We have audited the attached Balance Sheet of VIJAY SHANTHI BUILDERS
 LIMITED Chennai as at 31st March 2011 and the Profit and Loss account
 and the Cash Flow Statement of the Company for the year ended on that
 date 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.
 
 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 whether the financial statements
 are free of material misstatements. 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 statements. We believe that our
 audit provides a reasonable basis for our opinion.
 
 1.  As required by the manufacturing and other Companies (Auditor''s
 report) order 2003 and (Amendment) Order 2004 issued by the Company Law
 Board in terms of section 227 (4A) of the Companies Act 1956, and on
 the basis of such checks as we considered appropriate, we enclose in
 the annexure a statement on the matter specified in paragraph 4 and 5
 of the said order.
 
 2.  Further to our comments in the annexure referred to in paragraph 1
 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, the Company, as required by law, has kept proper
 books of accounts so far as appears from our examination of those
 books.
 
 c) The Balance Sheet and Profit and Loss account and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 accounts.
 
 d) In our opinion, the Balance Sheet, Profit and Loss account and Cash
 Flow Statement comply with the Accounting Standards as referred to in
 sec 211(3C) of the Companies Act, 1956.
 
 e) Based on the written representation received from Directors as on
 31st March 2011 and taken on record by the Board of Directors, we
 report that none of the Directors is disqualified as on 31st March 2011
 from being appointed as Director under section 274(1)(g) of Companies
 Act, 1956.
 
 f) 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 Companies Act 1956, in the manner so required and give
 a true and fair view:- In so far as it relates to Balance Sheet, of the
 state of affairs of the Company as at 31st March 2011.
 
 In so far as it relates to the Profit and Loss Account, of the profit
 for the year ended on that date.
 
 And In so far as it relates to cash flow statement, the cash flow of
 the Company for the year ended on that date.
 
 ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE REPORT OF EVEN DATE OF THE
 AUDITORS TO THE MEMBERS OF VIJAY SHANTHI BUILDERS LIMITED ON THE
 ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2011
 
 a) The Company has maintained proper records showing particulars,
 including quantitative details and situation of Fixed Assets.
 
 b) All the assets have been physically verified by the management
 during the year and there is a regular programme of verification which,
 in our opinion, is reasonable having regard to the size of the Company
 and the nature of its assets. No material discrepancies were noted on
 such verification.
 
 c) During the year, the Company has disposed off the fixed assets,
 which are not substantial. According to the information and
 explanations given to us, we are of the opinion that the sale of fixed
 assets has not affected the going concern status of the Company.
 
 II a) The Inventory has been physically verified during the year by the
 management.  In our opinion, the frequency of verification is reasonable.
 
 b) The procedures of physical verification of inventories followed by
 the management are reasonable and adequate in relation to the size of
 the Company and its nature of business.
 
 c) The Company is maintaining proper records of inventory. No
 discrepancies noticed on verification between the physical stocks and
 the book records.
 
 III a) The Company has taken loan from Companies, firms covered in the
 register maintained under section 301 of the Companies Act, 1956.The
 unsecured loan is taken from ten persons and the maximum amount
 outstanding during the year is Rs 49270376/-
 
 b) In our opinion, the terms and conditions on which loans was taken
 from the parties listed in the register maintained under section 301 of
 the Companies act, 1956 are not, prima facie, prejudicial to the
 interest of the Company.
 
 c) There is no stipulation regarding payment of principal amounts and
 interest.
 
 IV a) In our opinion and according to the information and explanation
 given to us, there are adequate internal control procedures
 commensurate with the size of the Company and nature of its business
 with regard to purchase of inventory and assets and with regard to sale
 of goods. During the course of audit, we have not observed any
 continuing failure to correct major weakness in internal controls.
 
 V a) According to the information and explanations given to us, we are
 of the opinion, that the transactions need to be entered into the
 register maintained under section 301 of the Companies Act, 1956 have
 been so entered.
 
 b) In our opinion and according to the information and explanations
 given to us, the transactions made exceeding the value of Rs 5,00,000/-
 with parties maintained under section 301 of the Companies at., 1956
 are not made under any contracts of arrangements but at the price at
 which it is made are reasonable to prevailing market price.
 
 VI a) The company has not accepted any fixed deposits during the year
 in respect of which Section 58A of the Companies Act, 1956 is
 applicable. However the company has taken short term loan which is
 repayable within a period of 11 months.
 
 VII a) In our opinion, the Company has an internal audit system
 commensurate with the size and nature of its business. Outside audit
 firm is doing internal audit and they are giving periodical report to
 the management and it is quiet adequate.
 
 VIII a) The maintenance of cost records has not been prescribed by the
 Central Government under section 209(1) of the Companies Act, 1956
 
 IX a) The Company is regular in depositing with appropriate authorities
 statutory dues including provident fund, investor education and
 protection fund, employee''s state insurance, income tax, sales tax,
 custom duty, excise duty, cess and other material statutory dues
 applicable to it.
 
 b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of income tax, wealth tax, sales
 tax, custom duty, exercise duty and cess were in arrears as at 31st
 March 2011 for a period of more than six months from the date they
 became payable. However the company has not remitted the FBT Tax for
 the financial year 2008-09 of Rs 253895 on the date of signing this
 report,
 
 c) According to the information and explanations given to us, there is
 no undisputed tax pending for payment. However the company has disputed
 tax pending for payment is Rs 151 lacs pertaining the financial year
 2003-04 &2004-05
 
 X a) In our opinion, there is no accumulated loss. The Company has not
 incurred any cash loss during the financial year covered under the
 audit and also immediately preceding financial year.
 
 XI a) According to the information and explanations given to us, the
 Company has not defaulted in repayment of its dues to Banks and
 Financial institutions. The Company has not issued any debentures.
 
 XII a) Based on our examination of the records and of the information
 and explanations given to us, the Company has not granted any loans
 and/or advances on the basis of security by way of pledge of shares,
 debentures or other securities.
 
 XIII a) In our opinion the company is not a chit fund or Nidhi/Mutual
 benefit fund/ Society. Therefore the provisions of clause 4(Xiii) of
 the Companies (Auditor''s Report) Order, 2003 are not applicable to the
 Company.
 
 XIV a) In our opinion, the company is not dealing in or trading in
 shares, securities, debentures and other investments. Accordingly, the
 provisions of clause 4(XVI) of the Companies (Auditor''s Report) Order,
 2003 are not applicable to the Company.
 
 XV a) According to the information and explanation given to us, the
 Company has not given any guarantee for loans taken by others from
 Banks and Financial Institutions.
 
 XVI a) In our opinion, the Company has availed term loan for 55 Crores
 and vehicle loans from ICICI Bank Ltd for Rs 3910385/- during the year
 in addition to previously sanctioned Loans carried over to this year
 and these loans were utilized only for the purpose for which it is
 sanctioned.
 
 XVII a) According to information and explanations 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. No long-term funds have been used to finance short-term
 assets except permanent working capital.
 
 XVIII a) Allotment of shares to the parties was made and it is covered
 in the register maintained under section 301 of the companies Act,
 1956. According to the information and explanations given to us, the
 company has made preferential allotment of 13465070 equity shares of Rs
 10 each at premium of Rs20/- per share. These allotments were made as
 per the High Court Order approving scheme of amalgamation.
 
 XIX a) According to the information and explanations given to us, the
 company has not issued any debentures during the year and hence the
 provisions of clause no 4(XIX) of the Companies (Auditor''s Report)
 Order, 2003 is not applicable to the Company.
 
 XX a) According to the information and explanations given to us, the
 company has not raised the money by way of public issues during the
 year.
 
 XXI a) According to the information and explanations given to us, no
 fraud on or by the company has been noticed or reported during the
 course of our audit.
 
                                                For V.Ramaratnam & Co
                                                Chartered Accountants
                                                            R. Sundar
                                                              Partner
                                        Firm Registration No: 002956S
                                                           PRN 005295
 
 Place   Chennai 
 Date    30.05.2011