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Nifty 25,966.40 +0.58%

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Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Auditor Report of Precision Electronics Ltd.

Mar 31, 2025

We have audited the accompanying stand-alone financial statements of Precision Electronics Limited ("the
Company"), which comprise the Balance Sheet as at 31st March 2025, the Statement of Profit & Loss (including Other
Comprehensive Income), the Statement of Changes in Equity and the Cash Flow Statement for the year ended, and 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 statements give the information required by the Companies Act, 2013 ("the Act") in the manner so
required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section
133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other
accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March, 2025, the net
loss and total comprehensive income, changes in equity and the cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under
section 143(10) of the Act (SAs).

Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of
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 (ICAI) together with the independence
requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and
the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these
requirements and the ICAI''s Code of Ethics. 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.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, 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. We have determined the matters described below to be the key audit matters to be
communicated in our report.

Key Audit Matters

A. Evaluation of uncertain Sales Tax positions and GST

The Company has uncertain Sales Tax positions and GST including matters under dispute which involves
significant judgment to determine the possible outcome of these disputes. Refer Note 37 to the Standalone
Financial Statements.

Auditor''s Response

We obtained from the Company''s management, details of the status as of 31 March 2025 concerning these tax
assessments and demands for current as well as past years. We assessed the management''s underlying
assumptions in estimating the tax provision and the possible outcome of the disputes to evaluate whether any
change was required to management''s position on these uncertainties.

B. Company''s business model

The existing business model has been impacted by uncertainty due to high dependence on government contracts

which have been going down over the years, resulting in lower capacity utilisation and recurring losses leading to
difficulty in bank financing and increasing dependence on loans from others.

Auditor''s response

The Company has diversified into Tactical infrastructure, Box build Manufacturing Services, System integration
for Defence & Security and Engineering Services which has the potential to give better contributions in the
medium and long term.

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

The Company''s Board of Directors is responsible for the preparation of the other information. The other information
comprises the information included in the Management Discussion and Analysis, Board''s Report including
Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information,
but does not include the standalone financial statements and our auditor''s report thereon.

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

In connection with our audit of 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
statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

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

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the
preparation of these standalone financial statements that give a true and fair view of the financial position, financial
performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with Ind
AS and other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the
Act for

â¢ safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities

â¢ selection and application of appropriate accounting policies

â¢ making judgments and estimates that are reasonable and prudent and

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

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

Auditor''s Responsibilities 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 auditor''s report that includes our
opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these 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:

â¢ 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.

â¢ Obtain an understanding of internal financial controls 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 system in place and the operating
effectiveness of such controls.

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

â¢ 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.

â¢ 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.

Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in
aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial
statements may be influenced.

We consider quantitative materiality and qualitative factors in;

(i) planning the scope of our audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the financial statements.

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 auditor''s report unless law or regulation precludes public disclosure about the matter
or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of
such communication.

Report on Other Legal and Regulatory Requirements

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

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

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief
were necessary for the purposes of our audit.

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 including Other Comprehensive Income, Statement of
Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the relevant
books of account.

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

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.

f) With respect to the adequacy of the internal financial controls with reference to Financial Statements of the
Company and the operating effectiveness of such controls, please refer to our separate Report in "Annexure 2".
Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s
internal financial controls over financial reporting.

g) With respect to other matters to be included in the Auditor''s Report in accordance with the requirements of
section 197(16) of the Act, as amended, in our opinion & to the best of our information & according to the
explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance
with provisions of section 197 of the Act.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone
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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company.

iv. (a) The Management has represented that, to the best of its knowledge and belief, no funds (which are

material either individually or in the aggregate) have been advanced or loaned or invested (either from
borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any
other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether
recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or
invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company
("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate
Beneficiaries;

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

(c) Based on the audit procedures that have been considered reasonable and appropriate in the
circumstances, nothing has come to our notice that has caused us to believe that there presentations
under sub-clause(i) and (ii) of Rule11(e), as provided under (a) and (b) above, contain any material
misstatement.

(d) The reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 is applicable from
1st April 2023

Based on our examination which included test check, except for the instances mentioned below, the
Company has used accounting software for maintaining its books of accounts which have a feature of
recording audit trail (edit log) facility and the same has operated throughout the year for all relevant
transactions recorded in the respective software.

The features of recording audit trail (edit log) facility were not enabled for the software relating to payroll,
Sale Invoice generation, Property, plant and Equipment and Production records.

Further for the periods where audit trail (edit log) facility was enabled and operated throughout the year for
the respective accounting software, we did not come across any instances of the audit trail feature being
tempered with and the audit trail has been preserved by the company as per the statutory requirements for
record retention.

V. The company has not declared or proposed dividend during the year.

For Nemani Garg Agarwal & Co.

Chartered Accountants
Firm Registration No. 010192N

J.M. Khandelwal
Partner

Membership No: 074267
UDIN:25074267BMOXY08307
Place: New Delhi
Dated: 30 May, 2025

Mar 31, 2024

Precision Electronics Limited D-1081, New Friends Colony New Delhi-110025

Opinion

We have audited the accompanying stand-alone financial statements of Precision Electronics Limited ("the Company"), which comprise the Balance Sheet as at31March 2024, the Statement of Profit & Loss ( including Other Comprehensive Income ), the Statement of Changes in Equity and the Cash Flow Statement for the yearended, and 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 statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March, 2024, the Profit and total comprehensive income, changes in equity and the cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs).

Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of 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 (ICAI) together with the independence requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics.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.

Key Audit Matters

financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matters

A. Evaluation of uncertain Sales Tax positions and GST

The Company has uncertain Sales Tax positions and GST including matters under dispute which involves significant judgment to determine the possible outcome of these disputes. Refer Note 37 to the Standalone Financial Statements.

Auditor''s Response

We obtained from the Company''s management, details of the status as of 31 March 2024 concerning these tax assessments and demands for current as well as past years. We assessed the management''s underlying

assumptions in estimating the tax provision and the possible outcome of the disputes to evaluate whether any change was required to management''s position on these uncertainties.

B. Company''s business model

The existing business model has been impacted by uncertainty due to high dependence on government contracts which have been going down over the years, resulting in lower capacity utilisation and recurring losses leading to difficulty in bank financing and increasing dependence on loans from others.

Auditor''s response

The Company has diversified into Tactical infrastructure, Box build Manufacturing Services, System integration for Defence & Security and Engineering Services which has the potential to give better contributions in the medium and long term.

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

The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does not include the standalone financial statements and our auditor''s report thereon.

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

In connection with our audit of 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 statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

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

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with Ind AS and other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for

â¢ safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities

â¢ selection and application of appropriate accounting policies

â¢ making judgments and estimates that are reasonable and prudent and

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

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

Auditor''s Responsibilities 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 auditor''s report that includes our

opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these 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 :

â¢ 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.

â¢ Obtain an understanding of internal financial controls 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 system in place and the operating effectiveness of such controls.

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

â¢ 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.

â¢ 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.

Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced.

We consider quantitative materiality and qualitative factors in ;

(i) planning the scope of our audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the financial statements.

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 auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

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

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

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

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 including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the relevant books of account.

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

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.

f) With respect to the adequacy of the internal financial controls with refrence to Financial Statementsof the Company and the operating effectiveness of such controls, please refer to our separate Report in "Annexure 2". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.

g) With respect to other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended, in our opinion & to the best of our information & according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with provisions of section 197 of the Act.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

iv. (a) The Management has represented that, to the best of its knowledge and belief, no funds (which are

material either individually or in the aggregate) have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, no funds (which are

material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c ) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that there presentations under sub-clause (i) and (ii)ofRule11(e),as provided under (a) and(b)above, contain any material misstatement.

(d) The reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 is applicable from 1st April 2023

Based on our examination which included test check, except for the instances mentioned below, the Company has used accounting software for maintaining its books of accounts which have a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the respective software.

The features of recoding audit trail (edit log) facility were not enabled for the software relating to payroll, Sale Invoice generation, Property, plant and Equipment and Production records.

V. The company has not declared or proposed dividend during the year.

VI. With respect to the matter to be included in the Auditor''s Report under Section 197(16) of the Companies ACT, 2013,

In our opinion and according to the information and explanation 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 Companies Act, 2013. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act..

For Nemani Garg Agarwal & Co.

Chartered Accountants Firm Registration No. 010192N

J.M. Khandelwal Partner

Membership No: 074267 UDIN:24074267BKHGUA5739 Place: New Delhi Dated: 17 May, 2024

Mar 31, 2023

Data Not Available

Mar 31, 2018

Report on the Financial Statements

We have audited the accompanying financial statements of Precision Electronics Limited ("the company"), which comprise the balance sheet as at 31 March 2018, the statement of profit and loss (including other comprehensive income), the statement of cash flows and the statement of changes in equity for the year then ended and a summary of the significant accounting policies and other explanatory information (herein after referred to as " financial statements").

Management''s Responsibility for the Financial Statements

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 financial statements based on our audit.

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and 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 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 Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, including the Ind AS, of the financial position of the Company as at 31 March, 2018, and its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 (''the order''), issued by the Central Government of India in terms of Sub Section (11) of Section 143 of the Act, we give in the Annexure - ''A'' statement on the matters specified in paragraph 3 & 4 of the Order, to the extent applicable.

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 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 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 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 31^st March, 2018, taken on record by the Board of Directors, none of the directors is disqualified as on 31^st March, 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, we report that:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 36 to the financial statements,

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

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

ANNEXURE - 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 financial statements of the Company for the year ended March 31, 2018, we report that:

i) (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 fixed asset has been physically verified by the management during the year and no material discrepancies between the books records and physical fixed assets have been noticed.

ii) (a) The inventories excluding material in transit have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable.

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

iii) The Company has not granted any loans, secured or unsecured, to the 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.

iv) 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.

v) 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 Deposits) Rules, 2015 with regard to the deposits accepted from the public are not applicable.

vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Companies Act, 2013. Therefore the provisions of this clause do not apply.

vii) (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 31^st March 2018 for a period of more than six months from the date on when they become payable.

(b) According to the information and explanations given to us, there are disputed dues of Sales Tax aggregating to Rs. 13,49,432 which have not been deposited as at 31st March, 2018 are mentioned hereunder:

Name of the Statute	Nature of Dues	Period / Year (Rs. in Lakhs)	Amount	Forum Before which dispute is pending
Central Sales Tax Act 1956	Central Sales Tax	2012-2013	10,00,000	Additional Commissioner Sales Tax Appeals
Central Sales Tax Act 1956	Central Sales Tax	2013-2014	2,64,391	Additional Commissioner Sales Tax Appeals
Central Sales Tax Act 1956	Central Sales Tax	2014-2015	1,70,000	Additional Commissioner Sales Tax Appeals

viii) In our opinion and according to information and explanations given to us, the company has not defaulted in repayment of dues to banks or financial institution;

ix) Based upon the audit procedures performed and the information and explanation given by the management, the company has not raised moneys during the year 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.

x) Based upon the audit procedures performed and the information and explanation 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.

xi) Based upon the audit procedures performed and the information and explanation 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.

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

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

xiv) Based upon the audit procedures performed and the information and explanation 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 provision of clause 3 (xiv) of the Order are not applicable to the company and hence not commented upon.

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

xvi) 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 AUDITOR''S REPORT

Report on the 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 Precision Electronics Limited ("the Company") as of March 31, 2018 in conjunction with our audit of the 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 the Institute of Chartered Accountants of India (''ICAI''). 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 judgment, 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, 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 Nemani Garg Agarwal & Co.

Chartered Accountants

Firm Registration No. 010192N

Uday Gupta

Partner

Membership No: 085199

Place: New Delhi

Dated: 28th May, 2018

Mar 31, 2016

INDEPENDENT AUDITORS'' REPORT

The Members of

Precision Electronics Limited D-1081, New Friends Colony New Delhi-110025

Report on the Financial Statements

We have audited the accompanying financial statements of Precision Electronics Limited ("the company"), which comprise the Balance Sheet as at 31^st March 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provision 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 financial statements based on our audit.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March, 2016, and its Loss and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 (''the order''), issued by the Central Government of

India in terms of Sub Section (11) of Section 143 of the Act, we give in the Annexure - ''A'' statement on the matters specified in paragraph 3 & 4 of the Order, to the extent applicable.

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 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 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 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 31^st March, 2016, taken on record by the Board of Directors, none of the directors is disqualified as on 31^st March, 2016, from being appointed as a director in terms of Section 164(2) of the Act.

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 27.1 to the financial statements,

ii. The Company did not have any long-term contracts including derivatives 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 financial statements of the Company for the year ended March 31,2016:

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

ii) (a) The inventories excluding material in transit have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable.

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

vi) We have broadly reviewed the accounts and records maintained by the company pursuant to the rule made by the central government for maintenance of cost records under sub section (1) of section 148 of companies Act, and are the opinion that the prima facie the prescribed accounts and record have been made and maintained. However we have not made a detailed examination of the record with a view to determining whether they are accurate and complete;

vii) (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 31^st March 2016 for a period of more than six months from the date on when they become payable.

(b) According to the information and explanations given to us, there are disputed dues of Income Tax, Service Tax, Entry Tax & Cess aggregating to Rs. 5,84,391 which have not been deposited as at 31^st March, 2016 are mentioned hereunder:

Name of the Statute	Nature of Dues	Period / Year	Amount (Rs. in Lakhs)	Forum Before which dispute is pending
The Central Excise Act 1944	A ailment of Cenvat Credit	04/2009 - 03/2011	1,89,918	Custom Excise and Service Tax Appellate Tribunal
Central Sales Tax Act 1956	Central Sales Tax	2010-2011	34,473	Additional Commissioner Sales Tax Appeals

Central Sales Tax Act 1956	Central Sales Tax	2011-2012	1,25,000	Additional Commissioner Sales Tax Appeals
The Uttar Pradesh Value Added Tax Act, 2008	Value Added Tax	2011-2012	2,35,000	Additional Commissioner Sales Tax Appeals

viii) In our opinion and according to information and explanations given to us, the company has not defaulted in repayment of dues to banks or financial institution;

xii) 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.

xvi) 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.

Report on the 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 Precision Electronics Limited ("the Company") as of March 31,2016 in conjunction with our audit of the 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 the Institute of Chartered Accountants of India (''ICAI''). 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

Meaning of Internal Financial Controls over Financial Reporting

Inherent Limitations of Internal Financial Controls over Financial Reporting

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 Rajendra K. Goel & Co.

Chartered Accountants

FRN-001457N

Place: New Delhi R.K Goel

Date : 21" May, 2016 (Partner)

Membership No: 006154

Mar 31, 2015

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

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provision 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 financial statements based on our audit.

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and 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 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 Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015('the order'), issued by the Central Government of India in terms of Sub Section (11) of Section 143 of the Act, we give in the Annexure - 'A' statement on the matters specified in paragraph 3 & 4 of the Order, to the extent applicable.

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 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 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 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 31st March, 2015, taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 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 our opinion and to the best of our information and according to the explanations given to us, we report that:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 27.1 to the financial statements,

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

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

ANNEXURE -'A' TO INDEPENDENT AUDITORS REPORT

i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The fixed assets have been physically verified by the management at regular intervals. No material discrepancies were noticed during such verification;

ii. (a) The inventories excluding material in transit have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable;

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business;

(c) The Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of Inventories, wherever material, have been properly dealt with in the books of account;

iii. The Company has not granted any loans, secured or unsecured, to the companies, firms and other parties covered in the register maintained under Section 189 of the Companies Act. Accordingly, the provisions of clause (iii)(a) & (b) of the paragraph 3 & 4 of the order are not applicable;

iv. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system;

v. The Company has not accepted any deposit within the meaning of the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under. Therefore the provisions of clause (v) of the paragraph 3 & 4 of the order are not applicable;

vi. We have broadly reviewed the accounts and records maintained by the Company pursuant to the rules made by the Central Government for maintenance of cost records under Sub-Section (1) of Section 148 of the Companies Act, and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However we have not made a detailed examination of the records with a view to determining whether they are accurate and complete;

vii. (a) Undisputed statutory dues including Provident Fund, Employees' State Insurance, and Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and other statutory dues have generally been regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid statutory dues were in arrears as at 31st March 2015 for a period of more than six months from the date they became payable;

(b) According to the records of the Company and explanations given to us, there are disputed dues of Income Tax, Service Tax, Entry Tax & Cess aggregating to Rs. 6,61,591 which have not been deposited. The details of the disputed dues as at 31st March, 2015 are mentioned hereunder:

Name of the Statute Nature of Dues Period / Year

The Central Excise Availment of 04/2009 - 03/2011 Act 1944 Cenvat Credit

Central Sales Tax Central Sales Tax 2010-2011 Act 1956

Central Sales Tax Central Sales Tax 2011-2012 Act 1956

Central Sales Tax Central Sales Tax 2011-2012 Act 1956

The Uttar Pradesh Value Added Tax 2011-2012 Value Added Tax Act, 2008

Name of the Statute Amount Forum Before which (Rs. in Lakhs) dispute is pending

The Central Excise 1,89,918 Custom Excise and Act 1944 Service Tax Appellate Tribunal

Central Sales Tax 34,473 Additional Act 1956 Commissioner Sales Tax Appeals

Central Sales Tax 1,25,000 Additional Act 1956 Commissioner Sales Tax Appeals

Central Sales Tax 77,200 Additional Act 1956 Commissioner Sales Tax Appeals

The Uttar Pradesh 2,35,000 Additional Value Added Tax Commissioner Sales Act, 2008 Tax Appeals

(c) The Company is not required to transfer any amount to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under.

viii. The Company has no accumulated losses and has not incurred cash losses during the financial year covered by our audit; however the company has incurred cash loss in the immediately preceding year.

ix. In our opinion and according to information and explanations given to us, the company has not defaulted in repayment of dues to a Financial Institution or Banks;

x. In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or Financial Institutions;

xi. In our opinion, the term loans have been applied for the purpose for which they were obtained;

xii. Based upon the audit procedures performed and the information and explanations given by the management, we report that no material fraud on or by the company has been noticed or reported during the course of our audit.

For Rajendra K. Goel & Co. Chartered Accountants FRN-001457N

R.K Goel Place: New Delhi (Partner) Date : 28th May, 2015 Membership No: 006154

Mar 31, 2014

We have audited the accompanying financial statements of "Precision Electronics Limited" ("the Company"), which comprise the Balance Sheet as at March 31, 2014, 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 referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate affairs in respect of section 133 of the Companies Act 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

b) in the case of Statement of Profit and Loss, of the Loss for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of corporate affairs in respect of section 133 of the Companies Act 2013;

e) On the basis of written representations received from the directors as on March 31, 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 clause (g) of sub-section (1) of section 274 of the Companies Act, 1956..

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

The Annexure referred to in paragraph 1 under the heading "report on other legal & regulatory requirements" of the our report of even date

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

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The Fixed Assets are physically verified by the management during the year based on a phased programme of verifying all assets over three years, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account;

(c) Fixed assets disposed off during the year, are negligible so as to affect the Company as a going concern;

(ii) (a) As explained to us, inventories have been physically verified during the year by the management at reasonable intervals;

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business;

(c) In our opinion and on the basis of our examination of the records, the Company is generally maintaining proper records of its inventories. No material discrepancy was noticed on physical verification of stocks by the management as compared to book records;

(iii) (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, the provisions of clauses iii (a), iii (b), iii(c) and iii (d) of the order are not applicable to the Company;

(b) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has taken unsecured loan from directors of the company, the maximum amount during the year being Rs 5,47,97,915/- (Previous year Rs. 5,30,97,915/-) and at the year end Rs. 2,23,75,570/- (Previous year Rs. 5,30,97,915/-) covered under the register maintained under Section 301 of the Companies Act, 1956;

(c) In our opinion and having regard to the loan taken by the company , the rate of interest and other terms and conditions wherever stipulated are not prima facie prejudicial to the interest of the company;

(d) Payment of principal amount and interest are also regular as stipulated;

(iv) In our opinion, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets and payment for expenses and for sale of goods. During the course of our audit we have not observed any continuing failure to correct major weaknesses in internal control system;

(v) (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section;

(b) Based on the audit procedures applied by us and according to the information and explanations given to us we are of the opinion that the transaction made in pursuance of contracts/ arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs.5,00,000 in respect of each party during the year have been made at prices which appear reasonable as per information available to the company.

(vi) The Company has not accepted any deposits from the public covered under section 58A and 58AA of the Companies Act, 1956;

(vii) As per information & explanations given by the management, the Company has an internal audit system commensurate with its size and the nature of its business;

(viii) We have broadly reviewed the books of accounts maintained by the company pursuant to the rule made by the Central Government for the maintenance of the cost records under section 209 (I)(d) of the Companies Act, 1956 and are of the opinion prima facie, the prescribed account and records have been made and maintained;

(ix) (a) As per records produced before us and according to the information and explanations given to us the company is generally regular in depositing undisputed statutory dues applicable to it like provident fund, Investor Education & Protection Fund, Employees State Insurance, Income Tax, Customs duty, Excise Duty, Cess etc. with appropriate authorities, and there were no arrears of such dues at the year end which have remained outstanding for a period of more than six months from the date they became payable;

(b) As per records produced before us and according to the information and explanations given to us there are no dues of Income Tax, Sales tax, Customs duty, Wealth Tax, Service tax, Excise Duty or Cess which have not been deposited on account of any dispute;

(x) The Company does not have any accumulated losses at the end of the financial year and has incurred cash losses in the current year. However there is no cash loss in the immediately preceding financial year;

(xi) Based on our audit procedures and on the information and explanation given by the management, we are of the opinion that company has not defaulted in repayment of dues to any financial institution, bank or debenture holders;

(xii) According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities;

(xiii) The Company is not a chit fund or a nidhi /mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 (as amended) is not applicable to the Company;

(xiv) In our opinion the company is not dealing in or trading of shares, debentures and other investments. Accordingly, clause (xiv) of Para 4 of the order is not applicable;

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution;

(xvi) In our opinion & according to the information & explanation given to us, the term loans have been applied for the purpose for which they were raised;

(xvii) According to the information & explanation given to us and an overall examination of the balance sheet of the company, we find that no fund raised on short term basis have been used for long term investment;

(xviii) Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year;

(xix) The Company has no outstanding debentures during the period under audit;

(xx) The Company has not raised any money by public issue during the year;

(xxi) Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management.

For; Rajendra K Goel & Co. Chartered Accountants F.R.N. 001457N

R. K. Goel (Partner) M.No. 006154

Place: New Delhi Dated: 30th May, 2014

Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;

b) in the case of Statement of Profit and Loss, of the profit for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

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

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

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of PRECISION ELECTRONICS LIMITED on the accounts of the company for the year ended 31st March, 2013.

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

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

(b) The Fixed Assets are physically verified by the management during the year based on a phased programme of verifying all assets over three years, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.

(c) Fixed assets disposed off during the year, are negligible so as to affect the Company as a going concern.

(ii) (a) As explained to us, inventories have been physically verified during the year by the management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) In our opinion and on the basis of our examination of the records, the Company is generally maintaining proper records of its inventories. No material discrepancy was noticed on physical verification of stocks by the management as compared to book records.

(iii) (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, the provisions of clauses iii (b), iii(c) and iii (d) of the order are not applicable to the Company.

(e) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has taken unsecured loan from two directors of the company, the maximum amount during the year being Rs. 5,30,97,915/- (Previous year Rs. 4,03,47,915/-) and at the year end Rs. 5,30,97,915/- (Previous year Rs. 4,03,47,915/-) and from a company in which one director of the company was interested maximum amount during the year being Rs. Nil (Previous year Rs. 70,00,000/-) and at the year end Rs. Nil (Previous year Rs. Nil) covered under the register maintained under Section 301 of the Companies Act, 1956.

(f) In our opinion and having regard to the loan taken by the company , the rate of interest and other terms and conditions wherever stipulated are not prima facie prejudicial to the interest of the company.

(g) Payment of principal amount and interest are also regular as stipulated.

(iv) In our opinion, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets and payment for expenses & for sale of goods. During the course of our audit we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) Based on the audit procedures applied by us and according to the information and explanations given to us we are of the opinion that the particulars of the contracts or arrangements referred to section 301 of the Companies Act, 1956 have been entered into the register required to be maintained under that Section. The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to prevailing market price at the relevant time.

(vi) The Company has not accepted any deposits from the public covered under section 58A and 58AA of the Companies Act, 1956.

(vii) As per information & explanations given by the management, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of accounts maintained by the company pursuant to the rule made by the Central Government for the maintenance of the cost records under section 209 (I)(d) of the Companies Act, 1956 and are of the opinion prima facie, the prescribed account and records have been made and maintained.

(ix) (a) As per records produced before us and according to the information and explanations given to us the company is generally regular in depositing undisputed statutory dues applicable to it like provident fund, Income Tax, Customs duty, Cess etc. with appropriate authorities, and there were no arrears of such dues at the year end which have remained outstanding for a period of more than six months from the date they became payable.

(b) As per records produced before us and according to the information and explanations given to us there are no dues of Income Tax, Sales tax, Customs duty, Wealth Tax, Service tax, Excise Duty or Cess which have not been deposited on account of any dispute.

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current year as well as in the immediately preceding financial year.

(xi) Based on our audit procedures and on the information and explanation given by the management, we are of the opinion that company has not defaulted in repayment of dues to any financial institution, bank or debenture holders.

(xii) According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a chit fund or a nidhi /mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 (as amended) is not applicable to the Company.

(xiv) In our opinion the company is not dealing in or trading of shares, debentures and other investments. Accordingly, clause (xiv) of Para 4 of the order is not applicable.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution.

(xvi) In our opinion & according to the information & explanation given to us, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information & explanation given to us and an overall examination of the balance sheet of the company, we find that no fund raised on short term basis have been used for long term investment.

(xviii) Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year.

(xix) The Company has no outstanding debentures during the period under audit.

(xx) The Company has not raised any money by public issue during the year

(xxi) Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management

For; Rajendra K Goel & Co.

Chartered Accountants

F.R.N. 01457N

R. K. Goel

Place: New Delhi (Partner)

Dated: 23.05.2013 M.No. 6154

Mar 31, 2012

1. We have audited the attached Balance Sheet of M/s. PRECISION ELECTRONICS LIMITED, New Delhi as at 31st March 2012, Statement of Profit & Loss and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibilities of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003 as amended by the Companies (Auditor's Report) Amendment order 2004 issued by the Central Government in terms of sub-section (4A) of section 227 of the Companies Act, 1956, and on the basis of such checks as we consider appropriate and according to the information and explanation given to us, we enclose in the Annexure a statement on the matters specified in paras 4 & 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph-3 above we report that:

(a). We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit.

(b). In our opinion, the Company has kept proper books of accounts as required by law so far, as appears from our examination of these books.

(c). The Balance Sheet, Statement of Profit & Loss and Cash Flow Statement dealt with the report are in agreement with the books of accounts.

(d). In our opinion, financial statements have been prepared in accordance with accounting standard referred to in Section 211 (3C) of the Companies Act, 1956

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

(f). In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet, Statement of Profit & Loss and Cash Flow Statement read with Significant Accounting Policies and Notes to financial statements give the information required by the companies act, 1956 in the manner so required and give a true and fair view in conformity with the Accounting principles generally accepted in India:

i) In the case of the Balance Sheet of the state of affairs of the Company as at 31st March, 2012.

ii) In the case of Statement of Profit & Loss of the loss for the year ended on that date.

iii) In the case of Cash Flow Statement, of the Cash Flows for the year ended on that date.

Annexure to the Auditor's Report of Precision Electronics Limited for the year ended on 31st March, 2012 referred to in Paragraph 3 of our report of even date:

1) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) The Fixed Assets are physically verified by the management during the year based on a phased programme of verifying all assets over three years, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.

(c) In our opinion and according to the information and explanations given to us, The Company has sold old fixed assets having a written down value amounting to Rs. 36,61,072/-.

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

(b) In our opinion, the procedure for physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the Company and nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on physical verification were not material and have been properly dealt with in the books of account.

3) (a) In our opinion and according to the information and explanations given to us, the Company has not granted any loans secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(b) The company has taken unsecured loan from two directors of the company in which one director of the company is interested and related party (ies) covered under the register maintained under Section 301.The maximum amount during the year was Rs.4,73,47,915/- (Previous year Rs. 3,40,47,915/-) and at the year end was Rs. (Previous year Rs.3,40,47,915/-). As per the information made available to us the aforesaid loans taken by the company are repayable 2 to 3 years. In our opinion and having regard to the loan taken by the company, the rate of interest and other terms and conditions wherever stipulated are not prima facie prejudicial to the interest of the company. In respect of aforesaid loans and advances there is no overdue amount as at the year end.

4) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls.

5) In respect of transactions entered in the register maintained in pursuance of Section 301 of the Companies Act, 1956:

(a) To the best of our knowledge and belief and according to the information and explanations given to us, the transactions that needed to be entered into the register have been so entered.

(b) In our opinion and according to the information and explanations given to us the transactions made in pursuance of contract/arrangement entered in the register maintained under Section 301 of the Companies Act, 1956, are at prevailing market prices at the relevant time.

6) The Company has not accepted any deposits from the public.

7) The Company has an internal audit system, which, in our opinion, is commensurate with the size and nature of its business.

8) We have broadly reviewed the books of accounts maintained by the company pursuant to the rule made by the Central Government for the maintenance of the cost records under section 209 (I)(d) of the Companies Act, 1956 and are of the opinion pritnafacie, the prescribed account and records have been made and maintained.

9) (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, wealth tax, excise duty, customs duty, service tax and any other statutory dues applicable, during the year with the appropriate authorities. There are no outstanding statutory dues as at 31st March, 2012 for a period of more than six months from the date they become payable.

(b) As at balance sheet date there were no disputed dues of Sales Tax, VAT, Income Tax, Service Tax, Customs Duty, Wealth Tax, Excise Duty and cess.

10) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current year as well as in the immediately preceding financial year.

11) The company has not defaulted in repayment of dues to any banks as at the balance sheet date.

12) The Company has not granted loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13) As explained to us, the provisions of special statute applicable to Chit Fund, Nidhi or Mutual Benefit society are not applicable to the Company.

14) Based on our examination of records and information and the explanations given to us, the Company has not dealt/traded in shares, securities, debentures and other securities during the year.

15) In our opinion and according to the information and explanation given to us, the company has not given any guarantee for loans taken by others from bank or financial institution.

16) To the best of our knowledge and belief and according to the information and explanations given to us the Term Loan taken during the year has been applied for the purpose for which it was obtained.

17) On the basis of information provided by the management and our examination, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

18) The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956.

19) The Company did not have any debentures outstanding during the year.

20) The Company has not raised any money by public issues during the year.

21) To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

for Rajendra K. Goel & Co.

Chartered Accountants FRN: 001457N

Place : New Delhi R.K Goel

Date : May 30, 2012 Partner

Membership no.:6154

Mar 31, 2011

1. We have audited the attached Balance Sheet of M/s. PRECISION ELECTRONICS LIMITED, New Delhi as at 31st March 2011 and the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibilities of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors' Report) (Amendment) Order, 2004 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of such checks as we consider appropriate and according to the information and explanation given to us, we enclose in the Annexure a statement on the matters specified in paras 4 & 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph-3 above we report that:

a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit.

b) In our opinion, the Company has kept proper books of accounts as required by law so far, as appears from our examination of these books.

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

d) In our opinion, financial statements have been prepared in accordance with accounting standard referred to in Section 211(3C) of the Companies Act, 1956.

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet, Profit & Loss Account and Cash Flow Statement read with Accounting Policies and Notes to Accounts as per scheduleÃ16 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 31stMarch, 2011.

ii) In the case of the Profit & Loss Account of the Profit for the year ended on that date.

iii) In the case of Cash Flow Statement, of the Cash Flows for the year ended on that date.

Annexure to the Auditor's Report of Precision Electronics Limited for the year ended on 31" March, 2011 referred to in Paragraph 3 of our report of even date:

1. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) The Fixed Assets are physically verified by the management during the year based on a phased programme of verifying all assets over three years, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed off by the Company during the year.

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

(b) In our opinion, the procedure for physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the Company and nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on physical verification were not material and have been properly dealt with in the books of account.

3. a) In our opinion and according to the information and explanations given to us, the Company has not granted any loans secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) The Company has taken unsecured loan from Directors of the Company covered under the register maintained under Section 301 of the Companies Act, 1956.The maximum amount during the year was Rs. 3,40,47,915/- (Previous year Rs. 2,90,47,915/-) and at the year end was Rs. 3,40,47,915/- (Previous year Rs. 2,90,47,915/-).As per the information made available to us the aforesaid loans taken by the company are repayable on demand. In our opinion and having regard to the loan taken by the company , the rate of interest and other terms and conditions wherever stipulated are not prima facie prejudicial to the interest of the company. In respect of aforesaid loans and advances there is no overdue amount as at the year end.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase ofinventory and fixed assets and sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls.

5. In respect of transactions entered in the register maintained in pursuance of Section 301 of the Companies Act, 1956:

a) To the best of our knowledge and belief and according to the information and explanations given to us, transactions that needed to be entered into the register have been so entered.

b) In our opinion and according to the information and explanations given to us the transactions made in pursuance of contract/arrangement entered in the register maintained under Section 301 of the Companies Act, 1956, are at prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public.

7. The Company has an internal audit system, which, in our opinion, is commensurate with the size and nature of its business.

8. We have broadly reviewed the books of accounts maintained by the Company pursuant to the rule made by the Central Government for the maintenance of the cost records under section 209 (I)(d) of the Companies Act, 1956 and are of the opinion prima facie, the prescribed account and records have been made and maintained. We have not, however carried out a detailed examination of the same.

9. a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, wealth tax, excise duty, customs duty, service tax and any other statutory dues applicable, during the year with the appropriate authorities. There are no outstanding statutory dues as at 31st March, 2011 for a period of more than six months from the date they become payable.

b) As at balance sheet date there were no disputed dues of Sales Tax, VAT, Income Tax, Service Tax, Customs Duty, Wealth Tax, Excise Duty and Cess.

10. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current year as well as in the immediately preceding financial year.

11. The company has not defaulted in repayment of dues to any banks as at the balance sheet date.

12. The Company has not granted loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. As explained to us, the provisions of special statute applicable to Chit Fund, Nidhi or Mutual Benefit society are not applicable to the Company.

14. Based on our examination of records and information and the explanations given to us, the Company has not dealt/traded in shares, securities, debentures and other securities during the year.

15. In our opinion and according to the information and explanation given to us, the Company has not given any guarantee for loans taken by others from bank or financial institution.

16. To the best of our knowledge and belief and according to the information and explanations given to us the Term Loan taken during the year has been applied for the purpose for which it was obtained.

17. On the basis of information provided by the management and our examination, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

18. The Company has not made any preferential allotment of shares to parties or Companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The Company did not have any debentures outstanding during the year.

20. The Company has not raised any money by public issues during the year.

21. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For RAJENDRA K GOEL & CO. CHARTERED ACCOUNTANTS (ER. No. 001457N)

R.K.Goel (Partner) Membership No.6154

Place: New Delhi Date : 18th May 2011

Mar 31, 2010

1. We have audited the attached Balance Sheet of M/s. PRECISION ELECTRONICS LIMITED, New Delhi as at 31st March 2010 and the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibilities of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report)(Amendment) Order, 2004 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of such checks as we consider appropriate and according to the information and explanation given to us, we enclose in the Annexureastatement on the matters specified inparas 4 &5of the said Order.

4. Furtherto our comments intheAnnexure referred toin paragraph-3 above we report that:

a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose ofour audit.

b) In our opinion, the Company has kept proper books of accounts as required by law so far, as appears from our examination ofthese books.

c) The Balance Sheet and Profit & Loss Account and Cash Flow Statement dealt with the report are in agreementwiththebooksofaccounts.

d) In our opinion, financial statements have been prepared in accordance with accounting standard referred to inSection 211 (3C)of the CompaniesAct, 1956.

e) On the basis of the written representations received from the directors and taken on record by the Board of Directors, we report that none of the director is disqualified as on 31st March 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) Inour opinion and to the best of our information and accordingto the explanations given to us, the said Balance Sheet, Profit & Loss Account and Cash Flow Statement read with Accounting Policies and Notes on Accounts as per scheduleÃ14 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 inIndia:

i) In the case ofthe Balance Sheetof the state ofaffairsof the Companyas at31st March, 2010.

ii) In the case ofthe Profit &LossAccount of the Profit for the year endedonthat date.

iii) In the case ofCash Flow Statement,of the Cash Flows for the year ended on that date.

Annexure to the Auditors Report of Precision Electronics Limited for the year ended 31st March, 2010 referred to in Paragraph 3 of our report of even date

1. The Company is maintaining proper records showing full particulars, including quantitative details and situation of its fixed assets. Fixed Assets have been physically verified by the management during the year based on a phased programme of verifying all assets over three years, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such verification were not material and have been properly dealt with in the booksof account. There was no substantial disposalof fixed assets during the year.

2. The management has conducted physical verification of inventory at reasonable intervals. The procedure for 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. The Company is maintaining proper records of inventory. The discrepancies noticed on physical verification were not material and have been properly dealt with inthe books of account.

3. a) In our opinion and according to the information and explanations given to us, the Company has not granted any loans secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. The company has taken unsecured loan from two directors of the company and related party (ies) covered under the register maintained under Section 301.The maximum amount during the year was Rs. 2,90,47,915/- and atthe year end was Rs. 2,90,47,915/-.

b) As per the information made available to us the aforesaid loans taken by the company are repayableondemand.

c) In our opinion and having regard to the loan taken by the company , the rate of interest and other terms and conditions wherever stipulated are not prima facie prejudicial to the interest of the company.

d) In respect of aforesaid loans and advances thereis nooverdue amountas atthe year end.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and sale of goods and services. During the courseof our audit, nomajor weakness has been noticedin the internal controls.

5. In respect of transactions entered in the register maintained in pursuance of Section 301 of the CompaniesAct,1956:

a) To the best of our knowledge and belief and according to the information and explanations given to us, the transactions that needed tobe entered into the register have been soentered.

b) In our opinion and according to the information and explanations given to us the transaction made in pursuance of contract/arrangement entered in the register maintained under Section 301 ofthe CompaniesAct, 1956, areat prevailing market prices atthe relevant time.

6. TheCompanyhas not accepted any deposits from the public.

7. The Company has an internal audit system, which, in our opinion, is commensurate with the size and natureof its business.

8. We have broadly reviewed the books of accounts maintained by the company pursuant to the rule made by the Central Government for the maintenance of the cost records under section 209 (I)(d) of the Companies Act, 1956 and are of the opinion prima facie, the prescribed account and records have beenmade and maintained.

9. a) Accordingto the information and explanations given tous and on the basis of our examination of the books of account, the Company has been generally regular in depositing undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, wealth tax, excise duty, customs duty, service tax and any other statutory dues applicable, during the year with the appropriate authorities. There are no outstanding statutory dues as at 31st March, 2010 for a period of more than six monthsfromthedate they become payable.

b) As at balance sheet date there were no disputed dues of Sales Tax, VAT, Income Tax, Service Tax, Customs Duty,WealthTax,ExciseDutyand cess.

10. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the current year as wellas in the immediately preceding financial year.

11. The company has not defaulted inrepaymentof dues to any banks as at the balance sheet date.

12. The Company has not granted loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. As explained to us, the provisions of special statute applicable to Chit Fund, Nidhi or Mutual Benefit society are not applicable tothe Company.

14. Based on our examination of records and information and the explanations given to us, the Company has not dealt/tradedin shares, securities, debentures and other securities during the year.

15. In our opinion and according to the information and explanation given to us, the company has not given any guarantee for loans taken by others from bankor financial institution.

16. To the best of our knowledge and belief and according to the information and explanations given to us the Term Loan taken during the year has been applied for the purpose for which itwas obtained.

17. On the basis of information provided by the management and our examination, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment and vice versa.

18. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 ofthe Companies Act, 1956.

19. TheCompany did not have any debentures out standing during the year.

20. The Companyhas not raisedany money by public issues duringthe year.

21. To the best of our knowledge and belief and according to the information and explanations given to us, nofraudonor by the Company was noticed or reported during the year.

For RAJENDRA K GOEL & CO. CHARTERED ACCOUNTANTS (Registration No. 001457N)

R.K.Goel Place : New Delhi (Partner)

Date : 27th May 2010 Membership No.6154

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