1.  We have audited the attached Balance Sheet of SML ISUZU LIMITED
 (the Company) as at March 31, 2011, and the related Profit and Loss
 Account and Cash Flow Statement for the year ended on that date annexed
 thereto, which we have signed under reference to this report. 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 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 (Auditor''s Report) Order, 2003, as
 amended by the Companies (Auditor''s Report) (Amendment) Order, 2004
 (together the Order), issued by the Central Government of India in
 terms of sub-section (4A) of Section 227 of ''The Companies Act, 1956''
 of India (the ''Act'') and on the basis of such checks of the books and
 records of the Company as we considered appropriate and according to
 the information and explanations given to us, we give in the Annexure a
 statement on the matters specified in paragraphs 4 and 5 of the Order.
 
 4.  Further to our comments in the Annexure referred to in paragraph 3
 above, 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 account as required by law have
 been kept by the Company so far as appears from our examination of
 those books;
 
 (c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
 dealt with by this report are in agreement with the books of account;
 
 (d) In our opinion, the Balance Sheet, Profit and 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 Act;
 
 (e) On the basis of written representations received from the
 directors, and taken on record by the Board of Directors, none of the
 directors is disqualified as on March 31, 2011 from being appointed as
 a director in terms of clause (g) of sub-section (1) of Section 274 of
 the Act;
 
 (f) Attention is invited to non provision ofRs.488 lacs in respect of
 MODVAT credit receivable as explained in Note 2 of Schedule N. Had the
 said amount been provided, loans and advances and profit for the year
 would have been lower by the corresponding amount.
 
 The matter referred above was also the subject matter of qualification
 in our audit report on the financial statements for the year ended
 March 31,2010.
 
 (g) In our opinion and to the best of our information and according to
 the explanations given to us, the said financial statements together
 with the notes thereon and attached thereto give, in the prescribed
 manner, the information required by the Act, and subject to our
 comments in para (f) above, 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 March 31, 2011; 
 
 (ii) in the case of the Profit and Loss Account, of the profit 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.
 
 
 
 ANNEXURE TO AUDITORS'' REPORT
 
 Referred to in paragraph 3 of the Auditors'' Report of even date to the
 members of SMLISUZU Limited (formerly Swaraj Mazda Limited) on the
 financial statements for the year ended March 31, 2011
 
 1.  (a) The Company is maintaining proper records showing full
 particulars, including quantitative details and situation, of
 fixed assets.
 
 (b) The fixed assets are physically verified by the Management
 according to a phased programme designed to cover all the items over a
 period of three years which, in our opinion, is reasonable having
 regard to the size of the Company and the nature of its assets.
 Pursuant to the programme, a portion of the fixed assets has been
 physically verified by the Management during the year and no material
 discrepancies between the book records and the physical inventory have
 been noticed.
 
 (c) In our opinion and according to the information and explanations
 given to us, a substantial part of fixed assets has not been disposed
 of by the Company during the year.
 
 2.  (a) The inventory (excluding stocks with third parties) has been
 physically verified by the Management during the year.
 
 In respect of inventory lying with third parties, these have
 substantially been confirmed by them. In our opinion, the frequency of
 verification is reasonable.
 
 (b) In our opinion, the procedures of physical verification of
 inventory 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 the inventory records, in our
 opinion, the Company is maintaining proper records of inventory. The
 discrepancies noticed on physical verification of inventory as compared
 to book records were not material.
 
 3 (a) The Company has not granted any loans, secured or unsecured, to
 companies, firms or other parties covered in the register maintained
 under Section 301 of the Act.  
 
 (b) 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.
 
 4.  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, 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 been
 informed of any continuing failure to correct major weaknesses in the
 aforesaid internal control system.
 
 5.  (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 required to be maintained under that section.  (b) In our
 opinion and according to the information and explanations given to us,
 the transactions made in pursuance of such contracts or arrangements
 and exceeding the value of Rupees Five Lakhs 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.
 
 6.  The Company has not accepted any deposits from the public within
 the meaning of Sections 58A and 58AA of the Act and the rules framed
 there under.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with its size and nature of its business.
 
 8.  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 of India, the maintenance of cost records has been
 prescribed under clause
 
 (d) of sub-section (1) of Section 209 of the Act, and are of the
 opinion that prima facie, the prescribed accounts and records have been
 made and maintained. We have not, however, made a detailed examination
 of the records with a view to determine whether they are accurate or
 complete.
 
 9.  (a) According to the information and explanations given to us and
 the records of the Company examined by us, in our opinion, except dues 
 in respect of income-tax where there have been delays during the year, 
 though the delay in deposit have not been serious, the Company is 
 regular in depositing undisputed statutory dues including investor
 education and protection fund, employees'' state insurance, wealth tax,
 service tax, customs duty, excise duty and other material statutory
 dues as applicable, with the appropriate authorities. The extent of the
 arrears of statutory dues outstanding as at March 31, 2011, for a
 period of more than six months from the date they became payable are as
 follows:
 
 Name of the  Nature of dues Amount (Rs.) Period to which Due date  Date
                                                                     of 
 statute                                  the 
                                          amount                    Paym
                                                                    ent
                                          relates
 
 Income        Witholding     45,000     April-June 2010  July 07,
                                                          2010    May 05
                                                                  ,2011
 Tax Act, 
 1961        Tax on Royalty
 
 (b) According to the information and explanations given to us and the
 records of the Company examined by us, the particulars of dues of
 income-tax, sales-tax, wealth-tax, service-tax, customs duty, excise
 duty and cess as at March 31, 2011 which have not been deposited on
 account of a dispute are as follows:
 
 Name of     Nature of   Amount    Amount    Period to 
                                             which      Forum where the
 the statute  dues     (Rs. lacs)  Deposited 
                                   under     the 
                                             amount     dispute is 
                                                        pending
                                   Protest 
                                  (Rs. Lacs) relates
 
 Central 
 Sales      Sales Tax    218.23     87.30    2000-01    Sales Tax 
                                                        Appellate
 Tax Act, 
 1956                                                   Tribunal, 
                                                        Chandigarh.
 
 Punjab VAT Penalty        3.67      0.92    2007-08    Deputy Excise and
 Act, 2005                                              Taxation 
                                                        Commissioner
                                                        cum Joint Direc
                                                        tor Enforcement,
                                                        Patiala.
 
 Gujrat 
 Sales      Penalty       11.78      2.37     2001-02   Deputy 
                                                        Commissioner
 Tax Act                          (Rs. 9.25 
                                 lacs has               (Appeals), 
                                                         Gujarat.
                                 been given 
                                   as bank
                                 guarantee 
                                    by the
                                  company)
 
 Uttar P
 radesh    Sales Tax      15.94     7.19      1993-94    Additional Comm
                                                         issioner
 Trade Tax                                               (Appeals), 
                                                         Lucknow.
 Act,1948
 
 Central 
 Excise    Excise Duty    81.17     2.12      2000-01 to Commissioner
 (Appeals)/
 Act, 1944 Interest and                        2008-09   Custom Excise
                                                         and
            Penalty                                      Service Tax 
                                                         Appellate
                                                         Tribunal 
                                                         (CESTAT)/ Supre
                                                         me Court.
 
 Income 
 Tax      Income Tax,    380.96    62.00       1986-87,
                                               1991-92   High Court of
                                                         Punjab &
 Act, 
 1961     Interest and                         2004-05,
                                               2005-06   Haryana/lncome
                                                         Tax
          Penalty                              2006-07   Appellate 
                                                         Tribunal/
                                                         Commissioner of
                                                         Income Tax 
                                                         (Appeals).
 
 Finance  Service Tax    35.23     1.30       2002-2008  Commissioner 
                                                         (Appeals)/
 Act, 
 1994     and penalty                                    Custom Excise 
                                                         and
                                                         Service Tax 
                                                         Appellate 
                                                         Tribunal 
                                                         (CESTAT)
 
 10.  The Company has no accumulated losses as at March 31, 2011 and it
 has not incurred any cash losses in the financial year ended on that
 date or in the immediately preceding financial year.
 
 11.  According to the records of the Company examined by us and the
 information and explanation given to us, the Company has not defaulted
 in repayment of dues to any financial institution or bank or debenture
 holders as at the balance sheet date.
 
 12.  The Company has not granted any loans and advances on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 13.  The provisions of any special statute applicable to chit fund /
 nidhi / mutual benefit fund/ societies are not applicable to the
 Company.
 
 14.  In our opinion, the Company is not a dealer or trader in shares,
 securities, debentures and other investments.
 
 15.  In our opinion and according to the information and explanations
 given to us, the Company has not given any guarantee for loans taken by
 others from banks or financial institutions during the year.
 
 16.  The Company has not obtained any term loans.
 
 17.  On the basis of an overall examination of the balance sheet of the
 Company, in our opinion and according to the information and
 explanations given to us, there are no funds raised on a short-term
 basis which have been used for long- term investment.
 
 18.  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 during the year.
 
 19.  The Company has not issued any debentures during the year and
 there are no debentures outstanding as at the year end.
 
 20.  The Company has not raised any money by public issues during the
 year. The Management has disclosed the end use of monies during the
 year, out of public issue raised in the earlier year (Refer Note 25 of
 Schedule N) which has been verified by us.
 
 21.  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 except
 that we have been informed by the management of certain instances of
 theft of components from stores during the year under audit.  Loss due
 to theft amounting to Rs. 7.95 lacs (approx) has been reported to
 investigating agencies and the Company is conducting its own
 assessment. Pending the outcome of these actions the loss has been
 adjusted in the books of account and further adjustments, if any, will
 be made once the investigations are completed.
 
                                      For Price Waterhouse
                                      Firm Registration Number: 301112E
                                      Chartered Accountants
 
                                      V.Nijhawan 
 New Delhi                            Partner
 May 26, 2011                         Membership Number: F87228