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Auditor Report of Balmer Lawrie & Company Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of Balmer Lawrie & Co.Ltd. ("the company"), which comprise the Balance Sheet as at 31st March, 2015 the statement of Profit and Loss and the Cash Flow statement for the year then ended, and a summary of the significant accounting policies and other explanatory information, in which are incorporated the accounts of the Southern Region, Northern Region, Western Region of the Company for the year ended on that date audited by the Regional Auditor of the Company in accordance with the letter of appointment issued by Comptroller & Auditor General of India,

Management's Responsibility for the Standalone Financial Statements

The Company, Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the Accounting principles generally accepted in india, including the accounting standards specified under section 133 of the Act, read with rule 7 of the companies (Accounts ) Rules 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding the assets of the company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accouting policies; making judgements and estimate that are resonable 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, relevent 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.

Auditors Responsibility

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

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

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

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

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

Opinion

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

Emphasis of Matters

We draw attention to the following matters in the Notes to the financial statements:

a. Note No-26.7:-Trade receivables, loans and advances and deposits of which confirmations are not received from the parties are subject to reconciliation and consequential adjustments on determination/ receipt of such confirmation.

b. Note No-26.29:- Change in inventory valuation of semi -finished goods and finished goods in respect of Industrial Packaging division and Leather chemicals division consequent to implementation of SAP and the impact of such change on the profit is not ascertainable.

Our opinion is not modified on these matters.

OTHER MATTER

We did not audit the financial statement of three (3) Regions included in the standalone financial statements of the compnay whose financial statements reflect total assets of Rs. 80,874.65 lacs as at 31st March, 2015 and total revenue of Rs. 2,33,764.36 lacs for the year ended on that date,as considered in the standalone financial statements. The financial statements of these Regions have been audited by the Regional auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these Regions,is based solely on the report of such Regional auditors.

Report on Other Legal and Regulatory Requirments

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

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

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

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

(c) The reports on the account of the three (3) Regions of the company audited under section 143(8) of the act by Regional auditors have been sent to us and have been properly dealt with by us in preparing this report.

(d) 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.

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

(g) With respect to the other matters to be included in the Auditors 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 explanation given to us :

i. The company has disclosed the impact of pending litigations on its financial statements- Refer Note 26.2(a) &(b) to the financial statements;

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

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

3. As required by section 143(5) of the Act, a statement on the matters specified as per directions given by the comptroller & Auditor General of India, is given in Annexure-B

ANNEXURE TO THE INDEPENDENT AUDITORS REPORT

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

(i) In respect of its fixed assets:

(a) The Comapny has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets.

(b) The company has a regular programme of physical verification of its fixed assets by which Plant and Machinery are verified every year and other fixed assets are verified in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the company and nature of its assets. As explained to us, in accordance with its programme plant and machinery and certain other fixed assets were verified during the year and no material discrepancies were noticed on such verification.

(ii) In respect of its inventories:

(a) The inventory of the company expect goods in transit has been physically verified during the year by the management. In our opinion, having regard to the nature and location of inventory, the frequency of verification is reasonable.

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

(c) On the basis of our examination of records of inventory, in our opinion, the company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) According to the information and explanation given to us, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013. Accordingly, clause 3(iii)(a) to 3(iii)(b) of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items purchased are of special nature and for which suitable alternative sources are not readily available for obtaining comparative quotations, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventories, fixed assets and for the sales of goods and services. Further on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weaknesses in such internal control. The company has taken steps to strengthen the internal control system regarding management of debtors and is in the process of further strengthening the same. During the year the company has implemented SAP system in phase wise manner for accounting and operational control.

(v) According to information and explanations given to us, the company has not accepted any deposits from public during the year and therefore the directives issued by the Reserve bank of India and the provision of Sections 73 to 76 or any other relevant provision of the Companies Act, 2013 and the rules framed there under are not applicable to the Company.

(vi) We have broadly reviewed the cost records maintained by the company in respect of the products of Grease and Lubricants ,Industrial Packaging & Leather Chemical where, pursuant to the Companies (cost Records and Audit) Rules, 2014 read with companies (cost Records and audit) Amendment Rules, 2014 prescribed by the central government under section 148 of the companies act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the central government has not prescribed the maintenance of cost records for any other product of the company.

(vii) According to the information and explanations given to us and the records of the company examined by us :

(a) The company is generally regular in depositing with the appropriate authorities, undisputed statutory dues including Provident fund, Employees state insurance, income tax, sales tax, wealth tax, service tax, customs Duty and excise duty, value added tax, cess and any other material statutory dues applicable to the Company.

(b) There were no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, Duty of customs, Duty of excise or value added tax, cess and other material statutory dues in arrears as at 31st March, 2015 for a period of more than 6 months from the date they became payable.

(c) The particulars of dues of income tax , sales tax, service tax,excise duty, value added tax and cess as at 31st March, 2015 aggregating to Rs. 9418.35 lacs; which have not been deposited on account of a dispute, as mentioned in Note no.26.2(a) to the Accounts showing the amounts involved and the forum where dispute is pending.

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

(viii) The company has no accumulated losses as at 31st March, 2015 and it has not incurred cash losses during the financial year ending 31st March, 2015 and immediately preceding financial year.

(ix) According to the records of the Company examined by us and the information and explanations given to us, we are of the opinion that the company has not defaulted in repayment of dues to any financial institutions, banks or debentures holders as at the Balance Sheet date.

(x) In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from bank or financial institutions. Accordingly, the provision of clause 3(x) of the Order are not applicable to the Company.

(xi) According to the information and explanation given to us, the Company has not taken any term loan during the year.

(xii) During the course of our audit, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor reported during the year, nor have we been informed of such case by the management.

For Vidya and Co. Chartered Accountants FRN:308022E

CA Sarad Jha Partner Membership No : 050138

Place : Kolkata Date : 27th May, 2015


Mar 31, 2014

We have audited the accompanying financial statements of Balmer Lawrie & Co Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information, in which are incorporated the accounts of the Regions audited by Branch Auditors in accordance with the letter of appointment issued by the Comptroller and Auditor General of India.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of 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 the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Emphasis of Matter

We draw attention to:

1. Note No. 26.31 : Change in depreciation rates on items given under furniture equipment scheme of employees and the effect of such revision resulted in reduction of current year profit by Rs 13,84,868/-

2. Note No. 26.29 : Change in Inventory valuation of semi finished goods and finished goods in respect of Industrial Packing Division consequent to implementation of SAP and impact of such change on the profit is not ascertainable.

Our opinion is not qualified in respect of above matters.

Opinion

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

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

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

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

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

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

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

Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act 2013;

e) Since the Company is a Government Company, the provIsions of the Section 274(1)(g) of the Act relating to disqualifications of directors are not applicable, vide Government of India, Department of Company Affairs Notification No. GSR 829(E) dated 21st October, 2003.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

The Annexure referred to in our report to the members of Balmer Lawrie & Co Ltd ("the Company") on the accounts of the Company for the year ended 31 March, 2014. We report that:

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

b. The company has a regular programme of physical verification of its fixed assets by which Plant and Machinery are verified every year and other fixed assets are verified in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the company and nature of its assets. As explained to us, in accordance with its programme plant and machinery and certain other fixed assets were verified during the year and no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanations given to us, the Company has not disposed off a substantial part of the fixed assets during the year, and therefore, does not affect the going concern assumption.

(ii) a. The inventory of the Company has been physically verified during the year by the management. In our opinion, having regard to the nature and location of inventory, the frequency of verification is reasonable.

b. In our opinion, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. On the basis of our examination of records of inventory, in our opinion, the company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) As represented to us, there are no companies, firms, or other parties to be listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, requirement of clauses (iii)(a) to (iii)(g) of paragraph 4 of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items purchased are of special nature and for which suitable alternative sources are not readily available for obtaining comparative quotations, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventories, fixed assets and for the sales of goods and services. Further on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weaknesses in such internal control. The company has taken steps to strengthen the internal control system regarding management of debtors and is in the process of further strengthening the same. During the year the Company has implemented SAP system in phase wise manner for accounting and operational control.

(v) In view of our comment in paragraph (iii) above, clauses (v)(a) and (v)(b) of paragraph 4 of the Order in respect of contracts or arrangements referred to in Section 301 of the Companies Act, 1956, and transactions made in pursuance of such contracts or arrangements exceeding the value of Rs 5 lacs in respect of any party, are not applicable to the company.

(vi) The Company has not accepted any deposits from the public within the meaning of the Sections 58A and 58AA the Companies Act, 1956 and the Rules framed there under.

(vii) In our opinion, the Company''s present internal audit system as conducted in phased manner, by a firm of Chartered Accountants, is commensurate with its size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company in respect of the products of Grease and Lubricants, Industrial Packaging & Performance Chemical where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under Section 209(1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and

maintained. We have, however, not made a detailed examination of such records with a view to determine whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central Government under the aforesaid Act has not prescribed the maintenance of cost records for any other products or services of the Company.

(ix) According to the information and explanations given to us and the records of the Company examined by us:

a) The Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty and Excise Duty, Cess and any other material statutory dues applicable to the Company.

b) There were no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax and other material statutory dues in arrears as at 31st March, 2014 for a period of more than 6 months from the date they became payable.

c) The particulars of dues of Income Tax, Sales Tax, Service Tax, Excise Duty and Cess as at 31st March, 2014 aggregating to Rs 18972.80 Lacs which have not been deposited on account of a dispute, as mentioned in Note no. 26.2(a) to the Accounts showing the amounts involved and the forum where dispute is pending.

(x) The Company has no accumulated losses as at 31st March, 2014 and it has not incurred cash losses during the financial year ending 31st March, 2014 and immediately preceding financial year.

(xi) According to the records of the Company examined by us and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions, banks or debenture holders as at the Balance Sheet date.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has maintained adequate documents and records in respect of loans and advances granted to a

party on the basis of security by way of pledge of shares.

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

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

(xv) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the Company has not taken any term loan during the year.

(xvii) On an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on short-term basis which have been used for long term investment during the year.

(xviii) The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company has not issued any debentures during the year and therefore no amount is outstanding in respect of debentures as on the Balance Sheet date.

(xx) The Company has not raised any money by public issues during the year.

(xxi) During the course of our audit, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor reported during the year, nor have we been informed of such case by the management.

For VIDYA & co. Chartered Accountants FRN: 308022E CA Sarad Jha Partner Membership No.: 050138

Place : Kolkata Date: 29th May, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Balmer Lawrie & Co. Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information, in which are incorporated the accounts of the Regions audited by Branch Auditors in accordance with the letter of appointment issued by the Comptroller and Auditor General of India.

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

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

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

Opinion

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

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

b) in the case of the Profit and loss Account, of the profit for the year ended on that date; and

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

Report on Other legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("theOrder")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 account as required by law have been kept by the Company so far as appears from our examination of those books.

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

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

e) Since the Company is a Government Company, the provIsions of the Section 274(1)(g) of the Act relating to disqualifications of directors are not applicable, vide Government of India, Department of Company Affairs Notification No. GSR 829(E) dated 21st October, 2003.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

The Annexure referred to in our report to the members of Balmer Lawrie & Co Ltd ("the Company") on the accounts of the Company for the year ended 31 March, 2013. We report that:

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

b. The company has a regular programme of physical verification of its fixed assets by which Plant and Machinery are verified every year and other fixed assets are verified in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the company and nature of its assets. As explained to us, in accordance with its programme plant and machinery and certain other fixed assets were verified during the year and no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanations given to us, the Company has not disposed off a substantial part of the fixed assets during the year, and therefore, does not affect the going concern assumption.

(ii) a. The inventory of the Company has been physically verified during the year by the management. In our opinion, having regard to the nature and location of inventory, the frequency of verification is reasonable.

b. In our opinion, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. On the basis of our examination of records of inventory, in our opinion, the company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) As represented to us, there are no companies, firms, or other parties to be listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, requirement of clauses (iii)(a) to (iii)(g) of paragraph 4 of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items purchased are of special nature and for which suitable alternative sources are not readily available for obtaining comparative quotations, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventories, fixed assets and for the sales of goods and services. Further on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weaknesses in such internal control. The company has taken steps to strengthen the internal control system regarding management of debtors and is in the process of further strengthening the same.

(v) In view of our comment in paragraph (iii) above, clauses (v)(a) and (v)(b) of paragraph 4 of the Order in respect of contracts or arrangements referred to in Section 301 of the Companies Act, 1956, and transactions made in pursuance of such contracts or arrangements exceeding the value of Rs. 5 lacs in respect of any party, are not applicable to the company.

(vi) The Company has not accepted any deposits from the public within the meaning of the Sections 58A and 58AA the Companies Act, 1956 and the Rules framed there under.

(vii) In our opinion, the Company''s present internal audit system as conducted in phased manner, by a firm of Chartered Accountants, is commensurate with its size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company in respect of the products of Grease and Lubricants (petroleum products) and Industrial Packaging where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under Section 209(1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of such records with a view to determine whether they are accurate or complete.

To the best of our knowledge and according to the information and explanations given to us, the Central Government under the aforesaid Act has not prescribed the maintenance of cost records for any other products or services of the Company.

(ix) According to the information and explanations given to us and the records of the Company examined by us:

a) The Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty and Excise Duty, Cess and any other material statutory dues applicable to the Company.

b) There were no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax and other material statutory dues in arrears as at 31st March, 2013 for a period of more than 6 months from the date they became payable.

c) The particulars of dues of Income Tax, Sales Tax, Service tax, Excise Duty and Cess as at 31st March, 2013 aggregating to Rs. 8461.66 lacs; which have not been deposited on account of a dispute, as mentioned in Note no. 26.2(a) to the Accounts showing the amounts involved and the forum where dispute is pending.

(x) The Company has no accumulated losses as at 31st March, 2013 and it has not incurred cash losses during the financial year ending 31st March, 2013 and immediately preceding financial years.

(xi) According to the records of the Company examined by us and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions, banks or debenture holders as at the Balance Sheet date.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has maintained adequate documents and records in respect of loans and advances granted to a party on the basis of security by way of pledge of shares.

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

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

(xv) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the Company has not taken any term loan during the year.

(xvii) On an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on short-term basis which have been used for long term investment during the year.

(xviii)The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company has not issued any debentures during the year and therefore no amount is outstanding in respect of debentures as on the Balance Sheet date.

(xx) The Company has not raised any money by public issues during the year.

(xxi) During the course of our audit, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor reported during the year, nor have we been informed of such case by the management.

For Vidya and Co.

Chartered Accountants

FRN:308022E

CA Sarad Jha

Partner

Membership No. : 050138

Place: Kolkata

Date: 29th May, 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of Balmer Lawrie & Co. Limited ('the Company') as at 31st March, 2012, and also the Statement of Profit and Loss and Cash Flow Statement for the year ended on that date annexed thereto, in which are incorporated the accounts of the Regions audited by Branch Auditors in accordance with the letter of appointment issued by the Comptroller and Auditor General of India. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these fi -nancial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosure in the financial statements. An audit also includes assessing the accounting principles used and signifi cant 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 (as amended) ['the Order'] issued by the Central Government of India in terms of Section 227(4A) of the 'Companies Act 1956' (the Act), we enclose in the Annexure hereto a statement on the matters specifi ed in paragraph 4 and 5 of the said Order.

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

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

b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books. The related Branch Auditor's Reports have been forwarded to us and have been appropriately dealt with in preparing this report.

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

d. In our opinion, the Balance sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act.

e. Since the Company is a Government Company, the provisions of the Section 274(1) (g) of the Act relating to disqualifi cations of directors are not applicable, vide Government of India, Department of Company Affairs Notifi cation No. GSR 829(E) dated 21st October,2003.

f. In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with the notes and accounting policies thereon and annexed thereto, 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 31st March, 2012;

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

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

ANNEXURE TO THE AUDITOR'S REPORT (Referred to in paragraph 3 of our Report of even date)

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

b. The company has a regular programme of physical verifi cation of its fixed assets by which Plant and Machinery are verifi ed every year and other fixed assets are verifi ed in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the company and nature of its assets. As explained to us, in accordance with its programme plant and machinery and certain other fixed assets were verifi ed during the year and no material discrepancies were noticed on such verifi cation.

c. In our opinion and according to the information and explanations given to us, the Company has not disposed off a substantial part of the fixed assets during the year.

(ii) a. The inventory of the Company has been physically verifi ed during the year by the management. In our opinion, having regard to the nature and location of inventory, the frequency of verifi cation is reasonable.

b. In our opinion, the procedures of physical verifi cation of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. On the basis of our examination of records of inventory, in our opinion, the company is maintaining proper records of inventory and no material discrepancies were noticed on physical verifi cation.

(iii) As represented to us, there are no companies, fi rms, or other parties to be listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, requirement of clauses (iii)(a) to (iii)(g) of paragraph 4 of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that certain items purchased are of special nature and for which suitable alternative sources are not readily available for obtaining comparative quotations, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventories, fixed assets and for the sales of goods and services. Further on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weaknesses in such internal control. However, the internal control system regarding management of debtors and generation of scrap by the manufacturing units of the company needs to be further strengthened.

(v) In view of our comment in paragraph (iii) above, clauses (v)(a) and (v)(b) of paragraph 4 of the Order in respect of contracts or arrangements referred to in Section 301 of the Companies Act, 1956, and transactions made in pursuance of such contracts or arrangements exceeding the value of Rs. 5 lakhs in respect of any party, are not applicable to the company.

(vi) The Company has not accepted any deposits from the public within the meaning of the Sections 58A and 58AA of the Companies Act, 1956 and the Rules framed there under.

(vii) In our opinion, the Company's present internal audit system as conducted in phased manner, by a fi rm of Chartered Accountants, is commensurate with its size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company in respect of the products of Grease and Lubricants (petroleum products) and Industrial Packaging where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under Section 209(1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of such records with a view to determine whether they are accurate or complete.

To the best of our knowledge and according to the information and explanations given to us, the Central Government under the aforesaid Act has not prescribed the maintenance of cost records for any other products or services of the Company.

(ix)a. According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty and Excise Duty, Cess and any other material statutory dues applicable to the Company.

b. According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of Income Tax, Sales Tax, Service tax, Excise Duty and Cess as at 31st March, 2012 aggregating to Rs.. 7,787.79 lakhs; which have not been deposited on account of a dispute, as mentioned in Note no. 26.2(a) to the Accounts showing the amounts involved and the forum where dispute is pending.

(x) The Company has no accumulated losses as at 31st March, 2012 and it has not incurred cash losses during the financial year ending 31st March, 2012 and immediately preceding financial years.

(xi) According to the records of the Company examined by us and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions, banks or debenture holders as at the Balance Sheet date.

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has maintained adequate documents and records in respect of loans and advances granted to a party on the basis of security by way of pledge of shares.

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

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

(xv) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the Company has not taken any term loan during the year.

(xvii) On an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on short-term basis which have been used for long term investment during the year.

(xviii) The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company has not issued any debentures during the year and therefore no amount is outstanding in respect of debentures as on the Balance Sheet date.

(xx) The Company has not raised any money by public issues during the year.

(xxi) During the course of our audit, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor reported during the year, nor have we been informed of such case by the management.

For Vidya & Co

Chartered Accountants Firm Reg No: 308022E

CA Sarad Jha

Place: Kolkata Partner

Date : 26th May, 2012 Membership No.050138


Mar 31, 2011

1. We have audited the attached Balance Sheet of Balmer Lawrie & Company Limited (the Company) as at 31st March 2011, and also the Profit and Loss Account and Cash flow Statement for the year ended on that date annexed thereto, in which are incorporated the accounts of the Regions audited by Branch Auditors in accordance with the letter of appointment issued by the Comptroller and Auditor General of India. 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 have conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we pIan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by-the Companies (Auditor's Report) Order, 2003 ('the order') as amended, issued by the Central Government of India in terms of Sec 227(4A) of the 'Companies Act 1956' of India (the Act), we enclose in the Annexture a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comment in the Annexure referred to above, we report that:

(i) We have obtained all the information and explanations which to the' best of our knowledge and belief were necessary for the purposes of our audit subject to some observations as under:

a) ICICI Venture Fund Management Co. Ltd. exited the joint venture unit, Transafe Services Ltd. (TSL) with full benefits without retaining any right of recovery on the part of Balmer Lawrie & Co. Ltd. (BL) for possible losses. Specific joint venture agreement between BL and ICICI specifying the exit clause, important for any joint venture agreement could not be provided.

Consequent to exit of ICICI Ventures from TSL, the entire financial burden fell upon and/or assumed by Balmer Lawrie & Co. Ltd. (BL) for arranging necessary fund for settling the accounts of ICICI Ventures with premium as well as bringing in new partner namely Balmer Lawrie Van Leer Ltd. (BLVL), another unit of joint venture arrangement with BL.

Investment of Rs. 553.28 lakhs during the previous year, a fresh further Investment of a sum of Rs. 1330.00 lakhs during the current year by way of acquiring preference shares in TSL and providing unsecured loan of Rs. 1817.92 lakhs to BLVL for the purpose of purchase of shares held by ICICI Venture, was done without going through a process of Due Diligence. In addition the interest falling due for payment as on 31/03/2011 has also been not serviced. Therefore, in our opinion, all these investments totaling to Rs. 3701.20 lakhs appear to be prejudicial to the interest of the company.

b) The internal control system as regards management of debtors and generation of scrap by the manufacturing units of the Company needs to be further strengthened.

(ii) In our opinion, proper books of account, as required by law, have been kept by the Company so far as appears from our examination of those books. The related Branch Auditor's Reports have been forwarded to us and have been appropriately dealt with in preparing this report;

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

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

(v) This being Government Company, the provisions of the Section 274(1) (g) of the Act relating to disqualifications of directors are not applicable; vide Government of India, Department of Company Affairs Notification No. GSR 829(E) dated 21 October, 2003

(vi) Subject to our observation in 4 (i) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts together with the notes and accounting policies thereon and annexed thereto, 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 the Company's affairs as at 31st March 2011;

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

Annexure to Auditor's Report

The Annexure referred to in paragraph 3 of the Auditor's Report of even date to the members of Balmer Lawrie & Company Limited ('the Company') on the financial statements for the year ended 31st March, 2011. We report that:

1. a. The Company has maintained proper record showing full particulars including quantitative details and situations of fixed assets.

b. The Company has a regular programme of physical verification of its fixed assets by which plant and machinery are verified every year, and other fixed assets are verified in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, in accordance with its programme, plant and machinery and certain other fixed assets were verified during the year and no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanations given to us, the Company has not disposed off a substantial part of the fixed assets during the year.

2. a. The inventory of the Company has been physically verified during the year by the management. In our opinion, having regard to the nature and location of inventory, the frequency of verification is reasonable.

b. In our opinion, the procedure of physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. On the basis of our examination of the inventory records, in our opinion, the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

3. As represented to us, there are no Companies, firms or other parties to be listed in the register maintained under Section 301 of the Companies Act, 1956 ('the Act'). Accordingly, paragraphs 4 (iii) (b) to 4 (iii) (g) of the Order are not applicable.

4. In our opinion and according to the information and explanations given to us, having regard to the explanation that certain items purchased are of special nature for which suitable alternative sources do not exist for obtaining comparative quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of businesses, for the purchase of inventory and fixed assets and for the sale of goods and services.

Further, on the basis of our examination of the. books and records of the Company, and according to the information and explanations given to us, we have neither. come across nor have been informed of any continuing failure on the part of the Company to correct major weaknesses in the aforesaid internal control system.

5. In view of our comment in paragraph (3) above, paragraphs 4(v) (a) and 4(v) (b) of the order in respect of contracts or arrangements referred to in Section 301 of the Act, and transaction made in pursuance of such contracts 'or arrangements exceeding the value of Five Lakhs Rupees in respect of any party, are not applicable to the company.

6. The Company has not accepted any deposits from the public within the meaning of the sections 58A, 58AA of the Act and the rules framed there under.

7. In our opinion, the Company's present internal audit system as conducted in phased manner, by a firm of chartered accountants, is commensurate with its size and nature of its business but the same needs to be further strengthened with regard to widening the coverage of various areas like. investments made and its follow- up and in the matter of scrap management.

8. We have broadly reviewed the books of account maintained by the Company in respect of the products of Grease and Lubricants (petroleum products) and Tea Blending where, pursuant to the Rules made by the Central Government of india, the maintenance of cost records has been prescribed under Section 209(1) (d) of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of such records with a view to determine whether they are accurate or complete.

To the best of our knowledge and according to the information and explanations given to us, the Central Government under the aforesaid Act has not prescribed the maintenance of cost records for any other products or services of the Company.

9. a. According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, 'Wealth Tax, Service Tax, Custom Duty and Excise Duty, Cess and any other material statutory dues applicable to it.

b. According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income-tax, sales-tax, service-tax, excise duty and cess as at 31st March, 2011 aggregating to Rs. 6952.14 lacs; which have not been deposited on account of a dispute, are as mentioned in note on accounts showing the amounts involved and the forum where dispute is pending.

10. The Company has no accumulated losses as at 31st March, 2011, and it has not incurred any cash losses during the financial year ended on the date or in the immediately preceding financial year.

11. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank as at the balance sheet date. The Company has no debenture holder.

12. The Company has not granted any loans or advances on the basis ,of security by way of pledge of shares, debentures or other securities.

13. In our opinion, the provisions of any Special Statute applicable to Chit Fund, Nidhi Fund or Mutual Benefit Fund/Societies are not applicable to the Company.

14. In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

16. In our opinion, and according to the information and explanations given to us, and on an overall basis, the term loans have been applied for the purposes for which they were obtained. The Company did not have any outstanding term loan as at 31st March, 2011.

17. On an overall examination the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on short-term basis which have been used for long term investment during the year.

18. In view of our comment in paragraph (3) above, the question of any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act does not arise.

19. The Company has not issued any debentures during the year and no amount is outstanding in respect of debentures as on the balance sheet date.

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

21. During the course of our audit, and according to the information and explanation given to us, we have neither come across any instance of fraud on or by the Company nor reported during the year, nor have we been informed of such case by the management.

For J. GUPTA & CO.

Chartered Accountants

Firm Reg. No.: 314010E

S. P. Dutta

Kolkata Partner

Date: 28th May 2011 Membership No. 13852











 
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