1.  We have audited the attached Balance Sheet of SARDA PLYWOOD
 INDUSTRIES LIMITED as at 31st March, 2012 and also the Statement of
 Profit and Loss and the Cash Flow Statement for the year ended on that
 date (in which are incorporated the accounts of Company''s branch at
 Delhi audited by other Auditors), 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 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.
 
 3.  As required by the Companies (Auditor''s Report) Order. 2003 issued
 by the Central Government of India in terms of sub-section (4A) of
 Section 227 of the Companies Act, 1956 (the Act), we give 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 above, we
 report that:
 
 (i) 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;
 
 (ii) 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 and proper returns adequate for the purposes of our audit
 have been received from the branches not visited by us. The Branch
 Auditors Reports have been forwarded to us and have been appropriately
 dealt with in this report.
 
 (iii) The Balance Sheet. Statement of Profit and Loss and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 (iv) In our opinion, the Balance Sheet, Statement of Profit and Loss
 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 Act;
 
 (v) On the basis of written representations received from the
 Directors, as on 31st March, 2012, and taken on record by the Board of
 Directors, we report that none of the Directors is disqualified as on
 31st March, 2012 from being appointed as a Director in terms of clause
 (g) of sub-section (1) of section 274 of the Act; 
 
 (vi) 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:
 
 a) in the case of the Balance Sheet, of the state of affairs of the
 Company as at 31st March, 2012.
 
 b) in the case of the Statement of Profit & Loss, of the PROFIT 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 our report of even date to the Members of
 SARDA PLYWOOD INDUSTRIES LIMITED on the accounts for the year ended
 31st March. 2012.
 
 (i) a) The Company is maintaining proper records showing full
 particulars including quantitative details and situation of its fixed
 assets.
 
 b) The fixed assets have been physically verified by the Management
 during the year. To the best of our knowledge, no material
 discrepancies were noticed on such verification.
 
 c) The Company has not disposed of substantial part of fixed assets
 during the year and the going concern status of the Company is not
 affected.
 
 (ii) a) The inventories (excluding stocks with third parties) have been
 physically verified during the year by the Management at reasonable
 intervals. In respect of inventories lying with third parties
 confirmation has been obtained from some of the parties.
 
 b) In our opinion and according to the information and explanations
 given to us. the procedures of physical verification of stocks
 followed by the management are reasonable and adequate in relation to
 the size of the Company and nature of its business.
 
 c) On the basis of our examination, we are of the opinion that the
 Company is maintaining proper records of inventory. No material
 discrepancies were noticed on verification between the physical stocks
 and the book records.
 
 iii) a) The Company has not granted any loan, secured or unsecured, to
 companies, firms or other parties covered in the register maintained
 under section 301 of the Act.
 
 b) As the Company has not granted any loans, secured or unsecured, to
 companies, firms or other parties covered in register maintained under
 section 301 of the Act. clauses (iii)(b) to (iii)(d) of paragraph 4 of
 the said order are not applicable to the Company.
 
 c) 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 Act.
 
 d) As 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 Act. clauses (iii)(f) to (iii)(g) Of paragraph
 4 of the said order are not applicable to the Company.
 
 (iv) On the basis of information and explanation given to us, we are of
 the opinion that the Company has 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
 and according to the information and explanation given to us, we have
 neither come across nor have we been informed of any instances of major
 weaknesses in the aforesaid internal control systems. 
 
 v) a) In our opinion and according to the information and explanations
 given to us, the particulars of contracts or arrangements referred to
 in section 301 of the Act have been entered in the register maintained
 under that section 301.  
 
 b) In our opinion and according to information and explanations given
 to us. the transactions made in pursuance of such contracts or
 arrangements have been made at prices which are reasonable having
 regard to prevailing market prices at the relevant time.  
 
 (vi) The Company has not accepted any deposit within the meaning of
 section 58A, 58AA or any other relevant provisions of the Act and the
 Rules flamed thereunder.
 
 (vii) In our opinion, the internal audit system of the company is
 commensurate with the size of Company and nature of its business.  
 
 (viii) We have broadly reviewed the books of account maintained by the
 company in respect of products where pursuant to the rules made by the
 Central Government, the maintenance of cost records has been prescribed
 under section 209(l)(d) of the Act and are of the opinion that, prima
 facie, the prescribed accounts and records have been made and
 maintained. We. however, as not required, have not made a detailed
 examination of such records.
 
 (ix) a) According to the records, the Company is regular in depositing
 undisputed statutory dues including Provident Fund, Investor Education
 and Protection Fund, Employees'' State Insurance, Income Tax, Wealth
 Tax, Service Tax, Sales Tax, Custom Duty, Excise Duty, Cess and other
 statutory dues with appropriate authorities. According to the
 information and explanations given to us, no undisputed amounts payable
 in respect of the aforesaid dues were outstanding as at 31st March, 2012
 for a period of more than six months from the date of becoming
 payable.
 
 b) The disputed statutory dues aggregating to Rs. 376.41 lacs that have
 not been deposited on account of matters pending before appropriate
 authorities are as under:
 
 SI   Name of the                   Nature             Amount
 No   Statute                       of dues            (Rs. )
 
 1.   Delhi Sales Tax Act, 1975     Sales Tax       77,86,548
 
 2.   Central Sales Tax Act, 1956   Sales Tax       47,51,800
 
 3.   Value Added Tax Act, 2003     Sales Tax     1,16,47,430
 
 4.   Central Sales Tax Act,1956    Sales Tax          70,769
 
 5,   Income Tax Act, 1961          Income Tax         87,429
 
 6.   Central Sales Tax Act, 1956   Sales Tax       13,99,318
 
 7.   Value Added Tax Act, 2003     Sales Tax          99,760
 
 8.   Central Excise Act, 1994      Excise Duty     41,58,216
 
 9.   Central Excise Act, 1994      Excise Duty     78,39,306
 
      TOTAL                                       3,76,40,576
 
 
 
 SI   Name of the                   Period to    Forum where the
 No   Statute                       which the    dispute is pending
                                    amount
                                    relate
 
 1.   Delhi Sales Tax Act, 1975     1990-91      Addl. Commissioner 
                                                 of Sales Tax
 
 2.   Central Sales Tax Act, 1956   1990-91      Addl. Commissioner 
                                                 of Sales Tax
 
 3.   Value Added Tax Act, 2003     2005-06      Dy. Commissioner of
                                                 Sales Tax
 
 4.   Central Sales Tax Act,1956    2005-06      Dy. Commissioner of
                                                 Sales Tax
 
 5.   Income Tax Act, 1961          1985-86      Income Tax Appellate
                                                 Tribunal
 
 6.   Central Sales Tax Act, 1956   2007-08 to   Apple Tribunal, 
                                    2010-11      Ahmedabad.
 
 7.   Value Added Tax Act, 2003     2010-11      Apple Tribunal, 
                                                 Ahmedabad.
 
 8.   Central Excise Act, 1994      April 10 to  Asst. Commissioner
                                    Sept'' 10     of Central Excise
 
 9.   Central Excise Act, 1994      April 10 to  Asst. Commissioner
                                    Sept'' 10     of Central Excise
 
 (x) The Company does not have accumulated losses but has incurred cash
 loss during the year covered by our audit.
 
 (xi) The Company has not defaulted in payment of dues to a financial
 institution or bank. Debentures have not been issued by the Company.
 
 (xii) The Company has not granted loans and advances on the basis of
 security by way of pledge of shares, debentures and similar securities.
 
 (xiii) The provisions of any special statue applicable to Chit Fund.
 Nidhi or Mutual Benefit Society are not applicable to this Company.
 
 (xiv) The Company is not dealing or trading in shares, securities,
 debentures or other investments. However, the investments made by the
 Company in shares and other securities have been held by the Company in
 its own name.
 
 (xv) According to the records of the Company and 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) On the basis of our examination and according to the information
 and explanation given to us, the term loans have been applied for the
 purpose for which the loans were obtained.
 
 (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 funds raised on the short term basis have not been used for long
 term investment.
 
 (xviii) 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 has not issued any secured debentures.
 
 (xx) The Company has not raised any moneys by public issue during the
 period covered by our audit report.
 
 (xxi) To the best of our knowledge and belief and according to the
 information and explanation given to us, no fraud on or by the Company
 has been noticed or reported during the year that causes the financial
 statements materially misstated.
 
 
 
 
                                                For GP. AGRAWAL & CO.  
                                                Chartered Accountants
                                                  (F. R. No. 302O82E)
 
                                               CA. RAKESH KUMAR SINGH 
                                               (Membership No. 66421) 
                                                              Partner
 
 7A, Kiran Shanker Ray Road 
 Kolkata - 700 001
 
 The 29th May 2012