1) of the Auditors'' Report of even date to
 the members of Udaipur Cement Works Limited for the year ended
 30.09.2012]
 
 i) a) Records showing full particulars including quantitative details
 and situation of fixed assets have been maintained by the company.
 
 b) Physical verification of fixed assets has been conducted by the
 management according to the programme of physical verification in
 phased manner which in our opinion is reasonable having regard to the
 size of the Company and nature of Fixed Assets during the period. The
 discrepancies noticed on such physical verification were not material.
 
 c) As per information and explanations provided by the management and
 records made available to us, fixed assets disposed off during the
 period were not substantial.
 
 ii) a) Physical verification of inventories has not been conducted by
 the Management during the period as stated in note no. 19 of Notes to
 Accounts.
 
 b) In our opinion and having regard to our comments in Para (ii)(a)
 above, the procedures of physical verification of inventory needs to be
 made adequate in relation to the size of the company and nature of its
 business.
 
 c) On the basis of information and records made available, inventory
 records are maintained (subject to note no. 19 of Notes to Accounts)
 but in the absence of physical verification report, it is not possible
 to ascertain and comment on discrepancy between book records and
 physical inventory and adjustments, if any and ascertainment of amount
 thereof read together with note no. 19 of Notes to Accounts.
 
 iii) The company has neither granted nor taken any loans, secured or
 unsecured '' to and from companies, firms or other parties covered in
 the register maintained under section 301 of the Act. Accordingly, the
 provisions of clause 4(iii) (b) to (d), (f) & (g) of the order are not
 applicable.
 
 iv) Internal control system require to be strengthened to be made
 commensurate with the size of the company and the nature of its
 business for the sale of fixed assets and services and read with our
 comments elsewhere and note no 19 & 26 of Notes to Accounts.
 
 v) According to the information and explanations provided by the
 management and based upon audit procedure performed, we are of the
 opinion that there are no particulars of contracts or arrangements
 referred to in section 301 of the Act to be entered in the register
 required to be maintained under that section, accordingly, the
 provisions of clause 4 (v) (b) of the order are not applicable.
 
 vi) In our opinion and according to the information and explanations
 given to us, the company has not accepted any deposits from the public
 within the meaning of the directives issued by Reserve Bank of India
 and the provision of sections 58A, 58AA or any other relevant
 provisions of the Act and the rules framed there under. As informed to
 us, no order has been passed by the Company Law Board or National
 Company Law Tribunal or Reserve Bank of India or any Court or any other
 Tribunal in this regard.
 
 vii) No Internal Audit has been carried out during the period as stated
 in note no. 28 of Notes to Accounts.
 
 viii) We have broadly reviewed the books of account maintained by the
 company pursuant to the order made by the Central Government for the
 maintenance of cost records under section 209(1) (d) of the Companies
 Act, 1956 and are of the opinion that prima facie, the prescribed
 records have been made and maintained read with Note no. 1.3. We have
 not, however, made a detailed examination of the said records with a
 view to determine whether they are accurate.
 
 ix) a) According to the records of the Company and information and
 explanations given to us, the company is generally regular in
 depositing undisputed statutory dues, Wealth Tax, Service Tax, Custom
 Duty, Cess and other material Statutory dues with the appropriate
 authorities to the extent applicable. There are no material statutory
 dues payable for a period of more than six months from the date they
 became payable as at 30th September, 2012.  
 
 b) According to the records and information and explanations given to
 us,, there are no dues in respect of Wealth Tax, Custom Duty and Cess
 that have not been deposited with the appropriate authorities on
 account of any dispute and the dues in respect of Income Tax, Excise
 Duty, Service Tax and Sales Tax that have not been deposited on account
 of dispute and the forum where the dispute is pending are given below:-
 
 Name of the          Nature of The Dues          Period 
 Statute
 
 Central Excise Act   Excise Duty                 1995-96
 
                      Excise Duty (Interest)      2000-01
 
 Service Tax Act      Service Tax                 1997-98
 
 Sales Tax Act        Sales Tax                   1999-2000 
 
                      Sales Tax (Interest)        1996-97,1997-98 &
                                                  1998-99
 
                      Sales Tax                   1996-97
 
 Land Tax Act         Land Tax                    2006-07 to 2011-12
 
 Above is to be read with note no. 20 of Notes to accounts.
 
 Name of the Statute   Forum where dispute             Amount (In Rs.) 
                       is pending
 
 Central Excise Act    High Court                           4,40,017
 
                       Assistant                            2,81,325
                       Commissioner Central
                       Excise, Udaipur
 
 Service Tax Act       Assistant                           66,05,892
                       Commissioner of Excise (ST.)
 
 Sales Tax Act         Assistant                            8,14,000 
                       Commissioner (Comm, Tax)
 
                       Assistant                            9,11,000
                       Commissioner (Comm. Tax)
 
                       Assistant                           25,04,900
                       Commissioner (Comm. Tax) 
                       Circle ''B'' Jammu
 
 Land Tax Act          Sub-Registrar, Mavli             23,88,69,766
                       & Vallabhnagar
 
 x) The company''s accumulated losses at the end of the period are more
 than fifty percent of its net worth and it has also incurred cash
 losses in the current period and also in the immediately preceding
 financial year.
 
 xi) On the basis of records made available and information and
 explanations given to us, the company has not defaulted in repayment of
 dues, considering the sanction of scheme, to financial institutions,
 banks and debenture holders.
 
 xii) 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.
 
 xiii) The company is not a chit fund or a nidhi/mutual benefit
 fund/society; therefore the provisions of clause 4 (xiii) of the Order
 are not applicable to the company.
 
 xiv) According to the information and explanations provided by the
 management, the company is not dealing in or trading in shares,
 securities, debentures and other investments.
 
 xv) According to the information and explanations given to us, the
 company has not given any guarantee for loans taken by others from
 banks or financial institutions.
 
 xvi) In our opinion and according to the records, information and
 explanations given to us, the Company has not availed any fresh term
 loan during the period.
 
 xvii) Based on the examination of the documents and records made
 available and on the basis of information and explanations given to us
 and on an overall examination of financial statements, we are of the
 opinion that the company has not used funds raised on short-term basis
 for long-term investment.
 
 xviii) According to the information and explanations given to us, the
 company has not made any preferential allotment of shares during the
 period to any parties or companies covered in the register maintained
 under section 301 of the Companies Act, 1956.
 
 xix) According to information & explanations provided by the management
 no debentures have been issued during the period.
 
 xx) The company has not raised any money through a public issue during
 the period.
 
 xxi) Based on the audit procedures performed and on the basis of
 information and explanations provided by the management which have been
 relied upon by us, no fraud on or by the company has been noticed or
 reported during the course of our audit or have been informed by the
 management.
 
                                  For OM PRAKASH S CHAPLOT & CO.  
 
                                          Chartered Accountants
 
                                                   FRN: 000127C
 
                                                   (O.P.CHAPLOT)
 
 Place: Udaipur                                         Partner
 
 Date : 28.12.2012                                  M.No. 10184