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Auditor Report of Aditya Birla Chemicals (India) Ltd.

Mar 31, 2015

1 We have audited the accompanying financial statements of ADITYA BIRLA CHEMICALS (INDIA) LIMITED("the Company"), which comprise the Balance Sheet as at March 31, 2015, 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

2 The management and Board of Directors of the Company are 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 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; 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

3 Our responsibility is to express an opinion on these 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 there under. 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

4 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 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 accounting policies used and the reasonableness of the accounting estimates made by the Company's management and Board of Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

6. 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 2015, its profit and its cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements

7 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 sectionl43 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

8 As required by section 143(3) of the Act, we further 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 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 aforesaid financial statements comply with the applicable 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 March 31, 2015, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of Section 164(2) of the Act

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

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements. Refer Note B-36 of the financial statements

(ii) The Company assesses periodically the foreseeable losses on all its long term contracts. As at end of the year under report there were no such foreseeable losses. The company did not have any derivative contracts as at the date of Balance Sheet

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

Annexure referred to in paragraph 7 Our Report of even date to the members of ADITYA BIRLA CHEMICALS (INDIA) LIMITED on the accounts of the company for the year ended 31st March, 2015

On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of our audit, we report that:

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

(b) As explained to us, fixed assets have been physically verified by the management at periodic intervals which in our opinion is reasonable having regard to the size of the company and the nature of its assets. As informed to us no material discrepancies were noticed on such verification;

(ii) (a) The physical verification of inventories has been conducted at periodic intervals by the management;

(b) 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 and no material discrepancies were noticed on physical verification

(iii) The company has not granted any loans, secured or unsecured to/from companies, firms or other parties covered in the register maintained under section 189 of the Act. Hence the requirement of clause (iii) (a) and (iii)(b) of paragraph 3 of the Order are not applicable to it

(iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventories, fixed assets and for the sales of goods/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, no major weakness in the internal control system pertaining to these areas has been noticed or reported

(v) The Company has not accepted any deposits from the public. Hence clause (v) of paragraph 3 of the Order is not applicable to it

(vi) We have broadly reviewed the accounts and records maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records 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 maintained

(vii) (a) According to the information and explanations given to us and based on the records of the company examined by us, the company is regular in depositing with the appropriate authorities the undisputed statutory dues, including Provident Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Value Added Tax, Duty of Custom, Duty of Excise, Cess and other statutory dues as applicable to the Company;

(b) According to the information and explanations given to us and based on the records of the company examined by us, the following dues of Income Tax, Wealth Tax, Service Tax,Value Added Tax, Sales Tax, Duty of Customs,Duty of Excise, Cess which have not been deposited on account of disputes:

Name of the Nature Period Statute of dues

Income Tax Act 1961 Income AY 2007-08 , AY 2008-09, Tax and AY 2010-11 Interest

AY 2002-03 AY 2006-07 & AY 2009-10

Sales Tax / Trade Tax Sales Tax AY 2010-11

FY 2009-10, FY 2010-11

UP Tax on Entry of Goods Entry Tax FY 2006-07 to FY 2011-12 into Local Area Tax, 2007

Central Excise Act 1944 Cenvat and FY 2000-01 to 2006-07, Penalty FY 2008-09 to FY 2012-13

(FY 1998-1999,1996-2000, 2007-2008)

FY 2004-2008

FY 2006-07

Sec 94 of Finance Service Tax FY 2005-06 & FY 11-12 act 1994 and Penalty FY 2006-2007

FY 2005-07

Name of the Statute Amount Forum where dispute is (Rs in pending Lac)

Income Tax Act 1961 696.12 CIT (Appeals) and Petition u/s 154

8.44 CIT (Appeals)

Sales Tax/ Trade Tax 7.03 Office of the Additional Commissioner(A), Mirzapur

40.61 The Joint Commissioner of Commercial Taxes (Appeal), Ranchi

UP Tax on Entry of Goods into Local Area Tax, 2007 212.75 Supreme court Delhi

Central Excise Act, 1944 869.23 CESTAT, New Delhi

8.13 CESTAT High Court

525.70 CESTAT, Kolkata

12.78 AC, Central Excise, Mirzapur

Sec 94 of Finance act 1994 159.11 CESTAT, New Delhi

25.11 CESTAT, New Delhi

105.02 CESTAT, Kolkata

(c) The Company has transferred the required sums to the Investor Education and Protection Fund during the year within time as prescribed by the relevant provisions of the Companies Act, 1956 and rules made there under

(viii) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash losses in the current and immediately preceding financial year

(ix) Based on our audit procedures and as per the information and explanations given, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution or bank

(x) In our opinion, and according to the information and explanations given to us, the company has given guarantee to a bank favoring its overseas subsidiary which has not yet availed credit facilities against the said guarantee; in our opinion, terms of such guarantee are not, prima facie, prejudicial to the interest of the company

(xi) Based on information and explanations given to us, the term loans were applied by the Company during the year for the purposes for which the loans were obtained

(xii) During the course of our examination of the books and records of the company, carried in accordance with the auditing standards generally accepted in India, we have neither come across any instance of fraud on or by the Company noticed or reported during the course of our audit nor have we been informed of any such instance by the Management of the Company

For Khimji Kunverji & Co

Chartered Accountants

Firm Registration No 105146W

Place: Mumbai Hasmukh B Dedhia

Date: May 13, 2015 (Partner) F-033494


Mar 31, 2014

1. We have audited the accompanying financial statements of ADITYA BIRLA CHEMICALS (INDIA) 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

2. 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") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of per General Circular 15/2013 dated September 13, 2013 issued by the Ministry of Corporate Affairs). 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

3. 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

4. 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.

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

6. 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 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 Report on Other Legal and Regulatory Requirements

7. 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.

8. 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 applicable Accounting Standards referred to in subsection (3C) of section 211 of the Act;

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, we report that 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 Act;

Annexure referred to in paragraph 7 of the Our Report of even date to the members Aditya Birla Chemicals (India) Limited on the accounts of the company for the year ended 31st March, 2014

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

(b) The Company has a program for phased physical verification of all its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification

(c) The Company has not disposed off substantial part of its fixed assets during the year

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year

(b) The procedures of physical verification of inventory followed by the managements 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 and no material discrepancies were noticed on physical verification

(Hi) The Company has neither taken nor granted any Loans, secured or unsecured from/ to companies, firms or other parties covered in the register maintained under section 301 of the Act. Accordingly, clause (iii)(b) to (iH)(g) of paragraph 4 of the order are not applicable to company for the year

(iv) In our opinion and according to the information and explanations given, there is 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 examination of the books and records of the Company and according to the information and explanations given, and as per checking carried out in accordance with the auditing standards generally accepted in India, neither we have observed nor have we been reported of any continuing failure to correct major weakness in the internal control system relating to these areas

(v) Based on the audit procedures appHed and according to the information and explanations given, there are no contracts or arrangements referred to in section 301 of the Act that need to be entered in the register maintained under that section. Hence clause (v)(b) of para 4 of the Order is not applicable

(vi) The Company has not accepted any deposits from public to which the provisions of sections 58A, 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the pubHc applies

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

(viii) We have broadly reviewed the accounts and records maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records unde section 209(1)(d) of the Act and are of the opinion that, prima facie, the prescribed accounts and records have been maintained

(ix) (a) The Company is generally regular in depositing with appropriate authorities 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 material statutory dues applicable to it. There were no arrears as at March 31, 2014 for a period exceeding six months from the date they became payable

(b) According to the information and explanations given, there are no dues of sales-tax, income-tax, wealth-tax, service tax, custom duty, excise duty and cess, which have not been deposited on account of any dispute except as under:

Name of Statute the Nature of dues Period Income Tax Act 1961 Income Tax and AY 2002-03 & 2006-07 Interest AY 2007-08

AY 2008-09, 2009-10 & 2010-11

Sales Tax/ Trade Tax Sales Tax FY 2003-04

FY 2007-08 and FY 2008-09

UP Tax on Entry of Entry Tax FY 2006-07 to FY 2011-12 Goods into Local Area Tax, 2007

Central Excise Act Cenvat and FY 1995-96, 1999-2000, 2000-01 1944 Penalty 2005-06, 2006-07 & 2007-08

FY 1996-97 to FY 2000-01

FY 2004-2008

FY 2006-07 FY 2007-08 to FY 2012-13

Sec 94 of Finance Service FY 2005-06 & 2006-07 act 1994 Tax and Penalty Fy 2004-2008

Amount Forum where dispute is Name of the Statute (Rs in Lac) pending

Income Tax Act 1961 5.10 CIT (Appeal), Ranchi

197.02 CIT (Appeals) and Petition u/s 154

502.44 CIT(Appcal), Ranchi

Sales Tax / Trade Tax 10.86 Allahabad High Court

7.33 Office of the Additional Commissioner (A), Mirzapur

Up Tax on Entry of Goods 212.75 Supreme court, New Delhi into Local Area Tax 2007

603.82 CESTAT, New Delhi

Central Excise Act 1944 8.06 High Court, Allahabad

525.70 CESTAT, Kolkata

12.78 AC, Central Excise, Mirzapur

168.48 JC/Commissioner of CE Allahabad

Sec 94 Finace act 1994 184.66 CESTAT, New Delhi High Court, Allahabad

105.02 CESTAT, Kolkata

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year

(xi) Based on our audit procedures and as per the information and explanations given, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution or bank

(xii) According to the information and explanations given, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities

(viii) In our opinion, the Company is not a chit fund or a nidihi/ mutual benefit fund/ Society. Therefore, the provisions of clause 4(xiii) of para 4 of the Order are not applicable to the Company

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of para 4 of the Order are not applicable to the Company

(xv) According to the information and explanations given, the Company has not given any guarantee for loans taken by others from banks or financial institutions

(xvi) Based on information and explanations given to us, the term loans were applied by the Company during the year for the purposes for which the loans were obtained

(xvii) According to the information and explanations given and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment

(xviii) During the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act

(xix) The Company has not issued any debentures during the year

(xx) The Company has not raised any money through a public issue during the year

(xxi) During the course of our examination of the books and records of the company, carried in accordance with the auditing standards generally accepted in India, we have neither come across any instance of fraud on or by the Company noticed or reported during the course of our audit nor have been informed of any such instance by the Management.

For Khimji Kunverji & Co Chartered Accountants Firm Registration No 105146W

Place: Mumbai Hasmukh B Dedhia Date: May 07, 2014 (Partner) F-033494


Mar 31, 2013

Report on the Financial Statements

1. We have audited the accompanying financial statements of ADITYA BIRLA CHEMICALS (INDIA) LIMITED ("the Company")'' which comprise the Balance Sheet as at March 31'' 2013'' 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

2. 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

3. 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.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedural 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.

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

6. 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 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 Report on Other Legal and Regulatory Requirements

7. 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.

8. 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 applicable Accounting Standards referred to in subsection (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'' we report that 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 referred to in paragraph 7 of the Our Report of even date to the members Aditya Birla Chemicals (India) Limited on the accounts of the company for the year ended 31st March'' 2013

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

(b) The Company has a program for phased physical verification of all its fixed assets which in our opinion'' is reasonable having regard to the size of the Company and the nature of its assets. As informed'' no material discrepancies were noticed on such verification

(c) The Company has not disposed off substantial part of its fixed assets during the year

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year

(b) The procedures of physical verification of inventory followed by the managements 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 and no material discrepancies were noticed on physical verification

(Hi) The Company has neither taken nor granted any Loans'' secured or unsecured from/ to companies'' firms or other parties covered in the register maintained under section 301 of the Act. Accordingly'' clause (Hi)(b) to (iH)(g) of paragraph 4 of the order are not applicable to company for the year

(iv) In our opinion and according to the information and explanations given'' there is 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 examination of the books and records of the Company and according to the information and explanations given'' and as per checking carried out in accordance with the auditing standards generally accepted in India'' neither we have observed nor have we been reported of any continuing failure to correct major weakness in the internal control system relating to these areas

(v) Based on the audit procedures appHed and according to the information and explanations given'' there are no contracts or arrangements referred to in section 301 of the Act that need to be entered in the register maintained under that section. Hence clause (v)(b) of para 4 of the Order is not applicable

(vi) The Company has not accepted any deposits from public to which the provisions of sections 58A'' 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules'' 1975 with regard to the deposits accepted from the pubHc applies

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

(viii) We have broadly reviewed the accounts and records maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(l)(d) of the Act and are of the opnion that'' prima facie'' the prescribed accounts and records have been maintained.

(ix) (a) The Company is generally regular in depositing with appropriate authorities 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 material statutory dues applicable to it. There were no arrears as at March 31'' 2013 for a period exceeding six months from the date they became payable

(b) According to the information and explanations given'' there are no dues of sales-tax'' income-tax'' wealth-tax'' service tax'' custom duty'' excise duty and cess'' which have not been deposited on account of any dispute except as under:

Name of the Nature Period Statute of dues

Income Tax Act 1961 Income AY 2002-03 & 2006-07 Tax and Interest AY 2007-08

AY 2008-09'' 2009-10 & 2010-11

Sales Tax/ Trade Sales FY 1989-90'' 1990-91 & Tax Tax 2003-04

AY 2005-06

UP Tax on Entry of Good; Entry FY 2006-07 to FY 2011-12

into Local Area Tax'' 2007 Tax

Central Excise Act 1944 Cenvat and FY 1995-96''1999-2000'' Penalty 2005-06 & 2007-08

FY 1996-97 to FY 2000-01

FY 2000-01 to FY 2006-07

FY 2004-2008

FY 2006-07

Sec 94 of Finance Service FY 2005-06 & 2006-07 act 1994 Tax and Penalty

Name Amount Forum where dispute is (Rs in pending Lac)

Income Tax Act 1961 5.10 CIT (Appeal)'' Ranchi

197.02 CIT (Appeals) and Petition u/s 154 502.44 CIT(Appcal)'' Ranchi

Sales Tax/ Trade 13.79 Allahabad High Court

26.69 Office of the Joint Commissioner (A)'' Mirzapur

UP Tax on Entry of Good; 217.52 Supreme court

58.64 CESTAT'' New Delhi

4.53 High Court'' Allahabad

561.00 CESTAT'' New Delhi

525.70 CESTAT'' Kolkata

7.38 AC'' Central Excise'' Mirzapur

164.32 CESTAT'' New Delhi

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year

(xi) Based on our audit procedures and as per the information and explanations given'' we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution or bank

(xii) According to the information and explanations given'' the Company has not granted any loans and advances on the basis of security by way of pledge of shares'' debentures and other securities

(xiii) 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 para 4 of the Order are not applicable to the Company

(xiv) In our opinion'' the Company is not dealing in or trading in shares'' securities'' debentures and other investments. Accordingly'' the provisions of clause 4(xiv) of para 4 of the Order are not applicable to the Company

(xv) According to the information and explanations given'' the Company has not given any guarantee for loans taken by others from banks or financial institutions

(xvi) Based on information and explanations given to us'' the term loans were applied by the Company during the year for the purposes for which the loans were obtained

(xvii)According to the information and explanations given and on an overall examination of the balance sheet of the Company'' we report that no funds raised on short-term basis have been used for long-term investment.

(xviii)During the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act

(xix) The Company has not issued any debentures during the year

(xx) The Company has not raised any money through a public issue during the year

(xxi) During the course of our examination of the books and records of the company'' carried in accordance with the auditing standards generally accepted in India'' we have neither come across any instance of fraud on or by the Company noticed or reported during the course of our audit nor have been informed of any such instance by the Management

For Khimji Kunverji & Co

Chartered Accountants

Firm Registration No 105146W

Place: Mumbai Hasmukh B Dedhia

Date: May 08'' 2013 (Partner) F-033494


Mar 31, 2012

1 We have audited the attached Balance Sheet of Aditya Birla Chemicals (India) Limited (here-in-after referred to as '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 (here-in-after referred to as "the Order") issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, (here-in-after referred to as "the Act") 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 it appears from our examination of those books;

iii 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;

iv In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the applicable accounting standards referred to in section 211 (3C) of the Act;

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

vi In our opinion and to the best of our information and according to the explanations given to us, they said accounts 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, 2012 ;

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

c in the case of Cash Flow statement, of the cash flows of the Company for the year ended on that date Annexure referred to in paragraph 3 of our Auditor's Report of Aditya Birla Chemicals (India) Limited of even date

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

(b) The Company has a program for phased physical verification of all its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification

(c) The Company has not disposed off substantial part of its fixed assets during the year

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year

(b) The procedure 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 and no material discrepancies were noticed on physical verification

(iii) The Company has neither taken for granted any Loans, secured or unsecured from/ to companies, firms or other parties covered in the register maintained under section 301 of the Act. Accordingly, clause (iii)(b) to (iii)(g) of paragraph 4 of the order are not applicable to company for the year

(iv) In our opinion and according to the information and explanations given, there is 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 examination of the books and records of the Company and according to the information and explanations given, and as per checking carried out in accordance with the auditing standards generally accepted in India, neither we have observed nor have we been reported of any continuing failure to correct major weakness in the internal control system relating to these areas

(v) Based on the audit procedures applied and according to the information and explanations given, there are no contracts or arrangements referred to in section 301 of the Act that need to be entered in the register maintained under that section. Hence clause (v)(b) of para 4 of the Order is not applicable

(vi) The Company has not accepted any deposits from public to which the provisions of sections 58A, 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the Public applies

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

(viii) We have broadly reviewed the accounts and records 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 Act and are of the opinion that, prima facie, the prescribed accounts and records have been maintained

(ix) (a) The Company is generally regular in depositing with appropriate authorities 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 material statutory dues applicable to it. There were no arrears as at March 31, 2012 for a period exceeding six months from the date they became payable

(b) According to the information and explanations given, there are no dues of sales-tax, income- tax, wealth-tax, service tax, custom duty, excise duty and cess, which have not been deposited on account of any dispute except as follows:

Name of the Nature of dues Period Amount Forum where Statute (Rs. in lacs) Dispute is pending

Income Tax Act 1961 Income tax and AY 1998-99 & 3.83 Referred to AO by Interest 2000-01 ITAT Ranchi

AY 2002-03 & 5.10 CIT (Appeal), Ranchi 2006-07

AY 2005-06 19.80 ITAT, Ranchi

AY 2007-08 197.02 CIT (Appeals) and Petition u/s 154

AY 2008-09 & 360.66 CIT(Appeal), Ranchi 2009-10

Sales Tax / Trade Tax Sales Tax FY 1989-90, 13.79 Allahabad High Court 1990-91 & 2003-04

AY 2005-06 26.69 Office of the Joint Commissioner(A), Mirzapur

UP Tax on Entry Entry Tax FY 2006-07 to 217.52 Supreme court of Goods into FY 2011-12 Local Area Tax, 2007

Central Excise Act 1944 Cenvat and Penalty FY 1995-96, 58.64 CESTAT, New Delhi 1999-2000, 2005-06 & 2007-08

FY 1996-97 to 4.53 High Court, Allahabad FY 2000-01 FY 2000-01 to 561.00 CESTAT, New Delhi FY 2006-07 FY 2006-07 7.38 AC, Central Excise, Mirzapur

Sec 94 of Finance act 1994 Service Tax and Penalty FY 2005-06 & 164.32 CESTAT, New Delhi 2006-07

(x) The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year

(xi) Based on our audit procedures and as per the information and explanations given, we are of the opinion that the Company has not defaulted in repayment of dues to financial institution or bank

(xii) According to the information and explanations given, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities

(xiii) 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 Para 4 of the Order are not applicable to the Company

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of Para 4 of the Order are not applicable to the Company

(xv) According to the information and explanations given, the Company has not given any guarantee for loans taken by others from banks or financial institutions

(xvi) Based on information and explanations given to us, the term loans were applied by the Company during the year for the purposes for which the loans were obtained

(xvii) According to the information and explanations given and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long- term investment

(xviii) During the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act

(xix) The Company has not issued any debentures during the year

(xx) The Company has not raised any money through a public issue during the year

(xxi) During the course of our examination of the books and records of the company, carried in accordance with the auditing standards generally accepted in India, we have neither come across any instance of fraud on or by the Company noticed or reported during the course of our audit nor have been informed of any such instance by the Management

For and on behalf of

Khimji Kunverji & Co.

Chartered Accountants

Firm Registration No. 105146W

Dated : May 11, 2012 Hasmukh B Dedhia

Place : Mumbai Partner (F-033494)

 
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