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Auditor Report of Anil Ltd.

Mar 31, 2016

INDEPENDENT AUDITORS’ REPORT

To

The Members of ANIL LIMITED,

Report on the Standalone Financial Statements

We have audited the accompanying Standalone Financial Statements of ANIL LIMITED (“the Company”) which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss and the Cash flow statement for the year ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

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

Our responsibility is to express an opinion on these Standalone Financial Statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made 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 Standalone Financial Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Standalone Financial Statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Standalone 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 Standalone Financial Statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the Financial Statements.

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

Opinion

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

Emphasis of Matters

1. Attention is invited to Note 39 of the Standalone Financial Statements which states that the balance confirmation from the suppliers, customers as well as to various loans or advances given have been called for, but the same are awaited till date. In view of the same, it is to be stated that the balances of receivables, trade payables as well as loans and advances have been taken as per the books of accounts submitted by the company and are subject to confirmation from the respective parties.

Our opinion is not qualified on the above matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report), Order, 2016(“the Order”), issued by the Central Government of India in terms of section 143(11) of section the Act, we give in the Annexure “A” statement on the matters specified in the paragraph 3 and 4 of the Order.

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

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

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

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

d) The matter described under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company

e) in our opinion, the aforesaid Standalone Financial Statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in “Annexure B” and

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

I. The Company has disclosed the impact of pending litigations on its financial position in its financial statements as referred to in Note no.27 to the financial statements;

II. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses and

III. During the year, there has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the company.

The Annexure referred to in Independent Auditors'' Report to the members of the Company on the financial statements for the year ended 31 March 2016, we report that:

i) (a) The Company is in the process of updating its Fixed Assets records to show full particulars, including quantitative details and situation of fixed assets. In view of pending updating, we are unable to comment about full particulars of Fixed Assets, quantitative details and Situation of Fixed assets.

(b) According to the information and explanations given to us, the fixed assets are verified by the management, during the year in a phased periodical manner which, in our opinion is reasonable having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are in the name of the Company.

ii) As explained to us, the inventories have been physically verified by the management at reasonable intervals during the year. The discrepancies noticed on verification between physical stocks and the books of accounts are not material.

iii) (a) The Company has granted unsecured loans to two body corporate [i.e. 100% subsidiary companies] covered in the register maintained under section 189 of the Companies Act,2013 (“The Act”):

(b) i. In our opinion, the rate of interest &other terms and conditions on which the loan had been granted to the one of the body corporate (M/s Anil Mega Food Park P Ltd, a 100% subsidiary) listed in the register Maintained under section 189 of the Act, were not, Prima Facie, Prejudicial to the interest of the Company.

ii. The Loan granted during the earlier year to the party i. e. (Anil Life Science Ltd, a 100% subsidiary) covered in the register maintained under section 189 of the Companies Act, 2013 (the Act) is interest free.

iii. The terms of arrangements do not stipulate any repayment schedule and the loan is repayable on demand. Accordingly, Paragraph 3(iii)(b) of the order is not applicable.

(c) In respect of said loans, there is no overdue amounts.

iv) On the basis of information and explanation given to us, the company has broadly complied with the provisions of section 185 and 186 with respect to the investment made, loans granted and guarantee given except for the interest free loan granted to M/S Anil Life science Ltd, 100% subsidiary company, and thus, the provisions of Section 186(7) are not complied with.

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

vi) As explained to us, the Central Government has not prescribed the maintenance of Cost records under subsection (1) of Section 148 of the Act.

vii) a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Employees State Insurance, provident fund, income-tax, sales tax, value added tax, duty of customs, duty of excise, service tax, cess and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income tax, sales tax, value added tax, duty of customs, duty of excise, service tax, cess and other material statutory dues were in arrears as at 31st March 2016 for a period of more than six months from the date they became payable except Tax on Dividend of Rs 102.95 Lakhs outstanding for a period of more than Six months.

b) According to the information and explanations given to us, there are no material dues of service tax which have not been deposited with the appropriate authorities on account of any dispute, However ,according to information and explanations given to us, the following dues of Sales Tax , Income Tax, Duty of Customs and Duty of Excise have not been deposited by the company on account of Dispute:

Statue

Nature of the Dues

Financial Year to which the matter relates

Forum where

the matter is pending

Amount (Rs in Lakhs) (Net of payment)

GUJARAT SALES TAX ACT

a)

Sales Tax Demand

1994 to 1997

Gujarat High Court

49.84

CENTRAL EXCISE ACT,1944

a)

Excise demand for Product Classification

01/04/1998 to 29/02/2000

Customs Excise and Service Tax Appellate Tribunal, Ahmadabad

147.91

b)

Excise demand for Product Classification

01/08/1996 to 30/06/1997

Supreme Court, New Delhi

9.61

c)

Excise demand for Product Classification

August 2004 to January 2012

Commissioner Office, Ahmadabad

4881.41

d)

Excise demand for Cenvat Credit reversal of Capital Goods

Year 2010-11 to 2012-13

(Upto Nov., 2012)

Customs Excise and Service Tax Appellate Tribunal, Ahmadabad

127.09

Statue

Nature of the Dues

Financial Year to which the matter relates

Forum where

the matter is pending

Amount (Rs in Lakhs) (Net of payment)

CUSTOMS ACT, 1962

a)

Custom Duty Demand

August 2012 to January 2013

Customs Excise and Service Tax Appellate Tribunal, Ahmadabad

74.20

INCOME TAX ACT,1961

a)

Income Tax Demand

2007-08

CIT (Appeal) -VI, Ahmadabad

15.31

b)

Income Tax Demand

2008-09

Income Tax Appellate Tribunal Ahmadabad, Bench A

58.87

c)

Income Tax Demand

2009-10

CIT (Appeal) -VI, Ahmadabad

142.90

d)

Income Tax Demand

2010-11

CIT (Appeal) -VI, Ahmadabad

567.64

e)

Income Tax Demand

2011-12

CIT (Appeal) -VI, Ahmadabad

830.04

viii) According to information & explanations given to us, the company has except for few instances of delay of Interest of Rs 1577.42 Lakhs Ranging From 2 to 46 days & Installment of Rs 779.45 Lakhs Ranging from 26 to 48 days in respect of few of the Banks the Company has generally not defaulted in repayment of its dues to Banks or Financial institutions. The company does not have any borrowings from debenture holders or Government.

ix) According to the information & explanations given to us, the Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year under review. However, the term loans raised during the year has been generally applied for the purpose for which they were raised except loan of Rs.45 Cr raised from IFCI Ltd which was not utilized for purpose for which it was raised.

x) According to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the 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 the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

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

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

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

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

We have audited the internal financial controls over financial reporting of M/s ANIL LIMITED (“the Company”) as at 31 March 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date. Management’s Responsibility for Internal Financial Controls

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

Auditor’s’ Responsibility

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

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

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

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

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

For Parikh & Majmudar

Chartered Accountants FR No. 107525W

[C.A (Dr) Hiten M. Parikh] PARTNER

Place : Ahmedabad Membership No. 40230

Date : 19th May, 2016


Mar 31, 2015

We have audited the accompanying standalone financial statements of ANIL LIMITED ('the Company") which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss and the Cash flow statement for the year ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

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

Auditor's Responsibility

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

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2015 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, 2015("the Order), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

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

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

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

b. 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;

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

d. 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) the Act;

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

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements as referred to in Note no.27 to the financial statements;

ii. the Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses and

iii. Except for two Instances of Delay i.e 156 days for an Amount Rs 1.85 lacs and 1 Day for an Amount of Rs 0.25 lacs required to be transferred, to the Investor Education and Protection Fund by the Company, there were no other delay in transferring the amount required to be transferred, to the Investor Education and Protection Fund by the Company.

ANNEXURE TO INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 1 under 'Report on other Legal and Regulatory Requirements' section of our Report on even Date)

i) (a) The company is in the process of updating its fixed asset records to show full particulars including quantitative details and situation of fixed assets.

(b) As explained to us, the company has a regular programme of physical verification of its fixed assets by which all the fixed assets are verified in a phased manner over a period of three years. In the absence of updated fixed assets records, discrepancies, if any, noticed on such physical verification could not be ascertained.

ii) (a) As informed to us, Physical verification of inventory has been conducted during the year by the management at reasonable intervals.

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

(c) On the basis of our examination of the records of the company, we are of the opinion that the company is maintaining proper records of inventory. The discrepancies noticed on verification between physical stocks and the books of accounts were not material.

iii) The Company has granted unsecured loans to one body corporate [i.e. 100% subsidiary company] covered in the register maintained under section 189 of the Companies Act,2013 ("The Act"):

(a) In respect of the loans granted, the terms of the arrangement do not stipulate any repayment schedule and the loans are repayable on demand, and the said loans are interest free.

(b) There is no overdue amount of more than rupees one lakh in respect of the loans granted to the bodies corporate listed in the register maintained under section 189 of the Act.

iv) In our opinion & according to the information & explanations given to us, there is an adequate internal control system commensurate with the size of the company & nature of its business for the purchase of inventory, fixed assets & also for the sale of goods and services. We have not observed any major weakness in internal control systems during the course of our audit.

v) In our opinion the company has not accepted any deposits during the year. Hence, the provisions of section 73 to 76 or any other relevant provisions of the companies Act and the Companies (Acceptance of Deposits) Rules, 2014 with regard to the deposits accepted are not applicable to the company. Therefore, provisions of clause (v) of paragraph 3 of the Order are not applicable to the company. According to information and explanation given to us, no order has been passed by Company Law Board or National Company Law Tribunal or Reserve bank of India or any other court or any other Tribunal.

vi) As explained to us, the Central Government has not specified maintenance of the Cost records under sub-section (1) of Section 148 of the Act.

vii) (a) According to the records of the company, Undisputed Statutory dues including Provident fund, Employees' State Insurance, Income-tax, Wealth-tax, Service Tax, Value Added Tax, Duty of Customs, Duty of Excise, Cess & other Statutory dues have been generally regularly deposited during the year with the appropriate authorities. According to the information and explanation given to us, no undisputed amounts were outstanding as at 31st March, 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no material dues of Wealth Tax, Service Tax and Cess which have not been deposited with the appropriate authorities on account of any dispute, However, according to the information and explanation given to us, the following dues of Sales Tax, Duty of Excise, Duty of Customs & Income Tax have not been deposited by the company on account of dispute as on 31st March, 2015 are as under.

Statue Nature of the Dues Financial Year to which Forum where the matter relates the matter is pending

GUJARAT SALES TAX ACT,

a) Sales Tax Demand 1994 to 1997 Gujarat High Court

CENTRAL EXCISE ACT,1944

a) Excise demand for 01/04/1998 to Customs Excise and Product Classification 29/02/2000 Service Tax Appellate Tribunal, Ahmedabad

b) Excise demand for 01/09/1996 to Customs Excise and Product Classification 31/05/1997 Service Tax Appellate Tribunal, Ahmedabad

c) Excise demand for August 2004 to Customs Excise and Product Classification January 2012 Service Tax Appellate Tribunal, Ahmedabad

d) Excise demand for Year 2010-11 Customs Excise and Cenvat Credit reversal to 2012-13 Service Tax of Capital Goods (Upto Nov., 2012) Appellate Tribunal, Ahmedabad

Statue Nature of the Dues Amount (Rs in Lacs) (Net of payment)

GUJARAT SALES TAX ACT,

a) Sales Tax Demand 49.84

CENTRAL EXCISE ACT,1944

a) Excise demand for Product Classification 147.91

b) Excise demand for Product Classification 9.61

c) Excise demand for Product Classification 4881.41

d) Excise demand for 127.09 Cenvat Credit reversal of Capital Goods

Statue Nature of the Dues Financial Year to which Forum where the matter relates the matter is pending (Net of payment)

CUSTOMS ACT, 1962

a) Custom Duty Demand August 2012 to Customs Excise and January 2013 Service Tax Appellate Tribunal, Ahmedabad

Income Tax Act,1961

a) Income Tax Demand 2003-04 Income Tax Appellate Tribunal, Ahmedabad

b) Income Tax Demand 2006-07 Income Tax Appellate Tribunal, Ahmedabad

c) Income Tax Demand 2007-08 CIT (Appeal)-VI, Ahmedabad

d) Income Tax Demand 2008-09 CIT (Appeal) -VI, Ahmedabad

e) Income Tax Demand 2009-10 CIT (Appeal) -VI, Ahmedabad

f) Income Tax Demand 2010-11 CIT (Appeal) -VI, Ahmedabad

g) Income Tax Demand 2011-12 CIT (Appeal)-VI, Ahmedabad

Statue Nature of the Dues Amount (Rs in Lacs)

CUSTOMS ACT, 1962

a) Custom Duty Demand 74.20

Income Tax Act,1961

a) Income Tax Demand 5.12

b) Income Tax Demand 6.59

c) Income Tax Demand 15.31

d) Income Tax Demand 58.87

e) Income Tax Demand 317.91

f) Income Tax Demand 642.64

g) Income Tax Demand 880.04

(c) Except for two Instances of Delay i.e 156 days for an Amount of Rs 1.85 lacs and 1 Day for an Amount of Rs. 0.25 lacs required to be transferred, to the Investor Education and Protection Fund by the Company, there were no other delay in transferring the amount required to be transferred, to the Investor Education and Protection Fund by the Company in accordance with the provisions of the Companies Act, 1956 and the rules made there under

viii) The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the financial year under question and in the immediately preceding financial year.

ix) According to information & explanations given to us, the company has generally not defaulted in repayment of dues to Banks or Financial Institution or debenture holders.

x) According to the information and explanations given to us, the terms and conditions on which the company has given guarantee for loans taken by others from banks are prima facie not prejudicial to the interest of the company.

xi) According to the information & explanations given to us, the term loans have been applied for the purpose for which they were raised.

xii) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For Parikh & Majmudar Chartered Accountants FRNNO 107525W (CA Dr. Hiten Parikh) Place : Ahmedabad Partner Date : 29/05/2015 M. No. 40230


Mar 31, 2014

We have audited the accompanying financial statements of ANIL LIMITED ("the Company") which comprise the Balance Sheet as at March 31, 2014, the Statement of Profit and Loss and the Cash flow statement for the year 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 and financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with 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 presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of Company''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 flow 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"), as amended, issued by the Central Government of India in terms of sub-section(4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

c. the Balance Sheet, Statement of Profit and Loss 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 notified under the Companies Act, 1956 ("the Act") read with 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, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

(Referred to in Paragraph 1 under "Report on other Legal & Regularory Requirements section of report on Even Date")

i) (a) The company is in the process of updating its fixed asset records to show full particulars including quantitative details and situation of fixed assets.

(b) The company has a regular programme of physical verification of its fixed assets by which all the fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the company and nature of its fixed assets. The company is in the process of carrying out physical verification of fixed assets for the current year. Since the company is in the process of compiling its fixed asset records to show full particulars including quantitative details and situation of its fixed assets, complete reconciliation between book records and physical assets is not possible. In the absence of updated fixed assets records, discrepancies, if any, could not be ascertained.

(c) According to the information and explanation given to us, the company has not disposed of its fixed assets during the year and hence the question of affecting the going concern assumption does not arise.

ii) (a) As informed to us, Physical verification of inventory has been conducted during the year by the management at reasonable intervals. In our opinion, the frequency of verification is reasonable.

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

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory. As explained to us, the discrepancies noticed on physical verification of inventory were properly dealt with in the books of accounts.

iii) In respect of secured or unsecured loans, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

(a) During the year, the company has not taken any new loan from parties covered in the register maintained u/s 301 of the Companies Act, 1956. However the company had earlier taken loan from one party covered under the register maintained u/s 301 ( maximum amount involved during the year was Rs. 44.78 Lacs and the year end balance from the said party was Rs. 44.78 Lacs.)

(b) In our opinion and according to the information and explanation given to us, the loan is interest free and other terms and conditions of the unsecured loans taken by the company from the party covered in the register maintained under section 301 of the Companies Act, 1956 are prima facie not prejudicial to the interest of the company.

(c) As regards loans taken by the company, terms of repayment of principal amount have not been stipulated. Hence the question of overdue amount does not arise.

(d) There is one party covered under the register maintained under section 301 of the Companies Act, 1956 to whom the company has granted unsecured Loan and the maximum amount involved during the year was Rs. 2533.43 Lacs and year end balance of loan granted to such party was Rs. 2533.43 Lacs.

(e) As explained to us, the Loan is granted as interest free. Other terms and conditions on which the Loan have been granted to a company covered under register maintained under section 301 of the Companies Act, 1956 are not prima-facie prejudicial to the interest of the company. In respect of Loan granted by the company, the principal amount is repayable on demand.

iv) In our opinion & according to the information & explanations given to us, there are adequate internal control system commensurate with the size of the company & nature of its business for the purchase of inventory, fixed assets & also for the 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.

v) (a) In our opinion and according to the information & explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under section 301 of the Companies Act, 1956.

(b) In our opinion, and according to information and explanation given to us, the transactions of purchase of goods & materials, sales of goods, materials, fixed assets & services made in pursuance of contract or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year Rs. 5.00 Lacs or more in respect of such parties have been made at prices which are reasonable having regard to the prevailing market price for such goods, materials, fixed assets & services or the price at which the transactions for similar goods, materials, fixed assets & services have been made with other parties.

vi) In our opinion and according to information & explanation given to us, company has complied with the directives issued by the Reserve Bank of India and provisions of Section 58A and 58AA of the Companies Act ,1956 and the rules framed thereunder with regard to the deposits accepted from the public.

vii) In our opinion, the internal audit functions carried out during the year, by a firm of Chartered Accountants, appointed by the management have been commensurate with the size of the company and nature of its business.

viii) We have broadly reviewed the books of accounts maintained by the company in respect of products where pursuance to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under section 209(1) clause (d) of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have however not made a detail examination of the records with a view to determine whether they are accurate or complete.

ix) (a) According to the records maintained by the company, the undisputed Statutory dues including provident fund, employees State Insurance, Income-tax, Wealth-tax, Service Tax, Sales-tax (VAT), Customs duties, excise duty, cess and other statutory dues have been regularly deposited during the year with the appropriate authorities. On the basis of records produced before us for our verification and according to the information & explanation given to us, no undisputed amount payable in respect of afore said dues were in arrears as at 31st March, 2014 for a period of more than six months from the date they became payable.

(b) On the basis of records produced before us for our verification and according to the information and explanations given to us, the details of disputed Sales Tax, Central Excise duty & Income Tax dues aggregating to Rs. 6180.4 lacs (net of Payments) that have not been deposited as on 31st March, 2014 on account of matters pending before appropriate authorities, are as under.

x) The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the financial year under question and in the immediately preceding financial year.

xi) According to information & explanations given to us, the company has generally not defaulted in repayment of dues to Financial Institutions or Banks.

xii) In our opinion & according to the information & explanation given to us, no loans & advances have been granted by the company on the basis of security by way of pledge of shares, debentures & 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 the Companies (Auditor''s Report) Order, 2003, are not applicable to the company.

xiv) According to the information & explanations given to us, the company is not dealing or trading in shares, securities debentures & other investments. Therefore, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003, are not applicable to the company

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

xvi) According to the Information & explanations given to us, the term loan raised during the year has been applied for the purpose for which the said is raised.

xvii) According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company and after placing reliance on the reasonable assumptions made by the company, there are no funds raised on short term basis, which have been used for long term purpose.

xviii)The Company has not made any Preferential allotment of shares during the year under review.

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

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

xxi) In our Opinion and According to the information & explanations given to us, no fraud on or by the company has been noticed or reported during the course of our Audit.

For Parikh & Majmudar Chartered Accountants FR No. 107525W

[C.A (Dr) Hiten M. Parikh] Place : Ahmedabad PARTNER Date : 28th May, 2014 Membership No. 40230


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of ANIL LIMITED (the Company'') which compris e the Balance Sheet as at March 31, 2013, the Statement of Profit and Loss and the Cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management'' 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 responsi bility 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'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of th e 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 Companys 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 (Auditors Report), Order, 2003(the Order''), as amended, issued by the Central Government of India in terms of sub-section(4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

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

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 Companies Act, 1956.

ANNEXURE TO THE AUDITORS'' REPORT (The Annexure referred to in our report to the members of ANIL LIMITED. (The Company") for the year ended on 3fMarch, 2013, We report that;

i) (a) The company has maintained proper records showing full particulars, including situation of its fixed assets.

The quantity details are being updated.

(b) As explained to us, the Company has designed a phased program of verification of fixed assets to cover all the items over a period of two years which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, some part of fixed assets was physically verified by the management during the year. According to information, and explanations given to us, no material discrepancies were noticed by the management on such verification.

(c) According to the information and explanation given to us, the company has not disposed off a substantial part of its fixed assets during the year and the going concern status of the company is not affected

ii) (a) Physical verification of inventory has been conducted during the year by the management at reasonable intervals, In our opinion, the frequency of verification is reasonable.

(b) In our opinion & according to the informati on & explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable & adequate in relation to the size of the company & nature of its business.

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory. As explained to us, the discrepancies noticed on physical verification of inventory were properly dealt with in the books of accounts.

iii) In respect of loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(a) During the year, the company has not taken any new loan from parties covered in the register maintained u/ s 301 of the Companies Act, 1956. However the company had taken loan from one party earlier covered under the register maintained u/s 301 ( maximum amount involved during the year was Rs. 81.28 Lacs and the year end balance from the said party was Rs. 81.28 Lacs.)

(b) In our opinion and according to the information and explanation given to us, the terms and conditions of the unsecured loans taken by the company from the party covered in the register maintained under section 301 of the Companies Act, 1956 are prima facie not prejudicial to the interest of the company.

(c) As regards loans taken by the company terms of repayment have not been stipulated and hence the question of any overdue amount does not arise

(d) The company has not granted Unsecured Loan to any party covered under register maintained u/s 301 of the Companies Act, 1956.

iv) In our opinion & according to the information & explanations given to us, there are adequate internal control systems commensurate with the size of the company & nature of its business for the purchase of inventory, fixed assets & also for the sales of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls systems.

v) (a) In our opinion and according to the information & explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under section 301 of the Companies Act, 1956

(b) In our opinion, and according to information and explanation given to us, the transactions of purchase of goods & materials, sales of goods, materials, fixed assets & services made in pursuance of contract or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year Rs. 5.00 Lacs or more in respect of such parties have been made at prices which are reasonable having regard to the prevailing market prices for such goods, materials, fixed assets & services or the prices at which the transactions for similar goods, materials, fixed assets & services have been made with other parties.

vi) In our opinion and according to information & explanation given to us, company has complied with the directives issued by the Reserve Bank of India and provisions of Section 58A and 58AA of the Companies Act ,1956 and the rules framed there under with regard to the deposits accepted from the public.

vii) The Company has appointed a firm of Chartered Accountants for Internal Audit. In our opinion, the internal audit is commensurate with its size & nature of its business.

viii) We have broadly reviewed the books of accounts maintained by the company in respect of products where pursuance to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under section 209(1) clause (d) of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have however not made a detail examination of the records with a view to determine whether they are accurate or complete.

ix) (a) According to the records maintained by the company, the undisputed Statutory dues including provident fund, employees State Insurance, Income-tax, Wealth-tax, Service Tax, Sales-tax Customs duties, excise duty, cess and other statutory dues have been regularly deposited during the year with the appropriate authorities. On the basis of records produced before us for our verification and according to the information & explanation given to us, no undisputed amount payable in respect of afore said dues were in arrears as at 31st March, 2013 for a period of more than six months from the date they became payable.

(b) On the basis of records produced before us for our verification and according to the information and explanations given to us, the details of disputed, Sales Tax, Central Excise duty & Income Tax dues aggregating to Rs. 2418.03 lacs that have not been deposited as on 31st March, 2013 on account of matters pending before appropriate authorities, the details of which are as under.

Sr. Nature of the dues Financial Year Forum where Amount to which the the matter is pending (Rs. in Lacs) matter relates

1 SALES TAX

a) Sales Tax Demand 1994-1997 Gujarat High Court 47.23

2 CENTRAL EXCISE DUTY

a) Excise demand for product 01.04.1998 to Customs Excise and Service Tax 147.91 classification 29.02.2000 Appellate Tribunal, Ahmedabad

b) Excise demand for product 01.09.1996 to Customs Excise and Service Tax 9.61 classification 31.05.1997 Appellate Tribunal, Ahmedabad

c) Excise demand for Product August 1999 to Gujarat High Court 1470.03 Classification June 2004

d) Excise demand on CENVAT January 2009 to Customs Excise and Service Tax 20.01 Reversal on Exempted Goods December 2009 Appellate Tribunal, Ahmedabad

e) Excise Demand on CENVAT 01.04.2005 to Commissioner of Central Excise, 131.84 Reversal on Exempted Goods 31.12.2009 Ahmedabad and non maintenance of Separate account for Exempted final products

3 INCOME TAX

a) Income Tax Demand 2002-03 Dy. Commissioner of Income Tax 0.24 (OSD) - Range 1

b) Income Tax Demand 2003-04 Income Tax Appellate Tribunal, 5.12 Ahmedabad

c) Income Tax Demand 2006-07 Income Tax Appellate Tribunal, 6.59 Ahmedabad

d) Income Tax Demand 2007-08 CIT (Appeal) -VI, Ahmedabad 27.67

e) Income Tax Demand 2008-09 CIT (Appeal) -VI, Ahmedabad 58.87

f) Income Tax Demand 2009-10 CIT (Appeal) -VI, Ahmedabad 492.91

x) The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the financial year under question and in the immediately preceding financial year.

xi) According to information & explanation given to us, and on the basis of written confirmation received from some of the banks, the company has generally not defaulted in repayment of dues to Banks or financial institutes.

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

xiii) In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund/ society.

xiv) According to the information & explanations given to us, the company is not dealing or trading in shares, securities debentures & other investments.

xv) In our opinion, the terms & conditions on which the company has given guarantee for loans taken by others from Banks or financial institutions are prima facie, not prejudicial to the interest of the company.

xvi) According to the Information & explanations given to us, the term loan raised during the year has been applied for the purpose for which the said is raised .

xvii) According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company and after placing reliance on the reasonable assumptions made by the company, there are no funds raised on short term basis, which have been used for long term purpose.

xviii) The Company has not made any Preferential allotment of shares during the year under review.

xix) As explained to us, the company has not created any security in respect of debentures issued during the year.

xx) The company has not raised any money by way of public issue during the year.

xxi) According to the information & explanations given to us, no fraud on or by the company has been noticed or reported during the course of our Audit.

For PARIKH & MAJMUDAR

Chartered Accountants

FRN No. 107525W

[CA. Dr. HITEN PARIKH]

Place : Ahmedabad Partner

Date : 10.05.2013 Membership No. 040230


Mar 31, 2012

1) We have audited the attached Balance Sheet of M/s ANIL LIMITED as at 31st March 2012, the Profit and Loss A/c and also 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 & 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 & disclosures in the financial statements. An audit also includes assessing the accounting principles used & 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) order2003 and the Companies (Auditors Report) (Amendment) Order,2004 issued by the Central Government of India in terms of sub-section(4A) of Section 227 of the companies Act 1956, we annex here to a statement on the matters specified in paragraphs 4 &5 of the said order to the extent applicable.

4) Further to our comments in the Annexure referred to in paragraph-3 above, we report as under: -

(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 and the Profit and Loss Account & Cash flow statement dealt with by this report are in agreement with the books of account.

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

(e) 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 of the company are disqualified as on March, 31 2012 from being appointed as director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts 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. :-

i) In the case of the Balance Sheet of the state of affairs of the Company as at 31st March, 2012

ii) In the case of the profit and loss account, of the Profit of the company for the year ended on that date and

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

ANNEXURETOTHE AUDITORS' REPORT (Referred to in paragraph 3 of our report of even date)

i) (a) The company has maintained proper records showing full particulars, including situation of its fixed assets.

The quantity details are being updated.

(b) As explained to us, the Company has designed a phased program of verification of fixed assets to cover all the items over a period of two years which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, some part of fixed assets was physically verified by the management during the year. According to information, and explanations given to us, no material discrepancies were noticed by the management on such verification.

(c) According to the information and explanation given to us, the company has not disposed off a substantial part of its fixed assets during the year and the going concern status of the company is not affected

ii) (a) Physical verification of inventory has been conducted during the year by the management at reasonable

intervals, In our opinion, the frequency of verification is reasonable.

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

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory. As explained to us, the discrepancies noticed on physical verification of inventory were properly dealt with in the books of accounts.

iii) In respect of loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(a) During the year, the company has not taken any new loan from parties covered in the register maintained u/s 301 of the Companies Act, 1956. However the company had taken loan from two parties earlier covered under the register maintained u/s 301 out of which Rs. 0.08 lacs have been repaid during the year (maximum amount involved during the year was Rs. 80.31 Lacs and the year end balance from the said parties was Rs. 80.23 Lacs.)

(b) In our opinion and according to the information and explanation given to us, the terms and conditions of the unsecured loans taken by the company from the party covered in the register maintained under section 301 of the Companies Act, 1956 are prima facie not prejudicial to the interest of the company.

(c) As regards loans taken by the company terms of repayment have not been stipulated and hence the question of any overdue amount does not arise

(d) The company has not granted Unsecured Loan to any party covered under register maintained u/s 301 of the Companies Act, 1956.

iv) In our opinion & according to the information & explanations given to us, there are adequate internal control systems commensurate with the size of the company & nature of its business for the purchase of inventory, fixed assets & also for the sales of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls systems.

v) (a) In our opinion and according to the information & explanations given to us, the particulars of contracts or

arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under section 301 of the Companies Act, 1956

(b) In our opinion, and according to information and explanation given to us, the transactions of purchase of goods & materials, sales of goods, materials, fixed assets & services made in pursuance of contract or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the yearRs. 5.00 Lacs or more in respect of such parties have been made at prices which are reasonable having regard to the prevailing market prices for such goods, materials, fixed assets & services or the prices at which the transactions for similar goods, materials, fixed assets & services have been made with other parties.

vi) In our opinion and according to information & explanation given to us, company has complied with the directives issued by the Reserve Bank of India and provisions of Section 58A and 58AA of the Companies Act ,1956 and the rules framed there under with regard to the deposits accepted from the public.

vii) The Company has appointed a firm of Chartered Accountants for Internal Audit. In our opinion, the internal audit is commensurate with its size & nature of its business.

viii) We have broadly reviewed the books of accounts maintained by the company in respect of products where pursuance to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under section 209(1) clause (d) of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have however not made a detail examination of the records with a view to determine whether they are accurate or complete.

ix) (a) According to the records maintained by the company, the undisputed Statutory dues including provident

fund, employees State Insurance, Income-tax, Wealth-tax, Service Tax, Sales-tax Customs duties, excise duty, cess and other statutory dues have been regularly deposited during the year with the appropriate authorities. On the basis of records produced before us for our verification and according to the information

& explanation given to us, no undisputed amount payable in respect of afore said dues were in arrears as at 31st March, 2012 for a period of more than six months from the date they became payable.

(b) On the basis of records produced before us for our verification and according to the information and explanations given to us, the details of disputed, Sales Tax, Central Excise duty & Income Tax dues aggregating to Rs. 423.85 lacs that have not been deposited as on 31st March, 2012 on account of matters pending before appropriate authorities, the details of which are as under.

Sr. Nature of the dues Financial Year Forum where Amount to which the the matter is pending (in Lacs) matter relates

1 SALES TAX

a) Sales Tax Demand 1994-1997 Gujarat High Court 47.23

2 CENTRAL EXCISE DUTY

a) Excise demand for product 01.04.1998 to Customs Excise and Service Tax 147.91 classification 29.02.2000 Appellate Tribunal, Ahmedabad

b) Excise demand for product 01.09.1996 to Customs Excise and Service Tax 9.61 classification 31.05.1997 Appellate Tribunal, Ahmedabad

c) Excise demand for Product August 1999 to Gujarat High Court 14.70 Classification June 2004

d) Excise demand on CENVAT January 2009 to Customs Excise and Service Tax 20.01 Reversal on Exempted Goods December 2009 Appellate Tribunal, Ahmedabad

e)Excise Demand on CENVAT December 2008 to Commissioner of Central Excise, 6.16 Reversal on Exempted Goods February 2009 Ahmedabad

f Excise Demand on CENVAT 01/04/2005 to Commissioner of Central Excise, 131.84 Reversal on Exempted Goods 31/12/2009 Ahmedabad

and non maintenance of Separate account for Exempted final products

3 INCOME TAX

a) Income Tax Demand 2002-03 Dy. Commissioner of Income Tax 0.24 (OSD) - Range 1

b) Income Tax Demand 2003-04 Income Tax Appellate Tribunal, 5.12 Ahmedabad

c) Income Tax Demand 2004-05 Income Tax Appellate Tribunal, 0.19 Ahmedabad

d) Income Tax Demand 2005-06 CIT (Appeal) -VI, Ahmedabad 6.58 e) Income Tax Demand 2006-07 Income Tax Appellate Tribunal, 6.59 Ahmedabad

f) Income Tax Demand 2007-08 CIT (Appeal) -VI ,Ahmedabad 27.67

x) The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the financial year under question and in the immediately preceding financial year.

xi) According to information & explanations given to us, the company has generally not defaulted in repayment of dues to Financial Institutions or Banks.

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

xiii) In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund/ society.

xiv) According to the information & explanations given to us, the company is not dealing or trading in shares, securities debentures & other investments.

xv) In our opinion, the terms & conditions on which the company has given guarantee for loans taken by others from Banks or financial institutions are prima facie, not prejudicial to the interest of the company.

xvi) According to the Information & explanations given to us, the company has not raised any new term loans during the year.

xvii) According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company and after placing reliance on the reasonable assumptions made by the company, there are no funds raised on short term basis, which have been used for long term purpose.

xviii) The Company has not made any Preferential allotment of shares during the year under review.

xix) As explained to us, the company has not created any security in respect of debentures issued during the year.

xx) The company has not raised any money by way of public issue during the year.

xxi) According to the information & explanations given to us, no fraud on or by the company has been noticed or reported during the course of our Audit.

For PARIKH & MAJMUDAR Chartered Accountants

[Dr. HITEN PARIKH]

Place : Ahmedabad Partner

Date : 22.05.2012 Membership No. 040230

FRN No. 107525W


Mar 31, 2011

1) We have audited the attached Balance Sheet of M/s ANIL LIMITED ( Formerly Known as ANIL PRODUCTS LIMITED) as at 31st March 2011, the Profit and Loss A/c and also 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 & 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 & disclosures in the financial statements. An audit also includes assessing the accounting principles used & 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 and the Companies (Auditors Report) (Amendment) Order,2004 issued by the Central Government of India in terms of sub-section(4A) of Section 227 of the companies Act 1956, we annex here to a statement on the matters specified in paragraphs 4 &5 of the said order to the extent applicable.

4) Further to our comments in the Annexure referred to in paragraph-3 above, we report as under: -

(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 and the Profit and Loss Account & Cash flow statement dealt with by this report are in agreement with the books of account.

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

(e) On the basis of the written representations received from the directors, as on March 31, 2011 and taken on record by the Board of Directors, we report that none of the directors of the company are disqualified as on March, 31 2011 from being appointed as director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(f) Attention is invited to the following notes in Schedule 20 to the Financial Statements.

i) Note no. 4 regarding non provision of doubtful debts and loans and advances of Rs. 291.10 Lacs and Rs. 80.50 Lacs respectively.

(g) Subject to above, 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. :- i) In the case of the Balance Sheet of the state of affairs of the Company as at 31st March, 2011

ii) In the case of the profit and loss account, of the Profit of the company for the year ended on that date and

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

ANNEXURE TO THE AUDITORS' REPORT (Referred to in paragraph 3 of our report of even date)

i) (a) The company has maintained proper records showing full particulars, including situation of its fixed assets. The quantity details are being updated.

(b) As explained to us, the Company has designed a phased program of verification of fixed assets to cover all the items over a period of two years which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, some part of fixed assets was physically verified by the management during the year. According to information, and explanations given to us, no material discrepancies were noticed by the management on such verification.

(c) According to the information and explanation given to us, the company has not disposed off a substantial part of its fixed assets during the year and the going concern status of the company is not affected

ii) (a) Physical verification of inventory has been conducted during the year by the management at reasonable intervals,In our opinion, the frequency of verification is reasonable.

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

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory. As explained to us, the discrepancies noticed on physical verification of inventory were properly dealt with in the books of accounts.

iii) In respect of loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(a) During the year, the company has not granted any inter corporate loan/deposit to any party covered in the register maintained u/s 301 of the Companies Act, 1956. However, the company had granted loans to three parties earlier covered under the register maintained u/s 301 of the Act out of which Rs. 1906.17 lacs have been repaid by the said parties during the year (maximum amount involved during the year was Rs. 1906.25 Lacs and the year end balance from the said party was Rs. 0.08 Lacs).

(b) In our opinion and according to the information and explanation given to us, the rate of interest & other terms and conditions of the unsecured loans taken by the company from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are prima facie not prejudicial to the interest of the company.

(c) As regards loans taken by the company terms of repayment have not been stipulated and hence the question of any overdue amount does not arise

(d) The company has not taken Unsecured Loan from any party covered under register maintained u/s 301 of the Companies Act, 1956.

iv) In our opinion & according to the information & explanations given to us, there are adequate internal control systems commensurate with the size of the company & nature of its business for the purchase of inventory, fixed assets & also for the sales of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls systems.

v) (a) In our opinion and according to the information & explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under section 301 of the Companies Act, 1956

(b) In our opinion, and according to information and explanation given to us, the transactions of purchase of goods & materials, sales of goods, materials, fixed assets & services made in pursuance of contract or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year Rs. 5.00 Lacs or more in respect of such parties have been made at prices which are reasonable having regard to the prevailing market prices for such goods, materials, fixed assets & services or the prices at which the transactions for similar goods, materials, fixed assets & services have been made with other parties.

vi) In our opinion and according to information & explanation given to us, company has complied with the directives issued by the Reserve Bank of India and provisions of Section 58A and 58AA of the Companies Act ,1956 and the rules framed there under with regard to the deposits accepted from the public.

vii) The Company has appointed a firm of Chartered Accountants for Internal Audit. In our opinion, the internal audit is commensurate with its size & nature of its business.

viii) We have broadly reviewed the books of accounts maintained by the company in respect of products where pursuance to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under section 209(1) clause (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. We have however not made a detail examination of the records with a view to determine whether they are accurate or complete.

ix) (a) According to the records maintained by the company, the undisputed Statutory dues including provident fund, employees State Insurance, Income-tax, Wealth-tax, Service Tax, Sales-tax Customs duties, excise duty, cess and other statutory dues have been regularly deposited during the year with the appropriate authorities. On the basis of records produced before us for our verification and according to the information & explanation given to us, no undisputed amount payable in respect of afore said dues were in arrears as at 31st March, 2011 for a period of more than six months from the date they became payable.

(b) On the basis of records produced before us for our verification and according to the information and explanations given to us, the details of disputed, Sales Tax, Central Excise duty & Income Tax dues aggregating to Rs. 378.33 lacs that have not been deposited as on 31st March, 2011 on account of matters pending before appropriate authorities, the details of which are as under.

Sr. Nature of the dues Financial Year Forum where Amount

to which the the matter is pending ( Rs. in Lacs) matter relates

1 SALES TAX

a) Sales Tax Demand 1994-1997 Gujarat High Court 47.23

2 CENTRAL EXCISE DUTY

a) Excise demand for product 01.04.1998 to Gujarat High Court 147.91 classifications 29.02.2000

b) Excise demand for product 01.09.1996 to Customs, Excise and Service Tax 9.61 classifications 31.05.1997 Appellate Tribunal - Ahmedabad

c) Excise demand on CENVAT 01.01.2006 to Customs, Excise and Service Tax 101.96 Reversal on Exempted Goods 31.03.2006 Appellate Tribunal - Ahmedabad

3 INCOME TAX

a) Income Tax Demand 2002-03 Dy. Commissioner of Income Tax 0.24 (OSD) - Range 1

b) Income Tax Demand 2003-04 Dy. Commissioner of Income Tax 3.37 (OSD) - Range 1

c) Income Tax Demand 2004-05 Dy. Commissioner of Income Tax 0.19 (OSD) - Range 1

d) Income Tax Demand 2005-06 CIT (Appeal) -VI, Ahmedabad 6.58

e) Income Tax Demand 2007-08 CIT (Appeal) -VI, Ahmedabad 15.31

f) Income Tax Demand 2008-09 Dy. Commissioner of Income Tax 45.93 (OSD) - Range 1

x) The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the financial year under question and in the immediately preceding financial year.

xi) According to information & explanations given to us, the company has not defaulted in repayment of dues to Financial Institutions or Banks.

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

xiii) In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund/ society.

xiv) According to the information & explanations given to us, the company is not dealing or trading in shares, securities debentures & other investments.

xv) In our opinion, the terms & conditions on which the company has given guarantee for loans taken by others from Banks or financial institutions are prima facie, not prejudicial to the interest of the company.

xvi) In our opinion and according to the Information & explanations given to us the term loans have been broadly applied for the purpose for which they were raised.

xvii) According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company and after placing reliance on the reasonable assumptions made by the company, there are no funds raised on short term basis, which have been used for long term purpose.

xviii) The Company has not made any Preferential allotment of shares during the year under review.

xix) The company has raised Unsecured Zero Coupon Convertible Debentures during the year.

xx) The company has not raised any money by way of public issue during the year.

xxi) According to the information & explanations given to us, no fraud on or by the company has been noticed or reported during the course of our Audit.

For PARIKH & MAJMUDAR

Chartered Accountants

[HITEN PARIKH]

Place : Ahmedabad Partner

Date : 12.05.2011 Membership No. 40230

FRN No. 107525W


Mar 31, 2010

1) We have audited the attached Balance Sheet of M/s ANIL products limited as at 31st March 2010, the Profit and Loss A/c and also 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 & 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 & disclosures in the financial Statements. An audit also includes assessing the accounting principles used & significant estimates made by management as well as evaluating the overall financial statement presentation, We believe that our audit provides a reasonable basis for our opinion.

3) As required by the companies (Auditors Report) order 2003 and the Companies (Auditors Report ) (Amendment) Order, 2004 issued by the Central Government of India in terms of sub-section{4A) of Section 227 of the companies Act 1958, We annex here to a statement on the matters specified in paragraphs 4 &5 of the said order to the extent applicable. .

4) Further to our comments in the Annexure referred to In paragraph-3 above, we report as under: -

(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 and the Profit and Loss Account & Cash flow statement dealt with by this report are in. agreement with the books of account.

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

(e) On the basis of the written representations received from the directors, as on March 31, 2010 and taken on record by the Board of Directors, we report that none of the directors of the company are disqualified as on March, 31 2010 from being appointed as director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(f) Attention Is invited to the following notes in Schedule £1 to the Financial Statements.

a) Note no. 4 regarding inventories of finished goods of Rs. 160.86 Lacs lying with the consignment agents as at 31st March, 2010 which inventories are subject to confirmation from the Consignment agents. These are therefore subject to necessary adjustments, if any, on receipts of such confirmations. Under the circumstances, its effects, if any, on the profit for the year and on value of the Inventories as at the balance sheet date can not be ascertained.

ii) Note no, 5 regarding non provision of doubtful debts and loans and advances of Rs 291.10 Lacs and Rs. 80.50 Lacs respectively,

(g) Subject to above, 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. :-

i) In the case of the Balance Sheet of the state of affairs of the Company as at 31st March, 2010 ii) In the case of the profit and loss account, of the Profit of the company for the year ended On that date and

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

ANNEXURE TO THE AUDITORS REPORT (Referred to in paragraph 3 of our report of even date)

i. (a) The company has maintained proper records showing full particulars, including situation of its fixed assets. The quantity details are being updated.

(b) As explained to us. the Company has designed a phased program of verification of fixed assets to cover all the items over a period of two years which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, some part of fixed assets was physically verified by the management during the year. According to information, and explanations given to us, no materia! discrepancies were noticed by the management on such verification.

(c) No Fixed Assets have been disposed off during the year and therefore do not affect the Going Concern Assumption,

ii. (a) Physical verification of inventory has been conducted during the year by the management at reasonable intervals, except for stock of finished goods lying with the consignment amounting to Rs. 160.86 lacs which is subject to confirmation. In our opinion, the frequency of verification is reasonable.

(b) In our opinion & according to the information & explanations given to US, the procedures of physical verification of inventories followed by the management are reasonable & adequate in relation to the size of the company &, nature of its business.

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory. As explained to us, the discrepancies noticed on physical verification of inventory were properly dealt with in the books gf accounts.

iii. In respect of loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(a) The company has taken Unsecured Loans from three parties covered in register maintained under section 301 of the Companies Act, 1956 during the year, [closing balance Rs. 1906.25 lacs] [Maximum balance during the year. Rs.1306.25 lacs]


(c) As regards loans taken by the company terms of repayment have not been stipulated and hence the question of any overdue amount does not arise.

(d) During the year company has not granted loan to any party covered under register maintained under Section 301 of the Companies Act, 1956. However the company has received back Rs. 3.81 lacs [Closing Balance Rs. Nil] [Maximum balance during the year Rs.3.81 lacs]

(e) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and conditions of the unsecured loan granted by the company to the parties covered in the register maintained under section 301 of the Companies Act, 1956 are prima facie not prejudicial to the interest of the company.

(f) As regards loan granted by the company, the terms of repayment have not been stipulated the principal amount of the aforesaid loan has been received back during the year and hence the question of any overdue amount does not arise.

iv. In our opinion & according to the information & explanations given to us, there are adequate internal control systems commensurate with the size of the company & nature of its business for the purchase of inventory, fixed assets & also for the sales of goods and Services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls systems.

v. (a) In our opinion and according to the information & explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under section 301 of the Companies Act, 1956

(b) In our opinion, and according to information and explanation given to us, the comparative prices of transactions of purchase of goods & materials, sales of goods, materials, fixed assets & services made in pursuance of contract or arrangements entered in the register maintained under section 301 of the Companies Act, 1958 agreegating during the year Rs. 5.00 Lacs or more in respect of such parties have been made at prices which are reasonable having regard to the prevailing market prices for such goods, materials, fixed assets & services or the prices at which the transactions for similar goods, materials, fixed assets & services have been made with other parties.

vi. In our opinion and according to information & explanation given to us, company has complied with the directives issued by the Reserve Bank of India and provisions of Section S8A and 58AA of the Companies Act,1956 and the rules framed there under with regard to the deposits accepted from the public.

vii. The Company has appointed a firm of Chartered Accountants for Internal Audit. In our opinion, the internal audit is commensurate with its size & nature of its business,

viii. We have broadly reviewed the books of accounts maintained by the company in respect of products where pursuance to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under section 209(1) clause (d) of the Companies Act, 1956 and are of the opinion that prima facie. the prescribed accounts and records has been made and maintained. We have not, however, made a detail examination of the records with a view to determine whether they are accurate or complete.

ix. (a) According to the records maintained by the Company undisputed Statutory dues including provident fund, employees State insurance, Income-tax, Wealth-tax, Service Tax, Sales-tax Customs duties, excise duty, cess and other statutory dues have not been regularly deposited during the year with the appropriate authorities. On the basis of records produced before us for our verification and according to the information & explanation given to us, no undisputed amount payable in respect of afore said dues were in arrears as at 31st March, 2010 for a period of more than six months from the date they became payable.

(b) On the basis of records produced before us for our verification and according and income-tax to the information and explanations given to us, the details of disputed , Sales Tax, Central Excise duty dues aggregating to Rs. 327.60 lacs that have not been deposited as on 31st March, 2010 on account of matters pending before appropriate authorities, the details of which are as under.

Sr. Nature of the dues Financial Year Forum where Amount to which the the matter is pending (Rs. In Lacs) matter relates

1 SALES TAX

a) Sales Tax Demand 1994-1957 Gujarat High Court 47,23

2 CENTRAL EXCISE DUTY

a) Excise demand for product 01.04.1988 to Customs, Excise and Service Tax 147.91 classifications 29.02.2000 Appellate Tribunal - Mumbai

b) Excise demand for product 01.09.1996 to Gujarat High Court 9.61 classifications 31.05.1997

c) Excise demand on CENVAT 01.01.2006 to Customs, Excise and Service Tax 101.96 Reversal on Exempted Goods 31.03.2006 Appellate Tribunal-Mumbai

d) Excise demand on CENVAT 01.01.2007 to Customs, Excise and Service Tax 14,46 Reversal on Exempted Goods 31.05.2007 Appellate Tribunal-Mumbai

3 INCOME TAX

a) Income Tax Demand 2002-2003 CIT(A)-Ahmedabad 2.97

b) Income Tax Demand 2004-2005 Income Tax Officer, Ward 1<1) 0.18

c) Income Tax Demand 2006-2007 CIT(A)-Ahmedabad 3.28

x. The Company does not have accumulated losses at the end Of the financial year and has not incurred cash losses in the financial year under question and in the immediately preceding financial year.

xi, According to information & explanations given to us, the company has not defaulted in repayment of dues to Financial Institutions or Banks.

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

xiii. In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund/ society.

xlv. According to the information & explanations given to us, the company is not dealing or trading in shares, securities debentures & other investments.

xv. In our opinion, the terms & conditions on which the company has given guarantee for loans taken by others from Banks or financial institutions are prima facie, not prejudicial to the interest of the company.

xvi, In our opinion and according to the Information & explanations given to us the term loans have been applied for the purpose for which they were raised.

xvii. According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company and after placing reliance on the reasonable assumptions made by the company, there are no funds raised on short term basis, which have been used for long term purpose.

xviii.During the year the company has not made any preferential allotment of shares to the companies covered in the register maintained under section 301 of the Act. In our opinion the prices at which the shares have been Issued are not prejudicial to the interest of the Company.

xix. The company has not issued any debentures during the year and hence the question of creation of security does not arise.

xx. The company has not raised any money by way of public Issue during the year.

xxi. According to the information & explanations given to us, no fraud on or by the company has been noticed or reported during the course of our Audit.

For PARIKH & MAJMUDAR

Chartered Accountants

[HITEN PARIKH] Place : Ahmedabad Partner

Date : 14.05.2010 Membership No, 40230

FRN No. 107525W

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