U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   FORM 10-QSB

[X]  QUARTERLY  REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

                  For the quarterly period ended March 31, 2006
                ------------------------------------------------


[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

     For the transition period from __________________ to _____________________

                         Commission file number 1-14244
           -----------------------------------------------------------

                         GLAS-AIRE INDUSTRIES GROUP LTD.
          --------------------------- --------------------------------
      (Exact name of small business registrant as specified in its charter)

                      NEVADA                                 84-1214736
--------------------------------------------   ---------------------------------
         (State or other  jurisdiction of
         incorporation  or  organization)      (IRS Employer Identification No.)

                 145 TYEE DRIVE, #1641, POINT ROBERTS, WA 98281
               --------------------------------------------------
                     (Address of principal executive office)

                                 (360) 447-0210
  ----------------------------------------------------------------------------
                          (Registrant telephone number)

        ----------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

     Securities registered pursuant to Section 12(B) of the Act:

                                                   Name of Each Exchange On
 Title of Each Class                                 Which Registered
--------------------                               -------------------------
   COMMON STOCK                                             OTC

         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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 ___X_____     No ________


Issuer's Common Stock:

     Common Stock, $0.01 par value-Issued 2,711,213 shares, not including 93,718
shares of treasury stock held by the Company as of March 31, 2006.

         Transitional Small Business Disclosure Format

        Yes_______        No___X____

<PAGE>



                         Glas-Aire Industries Group Ltd.

                                      INDEX



PART I.           FINANCIAL INFORMATION
<TABLE>
<CAPTION>
<S>  <C>                                                                                                      <C>
                                                                                                             PAGE
     Item 1.      Financial Statements

                  Consolidated Condensed Balance Sheets                                                        1
                  March 31, 2006 (Unaudited) and December 31, 2005

                  Consolidated Condensed Statements of Operations                                              2
                  For the three months ended March 31, 2006 and 2005 (Unaudited)

                  Consolidated Condensed Statement of Stockholder's Equity                                     3
                  For the three months ended March 31, 2006 (Unaudited)

                  Consolidated Condensed Statements of Cash Flows                                              4
                  For the three months ended March 31, 2006 and 2005 (Unaudited)

                  Notes to Consolidated Condensed Financial Statements (Unaudited)                             5-9

      Item 2.     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations                                               10

     Item 3.      Controls and Procedures                                                                     11

PART II.  OTHER INFORMATION                                                                                   11

     Item 1.      Legal Proceedings                                                                           11

     Item 2.      Changes in Securities                                                                       12

     Item 3.      Defaults Upon Senior Securities                                                             12

     Item 4.      Submission of Matters to a Vote of Security Holders                                         12

     Item 5.      Other Information                                                                           12

     Item 6.      Exhibits and Reports on Form 8-K                                                            12

SIGNATURES                                                                                                    13

</TABLE>


<PAGE>


                         Glas-Aire Industries Group Ltd.
                      Consolidated Condensed Balance Sheets
<TABLE>
<CAPTION>

                                                                     March 31,               December 31,
                                                                       2006                      2005
                                                                    (Unaudited)                (Audited)
                                                                  --------------             --------------
ASSETS
Current
<S>                                                               <C>                        <C>
     Cash and equivalents                                         $          161             $       1,832
                                                                  --------------             --------------

                                                                  $          161             $       1,832
                                                                  ==============             ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Current
     Accrued liabilities                                          $      422,471             $     382,731
     Income tax payable                                                   35,500                    35,500
                                                                  --------------             --------------
                                                                         457,971                   418,231
                                                                  --------------             --------------
     Stockholders' equity
     Common stock                                                         27,112                    27,112
     Additional paid-in capital                                        1,549,313                 1,549,313
     Accumulated Deficit                                              (2,687,013)               (2,645,602)
     Accumulated other comprehensive income
       Foreign currency translation adjustment                           652,778                   652,778
                                                                  --------------             --------------
                                                                        (457,810)                 (416,399)
                                                                  --------------             --------------
                                                                  $          161             $       1,832
                                                                  ==============             ==============
</TABLE>









                 See accompanying notes to financial statements

                                       1
<PAGE>



                         Glas-Aire Industries Group Ltd.
                 Consolidated Condensed Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                    Three Months Ended
                                                                    --------------------------------------------------
                                                                      March 31,                             March 31,
                                                                        2006                                 2005
                                                                    ---------------                     --------------

<S>                                                                 <C>                                 <C>
Sales                                                               $          0                        $        0
Cost of sales                                                                  0                                 0
                                                                    ---------------                     --------------
Gross profit                                                                   0                                 0
                                                                    ---------------                     --------------
Expenses
     General and administrative                                           40,167                            74,727
     Interest income                                                          (1)
     Interest expense                                                      1,245                                 0
                                                                    ---------------                     --------------
                                                                         (41,411)                           74,727
                                                                    ---------------                     --------------

Loss from operations before income taxes                                 (41,411)                           74,727
                                                                    ---------------                     --------------
Income tax  recovery                                                           0                                 0
                                                                    ---------------                     --------------

Net loss for the period                                                   41,411                            74,727
----------------------------------------------------------------------------------------------------------------------
Loss earnings per share basic and diluted                           $     (0.015)                       $   (0.028)
----------------------------------------------------------------------------------------------------------------------
Weighted average common shares outstanding                             2,711,213                          2,711,213
----------------------------------------------------------------------------------------------------------------------
</TABLE>



















                 See accompanying notes to financial statements

                                       2
<PAGE>

                         Glas-Aire Industries Group Ltd.
            Consolidated Condensed Statement of Stockholders' Equity
                        Three Months Ended March 31, 2006
                                   (Unaudited)

<TABLE>
<CAPTION>
--------------------- -------------- ------------ --------------- ---------------- -------------- ----------------- ----------------
<S>                   <C>            <C>          <C>             <C>              <C>            <C>               <C>

                         Common        Stock      Additional       Deferred        Accumulated     Accumulated        Stockholders'
                         Stock         Amount     Paid-in          Compensation    Deficit         Other              Equity
                                                  Capital          expense                         Comprehensive
                                                                                                   Income
--------------------- -------------- ------------ --------------- ---------------- --------------- ----------------- ---------------
Balance -
   December 31, 2005     2,711,213       $27,112      $1,549,313                -    $(2,645,602)         $652,778       $(416,399)
--------------------- -------------- ------------ --------------- ---------------- --------------- ----------------- ---------------

Net income                                                                               (41,411)                          (41,411)
--------------------- -------------- ------------ --------------- ---------------- --------------- ----------------- ---------------
Deferred compensation                                                           -                                                -
--------------------- -------------- ------------ --------------- ---------------- --------------- ----------------- ---------------
Foreign currency
 translation  adjustment                                                                                                         -
--------------------- -------------- ------------ --------------- ---------------- --------------- ----------------- ---------------
Balance -
   March 31, 2006        2,711,213       $27,112      $1,549,313                     $(2,687,013)         $652,778       $(457,810)
--------------------- -------------- ------------ --------------- ---------------- --------------- ----------------- ---------------
</TABLE>


















                 See accompanying notes to financial statements



                                       3

<PAGE>






                         Glas-Aire Industries Group Ltd
                 Consolidated Condensed Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                  Three Months Ended
                                                                      -----------------------------------------------
                                                                         March 31,                   March 31,
                                                                      -------------                ------------
                                                                           2006                        2005
<S>                                                                  <C>                           <C>
Increase (decrease) in cash
Cash flows from:
Operating activities
     Net loss for the period from operations                         $   (41,411)                  $  (74,727)
     Depreciation                                                              -
(Increase) decrease in assets
Increase (decrease) in liabilities
     Accrued liabilities                                                  39,740                       73,520
                                                                      -----------                  ------------

Net cash used  in operating activities                                    (1,671)                      (1,207)
                                                                      -----------                  ------------

Financing activities                                                           -                            -

Investing activities                                                           -                            -
                                                                      -----------                  ------------

Increase in cash and equivalents during the period                        (1,671)                      (1,207)
Cash and equivalents, beginning of period                                  1,832                       34,550
                                                                      -----------                  ------------
Cash and equivalents, end of period                                   $      161                   $   33,343
                                                                      ===========                  ============
</TABLE>


<TABLE>
<CAPTION>
                                                                                  Three Months Ended
                                                                      -----------------------------------------------
                                                                         March 31,                   March 31,
                                                                      -------------                ------------
                                                                           2006                        2005

Supplemental disclosure of cash flow relating to:

<S>                                                                   <C>                           <C>
     Interest paid                                                    $    1,245                    $       0


     Income taxes paid                                                 $       0                    $       0

</TABLE>






                 See accompanying notes to financial statements

                                       4
<PAGE>
                         Glas-Aire Industries Group Ltd.
              Notes to Consolidated Condensed Financial Statements
                                 March 31, 2006
                                   (Unaudited)


1.    NATURE OF BUSINESS AND BASIS OF PRESENTATION

         Glas-Aire  Industries Group Ltd., a Nevada  corporation (the "Company")
was incorporated on September 29, 1992. The Company manufactures and distributes
wind deflector products to automobile manufacturers in the United States, Canada
and Japan.

         The interim  financial  statements  included  herein,  are presented in
accordance  with United States  generally  accepted  accounting  principles  and
stated in United States dollars, and have been prepared by the Company,  without
audit, pursuant to the rules and regulations of the United States Securities and
Exchange Commission.

         Certain  information  and  footnote  disclosures  normally  included in
financial  statements  prepared in accordance with generally accepted accounting
principles   have  been  condensed  or  omitted   pursuant  to  such  rules  and
regulations,  although the Company believes that the disclosures are adequate to
make the information presented not misleading.

         These  financial  statements  reflect all  adjustments,  consisting  of
normal recurring adjustments,  which in the opinion of management, are necessary
for fair presentation of the information contained therein. It is suggested that
these  interim  financial  statements  be read in  conjunction  with the audited
financial  statements  of the Company for the years ended  December 31, 2005 and
2004 included in the Company's  10-KSB Annual  Report.  The Company  follows the
same accounting policies in the preparation of interim reports.

         Results of  operations  for the  interim  periods  are not  necessarily
indicative of annual results.

         These interim  financial  statements  include the amounts of its wholly
owned subsidiary Glas-Aire Industries Ltd., to March 23, 2004. On March 24, 2004
the  Canadian  Operation  filed  Bankruptcy  with the  Supreme  Court of British
Columbia. On July 31,2004 Glas-Aire  Industries,  Inc.'s warehouse operation was
closed.  Glas-Aire Industries Group Ltd. and all inter-company  transactions and
accounts have been eliminated from the statements.


2.    BANKRUPTCY

         On March 24,  2004 the  Supreme  Court of  British  Columbia  (Case No.
L040758) appointed KPMG. Inc. as receiver over all the right, title and interest
of Glas-Aire Industries Ltd, the wholly owned subsidiary of Glas-Aire Industries
Group  Ltd  (the  "Corporation"),   property,  assets,  and  undertakings.   The
Corporation was in default of certain financial ratios in its banking facilities
agreement with HSBC as was indebted to HSBC Bank for approximately  $2.7 million
(Canadian). The

                                       5
<PAGE>

                         Glas-Aire Industries Group Ltd.
              Notes to Consolidated Condensed Financial Statements
                                 March 31, 2006
                                   (Unaudited)

2.    BANKRUPTCY (CONTINUED)

Corporation  entered  into a  forbearance  agreement  with  HSBC to  attempt  to
restructure its debt for the next 3 months.  However the  forbearance  agreement
expired  on March 23,  2004 and HSBC  called the loans  into  default.  HSBC has
security on the Corporation's assets,  however, the assets are expected to yield
significantly  less  than  the  Corporation's  debt and it is  expected  that no
recovery is likely for the Corporation's unsecured creditors.

         Craig  Grossman,   President  and  Chief   Executive   Officer  of  the
Corporation  resigned as the sole officer and  director of Glas-Aire  Industries
Ltd. effective March 22, 2004.


3.  COMMON STOCK

         (a)      Authorized

                  30,000,000 Common shares with a par value of $0.01 each

                  1,000,000 Preferred shares with a par value of $0.01 each

         (b)      Issued and outstanding

                  2,711,213 Common shares

         At March 31, 2006 the Company had 110,000 (December 31, 2005 - 230,000)
options and 0 warrants  outstanding  and 93,718  shares of treasury  stock.  The
options and warrants were excluded  from the  calculation  of earnings per share
due to their anti-dilutive effect.


4.  STOCK BASED COMPENSATION

          Stock options granted to non-employees are accounted for in accordance
with the fair value method  prescribed  in SFAS No. 123 using the  Black-Scholes
option  pricing  model.  There were no stock  options  granted to  non-employees
during the period covered by these financial statements.

         The Company applies Accounting Principles Board ("APB') Opinion No. 25,
"Accounting  for Stock  issued to  Employees,"  and related  interpretations  in
accounting for stock option plans.  Under APB Opinion No. 25,  compensation cost
is  recognized  for stock  options  granted at prices  below market price of the
underlying  common  stock on date of grant.  Stock  options  granted  in tranche
(graded  vesting)  are  amortized  over the  respective  vesting  period of each
tranche.

                                       6
<PAGE>


                         Glas-Aire Industries Group Ltd.
              Notes to Consolidated Condensed Financial Statements
                                 March 31, 2006
                                   (Unaudited)


4.  STOCK BASED COMPENSATION (CONTINUED)

         The Company does not plan to adopt the fair value method of  accounting
for  stock-based  compensation  to employees.  Consequently,  related  pro-forma
information  as  required  under  SFAS  No.  123 has  been  disclosed  below  in
accordance with SFAS No. 148. To provide the require pro-forma information,  the
Company estimates the fair value of each warrant granted at the grant date using
the Black-Scholes option-pricing model.


5.   STOCK OPTIONS

INCENTIVE AND NON-QUALIFIED PLANS

         During  the  year  ended  January  31,  1997,  the  Company's  Board of
Directors  approved an  Incentive  Stock Option Plan and a  Non-Qualified  Stock
Option Plan.  Each plan provides for granting  options to purchase not more than
160,000 shares of the Company's common stock. The Incentive Stock Option Plan is
to be available to management  and employees of the Company.  The  Non-Qualified
Stock  Option  Plan is to be  available  to certain key  employees,  independent
contractors,  technical advisors and directors of the Company.  Vesting for both
plans will be determined at the date of grant.  Upon granting,  the options will
have a five year life.

         At March 31, 2006 no options had been granted under either plan.


DIRECTOR COMPENSATION

         In previous  periods the Company had granted  options to  directors  in
accordance   with  the   director's   compensation   program   approved  by  the
stockholders. A summary of the status of the Company's stock options outstanding
as of March 31, 2006 is as follows:

                                                          Number of    Exercise
                                                           Options       Price
                                                           ---------------------
Granted - November 4, 2001; Expiring - November 3, 2006      60,000   $    1.00
Granted - April 1, 2003; Expiring - March 31, 2008           50,000   $    0.75
                                                           ---------------------
                                                            110,000

         All 110,000 options are vested as of March 31, 2006.

         No options were granted in WTI (or its  predecessor,  Orbital) prior to
December 21, 2001.

                                       7
<PAGE>

                         Glas-Aire Industries Group Ltd.
              Notes to Consolidated Condensed Financial Statements
                                 March 31, 2006
                                   (Unaudited)


5.   STOCK OPTIONS (CONTINUED)

         SFAS No. 123  requires  the  Company to provide  pro-forma  information
regarding net loss as if the  compensation  costs for the Company's stock option
grants  had been  determined  in  accordance  with the fair value  based  method
prescribed in SFAS No. 123. To provide the required pro-forma  information,  the
Company  estimates  the fair value of each stock option  granted to directors at
the grant date using the Black-Scholes  option-pricing  model. The fair value of
stock options granted on December 4, 2001 to directors was $0.53 per option. The
fair value of stock options  granted on April 1, 2003 to the directors was $0.07
per option.  The options were excluded from the calculation of earning per share
due to their antidilutive effect.


6.   GOING CONCERN

         The accompanying  financial statements have been prepared assuming that
the Company will continue as a going concern.  The Company  generated net losses
of  $2,687,013  during the period from  September 29, 1992  (inception)  through
March 31, 2006. Also, on March 24, 2004 the Canadian  Operation filed Bankruptcy
with  the  Supreme  Court  of  British  Columbia.  On July  31,  2004  Glas-Aire
Industries,  Inc.'s  warehouse  operation  was closed.  These  conditions  raise
substantial  doubt about the Company's  ability to continue as a going  concern.
The  Company's  continuation  as a going  concern is dependent on its ability to
meet its  obligations,  to obtain  additional  financing  as may be required and
ultimately to attain profitability.  The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

         Management  plans to raise  additional  funds  through  debt or  equity
offerings.  Management  has not yet to decide what type of offering  the Company
will use or how much capital the Company will rise.  There is no guarantee  that
the Company will be able to raise any capital through any type of offerings.


7.    SUBSEQUENT EVENT

         The  Company's  directors  had held the  meeting on April 24,  2006 and
approved the following issuance of shares.

         The Company decided to issue 1,220,000  shares of the Company's  common
stock to Craig  Grossman and 1,220,000  shares of the Company's  common stock to
Linda Kwan in lieu of the  payment of their  services.  The  Company has accrued
compensation  to Craig  Grossman  and Linda Kwan in the amount of  approximately
$122,000 each.

                                       8
<PAGE>

                         Glas-Aire Industries Group Ltd.
              Notes to Consolidated Condensed Financial Statements
                                 March 31, 2006
                                   (Unaudited)


7.    SUBSEQUENT EVENT (CONTINUED)

         The Company  decided to issue  44,800  shares of the  Company's  common
stock to Craig  Grossman  and 191,972  shares of the  Company's  common stock to
Linda Kwan in connection with the payment of their personal funds paid for legal
fees is connection with the Bank Settlement.

         The Company decided to issue Schlueter & Associates,  P.C. (S&A) or its
assigns  400,000  shares of the  Company's  common  stock to settle the incurred
legal fees to S&A.

         The Company decided to issue Mark J. Richardson,  Esq. 93,750 shares of
the  Company's  common  stock to  consideration  for legal  and  other  services
rendered for the Company.
















                                       9

<PAGE>


ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION AND RESULT
OF OPERATIONS

CHANGES IN RESULTS OF OPERATIONS:  THREE MONTHS ENDED MARCH 31, 2006 COMPARED TO
THREE MONTHS ENDED MARCH 31, 2005

         General and  administrative  expenses  decreased  from  $40,167 for the
three  months  ended March 31, 2006 as compared to $74,727 for the three  months
ended  March 31,  2005.  This  decrease  is  primarily  due to (i) a decrease of
$20,880 in legal fees for the settlement of outstanding amounts, (ii) a decrease
of $23,805 in legal fees related to loan guarantees with HSBC, (iii) an increase
of $10,125 in consulting and other operating costs related to a potential merger
agreement.

         Interest  expenses  increase was related to loan  guarantee  settlement
with HSBC.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES.

ACCOUNTING ESTIMATES.

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

FOREIGN CURRENCY TRANSLATION AND TRANSACTIONS

         The Company conducts  business in both Canada and the United States and
used the U.S. dollar as tits reporting  currency.  The function  currency of the
Canadian  subsidiaries is the Canadian dollar.  The financial  statements of the
Canadian  subsidiaries  have  been  translated  under  SFAS No.  52.  Asset  and
liabilities are translated at the rate of exchange at the balance sheet date and
revenues and expenses are  translated  at the average  exchange  rate during the
year. The resulting  exchange gains and losses are shown as a separate component
of stockholders' equity.

         Transactions conducted in foreign currencies are translated as follows:

         At the transaction date, each asset, liability,  revenue and expense is
translated by the use of the exchange rate in effect at that date. At the period
and date,  monetary  assets and liabilities are translated by using the exchange
rate in effect at that date. The resulting foreign exchange gains and losses are
included in income in the current period.

                                       10
<PAGE>

RECENT ACCOUNTING PRONOUNCEMENTS

         On May 15, 2003,  the Financial  Accounting  Standards  Board  ("FASB")
issued Statement of Financial  Accounting Standard ("SFAS") No. 150, "Accounting
for Certain Financial  Instruments with  Characteristics of both Liabilities and
Equity".  SFAS No. 150 changes the accounting for certain financial  instruments
that,  under  previous  guidance,  could be classified as equity or  "mezzanine"
equity,  by now requiring those  instruments to be classified as liabilities (or
assets in some  circumstances)  in the  balance  sheet.  Further,  SFAS No.  150
requires  disclosure  regarding the terms of those  instruments  and  settlement
alternatives.  SFAS No. 150 affects an entity's  classification of the following
freestanding  instruments:  a)  Mandatory  redeemable  instruments  b) Financial
instruments  to  repurchase  an entity's  own equity  instruments  c)  Financial
instruments embodying obligations that the issuer must or could choose to settle
by issuing a variable  number of its shares or other  equity  instruments  based
solely on (i) a fixed monetary amount known at inception or (ii) something other
than  changes  in its own equity  instruments  d) SFAS No. 150 does not apply to
features  embedded in a financial  instrument  that is not a  derivative  in its
entirety.  The guidance in SFAS No. 150 is generally effective for all financial
instruments  entered  into or  modified  after May 31,  2003,  and is  otherwise
effective at the beginning of the first interim period  beginning after June 15,
2003.

         The  implementation of this new standard did not have a material effect
on our consolidated financial statements.

ITEM 3.  CONTROLS AND PROCEDURES

         The Company's management, with the participation of the Company's Chief
Executive  Officer and Chief Financial  Officer,  evaluated the effectiveness of
the Company's  disclosure controls and procedures (as defined in Rules 13a-15(e)
and  15d-15(e)  under the  Securities  Exchange  Act of 1934,  as  amended  (the
"Exchange  Act"))  as of  December  31,  2005.  Based  on this  evaluation,  the
Company's Chief Executive Officer and Chief Financial Officer concluded that, as
of December 31, 2005, the Company's  disclosure controls and procedures were (1)
designed to ensure that material  information  relating to the Company,  is made
known to the Company's  Chief Executive  Officer and Chief Financial  Officer by
others within the Company,  particularly  during the period in which this report
was being prepared and (2) effective,  in that they provide reasonable assurance
that information  required to be disclosed by the Company in the reports that it
files or submits under the Exchange Act is recorded,  processed,  summarized and
reported within the time periods specified in the SEC's rules and forms.


PART II.   OTHER INFORMATION

                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         We are involved in certain legal proceedings, claims and litigation. As
of the  date of the  filing  of this  Quarterly  Report,  there  has been no new
litigation  or new  developments  in any pending  litigation  that have not been
previously reported.

                                       11
<PAGE>

DRAGON CAPITAL

         On August 8, 2003,  Dragon Capital,  LLC ("dragon")  filed suit against
the Company in Denver District Court (Case No. 03CV6198). Dragon alleges that we
have  refused to pay a success fee in the amount of $59,000 in  connection  with
the  Company's  merger with Wonder Tool,  Inc. The  Claimant  alleges  breach of
contract  claim,  promissory  estoppel  and  unjust  enrichment  against  us. On
September 25, 2003, we filed our answer to the  Complaint.  Management  believes
this claim is entirely  without merit and intends to vigorously  defend  against
this claim.

ITEMS 2, 3 AND 4 ARE NOT APPLICABLE.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     a)   Exhibits:

          31.1 Section 302 Certification

          32.1 Section 906 Certification

     b)   Reports Filed on Form 8-K.

         A Report for Entry into a Definitive Agreement was filed on form 8-K on
May 18, 2006 to disclose the Letter of intent for reverse  Merger with a private
company.

         Glas-Aire Industries Group, Ltd.  ("Glas-Aire") recently entered into a
Letter of Intent with Pacific Environmental Sampling, Inc., a private California
corporation  ("ESP"),  pursuant to which Glas-Aire has agreed to acquire 100% of
ESP's  outstanding  capital  stock.  The  Letter  of Intent  is  subject  to the
execution  of a  definitive  stock  purchase  agreement.  ESP is  engaged in the
business of conducting indoor air quality  inspection tests and moisture surveys
to detect  mold and other  toxins in homes and  commercial  establishments,  and
preparing  certified  reports.  ESP also sells  franchises to other assessors to
conduct the same  business.  Glas-Aire  will acquire ESP's stock in exchange for
ESP's purchase of 14,625,000 shares of Glas-Aire's  common stock,  approximately
90.1%  of  Glas-Aire's  outstanding  stock  at the  closing,  as well  as  ESP's
assumption  of certain  liabilities  of Glas-Aire,  and certain other  covenants
between the parties.



                                       12
<PAGE>



                                   SIGNATURES

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


Date   August 16, 2006

                               GLAS-AIRE INDUSTRIES GROUP LTD.



                               /s/Craig Grossman
                               ----------------------------------------------
                               Craig Grossman
                               President, Chief Executive Officer and Secretary



                               /s/ Linda Kwan
                               ----------------------------------------------
                               Linda Kwan, Chief Financial Officer


Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
this  report has been  signed  below by the  following  persons on behalf of the
registrant and in the capacities and on the dates indicated.

By:  \s\ Craig Grossman                                 Dated: August 16, 2006
    ---------------------------------------------------
      Craig Grossman, Chairman of the Board,
      Chief Executive Officer, President,
      and Secretary (Principal Executive Officer)

By:  \s\ Linda Kwan                                     Dated: August 16, 2006
    ---------------------------------------------------
      Linda Kwan, Chief Financial Officer
      (Principal Financial/Accounting Officer)


                                       13