We have audited the attached Balance Sheet of NTC INDUSTRIES LIMITED as
 at 31st March, 2011, the related Profit & Loss Account and 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.
 
 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 management, as well as evaluating the overall financial statement
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 We report that -
 
 1.  We have obtained all the information and explanations, which to the
 best of our knowledge and belief were necessary for the purpose of our
 audit.
 
 2.  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
 these books.
 
 3.  The Balance Sheet, Profit & Loss Account and Cash Flow Statement
 dealt with by this report are in agreement with the Books of Account.
 
 4.  In our opinion, the Balance Sheet, Profit & 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.
 
 5.  On the basis of written representations received from the directors
 as on 31st March, 2011 and taken on record by the Board of Directors,
 we report that none of the directors is disqualified as on 31st March,
 2011 from being appointed as a director in terms of clause (g) of
 sub-section (1) of section 274 of the Companies Act, 1956.
 
 In our opinion and based on the information and according to the
 explanations given to us, the said account read with Notes appearing in
 Schedule 21 give the information required by the Companies Act, 1956 in
 the manner so required and give true and fair view:
 
 a) in the case of Balance Sheet, of the State of Affairs of the Company
 as at 31st March, 2011;
 
 b) in the case of Profit & Loss Account, of the Loss of the Company for
 the year ended on that date; and
 
 c) in the case of the Cash Flow Statement, of the Cash flows for the
 year ended on that date.
 
 As required by the Companies (Auditor''s Report) Order, 2003, as amended
 by the Companies (Auditor''s Report) (Amendment) Order, 2004, issued by
 the Central Government of India in terms of sub-section (4A) of section
 227 of the Companies Act, 1956 and on the basis of such checks of the
 books and records as we considered appropriate and according to
 information and explanations given to us, the matters specified in the
 said order are given hereunder to the extent to which they are
 applicable.
 
 I) a) The Company is maintaining proper records showing, full
 particulars including quantitative details and situation of fixed
 assets.
 
 b) In our opinion, the fixed assets have been physically verified by
 the management at reasonable intervals. No material discrepancies were
 noticed on such verification.
 
 c) The Company has not disposed off any substantial part of its Fixed
 Assets so as to affect its going concern.
 
 ii) a) In our opinion, the inventory of the Company has been physically
 verified by the management at reasonable intervals during the year. In
 respect of material lying with third parties, these have substantially
 been confirmed by them.
 
 b) In our opinion, the procedures of physical verification 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 inventory records, we are of the
 opinion, that the Company is maintaining proper records of inventory.
 The discrepancies noticed on physical verification between the physical
 stocks and the book records were not material.
 
 iii) a) The Company has taken loans from 1 party covered in the
 register maintained under section 301of the Companies Act, 1956. The
 maximum amount involved during the year was Rs. 1,76,80,000/- and the
 year end balance of loan taken from such parties was Rs. 1,47,144/-.
 
 b) The company has given any loan to 1 party listed in the register
 maintained under section 301 of the Companies Act,1956.The maximum
 amount involved during the year was Rs.  38,56,871/- and the year end
 balance of loan given to such parties was Rs. 38,56,871/-.
 
 c) In our opinion, the rate of interest and other terms and conditions
 on which such loan have been taken from companies, farms, other parties
 listed in the register maintained under section 301 are prima facie not
 prejudicial to the interest of the company.
 
 d) The company is regular in repaying the principal amounts as
 stipulated and has also been regular in payment of interest.
 
 e) There is no overdue amount of loans taken from companies, farms,
 other parties listed in the register maintained under section 301 of
 the Companies Act, 1956.
 
 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. Further, on the basis of our examination of the books and
 records of the Company and according to the information and
 explanations given to us, we have neither come across nor have we been
 informed of any continuing failure to correct major weaknesses in the
 aforesaid internal control system.
 
 v) a) In our opinion and according to information and explanations
 given to us, the particulars of contracts or arrangements referred to
 in section 301 of the Companies Act, 1956 have been so entered.
 
 b) In our opinion and according to information and explanations given
 to us, the transactions made in pursuance of contract or arrangements
 entered in the register maintained under section 301 of the Companies
 Act, 1956 and exceeding the value of Rupees Five Lacs in respect of any
 party during the year, have been made at prices which are reasonable
 having regard to the prevailing market prices at the relevant time.
 
 vi) The Company has not accepted any deposits from the public.
 
 vii) In our opinion, the Company has an internal audit system
 commensurate with the size and nature of its business.
 
 viii) According to the information and explanations given to us, 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 and
 the records of the Company examined by us, in our opinion, the Company
 is regular in depositing the undisputed statutory dues including
 Provident Fund, Investor Education and Protection Fund, Employees''
 State Insurance Fund, Income- tax, Sales-tax, Wealth Tax, Service Tax,
 Customs Duty, Excise Duty, Cess and any other material statutory dues
 as applicable with the appropriate authorities.
 
 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 and as far
 as ascertained from the records produced for our verification, the
 particulars of dues in respect of Excise Duty that have not been
 deposited on account of any dispute are as follows:- Amount
 
 Name of the       
 Nature           Nature of 
                  the Dues       Amount      Forum  where  the  dispute
                                                   is  pending
                                 (Rs. in 
                                 Lacs)
 
                                            Assistant/Additional/Deputy
                                            Commissioner,
                Excise duty and             Commissioner, Commissioner
                                            (Appeals),
 Central  
 Excise  Act, 
  1944          interest, penalty 8627.10   Appellate Tribunal & Supreme
                                            Court 
                thereon
 
 x) The Company does not have accumulated losses as at 31st March, 2011
 and it has not incurred any cash losses in the financial year ended on
 that date or in the immediately preceding financial year.
 
 xi) According to the records of the Company examined by us and the
 information and explanations given to us, the Company has not defaulted
 in repayment of dues to any financial institution or bank or debenture
 holders during the year.
 
 xii) In our opinion, the Company has not granted any loans & advances
 on the basis of security by way of pledge of shares, debentures and
 other securities.
 
 xiii) The provisions of any special statue applicable to chit
 fund/nidhi/mutual benefit fund/societies are not applicable to the
 Company.
 
 xiv) In our opinion and according to information and explanations given
 to us, the Company is not dealing in or trading in shares, securities,
 debentures and other investments.
 
 xv) The Company has not given any guarantees for loans taken by others
 from banks or financial institution.
 
 xvi) According to the information and explanations given to us, the
 term loans have been applied for the purpose for which they were
 raised.
 
 xvii) According to the information and explanation given to us and on
 an overall examination of the Balance Sheet of the Company, we report
 that no funds raised on short term basis have been used for long term
 investment by the Company.
 
 xviii)The Company has not made preferential allotment of shares to
 parties and companies covered in register maintained under section 301
 of the Companies Act, 1956 during the year.
 
 xix) The Company has no debentures outstanding at any time during the
 year and hence question of creating security in respect thereof does
 not arise.
 
 xx) As informed to us, the Company has not raised any money by way of a
 public issue during the period covered by our audit report.
 
 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, noticed or reported during the year, nor
 have we been informed of such case by the management.
 
 11, Clive Row, Kolkata: 700 001          For S. M. Daga & Co.
 
 Dated: 30th May, 2011                   Chartered Accountants
 
                                FIRM REGISTRATION NO.  303119E
 
                                                    D.K.  Daga
 
                                                       Partner
                                        Membership  No.  59205