Managements Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true aid Fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, read with the General Circular 15/2013 dated 13th September. 2013 of the Ministry of Corporate Affairs in respect of Section 1.13 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 tree 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 risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances; but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimate 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.

In our opinion and to the best of our information and according to She 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 31st March, 2014;

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2003, as amended, issued by the Central Government of India in terms of sub-section (4 A) 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, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956; notified 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 31st March, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March,. 2014 from being appointed as a director in terms of clause (g) of subsection (1) of section 274 of the Companies Act, 1956,

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURE TO THE AUDITOR'S REPORT

ANNEXURE REFERRED TO IN PARAGRAPH 2 OF OUR AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH, 2014 OF MRUG ESH TRADING LIMITED.

On the basis of such checks as we considered appropriate and in terms of the information and explanations given to us, we state that;

1. Since there are no fixed assets with the Company, the question of maintaining records in respect thereof and physical verification of the same, does not arise.

2. (a) As explained to us, the Company has inventories of only Shares which have been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable having regard to the size of the Company and the nature of its business,

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

(c) The company has maintained proper records of inventory. As explained to us, there were no material discrepancies noticed on physical verification of stocks, as compared to book records.

3. a) The Company has not granted any loans, secured or unsecured to companies , firms or other parties covered in the register to be maintained under Section 301 of the Companies Act, 1956 and hence the disclosure under "b, c & d" are not applicable,

b) The company has not taken loans & advances from companies, firms or other parties covered under the Register maintained under section 301 of the Companies Act. Accordingly sub-clauses `f & `g' of Clause (iii) are not applicable,

4. In our opinion, and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the sale of the Company and the nature of its business for the sale of goods. In our opinion and according to the information and explanations given to us, there is no continuing failure to correct major weaknesses in internal control.

5. As explained to us there has not been any transaction during the year that need to be entered in the register maintained under section 301 of the Companies Act 1956 and exceeding during the year to Rs. 5,00,000 or more in respect of each such party,

6. The Company has not accepted deposits from the public and hence the provisions of Section 58A and 58AA of the Companies Act, 1956, and the Rules framed there under are not applicable.

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

8. The Central Government has not prescribed maintenance of cost records under Section 209(3)(d) of the Companies Act, 1956.

9. a) According to the information and explanations given to us, there are no undisputed statutory dues payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess which are outstanding as at 31.03,2014 for a period of more than six months from the date they became payable.

b) The Company has a demand for payment of Custom Duty for am amount of Rs.14,61,831/- which is disputed by the Company for which the Company has filed a Suit in the Hon'ble High Court, Kolkata in 1988, which is still pending, However, against the said liability the Company has issued Bank Guarantees From Indian Bank, Strand Road, Kolkata in favour of the Assistant Collector of Customs, Kolkata for which the said Rank is holding 100% margin in the form of Fixed Deposits.

10. The Company has accumulated losses at (the end of Financial Year, but the same is less than 50% of its net worth, which is within the prescribed limit as mentioned in Clause 4 of Companies (Auditors' Report) Order, 2003. The Company has not incurred cash loss during the year or in the immediately preceding financial year.

11. The Company has not obtained any loans from financial institutions or bank or debenture holders and hence the question of default does not arise.

12. The company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities of a similar nature and hence maintenance of documents and records relating to such items are not applicable,

13. The company is not a chit fund, nidhi or mutual benefit fund/Society. Hence the requirements of item (xiii) of paragraph 4 of the Order is not applicable to the company,

14. The company has kept adequate records of its transactions and contracts in shares, securities, debentures and other investments and timely entries have been made therein, The shares, securities, debentures and other investments, are held in the name of the company or are in process of being transferred in the company's name.

15. 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.

16. As per information and explanations given to us, the Company has not raised any funds on long term basis.

17. According to the information and explanations given to us, and on an overall examination of the Balance Sheet and Cash Flow Statement of the Company, we report that no funds raised on short-term basis have been used for long-term investments and no long-term funds have been used to finance short-term assets.

18. According to the information and explanations given to us no preferential allotment of shares has been made by the company to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956,

19. The company has not issued any debentures. Hence the requirements of clause (xix) of paragraph 4 of the Order is not applicable to the company.,

20. The Company has not raised any money through a public issue during the year,

21. Based upon the audit procedures performed for the purpose of reporting true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

                                                  For I. G. NA1K & CO.,
                                                  Chartered Accountants
                                        (Firm Registration No- 106810W)

                                                             I. G. NAIK
Place: Mumbai                                                PROPRIETOR
Dated: 30th May, 20J4                             Membership No. 034504