1.  We have audited the attached Balance Sheet of UB Engineering
 Limited, as at March 31, 2011, the related Profit and Loss Account and
 the Cash Flow Statement for the year ended on that date, annexed
 thereto. We have to state that these financial statements are the
 responsibility of the Company''s management and our responsibility is to
 express our opinion on these financial statements is complied with by
 this report based on our audit.
 
 2.  As for the scope and basis for our opinion, we state that we have
 conducted the audit in accordance with the Auditing Standards generally
 accepted in India and obtained reasonable assurance about the financial
 statements being free of material misstatement. Our audit includes,
 wherever necessary, examining, on a test basis, the evidence supporting
 the amounts and disclosures in the financial statements and also
 includes assessing adherence to the accounting principles 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
 issued by the Central Government of India in terms of sub-section (4A)
 of Section 227 of the Companies Act, 1956 and on the basis of such
 checks of the books and records that were considered appropriate and
 the information and explanations given to us during the course of the
 audit, we annex hereto a statement on matters specified in paragraphs 4
 and 5 of the said Order:
 
 Further to our comments referred to above, we report that:
 
 (1) 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;
 
 (2) 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 the
 books.
 
 (3) The Balance Sheet the Profit and Loss Account and the Cash flow
 Statement dealt with by this report are in agreement with the books of
 account.
 
 (4) The Balance Sheet, the Profit and Loss Account and the 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.
 
 (5) On the basis of written representations received from the
 directors, as on March 31, 2011 and taken on record by the Board of
 Directors, we report that none of the directors of the Company is
 disqualified as on March 31, 2011 from being appointed as a director of
 the Company in terms of clause (g) of sub-section (1) of Section 274 of
 the Companies Act, 1956.
 
 (6) In our opinion and to the best of our information and according to
 the explanations given to us, the said Balance Sheet, the Profit and
 Loss Account and the Cash Flow Statement read together with the
 schedules, the notes and accounting policies give the information
 required by the Companies Act, 1956, in the manner so required subject
 to Note No. 8 in the Schedule ''L'' - Notes on Accounts, regarding
 disclosure of expenditure on contracts.
 
 (7) The accounts of Sudan branch have been independently audited by
 M/s. Hassabo & Company. The said accounts are incorporated in the books
 of the Company. We have relied on their report for the purpose of this
 Audit.
 
 (8) As per our opinion, the accounts 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 March 31,2011;
 
 (b) in the case of the Profit and Loss Account, of the profit of the
 Company for the year ended on that date, and
 
 (c) in the case of the Cash Flow Statement, of the cash flows for the
 year ended on that date.
 
 Annexure to the Auditors'' Report
 (Referred to in paragraph 3 of our report of even date)
 
 (i) (a) The Company has maintained proper records showing full
 particulars including quantitative details of fixed assets. As regards
 the fixed assets at sites, the locational details are in the process of
 updation.
 
 (b) Physical verification of certain assets has been carried out in a
 phased manner by the management, which in our opinion is reasonable
 taking into account the nature of the assets and the size of the
 business. We are informed that discrepancies noticed on such
 verification between the physical assets and the book records, are not
 material and have been properly dealt with in the books of account.
 
 (c) As per the information and explanations given to us, the disposals
 of assets during the year were not substantial so as to have an impact
 on the operations of the Company or affect its going concern status.
 
 (ii) (a) The inventory of consumables, stores and spare parts held at
 sites has been physically verified by the management at reasonable
 intervals during the year. In our opinion, the frequency of such
 verification is reasonable.
 
 (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) The Company is maintaining proper records of inventory and as
 explained to us, the discrepancies noticed on verification between
 physical stock and the book records were not material and those have
 been properly dealt with in the books of account.
 
 (iii) (a) As per the information and explanation given to us and the
 records produced to us for our verification, the Company has not
 granted any secured or unsecured loans to companies, firms and other
 parties covered in the register maintained under Section 301 of the
 Companies Act, 1956 and that the reporting requirements of sub-clauses
 (b),(c) and (d) are .therefore, not applicable.
 
 (e) As per the information and explanation given to us and the records
 produced to us for our verification, the Company has not taken any
 secured or unsecured loans from companies, firms and other parties
 covered in the register maintained under Section 301 of the Companies
 Act, 1956 and that the reporting requirements of sub-clauses (f) and
 (g) are, therefore, not applicable.
 
 (iv) In our opinion and according to information and explanations given
 to us, the internal control procedures are generally adequate with
 regard to purchases of inventory and fixed assets and for sale of goods
 and services.
 
 (v) (a) According to the information and explanations given to us, no
 transactions of purchase of goods and materials and sale of goods,
 materials and services were made in pursuance of contracts or
 arrangements required to be entered in the register maintained under
 Section 301 of the Companies Act, 1956.
 
 (b) In view of the remarks under sub-clause (a) above, the reporting
 requirement under this sub-clause is not applicable.
 
 (vi) According to the information and explanations given to us and as
 shown by the books of accounts, the Company has no Public Deposits and
 hence the provisions of Section 58A of the Companies Act, 1956 are not
 applicable.
 
 (vii) Internal Audit is being carried out by the UB Group Internal
 Audit Department, the scope and coverage of which, in our opinion, is
 commensurate with the size and nature of its business.
 
 (viii) Maintenance of cost records under Section 209 (l)(d) of the
 Companies Act, 1956 is not applicable to the Company.
 
 (ix) (a) (1) As part of the Company''s work is carried out at various
 sites and collection of data regarding Provident Fund dues takes time,
 it is the practice of the Company to deposit a lump sum amount against
 these dues and adjust the excess or deficit payments periodically after
 ascertaining details.
 
 The Company has generally been regular in depositing Provident Fund
 dues with the appropriate authorities.
 
 (2) As informed to us, the provisions of Employees'' State Insurance
 (E.S.I.) Scheme are not applicable to the Company except in respect of
 nine sites where the Company has generally been regular in depositing
 E.S.I. dues with the appropriate authorities.
 
 (3) The Company has generally been regular in depositing undisputed
 statutory dues including Income Tax, Sales Tax, Wealth Tax, Service
 Tax, Central Sales Tax, Customs Duty, Excise Duty, Cess and other
 statutory dues with the appropriate authorities. According to the
 information and explanations given to us, there were no undisputed
 amounts of statutory dues, which have remained outstanding as at March
 31, 2011 for a period exceeding six months from the date those became
 payable with the exception of Profession Tax Rs. 0.02 Million
 (subsequently paid) and Employee''s Deposit Linked Insurance Rs. 5.69
 Million relating to earlier years.
 
 (b) According to the information and explanations given to us, details
 of the amounts due on account of dispute in respect of Sales Tax and
 Income Tax dues as of March 31, 2011, have not been deposited with the
 authorities and the forum where the disputes are pending as given
 below:
 
 Sr.  Pariculars            Nature of the     Financial Year to
 No.                        Dues              which the Amounts
                                              Relate
 
 1    Kuwait Tax Liability  Income Tax        1996 -1999
 
 2    Sales Tax             Sales Tax         1987-2007
 
 3    Sales Tax Deferral    Sales Tax         1987-1994 
      Scheme
 
 4    Income Tax            Income Tax        2008-09
 
                                              2007-08
 
 Pariculars             Amount           Forum where
                        Outstanding      dispute is
                        (Rs. Million)    pending
 
 Kuwait Tax Liability    44.56           Honorable Kuwait Court
 
 Sales Tax              111.85           Sales Tax Appellate
                                         Authorities in Various States
 
 Sales Tax Deferral      53.86           High Court, Mumbai
 Scheme
 
 Income Tax               4.98           Commissioner of Income 
                          0.44           Tax, Pune
 
 (x) For current financial year ended March 31, 2011 the Company has not
 incurred cash losses. There was no cash loss in the immediately
 preceding financial year.
 
 (xi) According to information and explanations given to us, there are
 no defaults on payments to banks / financial institutions as on March
 31, 2011.
 
 (xii) In our opinion and according to the information and explanations
 given to us, the Company has not granted loans and advances on the
 basis of security by way of pledge of shares, debentures and other
 securities.
 
 (xiii) The Company is not a chit fund / nidhi / mutual benefit fund /
 society.
 
 (xiv) According to the information and explanations given to us, the
 Company is not dealing or trading in shares, securities, debentures and
 other investments.
 
 (xv) According to the information and explanations given to us, the
 Company has not given any guarantees for loans taken by others, from
 bank or financial institutions.
 
 (xvi) According to the information and explanations given to us, fresh
 term loans have been obtained by the Company during the year from banks
 and in terms of sanction by the respective banks. Term loans are being
 utilized for purchase of strategic equipment and working capital loan
 for regular business activities.
 
 (xvii) On the basis of our examination of the cash flow statement and
 the information and the explanation given to us, the funds raised on
 short term basis have not been used for long term investments and vice
 versa.
 
 (xviii) The Company has not made any preferential allotments of shares
 to parties and Companies covered in the register maintained under
 Section 301 of the Companies Act, 1956.
 
 (xix) The Company has not issued any debentures during the year.
 
 (xx) The Company has not raised any money by public issue during the
 year.
 
 (xxi) During the course of our examination of the books and records of
 the Company, carried out in accordance with the Auditing Standards
 generally accepted in India, we have neither come across any instance
 of fraud on or by the Company, noticed or reported during the year, nor
 have we been informed of such case by the management.
 
 
                                              For M/s. V.P. MEHTA & CO.
                                              CHARTERED ACCOUNTANTS 
                                              (Firm Reg. No. 106326 W)
 
                                               VIPUL P. MEHTA
                                               (PROPRIETOR)
                                               (Mem. No. 35722)
 
 Bangaluru 
 July 06,2011