Home  »  Company  »  Aarti Drugs Ltd  »  Quotes  »  Auditor Report
Enter the first few characters of Company and click 'Go'

Auditor Report of Aarti Drugs Ltd.

Mar 31, 2016

We have audited the accompanying financial statements of AARTI DRUGS LIMITED ("the Company"), 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 and a summary of significant accounting policies and other explanatory information.

Management''s responsibility for the 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 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.

These responsibilities also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 control, that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, 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 based on our audit of these financial statements.

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 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 true and fair view 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 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 issued by the Central Government of India in terms of Section 143 (11) of the Companies Act 2013, we give in the Annexure - A, a statement on the matters specified in paragraph 3 & 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 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 aforesaid 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 written representations received from the directors as on 31st March, 2016, 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 our separate report in "Annexure - B"; and

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

i. The Company has disclosed the impact of pending litigations as at 31st March, 2016 on its financial position in its financial statements. Refer Note no: 24.2 of the Financial Statements.

ii. The Company did not have any long-term contracts including derivatives 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.

In the Annexure, as required by the Companies (Auditor''s Report) Order, 2016 issued by the Central Government in terms of Section 143 (11) of the Companies Act 2013, on the basis of checks, as we considered appropriate, we report on the matters specified in paragraph 3 and 4 of the said order to the extent applicable to the Company.

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

(b) The Company has phased programme of physical verification of fixed assets by which all fixed assets are verified over a period of three years. In our opinion, periodicity of physical verification is reasonable having regard to the size of the Company and nature of the assets. We have been informed that no material discrepancy was noted on such physical verification.

(c) According to the information and explanations given to us and on the basis of examination of the records of the Company, title deeds of immovable properties other than self constructed immovable properties (buildings), are held in the name of the Company except Leasehold Lands Plot no''s R-A/13, E-106, E-105, S-33/34 (aggregate book value of Rs. 26.57 lakhs) are in the name of erstwhile entities which are merged with Company. According to explanations obtained from management, in view of merger through court scheme, leasehold land rights are deemed to be transferred to the Company and procedure for transferring in the name of the Company is in progress.

(ii) The stock of inventory has been physically verified during the year by the Management at reasonable intervals, except stock lying with third parties, confirmation of such stocks with the third parties has been obtained by the Company. 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. The discrepancies noticed on physical verification of stocks as compared to book records were not material; however the same have been dealt with the books of account.

(iii) The Company had granted loans to its wholly owned subsidiary covered in the register maintained under section 189 of the Companies Act, 2013 (''the Act'') during the year.

(a) In our opinion, the rate of interest and other terms and conditions on which the loans was granted was not, prima facie, prejudicial to the interest of the Company.

(b) The borrower have been regular in the payment of the principal and interest as stipulated by the management..

(c) The borrower has repaid the loan as at the year end and hence there is no overdue amounts in respect of such loan granted.

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

(v) The Company has not accepted any deposits from public during the year.

(vi) The Company has maintained cost records as required under sub section 1 of section 148 of the Companies Act, 2013. We have not, however, carried out a detailed examination of such records.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including the Provident Fund, Employees state insurance, Income tax, Sales tax, Wealth tax, Service tax, duty of Customs, duty of Excise, Value added tax, cess and any other statutory dues applicable to it.

(b) According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, custom duty, excise duty and value added tax which have not been deposited on account of any dispute except the following:

Forum where dispute is pending (Rs. in Lakhs)

Appellate Name of the Statute/Nature of the Commissioner/ Authorities and Total Dues Financial Year Dy. Commisioner Tribunals (Rs. in Lakhs)

The Central Excise Act, 1944/Custom FY 2007-08 Duty/Service Tax/Interest & Penalty - 38.88/- 38.88/-

Maharashtra Sales Tax Act, 2002/ FY 2007-08 Sales Tax 15.18/- - 15.18/-

Income Tax Act/Tax Interest & FY 1999-2000, Penalty FY 2012-13 55.41/- - 55.41/-

Total (Rs. in Lakhs) 70.59/- 38.88/- 109.47/-

(viii) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues for loan taken from financial institutions or bank or debenture holders.

(ix) In our opinion and according to the information and explanation given to us, the term loans raised during the year were applied for the purpose for which the loans were obtained. The Company did not raise any money by way of public offer or further public offer (including debt instruments) during the year.

(x) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

(xi) According to the information and explanations given 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 provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion and according to 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 explanation 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) According to the information and explanation given 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 explanation given to us, 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.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.



For GOKHALE & SATHE

CHARTERED ACCOUNTANTS

Firm Registration No.: 103264W



Sd/-

CA TEJAS J. PARIKH

PARTNER

M. No. 123215 Place: Mumbai,

Date: 5th May, 2016


Mar 31, 2014

We have audited the accompanying financial statements of AARTI DRUGS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and 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 13th 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 are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on 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 judgement, 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:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

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

(iii) 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 under provisions of section 227(3) of the Companies Act, 1956, 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 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 sub-section (3C) of section 211 of the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate 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, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in paragraph 1 under the heading Report on other legal and regulatory requirements 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 its fixed assets.

(b) The Company has phased programme of physical verification of its fixed assets by which all fixed assets are verified over a period of three years. In our opinion, periodicity of physical verification is reasonable having regard to the size of the Company and nature of its assets. We have been informed that no material discrepancies were noticed on such physical verification.

(c) Substantial part of fixed assets has not been disposed of during the year.

2. In respect of its Inventories:

(a) The Inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(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 inventory as compared to the book records.

3. In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firm or other parties covered in the register maintained under Section 301 of the Companies Act, 1956:

(a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

(b) The Company has taken loans during the year from parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 2,311.23 lakhs and the year end balance of loans taken was Rs. 1,735.83 lakhs.

(c) In our opinion, the rate of interest and other terms and conditions on which the loans had been taken by the Company from parties listed in the register maintained under Section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(d) There are no overdue amounts of the loans taken by the Company.

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 nature of its business with regard to purchase of inventory, fixed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. (a) The particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the

register required to be maintained under that section. (b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has accepted deposits from the public. In our opinion, the directives issued by the Reserve Bank of India and the provisions of Sections 58A and 58AA and other relevant provisions of the Act and the rules framed there under, where applicable, have been complied with.

7. In our opinion the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. In respect of statutory dues:

(a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues have been regularly deposited with appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2014 for a period of more than six months from the date they became payable.

(c) According to the records of the Company, the dues of Sales Tax, Income-Tax, Customs, Wealth-Tax, Service Tax, Excise Duty, Cess, which have not been deposited on account of disputes and the Forum where the dispute is pending are as under:

Nature of Statute Year Nature of the Dues Amount Forum Where Pending (Rs. in lakhs) Dispute is Pending

Income Tax Act, 1961 AY 2000-01 Income Tax penalty in 3.66 CIT (Appeals) - 14 dispute

Income Tax Act, 1961 AY 2007-08 Income Tax demand in 149.10 CIT (Appeals) - 13 dispute

Income Tax Act, 1961 AY 2009-10 Income Tax demand in 197.47 CIT (Appeals) - 13 dispute

Income Tax Act, 1961 AY 2010-11 Income Tax demand in 89.48 CIT (Appeals) - 13 dispute

Income Tax Act, 1961 AY 2010-11 Income Tax demand in 58.19 CIT (Appeals) - 14 dispute

Income Tax Act, 1961 AY 2011-12 Income Tax demand in 56.57 CIT (Appeals) - 13 dispute

Sales Tax FY 2007-08 Sales Tax demand 15.18 Jt. Comm of Sales Tax disputed Palghar

Central Excise 2012 Excise Demand 78.51 CESTAT

Central Excise 1998 Excise Demand 102.90 Supreme Court

10. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in dues repayable to Financial Institutions, Banks or Debenture holders.

12. In our opinion and according to the information and explanations 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 provisions of clause 4(xiii) of the Order are not applicable to the Company.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments. According the provisions of clause 4(xiv) of the Order are not applicable to the Company.

15. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the year.

16. Term loans availed by the Company were, prima facie, applied by the Company during the year for the purposes for which the loans were obtained.

17. On an overall basis, we are of the opinion that the funds raised on short term basis have prima facie not been used for long term investment.

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 raised any monies by way of issue of debentures during the year. Therefore, the provisions of clause 4(xix) of the Order are not applicable to the Company.

20. The Company has not raised any money by way of public issue during the year. Therefore, the provisions of clause 4(xx) of the Order are not applicable to the Company.

21. During the audit carried out by us, any fraud on or by the Company has not been noticed or reported during the year.

For PARIKH JOSHI & KoTHARE

CHARTERED ACCOUNTANTS

sd/-

CA Tejas Parikh

Membership Number: 123215

Place: Mumbai (Partner)

Date: 30th April, 2014 Firm Registration No.: 107547W


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of AARTI DRUGS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and 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"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on 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 judgement, 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:

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

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

(iii) 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 under provisions of section 227(3) of the Companies Act, 1956, 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 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 sub-section (3C) of section 211 of the Act;

(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 274 of the Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph 1 under the heading Report on other legal and regulatory requirements 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 its fixed assets.

(b) The fixed assets were physically verified by the Management during the year. We have been informed that no material discrepancies were noticed on such physical verification.

(c) Substantial part of fixed assets has not been disposed of during the year. On 22nd March, 2013, there was fire in one of the production block of manufacturing division of the Company and as a result of which certain plant and machineries and building were destroyed. However, in our opinion and according to the information and explanations given to us, it did not materially affect Company''s operations

2. In respect of its Inventories:

(a) The Inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(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 inventory as compared to the book records.

3. In respect of the loans, secured or unsecured, granted or taken by the Company to / from companies, firm or other parties covered in the register maintained under Section 301 of the Companies Act, 1956:

(a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

(b) The Company has taken loans during the year from parties covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 1,917.44 lakhs and the year end balance of loans taken was Rs. 1,320.63 lakhs.

(c) In our opinion, the rate of interest and other terms and conditions on which the loans had been taken by the company from parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(d) There are no overdue amounts of the loans taken by the Company.

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 nature of its business with regard to purchase of inventory, fixed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. (a) The particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has accepted deposits from the public. In our opinion, the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA and other relevant provisions of the Act and the rules framed there under, where applicable, have been complied with.

7. In our opinion the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1 )(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. In respect of statutory dues:

(a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues have been regularly deposited with appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2013 for a period of more than six months from the date they became payable.

10. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in dues repayable to Financial Institutions, Banks or Debenture holders.

12. In our opinion and according to the information and explanations 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 provisions of clause 4(xiii) of the Order are not applicable to the Company.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments. According the provisions of clause 4(xiv) of the Order are not applicable to the Company.

15. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the year.

16. Term loans availed by the Company were, prima facie, applied by the Company during the year for the purposes for which the loans were obtained.

17. On an overall basis, we are of the opinion that there are no funds raised on short term basis that have been used for long term investment.

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 raised any monies by way of issue of debentures during the year. Therefore, the provisions of clause 4(xix) of the Order are not applicable to the Company.

20. The Company has not raised any money by way of public issue during the year. Therefore, the provisions of clause 4(xx) of the Order are not applicable to the Company.

21. During the audit carried out by us, any fraud on or by the Company has not been noticed or reported during the year.

For PARIKH JOSHI & KOTHARE

CHARTERED ACCOUNTANTS

Sd/-

CA Tejas Parikh

Membership Number: 123215

Place: Mumbai (Partner)

Date: 16th May, 2013 Firm Registration No.: 107547W


Mar 31, 2012

1. We have audited the attached Balance Sheet of AARTI DRUGS LIMITED, as at 31st March, 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 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 a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. As stated in Note 23.2, Suyash Laboratories Ltd. (SLL), an erstwhile 100 % subsidiary of Aarti Drugs Ltd. (ADL) was amalgamated on 6th July, 2012, with ADL with effect from April 1, 2011, in accordance with a scheme of Amalgamation sanctioned by the Hon'ble High Court of Judicature at Bombay. These financial statements include the financial statements of the erstwhile SLL for the year ended March 31, 2012, which have not been audited by us and have been audited by another auditor whose report have been furnished to us. Our opinion on the financial statements, to the extent they have been derived from the financial statements of the erstwhile SLL, is based solely on the report of the other auditor.

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

(i) 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;

(ii) 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;

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

(iv) In our opinion, the Balance Sheet and Statement of Profit and Loss 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;

(v) 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 the 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;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, 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 31st March, 2012;

(b) in the case of the 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.

ANNEXURETO THE AUDITORS' REPORT (Referred to in para 3 of our Report of even date)

As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and explanations given to us and on the basis of such checks, as we considered appropriate, we have to state that:

The nature of the Company's business during the year has been such that clause (xiii) pertaining to Chit Funds etc, and clause (xiv) pertaining to Dealing/Trading in Securities etc, of paragraph 4 of the Companies (Auditor's Report) Order, 2003, are not applicable to the Company.

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

(b) The fixed assets were physically verified by the Management during the year.

We have been informed that no material discrepancies were noticed on such physical verification.

(c) Substantial part of fixed assets has not been disposed of during the year.

(d) On 27th February, 2012 some part of manufacturing plant of division erstwhile company Suyash Laboratories Ltd. (Amalgamating Company) was destroyed by fire.

(ii) (a) The stock of inventory has been physically verified during the year by the Management at reasonable intervals.

(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) The company is maintaining proper records of inventory. The discrepancies noticed on physical verification of stocks as compared to book records were not material, however, the same have been properly dealt with in the books of account.

(iii) (a) The Company has not granted unsecured loan to any parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) The Company has taken loans from parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 524.01 lakhs and the year- end balance of the loans taken was Rs. 481.01 lakhs.

(c) In our opinion, the rate of interest and other terms and conditions on which the loans had been taken by the company from parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(d) The loans are repayable on demand.

(e) There are no overdue amounts of the loans taken by the company.

(iv) In our opinion, 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. During the course of our audit no major weakness has been observed in the internal controls.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public. In our opinion, the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA and other relevant provisions of the Act and the rules framed there under, where applicable, have been complied with.

(vii) In our opinion, the company has an internal audit system commensurate with its size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) (a) The Company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts were payable in respect of income tax, wealth tax, service tax, sales tax, customs duty, for more than six months from the date they became payable.

(c) According to the records of the Company, the dues of Sales Tax, Income-Tax, Customs, Wealth-Tax, Service Tax, Excise Duty, Cess, which have not been deposited on account of disputes and the Forum where the dispute is pending are as under:

Nature of Statute Nature of the Dues Amount Forum where Pending (Rs.in lakhs) Dispute is pending

Central Excise Excise Demand 102.90 CEGAT Supreme Court Income Tax Income Tax 27.34 CIT ( Appeals ) Act,1961 Demand in dispute pertaining to erstwhile Suyash Laboratories Ltd.

(x) The Company does not have accumulated losses. The Company has not incurred cash losses in the financial year under report and in the immediately preceding financial year.

(xi) The Company has not defaulted in repayment of dues to financial institutions or banks.

(xii) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) According to the information and explanations given to us, no guarantee has been given for loans taken by others from banks or financial institutions.

(xiv) Term loans availed by the Company were, prima facie, applied by the Company during the year for the purposes for which the loans were obtained.

(xv) On an overall basis, the funds raised on short-term basis have, prima facie, not been used for long-term investment.

(xvi) The Company has not made preferential allotment of shares to parties and companies covered in the Register, maintained under section 301 of the Companies Act, 1956, during the year.

(xvii) The company has not issued debentures and hence requirement of reporting regarding creation of security in respect of debentures issued does not arise.

(xviii) Based on the checks carried out by us, any fraud on or by the Company has not been noticed or reported during the year.

For PARIKH JOSHI & KOTHARE

CHARTERED ACCOUNTANTS

Sd/-

(CA YATIN R. VYAVAHARKAR)

M.No.33915

PARTNER

Firm Registration No.: 107547W

Place: Mumbai,

Date: 9th July, 2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of AARTI DRUGS LIMITED, as at 31st March, 2011 and also the Profit and Loss Account 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 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 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 above, we report that:

(i) 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;

(ii) 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;

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

(iv) In our opinion, the Balance Sheet and Profit and 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;

(v) 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 the 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;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, 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 31st March, 2011;

(b) in the case of the Profit and Loss Account, 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.

Annexure To The Auditors' Report (Referred to in para 3 of our Report of even date)

As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and explanations given to us and on the basis of such checks, as we considered appropriate, we have to state that:

The nature of the Company's business during the year has been such that clause (xiii) pertaining to Chit Funds etc, and clause (xiv) pertaining to Dealing/Trading in Securities etc, of paragraph 4 of the Companies (Auditor's Report) Order, 2003, are not applicable to the Company.

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

(b) The fixed assets were physically verified by the Management during the year.

We have been informed that no material discrepancies were noticed on such physical verification.

(c) Substantial part of fixed assets has not been disposed of during the year.

(ii) (a) The stock of inventory has been physically verified during the year by the Management at reasonable intervals.

(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) The company is maintaining proper records of inventory. The discrepancies noticed on physical verification of stocks as compared to book records were not material, however, the same have been properly dealt with in the books of account.

(iii) (a) The Company has granted unsecured loan to a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 127.92 lakhs and the year- end balance of the loan given was Rs. NIL.

(b) The Company has taken loans from parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 85.01 lakhs and the year- end balance of the loans taken was Rs.85.01 lakhs.

(c) In our opinion, the rate of interest and other terms and conditions on which the loans had been taken by the company from parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(d) The loans are repayable on demand.

(e) There are no overdue amounts of the loans taken by the company.

(iv) In our opinion, 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. During the course of our audit no major weakness has been observed in the internal controls.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public. In our opinion, the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA and other relevant provisions of the Act and the rules framed thereunder, where applicable, have been complied with.

(vii) In our opinion, the company has an internal audit system commensurate with its size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) (a) The Company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts were payable in respect of income tax, wealth tax, service tax, sales tax, customs duty, for more than six months from the date they became payable.

(c) According to the records of the Company, the dues of Sales Tax, Income-Tax, Customs, Wealth-Tax, Service Tax, Excise Duty, Cess, which have not been deposited on account of disputes and the Forum where the dispute is pending are as under:

Nature of Statute Nature of the Amount Forum where Dues Pending (Rs. in Dispute is lacs) pending

1. Income Tax Act Income Tax Demand 10.87 ITAT

2. Income Tax Act Income Tax Demand 24.08 High Court

3. Central Excise Excise Demand 102.90 CEGAT Supreme Court

(x) The Company does not have accumulated losses. The Company has not incurred cash losses in the financial year under report and in the immediately preceding financial year.

(xi) The Company has not defaulted in repayment of dues to financial institutions or banks.

(xii) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) According to the information and explanations given to us, no guarantee has been given for loans taken by others from banks or financial institutions.

(xiv) Term loans availed by the Company were, prima facie, applied by the Company during the year for the purposes for which the loans were obtained.

(xv) According to the information and explanations given to us and on an overall examination of the financial statements of the company and after placing reliance on the reasonable assumptions made by the company for classification of usage of funds, we are of the opinion that, prima facie, as at the close of the year, short term funds amounting to Rs.19.52 crores have been utilized for long term purposes.

(xvi) The Company has not made preferential allotment of shares to parties and companies covered in the Register, maintained under section 301 of the Companies Act, 1956, during the year.

(xvii) The company has not issued debentures and hence requirement of reporting regarding creation of security in respect of debentures issued does not arise.

(xviii) Based on the checks carried out by us, any fraud on or by the Company has not been noticed or reported during the year.

For PARIKH JOSHI & KOTHARE CHARTERED ACCOUNTANTS

Sd/- (YATIN R. VYAVAHARKAR) M.No.33915 PARTNER Firm Registration No.:107547W

Place : Mumbai, Date : 25th May, 2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of AARTI DRUGS LIMITED, as at 31st March, 2010 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. 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 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 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 above, we report that:

(i) 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;

(ii) 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;

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

(iv) In our opinion, the Balance Sheet and Profit and 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;

(v) 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 the directors is disqualified as on 31s 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;

(vi) Without qualifying our opinion, we draw attention to Note 10 (c) of Schedule U: Notes annexed to and forming part of accounts for the year ended 31st March 2010. The company has changed the timing of the accrual and accounting of Directors Commission from the date of the approval of the financial statements for the year by the shareholders to the balance sheet date of the concerned financial year. Due to this, the Net Profit for the year and the Reserves are stated lower, and the Current Liabilities and Provisions higher, by Rs.92,43,764/-.

(vii)ln our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, 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 31st March, 2010;

(b) in the case of the Profit and Loss Account, 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.

Annexure To The Auditors Report (Referred to in para 3 of our Report of even date)

As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and explanations given to us and on the basis of such checks, as we considered appropriate, we have to state that:

The nature of the Companys business during the year has been such that clause (xiii) pertaining to Chit Funds etc, and clause (xiv) pertaining to Dealing/Trading in Securities etc, of paragraph 4 of the Companies (Auditors Report) Order, 2003, are not applicable to the Company.

(i) (a) The Company has maintained proper records showing full particulars including Quantitative details and situation of its fixed assets.

(b) The fixed assets were physically verified by the Management during the year. We have been informed that no material discrepancies were noticed on such physical verification.

(c) Substantial part of fixed assets has not been disposed of during the year.

(ii) (a) The stock of inventory has been physically verified during the year by the Management at reasonable intervals.

(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) The company is maintaining proper records of inventory.The discrepancies noticed on physical verification of stocks as compared to book records were not material, however, the same have been properly dealt with in the books of account.

(iii) (a) The Company has granted unsecured loan, to Company, covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 132.89 lakhs and the year- end balance of the loan given was Rs. 127.92 lakhs.

(b) The Company has not taken a loan from a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 75.76 lakhs and the year- end balance of the loan given was Rs.73.76 lakhs.

(c) In our opinion, the rate of interest and other terms and conditions on which the loan had been granted to the company listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(d) The loan is repayable on demand.

(e) There is no overdue amount of the loan given to the company covered in the Register maintained under section 301 of the Companies Act, 1956

(iv) In our opinion, 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. During the course of our audit no major weakness has been observed in the internal controls.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices w,hich are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has accepted deposits from the public. In our opinion, the directives issued by the Reserve Bank of India and the provisions of sections 58A and 58AA and other relevant provisions of the Act and the rules framed thereunder, where applicable, have been complied with.

(vii) In our opinion, the company has an internal audit system commensurate with its size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

(ix) (a) The Company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts were payable in respect of income tax, wealth tax, service tax, sales tax, customs duty, for more than six months from the date they became payable.

(c) According to the records of the Company, the dues of Sales Tax, Income-Tax, Customs, Wealth-Tax, Service Tax, Excise Duty, Cess, which have not been deposited on account of disputes and the Forum where the dispute is pending are as under:

Nature of Statute Nature of the Dues Amount Forum where

Pending (Rs. in lacs) Dispute is

pending 1. Income Tax Act Income Tax Demand 10.87 ITAT

2. Income Tax Act Appeal for Penalty Order 1.09 CIT (Appeals)

3. Income Tax Act Income Tax Demand 24.08 High Court

4. Central Excise Excise Demand 102.90 CEGATSupreme court

(x) The Company does not have accumulated losses. The Company has not incurred cash losses in the financial year under report and in the immediately preceding financial year.

(xi) The Company has not defaulted in repayment of dues to financial institutions or banks.

(xii) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) According to the information and explanations given to us, no guarantee has been given for loans taken by others from banks or financial institutions.

(xiv) Term loans availed by the Company were, prima facie, applied by the Company during the year for the purposes for which the loans were obtained.

(xv) On an overall basis, the funds raised on short-term basis have, prima facie, not been used for long term investment.

(xvi) The Company has made preferential allotment of shares, on conversion of convertible warrants, to parties and companies covered in the Register, maintained under section 301 of the Companies Act, 1956, during the year. The price at which shares have been issued is as per the letter of offer made to them at the time of issue of warrants and are not prejudicial to the interest of the Company.

(xvii)The company has not issued debentures and hence requirement of reporting regarding creation of security in respect of debentures issued does not arise.

(xviii)ln relation to the shares mentioned in clause (xvi), the Company has raised money on conversion of convertible share warrants during the year and we have verified the end use of such money with the necessary documents and in our opinion the company has made adequate disclosures regarding the same.

(xix) Based on the checks carried out by us, any fraud on or by the Company has not been noticed or reported during the year.



For PARIKH JOSHI & KOTHARE

CHARTERED ACCOUNTANTS

Sd/-

(CA Yatin R. Vyavaharkar)

M. No. 33915

Partner

Firm Registration No.: 107547W

Place: Mumbai,

Date: 26th May, 2010

Find IFSC