We have audited the attached Balance Sheet of Pudumjee Industries
 Limited as at 31st March, 2012 and the Profit and Loss Account and Cash
 Flow Statements annexed thereto for the year ended on that date. 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 the auditing standards
 generally accepted in India. These Standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free from any 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 presentation of the
 financial statements. We believe that our audit provides a reasonable
 basis for our opinion.
 
 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 accounts as required by law have
 been kept by the Company so far as appears from our examination of
 those books;
 
 c) In our opinion, the said Balance Sheet, Profit & Loss Account and
 Cash Flow Statement dealt with by this report comply with the
 accounting standards as referred to in Sub-section (3C) of Section 211
 of the Companies Act, 1956;
 
 d) The said Balance Sheet, Profit and Loss Account and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 e) On the basis of information and explanations given to us, and
 representations obtained by the Company and taken on record by the
 Board of Directors, we report that, there are no directors of the
 Company who are disqualified under section 274(1) (g) of the Act, from
 being appointed as directors during the year.
 
 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 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 case of the Balance Sheet, of the state of affairs of the
 Company as at 31st March, 2012;
 
 ii.  In the case of Profit and Loss Account, of the loss 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.
 
 As required by the Companies (Auditor''s Report) Order 2003, issued by
 the Central Government in terms of Section 227(4A) of the Companies
 Act, 1956 and according to the information and explanations given to us
 during the course of the audit and on the basis of such checks as were
 considered appropriate, we further state that
 
 i. a) The Company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets;
 
 b) As explained to us, the fixed assets have been physically verified
 by the Management at the end of the year. It has been reported to us
 that, no material discrepancies have been noticed on such verification;
 
 c) In our opinion, the Company has not disposed of substantial part of
 fixed assets during the year;
 
 ii a) It is reported that, the inventories have been physically
 verified by the management at the end of the year;
 
 b) In our opinion and according to the information and explanations
 given to us, the procedures 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) The Company has maintained proper records of inventories and as
 explained to us there were no material discrepancies noticed on
 physical verification of inventory as compared to the book records;
 
 iii a) The Company has taken unsecured loan aggregating Rs 5903.50 lacs
 during the year from two Companies, covered in the register maintained
 under Section 301 of the Companies Act, 1956.
 
 b) In our opinion and according to the information and explanations
 given to us, the rate of interest and other terms and conditions of
 such loan taken are not prima facie prejudicial to the interest of the
 Company;
 
 c) The payment of the principal amount and interest thereon is also
 regular;
 
 d) There are no overdue amounts in respect of loans taken by the
 Company ;
 
 e) The Company has granted unsecured loan aggregating Rs 1961.55 lacs
 during the year to three Companies and a firm covered in the register
 maintained under Section 301 of the Companies Act, 1956.
 
 f) In our opinion and according to the information and explanations
 given to us, the rate of interest and other terms and conditions of
 such loan taken are not prima facie prejudicial to the interest of the
 Company;
 
 g) The payment of the principal amount and interest thereon is also
 regular;
 
 h) There are no overdue amounts in respect of loans given by 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 inventories, fixed assets and also for the
 sale of goods and services. There are no continuing failure to correct
 major weaknesses in the internal control;
 
 v.  a) According to the information and explanations given to us, the
 transactions that need to be entered in the register maintained U/s 301
 of the Companies Act, 1956, have been so entered;
 
 b) According to the information and explanations given to us, these
 transactions have been made at prices which are reasonable having
 regard to prevailing market prices at the relevant time where such
 market prices are available;
 
 vi.  The Company has not accepted any deposits from the public;
 
 vii The Company has appointed independent internal auditors and in our
 opinion the internal audit system is commensurate with the size and
 nature of its business ;
 
 viii. We have broadly reviewed the records 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
 accounts and records have been made and maintained. However no detailed
 examination of such accounts and records have been carried out by us;
 
 ix a) According to the records of the Company, undisputed statutory
 dues including Provident Fund. Investor Education and Protection Fund,
 Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
 Tax, Custom Duty, Excise Duty, Cess and other outstanding statutory
 dues have been regularly deposited during the year with the appropriate
 authorities.
 
 b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of Income Tax, Wealth Tax,
 Service Tax, Sales Tax, Custom Duty, Excise Duty and Cess were in
 arrears as on 31st March, 2012 for a period of more than six months
 from the date they became payable; 
 
 c) The disputed Statutory dues aggregating Rs 377.33 lacs that have not
 been deposited on account of disputes and matters pending before
 appropriate authorities are as under: -
 
 S.   Nature of the       Forum where                   Amount
 No   Dues                the dispute is                Rs in lacs
                          Pending
 
 1    Excise Duty         CESTAT Mumbai                 151.77
                          (Department''s appeal)
 
 2    Service Tax         CESTAT                          0.38
 
 3    Service Tax         Dy. Commissioner                0.27
                          (Central Excise)
 
 4    Custom Duty         Supreme Court                  43.47
                          (Deptt. Appeals)
 
 5    Excise duty         CESTAT (Deptt. Appeals)         0.26
 
 6    Excise duty         Dy. Commissioner                1.87
                          (Central Excise)
 
 7    Sales Tax           High Court, M. P.             179.31
 
 x.  The Company has no accumulated losses and the Company has not
 incurred cash Loss during the year under report. However, the Company
 has incurred cash loss in the immediately preceding financial year;
 
 xi.  According to the information and explanations given to us, the
 Company has not made any default in repayment of dues to financial
 institutions or banks or debenture holders;
 
 xii. In our opinion and according to the information and explanations
 given to us, the Company has not granted any loans on the basis of
 security by way of pledge of shares debentures and other securities;
 
 xiii The Company is not a nidhi, mutual benefit fund or a society;
 
 xiv The Company is not dealing or trading in shares securities,
 debentures and other investments;
 
 xv The Company has given guarantees for loans and other credit
 facilities taken by others from banks and according to the information
 and explanations given to us, the terms and conditions of such
 guarantees are not prejudicial to the interest of the Company :
 
 xvi According to the information and explanations given to us, the term
 loans were applied for the purpose for which they were obtained;
 
 xvii In our opinion and according to the information and explanations
 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;
 
 
 xviii According to the information and explanations given to us, during
 the year under report the Company has not made any allotment of shares
 to any person;
 
 xix According to the information and explanations given to us the
 Company has not issued any debentures and hence the question of
 creating security or charge therefore does not arise;
 
 xx During the year under report, no public issue has been made by the
 Company;
 
 xxi To the best of our knowledge and belief, and according to the
 information and explanations given to us, no fraud on or by the company
 has been noticed or reported during the course of our audit.
 
                                                   For KHARE & CO.
 
                                               Chartered Accountants 
 
                                                    (FRN 105100W)
 
 
 Place : Mumbai,                                    Y. P. SHUKLA
 
 Dated : 29th May, 2012.                             Proprietor
 
                                                Membership No. 16203