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Auditor Report of 20 Microns Ltd.

Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of 20 Microns Limited (âthe Companyâ), which comprise the Balance Sheet as at 31^st March 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended and a summary of the significant accounting policies and other explanatory information (herein after referred to as âStandalone Ind AS Financial Statementsâ).

Managementâs Responsibility for the Standalone Ind AS Financial Statements

The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act read with relevant rules issued thereunder.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditorâs Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including Ind AS, of the state of affairs (financial position) of the Company as at 31^st March 2018, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Other matters

The Comparative financial information of the Company for the year ended 31^st March 2017 and the transition date opening balance sheet as at 1^st April 2016 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditor whose report for the year ended 31^st March 2017 and 31^st March 2016 dated 25^th May 2017 and 23^rd May 2016 respectively expressed an unmodified opinion on those standalone financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by us.

Our Opinion is not modified in respect of these matters. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of section 143 (11) of the Act, we give in the âAnnexure - Aâ, a statement on the matters specified in the paragraph 3 and 4 of the order, to the extent applicable.

2. As required by Section 143 (3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account as required

by law have been kept by the Company so far as it appears from our examination of those books.

c) The Balance Sheet, the Statement of Profit and Loss, the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act.

e) On the basis of written representation received from the directors as on 31^st March, 2018 and taken on record by the Board of Directors, none of the directors is disqualified as on 31^st March, 2018 from being appointed as a director in terms of the subsection (2) of section 164 of the Companies Act, 2013.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure - Bâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.

g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements. Refer Note 41 to the standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

(Referred to in paragraph 1 under âReport on Other Legal and Regulatory Requirementsâ section of our Independent Auditorâs Report, of even date, to the members of 20 Microns Limited on Standalone Ind AS Financial Statements for the year ended 31^st March 2018)

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company as at 31^st March 2018.

(ii) The inventory, has been physically verified by the Management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liabilities Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3 (iii) [(a) to (c)] of the said Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.

(v) In respect of deposits accepted by the Company, the Company has complied with the directives of Reserve Bank of India and provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed thereunder.

(vi) We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under sub-section (1) of Section 148 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, income tax, sales tax, goods and service tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited with the appropriate authorities though there has been slight delay in few cases. According to the information and explanations given to us and the records of the Company examined by us, in our opinion, no undisputed amounts payable were in arrears as at 31^st March 2018 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of sales tax, GST, service tax, duty of excise and customs duty which have not been deposited on account of any dispute.The particulars of dues of income tax as at 31^st March 2018 which have not been deposited on account of a dispute, are as follows:

Name of statute	Nature of dues	Amount (in Lakhs)	Period to which the amount relates	Forum where the dispute is pending
Income Tax Act. 1961	Income Tax	5.96	Assessment Year 2009-10	Commissioner of Income Tax, Appeals
Income Tax Act. 1961	Income Tax	44.53	Assessment Year 2016-17	Central Processing Centre Bengaluru
		50.49

(viii) The Company has not defaulted in repayment of loans or borrowing dues to financial institution or bank or dues to debenture holders.

(ix) The Company did not raise any money by way of initial public offer, further public offer (including debt instruments) or term loans during the year.

(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been, noticed or reported during the year, nor we have been informed of any such case by the Management.

(xi) In our opinion and according to the information and explanations given to us, the Company has paid or provided managerial remuneration during the year in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Companies Act, 2013. Details of such transactions have been disclosed in the financial statements as required by the applicable Indian Accounting Standards.

(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with them. Accordingly, paragraph 3(xv) of the Order is not applicable.

(xvi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

(Referred to in paragraph 2 (f) under âReport on Other Legal and Regulatory Requirementsâ section of our Independent Auditorâs Report, of even date, to the members of 20 Microns Limited on Standalone Ind AS Financial Statements for the year ended 31^st March 2018) Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)

We have audited the internal financial controls over financial reporting of 20 MICRONS LIMITED (âthe Companyâ), as of 31^st March, 2018 in conjunction with our audit of the standalone Ind As financial statements of the Company for the year ended on that date.

Managementâs Responsibility for Internal Financial Controls

The Companyâs management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (âICAIâ). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditorâs Responsibility

Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that

(1) pertain to the maintenance of records that, in reasonable detail, 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 in accordance with authorizations of management and directors of the company; and

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

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31^st March 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For, J. H. Mehta & Co.

Chartered Accountants

ICAI Firm Regn. No. 106227W

(Naitik J Mehta)

Place : Ahmedabad Partner

Date : 24/05/2018 Membership No. 130010

Mar 31, 2016

The Members of 20 Microns Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of 20 Microns Limited (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended on that date and a summary of the significant accounting policies and other explanatory information.

Managementâs Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule

7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditorâs Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2016, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We refer to note no. 4(e) to the standalone financial statements, regarding classification of Company''s Term Loan and Cash Credit Facilities with State Bank of India as Nonperforming Assets by the said bank with effect from 01/04/ 2014 for the reasons stated in the said note to which company has objected.

Our opinion is not modified in respect of this matter. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the âAnnexure Aâ a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors as on 31st March, 2016 and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure Bâ; and

(g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us :

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 27 to the financial statements;

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

(Referred to in paragraph 1 under âReport on Other Legal and Regulatory Requirementsâ section of our report on Standalone Financial Statements of 20 Microns Limited of even date)

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.

(ii) Physical verification of inventory has been conducted at reasonable intervals by the management and no material discrepancies were noticed.

(v) In respect of deposits accepted by the Company the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed thereunder, where applicable, have been complied with;

During the year Company Law Board, Mumbai Bench, has passed an order granting extension of time limit for repayment of deposits accepted by the company prior to commencement of the Act, upto the time as agreed with the fixed deposits holders. As per the order, no compliance is required to be made by the Company.

(vii) (a) According to the information and explanations

given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, with appropriate authorities except Income Tax Deducted at source, Sales Tax, Excise, Service Tax, Provident Fund and ESIC where there was some delay on few occasions at some of the offices of the company.

According to the information and explanations given to us and the records of the Company examined by us, in our opinion, no undisputed amounts payable were in arrears as at March 31, 2016 for a period of more than six months from the date they became payable.

(viii)The Company has not defaulted in repayment of loans or borrowing dues to financial institution or bank or dues to debenture holders.

(b) According to the information and explanations given to us and the records of the Company examined by us, the details of disputed statutory dues that have not been deposited on account of dispute are as under.

Sr. No.	Name of Statute	Nature of dues	Amount (In Lacs '')	Period to which the amount relates	Forum where dispute is pending
1.	Central Sales Tax, 1956	Central Sales Tax	10.76	Financial Year 2011-12	Commissioner of Commercial Taxes, Appeals
2.	Income Tax Act, 1961	Income tax	5.96	Assessment year 2009-10	Commissioner of Income Tax
3.	Income Tax Act, 1961	Income tax	1.04	Assessment year 2011-12	Income Tax Appellate Tribunal

(ix) The Company did not raise any money by way of initial public offer, further public offer (including debt instruments) or term loan during the year.

(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been, noticed or reported during the year, nor have we been informed of any such case by the Management.

(xi) According to information and explanation provided to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provision of Section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

(xiv) The Company has made private placement of shares during the year. The requirement of section 42 of the Companies Act, 2013 have been complied with. The amount raised have been used for the purpose for which it was raised.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

(Referred to in paragraph 2 (f) under âReport on Other Legal and Regulatory Requirementsâ section of our report on Standalone Financial Statements of 20 Microns Limited of even date)

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)

We have audited the internal financial controls over financial reporting of 20 Microns Limited (âthe Companyâ), as of 31 March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Managementâs Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (âICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditorâs Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, 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 in accordance with authorizations of 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 that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For Manubhai & Shah LLP

Chartered Accountants

ICAI Firm Regn. No. 106041W/W100136

(G. R. Parmar)

Place: Waghodia, Vadodara Partner

Date: 23rd May, 2016 Membership No.121462

Mar 31, 2015

We have audited the accompanying standalone financial statements of 20 MICRONS LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended on that date and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to:

a) Note 4(e) to the financial statements regarding restructuring/re-schedulement of loans by lenders.

b) Note 42 to the financial statements, regarding action taken by the company for repayment of deposits accepted prior to commencement of the Act and its classification in to Current and Non- Current Category for the reasons stated in the said note.

Our Opinion is not modified in respect of above matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given tous :

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 28 to the financial statements;

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

(iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE TO INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 1 under "Report on Other

Legal and Regulatory Requirements" section of our report on Standalone Financial Statement of 20 Microns Limited of even date)

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.

(b) As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification designed to cover all the fixed assets on rotation basis, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company.

(ii) (a) As explained to us, inventories have been physically verified by the management at regular intervals during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on verification between physical stocks and book records were not material.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3 (iii) [(a) and (b)] of the said Order are not applicable to the Company.

(iv) In our opinion, and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) In respect of deposits accepted prior to commencement of the act i.e. 01.04.2014, as per Section 74(1) of the Act, the Company is required to make repayment of deposit accepted prior to 31.03.2014 within a period of one year from 01.04.2014 or the date on which deposit becomes due for payment, whichever is earlier. The Company has repaid the deposits which have matured during the year 2014-15. However, in respect of deposits maturing after 31.03.2015, the Company has made an application dated March 29, 2015 under Section 74 (2) of the Companies Act, 2013, before the Company Law Board, Western Region Bench, Mumbai to allow the Company to re-pay the deposits up to and inclusive of the time as agreed with the fixed deposit holders.

In respect of deposits accepted after commencement of the Act i.e. 01.04.2014 from members, the Company has complied with provisions of Section 73 of Companies Act, 2013.

According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.

(vi) We have broadly reviewed the books of account maintained by the Company in respect of mineral products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under sub- section (1) of Section 148 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations

given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, with appropriate authorities except Income Tax Deducted at source, Sales Tax, Service Tax, Provident Fund and ESIC where there was some delay on few occasions at some of the offices of the company.

According to the information and explanations given to us and the records of the Company examined by us, in our opinion, no undisputed amounts payable as applicable were in arrears as at March 31, 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, the details of disputed

statutory dues that have not been deposited on account of dispute are as under.

Sr. Name of Statute Nature of Amount No. dues (In Lacs Rs.)

1. Central Excise Act, Excise Duty 749.67 1944

2. Central Excise Act, Excise Duty 2.00 1944

3. Central Excise Act, Custom Duty 1.50 1944

4. Income Tax Act, Income tax 5.96 1961

5. Income Tax Act, Income tax 32.76 1961

6. Central Sales Tax, Central Sales 9.43 1956 Tax

Sr. Name of Statute Period to which the Forum where No. amount relates dispute is pending

1. Central Excise Act, Financial Year Supreme Court 1944 07.02.2000 to 31.07.2003

2. Central Excise Act, Financial Year Customs, Excise 1944 1999-2000 and Service Tax Appellate Tribunal

Financial Year Customs, Excise 3. Central Excise Act, 2006-2007 and Service Tax 1944 Appellate Tribunal

Assessment Commissioner of Year 2009-2010 Income Tax 4. Income Tax Act, 1961 Assessment Commissioner of Year 2011-2012 Income Tax 5. Income Tax Act, 1961 Financial Year Commissioner of 2008-2009 Commercial 6. Central Sales Tax, Taxes, Appeals 1956

(c) The Company is not required to transfer any amount to Investor Education and Protection Fund in accordance with the provisions of the Companies Act, 1 956 and rules made thereunder.

(viii) The Company has no accumulated losses as at the end of the year ended March 31, 2015 and it has not incurred any cash losses in the year ended on that date or in the immediately preceding year ended on March 31, 2014.

(ix) In our opinion and according to the information and explanations given to us, during the year there have been defaults in repayment of instalments and Interest on Term Loans from the Banks. However in this regards Company had made an application for re-schedulement which was approved by the banks by way of Restructuring Package as mentioned in Note no. 4(e) to the Financial Statements. As per the terms of restructuring package the repayment of dues will commence from April 2016. Hence at the year- end there was no default in terms of restructuring package.

(x) According to the information and explanations given to us, the Company has given guarantee of Rs. 1,225 Lacs for loans taken by Subsidiary Company. The terms of such guarantee are not prejudicial to the interest of the Company.

(xi) The Term Loans were applied for the purpose for which the loans were obtained.

(xii) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the period, nor have we been informed of any such case by the Management.

For Manubhai & Shah Chartered Accountants Firm Registration No. 106041W

(G R Parmar) Place : Ahmedabad Partner Date : May 27, 2015 Membership No.121462

Mar 31, 2014

We have audited the accompanying financial statements of 20 Microns Limited ("the Company"), which comprise the Balance Sheet as at March 31,2014, the Statement of Profit and Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

b) in the case of Statement of Profit and Loss, of the Profit for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note 42 to the financial statements which describes managements view on repayment of deposits accepted prior to 31.03.2014. Consequently its classification in to Current and Non Current Category is made considering the period within which deposit will be repaid for the reason stated in the said note. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A)of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection(3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Company Affairs in respect of section 133 of the Companies Act, 2013.

e) on the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO

INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory Requirements'' section of our report of even date)

1. a. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets except tagging details of fixed assets is in the process of updation in the fixed assets register.

b. As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification designed to cover all the fixed assets on rotation basis, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company.

c. The fixed assets disposed of during the year, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2 a. As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the Company and the nature of its business.

c. The company has maintained proper records of inventories. As explained to us, the discrepancies noticed on verification between physical stocks and book records were material and the same have been properly dealt with in the books of account.

3 a. The Company has granted unsecured loan to one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding at any time during the year was Rs. 10.28 Lacs and the year- end balance was Rs. Nil.

b. In our opinion and according to information and explanation given to us, the loans are interest free and other terms and conditions are not prima facie prejudicial to the interest of the Company.

c. The loans given by the Company are interest free and repayable at the end of one year in single installment and on demand therefore the question of regular receipt of principal amount and interest does not arise.

d. The Company has taken unsecured loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding at any time during the year was Rs. 185.38 Lacs and the year- end balance was Rs. Nil.

e. In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of these loans are not prima facie prejudicial to the interest of the Company.

f. In respect of loans taken by the company, the interest and the principal amount are repayable on demand.

g. The loans taken/granted by the Company are repayable on demand and therefore question of overdue amount does not arise.

4. In our opinion, and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

5 a. According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. Having regard to the nature of transaction and non availability of comparable quotations, the reasonability of price in respect of the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year cannot be ascertained.

6. In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public.

Further, we are informed that no Order has been passed by the Company Law Board (''the CLB'') or National Company Law Tribunal (''the NCLT'') or Reserve Bank of India (''the RBI'') or any Court or any other Tribunal.

7. The Company has appointed firms of chartered accountants as internal auditors. On the basis of reports submitted by internal auditors, in our opinion the internal audit system is commensurate with the size and nature of company''s business.

8. The Central Government has prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9. a. In our opinion and according to the information and explanation given to us, the company has been regular in depositing undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Investor Education and Protection Fund, Custom duty, Professional tax and other statutory dues as may be applicable to the company except in case of Income Tax deducted at Source, Excise duty, Sales Tax, Service Tax and Employees'' State Insurance dues where there was some delay on few occasions at some of the offices of the company.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, custom duty and excise duty were in arrears, as at 31st March, 2014 for a period of more than six months from the date they become payable.

c. The details of disputed statutory dues that have not been deposited on account of dispute are as under:

Sr. Name of Statute Nature of Amount Period to which No dues (In Lacs Rs.) the amount relates 1. Income Tax Act, 1961 Income 20.14 (Adjusted 2005-2006 Tax Against refund due by Income Tax Department)

2. Income Tax Act, 1961 Income Tax 48.78 2011-2012

3. Central Sales Central Sales 9.43 2008-2009 Tax Act, 1956 Tax

4. Central Excise Custom Duty 2.77 2006-2007 Act, 1944

5. Central Excise Custom Duty 3.00 1999-2000 Act, 1944

6. Central Excise Custom Duty 749.67 07.02.2000 to Act, 1944 31.07.2003

Sr. Name of Statute Forum where dispute No is pending 1. Income Tax Act, ITAT, Ahemedabad 2. Income Tax Act, 1961 Commissioner of Income Tax

3. Central Sales Commissioner of Tax Act, 1956 Commercial Taxes, Appeals

4. Central Excise Customs, Excise and Act, 1944 Service Tax Appellate Tribunal

5. Central Excise Customs, Excise and Act, 1944 Service Tax Appellate Tribunal

6. Central Excise Supreme Court Act, 1944 10. The Company has no accumulated losses as at the period ended March 31,2014 and it has not incurred any cash losses in the period ended on that date or in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks.

12. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provision of clause 4(xiii) of the Order is not applicable to the Company.

14. The Company is not dealing or trading in Shares, Securities, Debentures and Other Investments. However the Company has maintained proper records of transactions and contracts in respect of investment in shares and other securities and timely entries have been made therein. The investment in the shares and other securities are held by the Company in its own name.

15. According to the information and explanation given to us, the Company has given guarantee of Rs. 1,225 Lacs for loans taken by subsidiary from bank. The terms of such guarantee are not prejudicial to the interest of the Company.

16. In our opinion, the Company has applied the term loan for the purpose for which it was raised.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that funds raised on short-term basis to the extent of Rs. 922.15 Lacs have been used for long-term investment.

18. According to the information and explanation given to us, the company has not made any preferential allotment of shares to parties covered in the register maintained under section 301 of the Act during the year.

19. The Company has, during the year issued 7,00,000 fully convertible unsecured debentures of Rs. 700.00 Lacs on which no security or charge was required to be created and the same have been fully converted in to equity shares during the year.

20. The Company has not raised any money by way of public issue during the year.

21. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the period, nor have we been informed of any such case by the Management.

For Manubhai & Shah Chartered Accountants Firm Registration No.:106041W

G. R. Parmar Place: Waghodia, Vadodara Partner Date: May 24, 2014 Membership No.: 121462

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of 20 Microns Limited ["the Company"], which comprise the Balance Sheet as at March 31, 2013, Statement of Profit and Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section [3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2013;

(b) in the case of Statement of Profit and Loss, of the profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows For the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies [Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A)of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act,we report that:

a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary forthe purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection(3C) of section 211 of the Companies Act, 1956;

e. on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274of the Companies Act, 1956.

The Annexure referred to in our report to the members of 20 Microns Limited [''the Company'') for the year ended on March 31,2013. We report that:

a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets except tagging details of fixed assets is in the process of updating in the fixed assets register.

b) As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification designed to cover all the fixed assets on rotation basis, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company. c) The fixed assets disposed of during the year, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

a) As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The company has maintained proper records of inventories. As explained to us, the discrepancies noticed on verification between physical stocks and book records were material and the same have been properly dealt with in the books of account.

a) The Company has granted unsecured loan to 3 parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding at any time during the year wasRs.31.37 Lacs and the year-end balance wasRs.31.37 Lacs.

b] In our opinion and according to information and explanation given to us, the loans are interest free and other terms and conditions are not prima facie prejudicial to the interest of the Company.

c) The loans given by the Company are interest free and repayable at the end of one year in single installment and on demand therefore the question of regular receipt of principal amount and interest does notaries.

d) The Company has taken unsecured loans from two subsidiary companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding at any time during the year was Rs. 145.97 Lacs and the year-end balance wasRs. 47.99 Lacs.

e) In our opinion and according to information and explanation given to us, the loans are interest free and other terms and conditions are not prima facie prejudicial to the interest of the Company.

f) The loans taken by the Company are interest free and repayable at the end of one year in single installment. The outstanding loan of Rs. 47.99 Lacs is not paid at the end of one year in single installment as per the terms of repayment. As the loans are interest free the question of regularity of its payment does not arise.

4. In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources do not exist for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. In respect of transactions need to be entered into a register maintained u/s301 of the Companies Act, 1956.

a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so maintained.

b] Having regard to the nature of transaction and non availability of comparable quotations, the reasonability of price in respect of the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year cannot be ascertained.

6. In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company has appointed firms of chartered accountants as internal auditors. On the basis of reports submitted by internal auditors, in our opinion the internal audit system is commensurate with the size and nature of company''s business.

8. The Central Government has prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, carried out a detailed examination of the same.

a] In our opinion and according to the information and explanation given to us, the company has been regular in depositing undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Investor Education and Protection Fund, Custom duty, Excise duty, Professional tax and other statutory dues as may be applicable to the company except in case of Income Tax deducted at Source, Sales Tax, Service Tax and Employees'' State Insurance dues where there was some delay on few occasions at some of the offices of the company.

b] According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, custom duty and excise duty were in arrears, as at 31st March, 2013 for a period of more than six months from the date they become payable.

c] The details of disputed statutory dues that have not been deposited on account of dispute are as under:

Sr. Name of Statute Nature of Dues Amount Period to Forum where No. (in LacsRs.) which the amount dispute is pending relates

1 Central Excise Act, 1944 Excise Duty 749.67 07.02.2000 to Supreme Court 31.07.2003

2 Central Excise Act, 1944 Excise Duty 2.00 1999-2000 Customs, Excise and Service Tax Appellate Tribunal

3 Central Excise Act, 1944 Custom Duty 2.77 2006-2007 Customs,

Excise and Service Tax Appellate Tribunal

4 Income Tax Act, 1961 Income tax 20.14 2003-2004 Commissio- ner of Income Tax

5 Income Tax Act, 1961 Income tax 1.31 2009-2010 Commissi- oner of Income Tax

6 Tamil Nadu General Sales Local Sales Tax 0.60 2004-2005 Appellate Dy.Commis- sioner, Tax Act, 1959 Commercial Taxs, Tamil Nadu

7 Central Sales Tax Act, 1956 Central Sales Tax 11.93 2008-2009 Commiss- ioner of Commercial Taxes, Appeals

10. The Company does not have accumulated losses and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks.

12. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund ora nidhi / mutual benefit fund / society as per the Chit Fund Act, 1982 and other state legislations. Therefore, clause 4[xiii] of the Order is not applicable to the Company.

14. The Company is not dealing or trading in Shares, Securities, Debentures and Other Investments. However the Company has maintained proper records of transactions and contracts in respect of investment in shares and other securities and timely entries have been made therein. The investment in the shares and other securities are held by the Company in its own name.

15. According to the information and explanation given to us, the Company has given guarantee ofRs. 1,225 Lacs for loans taken by subsidiary from bank. The terms of such guarantee are not prejudicial to the interest of the Company.

16. In our opinion, the term loans have been applied for the purpose for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that funds raised on short term basis have, prima facie, not been used for long-term investment.

18. During the year, the Company has made preferential allotment of warrants to the promoters and promoters group on July 12,2012. The promoters are covered in the Register maintained under Section 301 of the Companies Act, 1956. The terms and conditions of the issue are in accordance with Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 and hence the price at which shares have been issued is not prejudicial to the interest of the Company.

19. The Company has not issued any debentures during the year therefore paragraph 4(xix) of the Order is not applicable.

20. The Company has not raised any money by way of public issue during the year.

21. To the best of our knowledge and belief, and according to the information and explanations given to us, no fraud on or by the company was noticed or reported during the year.

For Manubhai & Co.

Chartered Accountants

Firm Registration No. 106041W

G R Parmar

Place: Waghodia Partner

Date : 28.05.2013 Membership No. 121462

Mar 31, 2012

1. We have audited the attached Balance Sheet of 20 MICRONS LIMITED ('the Company') as at March 31, 2012, and also the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with Auditing Standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 (order) and related amendments issued by the Central Government of India in terms of sub Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Attention is invited to Note No 30 regarding non accounting of loss of Rs 145.52 Lacs on cancellation of forward contracts and loss of Rs. 359.73 Lacs on open forward contracts on valuing the same to the market value as at the balance sheet date for sale of US Dollars for the reasons stated in the said note. As mentioned in the said note since investigations of the transactions and legal proceeding are in process and pending the ultimate outcome or decision in the matter, we are unable to comment of its impact on profit, reserves and liabilities.

5. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet, Statement of Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with books of account;

d) In our opinion, the Balance Sheet, Statement of Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Subsection (3C) of Section 211 of the Companies Act, 1956 except non recognition of loss on certain forward contracts for sale of US Dollars as required by Accounting Standard (AS -11) "The Effects of Changes in Foreign Exchange Rates" as mentioned in Note No. 30;

e) On the basis of written representations received from the directors as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of Clause (g) of sub section (1) of Section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, subject to comments in paragraph 4 above, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India:

i. in so far as it relates to Balance Sheet, of the state of affairs of the Company as at 31st March, 2012;

ii. in so far as it relates to Statement of Profit and Loss, of the Profit of the Company for the year ended on that date; and

iii. in so far as it relates to the Cash Flow Statement, of the Cash Flows of the Company for the year ended on that date.

LIMITED

20 MICRONS LIMITED

ANNEXURE TO AUDITORS' REPORT [Referred to paragraph 3 of our report of even date]

1.

a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b) As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification designed to cover all the fixed assets on rotation basis, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company.

c) The fixed assets disposed of during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

a) As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The company has maintained proper records of inventories. As explained to us, the discrepancies noticed on verification between physical stocks and book records were not material in relation to operations of the Company and such differences have been properly dealt with in the books of account.

a) The Company has not granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Consequently, reporting requirements as per clause (iii) (a) to (iii) (d) of paragraph 4 of the Order are not applicable in case of the Company.

b) The Company has taken unsecured loans from two subsidiary companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding at any time during the year was Rs 152.90 Lacs and the year-end balance was Rs. 152.90 Lacs.

c) In our opinion and according to information and explanation given to us, the loans are interest free and other terms and conditions are not prima facie prejudicial to the interest of the Company.

d) The loans taken by the Company are interest free and repayable at the end of one year in single installment therefore the question of regular payment of principal amount interest does not arise.

4. In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchase are of special nature and suitable alternative sources do not exist for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. In respect of transactions need to be entered into a register maintained u/s 301 of the Companies Act, 1956.

a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so maintained.

b) Having regard to the nature of transaction and non availability of comparable quotations, the reasonability of price in respect of the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year cannot be ascertained.

6. In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company has appointed firms of chartered accountants as internal auditors. On the basis of reports submitted by internal auditors, in our opinion the internal audit system is commensurate with the size and nature of company's business except that scope needs to be enhanced to cover Treasury Operations.

8. According to information and explanation given to us, the Company is under the process of maintaining cost records prescribed by Central Government under section 209(1) (d) of the Companies Act, 1956 in respect of manufacturing activities carried out by the Company.

a) In our opinion and according to the information and explanation given to us, the company has been regular in undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Investor Education and Protection Fund, Custom duty, Excise duty, Professional tax and other statutory dues as may be applicable to the company except in case of Income Tax deducted at Source, Sales Tax, Service Tax and Employees' State Insurance dues where there was some delay on few occasions at some of the offices of the company.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, custom duty and excise duty were in arrears, as at 31st March, 2012 for a period of more than six months from the date they become payable.

c) The details of disputed statutory dues that have not been deposited on account of dispute are as under:

Sr. Amount Period to which Nature of Forum where dispute Name of Statute (In Lacs the amount No. dues is pending Rs.) relates

1 Central Sales Tax Act, Local 1.35 2002-03 Appellate Tribunal 1956 Sales Tax

2 Sales Tax Act, 1959 Local 4.51 2003-04 Appellate Tribunal Sales Tax

3 Central Excise Act, Central 147.68 September 2003 to Customs, Excise and 1944 Excise June 2008 Service Tax Appellate Tribunal

7 Income Tax Act, 1961 Income 4.68 1995-96 Income Tax Appellate tax Tribunal

8 Income Tax Act, 1961 Income 20.15 2004-05 Commis sioner of tax Income Tax

9 Income Tax Act, 1961 Income 184.48 2004-05 Income Tax Appellate

tax Tribunal

10. The Company does not have accumulated losses and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks.

12. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society as per the Chit Fund Act, 1982 and other state legislations. Therefore, clause 4(xiii) of the Order is not applicable to the Company.

14. The Company has maintained proper records of transactions and contracts in respect of investment in shares and other securities and those timely entries have been made therein. The investment in the shares and other securities are held by the Company in its own name are note traded.

15. According to the information and explanation given to us, the Company has given guarantee of Rs. 1,250 Lacs for loans taken by subsidiary from bank. The terms of such guarantee are not prejudicial to the interest of the Company.

16. In our opinion, the term loans have been applied for the purpose for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that there are no funds raised on short-term basis that have been used for long-term investments.

18. During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures during the year therefore paragraph 4(xix) of the Order is not applicable.

20. The Company has not raised any money by way of public issues during the year.

21. As mentioned in Note No. 30, the Senior Executive of the Company, acting beyond the delegated powers, had booked forward contracts for sale of US Dollars. Total loss on account of all such contract is estimated at Rs. 505.25 Lacs, considering the exchange rate as on the balance sheet date. The Company, based on legal advice has disputed such debits with bank as well as future liability. Company is investigating the transactions and shall also resort to suitable legal remedy, as advised, against the Senior Executive and / or Bank.

For Manubhai & Co.

Chartered Accountants

Firm Registration No. 106041W

G. R. Parmar

Waghodia, Vadodara Partner

May 23, 2012 Membership No.: 121462

Mar 31, 2011

1. We have audited the attached Balance Sheet of 20 MICRONS LIMITED ('the Company') as at 31st March, 2011, and also the Profit and Loss Account for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with Auditing Standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 (order) and related amendments issued by the Central Government of India in terms of sub Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4 Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet, the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with books of account;

d) In our opinion, the Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Subsection (3C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of Clause (g) of sub section (1) of Section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India:

i. in so far as it relates to Balance Sheet, of the state of affairs of the Company as at 31st March, 2011;

ii. in so far as it relates to the Profit and Loss Account, of the Profit of the Company for the year ended on that date;

and iii. in so far as it relates to the Cash Flow Statement, of the Cash Flows of the Company for the year ended on that

date.

20 MICRONS LIMITED ANNEXURE TO AUDITORS' REPORT

[Referred to paragraph 3 of our report of even date]

1. In respect of its fixed assets:

a. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b. As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification during the year, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company.

c. In our opinion, the Company has not disposed of any substantial part of fixed assets during the year so as to affect going concern status.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. The company has maintained proper records of inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

3. (i) In respect of loans granted to parties covered in the register maintained u/s 301 of the Companies Act, 1956.

The Company has not granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Consequently, reporting requirements as per clause (iii) (a) to (iii) (d) of paragraph 4 of the Order are not applicable in case of the Company.

(ii) In respect of loans taken from parties covered in the register maintained u/s 301 of the Companies Act, 1956.

The Company has not taken any loans or advances in the nature of loans, secured or unsecured from parties covered in the register maintained under section 301 of the Companies Act, 1956 Consequently, reporting requirements as per clauses (iii) (e) to (iii) (g) of paragraph 4 of the Order are not applicable in case of the Company.

4. In respect of internal control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. In respect of transactions need to be entered into a register maintained u/s 301 of the Companies Act, 1956.

a. According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so maintained.

b. Having regard to the nature of transaction and non availability of comparable quotations, the reasonability of price in respect of the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year can not be ascertained.

6. In respect of deposits from public

In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. In respect of internal audit system

The Company has appointed firms of chartered accountants as internal auditors. On the basis of reports submitted by internal auditors, in our opinion the internal audit system is commensurate with the size and nature of company's business.

8. In respect of maintenance of cost records

According to information and explanation given to us, neither order has been passed by Central Government nor have cost records been prescribed under section 209(1) (d) of the Companies Act, 1956 in respect of products manufactured by the Company.

9. In respect of statutory dues:

a. In our opinion and according to the information and explanation given to us, the company has been regular in undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Investor Education and Protection Fund, Custom duty, Excise duty, Professional tax and other statutory dues as may be applicable to the company except in case of Income Tax deducted at Source, Sales Tax, Service Tax and Employees' State Insurance dues where there was some delay on few occasions at some of the offices of the company.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441A of the Companies Act, 1956, we are not in position to comment upon the regularity or otherwise of the Company in depositing the same.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, custom duty and excise duty were in arrears, as at 31st March, 2011 for a period of more than six months from the date they become payable.

c. The details of disputed statutory dues that have not been deposited on account of dispute are as under:

Sr. Name of Statute Nature of Amount dues (In Lacs No. Rs.)

1 Central Sales Tax Act, 1956 Central 2.90 sales tax

2 Central Sales Tax Act, 1956 Central 1.63 sales tax

3 Tamil Nadu Government Sales Tax Sales Tax 1.81 Act, 1959

4 Sales Tax Act, 1959 Local Sales 1.36 Tax

5 Sales Tax Act, 1959 Local Sales 0.89 Tax

6 Central Excise Act, 1944 Central 148.68 Excise

7 Income Tax Act, 1961 Income tax 4.68

8 Income Tax Act, 1961 Income tax 50.51

9 Income Tax Act, 1961 Income tax 113.05

Name of the Statute Period to which the Forum where dispute is amount relates pending

Central Sales Tax Act, 1956 2002-03 Appellate Tribunal

Central Sales Tax Act, 1956 2007-08 Assistant Commissioner of Sales Tax

Tamil Nadu Government Sales 2002-03 Appellate Tribunal Tax Act,1959

Sales Tax Act, 1959 2003-04 Appellate Tribunal

Sales Tax Act, 1959 2004-05 Appellate Tribunal

Central Excise Act, 1944 September 2003 to Customs, Excise and June 2008 Service Tax Appellate Tribunal Income Tax Act, 1961 1995-96 Income Tax Appellate Tribunal Income Tax Act, 1961 2004-05 Commissioner of Income Tax Income Tax Act, 1961 2004-05 Income Tax Appellate Tribunal

10. In respect of accumulated losses and cash losses

The Company does not have accumulated losses and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. In respect of dues to financial institution / banks / debentures

In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks.

12. In respect of loans and advances granted on the basis of security.

In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In respect of provisions applicable to Chit fund

In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society as per the Chit Fund Act, 1982 and other state legislations. Therefore, clause 4(xiii) of the Order is not applicable to the Company.

14. In respect of dealing or trading in shares, securities, debentures and other investment

As the company is not dealing or trading in shares, securities, debentures and other investments, provision of clause 4(xiv) of the Order is not applicable to the Company.

15. In respect of guarantee given for loans taken by others

According to the information and explanation given to us, the Company has given guarantee of Rs. 1250 Lacs for loans taken by subsidiary from bank. The terms of such guarantee are not prejudicial to the interest of the Company.

16. In respect of application of term loans

In our opinion, the term loans have been applied for the purpose for which they were raised.

17. In respect of fund used

According to the information and explanations given to us and on an overall examination of the balance sheet of the company, funds of Rs. 9.42 Crores raised on short-term basis, have been used for long-term investment.

18. In respect of preferential allotment of shares

During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19. In respect of securities created for debentures

The Company has not issued any debentures during the year therefore paragraph 4(xix) of the Order is not applicable.

20. In respect of end use of money raised by public issues

We have verified the end use of money raised by public issue as disclosed in the notes to the financial statements.

21. In respect of fraud

To the best of our knowledge and belief, and according to the information and explanation given to us, no fraud on or by the Company was noticed or reported during the year that causes the financial statements to be materially misstated.

For Manubhai & Co. Chartered Accountants

Firm Registration No. 106041W

Place: Waghodia, Vadodara (G. R. Parmar) Partner Date: May 19, 2011 Membership No.: 121462

Mar 31, 2010

1. We have audited the attached Balance Sheet of 20 MICRONS LIMITED (the Company) as at 31st March, 2010, and also the Profit and Loss Account for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with Auditing Standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 and related amendments issued by the Central Government of India in terms of sub Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4 Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet, the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with books of account;

d) In our opinion, the Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub section (3C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of directors is disqualified as on 31st March, 2010 from being appointed as a director in terms of Clause (g) of sub section (1) of Section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India:

i. in so far as it relates to Balance Sheet, of the state of affairs of the Company as at 31st March, 2010;

ii. in so far as it relates to the Profit and Loss Account, of the Profit of the Company for the year ended on that date; and

iii. in so far as it relates to the Cash Flow Statement, of the Cash Flow of the Company for the year ended on

ANNEXURE TO AUDITORS REPORT

[Referred to paragraph 3 of our report of even date]

1. In respect of its fixed assets:

a. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b. As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification during the year, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company.

c. In our opinion, the Company has not disposed of any substantial part of fixed assets during the year so as to affect going concern status.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. The company has maintained proper records of inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

3. (i) In respect of loans granted to parties covered in the register maintained u/s 301 of the Companies Act, 1956.

a. The Company had granted loan in earlier year to one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 170 lacs and the year-end balance of loan granted to such party was Rs. Nil.

b. In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions on which loan have been granted to party listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

c. The loan granted by the Company is repaid during the year and hence the question of overdue amount does not arise.

(ii) In respect of loans taken from parties covered in the register maintained u/s 301 of the Companies Act, 1956.

The Company has not taken any loans or advances in the nature of loans, secured or unsecured from parties covered in the register maintained under section 301 of the Companies Act, 1956 Consequently, reporting requirements as per clauses (iii) (e) to (iii) (g) of paragraph 4 of the Order are not applicable in case of the Company.

4. In respect of internal control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. In respect of transactions need to be entered into a register maintained u/s 301 of the Companies Act, 1956.

a. According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so maintained.

b. Having regard to the nature of transaction and non availability of comparable quotations, the reasonability of price in respect of the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year can not be ascertained.

6. In respect of deposits from public

In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. In respect of internal audit system

The Company has appointed firms of chartered accountants as internal auditors. On the basis of reports submitted by internal auditor, in our opinion the internal audit system is commensurate with the size and nature of companys business.

8. In respect of maintenance of cost records

According to information and explanation given to us, neither order has been passed by Central Government nor have cost records been prescribed under section 209(1) (d) of the Companies Act, 1956 in respect of products manufactured by the Company.

9. In respect of statutory dues:

a. In our opinion and according to the information and explanation given to us, the company has been regular in undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Investor Education and Protection Fund, Custom duty, Excise duty, Professional tax and other statutory dues as may be applicable to the company except in case of Income Tax deducted at Source, Sales Tax, Service Tax and Employees State Insurance dues where there was some delay on few occasions at some of the offices of the company.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441A of the Companies Act, 1956, we are not in position to comment upon the regularity or otherwise of the Company in depositing the same.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, custom duty and excise duty were in arrears, as at 31st March, 2010 for a period of more than six months from the date they become payable.

c. The details of disputed statutory dues that have not been deposited on account of dispute are as under:

Sr. Name of Statute Nature of dues Amount Period to which NO (In Lacs Rs.) the amount relates

1 Central Sales Tax Central sales tax 2.90 2002-03 Act, 1956

2 Central Sales Tax Central sales tax 1.63 2007-08 Act, 1956

3 Tamil Nadu Government Sales Tax 1.81 2002-03 Sales Tax Act, 1959

4 Central Excise Act, 1944 Central Excise 147.68 September 2003 to June 2008

5 Income Tax Act, 1961 Income tax 4.68 1995-96

6 Income Tax Act, 1961 Income tax 46.80 2004-05

Name of the statue Forum where dispute is pending

Central Sales Tax Act, 1956 Appellate Tribunal

Central Sales Tax Act, 1956 Assistant Commissioner of Sales Tax

Tamil Nadu Government Sales Tax, 1959 Appellate Tribunal

Customs,

Excise and Service Tax

Appellate Tribunal

Income Tax Act, 1961 Income Tax Appellate Tribunal

Income Tax Act, 1961 Commissioner of Income Tax

10. In respect of accumulated losses and cash losses

The Company does not have accumulated losses and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

11. In respect of dues to financial institution / banks / debentures

In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks.

12. In respect of loans and advances granted on the basis of security.

In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In respect of provisions applicable to Chit fund

In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society as per the Chit Fund Act, 1982 and other state legislations. Therefore, clause 4(xiii) of the Order is not applicable to the Company.

14. In respect of dealing or trading in shares, securities, debentures and other investment

As the company is not dealing or trading in shares, securities, debentures and other investments, provision of clause 4(xiv) of the Order is not applicable to the Company.

15. In respect of guarantee given for loans taken by others

According to the information and explanation given to us, the Company has given guarantee of Rs. 1250 Lacs for loans taken by subsidiary from bank. The terms of such guarantee are not prejudicial to the interest of the Company.

16. In respect of application of term loans

In our opinion, the term loans have been applied for the purpose for which they were raised.

17. In respect of fund used

According to the information and explanations given to us and on an overall examination of the balance sheet of the company, funds raised on short-term basis have, prima facie, not been used for long-term purpose.

18. In respect of preferential allotment of shares

During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19. In respect of securities created for debentures

The Company has not issued any debentures during the year therefore paragraph 4(xix) of the Order is not applicable.

20. In respect of end use of money raised by public issues

We have verified the end use of money raised by public issue as disclosed in the notes to the financial statements.

21. In respect of fraud

To the best of our knowledge and belief and according to the information and explanation given to us, fraud in the nature of defalcation of cash amounting to Rs. 10.38 Lacs by one of the employees of the company has been reported, for which the Company has lodged an FIR with relevant authorities and also claim has been filed with insurance company.

For Manubhai & Co.

Chartered Accountants

Firm Registration No. 106041W

Place: Vadodara (G. R. Parmar)

Date: May 31, 2010 Partner

Membership No.: 121462

Mar 31, 2007

1. We have audited the attached Balance Sheet of 20 MICRONS LIMITED (the Company) as at 31st March, 2007, and also the Profit and Loss Account for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with Auditing Standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 and related amendments issued by the Central Government of India in terms of sub Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that :

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet, the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with books of account;

d) In our opinion, the Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub - section (3C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on 31st March, 2007 and taken on record by the Board of Directors, we report that none of directors is disqualified as on 31st March, 2007 from being appointed as a director in terms of Clause (g) of sub section (1) of Section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India:

i. in so far as it relates to Balance Sheet, of the state of affairs of the Company as at 31st March, 2007;

ii. in so far as it relates to the Profit and Loss Account, of the Profit of the Company for the year ended on that date; and

iii. in so far as it relates to the Cash Flow Statement, of the Cash Flow of the Company for the year ended on that date.

Annexure to Auditors Report [Referred to paragraph 3 of our report of even date]

1. In respect of its fixed assets :

a. As per information and explanation given to us the Company is under process of compilation of proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b. As explained to us, the fixed assets have been physically verified by the management as per phased programme of verification during the year, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification as compared to the records maintained by the Company.

c. In our opinion, the Company has not disposed of any substantial part of fixed assets during the year so as to affect going concern status.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. The company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to the book records.

3. i) In respect of loans granted to parties covered in the register maintained u/s 301 of the Companies Act, 1956.

The Company has not granted any loans or advances to companies, firms or other parties covered in the Register maintained under section 301 of the Companies Act, 1956. Consequently, reporting requirements as per clauses (iii) (a) to (iii) (d) of paragraph 4 of the Order are not applicable in case of the Company.

ii) In respect of loans taken from parties covered in the register maintained u/s 301 of the Companies Act, 1956.

The Company has not taken any loans or advances in the nature of loans, secured or unsecured from parties covered in the register maintained under section 301 of the Companies Act, 1956 Consequently, reporting requirements as per clauses (iii) (e) to (iii) (g) of paragraph 4 of the Order are not applicable in case of the Company.

4. In respect of internal control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. In respect of transactions need to be entered into a register maintained u/s 301 of the Companies Act, 1956.

In our opinion and as explained to us, there were no contracts and arrangements referred in section 301 of the Companies Act, 1956 that need to be entered in the register required to be maintained under that section.

6. In respect of deposits from public

In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public. We are informed that no Order has been passed by the Company Law Board (the CLB) or National Company Law Tribunal (the NCLT) or Reserve Bank of India (the RBI) or any Court or any other Tribunal.

7. In respect of internal audit system

In our opinion, the internal audit system, in form of internal audit carried out during the year by firms of Chartered Accountants appointed by the management, is commensurate with the size of the Company and nature of its business.

8. In respect of maintenance of cost records

According to information and explanation given to us, neither order has been passed by Central Government nor cost records have been prescribed under section 209(1) (d) of the Companies Act, 1956 in respect of products manufactured by the Company.

9. In respect of statutory dues :

a. In our opinion and according to the information and explanation given to us, the company has been regular in undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Investor Education and Protection Fund, Employees State Insurance dues, Custom duty, Excise duty, Professional tax and other statutory dues as may be applicable to the company except in case of Income Tax deducted at Source, Sales Tax and Service Tax where there was some delay on few occasions at some of the locations.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441A of the Companies Act, 1956, we are not in position to comment upon the regularity or otherwise of the Company in depositing the same.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, custom duty and excise duty were in arrears, as at 31st March, 2007 for a period of more than six months from the date they become payable.

c. The details of disputed statutory dues of Rs. 96.84 Lacs that have not been deposited on account of dispute are as under:

Sr. Nature of dues Amount Forum where dispute is pending No. (in Lacs Rs.)

1 Central Sales Tax and Gujarat Sales Tax 88.66 Deputy Commissioner of Sales Tax, Vadodara

2 West Bengal Sales Tax 5.88 Assistant Commissioner of Sales Tax

3 Central Excise 2.30 Central Excise & Gold (Control) Appellate Tribunal

TOTAL 96.84

10.In respect of accumulated losses and cash losses

The Company has accumulated losses at the end of the financial year, which is not more than fifty percent of its net worth. However, it has not incurred cash losses in the financial year under report and in the immediately preceding financial year.

11.In respect of dues to financial institution / banks / debentures

In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks.

12.In respect of loans and advances granted on the basis of security.

In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13.In respect of provisions applicable to Chit fund

In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society as per the Chit Fund Act, 1982 and other state legislations. Therefore, clause 4(xiii) of the Order is not applicable to the Company.

14.In respect of dealing or trading in shares, securities, debentures and other investment

As the company is not dealing or trading in shares, securities, debentures and other investments, provision of clause 4(xiv) of the Order is not applicable to the Company.

15.In respect of guarantee given for loans taken by others

According to the information and explanation given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions and therefore paragraph 4(xv) of the Order is not applicable.

16.In respect of application of term loans

According to the information and explanations given to us the Company has not obtained any term loan during the year. The Company has utilized term loan for the purpose for which they were raised.

17.In respect of fund used

According to the information and explanations given to us and on an overall examination of the balance sheet and cash flow statement of the company, funds of Rs 38.11 lacs raised on short-term basis, have been used for long-term purpose.

18.In respect of preferential allotment of shares

During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19.In respect of securities created for debentures

The Company has not issued any debentures during the year therefore paragraph 4(xix) of the Order is not applicable.

20.In respect of end use of money raised by public issues

The Company has not raised any money by way of public issue during the year therefore paragraph 4(xx) of the Order is not applicable.

21.In respect of fraud

According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year that causes the financial statements to be materially misstated.

For MANUBHAI & CO. CHARTERED ACCOUNTANTS

(K. C. Patel) Place : Ahmedabad Partner

Date : 30th May, 2007 Membership No.: 30083.

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