Auditor Report of Raghava Estates & Properties Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of M/s Raghava Estates & Properties Limited, which comprise the Balance Sheet as at 31st March, 2014 and Statement of Profit & Loss for the year ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position and financial performance of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956, ("the Act") (which continue to be applicable in respect of Section 133 of the Company Act, 2013 in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' 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 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 control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the 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 aforesaid 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:

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

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

(c) in case of the cash flow statement, of the cash flows of the company 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 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, 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 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 and Statement of Profit and Loss dealt with by this Report are in agreement with the books of account.

(d) in our opinion, the Balance Sheet and the Statement of Profit and Loss comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs).

(e) On the basis of the written representations received from the directors as on 31 March, 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2014 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

Annexure to the Auditors'' Report:

Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date.

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

(b) We were informed that all the fixed assets of the Company have been physically verified by the management during the year at reasonable intervals and no discrepancies were noticed on such verification.

(c) During the year, the company has not disposed off any part of Plant & Machinery and affect on the going concern status of the company does not arise.

(ii) (a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(b) The procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act. Hence the provisions of Clause 4 (iii) of Companies (Auditors Report) Order, 2003 are not applicable to the company.

(iv) In our opinion and according to the information and explanations 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 fixed assets. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

(v) According to the information and explanations given to us, we are of the opinion that there were no contracts or arrangements that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 and hence the provisions of clause (v) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the company.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

(vii) The company does not have formal internal audit department but the company''s internal control procedures together with the internal checks conducted by the management staff during the year can be considered as an adequate internal audit system commensurate with the size and nature of its business.

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

(ix) (a) The company is regular in depositing with appropriate authorities undisputed statutory dues including, income tax, sales tax, wealth tax, service tax, Provident Fund and other material statutory dues applicable to it. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax. Sales tax, provident fund were in arrears, as at 31st March 2014 for a period of more than six months from the date became payable except Service tax detailed hereunder (b).

(b) According to the information and explanation given to us, there are dues of service tax, which have not been deposited on account of dispute.

Name of the statute Nature of Dues

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Finance Act, 1994 Service Tax on Construction of Residential Complex Service

Name of the statute Amount Period to which Forum where dispute (Rs) the amount relates is pending

Finance Act, 1994 1567840 2006-07 Appellate Tribunal Bengaluru

Finance Act, 1994 171345 01.04.07 to Appellate Tribunal 30.04.07 Bengaluru

Finance Act, 1994 3414656 01.05.07 to Appellate Tribunal 31.03.08 Bengaluru

Finance Act, 1994 2981615 01.04.08 to Appellate Tribunal 28.02.09 Bengaluru

Finance Act, 1994 102989 01.03.09 to Appellate Tribunal 31.03.09 Bengaluru

Finance Act, 1994 972255 2009-10 Appellate Tribunal Bengaluru

Finance Act, 1994 207231 01.04.10 to Appellate Tribunal 30.06.10 Bengaluru

Finance Act, 1994 1085142 01.07.10 to Appellate Tribunal 31.03.11 Bengaluru

(x) In our opinion, there was no accumulated losses and the company has been deriving cash profits during the financial year covered by our audit and the immediately preceding financial year. However it has incurred cash loss during the year immediately preceding the financial year.

(xi) According to the information and explanations given to us, the company had delayed installment towards repayment of secured loan availed from Andhra Pradesh State Financial Corporation. As per the repayment schedule the company is required to repay the availed loan amount of Rs.420 lakhs in 50 Equated Monthly Installments of Rs.9.20 lakhs commencing from June, 2008 ending on July, 2012. However an amount Rs.233.37 lakhs was outstanding as on 31.03.2014 which ought to have been paid before July, 2012. Hence there was delay of 26 Months in repayment.

(xii) 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 provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xv) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loans taken by the company have been applied for the purpose for which they were raised.

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

(xviii) According to the information and explanations given to us, the company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the company has not issued any debentures.

(xx) In our opinion and according to the information and explanations given to us, the company has not raised any funds by Public issue during the year under audit.

(xxi) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for Suresh And Babu Chartered Accountants FRN : 004254S

Place : Vijayawada Sd/- Date : 05.05.2014 (P. Janardhan) Partner. ICAI M. No. 026498

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Mar 31, 2013

We have audited the accompanying financial statements of M/s Raghava Estates & Properties Limited, which comprise the Balance Sheet as at 31st March, 2013 and Statement of Profit & Loss for the year ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position and financial performance of the Company in accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' 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 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 control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the 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 aforesaid 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:

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

(b) in the case of the Statement of Profit and Loss, of the Profit/Loss of the Company 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 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, 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 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 and Statement of Profit and Loss dealt with by this Report are in agreement with the books of account.

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

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

Annexure to the Auditors'' Report:

Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date.

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

(b) We were informed that all the fixed assets of the Company have been physically verified by the management during the year at reasonable intervals and no discrepancies were noticed on such verification.

(c) During the year, the company has not disposed off any part of Plant & Machinery and affect on the going concern status of the company does not arise.

(ii) (a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(b) The procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act. Hence the provisions of Clause 4 (iii) of Companies (Auditors Report) Order, 2003 are not applicable to the company.

(iv) In our opinion and according to the information and explanations 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 fixed assets. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

(v) According to the information and explanations given to us, we are of the opinion that there were no contracts or arrangements that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 and hence the provisions of clause (v) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the company.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

(vii) The company does not have formal internal audit department but the company''s internal control procedures together with the internal checks conducted by the management staff during the year can be considered as an adequate internal audit system commensurate with the size and nature of its business.

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

(ix) (a) The company is regular in depositing with appropriate authorities undisputed statutory dues including, income tax, sales tax, wealth tax, service tax, Provident Fund and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no dues of sales tax, income tax and wealth tax, which have not been deposited on account of any dispute.

(x) In our opinion, there was no accumulated losses and the company has been deriving cash profits during the financial year covered by our audit and the immediately preceding financial year. However it has incurred cash loss during the year immediately preceding the financial year.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

(xii) 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 provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xv) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loans taken by the company have been applied for the purpose for which they were raised.

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

(xviii) According to the information and explanations given to us, the company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the company has not issued any debentures.

(xx) In our opinion and according to the information and explanations given to us, the company has not raised any funds by Public issue during the year under audit.

(xxi) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for Suresh And Babu Chartered Accountants FRN : 004254S

Place : Vijayawada Date : 04.06.2013. Sd/- (P. Janardhan) Partner. ICAI M.No.026498

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Mar 31, 2012

1. We have audited the attached Balance Sheet of M/S. RAGHAVA ESTATE & PROPERTIES LIMITED. as at 31st March, 2012 and also the profit and Loss Account and cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order 2003, issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956, We enclose in the Annexure, a statement on the matters specified in paragraphs 4 & 5 of the said order.

4. Further to our comments in the Annexure referred to 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, proper books of accounts as required by law have been kept by the Company so far as appears from our examination of the books.

c) The Balance Sheet, Profit and Loss Account and cash flow statement dealt with by this report are in agreement with the above books of accounts.

d) In our opinion, the balance sheet, profit and Loss Account and the Cash flow statement dealt with by this report comply with the Accounting standards referred to in section 211(3C) of the Companies Act, 1956.

e) On the basis of written representations received from the directors, as on 31st March, 2012, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31st March, 2012 from being appointed as directors 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 accounts read with notes thereon and significant accounting policies 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 Balance Sheet, of the State of affairs of the Company as at 31st March, 2012 and

ii) In the case of the Profit and Loss accounts of the Profit for the year ended on that date and

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

Referred to in paragraph 3 of our report of even date.

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

b) We were informed that all the fixed assets of the Company have been physically verified by the management during the year as reasonable intervals and no discrepancies were noticed on such verification.

c) There was no disposal of a substantial part of fixed assets during the year.

ii) a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii) The company has neither granted nor taken any loans secured or unsecured to/from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act. Hence the provisions of Clause 4 (iii) of Companies (Auditors Report) Order, 2003 are not applicable to the company.

iv) In our opinion and according to the information and explanations 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, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control.

v) a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 .

b) In our opinion, according to the information and explanations given to us there are transactions which were made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees Five Lacs in respect of any party during the year.

c) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

vi) The company does not have formal internal audit department but the company''s internal control procedures together with the internal checks conducted by the management staff during the year can be considered as an adequate internal audit system commensurate with the size and nature of its business.

vii) We have been informed that the Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the companies Act. 1956 for the company.

viii) a) The company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, income tax, sales tax, excise duty and other material statutory dues applicable to it.

b) According to the information and explanations given to us. no undisputed amounts payable in respect of income tax, wealth tax, sales Tax, Customs duty, excise duty, and cess were in arrears, as at 31st March, 2009 for a period of more than six months from the date they become payable.

c) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any dispute.

ix) In our opinion, there was no accumulated losses and the company has been deriving cash profits during the financial year covered by our audit and the immediately preceeding financial year.

x) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debeture holder.

xi) The company has not granted loans and advances on the basis of security by way of pledge of share, debentures and other securities.

xii) The company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the company.

xiii) In our opinion, the company is not dealing in or trading in shares, securities debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the company.

xiv) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

xv) In our opinion, the term loans have been utilised for the purpose for which they were raised.

xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short term basis have been used for long term investment.

xvii) According to the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to interest of the company

xviii) According to the information and explanations given to us, during the period covered by our audit report, the company has not issued any debentures.

xix) The company has not raised any money by public issue of shares during the year covered by audit.

xx) According to the informant and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for SURESH AND BABU

Chartered Accountants

FRN : 004254S

Place : Vijayawada Sd/-

Date : 02.06.2012 (P. JANARDHAN)

Partner

M.No.26498

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Mar 31, 2011

1. We have audited the attached Balance Sheet of M/S. RAGHAVA ESTATES & PROPERTIES LIMITED, as at 31st March, 2011 and also the profit and Loss Account and cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order 2003, issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956, We enclose in the Annexure, a statement on the matters specified in paragraphs 4 & 5 of the said order.

4. Further to our comments in the Annexure referred to 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, proper books of accounts as required by law have been kept by the Company so far as appears from our examination of the books.

c) The Balance Sheet, Profit and Loss Account and cash flow statement dealt with by this report are in agreement with the above books of accounts.

d) In our opinion, the balance sheet, profit and Loss Account and the Cash flow statement dealt with by this report comply with the Accounting standards referred to in section 211(3C) of the Companies Act, 1956.

e) On the basis of written representations received from the directors, as on 31st March, 2011, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31st March, 2011 from being appointed as directors 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 accounts read with notes thereon and significant accounting policies 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 Balance Sheet, of the State of affairs of the Company as at 31st March, 2011 and

ii) In the case of the Profit and Loss accounts of the Profit for the year ended on that date

and

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

Referred to in paragraph 3 of our report of even date.

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

b) We were informed that all the fixed assets of the Company have been physically verified by the management during the year as reasonable intervals and no discrepancies were noticed on such verification.

c) During the year, the company has not disposed any part of the Plant & Machinery and the question of affect on the going concern status of the company does not arise.

ii) a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii) The company has neither granted nor taken any loans secured or unsecured to/from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act. Hence the provisions of Clause 4 (iii) of Companies (Auditors Report) Order, 2003 are not applicable to the company.

iv) In our opinion and according to the information and explanations 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, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control.

v) a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 .

b)In our opinion, according to the information and explanations given to us there are transactions which were made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees Five Lacs in respect of any party during the year.

c) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

vi) The company does not have formal internal audit department but the company's internal control procedures together with the internal checks conducted by the management staff during the year can be considered as an adequate internal audit system commensurate with the size and nature of its business.

vii) We have been informed that the Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the companies Act. 1956 for the company.

viii) a) The company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, income tax, sales tax, excise duty and other material statutory dues applicable to it.

b) According to the information and explanations given to us. no undisputed amounts payable in respect of income tax, wealth tax, sales Tax, Customs duty, excise duty, and cess were in arrears, as at 31st March, 2011 for a period of more than six months from the date they become payable.

c) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any dispute.

ix) In our opinion, there was no accumulated losses and the company has been deriving cash profits during the financial year covered by our audit and the immediately preceding financial year.

x) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holder.

xi) The company has not granted loans and advances on the basis of security by way of pledge of share, debentures and other securities.

xii) The company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

xiii) In our opinion, the company is not dealing in or trading in shares, securities debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

xiv) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

xv) In our opinion, the term loans have been utilized for the purpose for which they were raised.

xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short term basis have been used for long term investment.

xvii) According to the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to interest of the company

xviii) According to the information and explanations given to us, during the period covered by our audit report, the company has not issued any debentures.

xix) The company has not raised any money by public issue of shares during the year covered by audit.

xx) According to the informant and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for Suresh and Babu Chartered Accountants

Place : Vijayawada

Date : 02.09.2011 (P. Janardhan)

Partner

---

Mar 31, 2010

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

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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

4. Further to our comments in the Annexure referred to above, we report thai:

(i) 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;

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

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

(iv) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred in Section 211(3C) of the Companies Act, 1956.

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

(vi) In our opinion and to the best of our information and according to the explanations given to us. the said accounts read with notes thereon and significant accounting policies give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In the case of the Balance Sheet, of the State of affairs of the Company as at 31st March, 2010; and

b) In the case of the Profit and Loss account, of the Profit for the year ended on that date.

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

Annexure to the Auditors Report : Referred to in paragraph 3 of our report of even date.

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

(b) We were informed that all the fixed assets of the Company have been physically verified by the management during the year at reasonable intervals and no discrepancies were noticed on such verification.

(c) During the year, the company has not disposed any part of the Plant & Machinery and the question of affect on the going concern status of the company does not arise.

(ii) (a) The inventory has been physically verified during the year by tiie management. In our opinion, the frequency of verification is reasonable.

(b) The procedure 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 inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The company has neither granted nor taken any loans secured or unsecured to /from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Hence the provisions of clause 4(iii) of Companies(Audil repor£}order,2003 are not applicable to the Company.

(iv) In our opinion and according to the information and explanations 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, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure lo correct major weaknesses in internal controls.

(v) (a) According to the information and explanations given to us, we are of the opinion that there are no transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, there are transactions which were made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year.

(c) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

(vi) The company does not have formal internal audit department but the companys internal control procedures together with the internal checks conducted by the management stall during the year can be considered as an adequate internal audit system commensurate with the size and nature of its business.

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

(viii) (a) The company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, excise duty and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales lax, customs duty, excise duly, and cess were in arrears, as at 31st March, 2010 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax. excise duty, and cess which have not been deposited on account of any dispute.

(ix) In our opinion, there was no accumulated losses of the company has been deriving cash profits during the financial year covered by our audit and the immediately preceding financial year.

(x) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

(xi) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xii) The company is not a chit fund or a nidhi/mutuai benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

(xiii) In our opinion, the company is not dealing in or trading in shares, securities. debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from bank or financial institutions.

(xv) In our opinion, the term loans have been utilized for the purpose for which they were raised.

(xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term investment.

(xvii) According to the information and explanations given to us, the company has made preferential allotment of shares to parties covered in the register maintained under Section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to the interest of the company.

(xviii) According to the information and explanations given to us, during the period covered by our audit report, the company has not issued any debentures.

(xix) The company has not raised any money by public issue of shares during the year covered under audit.

(xx) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for Suresh And Babu Chartered Accountants Firm Reo.No: 004254S

{P.Janardhan)

Partner

M.No:26498

Place : Vijayawada Date : 02.09.2010

---

Mar 31, 2009

1. We have audited the attached Balance Sheet of M/S. RAGHAVA ESTATES LIMITED, as at 31 st March, 2009 and also the profit and Loss Account and cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order 2003, issued by the Central Government of ffidia in terms of section 227 (4A) of the CompaniesAct, 1956, We enclose in the Annexure, a statement on the matters specified in paragraphs 4 & 5 of the said order.

4. Further to our comments in the Annexure referred to 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, proper books of accounts as required by law have been kept by the Company so far as appears from our examination of the books.

c) The Balance Sheet, Profit and Loss Account and cash flow statement dealt with by this report are in agreement with the above books of accounts.

d) In our opinion, the balance sheet, profit and Loss Account and the Cash flow statement dealt with by this report comply with the Accounting standards referred to in section 211(3C) of the CompaniesAct, 1956.

e) On the basis of written representations received from the directors, as on 31 st March, 2009, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31st March, 2009 from being appointed as directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act 1956.

t)ln our opinion and to the best of our information and according to the explanations given to us, the said accounts read with notes thereon and significant accounting policies give the information required by the companies Act, " 956, 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 Balance Sheet, of the State of affairs of the Company as at 31 st March, 2009 and *

ii) In the case of the Profit and Loss accounts of the Profit for the year ended on that date and

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

ANNEXURE TO THE AUDITORS REPORT

Referred to in paragraph 3 of our report of even date.

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

b) We were informed that all the fixed assets of the Company have been physically verified by the management during the year as reasonable intervals and ho discrepancies were noticed on such verification.

c) During the year, the company has not disposed any part of the Plant & Machinery and the question of affect on the going concern status of the company does not arise.

ii) a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii) a) The company has not granted any loans secured or unsecured to Companies firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. The recovery and interest as stipulated are regular and the maximum amounts involved during the year was Rs. 1,27,63,875/- with M/s. R.P. Transporters and Rs. 1,79,22,400/- with M/s. PANC Transporters (both of which are group firms). However, the outstanding balance as on reporting date is nil.

iv) In our opinion and according to the information and explanations 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, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control.

v) a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956

b) In our opinion, according to the information and explanations given to us there are no transactions which were made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees Five Lacs in respect of any party during the year.

c) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public.

vi) The company does not have formal internal audit department but the companys internal control procedures together with the internal checks conducted by the management staff during the year can be considered as an adequate internal audit system commensurate with the size and nature of its business.

vii) We have been informed that the Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the companies Act. 1956 for the company.

viii) a) The company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, income tax, sales tax, excise duty and other material statutory dues applicable to it.

b) According to the information and explanations given to us. no undisputed amounts payable in respect of income tax, wealth tax, sales Tax, Customs duty, excise duty, and cess were in arrears, as at 31 st March, 2009 for a period of more than six months from the date they become payable.

c)According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any dispute.

ix) In our opinion, there was no accumulated losses and the company has been deriving cash profits during the financial year covered by our audit and the immediately proceeding financial y¥ar. ^~

x) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debeture holder.

xi) The company has not granted loans and advances on the basis of security by way of pledge of share, debentures and other securities.

xii) The company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

xiii) In our opinion, the company is not dealing in or trading in shares, securities debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors , Report) Order, 2003 are not applicable to the company.

xiv) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

xv) In our opinion, the term loans have been utilised for the purpose for which they were raised.

xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short term basis have been used for long term investment.

xvii) According to the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to interest of the company ,

xviii) According to the information and explanations given to us, during the period covered by our audit report, the company has not issued any debentures.

xix) The company has not raised any money by public issue of shares during the year covered by audit.

xx) According to the informant and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for SURESH AND BABU

Chartered Accountants

Place: Vijayawada Date: 1 -09-2009 (P.JANARDHAN)

Partner