Auditor Report of Padmalaya Telefilms Ltd.

Mar 31, 2024

We have audited the accompanying Ind AS Financial Statements of M/s. Padmalaya Telefilms Limited
("the company"), which comprise the Balance Sheet as at March 31 2024, the Statement of Profit and
Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of
Cash Flows for the year then ended, and notes to the financial statements, including a summary of
significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, except
for the effects of the matters described in the ''Basis for Qualified Opinion'' section of our report, the
aforesaid Ind AS Financial Statements give the information required by the Companies Act, 2013 ("the
Act") in the manner so required and give a true and fair view in conformity with the accounting
principles generally accepted in India prescribed under Section 133 of the Act read with the Companies
(Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles
generally accepted in India, of the state of affairs of the Company as at March 31, 2024 and its Loss, total
comprehensive income, changes in equity and its cash flows for the year ended on that date.

Qualified Opinion Paragraph

1. The company has not paid the GST Liability of Rs. 56.06 (in Lakhs) up to 31-03-2024.

2. The company has not submitted physical verification reports of inventory aggregating to Rs.
1313.14 (in Lakhs) as at 31^st March 2024 and we were unable to obtain sufficient &
appropriate audit evidence regarding the physical existence and valuation of inventory. In the
absence of alternative corroborate evidence, we are unable to comment on carrying value of
the inventory and realizable value of the same.

3. The company has not submitted the confirmations of Trade Receivables of Rs. 36.00 (in
Lakhs). In the absence of alternative corroborative evidence, we are unable to comment on
the extent to which such balances are payable or receivable.

We conducted our audit of the Ind AS Financial Statements in accordance with the Standards on Auditing
(SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further
described in the Auditor''s Responsibilities for the Audit of the Ind AS Financial Statements section of our
report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute
of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our
audit of the Ind AS Financial Statements under the provisions of the Act and the Rules made there under,
and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code
of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our qualified audit opinion on the Ind AS Financial Statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance
in our audit of the Ind AS Financial Statements of the current period. These matters were addressed
in the context of our audit of the Ind AS Financial Statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.

Except the matters discussed in the Qualified Opinion paragraph, there are no other key audit
matters be discussed.

Information Other than the Financial Statements and Auditor''s Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information
comprises the information included in the Management Discussion and Analysis, Board''s Report
including Annexure to Board''s Report, Business Responsibility Report, Corporate Governance and
Shareholder''s Information, but does not include the Ind AS Financial Statements and our auditor''s
report thereon.

Our opinion on the Ind AS Financial Statements does not cover the other information and we do not
express any form of assurance conclusion thereon.

In connection with our audit of Ind AS Financial Statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
Ind AS Financial Statements or our knowledge obtained during the course of our audit or otherwise
appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.

Management''s Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with
respect to the preparation of these Ind AS Financial Statements that give a true and fair view of the
financial position, financial performance, including other comprehensive income, changes in equity
and cash flows of the Company in accordance with the Ind AS and other accounting principles generally
accepted in India. This responsibility also includes maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls, that were operating
effectively for ensuring the accuracy and completeness of the accounting records, relevant to the
preparation and presentation of the Ind AS Financial Statements that give a true and fair view and
are free from material misstatement, whether due to fraud or error.

In preparing the Ind AS Financial Statements, management is responsible for assessing the Company''s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless management either intends to liquidate the Company
or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company''s financial reporting
process.

Auditor''s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the Ind AS Financial Statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with SAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these Ind AS Financial Statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Ind AS Financial Statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit
procedures that is appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also
responsible for expressing our opinion on whether the Company has adequate internal financial controls
system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we
conclude that a material uncertainty exists; we are required to draw attention in our auditor''s report to
the related disclosures in the Ind AS Financial Statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s
report. However, future events or conditions may cause the Company to cease to continue as a going
concern.

• Evaluate the overall presentation, structure and content of the Ind AS Financial Statements,
including the disclosures, and whether the Ind AS Financial Statements represent the underlying
transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.

From the matters communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the Ind AS Financial Statements for the financial year ended 31st
March, 2024 and are therefore the key audit matters. We describe these matters in our auditor''s report
unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits
of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order") issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Act, we give in the
Annexure A, a statement on the matters Specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, based on our audit we report that:

a) We have sought and obtained all the information and explanations which to the best of
our knowledge and belief were necessary for the purposes of our audit except for the
points discussed in the Qualified Opinion Paragraph.

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 those books except for the points given in the
Qualified Opinion Paragraph.

c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income,
Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are
in agreement with the relevant books of account.

d) In our opinion, the aforesaid Financial Statements comply with the Ind AS specified under
Section 133 of the Act, read with relevant rules issued there under except for the matters
discussed in the Qualified Opinion Paragraph.

e) On the basis of the written representations received from the directors as on March 31,
2024 taken on record by the Board of Directors, none of the directors is disqualified as on
March 31, 2024 from being appointed as a director in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the
Company and the operating effectiveness of such controls, refer to our separate Report in
"Annexure B". Our report expresses a modified opinion on the adequacy and operating
effectiveness of the Company''s internal financial controls over financial reporting.

g) In our opinion and to the best of our information and according to the explanations given
to us, the remuneration paid by the Company has not paid any remuneration to its
directors during the year.

h) With respect to the other matters to be included in the Auditor''s Report in accordance with
Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to
the best of our information and according to the explanations given to us:

i. The Company does not have pending litigations on its financial position in its Ind AS
Financial Statements.

ii. The Company does not have any long-term contracts including derivative contracts for
which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor
Education and Protection Fund by the Company.

iii. (a) The Management has represented that, to the best of its knowledge and belief,

no funds have been advanced or loaned or invested (either from borrowed funds
or share premium or any other sources or kind of funds) by the Company to or in
any other persons or entities, including foreign entities ("Intermediaries"), with
the understanding, whether recorded in writing or otherwise, that the
Intermediary shall, directly or indirectly lend or invest in other persons or entities
identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of
the Company or provide any guarantee, security or the like on behalf of the
Ultimate Beneficiaries.

(b) The Management has represented that, to the best of its knowledge and belief, no
funds have been received by the Company from any persons or entities, including
foreign entities ("Funding Parties"), with the understanding, whether recorded in
writing or otherwise, that the Company shall directly or indirectly, lend or invest
in other persons or entities identified in any manner whatsoever ("Ultimate
Beneficiaries") by or on behalf of the Funding Parties or provide any guarantee,
security or the like on behalf of the Ultimate Beneficiaries.

(c) Based on the audit procedures performed that have been considered reasonable
and appropriate in the circumstances, nothing has come to our notice that has
caused us to believe that the representations under sub-clause (i) and (ii) of Rule
11(e) contain any material misstatement

iv. The company has not declared or paid any dividend during the year.

For P. Murali & Co.

Chartered Accountants

FRN: 007257S

M.V. Joshi

Partner

M. No: 024784

UDIN No: 24024784BKAUEA6276

Place: Hyderabad

Date: 30-05-2024

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Mar 31, 2015

We have audited the accompanying Standalone financial statements of PADMALAYA TELEFILMS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31,2015, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements:

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the Act') with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with rule 7 of Companies (Accounts) Rules, 2014. This responsibility includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; design, implementation and maintenance of adequate internal financial controls, that are operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility:

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditoLsjudgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements, that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements:

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at 31st March, 2015, its lossand its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements:

1. As required by the Companies (Auditor's Report) Order, 2015 ('the Order") issued by the Central Government of India in terms of sub-section (11) of section143 of the Act, we give in the Annexure a statement on the matters Specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act, we further report that:

a) we have sought and 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 appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid financial statements comply with the applicable Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of written representations received from the directors as on March 31,2015, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2015, from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The company has disclosed the impact of pending litigations as at March 31,2015 on its financial position in its notes to financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the company.

Annexure to Auditors' Report

Annexure referred to in paragraph 1 of Our Report of even date to the members of Padmalaya Telefilms Limitedon the accounts of the Company for the year ended 31st March, 2015 under "Report on other Legal & Regulatory Requirements"

On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of our audit, we report that:

I. (a) The Company has maintained proper records showing full particulars, including quantitativedetails and situation of fixed assets.

(b) As explained to us, fixed assets have been physically verified by the management at regular intervals; as informed to us no material discrepancies were noticed on such verification.

(c) All fixed Assets have been depreciated fully by the end of the financial year and the net block as at 31st March 2015 is Nil except Land.

II. (a) The Inventory has been physically verified during the year by the Management and in our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of the 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, no material discrepancies were noticed on physical verification of stocks as compared to book records.

III. The Company has not granted any loans, secured or unsecured tocompanies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

IV In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets and for the sale of 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, no major weakness has been noticed or reported.

V The Company has not accepted any deposits from the public covered under Section 73 to 76 of the Companies Act, 2013.

VI. In respect of the Company, the Central Government has not prescribed maintenance of cost records under sub-section (1) of Section 148 of the Companies Act, 2013.

VII. (a) According to the information and explanations given to us and based on the records of the Company examined by us, the Company is regular in depositing the undisputed statutory dues, including Provident Fund, Employee Staff Insurance, Service Tax, Sales Tax ,Income-tax and other material statutory dues, as applicable, with the appropriate authorities in India;

(b) There were no undisputed amounts payable in respect of Provident Fund, Employee Staff Insurance, Service Tax, Sales Tax, Income-tax and other material statutory dues in arrears as at 31st March, 2015 for a period of more than 6 months for the date they became payable.

(c) According to the information and explanations given to us and based on the records of the Company examined by us, there are no dues of Provident Fund, Employee Staff Insurance, Service Tax, Sales Tax, Income-tax and other material statutory dues, as applicable, which have not been deposited on account of any disputes.

(d) There are no amounts that are due to be transferred to the Investors Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 [1 of 1956] and rules made there under.

viii. The Company has been registered for a period of not less than 5 years, and its accumulated losses at the end of the financial year are not more than fifty percent of its net worth and the company has not incurred cash losses in this financial year and in the immediately preceding financial year.

ix. In our opinion, and according to the information and explanations given to us, the company has defaulted in repayment of loan to HDFC Banks an amount of Rs. 4.48 crores.The Company has not issuedany debentures.

x. 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, and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company does not arise.

xi. According to the information and explanations given to us, the Company has not obtained any Term Loans during the financial year; hence application of this clause does not arise.

xii. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Companyand no material fraud on the Company has been noticed or reported during the year.

for P. MURALI & CO., Chartered Accountants FRN : 007257S

Sd/- P. MURALI MOHANA RAO Place : Hyderabad Partner Date : 30th May, 2015 Membership No. 23412

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Mar 31, 2014

We have audited the accompanying financial statements of PADMALAYA TELEFILMS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31,2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements:

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility:

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act 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 March 31,2014;

(b) In the case of the Profit and Loss Account, of the loss 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.

Report on Other Legal and Regulatory Requirements:

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, 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 appears from our examination of those books

c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account

d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.;

e) On the basis of written representations received from the directors as on March 31,2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure to Auditors'' Report

I. a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets.

b) As explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

c) The Company has not disposed off substantial part of the Fixed Assets during the year.

II. a) The Inventory has been physically verified during the year by the Management and in our opinion, the frequency of verification is reasonable.

b) In our opinion, the procedures of the 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, no material discrepancies were noticed on physical verification of stocks as compared to book records.

III. 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 Companies Act, 1956.

b) As the Company has not granted any loans, the Clause of whether the rate of interest & other terms and conditions on which loans have been granted to parties listed in the register maintained under Section 301 prejudicial to the interest of company, is not applicable.

c) As no loans are granted by company, the clause of receipt of interest & principal amount from parties, is not applicable to the company.

d) No loans have been granted to Companies, Firms and other parties listed in the register U/S 301 of the Companies Act, 1956. Hence, over due Amount of more than rupees one Lac does not arise and the clause is not Applicable.

e) The Company has not taken any loans, secured or unsecured from Companies, Firms or other Parties covered in the register maintained U/s.301 of the Companies Act, 1956.

f) As the Company has not taken any loans, the clause of whether the rate of interest and other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is prejudicial to the interest of company, is not applicable.

g) As no loans are taken by the company, the clause of repayment of interest & principal amount to parties is not applicable to the company.

IV. In our opinion and according to the information and explanations given to us, there are generally adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods and services. There is no continuing failure by the company to correct any major weaknesses in internal control.

V. a) In our opinion and according to the information and explanation given to us , since no contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been made by the company in respect of any party in the financial year, the entry in the register U/ s.301 of the Companies Act, 1956 does not arise. b) According to the information and explanations given to us, as no such contracts or arrangements made by the company, the applicability of the clause of charging the reasonable price having regard to the prevailing market prices at the relevant time does not arise.

VI. The Company has not accepted any deposits from the public and hence the applicability of the clause of directives issued by the Reserve Bank of India and provisions of section 58A, 58AA or any other relevant provisions of the Act and the rules framed there under does not arise. As per information and explanations given to us the order from the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has not been received by the Company.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of Cost records under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956.

IX. a) The Company is regular in depositing statutory dues including PF, ESI, Income Tax, Cess & other statutory dues with the appropriate authorities and at the end of financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable

b) According to the information and explanations given to us, no disputed amounts are payable in respect of PF, ESI, Income Tax, Cess and any other statutory dues as at the end of the period.

X. The Company has been registered for a period of not less than 5 years, and the company has no accumulated losses at the end of the financial year and the company has not incurred cash losses in this financial year and in the immediately preceding financial year.

XI. According to information and explanations given to us, the company has defaulted in repayment of loan to HDFC Banks an amount of Rs. 4.48 crores.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies.

XIV According to the information and explanations given to us, the company is not dealing or trading in shares, securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order 2003, are not applicable to the Company.

XV 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, and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company.

XVI. According to the information and explanations given to us, the Company has not obtained Term Loans. The utilization of term loan does not arise.

XVII. According to the information and explanations given to us, no funds are raised by the Company on short- term basis. Hence the clause of short term funds being used for long term investment does not arise.

XVIII. According to the information and explanations given to us, the Company has not made any preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is prejudicial to the interest of the Company does not arise.

XIX. According to the information and explanations given to us, the company does not have any debentures and hence the applicability of the clause regarding the creation of security or charge in respect of debentures issued does not arise.

XIX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by public issue is does not arise.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

for P. MURALI & CO., Chartered Accountants FRN : 007257S

P. MURALI MOHANA RAO Place : Hyderabad Partner Date : 30 May, 2014 Membership No. 23412

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Mar 31, 2013

Report on the Financial Statements:

We have audited the accompanying financial statements of M/S PADMALAYA TELEFILMS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement. of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant, accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements:

Management is responsible for tune preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility:

Our responsibility is tp express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. .

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act 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 March 31, 2013; lb) In the case of the Profit and Loss Account, of the loss 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.

Report on Other Legal and Regulatory Requirements:

I . As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, 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 appears from our examination of those books -

(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow-Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

,(e) On the basis of written representations received from the directors as on March 31,2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act,1956

I. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

(c) The Company has not disposed off substantial part of the Fixed Assets during the year.

II. '' (a) The Inventory has been physically verified during the year by the Management and in our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of the 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, no material discrepancies were noticed on physical verification of stocks as compared to book records.

III. (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 Companies Act, 1956.

1 (b) As the Company has not granted any loans, the Clause of whether the rate of interest & other terms and conditions on which loans have been granted to parties listed in the register maintained under Section 301 prejudicial to the interest of company, is not applicable.

(c) As no loans are granted by company, the clause of receipt of interest & principal amount from parties , is not applicable to the company.

(d) No loans have been granted to Companies, Firms and other parties listed in the register U/S 301 of the Companies Act, 1956. Hence, over due Amount of more than rupees one Lac does not arise and the clause is not Applicable.

(e) The Company has not taken any loans, secured or unsecured from Companies, Firms or other Parties covered in the register maintained U/s.301 of the Companies Act, 1956.

(f) As the Company has not taken any loans, the clause of whether the rate of interest and other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is prejudicial to the interest of company, is not applicable.

(g) As no loans are taken by the company, the clause of repayment of interest & principal amount to parties is not applicable to the company.

IV. In our opinion and according to the information and explanations given to us, there are generally adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods and services. There is no continuing failure by the company to correct any major weaknesses in internal control.

V. a) In our opinion and according to the information and explanation given to us, since no contracts or arrangements referred tc in section 301 of the Companies Act, 1956 have been made by the company in respect of any party in the financial year, the entry in the register U/s.301 of the Companies Act, 1956 does not arise.

(b) According to the information and explanations given to us, as no such contracts or arrangements made by the company, the applicability of the clause of charging the reasonable price having regard to the prevailing market prices at the relevant time does not arise.

VI. The Company has not accepted any deposits from the public and hence the applicability of the clause of directives issued by the Reserve Bank of India and provisions of section 58A, 58AA or any other relevant provisions of the Act and the rules framed there underdoes notarise. As per information and explanations given to us the order from the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has not been received by the Company.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of Cost records under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956.

IX. (a) The Company is regular in depositing statutory dues including PF, ESI, Income Tax, Cess & other statutory dues with tne appropriate authorities and at the end of last financial year there were no amounts outstanding which were due for more than 6 months from the date they became payable.

(b) According to the information and explanations given to us, no undisputed amounts are payable in respect of PF, ESI, Income Tax, Cess and any other statutory dues as at the end of the period, for a period more than six months from the date they became payable.

X. The Company has been registered for a period of not less than 5 years, and the company has no accumulated losses at the end of the financial year and the company has not incurred cash losses in this financial year and in the immediately preceding financial year.

XI. According to information and explanations given to us, the company has defaulted in repayment of loan to HDFC Banks an amount of Rs. 4.48 crores.

XII. According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIIL This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies.

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, securities, Debentures and other investments and hence the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order 2003, are not applicable to the Company.

XV 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, and hence the applicability of this » clause regarding terms and conditions which are prejudicial to the interest of the company .

XVI. According to the information and explanations given to us, the Company has not obtained Term Loans. The utilization of term loan does not arise.

XVII. According to the information and explanations given to us, no funds are raised by the Company on short- term basis. Hence the clause of short term funds being used for long term investment does not arise.

XVIII. According to the information and explanations given to us, the Company has not made any preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is prejudicial to the interest of the Company does not arise.

XIX. According to the information and explanations given to us, the company does not have any debentures and hence the applicability of the clause regarding the creation of security or charge in respect of debentures issued does not arise.

XX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by public issue is not applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

for P. MURALI & CO.,

Chartered Accountants

FRN: 007257S

Sd/-

Place: Hyderabad , P. MURALI MOHANA RAO

DaTE : 30th May, 2013 Membership No. 234.2

---

Mar 31, 2012

We have audited the attached Balance Sheet of M/s. PADMALAYA TELEFILMS LIMITED as at March 31,2012 and also the Profit and Loss Account for the period ended on the date annexed thereto and the cash flow statement for the period ended on that date 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 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 statements presentation. We believe that our audit provides a reasonable basis for our opinion.

As required by the Companies (Auditor's Report) Order 2003 and 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, we enclose in the Annexure statement on the matters specified in paragraphs 4 and 5 of the said Order.

Further to our comments in the Annexure referred to the 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 purposes of our audit;

ii) In our opinion, proper books of accounts as required by law have been kept by the Company so for as appears from our examination of those books;

iii) The Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of accounts.

iv) In our opinion, the Balance Sheet, 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;

v) On the basis of written representations received from the directors, as on 31st March, 2012 and taken on record by the record of Directors, we report that none of the directors are disqualified as at March 31,2012 from being appointed Director in terms of clause (g) of sub-section (1) of section 274 of the Compontes Act, 1956;

vi) 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 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, 2012;

b) In the case of the Profit and Loss Account, Loss of the Company for the year ended on that date:

AND

c) In the case of Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Annexure to Auditors' Report

I. a). The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b). The explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been notices on such verification

c) The Company has not disposed off substantial part of the Fixed Assets

II. a). The inventories have been physically verified during the year and in our opinion the frequency of verifications is reasonable.

b). In our opinion, the procedures of physical verification of inventory followed by 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 proper records of Inventory and as explained to us, no material discrepancies were noticed on physical verification of stocks as compared to books records.

III. a). The Company has not granted any loans, secured of unsecured to Companies, Firms or other Parties covered in the register maintained U/s 301 of Companies Ad, 1956.

b). As the Company has not granted any loans, the clause of whether the rate of interest & other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 is prejudicial to the interest of company, is not applicable.

c). As no loans are granted by company, the clause of receipt of interest & principal amount from parties, is not applicable to the company.

d). No loans have been granted to Companies Firm & other parties listed in the register U/s.301 of the Companies Act, 1956, hence overdue amount of more than rupees one lac does not arise and the clause is not applicable.

e). The Company has not taken any loans, secured or unsecured from Companies, Firms or other Parties covered in the register maintained U/s 301 of the Companies Act, 1956.

f). As the Company has not taken any loans, the clause of whether the rate of interests other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is prejudicial to the interest of company, is not applicable.

g). As no loans are taken by the company the clause of repayment interest & principal amount to parties, is not applicable to the company.

IV. In our opinion and according to this information and explanations given to us, there are adequate internal control systems commensurate; with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and services. There is no continuing failure by the company to correct any major weakness in internal control.

V. a) In our opinion and according to the information and explanation given to us, the contracts or arrangements referred to in section 301 of the Companies Act, have been made by the company in respect of the financial year, are entered in register U/s 301 of the Companies Act, 1956 does not arise.

b) According to the information and explanations: given to us, as no such contracts or arrangements made by the company, the applicability of the clause of charging the reasonable price having regards to the prevailing market prices at the relevant time does not arise.

VI. The Company has not accepted any deposits from the public and hence the applicability of the clause of directives issued by the Reserve Bank of India and provisions of Section 58A, 58AA or any other relevant provisions of the Act and the rules framed there under does not arise. As per information and explanations given to us the order from the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has not been received by the Company.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records 7 under clause (d) of sub-section (I) of section 209 of the Companies Act, 1956.

IX. a) The company is regular in depositing statutory dues including PF, ESI, and any other statutory dues with the appropriate authorities and there is no outstanding which was due for more than 6 months from the date they became payable.

b) According to the information and explanations given to us, no undisputed amounts are payable in respect of PF, ESI, and any other statutory dues as at the end of the period, for a period more than six months from the date they became payable.

X. The Company has been registered for a period of not less than 5 years, and the company has accumulated losses at the end of the financial year and the company has incurred cash losses in this financial year and in the immediately preceding financial year.

XI. According to information and explanations given to us, the Company has defaulted in repayment of dues to Banks on Working Capital Loan.

XII. According to the information and explanations given to us, the company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and . hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, securities. Debentures and other investments and hence the provisions of clauses 4(xiv) of the Companies (Auditor's Report) Order 2003, are not applicable to the Company,

XV. 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 institution and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company does not arise.

XVI. According to the information and explanations given to us, Term Loans obtained by the company were applied for the purpose for which such, loans were obtained by the company.

XVII. According to the information and explanations given to us, no funds are raised by the company on short-term basis. Hence the clause of short term funds being used for long-term investment does not arise.

XVIII. According to the information and explanations given. to us the Company has hot made any preferential allotment of Shares to parties and Companies covered in the, Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is prejudicial to the interest of the Company does not arise.

XIX. According to the information and explanations given to us, the company: does not have any debentures and hence the applicability of the clause regarding the creation of security or charge, in respect of debentures issued does not arise.

XX. According to information and explanations given to us, the company Has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year under audit.

for P. MURALI & CO., Chartered Accountants FRN: 007257S

Sd/- P. MURALI MOHANA RAO Partner Membership No. 23412

Place: Hyderabad Date 3rd September, 2012

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Mar 31, 2010

We have audited the attached Balance Sheet of M/s.PADMALAYA TELEFILMS LIMITED as at March 31,2010 and also the Profit and Loss Account for the period ended on the date annexed thereto and the cash flow statement for the period ended on that date 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.

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 statements presentation. We believe that our audit provides a reasonable basis for our opinion.

As required by the Companies (Auditors Report) Order 2003 and as amended by the Companies (Auditors 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, we enclose in the Annexure statement on the matters specified in paragraphs 4 and 5 of the said Order.

Further to our comments in the Annexure referred to the 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 purposes of our audit;

ii) In our opinion, proper books of accounts as required by law have been kept by the Company so for as appears from our examination of those books;

iii) The Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of accounts.

iv) In our opinion, the Balance Sheet, 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;

v) On the basis of written representations received from the directors, as on 31 st March, 2010 and taken on record by the Board of Directors, we report that none of the directors are disqualified as at March 31,2010 from being appointed 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 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 31 st March, 2010;

b) In the case of the Profit and Loss Account, Loss of the Company for the year ended on that date:

AND

c) In the case of Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Annexure to Auditors Report

I. a). The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b). , The explained to us, the fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been notices on such verification

c). The Company has not disposed off substantial part of the Fixed Assets.

II. a). The inventories have been physically verified during the year and in our opinion, the frequency of verifications is reasonable.

b). in our opinion, the procedures of physical verification of inventories followed by management are reasonable and adequate in relation to the size of the Company and the nature of its business.

III. a) The Company has not granted any loans, secured or unsecured to Companies, Firms or other Parties covered in the register maintained U/s.301 of Companies Act, 1956.

b). As the Company has not granted any loans, the clause of whether the rate of interest & other terms and conditions on which loans have been granted to parties listed in the register maintained under section 301 is prejudicial to the interest of company, is not applicable.

c). As no loans are granted by company, the clause of receipt of interest & principal amount from parties, is not applicable to the company.

d). No loans have been granted to Companies, Firm & other parties listed in the register U/s.301 of the Companies Act, 1956, hence overdue amount of more than rupees one lac does not arise and the clause is not applicable.

e). The Company has not taken any loans, secured or unsecured from Companies, Firms or other Parties covered in the register maintained U/s.301 of the Companies Act, 1956.

f). As the Company has not taken any loans, the clause of whether the rate of interest & other terms and conditions on which loans have been taken from parties listed in the register maintained under section 301 is prejudicial to the interest of company, is not applicable.

g). As no loans are taken by the company, the clause of repayment of interest & principal amount to parties, is not applicable to the company.

IV. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. There is no continuing failure by the company to correct any major weaknesses in internal control.

V. a) In our opinion and according to the information and explanation given to us, the contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been made by the company in respect of the financial year, are entered in register U/s.301 of the Companies Act, 1956 does not arise.

b) According to the information and explanations given to us, as no such contracts or arrangements made by the company, the applicability of the clause of charging the reasonable price having regards to the prevailing market prices at the relevant time does not arise.

VI. The Company has not accepted any deposits from the public and hence the applicability of the clause of directives issued by the Reserve Bank of India and provisions of Section 58A, 58AA or any other relevant provisions of the Act and the rules framed there under does not arise. As per information and explanations given to us the order from the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has not been received by the Company.

VII. In our opinion, the company is having internal audit system, commensurate with its size and nature of its business.

VIII. In respect of the Company, the Central Government has not prescribed maintenance of cost records under clause (d) of sub-section (I) of section 209 of the Companies Act, 1956.

IX. a) The company is not regular in depositing statutory dues including PF, ESI, and any other statutory dues with the appropriate authorities and at the last of the financial year there was an amount of Rs. 0.44 Lakhs on account of PF outstanding which was due for more than 6 months from the date they became payable.

b) According to the information and explanations given to us, no undisputed amounts are payable in respect of PF, ESI, and any other statutory dues as at the end of the period, for a period more than six months from the date they became payable expect for Rs. 0.44 lakhs on account of PF.

X. The Company has been registered for a period of not less than 5 years, and it has no accumulated losses at the end of the financial year and the company has incurred cash losses in this financial year and in the immediately preceding financial year.

XI. According to information and explanations given to us, the Company has defaulted in repayment of dues to Banks on Working Capital Loan.

XII. According to the information and explanations given to us, the company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities and hence the applicability of the clause regarding maintenance of adequate documents in respect of loans does not arise.

XIII. This clause is not applicable to this Company as the Company is not covered by the provisions of special statute applicable to Chit Fund in respect of Nidhi/Mutual Benefit Fund/Societies

XIV. According to the information and explanations given to us, the company is not dealing or trading in shares, securities, Debentures and other investments and hence the provisions of clauses 4(xiv) of the Companies (Auditors Report) Order 2003, are not applicable to the Company.

XV 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, and hence the applicability of this clause regarding terms and conditions which are prejudicial to the interest of the company does not arise.

XVI. According to the information and explanations given to us, there is no Term Loan. Hence the application by the company for the purpose for which the loans where obtained does not arise.

XVII. According to the information and explanations given to us, no funds are raised by the company on short-term basis. Hence the clause of short term funds being used for long-term investment does not arise.

XVIII. According to the information and explanations given to us, the Company has not made any preferential allotment of Shares to parties and Companies covered in the Register maintained under section 301 of the Companies Act, 1956 and hence the applicability of the clause regarding the price at which shares have been issued and whether the same is prejudicial to the interest of the Company does not arise.

XIX. According to the information and explanations given to us, the company does not have any debentures and hence the applicability of the clause regarding the creation of security or charge in respect of debentures issued does not arise.

XX. According to information and explanations given to us, the company has not raised money by way of public issues during the year, hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

XXI. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported (during the year under audit.



for P. MURALI & CO.,

Chartered Accountants

Place: Hyderabad

Date 2nd September, 2010 P. MURALI MOHANA RAO

Partner

Membership No. 23412