Auditor Report of Prajay Engineers Syndicate Ltd.

Mar 31, 2025

We have audited the standalone financial statements of Prajay Engineers Syndicate Limited(“the Company) ,Which
comprise the standalone balance sheet as at 31 March 2025, the standalone statement of profit and loss (including other
comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows for the
year than ended, and notes to the standalone financial statements, including a summary of the significant accounting
policies and other explanatory information (hereinafter referred to as “Standalone Financial Statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone
financial statement 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 recognition and measurement principles laid down in the applicable
Indian Accounting Standards, and other accounting principles generally accepted in India, of the state of affairs of the
Company as at 31 March 2025, its profit/loss and other comprehensive income, changes in equity and its cash flows for
the year ended on the date.

Basis for Opinion

We Conducted our audit in accordance with the standards on Auditing (SAs) specified under section 143 (10) of the Act.
Our responsibilities under those SAs are further described in the Auditors’ Responsibilities for the Audit of the Standalone
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 together With the ethical requirements that are relevant to our
audit of the standalone financial statements under the provisions of the Act and Rules 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 opinion.

Emphasis of Matters

We draw attention to below mentioned Notes to standalone annual financial results :

a. Note 41 relating to the Hon’ble NCLT, Hyderabad bench order referring the matter for resolution by way of mediation
to the International Commercial Arbitration and Mediation Centre (IAMC), Hyderabad.

In furtherance to the mediation proceedings pertaining to the disputes between the Investor Entities (i.e. White Stock
Limited & Belclare Limited) and Prajay Entities including Prajay Engineers Syndicate Limited (The Company), The
Settlement Agreement has been executed amongst and by the parties, under the auspices of International Arbitration and
Mediation Centre, (IAMC) Hyderabad and the filing of the compromise terms before the National Company Law Tribunal
(NCLT), Hyderabad has been completed. The cases filed by the Investor Entities before the Hon’ble NCLT Bench,
Hyderabad Bench have accordingly been disposed off.

b. The Government of Andhra Pradesh (Youth Advancement Tourism & Culture Department, now the Government of
Telangana) and the company along with its subsidiary M/s Secunderabad Golf & Leisure Resorts Private Limited, a
special purpose company to develop Golf Course, had entered into Lease Agreement and Construction & Management
agreement. Subsequently, for the issues that arose between the company and the Tourism Department, the Company
invoked the Arbitration clause as per the Agreements and the Hon’ble High Court vide its order dated 28.07.2022
appointed Hon’ble S.M.Rafee (retired District judge) as the Arbitrator in Arbitration Application No.86 of 2022. The
Arbitration proceedings are in progress.

c. Note 39(a) of the Standalone Financial Statements, in respect of trade receivable considered good include an amount
of Rs.8595.11 lakhs due from customers which are outstanding for more than six months. We are unable to
comment on the realization of these receivables in the absence of conformation from the concerned parties. An

amount of Rs.1246.96 Lakhs is set aside towards provision for trade receivables considered as doubtful. During the year
the company has written of bad and doubtful debts to the tune of Rs.1026.22 lakhs.

d. Note 39(b) of the standalone financial statements, in respect of Loans & Advances amounting to Rs.6696.79 lakhs
towards purchase of Land/Development towards certain project of long term nature, and an amount of Rs.956.93
Lakhs given to suppliers, etc. outstanding. We are unable to comment on the realization of
these advances. An amount of Rs.700 Lakhs is set aside towards provision for Advances considered as doubtful.

Our opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgement, were of most significance in our audit of the
standalone financial statements of the current period. These matters were addressed in the context of our audit of the
standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.

Revenue recognition (refer note 3.1 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Revenue from sale of residential and commercial units represents 75.13% of the total revenue from operations of the company. Revenue recognition - Fixed price development contracts The Company inter alia engages in fixed - price development contracts, where, revenue is recognized using the percentage of completion computed as per the input method based on management’s estimate of contract costs ( Refer Note 3.1 to the standalone financial statements). Measurement of revenue recorded over time which is dependent on the estimates of the costs to complete Revenue recognition involves significant estimates related to measurement of costs to complete for the projects. Revenue from projects is recorded based on management’s assessment of the work completed, costs incurred and accrued and the estimate of the balance costs to complete. Due to the inherent nature of the projects and significant judgment involved in the estimate of costs to complete, there is risk of overstatement or understatement of revenue. At Year-end a significant amount of work in progress related to these contracts is recognized on the balance sheet.

Our audit procedures on revenue recognition included the following; • Evaluating that the company’s revenue recognition accounting policies are in line with the applicable Accounting standards and their application to the key customer contracts including consistent application; Sales cut-off procedures for determination of revenue in the current reporting period. • Scrutinizing all the revenue journal entries raised throughout the reporting period and comparing details of a sample of these journals, Which met certain risk-based criteria, with relevant underlying documentation; • Conducting site visits during the year for selected projects to understand the scope and nature of the projects and to assess the progress of the projects and • Considered the adequacy of the disclosures in note 2 & 3 to the standalone financial statement in respect of the judgment taken in recognizing revenue for residential and hospitality sector. In addition, we have the performed the following procedures: Revenue recognition prior to receipt of OC / similar approval and intimation to the customer • Discussing and challenging key management judgments in interpreting contractual terms including obtaining in- house legal interpretations; • Testing sample sales of units for projects with the underlying contracts, completion status and proceeds received from customers; • Identified and tested operating effectiveness of key

controls around approvals of contracts, milestone billing, intimation of possession letters / intimation of receipt of occupation certificate and controls over collection from customers; and • We have obtained confirmations, on a sample basis, from major customers for selected projects to confirm revenue recognized during the year end, performing alternative procedures by comparing details with contracts , collection details and other underlying project related documentation for cases where confirmations are not received.

Measurement of revenue recorded over time which is dependent on the estimates of the costs of complete Compared, on a sample basis, revenue transactions recorded during the year with the underlying contracts, progress reports, invoices raised on customers and collections in bank accounts and whether the related revenue had been recognized in accordance with the Company’s revenue recognition policies; • Identification and testing operating effectiveness of key controls over recording of actual costs incurred for the projects; • Review of the costs to complete workings, comparing the costs to complete with the budgeted costs and inquiring into reasons for variance; and • Sighting approvals for changes in budgeted costs with the rationale for the changes and assessment of contract costs to determine no revenue nature costs are taken to inventory.

Inventories (refer note 11 to standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Inventories comprising of land, construction work in progress, food & beverages represent 32.32% of the Company’s total assets. Assessing net realizable value The Company recognizes profit on each sale by reference to the overall project margin, which is the projected profit percentage for a phase that may comprise multiple units and can last a number of years. The recognition of profit is therefore dependent on the estimate of future selling prices and build costs including an allowance for risk. Further estimation uncertainty and exposure to cyclicality exists within the long term projects. Forecasts of future sales are dependent on market conditions, which can be difficult to predict and be influenced by political and economic factors. Inventory represents the capitalized project costs to date less amounts expensed on sales by reference to the aforementioned projections. It is held at the lower of cost and net realizable value, the latter also being based on the

Our audit procedures to assess the net realizable value (NRV) of inventories included the following: • Discussion with the management to understand the basis of calculation and justification for the estimated recoverable amounts of the unsold units (“the NRV assessment”); • Evaluating the design and implementation of the Company’s internal controls over the NRV assessment. Our evaluation included assessing whether the NRV assessment was prepared and updated by appropriate personnel of the Company and whether the key estimates, including estimated future selling prices and costs of completion for all property development projects, used in the NRV assessment, were discussed and challenged by management as appropriate; • Evaluating the management’s valuation methodology and assessing the key estimates, data inputs and assumptions adopted in the valuations, which included comparing expected future average selling prices with available market data such as recently transacted prices for similar properties

forecast for the project. As such inappropriate assumptions in these forecasts can impact the assessment of the carrying value of inventories. Further, due to their materiality in the context of total assets of the Company this is considered significant to our overall audit strategy and planning.

located in the nearby vicinity of each property development project and the sales budget plans maintained by the Company; • Re-performing the calculations of the NRV assessment and comparing the estimated construction costs to complete each development with the Company’s updated budgets.

Land Advances - (refer note 10 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Assessment of recoverability of land advances Land advance represents a sizeable portion of the Company’s total assets. Land advance represents the amount paid towards procurement of land parcels to be used in the future, for construction of residential projects. These advances are carried at cost less impairment losses, if any. These land advance will be converted into land parcels as per the terms of the underlying contract under which these land advances have been given. To assess the carrying value of land advances, these advances are tested for recoverability by the Company by comparing the valuation of land parcels in the same area for which land advances have been given. Further due to their materiality in the context of total assets of the company this is consider significant to our overall audit.

Our audit procedures to assess the recoverability of land advances included the following; • For our samples, verified the underlying agreements in possession of the Company, based on which land advances were given; • Discussion with the management to understand their plan for conversation of these land advances into land parcels; and • For our samples, verified the valuation reports of land stock.

Investment in subsidiaries and loans to group companies (refer to note 8, 9 and 10 to the standalone financial
statements)

The key Audit Matter

How the matter was addressed in our audit

The carrying amount of the investments in subsidiaries, held at cost represents 12.79%, to associate, represents 5.18% of the Company’s total assets respectively. Recoverability of investment in subsidiary, joint ventures and an associate The Company has investments in subsidiaries, joint ventures and an associate company which are considered to be associated with significant risk in respect of valuation of such investments. These investments are carried at cost less any diminution in value of such investments. In addition, considering the materiality of the investments in subsidiaries, joint ventures and an associate, vis-a-vis the total assets of the Company, this is considered to be significant to our overall audit strategy and planning.

Recoverability of investment in subsidiary, joint ventures and an associate Our audit procedures included: • Comparing the carrying amount of investments with the relevant subsidiaries, joint ventures and associate balance sheet to identify whether their net assets, being an approximation of their minimum recoverable amount, were in excess of their carrying amount and assessing whether those subsidiaries, joint ventures and an associate have historically been profit-making; • For the investments where the carrying amount exceeded the net asset value, comparing the carrying amount of the investment with the projected profitability based on approved business plans of the subsidiaries joint ventures and an associate; • Considering the adequacy of disclosures in respect of the investment in subsidiaries, joint ventures and an associate.

The key Audit Matter

How the matter was addressed in our audit

Recoverability of loans to subsidiaries and joint ventures The Company has extended loans to joint ventures and subsidiaries that are assessed for recoverability at each period end. Financial assets, which include current loans to joint ventures and subsidiaries aggregated to Rs 1646.07 lakhs at 31 March 2025. Due to the nature of the business in the real estate industry, the Company is exposed to heightened risk in respect of the recoverability of the loans and advances granted to the aforementioned related parties. There is also judgment involved as to the recoverability of the working capital and project specific loans, Which rely on a number of property developments being completed over the time period specified in agreements.

Recoverability of loans to subsidiaries and joint ventures Our procedures included: • We reviewed the controls in place for issuing new loans and evidenced the Board/MD approval obtained. We obtained management’s assessment of the recoverability of the loans, which includes cash flow projections over the duration of the loans. These projections are based on underlying property development appraisals; • We tested cash receipts received in relation to these loans during the year through to bank statement; and We have obtained independent confirmations to ensure completeness and existence of loans and advances held by related parties as on 31 March 2025.

Other Information

The Company’s Management and Board of Directors are responsible for the other information. The other information
comprises the information included in the Company’s annual report, but does not include the standalone financial
statements and our auditors’ report there on.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form
of assurance conclusion there on.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the standalone financial statement or
our knowledge obtained in the 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 Standalone Financial Statements

The Company’s Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act,
with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs,
profit/loss and other comprehensive income, changes in equity and cash flow of the Company in accordance with the
accounting principles generally accepted in India, including the Indian Accounting Standards ( Ind AS) specified under
Section 133 of the Act. 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 standalone financial statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.

In preparing the standalone financial statements, Management and Board of Directors are responsible for assessing the
Company’s ability to continue as a going concern , disclosing, as applicable, matters related to going concern and using
the 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.

Board of Directors is also responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibility for the audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditors’ 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 standalone 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 standalone 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 control relevant to the audit in order to design audit procedures that are
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 with reference to financial statements 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
standalone 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 standalone financial statements, including the
disclosures, and whether the standalone 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 standalone financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditors’ 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

As required by the Companies (Auditor’s Report) Order, 2020 (‘the Order’), issued by the Central Government of India in
terms of Section 143(11)of the Act, we give in the “Annexure A”, a statement on the matters specified in paragraphs 3 and
4 of the Order, to the extent applicable.

(A) As required by Section 143(3) of the Act, 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;

(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;

(c) The standalone balance sheet, the standalone statement of profit and loss (including other comprehensive
income), the standalone statement of changes in equity and the standalone statement of cash flows dealt
with by this report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards
(Ind AS) specified under Section 133 of the Act;

(e) On the basis of the written representations received from the directors as on 31 March 2025 taken on
record by the Board of Directors, none of the directors is disqualified as on 31 March 2025 from being
appointed as a director in terms of Section 164 (2) of the act; and

(f) With respect to the adequacy of the internal financial controls with reference to the standalone financial
Statements of the Company and the operating effectiveness of such controls, refer to our separate Report
in “Annexure B”.

(B) With respect to the other matters to be included in the Auditors’ 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 31 March 2025 on its financial position
in

Its standalone financial statements - Refer Note 34 & 41 to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company during the year ended 31 March 2025; and

(iv) 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 borrowing funds or share premium or any other sources or
Kind of funds) by the Company to or in any other person 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 to or 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 Party or

• Provide any guarantee, security or the like from or on behalf of the Ultimate
Beneficiaries.

c) Based on such audit procedures as 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
(iv) (a) and (iv) (b) contain any material mis-statement.

(v) . During the year, the company has not declared any dividend.

(vi) . Based on our examination, which included test checks, the company has used accounting software for

maintaining its books of account for the financial year ended March 31, 2025 which has a feature of
recording audit trail (edit log) facility and the same has been operated throughout the year for all
relevant transactions recorded in the software. Further, during the course of our audit we did not come
across any instance of the audit trail feature being tampered with and the audit trail has been preserved
by the company in accordance with the statutory requirement for record retention.

(C) With respect to the matter to be included in the Auditor’s Report under Section 197(16) of the Act:

In our opinion and according to the information and explanations given to us, the remuneration paid by the
Company to its directors during the current year is in accordance with the provisions of Section 197 of the act. The
Remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry
of Corporate Affairs has not prescribed other details under Section 197(16) of the Act which are required to be
commented upon by us.

For and on behalf of
Karumanchi & Associates

Chartered Accountants

Firm’s registration number : 001753S

Sd/-

N.Gopala Krishna

Partner
M.No : 211124

UDIN No : 25211124BMOAZV8573
Place : Hyderabad
Date : 28.05.2025

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Mar 31, 2024

We have audited the standalone financial statements of Prajay Engineers Syndicate Limited(“the Company) ,Which comprise the standalone balance sheet as at 31 March 2024, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows for the year than ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “Standalone Financial Statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statement give the information required by the Companies Act, 2013 (‘the Act’) in the manner so required an d give a true and fair view in Conformity with the recognition and measurement principles laid down in the applicable Indian Accounting Standards, and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2024, its profit/loss and other comprehensive income, changes in equity and its cash flows for the year ended on the date.

Basis for Opinion

We Conducted our audit in accordance with the standards on Auditing (SAs) specified under section 143 (10) of the Act. Our responsibilities under those SAs are further described in the Auditors’ Responsibilities for the Audit of the Standalone 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 together With the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and Rules 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 opinion.

Emphasis of Matters

We draw attention to below mentioned Notes to standalone annual financial results :

a. Note 41 relating to the Hon’ble NCLT, Hyderabad bench order referring the matter for resolution by way of mediation to the International Commercial Arbitration and Mediation Centre (IAMC), Hyderabad.

In furtherance to the mediation proceedings pertaining to the disputes between the Investor Entities (i.e. White Stock Limited & Belclare Limited) and Prajay Entities including Prajay Engineers Syndicate Limited (The Company), The Settlement Agreement has been executed amongst and by the parties, under the auspices of International Arbitration and Mediation Centre, (IAMC) Hyderabad and the filing of the compromise terms before the National Company Law Tribunal (NCLT), Hyderabad has been completed. The cases filed by the Investor Entities before the Hon’ble NCLT Bench, Hyderabad Bench have accordingly been disposed off.

b. The Government of Andhra Pradesh (Youth Advancement Tourism & Culture Department, now the Government of Telangana) and the company along with its subsidiary M/s Secunderabad Golf & Leisure Resorts Private Limited, a special purpose company to develop Golf Course, had entered into Lease Agreement and Construction & Management agreement. Subsequently, for the issues that arose between the company and the Tourism Department, the Company invoked the Arbitration clause as per the Agreements and the Hon’ble High Court vide its order dated 28.07.2022 appointed Hon’ble S.M.Rafee (retired District judge) as the Arbitrator in Arbitration Application No.86 of 2022. The Arbitration proceedings are in progress.

c. Note 39(a) of the Standalone Financial Statements, in respect of trade receivable considered good include an amount of Rs.11932.34 lakhs due from customers which are outstanding for more than six months. We are unable to comment on the realization of these receivables in the absence of conformation from the concerned parties. An amount of Rs.1246.96 lakhs is set aside towards provision for trade receivables considered as doubtful. During the year the company has written of bad and doubtful debts to the tune of Rs.1029.69 lakhs.

d. Note 39(b) of the standalone financial statements, in respect of Loans & Advances amounting to Rs.6181.23 lakhs towards purchase of Land/Development towards certain project of long term nature, and an amount of Rs.818.13 lakhs given to suppliers, etc. outstanding. We are unable to comment on the realization of these advances. An amount of Rs.700 lakhs is set aside towards provision for Advances considered as doubtful.

e. Note 45 of the standalone financial statements, in respect of Cost of Construction in Inventory includes an amount of Rs.5,62,49,811 /- towards the purchase and development of land at Survey No.361. Shaikpet villiage , Banjara Hills to the extent of Ac 4-26 Gt by registered Sale agreement cum GPA no.1400/2006. Subsequently there was a dispute between the seller and third party, it was admitted before the Supreme Court of India, the suit has been declared in favour of the third party on 21-09-2010. Hence the above said amount could not be realized to the company even after repeated follow up with the seller. On account of this the said amount has been debited to cost of construction.

Our opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue recognition (refer note 3.1 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Revenue from sale of residential and commercial units represents 55.53% of the total revenue from operations of the company. Revenue recognition - Fixed price development contracts The Company inter alia engages in fixed - price development contracts, where, revenue is recognized using the percentage of completion computed as per the input method based on management’s estimate of contract costs ( Refer Note 3.1 to the standalone financial statements). Measurement of revenue recorded over time which is dependent on the estimates of the costs to complete Revenue recognition involves significant estimates related to measurement of costs to complete for the projects. Revenue from projects is recorded based on management’s assessment of the work completed, costs incurred and accrued and the estimate of the balance costs to complete. Due to the inherent nature of the projects and significant judgment involved in the estimate of costs to complete, there is risk of overstatement or understatement of revenue. At Year-end a significant amount of work in progress related to these contracts is recognized on the balance sheet.

Our audit procedures on revenue recognition included the following; • Evaluating that the company’s revenue recognition accounting policies are in line with the applicable Accounting standards and their application to the key customer contracts including consistent application; Sales cut-off procedures for determination of revenue in the current reporting period. • Scrutinizing all the revenue journal entries raised throughout the reporting period and comparing details of a sample of these journals, Which met certain risk-based criteria, with relevant underlying documentation; • Conducting site visits during the year for selected projects to understand the scope and nature of the projects and to assess the progress of the projects and • Considered the adequacy of the disclosures in note 2 & 3 to the standalone financial statement in respect of the judgment taken in recognizing revenue for residential and hospitality sector. In addition, we have the performed the following procedures: Revenue recognition prior to receipt of OC / similar approval and intimation to the customer • Discussing and challenging key management judgments in interpreting contractual terms including obtaining in- house legal interpretations; • Testing sample sales of units for projects with the underlying contracts, completion status and proceeds received from customers; • Identified and tested operating effectiveness of key controls around approvals of contracts, milestone billing, intimation of possession letters / intimation

of receipt of occupation certificate and controls over collection from customers; and • We have obtained confirmations, on a sample basis, from major customers for selected projects to confirm revenue recognized during the year end, performing alternative procedures by comparing details with contracts , collection details and other underlying project related documentation for cases where confirmations are not received.

Measurement of revenue recorded over time which is dependent on the estimates of the costs of complete Compared, on a sample basis, revenue transactions recorded during the year with the underlying contracts, progress reports, invoices raised on customers and collections in bank accounts and whether the related revenue had been recognized in accordance with the Company’s revenue recognition policies; • Identification and testing operating effectiveness of key controls over recording of actual costs incurred for the projects; • Review of the costs to complete workings, comparing the costs to complete with the budgeted costs and inquiring into reasons for variance; and • Sighting approvals for changes in budgeted costs with the rationale for the changes and assessment of contract costs to determine no revenue nature costs are taken to inventory.

Inventories (refer note 11 to standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Inventories comprising of land, construction work in progress, food & beverages represent 33.23% of the Company’s total assets. Assessing net realizable value The Company recognizes profit on each sale by reference to the overall project margin, which is the projected profit percentage for a phase that may comprise multiple units and can last a number of years. The recognition of profit is therefore dependent on the estimate of future selling prices and build costs including an allowance for risk. Further estimation uncertainty and exposure to cyclicality exists within the long term projects. Forecasts of future sales are dependent on market conditions, which can be difficult to predict and be influenced by political and economic factors. Inventory represents the capitalized project costs to date less amounts expensed on sales by reference to the aforementioned projections. It is held at the lower of cost and net realizable value, the latter also being based on the forecast for the project. As such inappropriate assumptions in these forecasts can impact the assessment of the carrying value of inventories. Further, due to their materiality in the context of total assets of the Company this is considered significant to our overall audit strategy and planning.

Our audit procedures to assess the net realizable value (NRV) of inventories included the following: • Discussion with the management to understand the basis of calculation and justification for the estimated recoverable amounts of the unsold units (“the NRV assessment”); • Evaluating the design and implementation of the Company’s internal controls over the NRV assessment. Our evaluation included assessing whether the NRV assessment was prepared and updated by appropriate personnel of the Company and whether the key estimates, including estimated future selling prices and costs of completion for all property development projects, used in the NRV assessment, were discussed and challenged by management as appropriate; • Evaluating the management’s valuation methodology and assessing the key estimates, data inputs and assumptions adopted in the valuations, which included comparing expected future average selling prices with available market data such as recently transacted prices for similar properties located in the nearby vicinity of each property development project and the sales budget plans maintained by the Company; • Re-performing the calculations of the NRV assessment and comparing the estimated construction costs to complete each development with the Company’s updated budgets.

Land Advances - (refer note 10 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Assessment of recoverability of land advances Land advance represents a sizeable portion of the Company’s total assets. Land advance represents the amount paid towards procurement of land parcels to be used in the future, for construction of residential projects. These advances are carried at cost less impairment losses, if any. These land advance will be converted into land parcels as per the terms of the underlying contract under which these land advances have been given. To assess the carrying value of land advances, these advances are tested for recoverability by the Company by comparing the valuation of land parcels in the same area for which land advances have been given. Further due to their materiality in the context of total assets of the company this is consider significant to our overall audit.

Our audit procedures to assess the recoverability of land advances included the following; • For our samples, verified the underlying agreements in possession of the Company, based on which land advances were given; • Discussion with the management to understand their plan for conversation of these land advances into land parcels; and • For our samples, verified the valuation reports of land stock.

Investment in subsidiaries and loans to group companies (refer to note 8, 9 and 10 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

The carrying amount of the investments in subsidiaries, held at cost represents 11.96%, to associate, represents 5.18% of the Company’s total assets respectively. Recoverability of investment in subsidiary, joint ventures and an associate The Company has investments in subsidiaries, joint ventures and an associate company which are considered to be associated with significant risk in respect of valuation of such investments. These investments are carried at cost less any diminution in value of such investments. In addition, considering the materiality of the investments in subsidiaries, joint ventures and an associate, vis-a-vis the total assets of the Company, this is considered to be significant to our overall audit strategy and planning.

Recoverability of investment in subsidiary, joint ventures and an associate Our audit procedures included: • Comparing the carrying amount of investments with the relevant subsidiaries, joint ventures and associate balance sheet to identify whether their net assets, being an approximation of their minimum recoverable amount, were in excess of their carrying amount and assessing whether those subsidiaries, joint ventures and an associate have historically been profit-making; • For the investments where the carrying amount exceeded the net asset value, comparing the carrying amount of the investment with the projected profitability based on approved business plans of the subsidiaries joint ventures and an associate; • Considering the adequacy of disclosures in respect of the investment in subsidiaries, joint ventures and an associate.

The key Audit Matter	How the matter was addressed in our audit
Recoverability of loans to subsidiaries and joint ventures	Recoverability of loans to subsidiaries and joint ventures
The Company has extended loans to joint ventures and subsidiaries that are assessed for recoverability at each period end. Financial assets, which include current loans to joint ventures and subsidiaries aggregated to Rs.2624.67 lakhs at 31 March 2024. Due to the nature of the business in the real estate industry, the Company is exposed to heightened risk in respect of the recoverability of the loans and advances granted to the aforementioned related parties. There is also judgment involved as to the recoverability of the working capital and project specific loans, Which rely on a number of property developments being completed over the time period specified in agreements.	Our procedures included: • We reviewed the controls in place for issuing new loans and evidenced the Board/MD approval obtained. We obtained management’s assessment of the recoverability of the loans, which includes cash flow projections over the duration of the loans. These projections are based on underlying property development appraisals; • We tested cash receipts received in relation to these loans during the year through to bank statement; and We have obtained independent confirmations to ensure completeness and existence of loans and advances held by related parties as on 31 March 2024.

Other Information

The Company’s Management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company’s annual report, but does not include the standalone financial statements and our auditors’ report there on.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion there on.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statement or our knowledge obtained in the 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 Standalone Financial Statements

The Company’s Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act, with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit/loss and other comprehensive income, changes in equity and cash flow of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards ( Ind AS) specified under Section 133 of the Act. 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, Management and Board of Directors are responsible for assessing the Company’s ability to continue as a going concern , disclosing, as applicable, matters related to going concern and using the 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.

Board of Directors is also responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibility for the audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ 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 standalone 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 standalone 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 control relevant to the audit in order to design audit procedures that are 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 with reference to financial statements 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 standalone 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 standalone financial statements, including the disclosures, and whether the standalone 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 standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ 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

As required by the Companies (Auditor’s Report) Order, 2020 (‘the Order’), issued by the Central Government of India in terms of Section 143(11)of the Act, we give in the “Annexure A”, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

(A) As required by Section 143(3) of the Act, 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;

(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;

(c) The standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows dealt with by this report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act;

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

(f) With respect to the adequacy of the internal financial controls with reference to the standalone financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

(B) With respect to the other matters to be included in the Auditors’ 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 31 March 2024 on its financial position in Its standalone financial statements - Refer Note 34 & 41 to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and

Protection Fund by the Company during the year ended 31 March 2024; and

(iv) 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 borrowing funds or share premium or any other sources or Kind of funds) by the Company to or in any other person 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 to or 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 Party or

• Provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries.

c) Based on such audit procedures as 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 (iv) (a) and (iv) (b) contain any material mis-statement.

(v) . During the year, the company has not declared any dividend.

(vi) . Based on our examination, which included test checks, the company has used accounting software for maintaining its books of account for the financial year ended March 31,2024 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all

relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with.

As provision to Rule 3(1) of the Companies (Audit and Auditors) Rules ,2014 is applicable from April 1, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31,2024.

(C) With respect to the matter to be included in the Auditor’s Report under Section 197(16) of the Act:

In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the act. The Remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act which are required to be commented upon by us.

For and on behalf of

Karumanchi & Associates

Chartered Accountants

Firm’s Registration Number : 001753S Sd/-

N.Gopala Krishna

Partner

M.No : 211124

UDIN No : 24211124BKFVWZ5922

Place : Hyderabad

Date : 28.05.2024

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Mar 31, 2023

Prajay Engineers Syndicate Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of Prajay Engineers Syndicate Limited(“the Company) ,Which comprise the standalone balance sheet as at 31 March 2023, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows for the year than ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “Standalone Financial Statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statement 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 recognition and measurement principles laid down in the applicable Indian Accounting Standards, and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2023, its profit/loss and other comprehensive income, changes in equity and its cash flows for the year ended on the date.

Basis for Opinion

We Conducted our audit in accordance with the standards on Auditing (SAs) specified under section 143 (10) of the Act. Our responsibilities under those SAs are further described in the Auditors’ Responsibilities for the Audit of the Standalone 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 together With the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and Rules 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 opinion.

Emphasis of Matters

We draw attention to below mentioned Notes to standalone annual financial results :

a. Note 41 relating to the Hon’ble NCLT, Hyderabad bench order referring the matter for resolution by way of mediation to the International Commercial Arbitration and Mediation Centre (IAMC), Hyderabad.

In furtherance to the mediation proceedings pertaining to the disputes between the Investor Entities (i.e. White Stock Limited & Belclare Limited) and Prajay Entities including Prajay Engineers Syndicate Limited (The Company), The Settlement Agreement has been executed amongst and by the parties, under the auspices of International Arbitration and Mediation Centre, (IAMC) Hyderabad and the filing of the compromise terms before the National Company Law Tribunal (NCLT), Hyderabad has been completed. The cases filed by the Investor Entities before the Hon’ble NCLT Bench, Hyderabad Bench have accordingly been disposed off.

b. The Government of Andhra Pradesh (Youth Advancement Tourism & Culture Department, now the Government of Telangana) and the company along with its subsidiary M/s Secunderabad Golf & Leisure Resorts Private Limited, a special purpose company to develop Golf Course, had entered into Lease Agreement and Construction & Management agreement. Subsequently, for the issues that arose between the company and the Tourism Department, the Company invoked the Arbitration clause as per the Agreements and the Hon’ble High Court vide its order dated 28.07.2022 appointed Hon’ble S.M.Rafee (retired District judge) as the Arbitrator in Arbitration Application No.86 of 2022. The Arbitration proceedings are in progress.

c. Note 39(a) of the Standalone Financial Statements, in respect of trade receivable considered good include an amount of Rs.15099.42 Lakhs due from customers which are outstanding for more than six months. We are unable to comment on the realization of these receivables in the absence of conformation from the concerned parties. An

amount of Rs.1246.96 Lakhs is set aside towards provision for trade receivables considered as doubtful. During the year the company has written of bad and doubtful debts to the tune of Rs.1094.77 lakhs

d. Note 39(b) of the standalone financial statements, in respect of Loans & Advances amounting to Rs.5840.53 lakhs towards purchase of Land/Development towards certain project of long term nature, and an amount of Rs.894.87 Lakhs given to suppliers, etc. outstanding. We are unable to comment on the realization of these advances. An amount of Rs.700 Lakhs is set aside towards provision for Advances considered as doubtful.

Our opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue recognition (refer note 3.1 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Revenue from sale of residential and commercial units represents 65.70% of the total revenue from operations of the company. Revenue recognition - Fixed price development contracts The Company inter alia engages in fixed - price development contracts, where, revenue is recognized using the percentage of completion computed as per the input method based on management’s estimate of contract costs ( Refer Note 3.1 to the standalone financial statements). Measurement of revenue recorded over time which is dependent on the estimates of the costs to complete Revenue recognition involves significant estimates related to measurement of costs to complete for the projects. Revenue from projects is recorded based on management’s assessment of the work completed, costs incurred and accrued and the estimate of the balance costs to complete. Due to the inherent nature of the projects and significant judgment involved in the estimate of costs to complete, there is risk of overstatement or understatement of revenue. At Year-end a significant amount of work in progress related to these contracts is recognized on the balance sheet.

Our audit procedures on revenue recognition included the following; • Evaluating that the company’s revenue recognition accounting policies are in line with the applicable Accounting standards and their application to the key customer contracts including consistent application; Sales cut-off procedures for determination of revenue in the current reporting period. • Scrutinizing all the revenue journal entries raised throughout the reporting period and comparing details of a sample of these journals, Which met certain risk-based criteria, with relevant underlying documentation; • Conducting site visits during the year for selected projects to understand the scope and nature of the projects and to assess the progress of the projects and • Considered the adequacy of the disclosures in note 2 & 3 to the standalone financial statement in respect of the judgment taken in recognizing revenue for residential and hospitality sector. In addition, we have the performed the following procedures: Revenue recognition prior to receipt of OC / similar approval and intimation to the customer • Discussing and challenging key management judgments in interpreting contractual terms including obtaining in- house legal interpretations; • Testing sample sales of units for projects with the underlying contracts, completion status and proceeds received from customers;

• Identified and tested operating effectiveness of key controls around approvals of contracts, milestone billing, intimation of possession letters / intimation of receipt of occupation certificate and controls over collection from customers; and • We have obtained confirmations, on a sample basis, from major customers for selected projects to confirm revenue recognized during the year end, performing alternative procedures by comparing details with contracts , collection details and other underlying project related documentation for cases where confirmations are not received.

Measurement of revenue recorded over time which is dependent on the estimates of the costs of complete Compared, on a sample basis, revenue transactions recorded during the year with the underlying contracts, progress reports, invoices raised on customers and collections in bank accounts and whether the related revenue had been recognized in accordance with the Company’s revenue recognition policies; • Identification and testing operating effectiveness of key controls over recording of actual costs incurred for the projects; • Review of the costs to complete workings, comparing the costs to complete with the budgeted costs and inquiring into reasons for variance; and • Sighting approvals for changes in budgeted costs with the rationale for the changes and assessment of contract costs to determine no revenue nature costs are taken to inventory.

Inventories (refer note 11 to standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Inventories comprising of land, construction work in progress, food & beverages represent 32.58% of the Company’s total assets. Assessing net realizable value The Company recognizes profit on each sale by reference to the overall project margin, which is the projected profit percentage for a phase that may comprise multiple units and can last a number of years. The recognition of profit is therefore dependent on the estimate of future selling prices and build costs including an allowance for risk. Further estimation uncertainty and exposure to cyclicality exists within the long term projects. Forecasts of future sales are dependent on market conditions, which can be difficult to predict and be influenced by political and economic factors. Inventory represents the capitalized project costs to date less amounts expensed on sales by reference to the aforementioned projections. It is held at the lower of cost

Our audit procedures to assess the net realizable value (NRV) of inventories included the following: • Discussion with the management to understand the basis of calculation and justification for the estimated recoverable amounts of the unsold units (“the NRV assessment”); • Evaluating the design and implementation of the Company’s internal controls over the NRV assessment. Our evaluation included assessing whether the NRV assessment was prepared and updated by appropriate personnel of the Company and whether the key estimates, including estimated future selling prices and costs of completion for all property development projects, used in the NRV assessment, were discussed and challenged by management as appropriate; • Evaluating the management’s valuation methodology and assessing the key estimates, data inputs and assumptions adopted in the valuations, which included comparing expected future average selling prices with available market data such as

and net realizable value, the latter also being based on the forecast for the project. As such inappropriate assumptions in these forecasts can impact the assessment of the carrying value of inventories. Further, due to their materiality in the context of total assets of the Company this is considered significant to our overall audit strategy and planning.

recently transacted prices for similar properties located in the nearby vicinity of each property development project and the sales budget plans maintained by the Company; • Re-performing the calculations of the NRV assessment and comparing the estimated construction costs to complete each development with the Company’s updated budgets.

Land Advances - (refer note 10 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

Assessment of recoverability of land advances Land advance represents a sizeable portion of the Company’s total assets. Land advance represents the amount paid towards procurement of land parcels to be used in the future, for construction of residential projects. These advances are carried at cost less impairment losses, if any. These land advance will be converted into land parcels as per the terms of the underlying contract under which these land advances have been given. To assess the carrying value of land advances, these advances are tested for recoverability by the Company by comparing the valuation of land parcels in the same area for which land advances have been given. Further due to their materiality in the context of total assets of the company this is consider significant to our overall audit.

Our audit procedures to assess the recoverability of land advances included the following; • For our samples, verified the underlying agreements in possession of the Company, based on which land advances were given; • Discussion with the management to understand their plan for conversation of these land advances into land parcels; and • For our samples, verified the valuation reports of land stock.

Investment in subsidiaries and loans to group companies (refer to note 8, 9 and 10 to the standalone financial statements)

The key Audit Matter

How the matter was addressed in our audit

The carrying amount of the investments in subsidiaries, held at cost represents 11.34%, to associate, represents 4.91% of the Company’s total assets respectively. Recoverability of investment in subsidiary, joint ventures and an associate The Company has investments in subsidiaries, joint ventures and an associate company which are considered to be associated with significant risk in respect of valuation of such investments. These investments are carried at cost less any diminution in value of such investments. In addition, considering the materiality of the investments in subsidiaries, joint ventures and an associate, vis-a-vis the total assets of the Company, this is considered to be significant to our overall audit strategy and planning.

Recoverability of investment in subsidiary, joint ventures and an associate Our audit procedures included: • Comparing the carrying amount of investments with the relevant subsidiaries, joint ventures and associate balance sheet to identify whether their net assets, being an approximation of their minimum recoverable amount, were in excess of their carrying amount and assessing whether those subsidiaries, joint ventures and an associate have historically been profit-making; • For the investments where the carrying amount exceeded the net asset value, comparing the carrying amount of the investment with the projected profitability based on approved business plans of the subsidiaries joint ventures and an associate; • Considering the adequacy of disclosures in respect of the investment in subsidiaries, joint ventures and an associate.

The key Audit Matter

How the matter was addressed in our audit

Recoverability of loans to subsidiaries and joint ventures The Company has extended loans to joint ventures and subsidiaries that are assessed for recoverability at each period end. Financial assets, which include current loans to joint ventures and subsidiaries aggregated to Rs 1718.86 lakhs at 31 March 2023 Due to the nature of the business in the real estate industry, the Company is exposed to heightened risk in respect of the recoverability of the loans and advances granted to the aforementioned related parties. There is also judgment involved as to the recoverability of the working capital and project specific loans, Which rely on a number of property developments being completed over the time period specified in agreements.

Recoverability of loans to subsidiaries and joint ventures Our procedures included: • We reviewed the controls in place for issuing new loans and evidenced the Board/MD approval obtained. We obtained management’s assessment of the recoverability of the loans, which includes cash flow projections over the duration of the loans. These projections are based on underlying property development appraisals; • We tested cash receipts received in relation to these loans during the year through to bank statement; and We have obtained independent confirmations to ensure completeness and existence of loans and advances held by related parties as on 31 March 2023.

Other Information

The Company’s Management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company’s annual report, but does not include the standalone financial statements and our auditors’ report there on.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion there on.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statement or our knowledge obtained in the 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 Standalone Financial Statements

The Company’s Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act, with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit/loss and other comprehensive income, changes in equity and cash flow of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards ( Ind AS) specified under Section 133 of the Act. 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, Management and Board of Directors are responsible for assessing the Company’s ability to continue as a going concern , disclosing, as applicable, matters related to going concern and using the 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.

Board of Directors is also responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibility for the audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ 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 standalone 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 standalone 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 control relevant to the audit in order to design audit procedures that are 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 with reference to financial statements 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 standalone 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 standalone financial statements, including the disclosures, and whether the standalone 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 standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ 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

As required by the Companies (Auditor’s Report) Order, 2020 (‘the Order’), issued by the Central Government of India in terms of Section 143(11)of the Act, we give in the “Annexure A”, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

(A) As required by Section 143(3) of the Act, 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;

(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;

(c) The standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows dealt with by this report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act;

(e) On the basis of the written representations received from the directors as on 31 March 2023 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2023 from being appointed as a director in terms of Section 164 (2) of the act; and

(f) With respect to the adequacy of the internal financial controls with reference to the standalone financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

(B) With respect to the other matters to be included in the Auditors’ 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 31 March 2023 on its financial position in Its standalone financial statements - Refer Note 34 & 41 to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31 March 2023; and

(iv) 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 borrowing funds or share premium or any other sources or Kind of funds) by the Company to or in any other person 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 to or 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 Party or

• Provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries.

c) Based on such audit procedures as 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 (iv) (a) and (iv) (b) contain any material mis-statement.

(v). During the year, the company has not declared any dividend.

(C) With respect to the matter to be included in the Auditor’s Report under Section 197(16) of the Act:

In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the act. The Remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act which are required to be commented upon by us.

For and on behalf of Karumanchi & Associates

Chartered Accountants Firm’s Registration Number : 001753S Sd/-

K.Peddabbai

Partner M.No : 025036

UDIN No : 23025036BGYMDH5890

Place : Hyderabad Date : 27.05.2023

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Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS financial statements of PRAJAY ENGINEERS SYNDICATE LIMITED (“the Company”) which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including other comprehensive income), Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Ind AS 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 Standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial position), Loss(financial performance including other comprehensive income), cash flows of the Company and the changes in equity of company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards(lnd AS) specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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 judgements 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 Standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the standalone Ind AS financial statements by the Board of Directors of the company.

Auditor’s Responsibility

Our responsibility is to express an opinion on these Standalone Ind AS 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 Standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the Standalone Ind AS 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 Standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the 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 Standalone Ind AS 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 Standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Ind AS 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 including the Ind AS, of the state of affairs(Financial Position) of the Company as at March 31, 2018, and its Loss(Financial Performance including other comprehensive income) and its Cash Flows and the changes in equity for the year ended on that date.

Emphasis of Matter

We draw attention to the following:

a) Note 39(a) of the Standalone Financial Statements, in respect of trade receivable considered good include an amount of Rs.21059.50 Lakhs due from customers which are outstanding for more than six months. We are unable to comment on the realisation of these receivables in the absence of conformation from the concerned parties. An amount of Rs.1246.96 Lakhs is set aside towards provision for trade receivables considered as doubtful.

b) Note 39(b) of the standalone financial statements, in respect of Loans & Advances amounting to Rs.5621.56 Lakhs towards purchase of Land/Development towards certain project of long term nature, and an amount of Rs.2018.77 Lakhs given to suppliers, etc outstanding from earlier years. We are unable to comment on the realisation of these advances. An amount of Rs.700 Lakhs is set aside towards provision for Advances considered as doubtful.

Our Opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), as amended, 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, 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 purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

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

d. In our opinion, the aforesaid Standalone Ind AS financial statements comply with the 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, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 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”.

g. 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, 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 on its financial position in its Standalone Ind AS financial statements - Refer Note 34(c) to the Standalone Ind AS financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;

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

iv. The disclosure regarding details of specified bank notes held and transacted during 8^th November, 2016 to 30^th December, 2016 has not been made since the requirement does not pertain to financial year ended 31^st March, 2018.

“Annexure A” to the Independent Auditors’ Report

Referred to in paragraph 1 under the heading ‘Report on Other Legal & Regulatory Requirement’ of our report of even date to the Standalone Ind AS financial statements of the Company for the year ended March 31, 2018:

Statement on matters specified in paragraphs 3&4of the Companies (Auditor’s Report) Order, 2016:

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

(b) As explained to us, The Company has a programme for physical verification of fixed assets at periodic intervals in our opinion, the period of verification is reasonable having regard to the size of the company and nature of its Assets. No material discrepancies were noticed on such verification.

(c) The title deeds of immovable properties are held in the name of the company.

2) The Inventory includes construction work in progress and cost of development rights in Identified land. Physical verification of inventory has been conducted in reasonable Interval by the management. No material discrepancies noticed on such verification.

3) The Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability partnerships or other parties covered in the Register maintained under section 189 of the Act. Accordingly, the provisions of clause 3 (iii) (a) to (C) of the Order are not applicable to the Company and hence not commented upon.

4) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security.

5) The Company has not accepted any deposits from the public and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the public are not applicable.

6) As informed to us, the maintenance of Cost Records has not been specified by the Central Government under sub-section (1) of Section 148 of the Act, in respect of the activities carried on by the company.

7) (a) According to information and explanations given to us and on the basis of our examination of the books of account, and records, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Sales tax, Service Tax, Duty of Customs, Duty of Excise, Value added Tax, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2018 for a period of more than six months from the date on when they become payable.

b) According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax outstanding on account of any dispute, Except as given below

Particulars	Amount (Rs. Lakhs)	Period To Which The Amount Relates(FY)	Forum Where the Dispute Is Pending
Income Tax	873.55	2007-08	ITAT
Income Tax	75.64	2010-11	ITAT
Service Tax	1820.62	2006-07 To 2010-11	CESTAT

8) In our opinion and according to the information and explanations given to us, the Company has defaulted in the repayment of dues to banks. Principal amounts aggregating Rs.9090.28 Lakhs are due from December 2012 To March 2018, Interest amounts aggregating Rs.14326.32 Lakhs are due from April 2013 to March 2018. The Company has not taken loan either form financial institutions or from the government and has not issued any debentures.

9) Based upon the audit procedures performed and the information and explanations given by the management, the company has not raised moneys by way of initial public offer or further public offer including debt instruments and term Loans. Accordingly, the provisions of clause 3 (ix) of the Order are not applicable to the Company and hence not commented upon.

10) Based upon the audit procedures performed and the information and explanations given by the management, we report that no fraud by the Company or on the company by its officers or employees has been noticed or reported during the year.

11) Based upon the audit procedures performed and the information and explanations given by the management, during the year the managerial remuneration is not paid or provided. Hence specific approvals from Central Government with reference to section 197 read with Schedule V to the Companies Act does not arise.

12) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 4 (xii)of the Order are not applicable to the Company.

13) In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

14) Based upon the audit procedures performed and the information and explanations given by the management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of clause 3 (xiv) of the Order are not applicable to the Company and hence not commented upon.

15) Based upon the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.

16) In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable to the Company and hence not commented upon.

“Annexure B” to the Independent Auditors Report of even dated on the standalone Ind AS Financial Statements PRAJAY ENGINEERS SYNDICATE LIMITED.

Report on Internal Financial Controls under Clause (i) of Sub-Section 3 of Section 143 of the Companies Act, 2013(“the Act”)

We have audited the internal financial controls over financial reporting of PRAJAY ENGINEERS SYNDICATE LIMITED (“The Company”) as of March 31,2018 in conjunction with our audit of the standalone Ind AS financial statements of the company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on “the internal control over financial reporting criteria established by the company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by Institute of Chartered Accountants of India”. These Responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act,2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Standalone Ind AS financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Standalone Ind AS financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the company has, in all material respect, an adequate internal financial control system over financial reporting and such internal financial controls over financial reporting were operating effectively as at march 31,2018,based on “ The Internal control Over Financial Reporting Criteria established by the company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued By The Institute of chartered accountants of India.

For and on behalf of

Karumanchi & Associates

Chartered Accountants

Firm’s registration number:001753S

K.Peddabbai

Partner

M.No: 025036

Place: Hyderabad

Date : 30.05.2018

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Mar 31, 2016

Independent Auditor’s Report To the Members of

M/s. Prajay Engineers Syndicate Limited Report on the Financial Statements

We have audited the accompanying Standalone financial statements of M/s.Prajay Engineers Syndicate Limited (“the Company”) which comprises the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone 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 Standalone 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 the Companies (Accounts) Rules, 2014. 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 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 Standalone 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 there under.

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 the 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 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 the 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 Standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone 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 March 31, 2016, and its Loss and its Cash Flow for the year ended on that date.

Emphasis of matter

We draw attention to the following:

a) Note 37(a) of the Standalone Financial Statements, in respect of trade receivables considered good include an amount of Rs, 21498.92 Lakhs due from customers which are outstanding for more than six months. We are unable to comment on the realization of these receivables in the absence of confirmation from the concerned parties. An amount of Rs, 1246.96 Lakhs is set aside towards provision for trade receivables considered as doubtful.

b) Note 37(b) of the Standalone Financial Statements, in respect of Loans and advances amounting to Rs, 5355.14 Lakhs towards purchase of land/ development towards certain projects of long term nature, and an amount of Rs, 1387.86 Lakhs given to suppliers etc. outstanding from earlier years. We are unable to comment on the realization of these advances. An amount of Rs, 700 Lakhs is set aside towards provision for advances considered as doubtful.

c) Note 24 and 25 (c) In respect of recognizing profit on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects/ contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by us.

Further, with effect from 01.04.2012, ICAI has issued Guidance Note on Accounting for real estate Transactions (revised 2012), where “Project costs incurred” method is the preferred method for computation of revenue. This is not being followed.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), as amended, 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, 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 purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

c. the Balance Sheet, the 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 (Standalone) financial statements comply with the 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, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016 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”.

g. 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, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financial position- refer Note 30 to the 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.

Referred to in paragraph 1 under the heading ‘Report on Other Legal & Regulatory Requirement’ of our report of even date to the standalone financial statements of the Company for the year ended March 31, 2016:

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

(b) The Fixed Assets have been physically verified by the management in a phased manner, designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the company and nature of its business. Pursuant to the program, a portion of the fixed asset has been physically verified by the management during the year and no material discrepancies between the books records and the physical fixed assets have been noticed.

(c) The title deeds of immovable properties are held in the name of the company.

2) (a) The management has conducted the physical verification of inventory at reasonable intervals.

(b) The discrepancies noticed on physical verification of the inventory as compared to books records which has been properly dealt with in the books of account were not material.

3) The Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability partnerships or other parties covered in the Register maintained under section 189 of the Act. Accordingly, the provisions of clause 3 (iii) (a) to (C) of the Order are not applicable to the Company and hence not commented upon.

4) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and I86 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security.

5) The Company has not accepted any deposits from the public and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the public are not applicable.

6) As informed to us, the maintenance of Cost Records has not been specified by the Central Government under sub-section (1) of Section 148 of the Act, in respect of the activities carried on by the company.

7) (a) According to information and explanations given to us and on the basis of our examination of the books of account, and records, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Sales tax, Service Tax, Duty of Customs, Duty of Excise, Value added Tax, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2016 for a period of more than six months from the date on when they become payable.

(b) According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax outstanding on account of any dispute, except as given below.

Statement of disputed dues:

Particulars	Amount (Rs, Lakhs)	Period to which the amount relates (FY)	Forum where the dispute is pending
Income tax	15.45	2006-07	Income Tax Appellate Tribunal
	289.20	2009-10	Income Tax Appellate Tribunal
	841.49	2010-11	Income Tax Appellate Tribunal
	103.75	2011-12	Commissioner of Income Tax (Appeals)
Service tax	1820.62	2006-07 to 2010-11	Customs, Excise and Service Tax Appellate Tribunal

8) In our opinion and according to the information and explanations given to us, the Company has defaulted in the repayment of dues to banks. Principal amounts aggregating Rs, 5816.53 Lakhs are due from December 2012 to March 2016, and interest amounts aggregating Rs, 7328.36 Lakhs are due from April 2013 to March 2016. The Company has not taken any loan either from financial institutions or from the government and has not issued any debentures.

9) Based upon the audit procedures performed and the information and explanations given by the management, the company has not raised moneys by way of initial public offer or further public offer including debt instruments and term Loans. Accordingly, the provisions of clause 3 (ix) of the Order are not applicable to the Company and hence not commented upon.

10) Based upon the audit procedures performed and the information and explanations given by the management, we report that no fraud by the Company or on the company by its officers or employees has been noticed or reported during the year.

11) Based upon the audit procedures performed and the information and explanations given by the management, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act;

12) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 4 (xii) of the Order are not applicable to the Company.

13) In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

14) Based upon the audit procedures performed and the information and explanations given by the management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of clause 3 (xiv) of the Order are not applicable to the Company and hence not commented upon.

15) Based upon the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.

16) In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable to the Company and hence not commented upon.

"Annexure B" to the Independent AuditorRs,s Report of even date on the Standalone Financial Statements of M/s Prajay Engineers Syndicate Limited

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

In conjunction with our audit of the standalone financial statements of the company as of and for the year ended 31^st March 2016, we have audited the internal financial controls over financial reporting of M/s.Prajay Engineers Syndicate Limited (“the Company”) for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on “the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India”. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance

Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on “the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India”.

For and on behalf of

Meenavalli & Associates

CA. Machar Rao. M

Chartered Accountants

Partner

FRN:012208S

M.No:218836

Place : Hyderabad

Date : 14.06.2016

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Mar 31, 2015

I have audited the accompanying standalone financial statements of Prajay Engineers Syndicate Limited ("the Company"), which comprise the Balance Sheet as at March 31,2015 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 Standalone 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 standalone 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 the Companies (Accounts) Rules, 2014. 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 financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's responsibility

My responsibility is to express an opinion on these standalone financial statements based on my audit. I 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 there under.

I conducted my audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that I 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 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.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion on the standalone financial statements.

Opinion

In my opinion and to the best of my information and according to the explanations given to me, the aforesaid standalone 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 March 31,2015, and its loss and its cash flows for the year ended on that date.

Emphasis of matter

I draw attention to the following:

a) Note 37(a) of the Standalone Financial Statements, in respect of trade receivables considered good include an amount of Rs. 23,519.03 lacs due from customers which are outstanding for more than six months. For the reasons stated therein, I am unable to comment on the realization of the aforesaid receivables.

b) Note 37(b) of the Standalone Financial Statements, in respect of advances amounting to Rs. 5,999.05 lacs given to landlords /developers, and Rs. 727.58 lacs given to suppliers, etc outstanding from earlier years in respect of which no provision has been made for the reasons stated therein.

c) Note 24 and 25, in respect of recognizing profit on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects/contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by me.

My opinion is not modified in respect of these matters.

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 in terms of section 143(11) of the Act, I 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, I report that:

a) I have sought and obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of my audit;

b) In my opinion proper books of account as required by law have been kept by the Company so far as appears from my 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 my opinion, the aforesaid standalone financial statements comply with the 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 the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in my opinion and to the best of my information and according to the explanations given to me:

i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - refer Note 30 to the financial statements.

ii) The Company did not have any material foreseeable losses relating to long term contracts including derivative contracts.

iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund, by the Company.



ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under "Report on other legal and regulatory requirements" section of my Report of even date to the members of Prajay Engineers Syndicate Limited)

(i) In respect of its fixed assets:

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

(b) As explained to me, all the fixed assets are physically verified by the Management in a phased periodical manner, which in my opinion is reasonable, having regard to the size of the Company and the nature of its assets. According to the information and explanations given to me, no material discrepancies were noticed on such verification.

(ii) (a) The inventories in respect of hotels and resorts have been physically verified by the management, at the year end. In my opinion the frequency of verification is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of my examination of the records of inventory, in my opinion, the Company is maintaining proper records of inventory and the discrepancies noticed on physical verification between the physical stocks and book records were not material in relation to the operations of the Company.

(iii) According to the information and explanations given to me, the Company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013 and accordingly clauses iii (a) and iii (b) of paragraph 3 of CARO are not applicable.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventories and fixed assets and for the sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weaknesses in internal control system.

(v) The company has not accepted deposits from the public during the year. The deposits outstanding have been repaid fully during the year and there are no outstanding deposits as at March 31,2015, and the Company in this respect has complied with the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under.

(vi) I am informed that the Central Government has not prescribed maintenance of cost records under Section 148(1) of the Companies Act, 2013.

(vii) (a) According to records of the Company, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, value added tax, cess and any other material statutory dues applicable to it. There are no arrears of the aforesaid dues as at 31st March, 2015 outstanding for a period of more than six months from the date they became payable. There are no dues towards investor education and protection fund.

(b) As at 31st March, 2015 according to the records of the Company and the information and explanations given to me, there are no dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and cess matters that have not been deposited on account of any dispute, except as given below.

Particulars Amount Period to which the (Rs.lacs) amount relates(FY)

15.45 2006-07

289.20 2009-10

Income tax 841.49 2010-11

103.75 2011-12

Service tax 1820.62 2006-07 to 2010-11

Value added tax 2.77 2010-11

3.00 2011-12



Particulars Forum where the dispute is pending

Income Tax Appellate Tribunal

Income Tax Appellate Tribunal

Income tax Income Tax Appellate Tribunal

Commissioner of Income Tax (Appeals)

Service tax Customs, Excise and Service Tax Appellate Tribunal

Value added tax Appellate Deputy Commissioner

Appellate Deputy Commissioner

(viii) The Company does not have accumulated losses as at 31st March, 2015. However, the Company has incurred cash loss during the financial year ended on 31st March, 2015; there was no cash loss in the immediately preceding financial year.

(ix) In my opinion and according to the information and explanations given to me, the company has defaulted in repayment of dues to banks. Principal amounts aggregating Rs. 3,966.55 lacs are due from December 2012 to March 2015, and interest amounts aggregating Rs. 4,408.15 lacs are due from April 2013 to March 2015. There are no debentures as on the balance sheet date.

(x) According to the information and explanations given to me, the company has given guarantee, for loans taken by Prajay Properties Private Limited from banks or financial institutions, the terms and conditions whereof are not prima facie prejudicial to the interest of the company.

(xi) In my opinion and according to the information and explanations given to me, the term loans were applied for the purposes for which they were obtained.

(xii) To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on or by the Company was noticed or reported during the year.



S V RANGAN Place : Secunderabad Chartered Accountant Date : May 30, 2015 Membership No. 022037

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Mar 31, 2014

I have audited the accompanying financial statements of Prajay Engineers Syndicate 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") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. 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 misstatements, whether due to fraud or error.

Auditor''s responsibility

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

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 Company''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.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Opinion

In my opinion and to the best of my information and according to the explanations given to me, 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 Statement of Profit and Loss, of the loss of the Company for the year ended on that date; and

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

Emphasis of matter

I draw attention to the following:

a) Note 37(a) of the Financial Statements, in respect of trade receivables considered good include an amount of Rs. 24,419.62 lacs due from customers which are outstanding for more than six months. For the reasons stated therein, I am unable to comment on the realization of the aforesaid receivables.

b) Note 37(b) of the Financial Statements, in respect of advances amounting to Rs. 6,191.04 lacs given to landlords/developers, and Rs. 188.94 lacs given to suppliers, etc outstanding from earlier years in respect of which no provision has been made for the reasons stated therein.

c) Note 24 and 25, in respect of recognizing profit on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects/contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by me.

My opinion is not qualified in respect of these matters.

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 in terms of section 227 (4A) of the Act, I 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, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of my audit;

b) In my opinion proper books of account as required by law have been kept by the Company so far as appears from my 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 my opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs).

e) On the basis of written representations received from the directors as on March 31,2014 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2014 from being appointed as a director in terms of section 274 (1)(g) of the Act.

ANNEXURE TO THE AUDITORS'' REPORT

(Referred to in paragraph 1 under the heading "Report on other legal and regulatory requirements" of the Auditors'' Report of even date to the members of Prajay Engineers Syndicate Limited)

The nature of the Company''s business/activities during the year is such that clauses (xii), (xiii), (xiv), (xix) of paragraph 4 of the Companies (Auditor''s Report) Order, 2003 (CARO) are not applicable to the Company.

(i) In respect of its fixed assets:

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

(b) As explained to me, all the fixed assets are physically verified by the management in a phased periodical manner, which in my opinion is reasonable, having regard to the size of the Company and the nature of its assets. According to the information and explanations given to me, no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in my opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in my opinion, not affected the going concern status of the Company.

(ii) (a) The inventories in respect of hotels and resorts have been physically verified by the management, at the year end. In my opinion the frequency of verification is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of my examination of the records of inventory, in my opinion, the Company is maintaining proper records of inventory and the discrepancies noticed on physical verification between the physical stocks and book records were not material in relation to the operations of the Company.

(iii) (a) According to the information and explanations given to me, the Company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and accordingly clauses iii (b) to iii (d) of paragraph 4 of CARO are not applicable.

(b) According to the information and explanations given to me, the Company has taken secured/ unsecured loan from two parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of loan outstanding during the year was Rs. 3,277.50 lacs and the balance as at the year end is Rs. 3,276.08 lacs.

(c) In my opinion and according to the information and explanations given to me, the terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company. There is no interest payable on the loans.

(d) In respect of the loans taken, the principal amounts have not fallen due for payment.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventories and fixed assets and for the sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) In my opinion, and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that Section.

(b) In my opinion and according to the information and explanations given to me, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lacs in respect of any party during the year have been made at prices, which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public during the year and has complied with the provisions of sections 58A, 58AA and the rules framed there under.

(vii) The Company has an internal audit system, but it is not commensurate with the size and nature of the business of the Company.

(viii) I am informed that the Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956.

(ix) (a) According to records of the Company, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees'' state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and any other material statutory dues applicable to it. There are no arrears of the aforesaid dues as at 31st March, 2014 outstanding for a period of more than six months from the date they became payable.

There are no dues towards investor education and protection fund.

(b) As at 31st March, 2014 according to the records of the Company and the information and explanations given to me, there are no dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and cess matters that have not been deposited on account of any dispute, except as given below.

Statement of disputed dues

Particulars Amount Period to Forum where the (Rs. lacs) which the dispute is pending amount relates

Income tax 15.45 2006-07 Income Tax Appellate Tribunal 289.20 2009-10 Income Tax Appellate Tribunal Service tax 1820.62 2006-07 to Customs, Excise and Service 2010-11 Tax Appellate Tribunal

Value added tax 2.77 2010-11 Appellate Deputy Commissioner 3.00 2011-12 Appellate Deputy Commissioner

(x) The Company does not have accumulated losses as at 31st March, 2014. The Company has not incurred cash losses during the financial year ended on that date, and in the immediately preceding financial year.

(xi) In my opinion and according to the information and explanations given to me, the company has defaulted in repayment of dues to banks. Principal amounts aggregating Rs. 2007.00 lacs are due from December 2012 to March 2014, and interest amounts aggregating ''2088.86 lacs are due from April 2013 to March 2014. There are no debentures as on the balance sheet date.

(xii) According to the information and explanations given to me, the company has given guarantee, for loans taken by Prajay Properties Private Limited from banks or financial institutions, the terms and conditions whereof are not prima facie prejudicial to the interest of the company.

(xiii) In my opinion and according to the information and explanations given to me, the term loans were applied for the purposes for which they were obtained.

(xiv) According to the information and explanations given to me, and on an overall examination of the balance sheet of the Company, there are no funds raised on short term basis which have been used for long term investment.

(xv) During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act.

(xvi) The Company has not raised any money through a public issue during the year.

(xvii) To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on or by the Company was noticed or reported during the year.

S.V. RANGAN Place: Secunderabad Chartered Accountant Date : May 30, 2014 Membership No. 022037

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Mar 31, 2013

Report on the Financial Statements

I have audited the accompanying fi nancial statements of Prajay Engineers Syndicate Limited ("the Company"), which comprise the Balance Sheet as at March 31,2013, and the Statement of Profi t and Loss and Cash Flow Statement for the year then ended, and a summary of signifi cant accounting policies and other explanatory information.

Management''s responsibility for the Financial Statements

Management is responsible for the preparation of these fi nancial statements that give a true and fair view of the fi nancial position, fi nancial performance and cash fl ows of the Company in accordance with the Accounting Standards referred to in section 211 (3C) of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenanceof internal control relevant to the preparation and presentation of the fi nancial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.

Auditor''s responsibility

My responsibility is to express an opinion on these fi nancial statements based on my audit. I conducted my audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the fi nancial 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 fi nancial statements inorder to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''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 fi nancial statements.

I believe that the audit evidence I have obtained is suffi cient and appropriate to provide a basis for my audit opinion.

Opinion

In my opinion and to the best of my information and according to the explanations given to me, the fi nancial 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;

b) in the case of the Statement of Profi t and Loss, of the profi t of the Company for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash fl ows of the Company for the year ended on that date.

Emphasis of matter

I draw attention to the following:

a) Note 37(a) of the Financial Statements, in respect of trade receivables considered good include an amount of Rs.27,195.98 lacs due from customers which are outstanding for more than six months. For the reasons stated therein, I am unable to comment on the realization of the aforesaid receivables.

b) Note 37(b) of the Financial Statements, in respect of advances amounting to Rs.7,833.42 lacs given to landlords / developers, and Rs.275.58 lacs given to suppliers, etc outstanding from earlier years in respect of which no provision has been made for the reasons stated therein.

c) Note 24 & 25, in respect of recognizing profi t on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects / contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by me.

My opinion is not qualifi ed in respect of these matters.

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 in terms of section 227 (4A) of the Act, I give in the Annexure a statement on the matters specifi ed in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purpose of my audit;

b) in my opinion proper books of account as required by law have been kept by the Company so far as appears from my examination of those books.

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

d) in my opinion, the Balance Sheet, Statement of Profi t and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in section 211 (3C) of the Act;

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 disqualifi ed as on March 31, 2013, from being appointed as a director in terms of section 274 (1)(g) of the Act.

ANNEXURE TO THE AUDITORS'' REPORT

(Referred to in paragraph 1 under the heading "Report on other legal and regulatory requirements" of the Auditors'' Report of even date to the members of Prajay Engineers Syndicate Limited)

The nature of the Company''s business/ activities during the year is such that clauses (xii), (xiii), (xiv), (xix) of paragraph 4 of the Companies (Auditor''s Report) Order, 2003 (CARO) are not applicable to the Company.

(i) In respect of its fi xed assets:

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

(b) As explained to me, all the fi xed assets are physically verifi ed by the management in a phased periodical manner, which in my opinion is reasonable, having regard to the size of the Company and the nature of its assets. According to the information and explanations given to me, no material discrepancies were noticed on such verifi cation.

(c) The fi xed assets disposed off during the year, in my opinion, do not constitute a substantial part of the fi xed assets of the Company and such disposal has, in my opinion, not affected the going concern status of the Company.

(ii) (a) The inventories in respect of hotels and resorts have been physically verifi ed by the management, at the year end. In my opinion the frequency of verifi cation is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verifi cation of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of my examination of the records of inventory, in my opinion, the Company is maintaining proper records of inventory and the discrepancies noticed on physical verifi cation between the physical stocks and book records were not material in relation to the operations of the Company.

(iii) (a) According to the information and explanations given to me, the Company has not granted any loan secured or unsecured to companies, fi rms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and accordingly clauses iii (b) to iii (d) of paragraph 4 of CARO are not applicable.

(b) According to the information and explanations given to me, the Company has taken secured/unsecured loan from two parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of loan outstanding during the year was Rs.3,277.50 lacs and the balance as at the year end is Rs. 3,277.50 lacs.

(c) In my opinion and according to the information and explanations given to me, the terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company. There is no interest payable on the loans.

(d) In respect of the loans taken, the principal amounts have not fallen due for payment.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventories and fi xed assets and for the sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) In my opinion, and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that Section.

(b) In my opinion and according to the information and explanations given to me, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees fi ve lacs in respect of any party during the year have been made at prices, which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public during the year and has complied with the provisions of sections 58A, 58AA and the rules framed there under.

(vii) The Company has an internal audit system, but it is not commensurate with the size and nature of the business of the Company.

(viii) I am informed that the Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956.

(ix) According to records of the Company, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees'' state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and any other material statutory dues applicable to it. There are no arrears of the aforesaid dues as at 31st March, 2013 outstanding for a period of more than six months from the date they became payable. There are no dues towards investor education and protection fund.

(x) The Company does not have accumulated losses as at 31st March, 2013. The Company has not incurred cash losses during the fi nancial year ended on that date, but has incurred cash losses during the immediately preceding fi nancial year.

(xi) In my opinion and according to the information and explanations given to me, the company, during the year, has not defaulted in repayment of dues to fi nancial institutions and banks. There are no debentures as on the balance sheet date.

(xii) According to the information and explanations given to me, the company has given guarantee, for loans taken by Prajay Properties Private Limited from banks or fi nancial institutions, the terms and conditions whereof are not prima facie prejudicial to the interest of the company.

(xiii) In my opinion and according to the information and explanations given to me, the term loans were applied for the purposes for which they were obtained.

(xiv) According to the information and explanations given to me, and on an overall examination of the balance sheet of the Company, there are no funds raised on short term basis which have been used for long term investment.

(xv) During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act.

(xvi) The Company has not raised any money through a public issue during the year.

(xvii) To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on or by the Company was noticed or reported during the year.

S V Rangan

Place : Secunderabad Chartered Accountant

Date : May 30, 2013 Membership No.022037

---

Mar 31, 2012

1. I have audited the attached Balance Sheet of Prajay Engineers Syndicate Limited ("the Company") as at March 31, 2012, the Statement of Profit and Loss 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. My responsibility is to express an opinion on these financial statements based on my audit.

2. I conducted my audit in accordance with auditing standards generally accepted in India. Those standards require that I plan and perform the audit to obtain reasonable assurance about 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 statement presentation. I believe that my audit provides a reasonable basis for my opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, I enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Attention is drawn to the following:

a. Note 39(a) of the Financial Statements, in respect of Trade Receivables, unsecured considered good outstanding for a period of more than six months amounting to Rs.27,213.09 lacs. For the reasons stated therein, I am unable to comment on the realizations of the aforesaid Receivables.

b. Note 39(b) of the Financial Statements, in respect of sale of constructed properties amounting to Rs.235.68 lacs. For the reasons stated therein, I am unable to comment on these sales.

c. Note 39(c) ofthe Financial Statements, in respect ofadvances amounting to Rs.7,858.42 lacs given to landlords/developers, and Rs.1,205.17Lacs given to suppliers, etc outstanding from earlier years in respect of which no provision has been made for the reasons stated therein.

5. Subject to paragraph 4(a) and 4(b), and further to my comments in the annexure referred to in paragraph (3) above, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purposes of my audit;

b) in my opinion, proper books of account as required by law have been kept by the company so far as it appears from my examination of those books;

c) the Balance Sheet, the 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 my opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report are in compliance with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

e) for recognizing profit on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects/contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by me.

f) in my opinion and to the best of my information and according to the explanations given to me, 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:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2012;

(ii) in the case of the Statement of Profit and Loss, of the loss of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

6. On the basis of written representations received from the directors as on March 31, 2012, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2012 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in paragraph 3 of the Auditors' Report of even date to the members of Prajay Engineers Syndicate

Limited)

The nature of the Company's business/ activities during the year is such that clauses (xii), (xiii), (xiv), (xix) of

paragraph 4 of the Companies (Auditor's Report) Order, 2003 (CARO) are not applicable to the Company.

(i) In respect of its fixed assets:

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

(b) As explained to me, all the fixed assets are physically verified by the management in a phased periodical manner, which in my opinion is reasonable, having regard to the size of the Company and the nature of its assets. According to the information and explanations given to me, no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in my opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in my opinion, not affected the going concern status of the Company.

(ii) (a) The inventories in respect of hotels and resorts have been physically verified by the management at

the year end. In my opinion the frequency of verification is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of my examination of the records of inventory, in my opinion, the Company is maintaining proper records of inventory and the discrepancies noticed on physical verification between the physical stocks and book records were not material in relation to the operations of the Company.

(iii) (a) According to the information and explanations given to me, the Company has not granted any loan

secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and accordingly clauses iii (b) to iii (d) of paragraph 4 of CARO are not applicable.

(b) According to the information and explanations given to me, the Company has taken secured/unsecured loan from two parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of loan outstanding during the year was Rs.3,277.50 lacs and the balance as at the year end is Rs. 3,277.50 lacs.

(c) In my opinion and according to the information and explanations given to me, the terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company. There is no interest payable on the loans.

(d) In respect of the loans taken, the principal amounts have not fallen due for payment.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventories and fixed assets and for the sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) In my opinion, and according to the information and explanations given to me the particulars of

contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that Section.

(b) In my opinion and according to the information and explanations given to me, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lacs in respect of any party during the year have been made at prices, which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public during the year and has complied with the provisions of sections 58A, 58AA and the rules framed there under.

(vii) The Company has an internal audit system, the scope and coverage of which needs to be increased to maJ
(viii) I am informed that the Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956.

(ix) (a) According to records of the Company, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and any other material statutory dues applicable to it. There are no arrears of the aforesaid dues as at 31st March, 2012 outstanding for a period of more than six months from the date they became payable, except as given below.

There are no dues towards investor education and protection fund.

Statement of arrears of statutory dues outstanding for more than six months

Particulars Amount Period to which Due date Date of (Rs.lacs) the amount relates payment

Income tax 143.59 2009-10 Not applicable Not paid

(b) As at 31st March, 2012 according to the records of the Company and the information and explanations given to me, there are no dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and cess matters that have not been deposited on account of any dispute, except as given below.

Statement of disputed dues

Particulars Amount Period to which Forum where the (Rs.lacs) the amount relates dispute is pending

Income tax 236.35 2007-08 Commissioner of Income Tax (appeals)

402.40 2008-09 Commissioner of Income Tax (appeals)

Service tax 783.85 2006-07 to 2010-11 Commissioner of Service Tax

(x) The Company does not have accumulated losses as at 31st March, 2012. The Company has incurred cash losses during the financial yearended on that date, but has not incurred cash losses during the immediately preceding financial year.

(xi) In my opinion and according to the information and explanations given to me, the company, during the year, has not defaulted in repayment of dues to financial institutions and banks. There are no debentures as on the balance sheet date.

(xii) According to the information and explanations given to me, the company has given guarantee, for loans taken by Prajay Properties Private Limited from banks or financial institutions, the terms and conditions whereof are not prima facie prejudicial to the interest of the company.

(xiii) In my opinion and according to the information and explanations given to me, the term loans were applied for the purposes for which they were obtained.

(xiv) According to the information and explanations given to me, and on an overall examination of the balance sheet of the Company, there are no funds raised on short term basis which have been used for long term investment.

(xv) During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act.

(xvi) The Company has not raised any money through a public issue during the year.

(xvii) To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on or by the Company was noticed or reported during the year.

S.V. RANGAN

Chartered Accountant Membership No. 022037

Place : Secunderabad

Date : August 31, 2012

---

Mar 31, 2011

1. I have audited the attached Balance Sheet of Prajay Engineers Syndicate Limited, as at March 31, 2011 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit.

2. I conducted my audit in accordance with auditing standards generally accepted in India. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, I enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Attention is drawn to the following:

a. Note B.18(a) of Schedule 18, in respect of Sundry Debtors, unsecured considered good outstanding for a period of more than six months amounting to Rs.26421.37 lacs. For the reasons stated therein, I am unable to comment on the realizations of the aforesaid debtors.

b. Note B.18(b) of Schedule 18, in respect of advances amounting to Rs.8514.32 lacs given towards purchase of land/development and Rs.1671.20 Lacs given to suppliers, etc outstanding from earlier years in respect of which no provision has been made for the reasons stated therein.

5. Subject to paragraph 4(a) and further to my comments in the annexure referred to in paragraph (3) above, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purposes of my audit;

b) in my opinion, proper books of account as required by law have been kept by the company so far as it appears from my examination of those books;

c) 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;

d) in my opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

e) for recognizing profit on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects/contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by me.

f) in my opinion and to the best of my information and according to the explanations given to me, the said accounts, read with the notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011;

(ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

6. On the basis of written representations received from the directors as on March 31, 2011, and taken on record by the Board of Directors, I report that none of the directors is disqualified as on March 31, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in paragraph 3 of the Auditors' Report of even date to the members of Prajay Engineers Syndicate Limited)

The nature of the Company's business/ activities during the year is such that clauses (xii), (xiii), (xiv), (xix) of paragraph 4 of the Companies (Auditor's Report) Order, 2003 (CARO) are not applicable to the Company.

(i) In respect of its fixed assets:

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

(b) As explained to me, all the fixed assets are physically verified by the management in a phased periodical manner, which in my opinion is reasonable, having regard to the size of the Company and the nature of its assets. According to the information and explanations given to me, no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in my opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in my opinion, not affected the going concern status of the Company.

(ii) (a) The inventories in respect of hotels and resorts have been physically verified by the management at the year end. In my opinion the frequency of verification is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of my examination of the records of inventory, in my opinion, the Company is maintaining proper records of inventory and the discrepancies noticed on physical verification between the physical stocks and book records were not material in relation to the operations of the Company.

(iii) (a) According to the information and explanations given to me, the Company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and accordingly clauses iii (b) to iii (d) of paragraph 4 of CARO are not applicable.

(b) According to the information and explanations given to me, the Company has taken secured/unsecured loan from two parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of loan outstanding during the year was Rs.3277.50 lacs and the balance as at the year end is Rs. 3277.50 lacs.

(c) In my opinion and according to the information and explanations given to me, the terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company. There is no interest payable on the loans.

(d) In respect of the loans taken, the principal amounts have not fallen due for payment.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventories and fixed assets and for the sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) In my opinion, and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that Section.

(b) In my opinion and according to the information and explanations given to me, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lacs in respect of any party during the year have been made at prices, which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public during the year and has complied with the provisions of sections 58A, 58AA and the rules framed there under.

(vii) The Company has an internal audit system, the scope and coverage of which needs to be increased to make it commensurate with its size and nature of the business of the Company.

(viii) I am informed that the Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956.

(ix) (a) According to records of the Company, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and any other material statutory dues applicable to it. There are no arrears of the aforesaid dues as at 31st March, 2011 outstanding for a period of more than six months from the date they became payable. There are no dues towards investor education and protection fund.

(b) As at 31st March, 2011 according to the records of the Company and the information and explanations given to me, there are no dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and cess matters that have not been deposited on account of any dispute.

(x) The Company does not have accumulated losses as at 31st March, 2011 and has not incurred cash losses during the financial year ended on that date and in the immediately preceding financial year.

(xi) In my opinion and according to the information and explanations given to me, the company, during the year, has not defaulted in repayment of dues to financial institutions and banks. There are no debentures as on the balance sheet date.

(xii) According to the information and explanations given to me, the company has given guarantee, for loans taken by Prajay Properties Private Limited from banks or financial institutions, the terms and conditions whereof are not prejudicial to the interest of the company.

(xiii) In my opinion and according to the information and explanations given to me, the term loans were applied for the purposes for which they were obtained.

(xiv) According to the information and explanations given to me, and on an overall examination of the balance sheet of the Company, there are no funds raised on short term basis which have been used for long term investment.

(xv) During the year, the Company has made preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act. The price at which shares have been issued is not prejudicial to the interest of the Company.

(xvi) The Company has not raised any money through a public issue during the year.

(xvii) To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on or by the Company was noticed or reported during the year.

S V RANGAN

Chartered Accountant

Membership No. 022037

Place: Secunderabad

Date: August 30, 2011

---

Mar 31, 2010

1. I have audited the attached Balance Sheet of Prajay Engineers Syndicate Limited, as at March 31,2010 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. My responsibility is to express an opinion on these financial statements based on my audit.

2. I conducted my audit in accordance with auditing standards generally accepted in India. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956,1 enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Attention is drawn to the following:

a. Note B. 18(a) of Schedule 18, in respect of Sundry Debtors, unsecured considered good outstanding for a period of more than six months amounting to Rs.27148.39 lacs. For the reasons stated therein I am unable to comment on the realizations of the aforesaid debtors.

b. Note B.18(b) of Schedule 18, in respect of advances amounting to Rs.8310.62 lacs given towards purchase of land/ development, outstanding from earlier years in respect of which no provision has been made for the reasons stated therein.

5. Subject to paragraph 4(a) and further to my comments in the annexure referred to in paragraph (3) above, I report that:

a) I have obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purposes of my audit;

b) in my opinion, proper books of account as required by law have been kept by the company so far as it appears from my examination of those books;

c) 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;

d) in my opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

e) for recognizing profit on construction project under an agreement to sell, stage of completion is determined as a proportion that contract costs incurred for the work performed bear to the estimated total costs. Similarly contract revenue is recognized under the percentage of completion method measured by survey of work performed. Further, expected loss on contracts is recognized when it is probable that the total contract costs will exceed the total contract revenue. This practice is being consistently followed by the Company. For this purpose, total project/contract costs incurred, and cost to completion of projects/contracts which is arrived at by the management based on current technical data, forecast and estimate of net expenditure to be incurred in future including for contingencies, etc, which being technical matters have been relied upon by me.

f) in my opinion and to the best of my information and according to the explanations given to me, the said accounts, read with the notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2010;

(ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

6. On the basis of written representations received from the directors as on March 31,2010, and taken on record by the Board of Directors, I report that none of the directors is disqualified as on March 31,2010 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 the Auditors Report (Referred to in paragraph 3 of the Auditors Report of even date to the members of Prajay Engineers Syndicate Limited)

The nature of the Companys business/ activities during the year is such that clauses (vi), (xii), (xiii), (xiv), xix) of paragraph 4 of the Companies (Auditors Report) Order, 2003 (CARO) are not applicable to the Company.

(i) In respect of its fixed assets:

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

(b) As explained to me, all the fixed assets are physically verified by the management in a phased periodical manner, which in my opinion is reasonable, having regard to the size of the Company and the nature of its assets. According to the information and explanations given to me, no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in my opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in my opinion, not affected the going concern status of the Company.

(ii) (a) The inventories in respect of hotels and resorts have been physically verified by the management at the year end. In my opinion the frequency of verification is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of my examination of the records of inventory, in my opinion, the Company is maintaining proper records of inventory and the discrepancies noticed on physical verification between the physical stocks and book records were not material in relation to the operations of the Company.

(iii) (a) According to the information and explanations given to me, the Company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 and accordingly clauses iii (b) to iii (d) of paragraph 4 of CARO are not applicable.

(b) According to the information and explanations given to me, the Company has taken unsecured loan from two parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of loan outstanding during the year was Rs.3399.40 lacs and the balance as at the year end is Rs. 3398.61 lacs.

(c) In my opinion and according to the information and explanations given to me.the terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company. There is no interest payable on the loans.

(d) In respect of the loans taken, the principal amounts have not fallen due for payment.

(iv) In my opinion and according to the information and explanations given to me, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchase of inventories and fixed assets and for the sale of goods and services. During the course of my audit, I have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) In my opinion, and according to the information and explanations given to me, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that Section.

(b) In my opinion and according to the information and explanations given to me, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lacs in respect of any party during the year have been made at prices, which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has an internal audit system, the scope and coverage of which needs to be increased to make it commensurate with its size and nature of the business of the Company. t

(vii) I am informed that the Central Government has not prescribed maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956.

(viii) (a) According to records of the Company, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and any other material statutory dues applicable to it. There are no arrears of the aforesaid dues as at 31 st March, 2010 outstanding for a period of more than six months from the date they became payable. There are no dues towards investor education and protection fund.

(b) As at 31 st March, 2010 according to the records of the Company and the information and explanations given to me, there are no dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and cess matters that have not been deposited on account of any dispute.

(ix) The Company does not have accumulated losses as at 31 st March, 2010 and has not incurred cash losses during the financial year ended on that date and in the immediately preceding financial year.

(x) In my opinion and according to the information and explanations given to me, the company, during the year, has not defaulted in repayment of dues to financial institutions and banks. There are no debentures as on the balance sheet date.

(xi) According to the information and explanations given to me, the company has not given any guarantees for loans taken by others from banks or financial institutions.

(xii) In my opinion and according to the information and explanations given to me, the term loans were applied for the purposes for which they were obtained.

(xiii) According to the information and explanations given to me, and on an overall examination of the balance sheet of the Company, there are no funds raised on short term basis which have been used for long term investment.

(xiv) During the year, the Company has made preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act. The price at which shares have been issued is not prejudicial to the interest of the Company.

(xv) The Company has not raised any money through a public issue during the year.

(xvi)To the best of my knowledge and belief and according to the information and explanations given to me, no fraud on or by the Company was noticed or reported during the year.

Place: Secunderabad S V RANGAN

Date: August 14, 2010 Chartered Accountant

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