1.  We have audited the attached Balance sheet of SIMPLEX PROJECTS LTD.
 as at 31st March, 2010 and also the profit and loss account and the
 cash flow statement for the year ended on that date annexed there to.
 These financial statements are the responsibility of the companys
 management. Our responsibility is to express an opinion on these
 financial statements based on our audit.
 
 2.  We conducted our audit in accordance with the 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 (Auditors Report) Order, 2003 and as
 amended by Company (Auditors Report) (Amendment) Order 2004 “the
 order”, issued by the Central Government of India in terms of
 sub-section (4A) of section 227 of the Companies Act, 1956, we set out
 in the Annexure a statement on the matters specified in Paragraph 4 and
 5 of the said order.
 
 4.  We did not audit the financial statement of the foreign branch of
 the Company. These financial statements have been audited by the other
 auditor, whose report have been furnished to us, and our opinion, in so
 far as it relates to the amounts included in respect of the said
 foreign branch, is based solely on the reports of the other auditor.
 
 5.  Further to our comments in the Annexure referred in paragraph 3
 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 purpose 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
 
 (iii) The Balance sheet, Profit & loss account and the cash flow
 statement dealt with by this report are in agreement with the books of
 account.
 
 (iv) In our opinion, the Balance sheet, Profit & loss account 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.
 
 (v) On the basis of written representations received from the
 directors, as on 31st March, 2010 and taken on record by the Board of
 Directors, we report that none of the directors are disqualified as on
 31st March, 2010 from being appointed as a director in terms of clause
 (g) of sub-section (1) of section 274 of the Companies Act, 1956.
 
 (vi) In our opinion and to the best of our information and according to
 the explanations given to us, the said accounts and read together with
 other notes in the schedule subject to note 5 regarding non bifurcation
 of expenses as per part-II of Schedule-VI and note 12 regarding non
 confirmation of debtors, creditors, advance and bank balance of
 Schedule 12 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 31st March, 2010.
 
 (b) In the case of the profit and loss account, of the profit for the
 year ended on the date; and
 
 (c) In the case of the cash flow statement, of the cash flows for the
 year ended on that date.
 
 ANNEXURE TO AUDITORS REPORT
 ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE
 MEMBERS OF M/S. SIMPLEX PROJECTS LIMITED ON THE ACCOUNTS FOR THE YEAR
 ENDED 31st March , 2010.
 
 (i) (a) The company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) Fixed assets have been physically verified by the management during
 the year end which, in our opinion, is reasonable having regard to the
 size of the company and the nature of its assets. No material
 discrepancies were noticed on such verification
 
 (c) According to the information and explanations given to us, No
 substantial part of the fixed assets has been disposed off during the
 year, which has bearing on the going concern assumption.
 
 (ii) (a) The management has conducted physical verification of
 inventory at reasonable intervals during the year.
 
 (b) The procedures of physical verifications of inventory followed by
 the management are, in our opinion, reasonable and adequate in relation
 to the size of the company and the nature of its business.
 
 (c) The Company is maintaining proper records of inventory and no
 material discrepancies were noticed on physical verification.
 
 (iii) (a) According to the information and explanation given to us, the
 company has granted advance in the nature of loans to two parties (a
 subsidiary of the company and Joint Venture) which are covered in the
 register maintained under section 301 of the Companies Act 1956. The
 maximum amount outstanding at any point of time during the year was Rs.
 34,03,12,870/- and the year end balance of the same is Rs.
 32,61,87,415/- (b) According to the information and explanation given
 to us, the loans given to the subsidiary is interest free and payable
 on demand which as per the management is not prejudicial to the
 interest of the company.
 
 (c) According to information and explanation given to us the said
 advances in the nature of loans are repayable on demand and as such
 Clause (iii)(c) & (d) of Companies (Auditors Report) Order, 2003, are
 not applicable to the company.
 
 (d) On the basis of examination of records and according to the
 information and explanations given to us, the company has not taken any
 loans secured or unsecured from the party covered in the registered
 maintained under section 301 of the Companies Act, 1956.
 
 (e) As the company has not taken any loan secured or unsecured from the
 party covered in the register maintained under section 301 of the
 Companies Act, 1956 paragraph (iii) (e),(f) & (g) of Companies
 (Auditors Report) Order, 2003, are not applicable.
 
 (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 with regard to purchases of inventory, fixed assets and for
 the sale of goods/service. Further during the course of our audit, we
 have neither come across nor have we been informed of any instance of
 major weaknesses in internal control procedures.
 
 (v) (a) Based on the audit procedures applied by us and according to
 the information and explanations provided by the management we are of
 the opinion that, transactions that need to be entered into the
 register maintained under Section 301 have been so entered.
 
 (b) In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 arrangements entered in the register maintained u/s. 301 of the
 
 Act and exceeding a value of Rupees five lacs in respect of any party
 during the year have been made at prices which are reasonable having
 regard to prevailing market prices at the relevant time.
 
 (vi) In our opinion and according to the information and explanation
 given to us, the company has complied with the provisions of sections
 58A, 58AA or any other relevant provisions of the Companies Act, 1956
 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to
 the deposits accepted from the public except repayment of a deposit
 before maturity .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 on the Company.
 
 (vii) In our opinion, the company has an internal audit system
 commensurate with its size and nature of its business.
 
 (viii) As explained to us the Central Government has not prof the
 business of the Company.
 
 (ix) (a) According to the information and explanations
 given to us, the company is generally regular in depositing with
 appropriate authorities undisputed statutory dues including provident
 fund, Income tax, sales tax, wealth tax, service tax, custom duty,
 excise duty, cess, Investor Education and Protection fund and other
 statutory dues, as applicable.
 
 (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, Customs duty, Excise duty, Cess, Investor
 Education and Protection fund and other material statutory dues for a
 period of more than six months from the date they became payable were
 outstanding as at 31st March, 2010.
 
 (c) According to the information and explanation given to us, the
 particulars of dues of Income Tax, Service Tax, Sales Tax, VAT and
 Custom Duty which have not been deposited on account of dispute are as
 follows:
 
 Nature of Dues    Period to which the    Amount      Forum where the
 
                   amount relates          (Rs.)      dispute is pending
 
 Service Tax       2000-01 to 2004-05   5,31,24,001   Commissioner of
                                                      Service Tax
 
 Customs Duty           2004-05            1,84,646   Asstt. Commissioner 
                                                      of Customs
 
 Income Tax             2006-07         2,88,95,591   CIT (A)-XII,Kolkata
 
 Sales Tax / VAT        2005-06           49,13,264   Sr. Joint 
                                                      Commissioner
 
                        2006-07                       Commercial Taxes
 
 (x) The Company has neither accumulated losses at 31st March, 2010 nor
 has it incurred any Cash losses during the year and 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, bank or debenture
 holder.
 
 (xii) Based on our examination of documents and records and according
 to the information and explanation given by the management 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) In our opinion, the company is not a chit fund or a nidhi mutual
 benefit fund / society. Therefore the provisions of clause 4(xiii) of
 the Companies (Auditors Report) Order, 2003 are not applicable to the
 company.
 
 (xiv) The Company has maintained proper records of securities and other
 investments, which it has traded in and also in respect of shares and
 other securities, held as investments and the said investments are in
 the name of the Company.
 
 (xv) The company has also given a corporate guarantee to a bank for
 financial assistance in foreign currency extended to its joint venture
 amounting to Rs.2,88,26,560/-. In our opinion and based on the
 information and explanations received, the terms and conditions of
 these guarantees are not prejudicial to the interest of the company.
 
 (xvi) 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.
 
 (xviii)The company has not made any preferential allotment to parties
 and companies covered under register maintained under section 301 of
 the companies Act, 1956, during the year and the question of whether
 the price at which the shares have been issued is prejudicial to the
 interest of the Company does not arise.
 
 (xix) According to the information and explanations given to us, no
 debentures have been issued by the Company during the year.
 
 (xx) Based on the records examined by us, we report that the Company
 has not raised any money from public issue during the year.
 
 (xxi) During the course of our examination of books of accounts carried
 out in accordance with 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 nor have
 we been informed of such case by the management.
 
                                                For Chaturvedi & Company
 
                                        Firm Registration Number-302137E
 
                                                   Chartered Accountants
 
 
                                                            Nilima Joshi
 
 Place : Kolkata                                                 Partner
 
 Dated : 26th May, 2010                              Membership No.52122