Auditor Report of Sovereign Diamonds Ltd.

Mar 31, 2025

We have audited the accompanying financial statements of SOVEREIGN DIAMONDS
LIMITED (“the Company”) which comprises the Balance Sheet as at March 31, 2025,
the Statement of Profit and Loss, (including Other Comprehensive Income), Statement
of changes in Equity and statement of cash flows for the year then ended, and notes to
the financial statements, including a summary of material accounting policies and other
explanatory information. (Hereinafter referred to as the “Financial Statements”)

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,
2013 (“the Act”) in the manner so required and give a true and fair view in conformity with
the accounting principles generally accepted in India including Indian Accounting Standards
prescribed under section 133 of the Act, (“Ind AS”) and other accounting principles generally
accepted in India, of the state of affairs of the Company as at March 31,2025, and its profit,
total comprehensive income, changes in equity and its 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 (“SA”s) specified under section 143(10) of the Act. Our responsibilities under those
Standards are further described in the “Auditor''s Responsibilities for the Audit of the Financial
Statements” section of our report. We are independent of the Company in accordance with
the Code of Ethics issued by the Institute of Chartered Accountants of India (“ICAI”) together
with the ethical requirements that are relevant to our audit of the Financial Statements
under the provision of the Act and rules thereunder and we have fulfilled our other ethical
responsibilities in accordance with these requirements and ICAI''s code of ethics. We believe
that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our
audit opinion on the Financial Statements.

Key Audit Matter

We have determined that there are no other key audit matters to communicate in our report.
Information Other than the Financial Statements and Auditor’s Report Thereon

The Company''s Management and Board of Directors are responsible for the other information.
The other information comprises the information included in Company''s Annual Report but
does not include the financial Statements and our auditor''s report thereon. Our opinion on the
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 Financial Statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent
with the 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 and Board of Directors Responsibilities for Financial Statements

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

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

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

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the 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 Financial Statements.

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

(i) Identify and assess the risks of material misstatement of 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.

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

(iii) Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the management and board of
directors.

(iv) Conclude on the appropriateness of management''s and board of director''s use of the
going concern basis of accounting in preparation of financial statement 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 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.

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

Materiality is the magnitude of misstatements in the Financial Statements that,
individually or in aggregate, makes it probable that the economic decision of a
reasonably knowledgeable use 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.

Report on Other Legal and Regulatory Requirements

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

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

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

b) In our opinion, proper books of account as required by law have been kept by the
Company so far as it appears from our examination of those books except for the
matters stated in the paragraph 2(i)(vi) below on reporting under Rule 11(g) of the
Companies (Audit and Auditors) Rules, 2014.

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 books of account.

d) In our opinion, the aforesaid financial statements comply with the Indian Accounting
Standards specified under Section 133 of the Act.

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

f) The modifications relating to the maintenance of accounts and other matters
connected therewith are as stated in the paragraph 2(b) above on reporting under
Section 143(3)(b) of the Act and paragraph 2(i)(vi) below on reporting under Rule
11(g) of the Companies (Audit and Auditors) Rules, 2014.

g) 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, refer to our separate Report in “Annexure B”.

h) With respect to the other matters to be included in the Auditors'' Report in
accordance with the requirements of section 197(16) of the Act, as amended:

In our opinion and to the best of our information and according to the explanations
given to us, the remuneration paid by the company to its directors during the year
is in accordance with the provision of section 197 of the Act.

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

i. The Company has disclosed the impact of pending litigation on its financial
position in its Financial Statements. Refer Note 31 to Financial Statement.

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

iii. There has not been an occasion in case of the Company during the year
under report to transfer any sums to the Investor Education and Protection
Fund. The question of delay in transferring such sums does not arise.

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

and belief, no funds have been advanced or loaned or invested (either
from borrowed funds or share premium or any other sources or kind of
funds) by the Company to or in any other persons 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 to or 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 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, 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 from or on
behalf of the Ultimate Beneficiaries; and

(c) Based on the audit procedures as considered reasonable and
appropriate in the circumstances, nothing has come to our notice that
has caused us to believe that the representations under iv(a) and iv(b)
above contain any material misstatement.

v. The company has not declared and paid dividend during the year and hence
compliance to section 123 is not required.

vi. Based on our examination, which included test checks, the company has
used accounting software for maintaining its books of accounts which has
a feature of recording audit trail (edit log) facility and the same has been
operating throughout the year for all relevant transactions recorded in
respective software and that audit trail was not enabled at the database level
to log any direct data changes. Further, during the course of our audit we
did not come across any instance of audit trail feature being tampered with.
Additionally, the audit trail has been preserved by the Company as per the
statutory requirements for record retention.

FOR J.D. ZATAKIA & COMPANY
CHARTERED ACCOUNTANTS
FIRM REGN. NO. 111777W

J. D. ZATAKIA - PROPRIETOR
Date : 27^th May, 2025 MEMBERSHIP NO. 17669

Place : Mumbai UDIN: 25017669BMJABH7202

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Mar 31, 2024

We have audited the accompanying standalone financial statements of SOVEREIGN DIAMONDS LIMITED (“the Company”) which comprises the Balance Sheet as at March 31, 2024, the Statement of Profit and Loss, (including Other Comprehensive Income), statement of changes in Equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of material accounting policies and other explanatory information. (Hereinafter referred to as the “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 accounting principles generally accepted in India including Indian Accounting Standards prescribed under section 133 of the Act, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, and its profit, total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing (“SA”s) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the 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 ethical requirements that are relevant to our audit of the Standalone Financial Statements and we have fulfilled our other ethical responsibilities in accordance with these requirements and ICAI''s code of ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.

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

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in Company''s Annual Report 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 and Board of Directors Responsibilities for Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) 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, including Other Comprehensive Income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Ind AS specified under 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the Standalone Financial Statements, management and the Board of Directors 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 the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is also 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:

(i) Identify and assess the risks of material misstatement of 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.

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

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

(iv) 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.

(v) 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 decision of a reasonably knowledgeable use of the Standalone 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 Standalone 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.

Report on Other Legal and Regulatory Requirements

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

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

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

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books except for the matters stated in the paragraph 2(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014.

c) The company does not have any branch therefore there is nothing to be reported under this sub-clause.

d) 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 agree with the books of account.

e) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.

f) There are no matters to be reported on financial transaction during the year which may have any adverse effect on the functioning of the company.

g) On the basis of the written representations received from the directors as on 31st March, 2024 taken on record by the Board of Directors, none of the directors is

disqualified as on 31st March, 2024 from being appointed as a director in terms of Section 164 (2) of the Act.

h) The modifications relating to the maintenance of accounts and other matters connected therewith are as stated in the paragraph 2(b) above on reporting under Section 143(3)(b) of the Act and paragraph 2(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014.

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

j) a) With respect to the other matters to be included in the Auditors'' Report in

accordance with the requirements of section 197(16) of the Act, as amended:

In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the company to its directors during the year is in accordance with the provision of section 197 of the Act.

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

i. The Company has disclosed the impact of pending litigation on its financial position in its Standalone Financial Statements. Refer Note 31 to Standalone Financial Statement.

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

iii. There has not been an occasion in case of the Company during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of delay in transferring such sums does not arise.

iv. (a) The Management has represented that, to the best of its

knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other persons 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 to or on behalf of the Ultimate Beneficiaries;

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

any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries; and

(c) Based on the audit procedures as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under subclause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above contain any material misstatement.

v. The company has not declared and paid dividend in the during the year and hence compliance to section 123 is not required.

vi. 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 checks, the company has used accounting software for maintaining its books of accounts which does not have feature of recording audit trail (edit log) facility and hence the question of being operative throughout the year does not arise.

FOR J.D. ZATAKIA & COMPANY CHARTERED ACCOUNTANTS FIRM REGN. NO. 111777W

J. D. ZATAKIA - PROPRIETOR Date : 30^th May, 2024 MEMBERSHIP NO. 17669

Place : Mumbai UDIN: 24017669BKCRSH5202

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Mar 31, 2015

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

Management's Responsibility for the Financial Statements

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

Auditor's Responsibility

3. 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.

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

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

Opinion

6. 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 March 31,2015, its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

7. 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 paragraphs 3 and 4 of the Order.

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

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

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

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements as referred to in Note 26 to the financial statements..

ii. The Company did not have any long-term contracts including derivative contracts; as such the question of commenting on any material foreseeable losses thereon does not arise

iii. There has not been an occasion in case of the Company during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of delay in transferring such sums does not arise

Annexure referred to in paragraph 7 Our Report of even date to the members of SOVEREIGN DIAMONDS LIMITED on the accounts of the company for the year ended March 31, 2015

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

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

b) As explained to us, physical verification of the fixed assets was conducted by management annually, which in our opinion, is reasonable looking to the size of the Company and nature of it's business. According to the information and explanation given to us no material discrepancies were noticed on such verification.

II. a) Physical verification of inventory has been conducted at reasonable intervals by the management.

b) In our opinion and according to the information and explanations given to us, 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 physical verification of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

III. The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Act.

IV. In our opinion and according to the information and explanations given to us, it appears that there are adequate internal control procedures commensurate with the size of Company and the nature of its business with regard to purchase of inventories, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control.

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

VI. The maintenance of cost records has not been prescribed by the Central Government under section 148 of the Companies Act 2013.

VII. a) The Company is regular in depositing undisputed statutory dues including provident fund, income tax, wealth tax, sales tax, employees' state insurance, custom duty and other statutory dues with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, employees' state insurance, custom duty and other statutory liabilities were in arrears as at the last day of the financial year for a period exceeding six months from the date they became payable.

c) There has not been an occasion in case of the Company during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of reporting delay in transferring such sums does not arise.

VIII. The Company has no accumulated losses at the end of the financial year and has not incurred any cash losses during the year covered by our audit and the immediately preceding financial year.

IX. In our opinion and according to information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions or banks.

X. On the basis of information and explanation given to us the Company has not given any guarantee for loans taken by others from banks or financial institution.

XI. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

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

FOR J.D. ZATAKIA & COMPANY CHARTERED ACCOUNTANTS FIRM REGN. NO. 111777W



Place : Mumbai. J. D. ZATAKIA - PROPRIETOR Date : 30th May, 2015 MEMBERSHIP NO. 17669

---

Mar 31, 2014

We have audited the accompanying financial statements of SOVEREIGN DIAMONDS 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

The Company''s 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 notifed under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 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.

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 Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is suffcient 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 Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

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 Section 227 (4A) 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, 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 Balance Sheet, the Statement of profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notifed under the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013.

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

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF SOVEREIGN DIAMONDS LIMITED

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

b) As explained to us, physical verifcation of the fixed assets was conducted by management annually, which in our opinion, is reasonable looking to the size of the Company and nature of it''s business. According to the information and explanation given to us no material discrepancies were noticed on such verifcation.

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

2) a) Physical verifcation of inventory has been conducted at reasonable intervals by the management.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verifcation 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 physical verifcation of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

d) 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 theCompanies Act, 1956. Accordingly, sub-clauses 3(b), 3(c), 3(d) are not applicable to the company.

e) The Company had taken loans from one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 2.42 Lacs and the yearend balance of loans taken were Rs. 2.42 Lacs.

f) There is no stipulation as regards payment of interest and principal amount.

4) In our opinion and according to the information and explanations given to us, it appears that there are adequate internal control procedures commensurate with the size of Company and the nature of its business with regard to purchase of inventories, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control.

5) According to the information and explanations given to us, there are no transactions made in pursuance of contracts/arrangements, that need to be entered into the Register maintained under section 301 of the Companies Act, 1956.

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

7) The Company has no formal internal audit department as such but its control procedures ensure reasonable internal checking of its financial and other records.

8) As informed to us, the company is maintaining cost records as prescribed by the Central Government under section 209 (1) (d) of the Companies Act, 1956. We have not, however made a detailed examination of these records.

9) a) The Company is regular in depositing undisputed statutory dues including provident fund, income tax, wealth tax, sales tax, employees'' state insurance, custom duty and other statutory dues with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, employees'' state insurance, custom duty and other statutory liabilities were in arrears as at the last day of the financial year for a period exceeding six months from the date they became payable.

10) The Company has no accumulated losses at the end of the financial year and has not incurred any cash losses during the year covered by our audit and the immediately preceding financial year.

11) In our opinion and according to information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions or banks.

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

13) The Company is not a chit fund, nidhi, mutual benefit or a society.

14) In our opinion, the Company has not dealt or traded in shares, securities, debentures or other investments during the year.

15) On the basis of information and explanation given to us the Company has not given any guarantee for loans taken by others from banks or financial institution.

16) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

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

18) 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.

19) The Company has no debentures.

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

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



FOR J.D. ZATAKIA & COMPANY

CHARTERED ACCOUNTANTS

FIRM REGN. NO. 111777W

sd/- Place : Mumbai. J. D. ZATAKIA - PROPRIETOR

Date : 26th May, 2014 MEMBERSHIP NO. 17669

---

Mar 31, 2013

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of SOVEREIGN DIAMONDS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2013, the State- ment 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 Com- pany 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 presen- tation 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 is closures 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 circum- stances. 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 the Statement of Profit and Loss, of the Profit for the year ended on that date; and 1c) 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; except as regards provisions for gratuity and leave encashment as required by AS 15 (revised) and as mentioned in Note No. 1:13.

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 AUDITORS'' REPORT REFERRED TO IN PARAGRAPH 3 OF OUR RE- PORT OF EVEN DATE TO THE MEMBERS OF SOVEREIGN DIAMONDS LIMITED

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

b) As explained to us, physical verification of the fixed assets was conducted by management annually, which in our opinion, is reasonable looking to the size of the Company and nature of it''s business. According to the information and explanation given to us no material discrepancies were noticed on such verification.

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

2) a) Physical verification of inventory has been conducted at reasonable intervals by the management.

b) In our opinion and according to the information and explanations given to us, 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 physical verification of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

(3) 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. Accordingly, sub-clauses 3(b), 3(c), 3(d) are not applicable to the company.

b) The Company had taken loans from one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 12.57 Lacs and the yearend balance of loans taken were Rs. 2.42 Lacs.

c) There is no stipulation as regards payment of interest and principal amount.

4) In our opinion and according to the information and explanations given to us, it appears that there are adequate internal control procedures commensurate with the size of Company and the nature of its business with regard to purchase of inventories, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control.

5) a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transac- tions that need to be entered into the register maintained under Section 301 have

been so entered. b) In our opinion and according to the information and explanations given to us, the transactions 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 with the company.

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

7) The Company has no formal internal audit department as such but its control procedures ensure reasonable internal checking of its financial and other records.

8) As informed to us, the company is maintaining cost records as prescribed by the Central Government under section 209 (1) (d) of the Companies Act, 1956. We have not, how- ever made a detailed examination of these records.

9) a) The Company is regular in depositing undisputed statutory dues including provident fund, income tax, wealth tax, sales tax, employees'' state insurance, custom duty and other statutory dues with appropriate authorities. b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, employees'' state insurance, custom duty and other statutory liabilities were in arrears as at the last day of the financial year for a period exceeding six months from the date they became payable.

10) The Company has no accumulated losses at the end of the financial year and has not incurred any cash losses during the year covered by our audit and the immediately preceding financial year

11) In our opinion and according to information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions or banks.

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

13) The Company is not a chit fund, nidhi, mutual benefit or a society.

14) In our opinion, the Company has not dealt or traded in shares, securities, debentures or other investments during the year.

15) On the basis of information and explanation given to us the Company has not given any guarantee for loans taken by others from banks or financial institution.

16) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

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

18) The Company has not made any preferential allotment of shares to parties and compa- nies covered in the Register maintained under section 301 of the Companies Act, 1956.

19) The Company has no debentures.

20 The Company has not raised any money by public issue during the year. 21) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

FOR J.D. ZATAKIA & COMPANY

CHARTERED ACCOUNTANTS FIRM REGN. NO. 111777W

sd/-

Place: Mumbai. (J.D. ZATAKIA - PROPRIETOR)

Date: 25th May, 2013 MEMBERSHIP NO. 17669

---

Mar 31, 2012

1. West have audited the attached Balance Sheet of SOVEREIGN DIAMONDS LIMITED, as at 31st March 2012, the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. 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 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 (Auditor's Report) order 2003, issued by the Central Government of India in terms of sub-section (4A) of section 227 of The Companies Act, 1956, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we enclose hereto a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph (3) above :

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 appears from our examination of those books.

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

d) In our opinion, the Balance Sheet, the Statement of Profit and Loss and Cash Flow statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, to the extent applicable, except as regard provision for gratuity and leave encashment as required by AS 15 (revised) and as mentioned in Note No 1.13.

e) On the basis of written representations received from Directors as on 31st March, 2012 and taker on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2012 from being appointed as Director in terms of Clause (g) of sub-section (1) o: section 274 of the Companies Act, 1956.

In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India.

i. in the case of Balance Sheet of the state of affairs of the Company as at 31s March, 2012.

ii. in the case of the Statement of Profit and Loss, of the Profit of the Company fo: the year ended on that date and

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

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

b) As explained to us, physical verification of the fixed assets was conducted by management annually, which in our opinion, is reasonable looking to the siz of the Company and nature of it's business. According to the information an explanation given to us no material discrepancies were noticed on such verification.

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

2) a) Physical verification of inventory has been conducted at reasonable intervals the management.

b) In our opinion and according to the information and explanations given to us, 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 notice on physical verification of inventory as compared to the book records were no material and have been properly dealt with in the books of account.

(3) a) The Company has not granted any loans, secured or unsecured to companies, firms o other parties, covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, sub-clauses 3(b), 3(c), 3(d) are not applicable to the company.

b) The Company had taken loans from three parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 30.05 Lacs and the yearend balance o loans taken were Rs. NIL.

c) There is no stipulation as regards payment of interest and principal amount.

4) In our opinion and according to the information and explanations given to us, it appears that there are adequate internal control procedures commensurate with the size of Company and the nature of its business with regard to purchase of inventories, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control.

5) a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts/arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 and exceeding the value oi Rs. 5,00,000 in respect of each party during the year have been made at prices which appear reasonable as per information available with the company.

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

7) The Company has no formal internal audit department as such but its control procedures ensure reasonable internal checking of its financial and other records.

8) 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.

9) a) The Company is regular in depositing undisputed statutory dues including provident fund, income tax, wealth tax, sales tax, employees' state insurance, custom duty and other statutory dues with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amount payable in respect of income tax, wealth tax, sales tax, employees' state insurance, custom duty and other statutory liabilities were in arrears as at the last day of the financial year for a period exceeding six months from the date they became payable.

The Company has no accumulated losses at the end of the financial year and has not incurred any cash losses during the year covered by our audit and the immediate preceding financial year.

11) In our opinion and according to information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions or banks

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

13) The Company is not a chit fund, nidhi, mutual benefit or a society.

14) In our opinion, the Company has not dealt or traded in shares, securities, debenture or other investments during the year.

15) On the basis of information and explanation given to us the Company has not given any guarantee for loans taken by others from banks or financial institution.

16) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

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

18) 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.

19) The Company has no debentures.

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

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





FOR J.D. ZATAKIA & COMPANY

CHARTERED ACCOUNTANTS

FIRM REGN. NO. 111777W

Place : Mumbai

Date : 02nd August, 2012

J. D. ZATAKIA - PROPRIETOR MEMBERSHIP NO. 17669

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of SOVEREIGN DIAMONDS LIMITED, as at 31st March, 2011 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company’s management. 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 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 (Auditor’s Report) order 2003, issued by the Central Government of India in terms of sub-section (4A) of section 227 of The Companies Act, 1956, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we enclose hereto a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph (3) above:

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 appears from our examination of those books.

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

d) In our opinion, Balance Sheet, Profit and Loss Account and Cash Flow statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, to the extent applicable, except as regard provision for gratuity and leave encashment as required by AS 15 (revised) and as mentioned in Note No. 1 (g) and 7 and non-provisions for doubtful debts as mentioned in note no. 18.

e) On the basis of written representations received from Directors as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as Director 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 accounts (together with notes there on) 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

ii. in the case of Profit and Loss Account, of the Profit of the Company for the year ended on that date and

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

ANNEXURE TO THE AUDITORS’ REPORT REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF M/S SOVEREIGN DIAMONDS LIMITED

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

b) As explained to us, physical verification of the fixed assets was conducted by management annually, which in our opinion, is reasonable looking to the size of the Company and nature of it’s business. According to the information and explanation given to us no material discrepancies were noticed on such verification.

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

2) a) Physical verification of inventory has been conducted at reasonable intervals by the management.

b) In our opinion and according to the information and explanations given to us, 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 physical verification of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

3) 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. Accordingly, sub-clauses 3(b), 3(c), 3(d) are not applicable to the company.

e) The Company had taken loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 24.28 Lacs and the year end balance of loans taken were Rs. 20.05 Lacs.

f) There is no stipulation as regards payment of interest and principal amount.

4) In our opinion and according to the information and explanations given to us, it appears that there are adequate internal control procedures commensurate with the size of Company and the nature of its business with regard to purchase of inventories, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control.

5) In our opinion, and according to the information and explanations given to us, there are no transactions that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956.

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

7) The Company has no formal internal audit department as such but its control procedures ensure reasonable internal checking of its financial and other records.

8) 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.

9) a) The Company is regular in depositing undisputed statutory dues including provident fund, income tax, wealth tax, sales tax, employees’ state insurance, custom duty and other statutory dues with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, employees’ state insurance, custom duty and other statutory liabilities were in arrears as at the last day of the financial year for a period exceeding six months from the date they became payable.

10) The Company has no accumulated losses at the end of the financial year and has not incurred any cash losses during the year covered by our audit and the immediately preceding financial year.

11) In our opinion and according to information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions or banks.

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

13) The Company is not a chit fund, nidhi, mutual benefit or a society.

14) In our opinion, the Company has not dealt or traded in shares, securities, debentures or other investments during the year.

15) On the basis of information and explanation given to us the Company has not given any guarantee for loans taken by others from banks or financial institution.

16) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

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

18) 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.

19) The Company has no debentures.

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

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

FOR J.D. ZATAKIA & COMPANY CHARTERED ACCOUNTANTS FIRM REGN. NO. 111777W

J. D. ZATAKIA - PROPRIETOR MEMBERSHIP NO. 17669

Place : Mumbai Date : 30th August, 2011

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Mar 31, 2010

1. We have audited the attached Balance Sheet of SOVEREIGN DIAMONDS LIMITED, as at 31st March, 2010 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. 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 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 sub-section (4A) of section 227 of The Companies Act, 1956, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we enclose hereto a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph (3) above :

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 appears from our examination of those books.

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

d) In our opinion, Balance Sheet, Profit and Loss Account and Cash Flow statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, to the extent applicable.

e) On the basis of written representations received from Directors as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2010 from being appointed as Director in terms of Clause (g) of sub-section (1) of section 274 of the Companies Act,1956 except as regard provision for gratuity and leave encashment as required by AS 15 (revised) and as mentioned in Note No. 1 (g) and 7, and non-provisions for doubtful debts as mentioned in note no. 18.

f) In our opinion and to the best of our information and according to the explanations given to us, the accounts (together with notes there on) 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, 2010

ii. in the case of Profit and Loss Account, of the Profit of the Company for the year ended on that date and

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

ANNEXURE TO THE AUDITORS REPORT REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF M/S SOVEREIGN DIAMONDS LIMITED

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

b) As explained to us, physical verification of the fixed assets was conducted by management annually, which in our opinion, is reasonable looking to the size of the Company and nature of its business. According to the information and explanation given to us no material discrepancies were noticed on such verification.

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

2) a) Physical verification of inventory has been conducted at reasonable intervals by the management.

b) In our opinion and according to the information and explanations given to us, 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 physical verification of inventory as compared to the book records were not material and have been properly dealt with in the books of account.

(3) 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. Accordingly, sub-clauses 3(b), 3(c), 3(d) are not applicable to the company.

e) The Company had taken loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 32.82 Lacs and the year end balance of loans taken were Rs. 20.78 Lacs.

f) There is no stipulation as regards payment of interest and principal amount.

4) In our opinion and according to the information and explanations given to us, it appears that there are adequate internal control procedures commensurate with the size of Company and the nature of its business with regard to purchase of inventories, fixed assets, sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control.

5) In our opinion, and according to the information and explanations given to us, there are no transactions that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956.

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

7) The Company has no formal internal audit department as such but its control procedures ensure reasonable internal checking of its financial and other records.

8) 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.

9) a) The Company is regular in depositing undisputed statutory dues including provident fund, income tax,

wealth tax, sales tax, employees state insurance, custom duty and other statutory dues with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, employees state insurance, custom duty and other statutory liabilities were in arrears as at the last day of the financial year for a period exceeding six months from the date they became payable.

10) The Company has no accumulated losses at the end of the financial year and has not incurred any cash losses during the year covered by our audit and the immediately preceding financial year.

11) In our opinion and according to information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions or banks.

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

13) The Company is not a chit fund, nidhi, mutual benefit or a society.

14) In our opinion, the Company has not dealt or traded in shares, securities, debentures or other investments during the year.

15) On the basis of information and explanation given to us the Company has not given any guarantee for loans taken by others from banks or financial institution.

16) According to information and explanation given to us the Company has not obtained term loan during the year.

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

18) 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.

19) The Company has no debentures.

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

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

FOR J.D. ZATAKIA & COMPANY

CHARTERED ACCOUNTANTS

Place : Mumbai.

Date : 29.07.2010 (J.D. ZATAKIA - PROPRIETOR)

MEMBERSHIP NO. 17669