**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-QSB**





x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)


OF
      THE
      SECURITIES ACT OF 1934




**For
      the quarterly period ended June 30, 2008**





OR





 ̈ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)


OF
      THE
      SECURITIES ACT OF 1934





**For
      the transition period from ___________to ____________**





**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)





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.





(1)
      Yes x No  ̈





(2)
      Yes  ̈ No x





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act): Yes  ̈ No x





APPLICABLE
      ONLY TO CORPORATE ISSUERS:





State
      the
      number of shares outstanding of each of the issuer's class of common equity,
      as
      of the latest practicable date: At August 12, 2008, the issuer had outstanding
      34,327,862 shares of Common Stock, par value $0.001 per share.




Transitional
      Small Business Disclosure Format (Check one): Yes  ̈ No x









**CEMTREX,
      INC.**





**INDEX**





PART
                I. FINANCIAL INFORMATIONItem
                1. Financial Information
            3CONSOLIDATED
                BALANCE SHEET AS OF JUNE 30, 2008 (UNAUDITED)
            4CONSOLIDATED
                STATEMENTS OF OPERATIONS FOR THE THREE MONTHS AND NINE MONTHS ENDED
                JUNE
                30, 2008 AND JUNE 30, 2007(UNAUDITED)
            5CONSOLIDATED
                STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIENCY) FOR THE PERIOD
                FROM SEPTEMBER 30, 2006 TO JUNE 30, 2008 (UNAUDITED)
            6CONSOLIDATED
                STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED JUNE 30, 2008
                AND JUNE
                30, 2007 (UNAUDITED)
            7Item
                2. Management's Discussion and Analysis or Plan of
                Operations
            14Item
                3. Controls and Procedures
            32Item
                3A(T). Controls and Procedures
            33PART
                II. OTHER INFORMATIONItem
                1. Legal Proceedings
            33Item
                2. Unregistered Sales of Equity Securities and Use of
                Proceeds
            34Item
                3. Defaults upon Senior Securities
            34Item
                4. Submission of Matters to a Vote of Security Holders
            34Item
                5. Other Information
            34Item
                6. Exhibits
            34Signatures
            35




Page
          2 of
          35




PART
      I —
FINANCIAL INFORMATION





ITEM
      1.
      FINANCIAL STATEMENTS




THE
      ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL
      STATEMENTS.




**CEMTREX,
      INC.**





**CONTENTS**





PAGE
            4
            CONSOLIDATED
                BALANCE SHEET AS OF JUNE 30, 2008 (UNAUDITED)PAGE
            5
            CONSOLIDATED
                STATEMENTS OF OPERATIONS FOR THE THREE MONTHS AND NINE MONTHS ENDED
                JUNE
                30, 2008 AND JUNE 30, 2007(UNAUDITED)PAGE
            6
            CONSOLIDATED
                STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIENCY) FOR THE PERIOD
                FROM SEPTEMBER 30, 2006 TO JUNE 30, 2008 (UNAUDITED)PAGE
            7
            CONSOLIDATED
                STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED JUNE 30, 2008
                AND JUNE
                30, 2007 (UNAUDITED)PAGES
            8 –
                13
            NOTES
                TO UNAUDITED FINANCIAL STATEMENTS




Page
          3 of
          35




**Cemtrex,
          Inc. and Subsidiary**
 **Consolidated
          Balance Sheets**
  **June 30,**
                
                **September 30,****2008**
                
                **2007****Unaudited****Assets**Current
                    AssetsCash
                    & Equivalents
                
                $
                218,661
                
                $
                143,830Accounts
                    Receivable
                
                
                700,346
                
                
                780,474Inventory
                
                
                374,161
                
                
                252,443Prepaid
                    Expenses & Other Assets
                
                
                -
                
                
                4,225Total
                    Current Assets
                
                
                1,293,168
                
                
                1,180,972Property
                    & Equipment, Net
                
                
                200,084
                
                
                61,723Other
                
                
                29,563
                
                
                22,024Goodwill,
                    Net
                
                
                2,973,813
                
                
                2,973,813**Total
                    Assets**
                
                **$**
                **4,496,628**
                
                **$**
                **4,238,532****Liabilities
                    & Stockholders' Equity (Deficit)**Current
                    LiabilitiesAccounts
                    Payable
                
                $
                728,856
                
                $
                914,907Accrued
                    Expenses
                
                
                93,675
                
                
                448,640Income
                    Taxes Payable
                
                
                31,100
                
                
                -Customer
                    Deposits
                
                
                -
                
                
                85,516Notes
                    Payable-Shareholder
                
                
                548,711
                
                
                8,983Total
                    Current Liabilities
                
                
                1,402,342
                
                
                1,458,046Convertible
                    Debenture
                
                
                1,300,000
                
                
                1,300,000Total
                    Liabilities
                
                
                2,702,342
                
                
                2,758,046Commitments
                    & Contingencies
                
                
                -
                
                
                -Stockholders'
                    Equity (Deficit)Common
                        Stock, $0.001 par value, 60,000,000 shares authorized; 34,327,862
                        shares
                        issued and outstanding.
                
                
                34,328
                
                
                34,328Additional
                    Paid-in Capital
                
                
                1,644,172
                
                
                1,644,172Accumulated
                    Deficit
                
                
                115,786
                
                
                (198,014
                )Total
                    Stockholders' Equity (Deficit)
                
                
                1,794,286
                
                
                1,480,486**Total
                    Liabilities & Stockholders' Equity (Deficit)**
                
                **$**
                **4,496,628**
                
                **$**
                **4,238,532**
 
 ***The
          accompanying notes are an integral part of these financial
          statements***
 Page
            4 of
            35
 **Cemtrex,
          Inc. and Subsidiary**
 **Consolidated
          Statements of Operations**
 **Unaudited**
  **For the Three Months**
                
                **For the Nine Months****Ended**
                
                **Ended,****June 30,**
                
                **June 30,****2008**
                
                **2007**
                
                **2008**
                
                **2007**Revenues
                
                $
                1,272,314
                
                $
                1,636,171
                
                $
                4,514,788
                
                $
                2,288,276Cost
                    of Goods Sold
                
                
                662,585
                
                
                1,143,479
                
                
                2,434,930
                
                
                1,392,120Gross
                    Profit
                
                
                609,729
                
                
                492,692
                
                
                2,079,858
                
                
                896,156Operating
                    Expenses
                
                
                511,126
                
                
                805,683
                
                
                1,643,528
                
                
                987,928Operating
                    Income (Loss)
                
                
                98,603
                
                
                (312,991
                )
                
                436,330
                
                
                (91,772
                )Other
                    Income (Expense)Other
                    Income
                
                
                -
                
                
                15,186
                
                
                606
                
                
                23,936Interest
                    Expense
                
                
                (31,409
                )
                
                -
                
                
                (92,036
                )
                
                -Total
                    Other Income (Expense)
                
                
                (31,409
                )
                
                15,186
                
                
                (91,430
                )
                
                23,936Net
                    Income (Loss) Before Income Taxes
                
                
                67,194
                
                
                (297,805
                )
                
                344,900
                
                
                (67,836
                )Provision
                    for Income Taxes
                
                
                -
                
                
                -
                
                
                (31,100
                )
                
                -Net
                    Income (Loss)
                
                $
                67,194
                
                $
                (297,805
                )
                $
                313,800
                
                $
                (67,836
                )Income
                    (Loss) Per Share-Basic and Diluted
                
                $
                0.00
                
                $
                (0.01
                )
                $
                0.01
                
                $
                (0.00
                )Weighted
                    Average Number of Shares
                
                
                34,327,862
                
                
                24,044,144
                
                
                34,327,862
                
                
                18,208,407
  ***The
          accompanying notes are an integral part of these financial statements***
  Page
            5 of
            35
 **Cemtrex,
          Inc. and Subsidiary**
 **Consolidated
          Statements of Stockholders' Equity (Deficit)**
  **Common Stock**
                
                
                
                
                
                **Total****Number of****Shares**
                
                **Par Value****($0.001)****Amount**
                
                **Additional****Paid-In-Capital**
                
                **Accumulated**
                  **Deficit**
                
                ******Stockholders'**
                  **Equity (Deficit)****Balance
                    at September 30, 2006**
                
                **6,880,213**
                
                **$
                    6,880**
                
                **$
                    543,120**
                
                **$
                    (74,449)**
                
                **$
                    475,551**Common
                    Stock Issued to Investors for Cash
                
                
                7,447,649
                
                
                7,448
                
                
                371,052
                
                
                -
                
                
                378,500Common
                    Stock Issued for Purchase of Assets
                
                
                20,000,000
                
                
                20,000
                
                
                730,000
                
                
                -
                
                
                750,000Net
                    Loss
                
                
                -
                
                
                -
                
                
                -
                
                
                (123,565
                )
                
                (123,565
                )**Balance
                    at September 30, 2007**
                
                
                **34,327,862**
                
                **$**
                **34,328**
                
                **$**
                **1,644,172**
                
                **$**
                **(198,014**
                **)**
                **$**
                **1,480,486**Net
                    Income
                
                
                -
                
                
                -
                
                
                -
                
                
                313,800
                
                
                313,800**Balance
                    at June 30, 2008 (Unaudited)**
                
                
                **34,327,862**
                
                **$**
                **34,328**
                
                **$**
                **1,644,172**
                
                **$**
                **115,786**
                
                **$**
                **1,794,286**
  ***The
          accompanying notes are an integral part of these financial
          statements***
  Page
            6 of
            35
 **Cemtrex,
          Inc. and Subsidiary**
 **Consolidated
          Statements of Cash Flows**
 **Unaudited**
  **For the Nine Months****Ended,June
                    30,****2008**
                
                **2007****Cash
                    Flows from Operating Activities**Net
                    Income (Loss)
                
                $
                313,800
                
                $
                (67,836
                )Adjustments
                    to reconcile net loss to net cash used in operating
                    activities:Depreciation
                    & Amortization
                
                
                13,578
                
                
                2,118Changes
                    in operating assets and liabilities:Accounts
                    Receivable
                
                
                80,128
                
                
                (682,287
                )Inventory
                
                
                (121,718
                )
                
                (19,845
                )Prepaid
                    Expenses & Other Assets
                
                
                4,225
                
                
                15,224Other
                    Assets
                
                
                (7,539
                )
                
                (26,249
                )Accounts
                    Payable
                
                
                (186,051
                )
                
                801,875Accrued
                    Expenses
                
                
                (354,965
                )
                
                448,640Income
                    Taxes Payable
                
                
                31,100
                
                
                -Customer
                    Deposits
                
                
                (85,516
                )
                
                692**Net
                    Cash Used in Operating Activities**
                
                
                **(312,958**
                **)**
                
                **472,332****Cash
                    Flows from Investing Activities**Purchase
                    of Property and Equipment
                
                
                (151,939
                )
                
                (67,018
                )Net
                    Purchase of Griffin Filters
                
                
                -
                
                
                (506,430
                )Goodwill
                    from Ducon
                
                
                -
                
                
                (142,501
                )**Net
                    Cash Used in Investing Activities**
                
                
                **(151,939**
                **)**
                
                **(715,949**
                **)****Cash
                    Flows from Financing Activities**Net
                    Loans from Shareholders
                
                
                539,728
                
                
                -Common
                    Stock Issued for Cash
                
                
                -
                
                
                378,500**Net
                    Cash Provided by Financing Activities**
                
                
                **539,728**
                
                
                **378,500****Net
                    Increase (Decrease) in Cash**
                
                
                **74,831**
                
                
                **134,883**Cash
                    Beginning of Period
                
                
                143,830
                
                
                29,279**Cash
                    at End of Period**
                
                **$**
                **218,661**
                
                **$**
                **164,162**Supplemental
                    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:Convertible
                    Debentures issued for Griffin Purchase
                
                $
                -
                
                $
                1,300,000Common
                    Stock Issued for Griffin Acquisition
                
                
                -
                
                
                750,000
  ***The
          accompanying notes are an integral part of these financial
          statements***
  Page
            7 of
            35
 **CEMTREX,
          INC.**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **Unaudited**
 **Note
        1 – Organization, Business & Operations**
  Cemtrex,
        Inc. and its Subsidiary 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, Company designs,
        manufactures and sells air filtration equipment and systems to control
        particulate emissions from 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 4 Acquisitions and
        Goodwill).
  **Note
        2 - Summary of Significant Accounting Policies**
  **Accounting** **Method**
  The
        Company’s financial statements are prepared using the accrual method of
        accounting. The Company has elected a September 30 year-end.
  **Principles
        of Consolidation**
  The
        accompanying consolidated financial statements include the accounts of Cemtrex,
        Inc and its wholly owned subsidiary Griffin Filters, LLC, (collectively the
        “Company”). All significant inter-company accounts and transactions have been
        eliminated in consolidation.
  **Use
        of Estimates**
  The
        preparation of financial statements in conformity with accounting principles
        generally accepted in the United States of America requires management to
        make
        estimates and assumptions that affect the reported amounts of assets and
        liabilities at the date of the financial statements and the reported amounts
        of
        expenses during the reporting period. Actual results could differ from those
        estimates.
  **Cash
        and Cash Equivalents**
  The
        Company considers all highly liquid investments with a maturity of three
        months
        or less when purchased 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.
  **Marketable
        Securities Available for Sale**
  The
        Company evaluates its investment policies and the appropriate classification
        of
        securities at the time of purchase consistent with Statement of Financial
        Accounting Standards ("SFAS") No. 115, "Accounting for Certain investments
        in
        Debt and Equity Securities," at each balance sheet date and determined that
        all
        of its investment securities are to be classified as available-for-sale.
        Available-for-sale securities are carried at fair value, with the unrealized
        gains and losses, net of tax, reported in stockholders' deficiency under
        the
        caption "Accumulated Other Comprehensive Loss". Realized gains and losses
        and
        declines in value judged to be other than-temporary on available-for-sale
        securities are included in net gain on sale of marketable securities. The
        cost
        of securities sold is based on the specific identification method.
  Page
            8 of
            35
 **CEMTREX,
          INC.**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **Unaudited**
 **Inventories**
  Inventories
        are comprised of replacement parts and system, 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.
  **Revenue
        Recognition**
  Revenue
        is recognized in accordance with SEC Staff Accounting Bulletin No. 101, “Revenue
        Recognition in Financial Statements.” The Company recognizes revenue when the
        significant risks and rewards of ownership have been transferred to the customer
        pursuant to applicable laws and regulations, including factors such as when
        there has been evidence of a sales arrangement, delivery has occurred, or
        service have been rendered, the price to the buyer is fixed or determinable,
        and
        collectibility is reasonably assured.
  **Income
        Taxes**
  The
        Company accounts for income taxes using the liability method as required
        by
        Statement of Financial Accounting Standards ("FASB") No. 109, Accounting
        for
        Income Taxes ("SFAS 109"). Under this method, deferred tax assets and
        liabilities are determined based on differences between their financial
        reporting and tax basis of assets and liabilities.
  **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.
  **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 has adopted the disclosure provisions only of SFAS 123 and continues
        to
        account for stock based compensation using the intrinsic value method prescribed
        in accordance with the provisions of APB No. 25, Accounting for Stock Issued
        to
        Employees, and related interpretations. Common stock issued to employees
        for
        compensation is accounted for based on the market price of the underlying
        stock,
        generally the average low bid price.
  The
        Company accounts for stock-based compensation issued to non-employees and
        consultants in accordance with the provisions of SFAS 123 and the Emerging
        Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting
        for
        Equity Instruments that are Issued to Other Than Employees for Acquiring
        or in
        Conjunction with Selling, Goods or Services". Common stock issued to
        non-employees in exchange for services is accounted for based on the fair
        value
        of the services received.
  **Allowance
        for doubtful accounts**
  In
        determining the allowance to be maintained, management evaluates many factors
        including industry and historical loss experience. The allowance for doubtful
        accounts is maintained at an amount management deems adequate to cover estimated
        losses. At June 30, 2008 and September 30, 2007, the Company has reserved
        $100,000 for doubtful accounts.
  Page
            9 of
            35
 **CEMTREX,
          INC.**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **Unaudited**
 **Advertising**
  The
        Company incurred no advertising expenses for the periods ended June 30, 2008
        and
        September 30, 2007.
  **Research
        and development costs**
  Expenditures
        for research & development are expensed as incurred. Such costs are required
        to be expensed until the point that technological feasibility is established.
        The Company incurred no research and development costs for the periods ended
        June 30, 2008 and September 30, 2007.
  **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).
  **Recently
        Issued Accounting Pronouncements**
  In
        December 2007, the FASB issued SFAS No. 141(R), Business Combinations (FAS
        141(R)). This Statement provides greater consistency in the accounting and
        financial reporting of business combinations. It requires the acquiring entity
        in a business combination to recognize all assets acquired and liabilities
        assumed in the transaction, establishes the acquisition-date fair value as
        the
        measurement objective for all assets acquired and liabilities assumed, and
        requires the acquirer to disclose the nature and financial effect of the
        business combination. FAS 141(R) is effective for fiscal years beginning
        after
        December 15, 2008. We will adopt FAS 141(R) no later than the first quarter
        of
        fiscal 2010 and are currently assessing the impact the adoption will have
        on our
        financial position and results of operations.
  In
        December 2007, the FASB issued SFAS No. 160. Noncontrolling Interests in
        Consolidated Financial Statements (FAS 160). This Statement amends Accounting
        Research Bulletin No. 51, Consolidated Financial Statements, to establish
        accounting and reporting standards for the noncontrolling interest in a
        subsidiary and for the deconsolidation of a subsidiary. FAS 160 is effective
        for
        fiscal years beginning after December 15, 2008. We will adopt FAS 160 no
        later
        than the first quarter of fiscal 2010 and are currently assessing the impact
        the
        adoption will have on our financial position and results of operations.
  In
        February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial
        Assets and Financial Liabilities , which permits entities to choose to measure
        at fair value eligible financial instruments and certain other items that
        are
        not currently required to be measured at fair value. The standard requires
        that
        unrealized gains and losses on items for which the fair value option has
        been
        elected be reported in earnings at each subsequent reporting date. SFAS No.
        159
        is effective for fiscal years beginning after November 15, 2007. We will
        adopt
        SFAS No. 159 no later than the first quarter of fiscal 2009. We are currently
        assessing the impact the adoption of SFAS No. 159 will have on our financial
        position and results of operations.
  In
        September 2006, the FASB issued SFAS No. 158, Employers’ Accounting for Defined
        Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements
        No. 87, 88, 106, and 132(R) . SFAS No. 158 requires company plan sponsors
        to
        display the net over- or under-funded position of a defined benefit
        postretirement plan as an asset or liability, with any unrecognized prior
        service costs, transition obligations or actuarial gains/losses reported
        as a
        component of other comprehensive income in shareholders’ equity. SFAS No. 158 is
        effective for fiscal years ending after December 15, 2006. We adopted the
        recognition provisions of SFAS No. 158 as of the end of fiscal 2007. The
        adoption of SFAS No. 158 did not have an effect on the Company’s financial
        position or results of operations.
  In
        September 2006, the FASB issued SFAS No. 157, Fair Value Measurements . SFAS
        No.
        157 establishes a framework for measuring fair value in generally accepted
        accounting principles, clarifies the definition of fair value and expands
        disclosures about fair value measurements. SFAS No. 157 does not require
        any new
        fair value measurements. However, the application of SFAS No. 157 may change
        current practice for some entities. SFAS No. 157 is effective for financial
        statements issued for fiscal years beginning after November 15, 2007, and
        interim periods within those fiscal years. We will adopt SFAS No. 157 in
        the
        first quarter of fiscal 2009. We are currently assessing the impact that
        the
        adoption of SFAS No. 157 will have on our financial position and results
        of
        operations.
  Page
            10
            of 35
 **CEMTREX,
          INC.**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **Unaudited**
 In
        July
        2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in
        Income Taxes — an interpretation of FASB Statement No. 109 (FIN 48). This
        interpretation clarifies the application of SFAS No. 109, Accounting for
        Income
        Taxes , by defining a criterion that an individual tax position must meet
        for
        any part of the benefit of that position to be recognized in an enterprise’s
        financial statements and also provides guidance on measurement, derecognition,
        classification, interest and penalties, accounting in interim periods,
        disclosure and transition. FIN 48 is effective for fiscal years beginning
        after
        December 15, 2006, but earlier adoption is permitted. The Company is in the
        process of evaluating the impact of the application of the Interpretation
        to its
        financial statements. In February 2007, the FASS issued SFAS No. 159, "The
        Fair
        Value Option for Financial Assets and Liabilities" ("SFAS No. 159"). SFAS
        No.
        159 provides companies with an option to report selected financial assets
        and
        liabilities at fair value, and establishes presentation and disclosure
        requirements designed to facilitate comparisons between companies that choose
        different measurement attributes for similar types of assets and liabilities.
        The new guidance is effective for fiscal years beginning after November 15,
        2007. The Company is currently evaluating the potential impact of the adoption
        of SFAS No. 159 on its financial position and results of
        operations.
  **Note
        3 - Property and Equipment**
  At
        June
        30, 2008 and September 30, 2007, property and equipment are comprised of
        the
        following:
 **June 30,**
                
                **September 30,****2008**
                
                **2007**Furniture
                    and Office Equipment
                
                $
                82,590
                
                $
                82,590Computer
                    Software
                
                
                4,550
                
                
                4,550Machinery
                    and Equipment
                
                
                151,939
                
                
                -Less:
                    Accumulated Depreciation
                
                
                (38,995
                )
                
                (25,417
                )Net
                    Property & Equipment
                
                $
                200,084
                
                $
                61,723
  Depreciation
        for the nine months ended June 30, 2008 and 2007 was $13,578 and $2,118,
        respectively.
  **Note
        4** **–
        Acquisitions and Goodwill**
  On
        May 1,
        2007, Cemtrex, Inc. purchased Griffin Filters, LLC for $2,750,000 for a
        combination of stock ($750,000), a convertible debenture ($1,300,000) and
        cash
        of $700,000.
  **Note
        5** **–
        Customer Deposits**
  The
        Company accounts for payments received prior to shipment as a liability and
        recognizes revenue when the products are shipped.
  **Note
        6** **–
        Note Payable Shareholder**
  A
        Note
        Payable to a shareholder is due within the next year and accrues interest
        at
        5%.
  **Note7 –
        Convertible Debenture**
  On
        April
        30, 2007, the Company issued a $1,300,000 Convertible Debenture to an Officer
        of
        the Company in conjunction with the Purchase of Griffin Filters, Inc. The
        debenture caries 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 is due and payable on April 30, 2011.
  The
        debenture has the right of conversion into 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 January 1, 2008 and continuing to
        April
        30, 2011, the Debenture Holder shall have the right of conversion subject
        o the
        terms and conditions of the debenture. In the event the face amount of the
        debenture is not fully converted on or before April 30, 2011, the conversion
        rights will lapse.
  Page
            11
            of 35
 **CEMTREX,
          INC.**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **Unaudited**
 **Note
        8 –Prior Financial Statements**
  For
        comparative purposes, the following depicts the Consolidated Statements of
        Operations had the entities been together for the periods
        indicated.
 **For
                    the Three Months**
                
                **For
                    the Nine Months****Ended**
                
                **Ended,****June
                    30,**
                
                **June
                    30,****2008**
                
                **2007**
                
                **2008**
                
                **2007**Revenues
                
                $
                1,272,314
                
                $
                1,789,238
                
                $
                4,514,788
                
                $
                4,546,179Cost
                    of Goods Sold
                
                
                662,585
                
                
                1,168,127
                
                
                2,434,930
                
                
                2,979,853Gross
                    Profit
                
                
                609,729
                
                
                621,111
                
                
                2,079,858
                
                
                1,566,326Operating
                    Expenses
                
                
                511,126
                
                
                907,086
                
                
                1,643,528
                
                
                1,409,234Operating
                    Income (Loss)
                
                
                98,603
                
                
                (285,975
                )
                
                436,330
                
                
                157,092Other
                    Income (Expense)Other
                    Income
                
                
                -
                
                
                57,091
                
                
                606
                
                
                87,551Interest
                    Income
                
                
                -
                
                
                -
                
                
                -
                
                
                -Interest
                    Expense
                
                
                (31,409
                )
                
                -
                
                
                (92,036
                )
                
                -Total
                    Other Income (Expense)
                
                
                (31,409
                )
                
                57,091
                
                
                (91,430
                )
                
                87,551Net
                    Income (Loss) Before Income Taxes
                
                
                67,194
                
                
                (228,884
                )
                
                344,900
                
                
                244,643Provision
                    for Income Taxes
                
                
                -
                
                
                -
                
                
                (31,100
                )
                
                -Net
                    Income (Loss)
                
                $
                67,194
                
                $
                (228,884
                )
                $
                313,800
                
                $
                244,643
  **Note
        9– Stockholders’ Equity**
  **Preferred
        Stock**
  The
        Company is authorized to issue 10,000,000 shares of preferred stock, $0.001
        par
        value. As of June 30, 2008 and September 30, 2007, there were no shares issued
        and outstanding.
  **Common
        Stock**
  The
        Company is authorized to issue 60,000,000 shares of common stock, $0.001
        par
        value. As of March 31, 2008 and September 30, 2007, there were 34,327,862
        shares
        issued and outstanding..
  **2008**
  No
        shares
        were issued during the nine months ended June 30, 2008.
  **2007**
  For
        the
        year ended September 30, 2007, the Company issued 7,447,649 shares of Common
        Stock to investors for cash totaling $378,500. In addition, the Company issued
        20,000,000 shares of Common Stock to an Officer in conjunction with the
        acquisition of Griffin Filters totaling $750,000.
  **Note
        10** **–
        Commitments & Contingencies**
  **Lease
        Obligations** ****
  The
        Company leases its corporate office space on a month-to-month basis with
        minimum
        monthly payments of $2,157.
  The
        Company leases its Manufacturing office space on a 5 year lease agreement
        with
        minimum monthly payments of $4.225. This lease expires March 30,
        2012.
  Page
            12
            of 35
 **CEMTREX,
          INC.**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **Unaudited**
 **Legal
        Proceedings**
  The
        Company is not currently involved in any lawsuits or litigation.
  **Note
        11** **- Subsequent Events**
  There
        are
        no material subsequent events.
  Page
            13
            of 35




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





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" in our Form 10 filed
      June 19, 2008 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.





OVERVIEW





Cemtrex
      Inc. ("Cemtrex" or the "Company") is a Delaware corporation that 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.





The
      Company's current products include the following:





o
            Opacity
                monitor: Compliance & non-compliance
                types


o
            Extractive
                Continuous Emission Monitors


o
            Ammonia
                Analyzer


o
            Mercury
                Analyzer


o
            Insitu
                Process Analyzers





For
      the
      nine month period ended June 30, 2008, we generated revenues of $4,514,788
      which
      is an increase of $2,226,512 from the nine month period ended June 30, 2007.
      For
      the nine month period ended June 30, 2008, we generated net income of $313,800.
      For the nine month period ended June 30, 2007, we incurred a net loss of
      ($67,836). The following table summarizes these results:





Three
                Months Ended June 30,2008
            
            2007Revenues
            
            $
            1,272,314
            
            $
            1,636,171Operating
                Expenses
            
            $
            511,126
            
            
            805,683Net
                Income (Loss)
            
            $
            67,194
            
            
            ($
                297,805
            )Net
                Income Per Common Share, Basic and Diluted
            
            $
            0.000
            
            
            ($
                0.01
            )Weighted
                Average Number of Shares
            
            
            34,327,862
            
            
            24,044,144




Page
          14
          of 35




Nine
                Months Ended June 30,2008
            
            2007Revenues
            
            $
            4,514,788
            
            $
            2,288,276Operating
                Expenses
            
            $
            1,643,528
            
            $
            987,928Net
                Income (Loss)
            
            $
            313,800
            
            
            ($
                67,836
            )Net
                Income Per Common Share, Basic and Diluted
            
            $
            0.01
            
            
            ($
                0.00
            )Weighted
                Average Number of Shares
            
            
            34,327,862
            
            
            18,208,407Current
                Assets
            
            $
            1,293,168
            
            $
            1,180,972Total
                Assets
            
            $
            4,496,628
            
            $
            4,238,532Total
                Liabilities
            
            $
            2,702,342
            
            $
            2,758,046Total
                Stockholders' Equity
            
            $
            1,794,286
            
            $
            1,480,486




On
      April
      27, 1998, the Company was incorporated in the state of Delaware under the name
      “Diversified American Holdings, Inc.” On November 13, 1998, the Company’s name
      was changed to “Strateginet, Inc.” The Company subsequently changed its name to
“Cemtrex Inc.” on December 16, 2004.





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 Texxar Inc. a private corporation. The sole owner of Texxar,
      Inc. is 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. 3,250,000 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.




Page
          15
          of 35




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. The Company’s 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 getting 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.




**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 the Company’s emission monitoring equipment and environmental control
      systems.





These
      governmental regulations affect nearly every industrial activity. The principal
      federal legislation that was created is the Clean Air Act of 1970, as amended
      (the “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.




Page
          16
          of 35




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 (CO 2 ),
      methane (CH 4 ),
      and
      nitrous oxide (NO x ).
      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 NO x Trading Programs ,
      which
      reduce emissions of sulfur dioxide (SO 2 )
      and
      nitrogen oxides (NO x )–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
      (SO 2 )
      and
      nitrogen oxides (NO x ),
      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 SO 2 and NO x resulting
      from fossil fuel combustion. In the United States, roughly 2/3 of all
      SO 2 and 1/4
      of all NO x 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.




**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) NO x Budget Program was
      implemented from 1999 to 2002 and was replaced by the NO x Budget Trading Program —also
      known as the “NO x SIP
      Call”—in 2003. The NO x SIP
      Call Program
      is a market-based cap and trade program created to reduce emissions of nitrogen
      oxides (NO x )
      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
      NO x Budget
      Trading Program was designed to reduce NO x 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 (SO 2 )
      and
      nitrogen oxides (NO x )—by
      70
      percent.




Page
          17
          of 35




The
      goal
      of the Clean Air Interstate Rule (CAIR) is to permanently cap emissions of
      SO 2 and
      NO x 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 (SO 2 )
      and
      nitrogen oxides (NO x )
      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 SO 2 ,
      NO x mercury
      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.




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 SO 2 ,
      volumetric flow, NO x ,
      diluent
      gas, and opacity for units regulated under the Acid Rain Program. In addition,
      procedures for monitoring or estimating carbon dioxide (CO 2 )
      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 SO 2 emissions in a cost-effective manner. (One allowance is an authorization to
      emit
      1 ton of SO 2 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.




Page
          18
          of 35




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
                SO2pollutant concentration monitor.




·
            A
                NOxpollutant concentration monitor.




·
            A
                volumetric flow monitor.




·
            An
                opacity monitor.




·
            A
                diluent gas (O2or
                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 SO2mass 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 SO2mass 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.
            SO2and flow CEMs.




·
            Gas-fired
                and oil-fired base-loaded units must use NOxCEMs.




·
            Gas-fired
                peaking units and oil-fired peaking units may either estimate
                NOxemissions by using site-specific emission correlations and periodic
                stack
                testing to verify continued representativeness of the correlations,
                or use
                NOxCEMS. The emission correlation method has been significantly streamlined
                in the revised rule.




Page
          19
          of 35




·
            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
                CO2all units can use either (1) a mass balance estimation, or (2)
                CO2CEMs, or (3) O2CEMs in order to estimate CO2emissions.




**PRODUCTS**





The
      Company 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
      Company'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-extractive and dilution-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 belive 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
      availability. SM4 uses straight extractive Teflon sheathed Hastelloy probe
      with
      no plugging or corrosion.




Page
          20
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**PRODUCT
      DEVELOPMENT**





There
      are
      no products under development at the present time.





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 provides 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.





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 it 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.




Page
          21
          of 35




**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.





**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. 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.




Page
          22
          of 35




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 believes 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.





**EMPLOYEES**





The
      Company employs 21 full time and three part time employees, consisting of one
      executive officer, five managers, ten 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.




Page
          23
          of 35




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 $ 4,225.00 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 .





**RISK
      FACTORS**





An
      Investment in our common stock involves risks. You should carefully consider
      the
      following risks, as well as the other information contained in this quarterly
      report. If any of the following risks actually occur, our business could be
      materially harmed.





**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.





*o* If
      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.





*o* We
      have
      incurred losses for the fiscal year ending September 30, 2007, and we may incur
      losses for the foreseeable future.




We
      had
      net loss of $123,565 for the fiscal year ended September 30, 2007. These losses
      have resulted principally from expenses incurred in the extensive demonstration
      testing of its new SM4 compliance mercury monitors at various utility sites
      and
      the low gross margin product line of Griffin Filters. We may 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 nine months ended
      June 30, 2008, we generated a net profit of $67,194. 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 achieve profitability, we will need
      to
      generate significant additional revenues with significantly improved gross
      margins. It is uncertain when, if ever, we will return to profitability. Even
      if
      we were to become profitable, we might not be able to sustain or increase
      profitability on a quarterly or annual basis.




Page
          24
          of 35




*o* The
      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.





*o* The 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.




Page
          25
          of 35




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.





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 andenforcement 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.




Page
          26
          of 35




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.





o
      A
      demand for payment of the outstanding loan or the conversion into non-assessable
      share of common stock of the Company may have an adverse effect on the Company.





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 carries
      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 is
      due
      and payable on April 30, 2011.





The
      debenture has 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 was
      not
      exercisable prior to December 31, 2007. Commencing December 31, 2007 and
      continuing to April 30, 2011, the Debenture Holder shall have the right of
      conversion subject o the terms and conditions of the debenture. In the event
      the
      face amount of the debenture is not fully converted on or before April 30,
      2011,
      the conversion rights will lapse.





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 fiscal year 2008, 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. 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 diluted.





o
      Our
      stock trades on the Pink Sheets electronic quotation system.





The
      Company’s Common Stock currently trades on the Pink Sheets electronic quotation
      system under the symbol “CTEI.PK”. The Pink Sheets 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. *See* Risk
      Factor “Our stock price may be highly volatile” below.




Page
          27
          of 35




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.




Page
          28
          of 35




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.





In
      addition, potential dilutive effects of future sales of shares of common stock
      by shareholders **** and
      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
      74% of our outstanding voting capital stock is beneficially held by Arun Govil
      the Company’s Chairman, Chief Executive Officer, President and Treasurer. In
      addition, Mr. Govil holds a promissory note that may be convertible into
      30,000,000 shares of common stock of the Company at his option. 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 could make it impossible
      for the public stockholders to influence the affairs of the Company.





**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 this
“Management’s Discussion and Analysis of Financial Condition and Results of
      Operations” section hereof.




Three Months Ended June 30,2008
            
            2007Revenues
            
            $
            1,272,314
            
            $
            1,636,171Operating
                Expenses
            
            $
            511,126
            
            
            805,683Net
                Income (Loss)
            
            $
            67,194
            
            
            ($
                297,805
            )Net
                Income Per Common Share, Basic and Diluted
            
            $
            0.000
            
            
            ($
                0.01
            )Weighted
                Average Number of Shares
            
            
            34,327,862
            
            
            24,044,144




Page
          29
          of 35




Nine Months Ended June 30,2008
            
            2007Revenues
            
            $
            4,514,788
            
            $
            2,288,276Operating
                Expenses
            
            $
            1,643,528
            
            $
            987,928Net
                Income (Loss)
            
            $
            313,800
            
            
            ($
                67,836
            )Net
                Income Per Common Share, Basic and Diluted
            
            $
            0.01
            
            
            ($
                0.00
            )Weighted
                Average Number of Shares
            
            
            34,327,862
            
            
            18,208,407Current
                Assets
            
            $
            1,293,168
            
            $
            1,180,972Total
                Assets
            
            $
            4,496,628
            
            $
            4,238,532Total
                Liabilities
            
            $
            2,702,342
            
            $
            2,758,046Total
                Stockholders' Equity
            
            $
            1,794,286
            
            $
            1,480,486




**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.




Page
          30 of
          35




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.




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 nine months ended June 30, 2008 increased by $2,226,512or
        97.3%,
        to $4,514,788, from $2,288,276 for the nine months ended June 30, 2007. Sales
        growth increased during the period primarily due to _consolidation of griffin
        Filters’s nine month’s sales. The overall market demand for our existing
        business increased during the last year. However, Net sales for three months
        period ended June 30, 2008 decreased 22.2% to $1,272,314, as compared to
        the
        similar period ended June 30, 2007. This decrease was primarily due to timing
        of
        certain order shipments.
  *Gross
          Profit* :
          Gross
          profit for the nine months ended June 30, 2008 increased $ 1,183,702 or
          132%,
          to $2,079,858 which made up 46.1% of net sales, from $896,156 for the nine
          months ended June 30, 2007, which made up 39.1% of net sales. The higher
          gross
          margin in the nine months ended June 30, 2007 was a direct result of the
          product
          mix during the period. Gross profit for three months period ended June
          30, 2008
          decreased $480,894 or 42.1% to $662,585, which made up 52.1% of net sales
          from
          $1,143,479 for the three month period ended June 30, 2007, which made up
          69.9%
          of net sales. The decrease of gross profit was a direct result of the type
          of
          projects completed during this period.
  *Operating
          Expenses:* Operating
          expenses for the nine months ended June 30, 2008 increased $655,600, or
          66.3%,
          to $1,643,528 from $987,928 for the nine month period ended June 30, 2007.
          Operating expenses as a percentage of sales decreased in the nine month
          period
          ended June 30, 2008 to 36.4% from 43.2% in the nine month period ended
          June 30,
          2007. The decrease in operating expenses percentage was primarily due to
          higher
          sales level during the nine month period as compared to last year. Operating
          expenses for the three months ended June 30, 2008 decreased $294,557, or
          36.6%,
          to $511,126 from $805,683 for the three month period ended June 30, 2007.
          Operating expenses as a percentage of sales decreased in the three month
          period
          ended June 30, 2008 to 40.9% from 49.2% in the three month period ended
          June 30,
          2007. The decrease in operating expenses was primarily due to lower marketing
          and overhead expenses due to lower activity level.
  *Net
          Income/Loss:* The
          Company had net income of $313,800 for the nine month period ended June
          30, 2008
          as compared to a net loss of ($67,836) for the nine month period ended
          June 30,
          2007. The net profit in the nine month period ended June 30, 2008 was a
          result
          of higher sales during this period. The Company had a net profit of $67,194
          for
          three months period ended June 30, 2008 as compared to a net loss of ($297,805)
          in the similar period ended June 30, 2007. The higher net income for the
          three
          month period ended June 30, 2008 was a result of profitable operations
          during
          this quarter as compared to a net loss incurred by Griffin Filters during
          the
          same period last year.
 *Provision
          for Income Taxes:* Our
          effective state and federal tax rate, adjusted for the effect of certain
          credits
          and adjustments, was approximately 38% and 38% for 2007 and 2006, respectively.
 ****
 **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.
  Page
            31 of
            35
  **LIQUIDITY
        AND CAPITAL RESOURCES**
  Working
        capital was ($109,174) at June 30, 2008, compared to ($277,074) at September
        30,
        2007. This included cash and cash equivalents of $218,661 at June 30, 2008
        and
        $143,830 at September 30, 2007, respectively. The reason for the improvement
        in
        working capital was due to higher sales and profitability of operations.
        At June
        30, 2008, we had $218,661 in cash as compared with $164,162 in cash at June
        30,
        2007.
  Trade
        receivables decreased $ 80,128 ,
        or
        10.3% at June 30, 2008 to $700,346 at June 30, 2008 from $780,474 at September
        30, 2007. The decrease in accounts receivable is attributable to timing of
        order
        shipments and receipt of payments from customers.
 Inventories
        increased $ 121,718 or
        67.5%
        to $374,161 at June 30, 2008 from $252,443 at September 30, 2007. The increase
        inventory was due to timing of order shipment and receipt of fresh inventories.
  Continuing
        operations used $312,958 of cash for the nine months ended June 30, 2008,
        compared to generating $472,332 of cash for the nine months ended June 30,
        2007.
        The decrease in cash flows was primarily related to payments of account payable
        and collection of account receivables timing. . Investing activities for
        continuing operations used $151,939 of cash during the nine months ended
        June
        30, 2008, compared to $715,949 of cash during the nine months ended June
        30,
        2007. The use of cash by investing activities was primarily attributable
        to the
        purchase of griffin last year and to purchase of equipment during this year.
        The
        financing activities during the nine months ended June 30, 2008 generated
        $539,728 in cash from issuance of loans from shareholders.
  We
        believe that our cash on hand, cash generated by operations, is sufficient
        to
        meet the capital demands of our current operations during the 2008 fiscal
        year.
        Any major increases in sales, particularly in new products, may require
        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.




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 “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•
            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 10QSB
      will
      in fact occur.




ITEM
      3.
      CONTROLS AND PROCEDURES.





The
      Company's Chief Executive Officer and chief financial and accounting officer
      (the "Certifying Officer") is responsible for establishing and maintaining
      disclosure controls and procedures for the Company. The Certifying Officer
      has
      concluded (based upon his evaluation of these controls and procedures as of
      JUNE
      30, 2008) that the Company's disclosure controls and procedures are effective
      to
      ensure that information required to be disclosed by the Company in this report
      is accumulated and communicated to the Company's management, including its
      principal executive officers as appropriate, to allow timely decisions regarding
      required disclosure. The Certifying Officer also has indicated that there were
      no changes in the Company's internal controls or other factors that could
      materially affect such controls subsequent to the date of his evaluation, and
      that there were no corrective actions necessary with regard to any deficiencies
      or material weaknesses.




Page
          32 of
          35




ITEM
      3A(T). CONTROLS AND PROCEDURES.





MANAGEMENT'S
      INTERNAL CONTROL OVER FINANCIAL REPORTING





The
      Company's internal control over financial reporting disclosure, financial
      controls, and reporting procedures are designed to ensure that information
      required to be disclosed in our reports and filed or submitted under the
      Securities Exchange Act of 1934 (the "Exchange Act") is accurately recorded,
      processed, summarized, and reported, according to the rules and regulations
      and
      within the time periods proscribed by the Exchange Act. The Company believes
      that its internal controls and procedures relating to its financial reporting
      are designed to provide reasonable assurance of achieving the Company's goals
      of
      compliance with the Exchange Act. However, the design of any system of financial
      control is based upon certain assumptions about the likelihood of future events
      and is affected by the amount of resources available to a company and inherent
      risks within any control procedure. There can be no assurance that any design
      will succeed in achieving its stated objectives under all future events, no
      matter how remote, or that the degree of compliance with the policies or
      procedures may not deteriorate. Because of the inherent limitations in financial
      disclosure, controls, and procedures, the Company may not be able to prevent
      or
      detect all misstatements or failures to comply with the Exchange
      Act.





Accordingly,
      even effective disclosure controls and procedures can only provide reasonable
      assurance of achieving their control objectives.





The
      Company's internal control over financial reporting disclosure, financial
      controls, and reporting procedures are designed by, or under the supervision
      of,
      the Company's Certifying Officer. The Company's Certifying Officer, the board
      of
      directors, management, and other personnel, are involved in implementing the
      Company's internal control over financial reporting disclosure, financial
      controls, and reporting procedures in an effort to provide reasonable assurance
      regarding the reliability of financial reporting, the preparation of financial
      statements, and the structural flexibility required to effectuate such
      procedures.





The
      Company's internal control over financial reporting disclosure, financial
      controls, and reporting procedures are consistent with generally accepted
      accounting principles, and includes those policies and procedures
      that:





(1)
            pertain
                to the maintenance of records in reasonable detail and accurately
                and
                fairly reflect the transactions and dispositions of the assets of
                the
                Company;





(2)
            provide
                reasonable assurance that transactions are recorded as necessary
                to permit
                preparation of financial statements in accordance with generally
                accepted
                accounting principles, and that receipts and expenditures of the
                Company
                are being made only with the authorization of the management and
                directors
                of the Company; and





(3)
            provide
                reasonable assurance regarding prevention or timely detection of
                unauthorized acquisition, use, or disposition of the Company's assets,
                or
                unauthorized transactions, that could have a material effect on the
                Company's financial statements.





The
      Certifying Officer is aware of no changes in the Company's financial reporting
      disclosure, financial controls, or reporting procedures during the quarter
      ended
      June 30, 2008, that could materially affect the Company's ability to comply
      with
      the Exchange Act. The Certifying Officer is aware of no instances during the
      quarter ended June 30, 2008, whereby the Company's internal control over
      financial reporting disclosure, financial controls, and reporting procedures
      revealed any deficiency or material weakness requiring corrective action by
      the
      Company.





PART
      II-
      OTHER INFORMATION





ITEM
      1.
      LEGAL PROCEEDINGS.





The
      Company is not a party to any pending legal proceeding. Management is not aware
      of any threatened litigation, claims or assessments.




Page
          33
          of 35




ITEM
      2.
      UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.





None.





ITEM
      3.
      DEFAULTS UPON SENIOR SECURITIES





None.





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





None.





ITEM
      5.
      OTHER INFORMATION





ITEM
      6.
      EXHIBITS




Page
          34
          of 35




**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:  August
                14, 2008
            By
            /s/Arun
                GovilChairman
                of the Board, ChiefExecutive
                Officer and PresidentDated:  August
                14, 2008
            By
            /s/Renato
                Dela RamaVice
                President of Finance





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          35
          of 35