1.  We have audited the attached Balance Sheet of Sujana Towers Limited
 as at 31st March 2011, the Profit and Loss Account and the Cash flow
 Statement for the period of 18 months ended on that date annexed
 thereto. 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 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 issued
 by the Central Government of India in terms of Section 227(4A) of the
 Companies Act, 1956, we enclose in the annexure a statement on the
 matters specified in paragraphs 4 and 5 of the said order to the extent
 they are applicable to the company.
 
 4.  Further to our comments in the annexure referred to 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 purpose of our
 audit.
 
 b) In our opinion, proper books of account as required by law have been
 kept by the company, so far as it appears from our examination of such
 books.
 
 c) The Balance Sheet, Profit and loss account and the cash flow
 statement referred to in this report are in agreement with the books of
 account produced.
 
 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
 Companies Act, 1956.
 
 e) 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 director 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 .
 
 5.  our opinion and to the best of our information and according to the
 explanations given to us, the said accounts read together with the
 notes thereon and schedules attached thereto 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 2011,
 
 ii) in so far it relates to the Profit and Loss account of the Profit
 for the period 18 months ended on that date and
 
 iii) In so far it relates to the Cash flow statement of the Cash flows
 for the period 18 Months ended on that date.
 
 ANNEXURE TO THE AUDITORS REPORT 
 (referred to in paragraph 3 of our report of even date
 
 i.  In respect of its fixed assets:
 
 a.  The company is maintaining records which need to be updated showing
 particulars, including quantitative details and situation of fixed
 assets for the current year additions.
 
 b.  A major portion of the fixed assets have been physically verified
 during the year by the management in accordance with a programme of
 verification, which in our opinion provides for physical verification
 of all the fixed assets at reasonable intervals having regard to the
 size of the Company and nature of its assets.
 
 c.  Substantial part of the Fixed assets have not been disposed off
 during the year affecting going- concern
 
 ii.  In respect of its inventory:
 
 a.  Physical verification of Inventory has been conducted at reasonable
 intervals by the management.
 
 b.  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.  Proper records of inventory have been maintained by the company and
 material discrepancies noticed on Physical verification have been
 properly dealt with in the books of the company.
 
 iii.  (a) During the period under review, the company has not availed
 loans from companies, Firms or other parties listed in the Register
 maintained under section 301 of the Companies Act, 1956.
 
 (b) During the period under review the company has granted interest
 free loan to its subsidiary companies. The balance amount due as at
 31.03.2011 and the maximum amount outstanding during the period
 aggregate to Rs. 15,509.56 Lakhs.
 
 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 purchase of inventory, fixed assets and
 rendering of services. During the course of our audit, no major
 weakness has been noticed in the internal controls.
 
 v.  (a) The particulars of contracts or arrangements referred to
 section 301 of the companies act have not been entered in the register
 required to be maintained under that section.
 
 (b) In the absence of comparative quotations, we are unable to comment
 as to whether the transactions made in pursuance of such contracts or
 arrangements 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 fixed deposits from the public
 during the year requiring compliance of provisions of Section 58 A and
 58 AA or any other relevant provisions of the Companies Act 1956.
 
 vii. The Company has an internal audit system which in our opinion is
 commensurate with the size of the company and the nature of its
 business.
 
 viii. We have broadly reviewed the books of account maintained by the
 company pursuant to section 209(1) (d) of the Companies Act 1956, for
 maintenance of cost records and based on review; we are of the opinion
 that prima facie the prescribed accounts and records are maintained.
 
 ix.  According to the information and explanations given to us in
 respect of statutory dues:
 
 (a) According to the information and explanations given to us, the
 company has been regular except in few cases, in depositing undisputed
 statutory dues including Employees Provident fund, Employees State
 Insurance, Investor protection fund, Income tax, sales tax, wealth tax,
 service tax customs duty excise duty, Cess and any other statutory dues
 with the appropriate authorities during the year.
 
 (b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of income tax ,service tax etc
 were in arrears as at 31.03.2011 for a period of more than
 
 six months from the date they became payable except Income tax of
 Rs.1,813.15 lakhs which is payable for the financial year 2009-10.
 
 (c) According to the information and explanations made available to us
 there are no statutory dues which have not been deposited on account of
 Dispute, with the exception of Excise Duty amounting to Rs.15.49 lakhs
 which is pending before Additional Commissioner of Central Excise.
 
 x. The company does not have has accumulated losses as at 31.03.2011
 and has not incurred cash losses during the current period and also in
 the immediately preceding period covered by audit.
 
 xi. As per the information and explanations made available to us, the
 company has not defaulted in repayment of dues to financial
 institutions or banks.
 
 xii. The company has not granted any loan or advance on the basis of
 Security by way of pledge of shares, Debentures and other securities.
 
 xiii.  The provisions of Special Statute relating to Chit fund/Nidhi
 are not applicable to this company.
 
 xiv.  The company is not dealing in or trading in shares, securities,
 debentures and other investments.
 
 xv. According to the information and explanations given to us, the
 Company has given guarantee to their associate companies Sujana
 Holdings Limited Dubai and Alpha Ventures Limited. The terms and
 conditions of the same are prima facie not prejudicial to the interests
 of the company.
 
 xvi. To the best of our knowledge and belief and according to the
 information and explanation given to us, Term loan availed by the
 company during the current year have been applied for the purposes for
 which the loans were obtained.
 
 xvii. According to the Cash flow statement and other records examined
 by us and based on the information and explanations given to us, on an
 overall basis, funds raised on short term basis have not been used for
 Long term Investment.
 
 xviii. During the year Company has made any preferential allotment of
 shares to parties and companies covered in the register maintained
 under section 301 of the companies act 1956. The prices at which these
 shares are issued are prima facie not prejudicial to the interests of
 the company.
 
 xix.  No debentures have been issued by the Company during the year.
 
 xx. We have verified the end use of money raised by way of issue of
 Global Depository Receipts (GDRs) as disclosed in note 1 of II of
 Schedule 17 of the financial statements.
 
 xxi. To the best of our knowledge and according to information and
 explanations given to us, no fraud on or by the company was noticed or
 reported during the financial year that causes the financial statements
 to be materially misstated.
 
 
 
                                       For M/s. R. Subramanian & Company
                                               Chartered Accountants 
                                                (Reg. No. 004137S)
 
                                                     V. Nalini
                                                     Partner 
                                                Membership No. 208352
 
 Place: Hyderabad (Camp) 
 Dated: 25.05.2011