SecProbe.io

Mail Stop 3561

June 18, 2007

Via U.S. Mail

Jason Reid
President and Chief Executive Officer
164 West, 25th Street, 6th Floor
New York 10001

Re:  Coda Octopus Group, Inc.
 Registration Statement on Form SB-2
 Filed May 22, 2007
 File No. 333-143144

Dear Mr. Reid,

We have reviewed your filing and have the following comments.  Where indicated,
we think you should revise your document in re sponse to these comments.  If you disagree,
we will consider your explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as deta iled as necessary in your expl anation.  In some of our
comments, we may ask you to provide us with  supplemental information so we may better
understand your disclosure.  After reviewing th is information, we may or may not raise
additional comments.

The purpose of our review process is to assist you in your compliance with the
applicable disclosure requirements and to enha nce the overall disclosure in your filing.  We
look forward to working with you in these respects and welcome any questions you may have about our comments or on any other aspect of our review.  Feel free to call us at the
telephone numbers listed at the end of th is letter.

Prospectus Cover Page

1. Please highlight the risk factors cr oss-reference by prominent type.

Outside Back Cover Page of Prospectus
2. Please include the dealer prospectus de livery obligation language required by Item
502(b) of Regulation S-B.

Jason Reid
Coda Octopus Group, Inc.
June 18, 2007 Page 2

Prospectus Summary, page 1

3. Revise the first sentence under General to  make “are expected” active voice so
investors can judge who expect s the development you discuss.

4. Revise the first bullet on page 1 to disclose your $2.5 million loss on $2.7 revenues
for the first quarter of ’07 so investors can  have a context to u nderstand the rest of
the bullet.
5. You state that you believe that you have th e ability to capitalize on the opportunity
as a result of “first mover advantage in  3-D sonar markets.”  Please provide the
basis for the claim.  In this regard, we not e the first risk factor on page 6 discusses
that there are competitor with substan tial longer operating histories and greater
name recognition.
6. Please expand this section to disclose the amount of your net loss for the most
recent audited and interim periods.  Add itionally, disclose the amount of your
working capital and the amount of your accu mulated deficit.  We believe this
financial snapshot will provide a useful context to help investors interpret the rest of the summary.

Acquisitions, page 2

7. Revise the first paragraph for clarity.  Is the $286,000 in common stock part of the
purchase price you might be obligated to pay?

Risk Factors, page 3
8. Please delete the fourth sentence of  the opening paragraph.  If you know of
additional material risks, please identify them.
9. We note your discussion regarding increased reliance on sales to government agencies.  Please disclose whether any of your key customers account for 10% or
more of your revenues for the last fiscal year and if so, please name them and give
the percentage.

We have incurred significan t losses to date, page 3

10. Include your stub period losses here.

Management’s Discussion and Analysis  or Plan of Operation, page 9
General

11. Please explain what you mean by “disruptive technology qualities.”

Jason Reid
Coda Octopus Group, Inc.
June 18, 2007 Page 3

Results of Operations, page 11

12. We generally believe that your discussion of financial results between periods can
be further enhanced with th e presentation of a table s howing summarized financial
results for the periods under consideration.  We believe that this type of
presentation provides the reader further clarification.  As such, consideration
should be given to adding a table that would provide a comparison of financial
results between periods.  Please refer to S ection III.A. (Present ation of MD&A) in
FRR-72 (Release No. 33-8350).

13. In the Employment Agreements section, st arting on page 31, we noted that several
of your key employees were granted si gnificant salary increases effective
November 1, 2006.  As these increases will represent a material change in your
selling, general and administrative expenses  in future periods, please discuss these
changes as items that will have an effect on future operations.

Liquidity and Capital Resources, page 12

14. If you have a plan to reduce your losses or  become profitable, we encourage you to
discuss it here.

Inflation and Foreign Currency, page 13

15. It appears that a significa nt amount of your business is transacted in foreign
currency, mainly the pound sterling and the Norwegian kroner.  Please revise your
foreign currency disclosure to include the approximate amount of your business
that is impacted by changes in foreign cu rrency as well as a sensitivity analysis for
changes (e.g. 10%) that may occur betw een the U.S. dollar and the foreign
currencies.

Financing Activities, page 14

16. Based upon your statement of stockholders ’ equity on page F-4, it appears that
some of the Series A Preferred Stock wa s issued in exchange for debt, and not
solely for cash consideration.  Please revise  your disclosure so th at it is consistent
with information presented in your fi nancial statements and throughout the
document.

Business, page 15

17. Please revise the disclosure to include a discussion of the information required by
Items 101(b)(5), (6), (8), and (9).

Jason Reid
Coda Octopus Group, Inc.
June 18, 2007 Page 4

18. For each of the products you discuss, pleas e disclose the price or price range you
charge.

Outstanding Equity Awards and Director Compensation Tables, page 31

19. Please revise to fully comply with It ems 402(d) and (e) of Regulation S-B.

Security Ownership of Certain Beneficial Owners and Management, page 37

20. Please disclose the percentage of owne rship for Vision Opportunity.  We note
footnote 11 states that the percentage ownership for Vision Opportunity Master
Fund reflects a 9.9% ownership limitation provision.

21. Please identify the beneficial owner(s) fo r Vision Opportunity Master Fund.  We
refer you to Instruction 4 to Item 403 of Regulation S-B.

22. We note that there is a 4.9% ownership limitation with each of the beneficial
owners, but the limitation may be changed to 9.9%.  Please advise whether and
how you will update the beneficial ownership table.

Certain Relationships and Re lated Transactions, page 43

23. On May 10, 2007, the company repurchased 18,181 shares of Series B preferred
Stock from Vision at a purchase pric e of $110 per share for a total of $1,9,999,910.
Please disclose the approximate dollar valu e of the amount of the related party’s
interest in the tran saction.  See 404(a)(4) of Re gulation S-B.  Please revise
accordingly for all of the re lated party transactions di sclosed in this section.

Series B Preferred Stock, page 45

24. Your disclosure states that there is curre ntly no Series B Preferred Stock issued.
However, based on the information provide d on page 14 and in your statement of
stockholders’ equity, there appears to be  Series B Preferred Stock issued and
outstanding.  Please revise for consistency throughout the filing.

Consolidated Statements of Operations and Comprehensive Loss
For the Years Ended October 31, 2006 and 2005, page F-3

25. Please tell us what types of expenses are classified as “Non-recurring expenses”
within your operating expenses section.  If  the expenses classified as such are
expenses that are incurred within the normal operations of the business, please
modify the caption to “Other operating e xpenses” with appropriate note disclosure
of its components or label the caption with  the specific nature of these expenses.

Jason Reid
Coda Octopus Group, Inc.
June 18, 2007 Page 5

We believe this will provide enhanced understanding and detail to readers of your
financial statements.

Consolidated Statements of Cash Flows, pages F-5 and F-17

26. Reference is made to your fiscal 2006 a nd interim (January 2007) reconciliation of
operating activities cash flows that begins with the amount of “Net Loss Applicable
to Common Shares,” rather than the amount for “Net Loss.”  In accordance with
the guidance in paragraph 28 of SFAS 95, please begin with the amount of Net
Loss as reported in your cons olidated statement of operati ons in reconciling to net
cash (used) / generated by operating activit ies.   In this regard, the financing
activity section will include payments of cash dividends on preferred stock and gross proceeds on sale of equ ity securities with a benefi cial conversion feature.
Please revise the operating ac tivities section in the annual and interim Consolidated
Statements of Cash Flows, accordingly.

27. We note that your first and third paragra ph in the Supplemental Disclosures contain
statements that appear to be incomplete.  Please revise.

Note 1 – Significant Accounting Policies (S tock Based Compensa tion) – page F-8

28. We note your audit opinion states that you have adopted the provisions of SFAS
123(R) as of January 1, 2006.  However, your stock-based co mpensation footnote
references the guidelines of SFAS 1 23, and your accounting under SFAS 123(R) is
not evident.  Please revise to discu ss your implementation of SFAS 123(R), both
here and in the interim period footnotes.  In addition, please revise to include the
current year effect of the change on your financial statements due to the
implementation of SFAS 123(R), as well as  the disclosures required by paragraph
84 of SFAS 123(R).  Please al so revise the Critical Accounting Policies discussion
in MD&A (page 11), accordingly.

Note 2 – Fixed Assets, page F-9

29. Please revise to ensure that the informati on presented in the charts agrees with your
balance sheet as of October 31, 2005.  Add itionally, we note that the reconciliation
of Property and Equipment presented show s a change in accumulated depreciation
of ($246,141) from 2005 to 2006, while you disclose that you recorded depreciation expense of $52,396.  As such, please provide a rec onciliation of your
property and equipment, including accu mulated depreciation, from October 31,
2005 to October 31, 2006, showing all purch ases, disposals and other changes
(such as those resulting from acquisitions).

Jason Reid
Coda Octopus Group, Inc.
June 18, 2007 Page 6

Note 10 – Acquisition, page F-14

30. In the acquisition of Martech Systems (W eymouth) Limited, we note you allocated
approximately $1 million of the purchase price to goodwill with no other specific
identifiable intangible assets allocated a ny significant amount of purchase price.
From the Business section that describes this acquisition, we not e that Martech had
an extensive network of personal contact ba se established in the industry (page 17)
as well an established and gr owing revenue stream in the defense sector (page 21).
In addition, we note that your resear ch and development expenses have
significantly increased by 200% to $3.13 m illion in fiscal 2006 and production was
Martech’s most significant cost.   Therefor e, it is unclear w hy a significant amount
of the purchase price in the acquisition of Martech has not been allocated to
specific identifiable intangible assets, such  as customer-related or supplier-related
intangible assets, or research and deve lopment expense in accordance with the
guidance in Appendix A (paragraph A14.b)  and paragraph 42, respectively, of
SFAS 141 as well as FASB Interpretation N o. 4.    Please advise on your evaluation
of specific identifiable intangible assets and in-process research and development
expense for this acquisition and revise the financial statements, as necessary.

31. Furthermore, please revise the acquisition no te to disclose the primary reasons for
the Martech acquisition, including a descrip tion of the factors th at contributed to
the recognition of any significant amount  of goodwill in accordance with the
guidance in paragraph 51(b) of SFAS 141.

Notes to Consolidated Financial Statements as of January 31, 2007, page F-20

32. Per Item 310(b) of Regulation S-B, interim financial statements are required to include all adjustments which are necessary  to make the financial statements not
misleading, and must contain a statement affirming this.  This statement is generally included in the first note to the interim financial statements.  Please
ensure that all such adjustments have  been made and include the requisite
affirmative statement in the interim financial statements.

Independent Auditors’ Report – Martech Syst ems (Weymouth) Limited (“Martech’s”),
page F-33

33. The audit report of your independent a uditor, Coyne, Butterworth & Chalmers,
should cover both audited fiscal years (October 31, 2004 and 2005) included in the
audited financial statements and not  solely Martech’s most recent audited fiscal
year of October 31, 2005 presented in the filing.  As such, please revise the audit report to include in the firs t paragraph and the Opinion paragraph the audit of the
fiscal 2004 financial statements.

Jason Reid
Coda Octopus Group, Inc.
June 18, 2007 Page 7

34. Please revise the auditors’ report to al so include the Cash Flow Statement (see
Martech financial statements comment below) in the first paragraph as well as the
Opinion paragraph for each of the two years ended October 31, 2005 and 2004.  In addition, please revise the Opinion paragraph to opine on the balance sheet as of
October 31, 2005 and 2004.

35. Please revise the auditors’ report to include a statement that the audit was conducted in accordance with U.S. GAAS.   As Martech is a non-issuer entity
whose financial statements are filed to  satisfy the requirements of a business
acquired for Item 310(c) of Regulation S-B, the audit report only requires reference
to U.S. GAAS and not PCAOB standards.  In this regard, please revise paragraphs
3 and 4 (Respective responsibil ities of directors and audito rs) and 8 (Basis of audit
opinion), as applicable.  Refer to the guidance in Item 8.A.2 of Form 20-F or
Securities Act Release 33-7745.  Please revise accordingly.

36. In the third paragraph of the audit report, we note cer tain language where the
auditors’ clarify the parties to whom they owe a duty of care and avoiding
unintended liability to third parties who ma y seek to rely on their audit opinion.
Although this language may be permitted by UK law, the audit reports filed by
foreign private companies as contained in Commission filing s should not contain
similar clarifying language in accordance w ith U.S. GAAS or PCAOB standards,
as applicable.  Please revise the report so  that it contains an “unrestricted” audit
opinion without any clarifying language fo r purposes of U.S. reporting.  Please
refer to the guidance in the Office of Chief Accountant Letter dated February 28,
2003 on “The Use of Clarifying Language in  UK Audit Opinions”.  This letter can
be located on the SEC website ( www.sec.gov ) under Division / Offices (Office of
Chief Accountant) and then Sta ff Letters to Industry.

Martech Systems (Weymouth) Limited Fi nancial Statements, page F-34 and F-38

37. Please include an audited  Cash Flow Statement for each of the two years ended
October 31, 2005 and 2004.  The audited Cash Flow Statement should be opined upon in the auditors’ report as cited in the comment above.  In addition, please include unaudited interim Cash Flow Stat ements for the six months ended April 30,
2005 and the comparative six month period in  fiscal 2004.   Refer to the financial
statement guidance in Item 8.A.1.d. of Fo rm 20-F.  Please revise accordingly.

38. We note that Martech’s unaudited interim financial statements as of April 30, 2005
and 2004 do not contain any notes  to the financial statements.  In accordance with
the guidance in Item 8.A.5 of Form 20-F, please revise to include the applicable
note