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Auditor Report of Bodal Chemicals Ltd.

Mar 31, 2015

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

Management's Responsibility for the Financial Statements

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

Auditor's Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made 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 the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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 Companies Act, 2013, we give in the Annexure a statement on the matters specified in 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) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

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

i. The company has disclosed the impact of pending litigations as at 31st March, 2015 on its financial position in its financial statements -Refer Note 30 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 under the applicable law or accounting standards.

iii. There has been no delay in transferring amounts, required to be transferred to the Investor Education & Protection Fund by the Company during the year ended 31st March, 2015.

(Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" section 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 fixed assets were physically verified during the year by the Management in accordance with a regular program of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals having regard to the size of the company, nature and value of its assets. According to the information and explanation given to us, no material discrepancies were noticed on such verification.

(ii) In respect of its inventories,

(a) The inventory except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable. For goods-in-transit at year end, relevant evidences have been obtained.

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

(c) In our opinion and according to information and explanation given to us, the Company has maintained proper records of inventory. The discrepancies noticed on verification between physical stocks and book records were not material;

(iii) The company has granted interest free unsecured loan to 1(one) subsidiary company covered in the register maintained under section 189 of the Companies Act. Further the company has not granted any loan to firms or other parties covered in the register maintained under section 189 of the Companies Act.

a) In respect of the aforesaid loan, the principal amounts are repayable on demand, while the loan is interest free, both at the discretion of the Company.

b) In respect of the aforesaid loans, there are no overdue amounts.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

(v) In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed thereunder with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

(vi) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules prescribed by the Central Government for the maintenance of cost records under subsection (1) of section 148 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(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 Provident Fund, Employees' State Insurance, Income Tax, Sales Tax/ Value Added Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and material statutory dues wherever applicable have generally been regularly deposited during the year by the Company with the appropriate authorities. Further, According to the information and explanations given to us, no such undisputed amounts payable were in arrears 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, details of dues towards Income Tax, Excise Duty, Service Tax and Customs Duty which have not been deposited by the Company on account of disputes are as follows:

Name of the Statute Nature of Amount Period to which the Dues (Rs. in lacs) amount relates

Income Tax 144.66 A.Y. 2007-08

Income Tax Act, 1961. Income Tax 123.66 A.Y. 2008-09

Excise Duty 1.58 F.Y. 2011-12 & Penalty

Excise Duty 12.08 F.Y. 2006-07 & Penalty to F.Y.2010-11

Excise Duty 59.18 F.Y. 2005-06 & Penalty to F.Y.2007-08

Central Excise Act, 1944 Excise Duty 23.21 F.Y. 2005-06 & Penalty to F.Y.2007-08

Excise Duty 0.62 F.Y. 2011-12 & Penalty

Excise Duty 54.63 F.Y. 2013-14 & Penalty

Excise Duty 26.32 F.Y. 2013-14 & Penalty

Excise Duty 6.13 F.Y. 2013-14 & Penalty

Excise Duty 4.55 F.Y. 2010-11 & Penalty to F.Y. 2011-12

Excise Duty 4.86 F.Y. 2013-14 & Penalty

Excise Duty 0.13 F.Y. 2010-11 & Penalty to F.Y. 2011-12

Excise Duty 0.15 F.Y. 2014-15 & Penalty

Service Tax Service Tax 3.86 F.Y. 2011-12 & Penalty

Customs Act, 1962. Duty, Penalty, 11.71 F.Y. 2007-08 Interest & Fine

Name of the Statute Forum where dispute is pending

Commissioner of Income Tax (Appeals)

Income Tax Act 1961

Commissioner of Income Tax (Appeals)

Customs, Excise & Service Tax Appellate Tribunal

Customs, Excise & Service Tax Appellate Tribunal

Customs, Excise & Service Tax Appellate Tribunal

Central Excise Act 1944 Customs, Excise & Service Tax Appellate Tribunal

Commissioner of Central Excise (Appeals)

Customs, Excise & Service Tax Appellate Tribunal

Commissioner of Central Excise (Appeals)

Customs, Excise & Service Tax Appellate Tribunal

Customs, Excise & Service Tax Appellate Tribunal

Commissioner of Central Excise (Appeals)

Commissioner of Central Excise (Appeals)

Commissioner of Central Excise (Appeals)

Service Tax Customs, Excise & Service Tax Appellate Tribunal

Customs Act 1962 Customs, Excise & Service Tax Appellate Tribunal

According to the information and explanations given to us, there are no material dues of wealth tax, Sales Tax including Value Added Tax, and Cess which have not been deposited with the appropriate authorities on account of any dispute.

(c) The amount required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 and rules made there under has been transferred to such fund within time.

(viii) The Company does not have any accumulated loss at the end of the financial year and has not incurred cash loss during the financial year covered by our audit and in the immediately preceding financial year;

(ix) In our opinion and according to the information and explanations given to us, the Company has not defaulted during the year in repayment of dues to bank. The Company did not have any amount outstanding to financial institutions or debenture holders during the Year.

(x) According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a banks or financial institutions.

(xi) In our opinion and according to the information and explanations given to us, the term loans taken by the Company have been applied for the purposes for which they were obtained.

(xii) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, not have we been informed of any such case by the Management.

For Mayank Shah & Associates Chartered Accountants Firm Registration No: 106109W

M.S. SHAH Ahmedabad Partner May 30, 2015 Membership No. 44093


Mar 31, 2014

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

Management’s Responsibility for the Financial Statements

The Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub- section (3C) of section 211 of the Companies Act, 1956 (“the Act”) read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and 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 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:

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; and

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

ANNEXURE TO THE INDEPENDENT AUDITOR’S REPORT (Referred to in Paragraph 1 under “Report on Other Legal and Regulatory Requirements” section of our report of even date)

1. In respect of its fixed assets :

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

b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.

c) Fixed assets disposed off during the year were not substantial and therefore do not affect the going concern assumption.

2. In respect of its inventories :

a) The inventory, except good-in-transit and stocks lying with the third parties, has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable. For stocks lying with the third parties at the year end, written confirmations have been obtained.

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

c) The Company has maintained proper records of inventory. The discrepancies noticed on verification between physical stocks and book records were not material.

3. In respect of the 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 Companies Act,1956 :

a) The Company has given interest free loan to its subsidiary. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 493.40 lacs and the year-end balance is Rs.473.71 lacs

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

c) The principal amounts are repayable on demand, while the loan is interest free, both at the discretion of the Company.

d) In respect of the said loans and interest thereon, there are no overdue amounts.

e) The Company had taken unsecured loan from the 1 (One) party listed in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 0.50 lacs & the year end balance of loan is Rs. 0.50 lacs.

f) In our opinion the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

g) In our opinion and according to the information and explanation given to us, repayment of the principal amount is as stipulated and payments of interest, wherever applicable, have been regular.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods. The activities of the Company do not include rendering of services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas.

5. a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements

referred to in Section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

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

7. As per information & explanations given by the management, the Company has an internal audit system commensurate with its size and the nature of its business.

8. We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules prescribed by the Central Government for the maintenance of cost records under Section 209 (1) (d) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

9. 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 Provident Fund, Employees’ State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax/ Value Added Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and material statutory dues have generally been regularly deposited during the year by the Company with the appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees’ State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax/ Value Added Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and other material statutory dues were in arrears as at 31st March, 2014 for a period of more than six months from the date they became payable.

c) According to the information and explanations given to us, the following dues have not been deposited by the Company on account of disputes.

Name of the Statute Nature of A mount under Dispute not the Dues yet deposited (Rs. in lacs)

Income Tax 27.11

Income Tax 200.27

Income Tax Act, 1961. Income Tax 123.66

Income Tax 54.02

Excise Duty 1.58 & Penalty

Excise Duty 12.08 & Penalty

Excise Duty 59.18 & Penalty

Central Excise Act,1944 Excise Duty 23.21 & Penalty

Excise Duty 0.62 & Penalty

Excise Duty 54.63 & Penalty

Excise Duty 26.32 & Penalty

Excise Duty 6.13 & Penalty

Service Tax Service Tax 3.86 & Penalty

Customs Act, 1962. Duty, Penalty, 11.71 Interest & Fine

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

A.Y. 2006-07 Commissioner of Income Tax (Appeals)

A.Y. 2007-08 Commissioner of Income Tax (Appeals)

Income Tax Act 1961 A.Y. 2008-09 Commissioner of Income Tax (Appeals)

A.Y. 2010-11 Commissioner of Income Tax (Appeals)

F.Y. 2011-12 Customs, Excise & Service Tax Appellate Tribunal

F.Y. 2006-07 Customs, Excise & to F.Y.2010-11 Service Tax Appellate Tribunal

F.Y. 2005-06 Customs, Excise & to F.Y.2007-08 Service Tax Appellate Tribunal

F.Y. 2005-06 Customs, Excise & to F.Y.2007-08 Service Tax Appellate Tribunal

Central Excise Act 1944 F.Y. 2011-12 Commissioner of Central Excise (Appeals)

F.Y. 2013-14 Customs, Excise & Service Tax Appellate Tribunal

F.Y. 2013-14 Commissioner of Central Excise (Appeals)

F.Y. 2013-14 Customs, Excise & Service Tax Appellate Tribunal

F.Y. 2011-12 Customs, Excise & Service Tax Appellate Tribunal

F.Y. 2007-08 Customs, Excise & Service Tax Appellate Tribunal

10. The Company has accumulated losses at the end of financial year which is not in excess of fifty percent of its net worth. It has not incurred cash losses during the Current financial year; however the company incurred cash losses in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a bank. Further, in our opinion and according to information and explanations given to us, the Company did not have any amount outstanding to financial institutions or debenture holders.

12. According to the information and explanation given to us the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. As the provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company, the provisions of Clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

14 In our opinion and according to the information and explanations given to us, the Company is not dealing in shares, securities and debentures. Therefore, the provisions of clause 4(xiv) of the Order are not applicable to the Company.

15. According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution. Therefore, the provisions of clause 4(xv) of the Order are not applicable to the Company.

16. In our opinion and according to the information and explanations given to us, the term loans taken by the company have been applied for the purpose for which they were raised.

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

18. The Company has not made any preferential allotment of shares to companies / firms / parties covered in the register maintained under Section 301 of the Act during the year.

19. The Company did not have any outstanding debentures during the year.

20. During the year covered by our report, the Company has not raised any money by way of public issue.

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

For, Mayank Shah & Associates Chartered Accountants (Firm Registration No. 106109W)

(M.S.Shah) Partner Mem. No. 44093

Ahmedabad May 28, 2014


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

The Company''s 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 accompanying 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 Statement of Profit and Loss, of the loss 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'', as amended by ''the Companies (Auditor''s Report) (Amendment) Order, 2004'', issued by the Central Government of India in terms of sub-section (4A)of section 227 of the Act (hereinafter referred to as the "Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, 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 dealt with by these report comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Act ;

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

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT

(Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements” section of our report of even date)

1. In respect of the Company''s fixed assets :

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

(b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us, no fixed asset has been disposed during the year and therefore, in our opinion, not affected the going concern status of the Company.

2. In respect of Company''s inventories

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

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

(c) In our opinion and on the basis of our examination of the records, the Company is generally maintaining proper records of its inventories. No material discrepancy was noticed on physical verification of stocks by the management as compared to book records.

3. In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firms or other parties covered under section 301 of Companies Act,1956

a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, the provisions of clauses iii (b) and iii(c) of paragraph 4 of the Order are not applicable to the Company.

b) The Company had taken unsecured loan from the 1 (One) party listed in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 175.00 lacs & the year end balance of loans was Rs. 0.50 lacs.

c) According to the information and explanation given to us, repayment of the principal amount is as stipulated and payments of interest, wherever applicable, have been regular.

d) In our opinion the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventories & fixed assets and payment for expenses & for sale of goods. During the course of our audit, we have not observed any major weakness in such internal control system

5. a) In our opinion and according to the information given to us, the particulars of contracts or arrangements referred to

in Section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lacs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

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

7. As per information & explanations given by the management, the Company has an internal audit system commensurate with its size and the nature of its business.

8. As per information & explanation given by the management, maintenance of cost records has been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

9. According to the information and explanations given to us, in respect of statutory dues:

a) According to the records of the company, undisputed statutory dues including Provident Fund, Investor Education and protection Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, cess to the extent applicable and any other statutory dues have generally been regularly deposited with the appropriate authorities. As explained to us, no undisputed amounts payable were in arrears as at 31st March,2013 for a period of more than six months from the date they become payable.

b) According to the information and explanation given to us and the records of the Company examined by us, the dues of Service Tax, Custom Duty, Excise Duty ,Wealth tax, Sales Tax and the particulars of dues of Income Tax as at 31st March 2013 which has not been deposited on account of a dispute, are as follows :

Statement of Disputed Dues Name of the Statute Nature of Amount under Period to which Forum wher dispute is the Dues dispute not amount relates pending yet deposited (Rs. in lacs)

Income Tax 0.19 A.Y. 1999-2000 Income Tax Appellate Tribunal

Income Tax 61.57 A.Y. 2007-2008 Income Tax Appellate Tribunal

Income Tax Act, 1961. Income Tax 29.65 A.Y. 2008-2009 Commissioner of Income Tax (Appeals)

Income Tax 87.91 A.Y. 2007-2008 Commissioner of Income Tax (Appeals)

Penalty 0.59 A.Y. 2006-2007 Commissioner of Income Tax (Appeals)

Income Tax 68.13 A.Y. 2007-2008 Commissioner of Income Tax (Appeals)

Excise Duty 1.58 2011-2012 Commr.C.Ex. & Penalty Ahmedabad-I

Central Excise Act, 1944. Excise Duty 15.80 2011-2012 Pending at CESTAT & Penalty

Service Tax 12.08 2006-2007 Pending at CESTAT to 2010-2011

Service Tax 1.35 2011-2012 CESTAT, Ahmedabad

Service Tax 59.18 2005-2006 CESTAT, Ahmedabad and Penalty to 2007-2008

Service Tax Service Tax 23.21 2005-2006 Pending at CESTAT (Finance Act 1994) to 2007-2008

Service Tax 0.62 2011-2012 Pending at CESTAT & Penalty

Customs Act, 1962. Duty, Penalty, 11.71 2007-2008 CESTAT, Additional West

Interest & Zonal Bench, Fine Ahmedabad.

10. The Company''s accumulated losses at the end of financial year are less than fifty percent of its net worth. It has incurred cash loss during the Current financial year and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to Banks. Company has not raised any fund from financial institutions or debenture holders.

12. According to the information and explanation given to us the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. As the provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund / societies are not applicable to the Company, the provisions of Clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

14 In our opinion and according to the information and explanations given to us, the Company is not dealing in shares, securities and debentures. Therefore, the provisions of clause 4(xiv) of the Order are not applicable to the Company.

15. In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution. Therefore, the provisions of clause 4(xv) of the Order are not applicable to the Company.

16. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion, the term loans raised during the year were prima facie been utilized for the purposes for which they were obtained.

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

18. According to the information and explanations given to us, during the year covered by our audit, the Company has made preferential allotment of preference shares to parties covered in the register maintained under Section 301 of the Companies Act, 1956.In our opinion price at which shares are issued in not prejudicial to the interest of the company.

19 According to the information and explanations given to us, during the year covered by our report, the Company has not issued any secured debentures.

20 During the year covered by our report, the Company has not raised any money by way of public issue. Accordingly Provisions of Clause 4(XX) of the order are not applicable to the Company.

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

For, Mayank Shah & Associates (Firm Registration No. 106109W)

Chartered Accountants

(M.S.Shah)

Place:Ahmedabad Partner

Date :30/05/2013 Mem. No. 44093


Mar 31, 2012

1. We have audited the attached Balance Sheet of BODAL CHEMICALS LIMITED (the "Company"), as at 31st March, 2012 and also the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

We are unable to examine as per the accepted Standards of Auditing issued by Institute of Chartered Accountants of India, evidence supporting the amount of Income covered in the Disclosure under the Income Tax Act and its utilization thereof more particularly described in Note No. 37 to the Financial Statement and accordingly are unable to comment on the same.

3. As required by the Companies (Auditors' Report) Order, 2003 as amended by The Companies (Auditor's Report) Amendment Order, 2004 (together the "Order") issued by the Central Government of India in terms of sub-section (4A) of Section Section 227 of 'The Companies Act, 1956' of India (the 'Act') and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the annexure referred to 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 appears from our examination of those books;

C. The Balance Sheet, Statement of Profit & 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 & Loss and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Sub-section 3 (c) of section 211 of the Act ;

E. On the basis of written representations received from the directors, as on 31st March 2012 and taken on record by Board of Directors, none of the directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act ;

F. In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give in the prescribed manner, the information required by the Act and subject to disclosure of Income of Rs. 1081.23 Lacs Under Section 132(4) of the Income Tax Act, 1961 more particularly described in Note No. 37 give a true and fair view in conformity with the accounting principles generally accepted in India.

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

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

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

Referred to in paragraph 3 of our Auditors' Report of even date to the members of Bodal Chemicals Limited on the financial statements as of and for the year ended 31st March 2012)

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

b) According to the information and explanation given to us, the Company has formulated a regular program of verification by which all the assets of the company shall be verified in a phased manner, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, portion of fixed assets have been physically verified by the management during the year and no material discrepancies between the book records and physical inventory have been noticed.

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

2 a) The inventory has been physically verified by the Management during the year. In our opinion the frequency of verification is reasonable.

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

c) On the basis of our examination of the inventory records, in our opinion, the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account.

3 a) The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act, and therefore, clause of rates of interest and other terms & conditions and repayment is not applicable to the company.

b) The Company had taken unsecured loan from the 3 (Three) parties listed in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 508.21 lacs & the year end balance of loans was Rs. Nil.

c) According to the information and explanation given to us, repayment of the principal amount is as stipulated and payments of interest, wherever applicable, have been regular.

d) In our opinion the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

4 In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to the purchase of inventory and fixed assets and for the sale of goods. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanation given to us, no major weakness have been noticed or reported.

5 a) In our opinion and according to the information given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

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

7 The internal audit function is carried out by outside agency appointed by the management, the scope and coverage of which, in our opinion requires to be enlarged to be commensurate with the size and nature of its business.

8 We have broadly reviewed the books of accounts and records maintained by the company relating to the manufacturing of Chemical products comprising Dyes, Dyes Intermediates and Basic Chemicals where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records have been made & maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

9 a) According to the information and explanations given to us and records of the company examined by us, in our opinion, the company is regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty and other material statutory dues as applicable, with the appropriate authorities.

b) According to the information and explanation given to us and the records of the Company examined by us, there are no dues of Wealth tax and Sales Tax which have not been deposited on account of any dispute and the particulars of dues of Income Tax, Services Tax, Customs Duty and Excise Duty as at 31st March 2012 which has not been deposited on account of a dispute, are as follows :

Statement of Disputed Dues Name of the Statute Nature of Amount Period to which Forum where dispute is the Dues (Rs. in lacs) amount relates pending

Income Tax 0.19 A.Y. 1999-2000 Income Tax Appellate Tribunal

Income Tax 61.57 A.Y. 2007-2008 Income Tax Appellate Tribunal

Income Tax Act, 1961. Income Tax 29.65 A.Y. 2008-2009 Commissioner of Income Tax (Appeals)

Income Tax 87.91 A.Y. 2007-2008 Commissioner of Income Tax (Appeals) Penalty 0.59 A.Y. 2006-2007 Commissioner of Income Tax (Appeals)

Income Tax 68.13 A.Y. 2007-2008 Commissioner of Income Tax (Appeals)

Excise Duty 1.18 2010-2011 CESTAT, Ahmedabad

Excise Duty 1.58 2011-2012 Commr.C.Ex. & Penalty Ahmedabad-I

Central Excise Act, 1944. Excise Duty 1.65 2011-2012 Commr.C.Ex. Ahmedabad-I

Excise Duty 15.80 2011-2012 Commr. Central Excise, & Penalty Surat-II

Service Tax 12.08 2006-2007 The Commisioner to (Appeals), Central 2010-2011 Excise - Ahmedabad

Service Tax 1.35 2011-2012 CESTAT, Ahmedabad

Service Tax 59.18 2005-2006 CESTAT, Ahmedabad and Penalty to 2007-2008



Service Tax Service Tax 23.21 2005-2006 The Commisioner (Finance Act 1994) to(Appeals), Central

2007-2008 Excise - Ahmedabad

Service Tax 0.23 2010-2011 Commi.S.Tax Ahmedabad-I

Service Tax 0.62 2011-2012 Commi.S.Tax & Penalty Ahmedabad-I

Customs Act, 1962. Duty, Penalty, 10.11 2007-2008 CESTAT, Additional West Interest & Zonal Bench, Fine Ahmedabad.

10. The company's accumulated losses at the end of the financial year are less than fifty per cent of its net worth. it has incurred cash losses in current financial year however it has not incurred cash losses during immediately preceding financial year.

11. According to records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to banks and financial institutions as at Balance sheet date.

12. According to the information and explanation given to us the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The provisions of any special statue applicable to chit fund, nidhi, or any mutual fund / societies are not applicable to the company.

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

15. According to the information and explanation given to us the Company has not given guarantee for loans taken by others from banks or financial institutions.

16. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion, the term loans raised during the year were prima facie been utilized for the purposes for which they were obtained.

17. According to the information and explanations given to us and on overall examination of the balance sheet and cash flow statement of the Company, we report that Company has used funds raised on short term basis for long term investments.

18. According to the information and explanations given to us, during the period covered by our audit report, the Company has made preferential allotment of equity shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.In Our opinion the price at which shares have been issued is not prejudicial to the interest of the company.

19. According to the information and explanations given to us, during the year covered by our report, the Company has not issued any secured debentures.

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

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



For Mayank Shah & Associates

(Firm Registration No. 106109W) Chartered Accountants

(M.S.Shah)

Place : Ahmedabad Partner

Date : 31/08/2012 Mem. No. 44093


Mar 31, 2010

We have audited the attached Balance Sheet of BODAL CHEMICALS LIMITED, as at 31st March, 2010 and also the Profit and Loss Account and the Cash Flow Statement of the Company 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.

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

2. As required by the Companies (Auditors Report) Order, 2003 as amended by The Companies (Auditors Report) Amendment Order, 2004 issued by the Central Government of Ufa in term/of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matter s di ecified in paragraphs 4 and 5 of the said order.

3. Further to our comments in the annexure referred to in paragraph 2 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 the books;

C. The Balance Sheet, Profit & Loss Account and 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 and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Sub-section 3 (c) of section 211 of the Companies Act, 1956 to the extent applicable.

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

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

(i) In case of Balance Sheet, of the state of affairs of the Company as at 31 st March, 2010

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

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

ANNEXURE TO THE AUDITORS REPORT (Annexure referred to in paragraph 2 of our Auditors Report of even date on financial statements of Bodal Chemicals Ltd for the year ended on 31/03/2010)

On the basis of such checks as we considered appropriate and in terms of the information and explanations given to us, we state that:-

1 a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of information available.

b) According to the information and explanation given to us, the Company has formulated a regular program of verification by which all the assets of the company shall be verified in a phased manner, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. To the best of our knowledge, no material discrepancies were noticed on the_verification conducted during the year as compared with the book records.

c) During the year the Company has not disposed off a substantial part of its fixed assets, so as to affect its going concern.

2 a) As explained to us, the inventory except stocks in transit has been physically verified during the year by the

Management at reasonable interval during the year. In our opinion the frequency of verification is reasonable.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the company and the nature of the business.

c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account.

3 a) According to the information and explanation given to us, the company had not granted any loans, secured or

unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act.

b) As the Company has not granted any loans to parties covered in the register maintained under Section 301 of the Companies Act, the clause of rates of interest and other terms & condition is not applicable to the Company.

c) As the Company has not granted any loans to parties covered in the register maintained under Section 301 of the Companies Act, the clause of repayment of principal amount is not applicable to the Company.

d) According to the information and explanations given to us, the Company had taken unsecured loan from the 3 (Three) parties listed in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 15.16 lacs & the year end balance of loans was Rs. 0.98 lacs.

e) According to the information and explanation given to us, repayment of the principal amount is as stipulated and payments of interest, wherever applicable, have been regular.

f) In our opinion the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

4 In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to the purchase of inventories and fixed assets, and with regard to the sale of goods. In our opinion and according to information and explanation given to us , there is no continuing failure to correct major weakness of such internal control system.

5 a) On the basis of the audit procedure performed by us, and according to the information given to us, we are of the

opinion that the transactions which were required to be entered in register maintained under Section 301 of Companies Act were entered.

b) In our opinion and according to the information and explanations given to us, the transactions were made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6 In our opinion and according to the information and explanation given to us, the company has not accepted deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

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

8 We have broadly reviewed the books of accounts and records maintained by the company relating to the manufacturing of Chemical products comprising Dyes & Dyes Intermediates 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 & maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

9 a) According to the records of the company and information and explanations given to us, the company is generally

regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Excise Duty, Custom Duty, Service Tax, Sales Tax, Cess, Investor Education and Protection Fund and any other material statutory dues as applicable to it, with the appropriate authorities during the year. As explained to us, no undisputed amounts payable were in arrears as at 31 st March 2010 for a period of more than six months from the date they became payable.

b) According to the information and explanation given to us, the Company had the following dues of Income Tax, Customs and Excise Duty which have not been deposited on account of any dispute.

Statement of Disputed Dues Name of the Statute Nature of Amount Period to which Forum where dispute the Dues (Rs. in Lacs) amount relates is pending

Income Tax/Act, 1961. Income Tax 0.19 A.Y. 1999-2000 Income Tax Appellate Tribunal

Income Tax 1.42 A.Y. 2004-2005 Assessing Officer

Income Tax 61.57 A.y. 2007-2008 Commissi oner of Income Tax (Appeal)

Central Excise Act, 1944. Penalty 0.77 A.Y. 2002-2003 CESTAT, Mumbai Penalty 6.82 A.Y. 2006-2007 The Comm. Of Central Excis (Appeals) Surat

Penalty 2.00 A.Y. 2009-2010 The Commis ioner (Appea ls), Central Excise - Ahmedabad

Service Tax 12.06 A.Y. 2006-2007 to The Comm issioner of Centra l Excise, Duty A.Y. 2010-2011 Ahmedabad

Duty 1.18 A.Y. 2010-2011 The Asst. Comm. Of Central Excise,

Ahmedabad -

Penalty 0.10 A.Y. 2010-2011 The Depu ty Comm. Of Central Excise, Ahmedabad_

The Custom Act,1962 Duty, Pena lty, 10.11 A.Y.2007-2008 CESTAT, Additional West Zonal Bench, Interest & Fine Ahmedabad.

10. The company has no accumulated losses at the end of the financial year. The company has not incurred any cash losses during current financial year. In the immediately preceding financial year, the Company had incurred cash loss.

11. According to the information and explanation given to us, the Company has not defaulted in repayment of dues to banks as at Balance sheet date. The Company has no transaction with financial institution.

12. According to the information and explanation given to us the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The provisions of any special statue applicable to chit fund, nidhi, or any mutual fund / societies are not applicable to the company.

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

15. According to the information and explanation given to us the Company has not given guarantee for loans taken by others from banks or financial institutions.

16. To the best of our knowledge and belief and according to the information and explanations given to, in our opinion, the term loans raised during the year were prima facie been utilized for the purposes for which they were obtained.

17. According to the information and explanations given to us and on overall examination of the balance sheet and cash flow statement of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

18. According to the information and explanations given to us, during the period covered by our audit report, the Company has not made preferential allotment of equity shares to par ies and companies covered in the register maintained under Section 301 of the Companies Act, 1956

19. The Company has unsecured debentures outstanding during the year on which no security or charge is required to be created.

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

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

FOR MAYANK SHAH & ASSOCIATES

CHARTERED ACCOUNTANTS (Firm Registration No. 106109W)

(M.S.SHAH)

PLACE : AHMEDABAD PARTNER

DATE : 29/05/2010 Mem. No. 44093








Mar 31, 2009

We have audited the attached Balance Sheet of BODAL CHEMICALS LIMITED., as at 31st March, 2009 and also the Profit and Loss Account and the Cash Flow Statement of the Company 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.

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

2. As required by the Companies (Auditors Report) Order, 2003 as amended by The Companies (Auditors Report) Amendment Order, 2004 issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

3. Further to our comments in the annexure referred to in paragraph 2 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 the books;

C. The Balance Sheet, Profit & Loss Account and 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 and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Sub-section 3 (c) of section 211 of the Companies Act, 1956 to the extent applicable.

E. On the basis of written representations received from the Directors, and taken on record by Board of Directors, we report that none of the Directors are disqualified as on 31st March, 2009 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, read together with the notes thereon, give the information required by the Companies Act, 1956 in manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India.

(i) In case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2009

(ii) In case of the Profit & Loss Account, of the loss for the year ended on that date and

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

ANNEXURE TO THE AUDITORS REPORT

(Annexure referred to in paragraph 2 of our Auditors Report of even date on financial statements of Bodal Chemicals Ltd for the year ended on 31/03/2009)

On the basis of such checks as we considered appropriate and in terms of the information and explanations given to us, we state that-

1 a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of information available.

b) According to the information and explanation given to us, the Company has formulated a regular program of verification by which all the assets of the company shall be verified in a phased manner, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. To the best of our knowledge, no material discrepancies were noticed on the verification conducted during the year as compared with the book records.

c) During the year the Company has not disposed off a substantial part of its fixed assets, so as to affect its going concern.

2 a) As explained to us, the inventory except stocks in transit has been physically verified during the year by the Management at reasonable interval during the year. In our opinion the frequency of verification is reasonable.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the company and the nature of the business.

c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account.

3 a) According to the information and explanation given to us, the company had not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act.

b) As the Company has not granted any loans to parties covered in the register maintained under Section 301 of the Companies Act, the clause of rates of interest and other terms & condition is not applicable to the Company.

c) As the Company has not granted any loans to parties covered in the register maintained under Section 301 of the Companies Act, the clause of repayment of principal amount is not applicable to the Company.

d) According to the information and explanations given to us, the Company had taken unsecured loan from the 4 (Four) parties listed in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.362.88 lacs & the year end balance of loans was Rs.15.13 lacs.

e) According to the information and explanation given to us, repayment of the principal amount is as stipulated and payments of interest have been regular.

f) In our opinion the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

4 In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to the purchase of inventories and fixed assets, and with regard to the sale of goods. In our opinion and according to information and explanation given to us, there is no continuing failure to correct major weakness of such internal control system.

5 a) On the basis of the audit procedure performed by us, and according to the information given to us, we are of the opinion that the transactions which were required to be entered in register maintained under Section 301 of Companies Act were entered. b) In our opinion and according to the information and explanations given to us, the transactions were made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6 In our opinion and according to the information and explanation given to us, the company has not accepted deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

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

8 We have broadly reviewed the books of accounts and records maintained by the company relating to the manufacturing of Chemical products comprising Dyes & Dyes Intermediates 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 & maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

9 a) According to the records of the company and information and explanations given to us, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Excise Duty, Custom Duty, Service Tax, Sales Tax, Cess, Investor Education and Protection Fund and any other material statutory dues as applicable to it, with the appropriate authorities during the year. As explained to us, no undisputed amounts payable were in arrears as at 31st March 2009 for a period of more than six months from the date they became payable. b) According to the information and explanation given to us, the Company had the following dues of Income Tax, Customs and Excise Duty which have not been deposited on account of any dispute.

Statement of Disputed Dues

Name of the Statute Nature of Amount Period to which the Dues (Rs. in Lacs) amount relates

Income Tax Act, 1961. Income Tax 0.19 A.Y. 1999-2000

Income Tax 4.63 A.Y. 1993-1994

Income Tax 1.42 A.Y. 2004-2005

Income Tax 13.04 A.Y. 2006-2007

The Central Excise Act, 1944 Penalty 6.82 A.Y.2006-2007

Penalty 0.77 A.Y. 2002-2003

Duty 1.47 A.Y.2007-2008

The Custom Act,1962 Duty, Penalty, 10.11 A.Y.2007-2008 Interest & Fine



Naem of the Statue Forum where dispute is pending

Income Tax Act, 1961. Income Tax Appellate Tribunal

Assessing Officer

Commissioner of Income Tax (Appeal)

The Central Excise Act, 1944 The Comm. Of Central Excise (Appeals)- Surat

CESTAT, Mumbai

Asst. Comm. Of Central Excise, Div-II, Ankleshwar.

The Custom Act,1962 CESTAT, Additional West Zonal Bench, Ahmedabad.

10 The company has no accumulated losses at the end of the financial year. The company has incurred cash losses during current financial year. In the immediately preceding financial year, the Company had not incurred any cash loss.

11 According to the information and explanation given to us, the Company has not defaulted in repayment of dues to banks as at Balance sheet date. The Company has no transaction with financial institution. As per consent of unsecured debenture holder, it has agreed not to claim any interest up to 31-03-2009 and company has agreed to pay interest @ 10% effective from 01-04-2009. Accordingly the Company has not defaulted in repayment of dues to debenture holder.

12 According to the information and explanation given to us the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13 The provisions of any special statue applicable to chit fund, nidhi, or any mutual fund / societies are not applicable to the company.

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

15. According to the information and explanation given to us the Company has not given guarantee for loans taken by others from banks or financial institutions.

16. To the best of our knowledge and belief and according to the information and explanations given to, in our opinion, the term loans raised during the year were prima facie been not utilized for the purposes other than for which they were obtained.

17. According to the information and explanations given to us and on overall examination of the balance sheet and cash flow statement of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

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

19. The Company has unsecured debentures outstanding during the year on which no security or charge is required to be created.

20. We have verified the end use of money raised by the Rights Issue of simultaneous issue of Equity Shares and Detachable Warrants convertible into Equity Shares as disclosed in Note 4 of Schedule 19 "Notes to Accounts"

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

FOR MAYANK SHAH & ASSOCIATES CHARTERED ACCOUNTANTS

(M.S.SHAH)

PLACE : AHMEDABAD PARTNER

DATE : 30/06/2009 Mem. No. 44093



 
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