DIRECTORS’ REPORT

The Members,

Kratos Energy & Infrastructure Ltd.

Your Directors have pleasure in presenting the Annual Report and Audited Statements of Accounts of the Company for the year ended 31st March, 2014.

FINANCIAL RESULTS:

DIVIDEND:

The Directors do not recommend any dividend for the year under consideration.

DIRECTORS

In accordance with the provisions of Companies Act, 2013 and the Articles of the Company, Mr. Taranath C. Kotian retires by rotation at the forthcoming Annual General Meeting, and being eligible, offers himself for re-appointment.

Section 149 of the Companies Act, 2013 requires all listed companies to have atleast one-third of the total number of Directors as Independent Directors and it inter alia stipulates the criteria of independence should a company propose to appoint an Independent Director on its Board. As per the said Section 149, an Independent Director can hold office for a term upto 5 (five) consecutive years on the Board and he shall not be included in the total number of Directors for retirement by rotation. Accordingly, it is proposed to appoint Mr. Irfan Khan as an Independent Director for a term upto 31st March, 2019.

Also, pursuant to the provisions of Section 203 of the Companies Act, 2013 pertaining to appointment of Key Managerial Personnel, Mr. Rajesh Pawar has been subject to approval of shareholders’ approval at the ensuing Annual General Meeting appointed as the Whole Time Director of the Company vide Board Resolution dated 13th August, 2014 to hold office for a period of five years w.e.f. 13th August, 2014.

LISTING OF SECURITIES

The shares of the Company are listed on Bombay Stock Exchange Ltd. and the listing fees for the current year have been paid.

PUBLIC DEPOSIT

During the year under review, your Company has neither accepted nor renewed any deposits within the meaning of section 58A of the Companies Act, 1956.

AUDITORS:

The Company has received a written consent and certificate from M/s. Sadhana D. Shah & Co., Chartered Accountants, Statutory Auditors of the Company to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment. Therefore, pursuant to the provisions of Section 139 of the Companies Act, 2013 and Rules made thereunder, Statutory Auditors of the Company who retire at the ensuing Annual General Meeting are proposed to be re-appointed, to hold office from this Annual General Meeting until the conclusion of Annual General Meeting of the Company to be held for the financial year 2017-18.

AUDITOR’S REPORT

With reference to point 7 of the Annexure of the Auditors Report, the Company would like to state that since the volume of activity is minimal, there is no internal audit system in place.

SECRETARIAL COMPLIANCE CERTIFICATE

The Compliance Certificate received from a practicing Company Secretary in accordance with the provisions of section 383A (1) of the Act read with the Companies (Compliance Certificate) Rules 2001 being attached to the Directors’ Report.

PARTICULARS OF EMPLOYEES:

No employee of the Company was drawing remuneration in excess of the limit prescribed under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 and hence no information is furnished under these provisions.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO

The disclosure of particulars of energy conservation and technology absorption pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are not given as the same are not applicable to the Company.

FOREIGN EXCHANGE DETAILS:

Foreign exchange earnings: NIL

Foreign exchange outgo: NIL.

DIRECTORS’ RESPONSIBILITY STATEMENT:

Pursuant to section 217 (2AA) of the Companies Act 1956, your Directors confirm:-

1) That the applicable accounting standards have been followed in the preparation of annual accounts.

2) That the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of state of affairs of the company at the end of the financial year and of the profit of the company for that period.

3) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safe guarding the assets of the company and for preventing and detecting fraud and other irregularities.

4) That the Directors have prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENT

The Directors take this opportunity to express their thanks and appreciation for the co-operation and assistance received from the Bankers, Government Authorities and other business associates.

COMPLIANCE CERTIFICATE

[Under Section 383A of the Companies Act, 1956 &

Rule 3 of Companies (Compliance Certificate) Rules, 2001]

The Members, Company No: 11-21614

M/s. Kratos Energy & Infrastructure Ltd. Authorised Capital: Rs. 5,00,00,000/-

317, Maker Chambers V, Paid up Capital: Rs. 1,00,00,000/-

221, Nariman Point,

MUMBAI-400 021 .

We have examined the registers, records, books and papers of M/s. KRATOS ENERGY & INFRASTRUCTURE LIMITED as required to be maintained under the Companies Act, 1956 (‘the Act’) and Companies Act, 2013 to the extent applicable and the rules made thereunder and also the provisions contained in the Memorandum and Articles of Association of the Company for the financial year ended on 31st March, 2014 (‘the financial year’). In our opinion and to the best of our information and according to the examinations carried out by us and explanations furnished to us by the Company, its officers and agents, we certify that in respect of the aforesaid financial year:

1. The Company has kept and maintained all registers as stated in Annexure ‘A’ to this certificate, as per the provisions of the Act and the rules made thereunder and all entries therein have been duly recorded.

2. The Company has duly filed the forms and returns as stated in Annexure ‘B’ to this certificate, with the Registrar of Companies, under the Act and rules made thereunder. However, no forms or returns were required to be filed with the Regional Director, Central Government, Company Law Board or other authorities.

3. The Company has the minimum prescribed paid-up capital and the Company being a public limited company, restriction on maximum number of members, subscription for shares and acceptance of deposits are not applicable.

4. The Board of Directors duly met Nine times respectively on 25th April, 2013, 20th May 2013, 21st May 2013, 30th May 2013, 15th July 2013, 14th August 2013, 3rd September 2013, 12th November 2013 and 14th February 2014 in respect of which meetings proper notices were given and the proceedings were properly recorded and signed in the minutes book maintained for the purpose.

5. The Company closed its Register of Members from 27th September 2013 to 30 th September 2013 (both days inclusive) and necessary compliance of Section 91 of the Companies Act, 2013 has been made except giving of newspaper advertisement.

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6. The Annual General Meeting for the financial year ended on 31st March, 2013 was held on 30th September, 2013 after giving notice to the members of the Company as informed to us by the management, however no proof of dispatch of notice was produced before us. The resolutions passed thereat were duly recorded in the Minutes Book maintained for the purpose.

7. No Extra Ordinary General Meeting was held during the financial year ended 31st
March, 2014.

8. The Company has advanced loan to companies referred to in section 295 of the Companies Act, 1956 and Section 185 of the Companies Act, 2013 and not complied with the relevant provisions.

9. The Company has not entered into contracts falling within the purview of Section 297 of the Act.

10. The Company is under the process of making necessary entries in the Register maintained under Section 301 of the Act.

11. As there were no instances falling within the purview of Section 314 of the Act, the Company has not obtained any approvals from the Board of Directors, members or the Central Government as the case may be.

12. The Company has not issued any duplicate Share Certificates during the financial year.

13. The Company:

a. has delivered all share certificates on lodgment thereof for transfer/transmission within the time limit in accordance with relevant provisions of the Act during the financial year.

b. was not required to deposit any amount in a separate Bank Account as no dividend was declared during the financial year.

c. was not required to post warrants for dividend to any member of the company as no dividend was declared during the financial year.

d. was not required to transfer the amounts in unpaid dividend account, application money due for refund, matured deposits, matured debentures and the interest accrued thereon which have remained unclaimed or unpaid for a period of seven years to Investor Education and Protection Fund as there were no such cases.

e. has duly complied with the requirements of Section 217 of the Act.

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14. The Board of Directors of the Company is duly constituted. Mr. Rajesh Pawar and Mr. Taranath Kotian were appointed as Additional Directors w.e.f. 25 th April, 2013 and their appointments were duly regularized in the Annual General Meeting held on 30th September, 2013. There was no appointment of Alternate Director or Director to fill casual vacancy during the financial year.

15. The paid-up capital of the Company being less than Rs. 5.00 crores, provisions of Section 269 of the Act with regard to appointment of Managing Director/Whole-time Director/Manager are not applicable.

16. The Company has not appointed any sole selling agents during the financial year.

17. The Company has not obtained any approval of the Central Government for giving loans to companies referred to in section 295 of the Act. The Company was not required to obtain any approval of Company Law Board, Regional Director, Registrar and/or such authorities prescribed under the various provisions of the Act during the financial year.

18. The Directors have disclosed their interest in other firms/Companies to the Board of Directors pursuant to the provisions of the Act and the rules made thereunder.

19. The Company has not issued any shares, debentures or other securities during the financial year.

20. The Company has not bought back any shares during the financial year.

21. The Company has no preference shares or debentures, and hence the question of redemption does not arise.

22. There were no transactions necessitating the Company to keep in abeyance the rights to dividend, rights shares and bonus shares pending registration of transfer of shares.

23. The Company has not invited/accepted any deposits including any unsecured loans falling within the purview of section 58A during the financial year.

24. The amounts borrowed by the Company are within the limits as prescribed under Section 293(1)(d) of the Companies Act, 1956 and Section 180(1)(c) of the Companies Act, 2013.

25. During the year, the Company has given advances to other body corporates which are not in compliance with the requirements of section 372A of the Act.

26. The Company has not altered the provisions of the Memorandum with respect to situation of the Company’s Registered Office from one state to another during the year under scrutiny.

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27. The Company has not altered the provisions of the Memorandum with respect to the objects of the Company during the year under scrutiny.

28. The Company has not altered the provisions of the Memorandum with respect to change in the name of the Company during the year under scrutiny.

29. The Company has not altered the provisions of the Memorandum with respect to share capital of the Company during the year under scrutiny.

30. The Company has not altered its Articles of Association during the financial year.

31. No prosecutions were initiated or show cause notices received by the Company for alleged offences under the Act.

32. The Company has not received any money as security from its employees during the financial year.

33. The Company has not constituted any Provident Fund u/s. 418 of the Companies Act, 1956 and hence provisions of Section 418 of the Act do not apply to the Company.

For JAYSHREE A. LALPURIA & CO.,

PRACTISING COMPANY SECRETARIES

(Jayshree A. Lalpuria)

Proprietor

ACS: 17629 CP: 7109

Place: Mumbai

Date: 26th May, 2014

KRATOS ENERGY & INFRASTRUCTURE LIMITED

ANNEXURE ‘A’

Registers as maintained by the Company

Sr. No . Name of Register Section/Rule

Under Companies Act, 1956

1. Register of Charges Section 143

2 Register of Members and Index thereto

and share transfer Section 150-151

3 Minutes Book of meetings of Board of Directors and

Committee thereof Section 193

4. Minutes Book of General Meetings.. Section 193

5. Books of Accounts. Section 209

6. Register of Contracts in which Directors are

interested. Section 301(1)

7. Register of Companies, firms in which

directors are interested. Section 301(3)

8. Register giving particulars of Directors,

Managing Director, Manager and Secretary. Section 303

9. Register giving details of Directors Shareholding. Section 307

ANNEXURE ‘B’

Forms and Returns as filed by the Company during the year ended 31st March, 2014

With the Registrar of Companies:

With Regional Director : Nil

With Central Government or other authorities : Nil

For JAYSHREE A. LALPURIA & CO.,

PRACTISING COMPANY SECRETARIES

(Jayshree A. Lalpuria)

Place: Mumbai Proprietor

Date: 26th May, 2014 ACS: 17629 CP: 7109

The disclosure of particulars of energy conservation and technology absorption pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are not given as the same are not applicable to the Company.

Foreign exchange earnings: NIL Foreign exchange outgo: NIL

No employee of the Company was drawing remuneration in excess of the limit prescribed under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 and hence no information is furnished under these provisions.

Pursuant to section 217 (2AA) of the Companies Act 1956, your Directors confirm:- 1) That the applicable accounting standards have been followed in the preparation of annual accounts. 2) That the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of state of affairs of the company at the end of the financial year and of the profit of the company for that period. 3) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safe guarding the assets of the company and for preventing and detecting fraud and other irregularities. 4) That the Directors have prepared the annual accounts on a going concern basis.

With reference to point 7 of the Annexure of the Auditors Report, the Company would like to state that since the volume of activity is minimal, there is no internal audit system in place.