SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 ________________________________
  FORM
10-K


x
                ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(D)OF
      THE SECURITIES ACT OF 1934For
      the fiscal year ended September 30,
2009
 
 OR
 
 o
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(D)OF
      THE SECURITIES ACT OF 1934
 
 Commission
File Number: 000-53238
 
 CEMTREX,INC.
 
 (Exact
name of registrant as specified in its charter)
 
 Delaware
                
                30-0399914(State or other jurisdiction of
                
                (IRS Employer Identification No.)Incorporation or organization)
 
 19
Engineers Lane,
 Farmingdale,
New York 11735
 (Address,
including zip code, of principal executive offices)
 
 631-756-9116
 (Registrant’s
telephone number, including area code)
 
 Securities
registered pursuant to Section 12(b) of the Act:
  Title of Each Class
                  
                  Name of Each Exchange on Which
      RegisteredCommon
      Stock, $0.001 par value per share
  Securities
registered pursuant to Section 12(g) of the Act: None
  Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes  ̈ No x
  Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Exchange Act. Yes  ̈ No x
  Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes xNo  ̈
  Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  ̈
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
  Large accelerated filer  ̈
                
                Accelerated
      filer  ̈Non-accelerated
      filer  ̈
                
                Smaller reporting company x(Do
      not check if a smaller reporting company)
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes  ̈ No x
  As of
January 8, 2010, the aggregate market value of the registrant’s common stock
held by non-affiliates of the registrant was $4,253,990 based on the average bid
and asked price of $0.43 on January 8, 2010.
  As of
January 8, 2010, the registrant had 39,722,862 shares of common stock
outstanding.
  Documents
incorporated by reference: None.
  
 
 Index
 
 Part ICautionary Statement Regarding Forward-Looking
      StatementsItem
      1
                      Business
                      2Item
      1A
                      Risk Factors
                      11Item
      2
                      Properties
                      15Item
      3
                      Legal Proceedings
                      15Item
      4
                      Submission of Matters to a Vote of Security
      Holders
                      15Part IIItem
      5
                      Market for Registrant’s Common Equity, Related
      Shareholder Matters and Issuer Purchases of Equity
      Securities
                      15Item
      6
                      Selected Consolidated Financial
      Data
                      16Item
      7
                      Management’s Discussion and Analysis of Financial
      Condition and Results of Operations
                      16Item
      7A
                      Qualitative and Quantitative Disclosures about
      Market Risk
                      20Item
      8
                      Financial
      Statements and Supplementary Data
                      20Item
      9
                      Changes in and Disagreements with Accountants on
      Accounting and Financial Disclosure
                      20Item
      9A
                      Controls and Procedures
                      20Item
      9B
                      Other
      Information
                      21Part IIIItem
      10
                      Directors, Executive Officers and Corporate
      Governance
                      21Item
      11
                      Executive Compensation
                      22Item
      12
                      Security Ownership of Certain Beneficial Owners
      and Management and Related Stockholder Matters
                      24Item
      13
                      Certain Relationships and Related Transactions,
      and Director Independence
                      25Item
      14
                      Principal Accounting Fees and
      Services
                      26Part IVItem
      15
                      Exhibits and Financial Statements
      Schedules
                      26
  1
  FORWARD-LOOKING
STATEMENTS
 
 Statements
in this report may be "forward-looking statements." Forward-looking statements
include, but are not limited to, statements that express our intentions,
beliefs, expectations, strategies, predictions or any other statements relating
to our future activities or other future events or conditions. These statements
are based on current expectations, estimates and projections about our business
based, in part, on assumptions made by management. These statements are not
guarantees of future performance and involve risks, uncertainties and
assumptions that are difficult to predict. Therefore, actual outcomes and
results may, and are likely to, differ materially from what is expressed or
forecasted in the forward-looking statements due to numerous factors, including
those described above and those risks discussed from time to time in this
report, including the risks described under "Risk Factors" and any risks
described in any other filings we make with the SEC. Any forward-looking
statements speak only as of the date on which they are made, and we do not
undertake any obligation to update any forward-looking statement to reflect
events or circumstances after the date of this report.
 
 Our
discussion and analysis of our financial condition and results of operations are
based upon our financial statements, which have been prepared in accordance with
accounting principles generally accepted in the United States. The preparation
of these financial statements requires us to make estimates and judgments that
affect the reported amounts of assets, liabilities, revenues and expenses. On an
on-going basis, we evaluate these estimates, including those related to useful
lives of real estate assets, cost reimbursement income, bad debts, impairment,
net lease intangibles, contingencies and litigation. We base our estimates on
historical experience and on various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. There can be no assurance that actual
results will not differ from those estimates.
  PART I
  ITEM
1.    BUSINESS
 
 Cemtrex
Inc. ("Cemtrex" or the "Company") is a Delaware corporation that
designs,  engineers, assembles and sells emission monitoring equipment
and instruments through its MIP division to measure opacity, mercury, sulfur
oxides, hydrocarbons, nitrogen oxides, ammonia, carbon dioxide and oxygen in
flue gases discharging the stacks in industries such
as:  chemicals,  pulp and paper, steel, power, cement,
coal  and  petrochemical.   Cemtrex provides
consulting services on projects that create carbon credits, and also markets
technologies for controlling greenhouse gases such as Methane from coal mines.
Company sells energy efficiency product called Green DCV, which creates energy
efficiency in an existing HVAC system in commercial and industrial facilities by
monitoring carbon dioxide levels.  The Company through its Griffin
Filters subsidiary, supplies air filtration and environmental control systems
for industrial applications.
 
 On April
27, 1998, the Company was incorporated in the state of Delaware under the name
“Diversified American Holdings, Inc.”  The Company subsequently
changed its name to “Cemtrex Inc.” on December 16, 2004.
 
 On April
30, 2007, the Company purchased all of the issued and outstanding membership
interests of Griffin Filters LLC, (“Griffin”) a company established since 1971
and engaged in the design, engineering & supplying of industrial air
filtration equipment from its President & Chief executive officer, Arun
Govil, who was the 100% owner of  the issued and outstanding
membership interests of Griffin.  The purchase price of $ 2,750,000.00
was paid by  (i) paying cash of $700,000.00, (ii) issuing 20,000,000
shares of common stock valued at $750,000.00 and (iii) issuing a four year
convertible debenture in the amount of $1,300,000.00, paying interest of 8.0%
per year and convertible into 30,000,000 shares of common stock. Griffin had
sales and net income of $3,297,409 and $145, 981 respectively for fiscal year
ended September 30, 2006. Griffin is now a wholly-owned subsidiary of the
Company.
  2
  On
September 8, 2009, the Company entered into a letter agreement with Arun Govil,
the Chairman, Chief Executive Officer, Treasurer and President of the Company.
Pursuant to the letter agreement Arun Govil agreed to cancel the convertible
promissory note, held by him, dated April 30, 2007 (the " Note
").  The principal balance of the Note was $1,300,000. Pursuant to the
terms of the Note, the outstanding amount was convertible into 30,000,000 shares
of our common stock. Pursuant to the letter agreement, in return for cancelling
the Note, the Company issued Arun Govil 2,500,000 shares of our common stock and
1,000,000 shares of our Series A Preferred Stock.  Pursuant to the
Certificate of Designation of the Preferred Stock, each issued and outstanding
Preferred Stock shall be entitled to the number of votes equal to the result of:
(i) the number of shares of Common Stock issued and outstanding at the time of
such vote multiplied by 1.01; divided by (ii) the total number of Preferred
Stock issued and outstanding at the time of such vote, at each meeting of
shareholders of the Company with respect to any and all matters presented to the
shareholders of the Company for their action or consideration, including the
election of directors. In consideration of the issuance of the Common Stock and
Preferred Stock described above, Mr. Govil agreed to forfeit 27,500,000 shares
of our common stock issuable as per the original terms of the Note.
 
 The
Company designs, engineers, assembles and sells emission monitoring equipment
and instruments to the chemicals, pulp and paper, steel, power, coal and
petrochemical industries, as well as to municipalities, hospitals, and state and
federal governments. Our emission monitoring systems are installed at the
exhaust stacks of industrial facilities and are used to measure the outlet flue
gas concentrations of regulated pollutants, such as sulfur dioxide, hydrogen
chloride, hydrogen sulfide, nitrous oxides, ammonia, nitrogen oxide, carbon
dioxide, carbon monoxide and other regulated pollutants. Through use of our
equipment and instrumentation, our clients can monitor the exhausts to the
atmosphere from their facilities and comply with Environmental Protection Agency
and state and local emission regulations on dust, particulate, fumes, acid gases
and other regulated pollutants into the atmosphere.
 
 The
Company is also involved in providing turnkey services for carbon credit
projects from abatement of greenhouse gases pursuant to Kyoto protocol and
assists project owners in selling of carbon credits globally. Carbon Credits are
emission offsets that are generated from greenhouse gases abatement, renewable
energy such as solar & wind, and energy efficiency projects which displace
carbon emissions from traditional fossil fuel sources like coal, oil or gas with
the subsequent reduction in greenhouse gas emissions. Companies, agencies and
governments buy, sell, bank and trade Carbon Credits called Certified Emission
Reductions or CERs.   Cemtrex provides consulting services for
such projects and arranges for investment equity and the sales of CERs for its
customers. Company also markets MCDR technology for generating carbon credits
from control of Methane from coal mines.
 
 Company
has recently developed an energy efficiency product line named Green
DCV,  which provides  energy efficiency in HVAC systems for
commercial buildings and industrial installations. Cemtrex’s Green-DCV system
uses carbon dioxide (CO2) sensors to monitor CO2 levels inside a building, and
then regulate the HVAC air-handling system to save energy and improve air
quality. Cemtrex Green-DCV can provide significant   energy
savings in buildings where occupancy fluctuates during a 24-hour period, such
as: office buildings, government facilities, shopping malls, movie theaters,
restaurants & schools.
 
 Company
through its subsidiary griffin Filters provides a complete line of air
filtration and environmental control equipment to industries such as: chemical,
cement, steel, food, construction, mining, & petrochemical. Griffin’s
equipment is used to: (i) remove dust, corrosive fumes, mists, hydrocarbons,
volatile organic compounds, submicron particles and particulate from industrial
exhausts and boilers; (ii) clean noxious and acid gases such as sulfur dioxide,
hydrogen chloride, hydrogen sulfide,
chlorides,  and  organics from  industrial exhaust
stacks prior to discharging to the atmosphere; (iii) control emissions of coal,
dust, sawdust, phosphates, flyash, cement, carbon black, soda ash, silica, etc.
from construction facilities, mining operations and dryer exhausts.
 
 INDUSTRY
BACKGROUND
 
 The
market for environmental control systems and technologies is directly dependent
upon governmental regulations and their enforcement. During the past three
decades, federal, state and local governments have realized the contaminated air
poses significant threats to public health and safety, and, in response, have
enacted legislation designed to curb emissions of a variety of air
pollutants.  Management believes that the existence of governmental
regulations creates demand for Company’s emission monitoring equipment and
environmental control systems.
  3
  These
governmental regulations affect nearly every industrial activity. The principal
federal legislation that was created is the Clean Air Act of 1970, as amended
9th Clean Air Act). This legislation requires compliance with ambient air
quality standards and empowers the Environmental Protection Agency (EPA) to
establish and enforce limits on the emissions of various pollutants from
specific types of facilities. The states have primary responsibility for
implementing these standards and, in some cases, have adopted standards more
stringent than those established by the EPA. In 1990, amendments to the Clean
Air Act were adopted which address, among  other things, the country
acid rain problem by imposing strict control on the emissions of sulfur dioxide
from power plants.  During 1997, EPA approved regulations for ozone
related emissions and in 1998 EPA issued regulations requiring utilities in 22
states to significantly reduce Nitrogen oxides emissions.
 
 According
to scientists, the Earth's surface has risen in temperature by about 1 degree
Fahrenheit in the past century. There is increasing evidence that certain human
activities are contributing to this change in temperature through activities
that increase the levels of greenhouse gases, primarily carbon dioxide, methane,
and nitrous oxide, in the atmosphere. Greenhouse gases trap heat that would
normally escape back into the atmosphere, thus increasing the Earth's natural
greenhouse effect and increasing temperature over time.
 
 The
Earth's climate is predicted to change because human activities are altering the
chemical composition of the atmosphere through the buildup of greenhouse
gases—primarily carbon dioxide (CO2), methane
(CH4),
and nitrous oxide (NOx). The
heat-trapping property of these gases is undisputed. Although uncertainty exists
about exactly how Earth's climate responds to these gases, global temperatures
are rising.
 
 EPA
Clean Air market Programs
 
 EPA’s
Clean air market programs include various market-based regulatory programs
designed to improve air quality. Clean air markets include various market-based
regulatory programs designed to improve air quality by reducing outdoor
concentrations of fine particles, sulfur dioxide, nitrogen oxides, mercury,
ozone and other significant air emissions. The most well-known of these programs
are EPA’s Acid Rain
Program and the NOxTrading Programs,
which reduce emissions of sulfur dioxide (SO2) and
nitrogen oxides (NOx)–compounds
produced by fossil fuel combustion.
 
 Acid
Rain Program
 
 The goal
of the Acid Rain Program is to achieve significant environmental and public
health benefits through reductions in emissions of sulfur dioxide (SO2) and
nitrogen oxides (NOx), the
primary causes of acid rain. To achieve this goal at the lowest cost to society,
the program employs both traditional and innovative, market-based approaches for
controlling air pollution. In addition, the program encourages energy efficiency
and pollution prevention.
 
 "Acid
rain" is a broad term referring to a mixture of wet and dry deposition
(deposited material) from the atmosphere containing higher than normal amounts
of nitric and sulfuric acids. The precursors, or chemical forerunners, of acid
rain formation result from both natural sources, such as volcanoes and decaying
vegetation, and man-made sources, primarily emissions of SO2
and NOxresulting from fossil fuel combustion. In the United States, roughly 2/3
of all SO2 and 1/4 of
all NOx come from
electric power generation that relies on burning fossil fuels, like coal. 
Acid rain occurs when these gases react in the atmosphere with water, oxygen,
and other chemicals to form various acidic compounds. The result is a mild
solution of sulfuric acid and nitric acid. When sulfur dioxide and nitrogen
oxides are released from power plants and other sources, prevailing winds blow
these compounds across state and national borders, sometimes over hundreds of
miles.
  4
  NOx
Trading Program
 
 The goal
of the NOx Trading Program is to reduce the transport of ground-level ozone
across large distances. The Ozone Transport Commission
(OTC) NOxBudget Program was
implemented from 1999 to 2002 and was replaced by the NOxBudget Trading
Program—also known as the “NOx SIP
Call”—in 2003. The NOxSIP
Call  Program is a market-based cap and trade program created
to reduce emissions of nitrogen oxides (NOx) from
power plants and other large combustion sources in the eastern United States.
NOx is a prime ingredient in the formation of ground-level ozone (smog), a
pervasive air pollution problem in many areas of the eastern United States. The
NOx
Budget Trading Program was designed to reduce NOx emissions
during the warm summer months, referred to as the ozone season, when
ground-level ozone concentrations are highest.
 
 Clean Air Interstate Rule
(CAIR)
 
 On March
10, 2005, EPA issued the Clean Air Interstate Rule (CAIR). This rule provides
states with a solution to the problem of power plant pollution that drifts from
one state to another. CAIR covers 28 eastern states and the District of
Columbia. The rule uses a cap and trade system to reduce the target
pollutants—sulfur dioxide (SO2) and
nitrogen oxides (NOx)—by 70
percent.
 
 The goal
of the Clean Air Interstate Rule (CAIR) is to permanently cap emissions of
SO2
and NOx in the
eastern U.S. States must achieve the required emission reductions using one of
two compliance options: (1) meet the state’s emission budget by requiring power
plants to participate in an EPA-administered interstate cap and trade system, or
(2) meet an individual state emissions budget through measures of the state’s
choosing.
 
 Clean Air Mercury Rule
(CAMR)
 
 On March
15, 2005, EPA issued the Clean Air Mercury Rule (CAMR) to permanently cap and
reduce mercury emissions from coal-fired power plants for the first time ever.
This rule makes the United States the first country in the world to regulate
mercury emissions from utilities.
 
 The goal
of the Clean Air Mercury Rule (CAMR) is to reduce mercury emissions from
coal-fired power plants through “standards of performance” for new and existing
utilities and a market-based cap and trade program.
 
 CAMR
establishes “standards of performance” limiting mercury emissions from new and
existing coal-fired power plants, and creates a market-based cap and trade
program that will reduce nationwide utility emissions of mercury in two distinct
phases. The first phase cap is 38 tons and emissions will be reduced by taking
advantage of “co-benefit” reductions—that is, mercury reductions achieved by
reducing sulfur dioxide (SO2) and
nitrogen oxides (NOx) emissions
under Clean Air
Interstate Rule (CAIR). In the second phase, due in 2018, coal-fired
power plants will be subject to a second cap, which will reduce emissions to 15
tons upon full implementation.
 
 EPA
Emission Monitoring Requirements
 
 EPA’s
emissions monitoring requirements are designed to ensure the compliance with its
current regulations pursuant to various programs. The emission monitoring
requirements ensure that the emissions data collected is of a known, consistent,
and high quality, and that the mass emissions data from source to source are
collected in an equitable manner. This is essential to support the Clean Air
Markets Program’s mission of promoting market-based trading programs as a means
for solving air quality problems
 
 Continuous
emissions monitoring (CEM) is instrumental in ensuring that the mandated
reductions of SO2, NOxmercury
and other pollutants are achieved. While traditional emissions limitation
programs have required facilities to meet specific emissions rates, the current
Program requires an accounting of each ton of emissions from each regulated
unit. Compliance is then determined through a direct comparison of total
annual  emissions reported by CEM and allowances held for the
unit.
  5
  CEM is
the continuous measurement of pollutants emitted into the atmosphere in exhaust
gases from combustion or industrial processes. EPA has established requirements
for the continuous monitoring of SO2,
volumetric flow, NOx, diluent
gas, and opacity for units regulated under the Acid Rain Program. In addition,
procedures for monitoring or estimating carbon dioxide (CO2) are
specified. The CEM rule also contains requirements for equipment performance
specifications, certification procedures, and recordkeeping and
reporting.
 
 The Acid
Rain Program uses a market-based approach to reduce SO2 emissions
in a cost-effective manner. (One allowance is an authorization to emit 1 ton of
SO2
during or after a specified calendar year; a utility may buy, sell, or hold
allowances as part of its compliance strategy.) Complete and accurate emissions
data are key to implementing this market-based approach.
 
 An
essential feature of smoothly operating markets is a method for measuring the
commodity being traded. The CEM data supplies the gold standard to back up the
paper currency of emissions allowances. The CEM requirements, therefore,
management believes instills confidence in the market-based approach by
verifying the existence and value of the traded allowance.
 
 The owner
or operator of a unit regulated under the Acid Rain Program must install CEM
systems on the unit unless otherwise specified in the regulation. CEM systems
include:
 ·
              An
      SO2
      pollutant concentration monitor.
 ·
              A
      NOx
      pollutant concentration monitor.
 ·
              A
      volumetric flow monitor.
 ·
              An
      opacity monitor.
 ·
              A
      diluent gas (O2 or
      CO2)
      monitor.
 ·
              A
      computer-based data acquisition and handling system (DAHS) for recording
      and performing calculations with the
data.
 
 All CEM
systems must be in continuous operation and must be able to sample, analyze, and
record data at least every 15 minutes. All emissions and flow data will be
reduced to 1-hour averages. The rule specifies procedures for converting the
hourly emissions data into the appropriate units of measure.
 
 The
following is a summary of monitoring method requirements and
options:
 ·
              All
      existing coal-fired units serving a generator greater than 25 megawatts
      and all new coal units must use CEMs for SO2,
      NOx,
      flow, and opacity.
 ·
              Units
      burning natural gas may determine SO2 mass
      emissions by: (1) measuring heat input with a gas flowmeter and using a
      default emission rate; or (2) sampling and analyzing gas daily for sulfur
      and using the volume of gas combusted; or (3) using
  CEMs.
 ·
              Units
      burning oil may monitor SO2 mass
      emissions by one of the following
methods:
 1.
              daily
      manual oil sampling and analysis plus oil flow meter (to continuously
      monitor oil usage)
 2.
              sampling
      and analysis of diesel fuel oil as-delivered plus oil flow
      meter
 3.
              automatic
      continuous oil sampling plus oil flow
meter
 4.
              SO2 and
      flow CEMs.
 ·
              Gas-fired
      and oil-fired base-loaded units must use NOx
      CEMs.
 ·
              Gas-fired
      peaking units and oil-fired peaking units may either estimate NOx
      emissions by using site-specific emission correlations and periodic stack
      testing to verify continued representativeness of the correlations, or use
      NOx
      CEMS. The emission correlation method has been significantly streamlined
      in the revised rule.
 ·
              All
      gas-fired units using natural gas for at least 90 percent of their annual
      heat input and units burning diesel fuel oil are exempt from opacity
      monitoring.
 ·
              For
      CO2 all
      units can use either (1) a mass balance estimation, or (2) CO2
      CEMs, or (3) O2 CEMs
      in order to estimate CO2
      emissions.
  6
  PRODUCTS
 
 The
Company’s MIP division offers a range of products and systems, incorporating
diverse technologies, to address the needs of a wide variety of industries and
their environmental regulations. Management believes that the Company provides a
single source responsibility for design, engineering, assembly, installation and
maintenance of systems to its customers. The Company’s products are designed to
operate so as to allow its users to determine their compliance with the latest
governmental emissions regulations.  The Company’s products measure
the concentrations of various regulated pollutants in the flue gases discharging
the exhaust stacks at various utilities and industries.
 
 The MIP
division’s current products include the following:
 
 Opacity
monitor: Compliance & non-compliance types
 
 Management
believes that the Company’s Laser Opacity monitor provides the highest accuracy
and long-term reliability available for stack opacity and dust
measurements.  An EPA-compliant monitoring system, the monitor is a
lightweight, efficient solution for determining opacity or dust concentration in
stack gases.  Proven in many installations worldwide, it advances the
state of opacity monitoring with higher levels of accuracy, flexible
installation and reduced long-term maintenance
 
 Extractive
Continuous Emission Monitors (CEMS)
 
 Cemtrex
provides direct-extractiveanddilution-extractive
CEMS  equipment & systems that are applicable for utilities,
industrial boilers, FGD systems, SCR-NOx control, furnaces, gas turbines,
process heaters, incinerators, and process controls.  In addition to
traditional CEMS designed for maximum reliability and minimal maintenance in
monitoring criteria pollutants, the Company can also accurately quantify other
gaseous compounds through in-situ or extractive FTIR systems. The Company’s
Extractive CEMS can be configured to monitor for one or all of the following: •
NOx • SO2 • CO2 • O2 • CO • THC • Mercury • H2S • HCl & HF Acid • NH3 •
Particulate • Opacity • Volumetric Flow and Moisture.
 
 Ammonia
Analyzer
 
 The flue
gas stream which contain ammonia, nitrogen oxides and in some cases sulfur
dioxide utilize Ultra Violet radiation techniques for measurements. All these
components absorb UV radiation, and therefore can be monitored by process
analyzers that utilize UV absorbance techniques for detection.
 
 Mercury
Analyzer
 
 The EPA
Clean Air Mercury rule requires that all coal fired power plants must provide
continuous mercury monitoring by 2009. Management believes that Cemtrex's SM4
mercury monitor, a result of 10 years experience in mercury monitoring business,
provides reliable online measurements at a much lower cost than any other
competing model in the market. Cemtrex SM4 is the first instrument working on a
thermo catalytic principle avoiding wet chemical sample treatment. As a
consequence, the Company has found that maintenance demand has been drastically
minimized. We believe that it is the only monitor that required no maintenance
at a coal fired utility wet stack, no carrier gases, no water and 95% data
availabilitySM4 uses straight extractive Teflon sheathed Hastelloy probe with no
plugging or corrosion.
 
 The
Company ‘s carbon Credits division  provides consulting
services  for carbon credit projects from abatement of greenhouse
gases pursuant to Kyoto protocol and assists project owners in developing such
projects globally. Carbon Credits are emission offsets that are generated from
greenhouse gases abatement, renewable energy such as solar & wind, and
energy efficiency projects which displace carbon emissions from traditional
fossil fuel sources like coal, oil or gas with the subsequent reduction in
greenhouse gas emissions. Companies, agencies and governments buy, sell, bank
and trade Carbon Credits called Certified Emission Reductions or
CERs.   Company provides complete services such as registering
the project to be eligible to generate carbon credits and  arrange for
the required funding.  Company also markets MCDR technology for
generating carbon credits from control of Methane from coal
mines.
  7
  Company’s
energy Efficiency division  has recently developed an energy
efficiency product line named Green DCV,  which
provides  energy efficiency in HVAC systems for commercial buildings
and industrial installations. Cemtrex’s Green-DCV system uses carbon dioxide
(CO2) sensors to monitor CO2 levels inside a building, and then regulate the
HVAC air-handling system to save energy and improve air quality. Cemtrex
Green-DCV can provide significant   energy savings in buildings
where occupancy fluctuates during a 24-hour period, such as: office buildings,
government facilities, shopping malls, movie theaters, restaurants &
schools.
 
 Company
through its subsidiary griffin Filters provides a complete line of air
filtration and environmental control equipment to industries such as: chemical,
cement, steel, food, construction, mining, & petrochemical. Griffin’s
equipment is used to: (i) remove dust, corrosive fumes, mists, hydrocarbons,
volatile organic compounds, submicron particles and particulate from industrial
exhausts and boilers; (ii) clean noxious and acid gases such as sulfur dioxide,
hydrogen chloride, hydrogen sulfide,
chlorides,  and  organics from  industrial exhaust
stacks prior to discharging to the atmosphere; (iii) control emissions of coal,
dust, sawdust, phosphates, flyash, cement, carbon black, soda ash, silica, etc.
from construction facilities, mining operations and dryer exhausts.
 
 PRODUCT
DEVELOPMENT
 
 The
Company is currently in the process of developing technology for economically
controlling carbon dioxide emissions from power plant flue gases that already
have installed wet limestone scrubbers utilizing a proprietary chemical. Company
is carrying out an in-house  pilot test program to develop this
technology for carbon dioxide reduction.
 
 The
Company is not dependent on, nor expects to become dependent on, any one or a
limited number of suppliers.  The Company buys parts and components to
assemble its equipment and products. The Company does not manufacture or
fabricate its own products or systems.  The Company relies on
sub-suppliers and third party vendors to procure from or fabricate its
components based on its design, engineering and specifications. The Company also
enters into subcontracts for field installation, which the Company supervises;
and Company manages all technical, physical and commercial aspects of the
performance of the Company contracts. To date, the Company has not experienced
difficulties either in obtaining fabricated components and other materials and
parts or in obtaining qualified subcontractors for installation
work.
 
 PARTS,
REPAIR AND REFURBISHMENT SERVICES
 
 The
Company also provide  replacement  and
spare  parts  and  repair  and  refurbishment
services for our emission monitoring systems following the expiration of our
warranties  which  generally range up to  12
months. The Company has experienced only minimal costs from its
warranties.
 
 The
Company’s standard terms of sale disclaim any liability for consequential or
indirect losses or damages stemming from any failure of our products or systems
or any component thereof.  The Company seeks indemnification from its
subcontractors for any loss, damage or claim arising from the subcontractors'
failure to perform.
 
 COMPETITION
 
 The
Company faces substantial competition in each of its principal
markets.  Most of its competitors are larger and have greater
financial resources than the Company; several are divisions of multi-national
companies. The Company competes on the basis of price, engineering and
technological expertise, know-how and the quality of our products, systems and
services.  Additionally, the Company’s management believes that the
successful performance of the Company’s installed products and systems is a key
factor in gaining business as customers typically prefer to make significant
purchases from a company with a solid performance history.
  8
  We obtain
virtually all our contracts through competitive bidding. Although price is an
important factor and may in some cases be the
governing  factor,  it is not always determinative, and
contracts are often awarded on the basis of the
efficiency  or  reliability  of  products  and  the  engineering  and  technical
expertise of the bidder.  Several companies market products that compete
directly with our products.  Other companies offer products that
potential customers may consider to be acceptable alternatives to our products
and services.  We face direct competition from companies with far
greater financial, technological, manufacturing and personnel resources,
including Thermo Fisher Scientific Inc., Tekran Instruments Corporation, Altech
Environment USA, Shaw Group, and Horiba Instruments Inc. in the emissions
monitoring business.
 
 INTELLECTUAL
PROPERTY
 
 Over the
years, the Company has developed proprietary technologies that give us an edge
in competing with its competitors. Thus, the Company relies on a combination of
trade secrets and know-how to protect its intellectual property. The Company has
not filed any patents.
 
 MARKETING
 
 The
Company relies on manufacturing representatives, distributors, direct
salespersons, magazine advertisements, internet advertising, trade shows, trade
directories and catalogue listings to market our products and services. The
Company uses more than eight manufacturing sales representatives in the United
States backed by our senior management and technical professionals. The
Company’s arrangements with independent sales representatives accord each a
defined territory within which to sell some or all of
our  products  and  systems,  provide  for
the payment of  agreed-upon  sales
commissions  and
are  terminable  at  will.  The
Company’s sales representatives do not have authority to execute contracts on
the Company’s behalf.
 
 The
Company’s sales representatives also serve as ongoing liaison function between
us and our customers during the installation phase of our products and systems
and address customers' questions or concerns arising thereafter. The Company
selects representatives based upon industry reputation, prior sales performance
including number of prospective leads generated and sales closure rates, and the
breadth of territorial coverage, among other criteria.
 
 Technical
inquiries received from potential customers are referred to our engineering
personnel. Thereafter, the Company’s sales and engineering personnel jointly
prepare a budget for future planning, a proposal, or a final bid.  The
period between initial customer contact and issuance of an order is generally
between two and twelve months.
 
 CUSTOMERS
 
 The
Company’s principal customers are engaged in refining, power, chemical, mining
and metallurgical processing. Historically, most of our customers have purchased
individual products or systems which, in many instances, operate in conjunction
with products and systems supplied by others. For several years, the Company has
marketed its products as integrated custom engineered emission monitoring
systems and environmental management solutions. No one single customer accounts
for a large percentage of our annual sales.
 
 On most
projects, the Company is responsible to its customers for all phases of the
design, assembly, supply and, if included, field installation of its products
and systems. The successful completion of a project is generally determined by a
successful operational test of the supplied equipment conducted by our field
service technician in the presence of the customer.
  9
  TECHNOLOGY
 
 The
Company has developed a broad range of emission monitoring technological
base.  The Company’s equipment and instruments are used: (i) to
measure particulate, carbon dioxide, nitrogen oxides, mercury and sulfur dioxide
from coal-fired power plants, (ii) to measure particulate from cement plants,
(iii) to measure hydrocarbons, particulate and sulfur dioxide from refineries,
(iv) to measure hydrogen sulfide, carbon monoxide, ammonia, hydrocarbons and
other regulated pollutants from chemical plants, steel plants, incinerators and
other industrial exhausts. Our emission monitors are capable of meeting all
current federal and local emission monitoring standards.  Company also
markets technologies for control of Methane from coal mines and creating energy
efficiency in HVAC systems through monitoring of carbon dioxide for commercial
buildings and industrial installations.  The Company has not filed any
patents with respect to its technology.
 
 BONDING
AND INSURANCE
 
 While
only a very few of our contracts require the Company to procure bid and
performance bonds, such requirements are prevalent for large projects or
projects  partially or fully funded by federal, state or local
governments. A bid bond guarantees that a bidder will execute a contract if it
is awarded the job and a performance bond guarantees performance of the
contract.  The Company does not presently have a bank credit line to
back bid or performance bonds. Thus, the Company cannot bid on certain
contracts.
 
 In
certain cases, the Company is able to secure large contracts by accepting
progress payments with retention provisions in lieu of bonds.
 
 The
Company currently maintains different types of insurance, including general
liability and property coverage.  The Company does not maintain
product liability insurance with respect to its products and
equipment.  Management believes that the insurance coverage that it is
adequate for our current business needs.
 
 GOVERNMENT
REGULATION
 
 Significant
environmental laws, particularly the Federal Clean Air Act, have been enacted in
response to public concern about the environment. The Company believe that
compliance with and enforcement of these laws and regulations create the demand
for our products and systems and largely determine the level of expenditures
that customers will make to monitor the emissions from their facilities. The
Federal Clean Air Act, initially adopted in 1970 and extensively amended in
1990, requires compliance with ambient air quality standards and empowers the
EPA to establish and enforce limits on the emission of various pollutants from
specific types of industrial facilities. States have primary responsibility for
implementing these standards, and, in some cases, have adopted more stringent
standards.
 
 The 1990
amendments to the Federal Clean Air Act require, among other matters, reductions
in the emission of sulfur oxides, believed to be the cause of "acid rain," in
the emission of 189 identified hazardous air pollutants and toxic substances and
the installation of equipment and systems which will contain certain named toxic
substances used in industrial processes in the event of sudden, accidental,
high-volume releases. Such amendments also extend regulatory coverage to many
facilities previously exempt due to their small size and require the EPA to
identify those industries which will be required to install the mandated control
technology for the industry to reduce the emission of hazardous air pollutants
from their respective plants and facilities. The Montreal Protocol, adopted in
1987, as well as EPA regulations issued in 1992, call for the phase-out of CFCs.
In addition, regulations promulgated by the EPA in 1993 further limit the
concentration of pollutants, such as hydrogen chloride, sulfur dioxide,
chlorine, heavy metals and hazardous solid substances in the form of extremely
fine dust, from sewage sludge incinerators. Sewage sludge facilities are
required to comply with these regulations. Compliance with all these regulations
can only be achieved by first monitoring the pertinent emission
levels.
  10
  EMPLOYEES
 
 The
Company employs 18 full time and three part time employees, consisting of four
executive officers, three managers, six technical engineers, and five clerical
and administrative support persons.  None of our employees are
represented by a labor union. In addition, the Company utilizes commission sales
personnel and contract design engineers, on an as needed basis. There are no
employment agreements.
 
 FACILITIES
 
 The
Company does not own any real estate.
 
 The
Company leases its principal office at Farmingdale, New York, 4000 square feet
of office and warehouse/shop space in a single story commercial structure on a
month to month lease from Ducon Technologies Inc., at a monthly rental of
2,157.00. The Company’s subsidiary Griffin Filters LLC leases approx. 10,000 sq.
ft. of office and warehouse space in Liverpool, New York from a third party in a
five year lease at a monthly rent of $ 4,858.00 expiring on March 30,
2012.  The Company has no plans to acquire any property in the
immediate future. The Company believes that its current facilities are adequate
for its needs through the next six months, and that, should it be needed,
suitable additional space will be available to accommodate expansion of the
Company's operations on commercially reasonable terms, although there can be no
assurance in this regard. There are no written agreements.
 
 ITEM
1A.       RISK FACTORS
 
  Investing in our common stock
involves a high degree of risk. You should consider carefully the risks and
uncertainties described below, together with all of the other information in
this report, including the consolidated financial statements and the related
notes appearing at the end of this annual report on Form 10-KSB, with
respect to any investment in shares of our common stock. If any of the following
risks actually occurs, our business, financial condition, results of operations
and future prospects would likely be materially and adversely affected. In that
event, the market price of our common stock could decline and you could lose all
or part of your investment.
 
 RISKS
RELATED TO OUR BUSINESS
 
 o    We
are substantially dependent upon the success and market acceptance of our
technology. The failure of the emissions monitoring and controls market to
develop as we anticipate, would adversely affect our business.
 
 The
Company's success is largely dependent on increased market acceptance of our
emission monitoring equipment and control systems. If acceptance of emissions
monitoring equipment does not continue to grow, then the Company’s revenues may
be significantly reduced.
 
 oIf
we are unable to develop new products, our competitors may develop and market
products with better features that may reduce demand for our potential
products.
 
 The
Company may not be able to introduce any new products or any enhancements to its
existing products on a timely basis, or at all.  In addition, the
introduction by the Company of any new products could adversely affect the sales
of certain of its existing products. If the Company's competitors develop
innovative emissions testing technology that are superior to the Company's
products or if the Company fails to accurately anticipate market trends and
respond on a timely basis with its own innovations, the Company may not achieve
sufficient growth in its revenues to attain profitability.
 
 oWe
have income for the fiscal year ending September 30, 2009, but we may not incur
income for the foreseeable future.
 We had
net income of $118,078 for the fiscal year ended September 30, 2008.
We  continue to incur significant expenditures related to research and
development, selling and marketing and general and administrative activities as
well as capital expenditures and anticipate that our expenses and losses may
increase in the foreseeable future as we expand our business however, for the
year ended September 30, 2009, we generated a profit of
$155,010.  Further, as a public company we will also incur significant
legal, accounting and other expenses that we did not incur as a private company.
To maintain profitability, we will need to generate significant additional
revenues with significantly improved gross margins. It is uncertain whether we
will be able to maintain our  profitability.
  11
  oThe
Company faces constant changes in governmental standards by which our products
are evaluated.
 
 The
Company believes that, due to the constant focus on the environment and clean
air standards throughout the world, a requirement in the future to adhere to new
and more stringent regulations both domestically and abroad is possible as
governmental agencies seek to improve standards required for certification of
products intended to promote clean air.  In the event our products
fail to meet these ever-changing standards, some or all of our products may
become obsolete.
 
 oThe
future growth of our business depends, in part, on enforcement of existing
emissions-related environmental regulations and further tightening of emission
standards worldwide.
 
 The
Company expects that the future business growth will be driven, in part, by the
enforcement of existing emissions-related environmental regulations and
tightening of emissions standards worldwide.  If such standards do not
continue to become stricter or are loosened or are not enforced by governmental
authorities, it could have a material adverse effect on our business, operating
results, financial condition and long-term prospects.
 
 o We may incur
substantial costs enforcing our proprietary information, defending against
third-party patents, invalidating third-party patents or licensing third-party
intellectual property, as a result of litigation or other proceedings relating
to patent and other intellectual property rights.
 
 The
Company considers its technology and procedures proprietary.  In
particular, the Company depends substantially on its flexibility to develop
custom engineered solutions for various applications and be responsive to
customer needs.  The Company has not filed for any patents for its
technologies.
 
 The
Company may be notified of claims that it has infringed a third party's
intellectual property.  Even if such claims are not valid, they could
subject the Company to significant costs. In addition, it may be necessary in
the future to enforce the Company's intellectual property rights to determine
the validity and scope of the proprietary rights of others. Litigation may also
be necessary to defend against claims of infringement or invalidity by
others.  An adverse outcome in litigation or any similar proceedings
could force the Company to take actions that could harm its business. These
include: (i) ceasing to sell products that contain allegedly infringing
property; (ii) obtaining licenses to the relevant intellectual property which
the Company may not be able to obtain on terms that are acceptable, or at all;
(iii) indemnifying certain customers or strategic partners if it is determined
that the Company has infringed upon or misappropriated another party's
intellectual property; and (iv) redesigning products that embody allegedly
infringing intellectual property. Any of these results could adversely affect
the Company's business, financial condition and results of operations. In
addition, the cost of defending or asserting any intellectual property claim,
both in legal fees and expenses, and the diversion of management resources,
regardless of whether the claim is valid, could be significant.
 
 o    Product
defects could cause the Company to incur significant product liability,
warranty, repair and support costs and damage its reputation which would have a
material adverse effect on its business.
 
 Although
the Company rigorously tests its products, defects may be discovered in future
or existing products. These defects could cause the Company to incur significant
warranty, support and repair costs and divert the attention of its research and
development personnel. It could also significantly damage the Company's
reputation and relationship with its distributors and customers which would
adversely affect its business. In addition, such defects could result in
personal injury or financial or other damages to customers who may seek damages
with respect to such losses. A product liability claim against the Company, even
if unsuccessful, would likely be time consuming and costly to
defend.
 
 o    The
markets in which we operate are highly competitive, and many of our competitors
have significantly greater resources than we do.
 
 There is
significant competition among companies that provide emissions monitoring
systems.  Several companies market products that compete directly with
our products.  Other companies offer products that potential customers
may consider to be acceptable alternatives to our products and
services.  We face direct competition from companies with far greater
financial, technological, manufacturing and personnel resources, including
Thermo Fisher Scientific Inc., Tekran Instruments Corporation, Altech
Environment USA, Shaw Group, and Horiba Instruments Inc. in the emissions
monitoring business. Newly developed products could be more effective and cost
efficient than our current or future products.  Many of the current
and potential future competitors have substantially more engineering, sales and
marketing capabilities and broader product lines than we
have.
  12
  o    The
Company’s results may fluctuate due to certain regulatory, marketing and
competitive factors over which we have little or no control.
 
 The
factors listed below, some of which we cannot control, may cause our revenue and
results of operations to fluctuate significantly:
 
 ·
              the
      existence and enforcement of government environmental regulations. If
      these regulations are not maintained or enforced then the market for
      Company’s products could
deteriorate;
 ·
              Retaining
      and keeping qualified employees and management
  personnel;
 ·
              Ability
      to upgrade our products to keep up with the changing market place
      requirements;
 ·
              Ability
      to keep up with our competitors who have much higher resources than
      us;
 ·
              Ability
      to find sub-suppliers and sub-contractors to assemble and install our
      products;
 ·
              General
      economic conditions of the industry and the ability of potential customers
      to spend money on setting up new industries that require our
      products;
 ·
              Ability
      to maintain or raise adequate working capital required for the operations
      and future growth; and
 ·
              Ability
      to retain our CEO and other senior key
  personnel.
 
 o   The
loss of our senior management and failure to attract and retain qualified
personnel in a competitive labor market could limit our ability to execute our
growth strategy, resulting a slower rate of growth.
 
 We depend
on the continued service of our senior management. Due to the nature of our
business, we may have difficulty locating and hiring qualified personnel and
retaining such personnel once hired. The loss of the services of any of our key
personnel, or our failure to attract and retain other qualified and experienced
personnel on acceptable terms, could limit our ability to execute our growth
strategy resulting in a slower rate of growth.
 
 o    General
economic downturns in general would have a material adverse effect on the
Company's business, operating results and financial condition.
 
 The
Company's operations may in the future experience substantial fluctuations from
period to period as a consequence of general economic conditions affecting
consumer spending. Therefore, any economic downturns in general would have a
material adverse effect on the Company's business, operating results and
financial condition.
 
 RISKS
RELATED TO INVESTMENT IN THE COMMON STOCK OF THE COMPANY
 
 o We may
need additional funds in the future. We may be unable to obtain additional funds
or if we obtain financing it may not be on terms favorable to us. You may lose
your entire investment.
 
 Based on
our current plans, we believe our existing cash and cash equivalents along with
cash generated from operations will be sufficient to fund our operating expenses
and capital requirements through June 30, 2009, although there is no assurance
of this result, we may need funds in the future. If our capital resources are
insufficient to meet future capital requirements, we will have to raise
additional funds by selling Company shares. If we are unable to obtain
additional funds on terms favorable to us, we may be required to cease or reduce
our operating activities.
 
 o If we
raise additional funds by selling additional shares of our capital stock, the
ownership interests of our stockholders will be substantially
diluted.
 
 o Our
stock trades on the Over the Counter Bulletin Board quotation
system.
 
 The
Company’s Common Stock currently trades on the Over the Counter Bulletin Board
electronic quotation system under the symbol “CTEI.OB”. The Over the Counter
Bulletin Board is a decentralized market regulated by the Financial Industry
Regulatory Authority in which securities are traded via an electronic quotation
system.  There can be no assurance that a trading market for the
Company's shares will continue to exist in the future, and there can be no
assurance that an active trading market will develop or be sustained. The market
price of the shares of Common Stock is likely to be highly volatile and may be
significantly affected by factors such as actual or anticipated fluctuations in
the Company's operating results, announcements of technological innovations, new
products or new contracts by the Company or its competitors, developments with
respect to proprietary rights, adoption of new government regulations affecting
the environment, general market conditions and other factors. In addition, the
stock market has from time to time experienced significant price and volume
fluctuations that have particularly affected the market price for the common
stocks of technology companies. These types of broad market fluctuations may
adversely affect the market price of the Company's common stock. SeeRisk Factor “Our stock
price may be highly volatile” below.
  13





o  Our
shares of common stock are thinly traded, so stockholders may be unable to sell
at or near ask prices or at all if they need to sell shares to raise money or
otherwise desire to liquidate their shares.




Our
common stock has from time to time been “thinly-traded,” meaning that the number
of persons interested in purchasing our common stock at or near ask prices at
any given time may be relatively small or non-existent. This situation is
attributable to a number of factors, including the fact that we are a small
company that is relatively unknown to stock analysts, stock brokers,
institutional investors and others in the investment community that generate or
influence sales volume, and that even if we came to the attention of such
persons, they tend to be risk-averse and would be reluctant to follow an
unproven company such as ours or purchase or recommend the purchase of our
shares until such time as we become more seasoned and viable. As a consequence,
there may be periods of several days or more when trading activity in our shares
is minimal or non-existent, as compared to a seasoned issuer which has a large
and steady volume of trading activity that will generally support continuous
sales without an adverse effect on share price. We cannot give stockholders any
assurance that a broader or more active public trading market for our common
shares will develop or be sustained, or that current trading levels will be
sustained.




o Our
common stock will be subject to “penny stock” rules which may be detrimental to
investors.




If our
common stock is not listed on a national exchange or market, the trading market
for our common stock may become illiquid. Our common stock trades on the
over-the-counter electronic bulletin board and, therefore, is subject to the
requirements of certain rules promulgated under the Securities Exchange Act of
1934, which require additional disclosure by broker-dealers in connection with
any trades involving a stock defined as a "penny stock".  The
Securities and Exchange Commission has adopted regulations which generally
define "penny stock" to be any equity security that has a market price (as
defined) of less than $5.00 per share or an exercise price of less than $5.00
per share. The securities will become subject to rules that impose additional
sales practice requirements on broker-dealers who sell such securities. For
transactions covered by these rules, the broker-dealer must make a special
suitability determination for the purchaser of such securities and have received
the purchaser's written consent to the transaction prior to the purchase.
Additionally, for any transaction involving a penny stock, unless exempt, the
rules require the delivery, prior to the transaction, of a disclosure schedule
prepared by the Securities and Exchange Commission relating to the penny stock
market. The broker-dealer also must disclose the commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and, if the broker-dealer is the sole market-maker, the broker-dealer
must disclose this fact and the broker-dealer's presumed control over the
market. Finally, among other requirements, monthly statements must be sent
disclosing recent price information for the penny stock held in the account and
information on the limited market in penny stocks. Consequently, the "penny
stock" rules may restrict the ability of purchasers in this offering to sell the
Common Stock offered hereby in the secondary market.




o We do
not anticipate paying any dividends.




No dividends have been paid on the
common stock of the Company. The Company does not intend to pay cash dividends
on its common stock in the foreseeable future, and anticipates that profits, if
any, received from operations will be devoted to the Company's future
operations. Any decision to pay dividends will depend upon the Company's
profitability at the time, cash available and other relevant
factors.




o Our
stock price may be  highly volatile.





The
market price of our common stock, like that of many other technology companies,
has been highly volatile and may continue to be so in the future due to a wide
variety of factors, including:





·
            announcements
      of technological innovations by us, our collaborative partners or our
      present or potential competitors;


·
            our
      quarterly operating results and
performance;


·
            developments
      or disputes concerning patents or other proprietary
  rights;


·
            acquisitions;


·
            litigation
      and government proceedings;


·
            adverse
      legislation;


·
            changes
      in government regulations;


·
            economic
      and other external factors; and


·
            general
      market conditions.


14


In
addition, potential dilutive effects of future sales of shares of common stock
by shareholdersand
by the Company could have an adverse effect on the market price of our
shares.





o Our
principal shareholder has significant influence over our company which could
make it impossible for the public stockholders to influence the affairs of the
Company.





Approximately
_65% of our outstanding voting equity is beneficially held by Arun Govil the
Company’s Chairman, Chief executive officer, President and Treasurer as a result
of Mr. Govil’s common stock and Series A preferred stock
ownership.  Consequently, Mr. Govil will be able to control
substantially all matters requiring approval by the stockholders of the Company,
including the election of all directors and approval of significant corporate
transactions. This makes it impossible for the public stockholders to influence
the affairs of the Company.




ITEM
      2.
              PROPERTIES




The
Company does not own any real estate.





The
Company leases its principal office at Farmingdale, New York, 4000 square feet
of office and warehouse/shop space in a single story commercial structure on a
month to month lease from Ducon Technologies Inc., at a monthly rental of
$2,157.00. The Company’s subsidiary Griffin Filters LLC leases approx. 10,000
sq. ft. of office and warehouse space in Liverpool, New York from a third party
in a five year lease at a monthly rent of $ 4,858.00 expiring on March 30,
2012.  The Company has no plans to acquire any property in the
immediate future. The Company believes that its current facilities are adequate
for its needs through the next six months, and that, should it be needed,
suitable additional space will be available to accommodate expansion of the
Company's operations on commercially reasonable terms, although there can be no
assurance in this regard. There are no written agreements.




ITEM
      3.
            LEGAL
      PROCEEDINGS





None.




ITEM
      4.
            SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY
HOLDERS





No
matters were submitted to a vote of security holders during the year ended
September 30, 2009.




PART II





ITEM 5.
              MARKET
      FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY
SECURITIES





The
Company’s Common Stock currently trades on the Over the Counter Bulletin
Board  electronic quotation system under the symbol
“CTEI.OB”.





As of
January 8, 2010, there were approximately 109 holders of record of the Company's
common stock as determined from the Company’s transfer agent’s
list.  Such list does not include beneficial owners of securities
whose shares are held in the names of various dealers and clearing
agencies.




On August
21, 2007 the Company completed a 1:25 reverse split of our common stock. The
Company is authorized to issue 60,000,000 shares of common stock, $0.001 par
value per share.   On January 8, 2010, there were 39,722,862
shares of common stock issued and outstanding and 1,000,000 shares of Series A
preferred stock issued or outstanding.





The
Company's Common Stock trades on the over-the-counter bulletin board trading
system.  The price ranges presented below represent the highest and
lowest quoted bid prices during the third and fourth calendar quarters for 2007,
2008 and the first, second and third calendar quarters of 2009 reported by the
exchange. The quotes represent prices between dealers and do not reflect
mark-ups, markdowns or commissions and therefore may not necessarily represent
actual transactions.


15




Common
Stock




Year
                                                    
                                                    Period
                                                    
                                                    Stock PriceHigh
                                                    
                                                    
                                                    Low4th
      Quarter
                                                    
                                                    $
                                                    0.53
                                                    
                                                    
                                                    $
                                                    0.243rd
      Quarter
                                                    
                                                    $
                                                    0.64
                                                    
                                                    
                                                    $
                                                    0.452nd
      Quarter
                                                    
                                                    $
                                                    0.75
                                                    
                                                    
                                                    $
                                                    0.172009
                                                    
                                                    1st
      Quarter
                                                    
                                                    $
                                                    0.22
                                                    
                                                    
                                                    $
                                                    0.0084nd
      Quarter
                                                    
                                                    $
                                                    0.02
                                                    
                                                    
                                                    $
                                                    0.0043rd
      Quarter
                                                    
                                                    $
                                                    0.031
                                                    
                                                    
                                                    $
                                                    0.0152th
      Quarter
                                                    
                                                    $
                                                    0.032
                                                    
                                                    
                                                    $
                                                    0.0062008
                                                    
                                                    1st
      Quarter
                                                    
                                                    $
                                                    0.014
                                                    
                                                    
                                                    $
                                                    0.0044nd
      Quarter
                                                    
                                                    $
                                                    0.012
                                                    
                                                    
                                                    $
                                                    0.0043rd
      Quarter
                                                    
                                                    $
                                                    0.0275
                                                    
                                                    
                                                    $
                                                    0.00752rd
      Quarter
                                                    
                                                    $
                                                    0.1125
                                                    
                                                    
                                                    $
                                                    0.022007
                                                    
                                                    1th
      Quarter
                                                    
                                                    $
                                                    0.1875
                                                    
                                                    
                                                    $
                                                    0.075





As
reported by the over-the-counter Pink Sheets, on January 8, 2010 the closing
sales price of the Company’s Common Stock was $0.43 per share.




The
Company has not declared or paid any cash dividends on its common stock nor does
it anticipate paying any in the foreseeable future. Furthermore, the Company
expects to retain any future earnings to finance its operations and expansion.
The payment of cash dividends in the future will be at the discretion of its
Board of Directors and will depend upon its earnings levels, capital
requirements, any restrictive loan covenants and other factors the Board
considers relevant.





The
Company has no equity compensation plans.





ITEM
      6.
            SELECTED
      FINANCIAL DATA





Not
required for Smaller Reporting Companies





ITEM
      7.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS




The
following discussion of our financial condition and plan of operations should be
read in conjunction with the consolidated financial statements and the notes to
those statements included elsewhere in this prospectus. This discussion includes
forward-looking statements that involve risks and uncertainties. As a result of
many factors, such as those set forth under "risk factors" and elsewhere in this
prospectus, our actual results may differ materially from those anticipated in
these forward-looking statements.




OVERVIEW




Cemtrex,
Inc is an environmental & energy efficiency technologies company engaged
in  manufacturing and selling  instruments for emission
monitoring of particulate, opacity, mercury, sulfur dioxide, nitrogen oxides,
etc. and filtration products for the industry.  Company also markets Green
DCV, an innovative energy efficiency solution for high-quality green building
applications, through optimizing HVAC control systems.  Cemtrex
provides technologies and services for abatement of greenhouse gases pursuant to
the Kyoto Protocol and assists customers in developing carbon credits projects
globally.  The Company's Griffin Filters subsidiary sells air
filtration and environmental control products  to power plants,
refineries, chemical plants, cement plants and other industries, including
federal and state governmental agencies.




16





Financial
condition





The
following table sets forth selected historical consolidated financial data from
our consolidated financial statements and should be read in conjunction with our
consolidated financial statements including the related notes and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” which
are included below.





FISCAL
YEAR ENDED SEPTEMBER 30, 2009





Year Ended September 30,2009
                  
                  
                  2008Revenues
                  
                  $
                  6,967,992
                  
                  
                  $
                  6,670,053Operating
      Expenses
                  
                  $
                  2,634,071
                  
                  
                  $
                  2,384,843Net
      Income (Loss)
                  
                  $
                  155,010
                  
                  
                  $
                  118,078Net
      Income (Loss) Per Common Share,
                    Basic
      and Diluted
                  
                  $
                  0.00
                  
                  
                  $
                  0.0Weighted
      Average Number of Shares
                  
                  
                  36,397,337
                  
                  
                  
                  30,308,147





September 30,2009
                  
                  
                  2008Current
      Assets
                  
                  $
                  1,654,119
                  
                  
                  $
                  2,053,508Total
      Assets
                  
                  $
                  1,743,482
                  
                  
                  $
                  2,238,252Total
      Liabilities
                  
                  $
                  1,655,196
                  
                  
                  $
                  3,613,501Total
      Stockholders’ Equity(Deficit)
                  
                  $
                  88,286
                  
                  
                  $
                  ( 1,375,249
                  )




CRITICAL
ACCOUNTING POLICIES AND ESTIMATES




The
following discussion and analysis is based upon our consolidated financial
statements which have been prepared in accordance with accounting principles
generally accepted in the United States of America. The preparation of our
financial statements requires management to make estimates and assumptions that
affect the reported amounts of revenues and expenses, and assets and liabilities
during the periods reported. Estimates are used when accounting for certain
items such as revenues, allowances for returns, early payment discounts,
customer discounts, doubtful accounts, employee compensation programs,
depreciation and amortization periods, taxes, inventory values,  and
valuations of investments, goodwill, other intangible assets and long-lived
assets. We base our estimates on historical experience, where applicable and
other assumptions that we believe are reasonable under the circumstances. Actual
results may differ from our estimates under different assumptions or conditions.
We believe that the following critical accounting policies affect our more
significant judgments and estimates used in preparation of our consolidated
financial statements.




We
maintain allowances for doubtful accounts for estimated losses resulting from
the inability of our customers to make required payments. We base our estimates
on the aging of our accounts receivable balances and our historical write-off
experience, net of recoveries.




We value
our inventories at the lower of cost or market. We write down inventory balances
for estimated obsolescence or unmarketable inventory equal to the difference
between the cost of the inventory and the estimated market value based upon
assumptions about future demand and market conditions.


17




Goodwill
is reviewed for possible impairment at least annually or more frequently upon
the occurrence of an event or when circumstances indicate that the Company’s
carrying amount is greater than the fair value. In accordance with SFAS 142, the
Company examined goodwill for impairment and determined that the Company’s
carrying amount did not exceed the fair value, thus, there was no
impairment.




Generally,
sales are recognized when shipments are made to customers. Rebates, allowances
for damaged goods and other advertising and marketing program rebates are
accrued pursuant to contractual provisions and included in accrued expenses.
Certain amount of our revenues fall under the percentage-of-completion method of
accounting used for long-term contracts. Under this method, sales and gross
profit are recognized as work is performed based on the relationship between
actual costs incurred and total estimated costs at completion. Sales and gross
profit are adjusted prospectively for revisions in estimated total contract
costs and contract values. Estimated losses are recorded when
identified.




RESULTS
OF OPERATIONS





Net Sales:Net sales for 2009
increased by $297,939 or 4.28%, to $6,967,992., from $6,670,053 for 2008. Sales
growth increased during the year of 2009 primarily due to growth in overall
sales as Company received new contracts for various product
lines.  The overall market demand for our existing business increased
during the last year.




Gross Profit: Gross profit
for 2009 increased $270,072 or 9.32%, to $2,900,315, which made up 41.63% of net
sales, from $ 2,630,243 for 2008, which made up of 39.43% of net sales. The
increased gross margin in 2009 was a direct result of the high gross margin on
the ongoing contracts by Cemtrex and Griffin Filters.  The gross
margin for 2009 period includes high margin sales of Cemtrex and Griffin
Filters, whereas in 2008 the higher gross margin was a result of high margin
field services for monitoring systems performed by the Company during that
period.





Operating Expenses:Operating
expenses for 2009 increased $249,228, or 9.47%, to $2,634,071 from $2,384,843 in
2008. Operating expenses as a percentage of sales increased in 2009 to 37.80%
from 35.76% in 2008. The increase in operating expenses was primarily due to
higher expenses as result of larger sales volume in current year as compared to
the previous year.





Net Income/Loss:The Company
had anet income
of $155,010 after provision of income tax of $3,445 for 2009 as compared to a
net income of $118,078 for 2008. The net income in 2009 was a result of several
factors including: (i) increased in sales, (ii) the new Green DCV product line,
(ii) streamlining of griffin Filters operation.  The higher net income
in 2009 period was due to higher gross margin on the products sold by each
company.





Provision for Income Taxes: No
income tax provision due to Net operating loss from prior year
2008.




EFFECTS
OF INFLATION




The
Company’s business and operations have not been materially affected by inflation
during the periods for which financial information is presented.




LIQUIDITY AND CAPITAL RESOURCES




Working
capital was $ 389,443 at September 30, 2009, compared to ($259,993) at September
30, 2008. This included cash and cash equivalents of $356,552 and $60,610 at
September 30, 2009 and 2008, respectively.


18





Trade
receivables decreased  $ 579,416 or 61.07%, at September 30, 2009 to
$948,815 at September 30, 2009 from $1,528,231 at September 30, 2008. The
decrease in accounts receivable is attributable to change in contracts’ terms
and timing of shipments  with
Company’s  customers.





Inventories
decreased $122,465 or 37% to $334,102 at September 30, 2009 from $456,567 at
September 30, 2008.  The decrease inventory was due to less purchases
of inventory and re-valuation of unusable inventory.




Continuing operations provided $374,225
of cash for the fiscal year ended September 30, 2009, compared to using $389,469
of cash for the fiscal year ended September 30, 2008. The increase in cash flows
was primarily related to the decrease in inventory combined with decrease in
accounts receivables.  Investing activities for continuing operations
used $10,157 of cash during 2009, compared to  $151,939 during 2008.
The use of cash by investing activities was primarily attributable to the
purchase of property and equipment.  The financing activities in 2009
generated $68,126 from proceeds of stock sale and loan
proceeds.




We
believe that our cash on hand, cash generated by operations, is sufficient to
meet the capital demands of our current operations during the 2009 fiscal year.
Any major increases in sales, particularly in new products, may require
additional cash and substantial capital investment. Failure to obtain sufficient
capital could materially adversely impact our growth potential.




Outlook




We
anticipate that the outlook for our products and services remains quite strong
and we are positioned well to take advantage of it.




We
believe there is currently a gradually increasing public awareness of the issues
surrounding air quality and that this trend will continue for the next several
years. We also believe there is an increase in public concern regarding the
effects of air quality on society and future generations, as well as an increase
in interest by standards-making bodies in creating specifications and techniques
for detecting, defining and solving air quality problems. As a result, we
believe there will be an increase in interest in our mercury monitors, opacity
monitors, carbon credits and air filtration products of subsidiary Griffin
Filters. We currently also notice increased nationwide concern on energy
efficiency and hence anticipate that there will be greater interest in our Green
DCV products.




This
Outlook section, and other portions of this document, include certain
“forward-looking statements” within the meaning of that term in Section 27A of
the Securities Act of 1933, and Section 21E of the Securities Exchange Act of
1934, including, among others, those statements preceded by, following or
including the words “believe,” “expect,” “intend,” “anticipate” or similar
expressions. These forward-looking statements are based largely on the current
expectations of management and are subject to a number of assumptions, risks and
uncertainties. Our actual results could differ materially from these
forward-looking statements. Important factors to consider in evaluating such
forward-looking statements include those discussed in Item 1A. Risk Factors as
well as:







•
            the shortage of reliable market
      data regarding the emission monitoring & air filtration
      market,





•
            changes in external competitive
      market factors or in our internal budgeting process which might impact
      trends in our results of
operations,





•
            anticipated working capital or
      other cash requirements,





•
            changes in our business strategy
      or an inability to execute our strategy due to unanticipated changes in
      the market,





•
            product obsolescence due to the
      development of new technologies,
and


19





•
            Various competitive factors that
      may prevent us from competing successfully in the
      marketplace.




In light
of these risks and uncertainties, there can be no assurance that the events
contemplated by the forward-looking statements contained in this Form 10-KSB
will in fact occur.




ITEM
      7A.
            QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK





The
response to this item is included in “Item 1A Risk Factors” .




ITEM
      8.
            FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA




The
financial statements required to be included in this report appear as indexed in
the appendix to this report beginning on page F-1.




ITEM
      9.
            CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE





There
have been no changes in and/or disagreements withGruber
& Company, LLC, our independent registered public accountants, on accounting
and financial disclosure matters.





ITEM
      9A.
            CONTROLS
      AND PROCEDURES





Evaluation
of disclosure controls and procedures.





Disclosure  controls  are  procedures  that
are designed  with the  objective of
ensuring  that  information  required to be
disclosed in our reports filed under the Securities  Exchange Act of
1934, as amended (the "Exchange  Act"),  such as this annual
report, is recorded,  processed,  summarized and reported
within the time  periods  specified in the SEC's rules and
forms.  Disclosure controls are also
designed  with  the  objective  of  ensuring  that  such   information  is
accumulated and  communicated  to our
management,  including the CEO and CFO, as appropriate to allow timely
decisions  regarding
required  disclosure.  Internal
controls  are  procedures  which
are  designed  with the  objective of providing
reasonable assurance that (1) our transactions are properly authorized, recorded
and  reported;  and (2)
our  assets  are  safeguarded  against  unauthorized  or
improper use, to permit the preparation of our consolidated financial statements
in conformity with United States generally accepted accounting
principles.





Management’s Report on Internal
Control over Financial Reporting





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting (as such term is defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)). Our internal control over financial
reporting is a process designed under the supervision of our Chief Executive
Officer and Vice President of Finance to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of our financial
statements for external purposes in accordance with accounting principles
generally accepted in the United States of America. Management evaluated the
effectiveness of our internal control over financial reporting using the
criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO) in Internal Control—Integrated
Framework. Management, under the supervision and with the participation
of our Chief Executive Officer and Vice President of Finance, assessed the
effectiveness of our internal control over financial reporting as of September
30, 2009 and concluded that it is effective as of such date





Any
internal control system, no matter how well designed, will have inherent
limitations. Therefore, even those systems determined to be effective can
provide only reasonable assurance with respect to financial statement
preparation and presentation. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.




20


Auditor
Attestation





This  annual  report  does
not include an  attestation  report of
the  company's
registered  public  accounting  firm
regarding  internal  control over financial
reporting.  Management's  report was not subject to
attestation by the company's
registered  public  accounting  firm  pursuant  to
rules of the  Securities  and Exchange Commission that
permit the company to provide only management's report.





Changes in Internal Control Over
Financial Reporting




There
were no changes in our internal controls over financial reporting during the
year ended September 30, 2009 that have materially affected, or are reasonably
likely to materially affect, our internal controls over financial
reporting.




ITEM
9B.             
OTHER INFORMATION




Not
applicable.




PART III





ITEM
      10.
            DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE





The
following persons are our executive officers and directors. Directors are
elected to hold offices until the next annual meeting of Shareholders and until
their successors are elected or appointed and qualified. Officers are appointed
by the board of directors until a successor is elected and qualified or until
resignation, removal or death.





Name
      and Address
                                  
                                  Age
                                  
                                  Positions
      and OfficesArun
      Govil
                                    19
      Engineers Lane
                                    Farmingdale,
      New York 11735
                                  
                                  54
                                  
                                  President,
      Chief Executive Officer,
                                    Treasurer,
      and Chairman of the Board of
                                    DirectorsRenato
      Dela Rama
                                    19
      Engineers Lane
                                    Farmingdale,
      New York 11735
                                  
                                  61
                                  
                                  Vice
      President of Finance and DirectorRavi
      Narayan
                                    19
      Engineers Lane
                                    Farmingdale,
      New York 11735
                                  
                                  50
                                  
                                  Vice
      President of MIP Division and DirectorMetodi
      Filipov
                                    19
      Engineers Lane
                                    Farmingdale,
      New York 11735
                                  
                                  47
                                  
                                  Vice
      President and
Director





Arun
Govil has been our President since December 2004. Mr. Govil is also President
(and owner) of Ducon Technologies Inc., a privately held company engaged in air
pollution control systems business since 1996. Prior to 1996 Mr. Govil, Mr.
Govil worked at various management and technical   positions in
the environmental industry.  Mr. Govil holds a B.E. degree in Chemical
Engineering and a M.B.A. in Finance. He is also a licensed Professional Engineer
in New York State and New Jersey.


21





Renato
Dela Rama has been our Vice President of Finance since December 2004. Mr. Dela
Rama also works as an accountant for Ducon Technologies Inc. since 2004. Prior
to that, he worked in various accounting and financial management positions. Mr.
Dela Rama holds a B.S. degree in accounting.





Ravi
Narayan has been with the Company since 2002 as general manager of MIP Division.
In 2009 he became Vice president of the Company’s MIP Division. From 1993 to
2001 Mr. Narayan worked as a Technical manager at Procal UK Ltd. Mr. Narayan has
a BE in Electronic and Instrument Engineering and an MBA in Business
administration.





Metodi
Filipov has served the Company since 2008 as a Vice President. Mr. Filipov
previously worked as Product Manager at Raritan Inc. from 2004-2008 and prior to
that he worked from 2001-2004 as Vice president of operations at ISS Inc. From
2000-2001 Mr. Filipov worked as Director of Technology at IDS LLC. Mr. Filipov
has a MS degree in Computer science.





There are
no family relationships among our directors and officers.  None of our
directors or officers is a director in any other reporting
companies.  None of our directors or officers has been affiliated with
any company that has filed for bankruptcy within the last five
years.  The Company is not aware of any proceedings to which any of
the Company’s officers or directors, or any associate of any such officer or
director, is a party adverse to the Company or any of the Company’s subsidiaries
or has a material interest adverse to it or any of its
subsidiaries.





Each
director of the Company serves for a term of one year or until the successor is
elected at the Company's annual shareholders' meeting and is qualified, subject
to removal by the Company's shareholders.  Each officer serves, at the
pleasure of the board of directors, for a term of one year and until the
successor is elected at the annual meeting of the board of directors and is
qualified.





Audit
Committee Financial Expert





The
Securities and Exchange Commission has adopted rules implementing Section 407 of
the Sarbanes-Oxley Act of 2002 requiring public companies to disclose
information about "audit committee financial experts." As of the date of this
Annual report, we do not have a standing Audit Committee. The functions of the
Audit Committee are currently assumed by our full Board of Directors.
Additionally, we do not have a member of our Board of Directors that qualifies
as an "audit committee financial expert." For that reason, we do not have an
audit committee financial expert.





SECTION
16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE





To the
best of our knowledge, based solely on a review of the copies of such reports
furnished to us and written representation that no other reports are required,
Section 16(a) filing requirements applicable to our officers, directors, and
greater than ten percent beneficial owners were not filed timely during the most
recent fiscal year.





The
business address for each of our officers and directors is 19 Engineers Lane,
Farmingdale, NY 11735.





ITEM
11.EXECUTIVE
COMPENSATION





BOARD
OF DIRECTORS





All of
our directors hold office until the next annual meeting of stockholders and the
election and qualification of their successors. Our executive officers are
elected annually by the board of directors to hold office until the first
meeting of the board following the next annual meeting of stockholders and until
their successors are chosen and qualified.





DIRECTORS' COMPENSATION





We
reimburse our directors for expenses incurred in connection with attending board
meetings but we do not pay our directors fees or other cash compensation for
services rendered as a director.





EXECUTIVE
COMPENSATION





The
compensation discussion addresses all compensation awarded to, earned by, or
paid to the Cemtrex's named executive officers.  As of January 8,
2010, two of our executive officers are currently earning
compensation.   Set forth below is the aggregate compensation for
services rendered in all capacities to us during our fiscal years ended
September 30, 2007, 2008 and 2009 by our executive officers. Except as indicated
below, none of our executive officers were compensated in excess of
$100,000.


22





SUMMARY
COMPENSATION TABLE





LONG-TERMNAME
      AND PRINCIPAL
                
                
                
                ANNUAL
      COMPENSATION TABLE
                
                
                COMPENSATION
      AWARDSSECURITIES
      UNDERLYINGPOSITION
                
                YEAR
                
                SALARY
                
                
                BONUS
                
                
                OTHER
                
                
                OPTIONS/SARSArun
      Govil
                
                2007
                
                $
                
                
                
                —
                
                
                
                —
                
                
                
                —Chairman,
      Chief Executive
                
                2008
                
                $
                125,000
                
                
                $
                0
                
                
                $
                0
                
                
                
                —Officer
      and Treasurer and President
                
                2009
                
                $
                150,000
                
                
                $
                0
                
                
                $
                0Ravi
      Naravan
                
                2007
                
                $
                
                
                
                
                —
                
                
                
                —
                
                
                
                —Vice
      President, Director
                
                2008
                
                $
                
                
                
                $
                0
                
                
                $
                0
                
                
                
                —2009
                
                $
                110,577
                
                
                $
                0
                
                
                $
                0Metodi
      Filipov
                
                2007
                
                $
                
                
                
                
                —
                
                
                
                —
                
                
                
                —Vice
      President, Director
                
                2008
                
                $
                
                
                
                $
                0
                
                
                $
                0
                
                
                
                —2009
                
                $
                110,577
                
                
                $
                0
                
                
                $
                0Vandana
      Govil(1)
                
                2007
                
                $
                
                
                
                
                —
                
                
                
                —
                
                
                
                —2008
                
                $
                125,000
                
                
                $
                0
                
                
                $
                0
                
                
                
                —2009
                
                $
                125,000
                
                
                $
                0
                
                
                $
                0





(1)
            Ms.
      Govil resigned her positions with the Company as of May 27,
      2009.





OPTIONS/SAR GRANTS IN THE LAST FISCAL YEAR





On April
30, 2007, the Company issued a $1,300,000 Convertible Debenture to Arun Govil
the Company’s Chairman, CEO, President and Treasurer in conjunction with the
purchase of Griffin Filters, Inc. pursuant to the Agreement and Assignment of
Membership Interests between Arun Govil and Cemtrex, Inc. The debenture carried
an 8% annual interest rate with interest payable semiannually in arrears on the
first business day of January and July each year. The debenture principle was
due and payable on April 30, 2011.





The
debenture had the right of conversion into 30,000,000 non-assessable shares of
common stock of the Company at $0.001 (par value) per share. Conversion is not
exercisable prior to December 31, 2007. Commencing December 31, 2007 and
continuing to April 30, 2011, the Debenture Holder had the right of conversion
subject to the terms and conditions of the debenture. In the event the face
amount of the debenture was not fully converted on or before April 30, 2011, the
conversion rights will lapse.





On
September 8, 2009, the Company entered into a letter agreement with Arun Govil,
the Chairman, Chief Executive Officer, Treasurer and President of the Company.
Pursuant to the letter agreement Arun Govil agreed to cancel the convertible
promissory note, held by him, dated April 30, 2007 (the " Note
").  The principal balance of the Note was $1,300,000. Pursuant to the
terms of the Note, the outstanding amount was convertible into 30,000,000 shares
of our common stock. Pursuant to the letter agreement, in return for cancelling
the Note, the Company issued Arun Govil 2,500,000 shares of our common stock and
1,000,000 shares of our Series A Preferred Stock.  Pursuant to the
Certificate of Designation of the Preferred Stock, each issued and outstanding
Preferred Stock shall be entitled to the number of votes equal to the result of:
(i) the number of shares of Common Stock issued and outstanding at the time of
such vote multiplied by 1.01; divided by (ii) the total number of Preferred
Stock issued and outstanding at the time of such vote, at each meeting of
shareholders of the Company with respect to any and all matters presented to the
shareholders of the Company for their action or consideration, including the
election of directors. In consideration of the issuance of the Common Stock and
Preferred Stock described above, Mr. Govil agreed to forfeit 27,500,000 shares
of our common stock issuable as per the original terms of the
Note.


23


AGGREGATED
OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION/SAR
VALUES





None.





ITEM 12.
            SECURITY OWNERSHIP OF CERTAIN
      BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
      MATTERS





The
following table sets forth certain information known to us with respect to the
beneficial ownership of our common stock as of January 8, 2010 by:





o all
persons who are beneficial owners of five percent (5%) or more of our common
stock;





o each of
our directors;





o each of
our executive officers; and





o all
current directors and executive officers as a group.





Except as
otherwise indicated, and subject to applicable community property laws, the
persons named in the table below have sole voting and investment power with
respect to all shares of common stock held by them.





As of
January 8, 2010, 39,722,862 shares of common stock are issued and
outstanding.  Applicable percentage ownership in the following table
is based on 39,722,862 shares of common stock outstanding as of January 8,
2010.(1)





Beneficial
ownership is determined in accordance with the rules of the SEC. In computing
the number of shares beneficially owned by a person and the percentage ownership
of that person, shares of common stock subject to options held by that person
that are currently exercisable or exercisable within 60 days of January 8, 2010
are deemed outstanding. Such shares, however, are not deemed outstanding for the
purpose of computing the percentage ownership of any other person.





Title of Class
                                              
                                              Name and Address of
                                                Owner
                                              
                                              Title
                                              
                                              Amount Owned
                                              
                                              
                                              Percentage of Issued
                                                Common Stock(1)Common
      Stock
                                              
                                              Arun
      Govil
                                                19
      Engineers Lane
                                                Farmingdale,
      New York 11735
                                              
                                              President
      ,Chief
                                                Executive
      Officer and
                                                Chairman
      of the Board
                                              
                                              
                                              27,930,000
                                              (2)(3)
                                              
                                              
                                              65
                                              %Preferred
      Stock
                                              
                                              Arun
      Govil
                                                19
      Engineers Lane
                                                Farmingdale,
      New York 11735
                                              
                                              President
      ,Chief
                                                Executive
      Officer and
                                                Chairman
      of the Board
                                              
                                              
                                              1,000,000
                                              (2)
                                              
                                              
                                              -Common
      Stock
                                              
                                              Renato
      Dela Rama
                                                19
      Engineers Lane
                                                Farmingdale,
      New York 11735
                                              
                                              Vice
      President and
                                                Director
                                              
                                              
                                              400,000
                                              
                                              
                                              
                                              -Common
      Stock
                                              
                                              Ravi
      Narayan
                                                19
      Engineers Lane
                                                Farmingdale,
      New York 11735
                                              
                                              Vice
      President and
                                                Director
                                              
                                              
                                              800,000
                                              
                                              
                                              
                                              2.0
                                              %Common
      Stock
                                              
                                              Metodi
      Filipov
                                                19
      Engineers Lane
                                                Farmingdale,
      New York 11735
                                              
                                              Vice
      President and
                                                Director
                                              
                                              
                                              200,000
                                              
                                              
                                              
                                              -Common
      Stock
                                              
                                              All
      directors and executive officers as a group (4 persons)
                                              
                                              
                                              
                                              
                                              29,330,000
                                              
                                              
                                              
                                              73.84
                                              %




24




(1)
            Except
      as otherwise noted herein, the percentage is determined on the basis of
      39,722,862 shares of our common stock outstanding plus securities deemed
      outstanding pursuant to Rule 13d-3 promulgated under the Securities
      Exchange Act of 1934, as amended (the “Exchange Act”). Under
      Rule 13d-3, a person is deemed to be a beneficial owner of any
      security owned by certain family members and any security of which that
      person has the right to acquire beneficial ownership within 60 days,
      including, without limitation, shares of our common stock subject to
      currently exercisable options.




(2)
            The
      Series A Preferred Stock issued by the Company to Arun Govil the Company’s
      Chairman, CEO, President and Treasurer in conjunction with the settlement
      of the debenture issued as consideration for the purchase of Griffin
      Filters, Inc. Pursuant to the Certificate of Designation of the Preferred
      Stock, each issued and outstanding Preferred Stock shall be entitled to
      the number of votes equal to the result of: (i) the number of shares of
      Common Stock issued and outstanding at the time of such vote multiplied by
      1.01; divided by (ii) the total number of Preferred Stock issued and
      outstanding at the time of such vote, at each meeting of shareholders of
      the Company with respect to any and all matters presented to the
      shareholders of the Company for their action or consideration, including
      the election of directors. The shares of Series A Preferred Stock
      represent 100% of the total Series A Preferred Stock issued and
      outstanding.




(3)
            Includes
      the shares owned by Ducon Technologies Inc. is owned by Arun Govil the
      Chairman, Chief Executive Officer, Treasurer and President of the
      Company.




ITEM 13.
            CERTAIN RELATIONSHIPS AND
      RELATED TRANSACTIONS, AND DIRECTOR
  INDEPENDENCE





On
December 30, 2004, the Company purchased certain assets from Ducon Technologies,
Inc., which related to a business engaged in designing, assembling, selling and
maintaining emission monitors to utilities and industries.  Ducon
Technologies Inc. is owned by Arun Govil, the Chairman, Chief Executive Officer,
Treasurer and President of the Company.  In consideration for the
asset purchase, the Company issued to Ducon Technologies, Inc. 1,950,000 shares
of its common stock.  The shares were issued under Section 4(2) of the
Securities Act of 1933, as amended, and/or Regulation D promulgated by the
Securities and Exchange Commission.





On April
30, 2007, the Company purchased all of the issued and outstanding membership
interests of Griffin Filters LLC, (“Griffin”) a company established since 1971
and engaged in the design, engineering & supplying of industrial air
filtration equipment from its President.  Arun Govil, the Chairman,
Chief Executive Officer, Treasurer and President of the Company, was the owner
of 100% of the issued and outstanding membership interests of
Griffin.  The Company purchased 100% ownership in Griffin for a
purchase price of $ 2,750,000.00. The Company completed the Griffin purchase by
(i) paying cash of $700,000.00, (ii) issuing 20,000,000 shares of common stock
valued at $750,000.00 and (iii) issuing a four year convertible debenture in the
amount of $1,300,000.00, paying interest of 8.0% per year and convertible into
30,000,000 shares of common stock. Griffin had sales and net income of
$3,297,409 and $145, 981 respectively for fiscal year ended September 30, 2006.
Griffin is now a wholly-owned subsidiary of the Company.





On
September 8, 2009, the Company entered into a letter agreement with Arun Govil,
the Chairman, Chief Executive Officer, Treasurer and President of the Company.
Pursuant to the letter agreement Arun Govil agreed to cancel the convertible
promissory note, held by him, dated April 30, 2007 (the " Note
").  The principal balance of the Note was $1,300,000. Pursuant to the
terms of the Note, the outstanding amount was convertible into 30,000,000 shares
of our common stock. Pursuant to the letter agreement, in return for cancelling
the Note, the Company issued Arun Govil 2,500,000 shares of our common stock and
1,000,000 shares of our Series A Preferred Stock.  Pursuant to the
Certificate of Designation of the Preferred Stock, each issued and outstanding
Preferred Stock shall be entitled to the number of votes equal to the result of:
(i) the number of shares of Common Stock issued and outstanding at the time of
such vote multiplied by 1.01; divided by (ii) the total number of Preferred
Stock issued and outstanding at the time of such vote, at each meeting of
shareholders of the Company with respect to any and all matters presented to the
shareholders of the Company for their action or consideration, including the
election of directors. In consideration of the issuance of the Common Stock and
Preferred Stock described above, Mr. Govil agreed to forfeit 27,500,000 shares
of our common stock issuable as per the original terms of the Note.




25




Ducon
Technologies, Inc. is owned by by Arun Govil the Chairman, Chief Executive
Officer, Treasurer and President of the Company.




Renato
Dela Rama the Vice President of Finance of the Company is also an accountant
with Ducon Technologies Inc.




Mrs.
Vandana Govil, who was earlier a director and the Secretary of the Company, is
the wife of Arun Govil the Chairman, Chief Executive Officer, Treasurer and
President of the Company.  Ms. Govil resigned her positions with the
Company on May 27, 2009.




ITEM 14.
            PRINCIPAL ACCOUNTING FEES AND
      SERVICES





The
Company’s Board of Directors does not have an Audit Committee.





The
following table sets forth the aggregate fees billed to us for the years ended
September 30, 2009 and September 30, 2008 by Gruber & Company, LLP, our
independent auditors for the fiscal years ended September 30, 2009 and
2008:





2008
                    
                    
                    2009Audit
      Fees
                    
                    $
                    29,500
                    
                    
                    $
                    33,000Audit-Related
      Fees
                    
                    
                    
                    
                    
                    $Tax
      Fees
                    
                    
                    
                    
                    
                    $Other
      Fees
                    
                    
                    
                    
                    
                    $Totals
                    
                    $
                    29,500
                    
                    
                    $
                    33,000





Audit
fees represent amounts billed for professional services rendered for the audit
of our annual financial statements.  Audit-Related Fees include
amounts billed for professional services rendered in connection with our SEC
filings and discussions with the SEC that occurred during fiscal 2009 for us to
become a fully reporting public company.  Our Board of Directors is of
the opinion that the Audit-Related Fees charged by Gruber & Company, LLC,
LLP were consistent with Gruber & Company, LLC maintaining its independence
from us.





The Board
of Directors has considered whether provision of the non-audit services
described above is compatible with maintaining the independent accountant’s
independence and has determined that such services did not adversely affect
Gruber & Company, LLC independence.





PART IV





ITEM
15.EXHIBITS AND
FINANCIAL STATEMENT SCHEDULES




(a)
            Financial
      Statements




Report of Independent Registered
      Public Accounting Firm – September 2008Audited Consolidated Balance Sheets as of
      September 30, 2008 and September 30, 2009
                                          F-1Audited Consolidated Statements of Operations for
      the Year Ended September, 2008 and 2007
                                          F-2Audited Consolidated Statements of Stockholders’
      Equity (Deficit) for the Years Ended September 30, 2009, and
      2007
                                          F-3Audited Consolidated Statements of Cash Flows for
      the Year Ended September 30, 2009 and 2008
                                          F-4Notes to Audited Consolidated Financial
      Statements


26




(b)
            Exhibit
      Index




Exhibit
      Number
                  
                  Description
      of Exhibit3.1
                  
                  Certificate
      of Incorporation of the Company*3.2
                  
                  By
      Laws of the Company*3.3
                  
                  Certificate
      of Amendment of Certificate of Incorporation dated September 29,
      2006*3.4
                  
                  Certificate
      of Amendment of Certificate of Incorporation dated March 30,
      2007*3.5
                  
                  Certificate
      of Amendment of Certificate of Incorporation dated May 16,
      2007*3.6
                  
                  Certificate
      of Amendment of Certificate of Incorporation dated August 21,
      2007*3.7
                  
                  Certificate
      of Designation of the Series A Preferred Stock dated September 8,
      2009**10.1
                  
                  Cemtrex
      Lease Agreement-Ducon Technologies, Inc.*10.2
                  
                  Lease
      Agreement between Daniel L. Canino and Griffin Filters,
    LLC*10.3
                  
                  Asset
      Purchase Agreement between Ducon Technologies, Inc. and Cemtrex
      Inc.*10.4
                  
                  Agreement
      and Assignment of Membership Interests between Arun Govil and Cemtrex,
      Inc.*10.5
                  
                  8.0%
      Convertible Subordinated Debenture*10.6
                  
                  Letter
      Agreement by and between the Company and Arun Govil, the Chairman, Chief
      Executive Officer, Treasurer and President of the Company dated September
      8, 2009**21.1
                  
                  Subsidiaries*23.1
                  
                  Consent
      of Independent Registered Public Accounting Firm.***31.1
                  
                  Certification
      by CEO pursuant to Sections 302 of the Sarbanes-Oxley Act of 2002
      ***31.2
                  
                  Certification
      by Vice President of Finance pursuant to Sections 302 of the
      Sarbanes-Oxley Act of 2002***32.1
                  
                  Certification
      of CEO pursuant to Section 906 of the Sarbanes-Oxley Act of
      2002***32.2
                  
                  Certification
      Vice President of Finance pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002***


______





*
Incorporated by reference from Form 10-12G filed on May 22, 2008


**
Incorporated by reference from Form 8-K filed on September 10, 2009


***
Filed Herewith


27





SIGNATURES





Pursuant
to the requirements of the Securities and Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.





CEMTREX,
      INC.(Registrant)Dated:
      January 13, 2009
                        
                        By
                        /s/
      Arun GovilArun
      Govil, Chairman of the Board, Chief Executive Officer
                          and
      President (Principal Executive Officer)Dated:
      January 13, 2009
                        
                        By
                        /s/
      Renato Dela RamaRenato
      Dela Rama, Vice President of Finance  (PrincipalFinancial
      Officer)Dated:
      January 13, 2009
                        
                        By
                        /s/
      Ravi NarayanRavi
      Narayan, Vice President of MIP Division and DirectorDated:
      January 13, 2009
                        
                        By
                        /s/
      Metodi FilipovMetodi
      Filipov, Secretary and
Director




28


Cemtrex,
Inc. and Subsidiary


Consolidated
Balance Sheets





September
      30,2009
                                  
                                  
                                  2008AssetsCurrent
      AssetsCash
      & Equivalents
                                  
                                  $
                                  356,552
                                  
                                  
                                  $
                                  60,610Accounts
      Receivable
                                  
                                  
                                  948,815
                                  
                                  
                                  
                                  1,528,231Inventory
                                  
                                  
                                  334,102
                                  
                                  
                                  
                                  456,567Prepaid
      Expenses & Other Assets
                                  
                                  
                                  14,650
                                  
                                  
                                  
                                  8,100Total
      Current Assets
                                  
                                  
                                  1,654,119
                                  
                                  
                                  
                                  2,053,508Property
      & Equipment, Net
                                  
                                  
                                  85,138
                                  
                                  
                                  
                                  180,519Other
                                  
                                  
                                  4,225
                                  
                                  
                                  
                                  4,225Total
      Assets
                                  
                                  $
                                  1,743,482
                                  
                                  
                                  $
                                  2,238,252Liabilities & Stockholders' Equity
      (Deficit)Current
      LiabilitiesAccounts
      Payable
                                  
                                  $
                                  876,799
                                  
                                  
                                  $
                                  940,071Accrued
      Expenses
                                  
                                  
                                  387,877
                                  
                                  
                                  
                                  906,259Notes
      Payable-Shareholder
                                  
                                  
                                  -
                                  
                                  
                                  
                                  467,171Total
      Current Liabilities
                                  
                                  
                                  1,264,676
                                  
                                  
                                  
                                  2,313,501Non-Current
      LiabilitiesNotes
      Payable-Shareholder
                                  
                                  
                                  390,520
                                  
                                  
                                  
                                  -Convertible
      Debenture
                                  
                                  
                                  -
                                  
                                  
                                  
                                  1,300,000Total
      Non-Current Liabilities
                                  
                                  
                                  390,520
                                  
                                  
                                  
                                  1,300,000Total
      Liabilities
                                  
                                  $
                                  1,655,196
                                  
                                  
                                  $
                                  3,613,501Commitments
      & Contingencies
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Stockholders'
      Equity (Deficit)Preferred
      Stock Series A, $0.001 par value, 10,000,000 shares authorized, 1,000,000
      shares issued and outstanding, respectively
                                  
                                  $
                                  1,000
                                  
                                  
                                  $
                                  -Common
      Stock, $0.001 par value, 60,000,000 shares authorized, authorized;
      39,722,862 and 34,327,862 shares issued and outstanding,
      respectively
                                  
                                  
                                  39,723
                                  
                                  
                                  
                                  34,328Additional
      Paid-in Capital
                                  
                                  
                                  42,606
                                  
                                  
                                  
                                  (1,259,524
                                  )Retained
      Earnings (Accumulated Deficit)
                                  
                                  
                                  4,957
                                  
                                  
                                  
                                  (150,053
                                  )Total
      Stockholders' Equity (Deficit)
                                  
                                  
                                  88,286
                                  
                                  
                                  
                                  (1,375,249
                                  )Total
      Liabilities & Stockholders' Equity (Deficit)
                                  
                                  $
                                  1,743,482
                                  
                                  
                                  $
                                  2,238,252





The
accompanying notes are an integral part of these financial
statements


F-1


Cemtrex,
Inc. and Subsidiary


Consolidated
Statements of Operations





For
      the Twelve Months EndedSeptember
      30,2009
                      
                      
                      2008Revenues
                      
                      $
                      6,967,992
                      
                      
                      $
                      6,670,053Cost
      of Goods Sold
                      
                      
                      4,067,677
                      
                      
                      
                      4,039,810Gross
      Profit
                      
                      
                      2,900,315
                      
                      
                      
                      2,630,243Operating
      ExpensesResearch
      and Development
                      
                      
                      5,535
                      
                      
                      
                      -General
      and Administrative
                      
                      
                      2,628,536
                      
                      
                      
                      2,384,843Total
      Operating Expenses
                      
                      
                      2,634,071
                      
                      
                      
                      2,384,843Operating
      Income (Loss)
                      
                      
                      266,244
                      
                      
                      
                      245,400Other
      Income (Expense)Other
      Income
                      
                      
                      -
                      
                      
                      
                      36Interest
      Expense
                      
                      
                      (107,789
                      )
                      
                      
                      (127,358
                      )Total
      Other  Income (Expense)
                      
                      
                      (107,789
                      )
                      
                      
                      (127,322
                      )Net
      Income (Loss) Before Income Taxes
                      
                      
                      158,455
                      
                      
                      
                      118,078Provision
      for Income Taxes
                      
                      
                      (3,445
                      )
                      
                      
                      -Net
      Income (Loss)
                      
                      $
                      155,010
                      
                      
                      $
                      118,078Income
      (Loss) Per Share-Basic
                      
                      $
                      0.00
                      
                      
                      $
                      0.00Income
      (Loss) Per Share-Diluted
                      
                      $
                      0.00
                      
                      
                      $
                      0.00Weighted
      Average Number of Shares-Basic
                      
                      
                      36,397,337
                      
                      
                      
                      30,308,147Weighted
      Average Number of Shares-Diluted
                      
                      
                      37,397,337
                      
                      
                      
                      30,308,148





The
accompanying notes are an integral part of these financial
statements


F-2


Cemtrex,
Inc. and Subsidiary


Consolidated
Statements of Cash Flows





For
      the Twelve Months EndedSeptember
      30,2009
                                          
                                          
                                          2008Cash Flows from Operating
      ActivitiesNet
      Income (Loss)
                                          
                                          $
                                          155,010
                                          
                                          
                                          $
                                          118,078Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
      & Amortization
                                          
                                          
                                          33,296
                                          
                                          
                                          
                                          33,143Changes
      in operating assets and liabilities:Accounts
      Receivable
                                          
                                          
                                          579,416
                                          
                                          
                                          
                                          (747,757
                                          )Inventory
                                          
                                          
                                          122,465
                                          
                                          
                                          
                                          (204,124
                                          )Prepaid
      Expenses & Other Assets
                                          
                                          
                                          (6,550
                                          )
                                          
                                          
                                          (3,875
                                          )Other
      Assets
                                          
                                          
                                          -
                                          
                                          
                                          
                                          17,799Accounts
      Payable
                                          
                                          
                                          8,970
                                          
                                          
                                          
                                          25,164Accrued
      Expenses
                                          
                                          
                                          (518,382
                                          )
                                          
                                          
                                          457,619Customer
      Deposits
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (85,516
                                          )Net
      Cash Used in Operating Activities
                                          
                                          
                                          374,225
                                          
                                          
                                          
                                          (389,469
                                          )Cash Flows from Investing
      ActivitiesPurchase
      of Property and Equipment
                                          
                                          
                                          (10,157
                                          )
                                          
                                          
                                          (151,939
                                          )Net
      Cash Used in Investing Activities
                                          
                                          
                                          (10,157
                                          )
                                          
                                          
                                          (151,939
                                          )Cash Flows from Financing
      ActivitiesNet
      Loans from Shareholders
                                          
                                          
                                          (76,651
                                          )
                                          
                                          
                                          458,188Common
      Stock Issued for Cash
                                          
                                          
                                          8,525
                                          
                                          
                                          
                                          -Net
      Cash Provided by Financing Activities
                                          
                                          
                                          (68,126
                                          )
                                          
                                          
                                          458,188Net
      Increase (Decrease) in Cash
                                          
                                          
                                          295,942
                                          
                                          
                                          
                                          (83,220
                                          )Cash
      Beginning of Period
                                          
                                          
                                          60,610
                                          
                                          
                                          
                                          143,830Cash
      End of Period
                                          
                                          $
                                          356,552
                                          
                                          
                                          $
                                          60,610Supplemental
      Disclosure of Cash Flow Information:Cash
      Paid during the period for interest
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          -Cash
      Paid during the period for income taxes
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -Supplemental
      Disclosure of Non-Cash Items:Shares
      Issued for Conversion of Convertible Debt
                                          
                                          $
                                          1,300,000
                                          
                                          
                                          $
                                          -Equipment
      Sold in Exchange for Reduction in Accounts Payable
                                          
                                          
                                          72,242
                                          
                                          
                                          
                                          -





The
accompanying notes are an integral part of these financial
statements


F-3


Cemtrex,
Inc. and Subsidiary


Consolidated
Statements of Stockholders' Equity (Deficit)





Preferred Stock-Series A
                        
                        
                        Common StockNumber of
                          Shares
                        
                        
                        Par Value
                          ($0.001)Amount
                        
                        
                        Number of
                          Shares
                        
                        
                        Par Value
                          ($0.001)Amount
                        
                        
                        AdditionalPaid-In-
                          Capital
                        
                        
                        Retained
                          Earnings
                          (Accumulated
                          Deficit)
                        
                        
                        Total
                          Stockholders'
                          Equity (Deficit)Balance
      at September 30, 2007
                        
                        
                        -
                        
                        
                        $
                        -
                        
                        
                        
                        34,327,862
                        
                        
                        $
                        34,328
                        
                        
                        $
                        (1,259,524
                        )
                        
                        $
                        (268,131
                        )
                        
                        $
                        (1,493,327
                        )Net
      Income
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        118,078
                        
                        
                        
                        118,078Balance
      at September 30, 2008
                        
                        
                        -
                        
                        
                        $
                        -
                        
                        
                        
                        34,327,862
                        
                        
                        $
                        34,328
                        
                        
                        $
                        (1,259,524
                        )
                        
                        $
                        (150,053
                        )
                        
                        $
                        (1,375,249
                        )Shares
      Issued for Conversion of Convertible Debt
                        
                        
                        1,000,000
                        
                        
                        
                        1,000
                        
                        
                        
                        2,500,000
                        
                        
                        
                        2,500
                        
                        
                        
                        1,296,500
                        
                        
                        
                        -
                        
                        
                        
                        1,300,000Shares
      Issued for Cash
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        2,895,000
                        
                        
                        
                        2,895
                        
                        
                        
                        5,630
                        
                        
                        
                        -
                        
                        
                        
                        8,525Net
      Income
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        155,010
                        
                        
                        
                        155,010Balance
      at September 30, 2009
                        
                        
                        1,000,000
                        
                        
                        $
                        1,000
                        
                        
                        
                        39,722,862
                        
                        
                        $
                        39,723
                        
                        
                        $
                        42,606
                        
                        
                        $
                        4,957
                        
                        
                        $
                        88,286





The
accompanying notes are an integral part of these financial
statements


F-4




Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
  Note
1 – Organization, Business & Operations
  Cemtrex,
Inc. and its wholly-owned subsidiary Griffin Filters, LLC (collectively the
“Company”), is engaged in manufacturing and selling the most advanced
instruments for emission monitoring of particulate, opacity, mercury, sulfur
dioxide, nitrogen oxides, etc. Cemtrex also provides turnkey services for carbon
creation projects from abatement of greenhouse gases pursuant to Kyoto protocol
and assists project owners in selling of carbon credits globally. Company's
products are sold to power plants, refineries, chemical plants, cement plants
& other industries including federal and state governmental agencies.
Through its wholly-owned subsidiary, Griffin Filters, the Company designs,
manufactures and sells air filtration equipment and systems to control
particulate emissions in a variety of industries.
  Cemtrex,
Inc. was incorporated as Diversified American Holding, Inc. on April 27, 1998.
On December 16, 2004, the Company changed its name to Cemtrex, Inc. On April 30,
2007, Cemtrex, Inc. acquired Griffin Filters, LLC (see Note 5 – Business
Combination and Related Party Transactions).
  Note
2 - Summary of Significant Accounting Policies
  Principles
of Consolidation
  The
accompanying consolidated financial statements include the accounts of Cemtrex,
Inc. and its wholly subsidiary Griffin Filters, LLC (collectively the
“Company”). All significant inter-company accounts and transactions have been
eliminated in consolidation.
  The
acquisition of Griffin Filters, LLC by Cemtrex, Inc. was treated as a business
combination due to the fact that the acquired entity and purchased entity were
owned by the same individual. Therefore, these consolidated financial statements
have been retrospectively adjusted for all periods presented.
  Accounting
Method
  The
Company’s financial statements are prepared using the accrual method of
accounting. The Company has elected a September 30 year-end.
  Cash
and cash equivalents
  The
Company considers all liquid investments with a maturity of three months or less
from the date of purchase that are readily convertible into cash to be cash
equivalents.
  Concentrations
of Credit Risk - Cash
  The
Company maintains its cash with various financial institutions, which may exceed
federally insured limits throughout the period.
  Inventories
  Inventories
are comprised of replacement parts, system components and finished systems,
which are stated at lower of cost or market. Cost is determined on a first-in,
first-out (FIFO) basis.
  Property
and Equipment
  Property
and equipment are stated at cost and are depreciated using the straight-line
method over their estimated useful lives, generally five to seven years.
Leasehold improvements are amortized over the shorter of the useful life or the
remaining lease term. Upon retirement or other disposition of these assets, the
cost and related accumulated depreciation are removed from the accounts and the
resulting gains or losses are reflected in operations. Expenditures for
maintenance and repairs are charged to operations as incurred. Renewals and
betterments are capitalized.
  Impairment
of long-lived asset
  The
Company reviews its long-lived assets and identifiable intangibles for
impairment whenever events or changes in circumstances indicate that the
carrying value of an asset may not be recoverable. When such factors and
circumstances exist, management compares the projected undiscounted future cash
flows associated with the future use and disposal of the related asset or group
of assets to their respective carrying values. Impairment, if any, is measured
as the excess of the carrying value over the fair value, based on market value
when available, or discounted expected cash flows, of those assets and is
recorded in the period in which the determination is made. During fiscal years
ended September 30, 2009 and 2008, the Company recorded $0 impairment loss on
long-lived assets.
  F-5
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 Basic
and Diluted Net Income per Share
  Basic
earnings per share is calculated using the weighted-average number of common
shares outstanding during the period without consideration of the dilutive
effect of stock warrants and convertible notes. Diluted earnings per share is
calculated using the weighted-average number of common shares outstanding during
the period after consideration of the dilutive effect of stock warrants and
convertible notes.
  Revenue
recognition
  Sales of
products and related costs of products sold are recognized when (i) persuasive
evidence of an arrangement exists, (ii) delivery has occurred, (iii) the price
is fixed or determinable and (iv) collectability is reasonably assured. These
terms are typically met upon shipment of finished goods to the
customer.
  Allowance
for doubtful accounts
  We
provide an allowance for estimated uncollectible accounts receivable balances
based on historical experience and the aging of the related accounts receivable.
As of September 30, 2009 and 2008, the Company has reserved $200,000 for
doubtful accounts.
  Advertising
  The
Company expenses advertising costs as incurred. The Company incurred $47,352 and
$0 in advertising costs for the years ended September 30, 2009 and 2008,
respectively.
  Income
Taxes
  The
Company accounts for income taxes under the provisions of FASB ASC 740, “Income
Taxes”, formerly referenced as SFAS No. 109, “Accounting for Income Taxes”.
Under the provisions of FASB ASC 740, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
their financial statement carrying values and their respective tax bases.
Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date.
  Significant
judgment is required in determining any valuation allowance recorded against
deferred tax assets. In assessing the need for a valuation allowance, the
Company considers all available evidence including past operating results,
estimates of future taxable income, and the feasibility of tax planning
strategies. In the event that the Company changes its determination as to the
amount of deferred tax assets that can be realized, the Company will adjust its
valuation allowance with a corresponding impact to the provision for income
taxes in the period in which such determination is made.
 F-6
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
    September
      30,2009
                          
                          
                          2008Current
      TaxesU.S.
      Federal
                          
                          $
                          53,875
                          
                          
                          $
                          -U.S.
      State and Local
                          
                          
                          11,092
                          
                          
                          
                          -Current
      Taxes
                          
                          
                          64,967
                          
                          
                          
                          -Deferred
      Tax Asset
                          
                          
                          (61,522
                          )
                          
                          
                          61,522Deferred
      Tax Valuation Allowance
                          
                          
                          -
                          
                          
                          
                          (61,522
                          )Provision
      for Income Taxes
                          
                          $
                          3,445
                          
                          
                          $
                          -
  September
      30,2009
                
                
                2008Statutory
      Federal Tax (Benefit) Rate
                
                
                34.0
                %
                
                
                34.0
                %Statutory
      State Tax (Benefit) Rate
                
                
                7.0
                %
                
                
                7.0
                %Effective
      Tax (Benefit) Rate
                
                
                41.0
                %
                
                
                41.0
                %Valuation
      Allowance
                
                
                -38.8
                %
                
                
                -41.0
                %Effective
      Income Tax
                
                
                2.2
                %
                
                
                0.0
                %
   Guarantee
Expense
  In
accordance with FASB Interpretation No. 45 ("Fin 45"), the Company recognizes,
at the inception of a guarantee, the cost of the fair value of the obligation
undertaken in issuing the guarantee.
  Research
and development costs
  Expenditures
for research & development are expenses as incurred. Such costs are required
to be expensed until the point that technological feasibility is established.
The Company incurred $5,535 and $0 research and development costs for the years
ended September 30, 2009 and 2008, respectively which were
expensed.
  Fair
Value of Financial Instruments
  The
reported amounts of the Company's financial instruments, including accounts
payable and accrued liabilities, approximate their fair value due to their short
maturities. The carrying amounts of debt approximate fair value since the debt
agreements provide for interest rates that approximate market.
  Stock-based
compensation
  The
Company records compensation expense associated with stock options and other
forms of employee and non-employee equity compensation in accordance with FASB
ASC 718, “Compensation – Stock Compensation”, formerly referenced as SFAS 123R,
“Share-Based Payment”. The Company estimates the fair value of stock options
granted using the Black-Scholes-Merton option-pricing formula and a single
option approach. This fair value is then amortized on a straight-line basis over
the requisite service periods of the awards, which is generally the vesting
period.
  During
fiscal years ended September 30, 2009 and 2008, the Company incurred $0 in
stock-based compensation expense.
  Reclassifications
  Certain
items in the prior year financial statements have been reclassified for
comparative purposes to conform to the presentation in the current period’s
presentation. These reclassifications have no effect on the previously reported
income (loss).
 F-7
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
  Recently
Issued Accounting Pronouncements
  The
adoption of these accounting standards had the following impact on the Company’s
statements of income and financial condition:
  ·
              FASB
      ASC Topic 855, “Subsequent Events”. In May 2009, the FASB issued FASB ASC
      Topic 855, which establishes general standards of accounting and
      disclosure of events that occur after the balance sheet date but before
      financial statements are issued or are available to be issued. In
      particular, this Statement sets forth : (i) the period after the balance
      sheet date during which management of a reporting entity should evaluate
      events or transactions that may occur for potential recognition or
      disclosure in the financial statements, (ii) the circumstances under which
      an entity should recognize events or transactions occurring after the
      balance sheet date in its financial statements, (iii) the disclosures that
      an entity should make about events or transactions that occurred after the
      balance sheet date. This FASB ASC Topic should be applied to the
      accounting and disclosure of subsequent events. This FASB ASC Topic does
      not apply to subsequent events or transactions that are within the scope
      of other applicable accounting standards that provide different guidance
      on the accounting treatment for subsequent events or transactions. This
      FASB ASC Topic was effective for interim and annual periods ending after
      June 15, 2009, which was June 30, 2009 for the Corporation. The adoption
      of this Topic did not have a material impact on the Company’s financial
      statements and disclosures.
  ·
              FASB
      ASC Topic 105, “The FASB Accounting Standard Codification and the
      Hierarchy of Generally Accepted Accounting Principles”. In June 2009, the
      FASB issued FASB ASC Topic 105, which became the source of authoritative
      GAAP recognized by the FASB to be applied by nongovernmental entities.
      Rules and interpretive releases of the SEC under authority of federal
      securities laws are also sources of authoritative GAAP for SEC
      registrants. On the effective date of this FASB ASC Topic, the
      Codification will supersede all then-existing non-SEC accounting and
      reporting standards. All other non-SEC accounting literature not included
      in the Codification will become non-authoritative. This FASB ASC Topic
      identify the sources of accounting principles and the framework for
      selecting the principles used in preparing the financial statements of
      nongovernmental entities that are presented in conformity with GAAP. Also,
      arranged these sources of GAAP in a hierarchy for users to apply
      accordingly. In other words, the GAAP hierarchy will be modified to
      include only two levels of GAAP: authoritative and non-authoritative. This
      FASB ASC Topic is effective for financial statements issued for interim
      and annual periods ending after September 15, 2009. The adoption of this
      topic did not have a material impact on the Company’s disclosure of the
      financial statements
  ·
              FASB
      ASC Topic 320, “Recognition and Presentation of Other-Than-Temporary
      Impairments”. In April 2009, the FASB issued FASB ASC Topic 320 amends the
      other-than-temporary impairment guidance in GAAP for debt securities to
      make the guidance more operational and to improve the presentation and
      disclosure of other-than-temporary impairments on debt and equity
      securities in the financial statements. This FASB ASC Topic does not amend
      existing recognition and measurement guidance related to
      other-than-temporary impairments of equity securities. The FASB ASC Topic
      shall be effective for interim and annual reporting periods ending after
      June 15, 2009, with early adoption permitted for periods ending after
      March 15, 2009. Earlier adoption for periods ending before March 15, 2009,
      is not permitted. This FASB ASC Topic does not require disclosures for
      earlier periods presented for comparative purposes at initial adoption. In
      periods after initial adoption, this FASB ASC Topic requires comparative
      disclosures only for periods ending after initial adoption. The adoption
      of this Topic did not have a material impact on the Company’s financial
      statements and disclosures.
  The
Company is evaluating the impact that the following recently issued accounting
pronouncements may have on its financial statements and
disclosures.
  ·
              FASB
      ASC Topic 860, “Accounting for Transfer of Financial Asset”., In June
      2009, the FASB issued additional guidance under FASB ASC Topic 860,
      “Accounting for Transfer and Servicing of Financial Assets and
      Extinguishment of Liabilities", which improves the relevance,
      representational faithfulness, and comparability of the information that a
      reporting entity provides in its financial statements about a transfer of
      financial assets; the effects of a transfer on its financial position,
      financial performance, and cash flows; and a transferor’s continuing
      involvement, if any, in transferred financial assets. The Board undertook
      this project to address (i) practices that have developed since the
      issuance of FASB ASC Topic 860, that are not consistent with the original
      intent and key requirements of that statement and (ii) concerns of
      financial statement users that many of the financial assets (and related
      obligations) that have been derecognized should continue to be reported in
      the financial statements of transferors. This additional guidance requires
      that a transferor recognize and initially measure at fair value all assets
      obtained (including a transferor’s beneficial interest) and liabilities
      incurred as a result of a transfer of financial assets accounted for as a
      sale. Enhanced disclosures are required to provide financial statement
      users with greater transparency about transfers of financial assets and a
      transferor’s continuing involvement with transferred financial assets.
      This additional guidance must be applied as of the beginning of each
      reporting entity’s first annual reporting period that begins after
      November 15, 2009, for interim periods within that first annual reporting
      period and for interim and annual reporting periods thereafter. Earlier
      application is prohibited. This additional guidance must be applied to
      transfers occurring on or after the effective
  date.
 F-8
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
  ·
              FASB
      ASC Topic 810, “Variables Interest Entities”. In June 2009, the FASB
      issued FASB ASC Topic 810, which requires an enterprise to perform an
      analysis to determine whether the enterprise’s variable interest or
      interests give it a controlling financial interest in a variable interest
      entity. This analysis identifies the primary beneficiary of a variable
      interest entity as the enterprise that has both of the following
      characteristics: (i)The power to direct the activities of a variable
      interest entity that most significantly impact the entity’s economic
      performance and (ii)The obligation to absorb losses of the entity that
      could potentially be significant to the variable interest entity or the
      right to receive benefits from the entity that could potentially be
      significant to the variable interest entity. Additionally, an enterprise
      is required to assess whether it has an implicit financial responsibility
      to ensure that a variable interest entity operates as designed when
      determining whether it has the power to direct the activities of the
      variable interest entity that most significantly impact the entity’s
      economic performance. This FASB Topic requires ongoing reassessments of
      whether an enterprise is the primary beneficiary of a variable interest
      entity and eliminate the quantitative approach previously required for
      determining the primary beneficiary of a variable interest entity, which
      was based on determining which enterprise absorbs the majority of the
      entity’s expected losses, receives a majority of the entity’s expected
      residual returns, or both. This FASB ASC Topic shall be effective as of
      the beginning of each reporting entity’s first annual reporting period
      that begins after November 15, 2009, for interim periods within that first
      annual reporting period, and for interim and annual reporting periods
      thereafter. Earlier application is
prohibited.
  ·
              FASB
      ASC Topic 820, “Fair Value measurement and Disclosures”, an Accounting
      Standard Update. In September 2009, the FASB issued this Update to
      amendments to Subtopic 82010, “Fair Value Measurements and Disclosures”.
      Overall, for the fair value measurement of investments in certain entities
      that calculates net asset value per share (or its equivalent). The
      amendments in this Update permit, as a practical expedient, a reporting
      entity to measure the fair value of an investment that is within the scope
      of the amendments in this Update on the basis of the net asset value per
      share of the investment (or its equivalent) if the net asset value of the
      investment (or its equivalent) is calculated in a manner consistent with
      the measurement principles of Topic 946 as of the reporting entity’s
      measurement date, including measurement of all or substantially all of the
      underlying investments of the investee in accordance with Topic 820. The
      amendments in this Update also require disclosures by major category of
      investment about the attributes of investments within the scope of the
      amendments in this Update, such as the nature of any restrictions on the
      investor’s ability to redeem its investments at the measurement date, any
      unfunded commitments (for example, a contractual commitment by the
      investor to invest a specified amount of additional capital at a future
      date to fund investments that will be made by the investee), and the
      investment strategies of the investees. The major category of investment
      is required to be determined on the basis of the nature and risks of the
      investment in a manner consistent with the guidance for major security
      types in GAAP on investments in debt and equity securities in paragraph
      320-10-50-lB. The disclosures are required for all investments within the
      scope of the amendments in this Update regardless of whether the fair
      value of the investment is measured using the practical expedient. The
      amendments in this Update apply to all reporting entities that hold an
      investment that is required or permitted to be measured or disclosed at
      fair value on a recurring or non recurring basis and, as of the reporting
      entity’s measurement date, if the investment meets certain criteria The
      amendments in this Update are effective for the interim and annual periods
      ending after December 15, 2009. Early application is permitted in
      financial statements for earlier interim and annual periods that have not
      been issued.
 F-9
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
  ·
              FASB
      ASC Topic 740, “Income Taxes”, an Accounting Standard Update. In September
      2009, the FASB issued this Update to address the need for additional
      implementation guidance on accounting for uncertainty in income taxes. The
      guidance answers the following questions: (i) Is the income tax paid by
      the entity attributable to the entity or its owners? (ii) What constitutes
      a tax position for a pass-through entity or a tax-exempt not-for-profit
      entity? (iii) How should accounting for uncertainty in income taxes be
      applied when a group of related entities comprise both taxable and
      nontaxable entities? In addition, this Updated decided to eliminate the
      disclosures required by paragraph 740-10-50-15(a) through (b) for
      nonpublic entities. The implementation guidance will apply to financial
      statements of nongovernmental entities that are presented in conformity
      with GAAP. The disclosure amendments will apply only to nonpublic entities
      as defined in Section 740-10-20. For entities that are currently applying
      the standards for accounting for uncertainty in income taxes, the guidance
      and disclosure amendments are effective for financial statements issued
      for interim and annual periods ending after September 15,
      2009.
  Note
3 - Inventory
  The
Company values its inventory under the FIFO method of costing under the lower of
cost or market pricing model. The Company reviews its product for old and or
obsolete items and adjusts accordingly. The Company’s inventory consists of
finished and raw material product.
  Note
4 - Property and Equipment
  At
September 30, 2009 and September 30, 2008, property and equipment are comprised
of the following:
  September
      30,2009
                
                
                2008Furniture
      and Office Equipment
                
                $
                97,611
                
                
                $
                96,513Computer
      Software
                
                
                13,609
                
                
                
                4,550Machinery
      and Equipment
                
                
                68,942
                
                
                
                151,939Less:
      Accumulated Depreciation
                
                
                (95,024
                )
                
                
                (72,483
                )Net
      Property & Equipment
                
                $
                85,138
                
                
                $
                180,519
  Depreciation
for the twelve months ended September 30, 2009 and 2008 was $33,296 and $33,143,
respectively.
  Note
5 – Business Combination and Related Party Transactions
  On April
30, 2007, the Company purchased, though a business combination, all of the
issued and outstanding membership interests of Griffin Filters LLC, (“Griffin”)
a company established since 1971 and engaged in the design, engineering &
supplying of industrial air filtration equipment from its President. Aron Govil,
the Chairman, Chief Executive Officer, Treasurer and President of the Company,
was the owner of 100% of the issued and outstanding membership interests of
Griffin. The Company purchased 100% ownership in Griffin for a purchase price of
$2,750,000.00. The Company completed the Griffin purchase by (i) paying cash of
$700,000; (ii) issuing 20,000,000 shares of common stock valued at $750,000; and
(iii) issuing a four year convertible debenture in the amount of $1,300,000 (see
Note 7). Griffin had sales and net income of $3,297,409 and $145,981
respectively for fiscal year ended September 30, 2006. Griffin is now a
wholly-owned subsidiary of the Company.
  The
Company recorded the combination of Griffin Filters, LLC as a “As is Pooling”
because of the related party interest as follows:
  F-10
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
  Accounts
      Receivable
                
                $
                530,506Inventory
                
                
                49,668Property
      & Equipment, Net
                
                
                67,018Other
      Assets
                
                
                4,225Accounts
      Payable
                
                
                (600,348
                )Additional
      Paid-in-Capital
                
                
                2,698,931Total
                
                $
                2,750,000
  These
consolidated financial statements have been retrospectively adjusted for all
periods presented.
  In
addition, the Company had the following related party transactions:
  ·
              The
      Company sold to Ducon Technologies India product totaling $450,000. Ducon
      is an enterprise owned by the majority stockholder of the
      Company.
  ·
              The
      Company leases space from Ducon Technologies, a related party, on a month
      to month basis.
  Note
6 – Note Payable Shareholder
  A Note
Payable to a shareholder totaling $390,520 is due October 1, 2011 and accrues
interest at 5% per annum.
  Note
7 – Convertible Debenture
  On
September 8th, 2009, Cemtrex, Inc. entered into a letter agreement with Arun
Govil, the Chairman, Chief Executive Officer, Treasurer and President of the
Company. Pursuant to the letter agreement Arun Govil agreed to cancel the
convertible promissory note, held by him, dated April 30, 2007.  The
principal balance of the Note was $1,300,000. Pursuant to the terms of the Note,
the Outstanding Amount was convertible into 30,000,000 shares of the Company’s
common stock. Pursuant to the letter agreement, in return for cancelling the
Note, the Company issued Arun Govil 2,500,000 shares of common stock of the
Company, par value $0.001 and 1,000,000 shares of Series A Preferred Stock of
the Company, par value $0.001 per share. Mr. Govil agreed to forfeit 27,500,000
shares of common stock issuable as per the original terms of the
Note.
  Note
8– Stockholders’ Equity
  Series
A Preferred Stock
  The
Company is authorized to issue 10,000,000 shares of Series A Preferred Stock,
$0.001 par value. As of September 30, 2009 and September 30, 2008, there were
1,000,000 and 0 shares issued and outstanding, respectively.
  Each
issued and outstanding Series A Preferred Share shall be entitled to the number
of votes equal to the result of: (i) the number of shares of common stock of the
Company issued and outstanding at the time of such vote multiplied by 1.01;
divided by (ii) the total number of Series A Preferred Shares issued and
outstanding at the time of such vote, at each meeting of shareholders of the
Company with respect to any and all matters presented to the shareholders of the
Company for their action or consideration, including the election of directors.
Holders of Series A Preferred Shares shall vote together with the holders of
Common Shares as a single class.
  On
September 8th , 2009, the Company issued 1,000,000 Series A Preferred Shares to
Arun Govil, the Chairman, Chief Executive Officer, Treasurer and President of
the Company, in conjunction with the of the conversion of a convertible note
(see Note 7).
  Common
Stock
  The
Company is authorized to issue 60,000,000 shares of common stock, $0.001 par
value. As of September 30, 2009 and 2008, there were 39,722,862 and 34,327,862
shares issued and outstanding, respectively.
  On
September 8th , 2009, the Company issued 2,500,000 common shares to Arun Govil,
the Chairman, Chief Executive Officer, Treasurer and President of the Company,
in conjunction with the of the conversion of a convertible note (see Note
7).  In addition, the Company issued 2,895,000 common shares for cash
totaling $8,525.
 F-11
 Cemtrex
Inc. and Subsidiaries
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
  Note
10 – Commitments & Contingencies
  Lease
Obligations
  The
Company leases its principal office at Farmingdale, New York, 4000 square feet
of office and warehouse/shop space in a single story commercial structure on a
month to month lease from Ducon Technologies Inc., at a monthly rental of
$2,157.
  The
Company’s subsidiary Griffin Filters LLC leases approx. 10,000 sq. ft. of office
and warehouse space in Liverpool, New York from a third party in a five year
lease at a monthly rent of $4,225 expiring on March 31, 2012.
  Legal
Proceedings
  The
Company is not currently involved in any lawsuits or litigation.
  Note
11 - Subsequent Events
  The
Company has evaluated all subsequent events through January 11, 2010, the date
this Annual Report on Form 10-K was filed with the SEC. There were no recognized
or unrecognized events requiring disclosure as significant subsequent
events.
   F-12