1.  We have audited the attached Balance Sheet of National Buildings
 Construction Corporation Limited as at 31st March, 2012 and also the
 Profit & Loss Account and the Cash-Flow Statement 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.
 
 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 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 the Management, as well as evaluating the over- all 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 as
 amended by Companies( Auditors'' Report) (Amendment) order, 2004(
 hereinafter referred to as the order) , 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 books and records of the
 Company as we considered appropriate and according to the explanations
 given to us, we annex hereto a statement on matters specified in
 paragraphs 4 & 5 of the said Order.
 
 4.  Further to our comments in the annexure referred to in paragraph-3
 above and subject to what is stated here in below vide paragraph- (vi),
 we report that:-
 
 i) We have obtained all information and explanations which to the best
 of our knowledge and belief were necessary for the purpose of our
 audit;
 
 ii) In our opinion, proper books of accounts as required by law have
 been kept by the Company in so far as appears from our examination of
 the books;
 
 iii) The Balance Sheet, Profit and Loss Account & Cash Flow Statement
 dealt with by this report are in agreement with the books of accounts;
 
 iv) In our opinion, Balance Sheet, Profit & Loss Account and Cash Flow
 Statement have been drawn in accordance with the Accounting Standards
 referred to clause 3(c) of Section 211 of the Companies Act, 1956;
 
 v) Since Section 274(1)(g) of the Companies Act, 1956 is not applicable
 to the Government Companies, as per Notification No. GSR 829(E) dated
 21/10/2003 issued by Department of Companies Affairs; we have no
 comments regarding disqualification for appointment of directors;
 
 vi) Further to our comments above, we are unable to ascertain and
 report the impact on the state of affairs/profitability on account of
 the following:-
 
 a) Offices/projects outside India have not been visited by us. As per
 the information given to us, some works have been performed under
 overseas projects during the year. Exchange fluctuation and other
 income/ expenditure transactions have taken place in respect of such
 Overseas Projects and the same has been accounted for. Investment in
 respect of such foreign project has been incorporated based on the
 records available at Head Office and as certified by the Management.
 
 b) Adjustments that may arise on account of reconciliation and final
 settlement of accounts with various Clients, PRWs, Suppliers and others
 (Refer Note No. 4 of Notes on Financial Statements).
 
 c) There are outstanding dues on account of book debts amounting to Rs.
 5858.36 lakhs (previous year Rs. 4045.37 lakhs) in respect of closed
 inland projects, which are more than three years old including an
 amount of Rs. 1742.30 lakhs (previous year Rs. 1756.18 lakhs) under
 litigation/arbitration. The same have been shown as good for recovery
 (Refer Note No. 12 of Notes on Financial Statements).
 
 d) Balances of trade receivables, trade payables and loans and advances
 are subject to reconciliation and confirmation (Refer Note No. 35 of
 Notes on Financial Statements).
 
 e) Investment towards equity participation of NBCC in Joint Venture has
 been accounted for on payment /adjustment basis.  The aggregate amount
 of each of the Assets, Liabilities, Income and expenses related to
 interest in Joint Venture has not been incorporated (Refer Note No. 9A
 of Notes on Financial Statements).
 
 f) The Company has written-back certain old unclaimed credit balances
 of Rs. 1308.71 lakhs (previous year Rs. 404.03 lakhs) based on review/
 assessment done by the management (Refer Note No. 21 of Notes on
 Financial Statements).
 
 g) No provision has been made for penal levy amounting to Rs. 1654.93
 lakhs (previous years Rs. 1654.93 lakhs) for guarantee given by the
 government for loans taken by the Corporation in view of issue being
 under dispute though the same has been shown as contingent liability
 (Refer Note No. 31 of Notes on Financial Statements ).
 
 Subject to what is stated in paragraph 4 (vi) (a) to (g), in our
 opinion and to the best of our information and according to the
 information and explanations given to us, the said accounts, read with
 notes to financial statements, give a true and fair view in conformity
 with the Accounting Principles generally accepted in India:-
 
 a) In the case of Balance Sheet, of the state of affairs of the Company
 as at 31st March 2012.
 
 b) In the case of Profit & Loss Account, of the profit of the company
 for the year ended on that date; and
 
 c) In the case of the Cash-Flow statement, of the cash flow for the
 year ended on that date.
 
 ANNEXURE TO THE AUDITORS'' REPORT
 
 (Referred to in Paragraph ''3'' of the Auditors'' Report of even date)
 
 i) (a) In terms of information and explanations given to us and the
 books and records examined by us in the normal course of audit, we
 report that, the Company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) According to the information and explanations given to us, there is
 a regular programme of verification of fixed assets, which in our
 opinion, is reasonable having regard to the size of the Company and the
 nature of its assets. Fixed assets have been physically verified by the
 management during the year and no material discrepancies were noticed
 on such verification.
 
 c) The Company has not disposed off any substantial part of its fixed
 assets during the year, which may have any impact on the going concern
 nature of the company.
 
 ii) a) According to information and explanations given to us,
 inventories have been physically verified during the year by
 management, except those lying with outside parties or under custody of
 clients.
 
 b) In our opinion and according to the explanations provided to us, the
 procedures adopted for physical verification of inventory are
 reasonable and adequate in relation to the size of the company and the
 nature of its business.
 
 c) The company has generally maintained proper records of inventory.
 The discrepancies noticed on physical verification of inventory as
 compared to book records were not material and these have been properly
 dealt with in the books of accounts.
 
 iii) a) The Company has not granted any loans, secured or unsecured
 from companies, firms or other parties covered in the register
 maintained under section 301 of the Act. Therefore, the provisions of
 sub-clauses (a), (b), (c) and (d) of clause 4(iii) of the order are not
 applicable to the company.
 
 b) The Company has not taken any loans, secured or unsecured to
 companies, firms or other parties covered in the register maintained
 under section 301 of the Act. Therefore, the provisions of sub-clauses
 (a), (b), (c) and (d) of clause 4(iii) of the order are not applicable
 to the company.
 
 iv) 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 the purchase of inventory and fixed assets and for the
 sale of goods. During the course of our audit, we have not observed any
 continuing major weakness in such internal controls.
 
 v) Based on the audit procedures applied by us and according to the
 information and explanations given to us, there are no transactions
 that need to be entered into a register in pursuance of Section 301 of
 the Act. Accordingly, clause 4(v) (b) of the Order is not applicable to
 the Company.
 
 vi) The Company has not accepted any deposits from the public under the
 provisions of Section 58A and 58AA of the Companies Act, 1956 and the
 rules framed there under.
 
 vii) On the basis of the internal audit reports broadly reviewed by us,
 we are of the opinion that, the coverage of internal audit system
 carried out by the firms of Chartered Accountants appointed by the
 management and by the Internal Audit department of the company, has
 further scope for improvement to commensurate with the size of the
 company and the nature of its business.
 
 viii) Cost records have been prescribed by the Central Government under
 clause(d) of Sub Section (I) of Section 209 of Act.  However as NBCC is
 engaged in contracting or sub-contracting activities and is paid only
 the job work or conversion charges the company is not covered under
 Companies(Cost Accounting Records) Rules 2011.
 
 ix) a) According to the information and explanations given to us and
 the records of the Company examined by us, we are of the opinion that,
 statutory dues like Sales Tax/Value Added Tax, Income Tax, Provident
 fund, Wealth Tax, Service Tax, Custom Duty, Labour Welfare Cess and
 other material statutory dues applicable to the company, have been
 generally regularly deposited during the year with the appropriate
 authorities subject to an exception of undeposited amount of Labour
 Welfare Cess to the tune of Rs. 1996.27 lakhs disclosed in Note 6 of the
 Notes to financial statements under the head other Current Liabilities.
 According to the information and explanations given to us, no
 undisputed amounts payable in respect of above were in arrears, as at
 March 31, 2012 for the period of more than six months from the date on
 which they became payable except in the case of undeposited amount of Rs.
 1996.27 lakhs pertaining to Labour Welfare Cess as mentioned above. We
 have been informed that the provisions of the Employees State Insurance
 Act are not applicable to the Company.
 
 b) According to the information and explanations given to us and the
 records of the company examined by us, the particulars of dues of
 sales-tax, income-tax & service tax, as at 31st March, 2012 which have
 not been deposited on account of a dispute, are as follows:-
 
 Nature of dues          Amount Due (Rs. Lakhs)  (Forum where Lakhs)
                                                  disputes are pending
 
 Sales Tax                     16.26              Sales Tax Board, Jaipur
 
 Income Tax                   514.93              ITAT
 
 Service Tax                 1119.73              CESTAT
 
 Total                       1650.92
 
 x) The company does not have any accumulated losses at the end of the
 financial year and has not incurred cash losses during the financial
 year covered by our audit and the immediately preceding financial year.
 
 xi) According to the information and explanation given to us and the
 records examined by us, the company has not defaulted in repayment of
 dues to Govt. of India, financial institutions, banks or 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 share, debentures and other securities.
 
 xiii) The Company is not a chit fund or a nidhi or a mutual benefit
 society. Therefore, the provisions of sub para (xiii) of para-4 of the
 order are not applicable to the company.
 
 xiv) According to the information and explanations given to us, the
 Company has not dealt/traded in shares, securities, debentures and
 other investments except investments in UTI Liquid Fund Cash Plan and
 lDBI Liquid Fund Cash Plan. In our opinion and according to the
 information and explanations given to us proper records have been
 maintained for the said investments and the same has been held by the
 company, in its own name.
 
 xv) According to the information and explanations given to us, the
 company has not given any guarantee for loans taken by others from bank
 or financial institutions.
 
 xvi) According to the information and explanations given to us there is
 no loan outstanding as at the end of the year. The Company has not
 obtained any term loan during the year.
 
 xvii) According to the information and explanations given to us and on
 an overall examination of the Balance Sheet of the Company, We report
 that the company has not used funds raised on short term basis for long
 term investments.
 
 xviii) According to the information and explanations given to us, the
 company has not made any preferential allotment of shares during the
 year to parties and companies covered in the register maintained under
 Section 301 of the Companies'' Act, 1956.
 
 xix) According to the information and explanations given to us, the
 Company has not issued any debentures during the year and therefore the
 question of creating security in respect thereof does not arise.
 
 xx) According to the information and explanations given to us, the
 Company during the year has not raised any fund by way of public issue.
 
 xxi) During the course of our examination of the books and records of
 the company, carried out in accordance with the generally accepted
 auditing practices in India, and according to the information and
 explanations given to us, we have neither come across any instance of
 fraud on or by the Company, has been noticed or reported during the
 year, nor we have been informed of such case by the Management.
 
                                                    For Amit Ray & Co.,
 
                                                Chartered Accountants 
 
                                               (ICAI Firm No. 000483C)
 
                                                          Amitava Ray
 
 Place : New Delhi                                            Partner
 
 Dated : 29.05.2012                               Membership No. 6947