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Auditor Report of Deccan Polypacks Ltd.

Mar 31, 2015

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

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Company's Act, 2013 ( "the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of Companies ( Accounts ) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting the fraud 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 the 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 Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements . The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error . In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give 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 other operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of 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 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 it's loss and it's cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to

a) Note 26 to the Financial Statements regarding suspension of manufacturing operations of the Company and preparation and presentation of financial statements on a going concern basis for the reasons stated in ;

b) Note 28 to the Financial Statements regarding impairment of assets for the reasons stated there in ;

c) Note 29 regarding to the Financial Statements accounting for stock loss and

d) Note 30 regarding not obtaining confirmation of balances from company's vendors and customers. Our opinion is not modified in this regard

Report on Other Legal and Regulatory Requirements

1 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 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, 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 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) The matter described under the Emphasis of Matter Paragraph above regarding the suspension of manufacturing operations of the Company and not obtaining confirmation of balances from the company's vendors and customers, in our opinion, may have an adverse effect on the functioning of the Company.

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

g) 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, to the best of our information and according to the explanations given to us and in our opinion;

i) the company has disclosed the impact of pending litigations on its financial position in its financial statements - Note 25 to the financial statements.

ii) the company does not have any long-term contracts including derivative contracts for which there are 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

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

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

II (a) The inventories have been physically verified during the year by the management at reasonable intervals. 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 inventory followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

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

iii) According to the information and explanations 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. Therefore clause 3 (iii) of the Order is not applicable.

(iv) in our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and nature of its business , with regard to the purchase of inventory and fixed assets and for the sale of goods and services. In our opinion according to the information and explanation given to us, there has been no continuing failure to correct major weaknesses in internal control system during the year.

v) According to the information and explanations given to us, the Company has not accepted deposits from the Public under the provisions of Section 73 and Section 74 of the Act and the rules framed there under. Therefore, the provisions of clause 3(v) of the Order are not applicable.

vi) On the basis of records produced to us, we are of the opinion that prima facie the cost records and accounts prescribed by the Central Government under Section 148 (1) of the Companies Act, 2013 have been maintained . However, we are not required to and have not carried out any detailed examination of such accounts and records.

vii) (a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, undisputed statutory dues including Provident Fund, Employees' State Insurance, Income Tax, Sales-Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Cess, Investor Education and Protection Fund and any other statutory dues as applicable, have been regularly deposited during the year with the appropriate authorities in India. There are no arrears of Statutory dues as at 31st March 2015 which are outstanding for a period more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the company examined by us, there are no dues on account of Providnet Fund, Employees' State Insurance , Income Tax , Sales Tax. Wealth Tax , Serivce Tax, Customs Duty, Excise Duty, Value Added Tax, Cess, Investor Education and Protection Fund as at 31st March, 2015 which have not been deposited on account of any dispute except stated below

Name of Nature of Dues Amount Forum Where dispute the statute (Rs. In Lakhs) is pending

Sales Restriction of set off tax on 3.60 Appellate Tribunal,

Tax prorate basis Andhra Pradesh

(viii) The Company has no accumulated losses as at the end of the financial year. The Company has incurred cash losses during the period coverd by the report and immediately preceding the period covered by the report

(ix) According to the information and explanations given to us and in our opinion, as at March 31, 2015, there were no default in repayment of dues to banks. The Company has not issued any debentures.

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

(xi) In our opinion and according to the information and explanation given to us, the loans availed by the Company from banks have been applied for the purposes for which they were obtained.

(xii) During the course of our examinations of the books and records of the Company carried out in accordance with the generally accepted practices in India and according to the information and explanations given to us , no instance of fraud on or by the company was noticed or reported during the year, nor have we been informed of such case by the management.

for M.Bhaskara Rao & Co.,

Chartered Accountants

Firm Registration No : 000459S



V K Muralidhar

Partner

Place: : Hyderabad Membership No 201570


Mar 31, 2013

Report on Financial Statements:

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

Management''s Responsiblility 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 Companies Act, 1956. 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 misstatment, 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 misstatment.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the - financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal controls. 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, 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 theCompany as atMarch 31,2013.

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") 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 kndwledge 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;

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 comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

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

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

c) In our opinion, the company has not disposed off a substantial part of fixed assets during the year and the going concern status of the company is not affected.

ii) a) The inventories have been physically verified during the year by the management at reasonable intervals. In our opininon 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 inventory followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

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

iii) a) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Hence, clause (iii) (b) to (d) of paragraph 4 of the Companies (Auditor''s Report) Order 2003, as amended is not applicable to the Company for the current year.

e) According to the information and explanations given to us, the Company has taken interest free unsecured loan from six parties covered in Register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 153.50 lakhs and year end balance was Rs. 32.50 Lakhs

f) Since the loans taken are repayable on demand, question of overdue amounts does not arise. Therefore commenting under Clause 4 (iii) (g) of Companies (Auditor''s Report) Order, 2003 as amended does not arise.

iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and nature of its business, with regard to the purchase of inventory and fixed assets and for the sale of goods and services. In our opinion according to the information and explanation given to us, there has been no continuing failure to correct major weaknesses in internal control system during the year.

v) a) In our opinion and according to the information and explanations given to us, and based on the representations by the management, there are no transactions that needs to be entered into the register in pursuance of Section 301 of the Companies

Act, 1956. Accordingly clause (v) (b) of this order is not applicable to the Company for the current year.

vi) In our opinion and according to information and explanation given to us, the company has not accepted Deposits from public and as such the provisions of .Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public are not applicable to the company.

vii) The Internal Audit of the Company has been conducted by a Firm of Chartered Accountants.

The scope and coverage of Internal Audit needs * to be enlarged and strengthened keeping in view the size of the Company and nature of its business.

viii) In our opinion and as per the information and explanations given to us, and as informed by the company, the Central Government has not prescribed the maintenance of cost records under Section 209( 1) (d) of the Companies Act, 1956 for the products of the company.

ix) a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales - Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues as applicable, have been regularly deposited during the year with the appropriate authorities in India. There are no arrears of Statutory dues as at 31st March 2013 which are outstanding for a period more than six months from the date they became payable

b) According to the information and explanations given to us and the records of the company examined by us, there are no dues oh account of Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty , Cess as at 31 st March 2013 which have not been deposited on account of any dispute except stated below.

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

Sales Restriction of Set off, 3.60 Appellate Tribunal Tax tax on prorate basis Andhra Padesh

x) The Company has no accumulated losses as on 31st March 2013. Further it has ''not incurred cash losses in the financial year under report and in the immediately preceding financial year.

xt) Based on our Audit procedures and as per the information and explanation given by the management, we are of the opinion that the company has not defaulted in repayment of dues to a financial institutions or bank or debenture holders during the financial year under report.

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

xiii) In our opinion, the company is not a Chit Fund/ Nidhi / Mutual Benefit Fund / Society and hence commenting under this clause does not arise.

xiv) In our opinion and according to the information and explanation given to us, the company does not deal or trade in shares, securities, debentures and other investments.

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

xvi) The company has not obtained any term loans from banks/ financial institutions during the year. Hence commenting under this clause does not arise.

xvii) On die basis of an overall examination of die Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, funds raised on short - term basis Tiave not been used for long-term purpose.

xviii) During die year under report die company has not made any preferential allotment of shares to parties and companies covered in die register maintained under Section 301 of me Companies Act, 1956

xix) The Company has not issued any debentures during die year and hence commenting under mis clasue does not arise.

xx) The company has not raised any money by public issue during die year and hence commenting under mis clause does not arise.

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

for M. BHASKAR RAO & CO.,

CHARTERED ACCOUNTANTS

Place : Hyderabad VRAGHUNANDAN

Date: 30.05.2013 Partner

Membership No. 26255

Firm Regn. No. 000459S


Mar 31, 2012

We have audited the attached Balance Sheet of Deccan Polypacks Limited, as at 31st March, 2012, the Statement of Profit & Loss and Cash Flow Statement of the company for the year ended on that date annexed thereto. These financial statements are responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the management, as well as evaluating overall financial statement presentation. We believe that our audit provides a reaonable basis for our opinion.

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

2. Further to our comments in the Annexure referred to in paragraph (1) above, we report that:

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

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

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

d) In our opinion, the Balance Sheet, Statement of Profit & Loss and Cash Flow Statement comply with the accounting standards referred to in Sub-section (3C) of Section 211 of Companies Act, 1956

e) On the basis of written representations ' received from the Directors as on 31 st March,

2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2012 from being appointed as Directors 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 Balance Sheet, Statement of Profit & Loss and Cash Flow Statement read with notes thereon and the significant accounting policies give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

n) in the case of the 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 Flows for die year ended on that date.

Annexure to the Auditors'Report

(Statement Referred To in Paragraph (1) 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) These fixed assets were physically verified by die Management during the year. We have been informed that no material discrepancies were noticed on such physical verification.

c) In our opinion, the company has not disposed off a substantial part of fixed assets during the year and the going concern status of the company is not affected.

ii) a) The inventories have been physicglly verified during the year by me management , at reasonable intervals. In our opininon 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 inventory followed by die management are reasonable and adequate in relation to the size of the company and nature of its business.

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

iii) a) According to the information and explanations given to us, the company has granted loans to six parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during die year was Rs. 170 lakhs and die year end balance of such loans was Rs.25 Lakhs.

The Company has taken interest free un secured loans from five parties covered in register maintained under Section 301 of the Companies Act 1956. The maximum amount involved during the year was Rs.32.51 Lakhs and the year end balance was Rs. 32.50 Lakhs

b) The rate of interest and other terms and conditions of loans given or taken by the company, secured or unsecured, are not prima facie prejudicial to the interest of the company.

c) Since the loans taken are repayable on demand, question of overdue amounts does not arise.

d) In the absence of amounts becoming overdue, commenting under tius clause does not arise.

iv) In our opinion and according to the information and explanations given to us, mere is adequate internal control system commensurate with the size of me Company and nature of its business, witii regard to die purchase of inventory and fixed assets and for the sale of goods and services. In our opinion according to the information and explanation given to us, there has been no continuing failure to correct major weaknesses in internal control system during the year.

v) a) In our opinion and according to the information and explanations given to us, - and based on the representations by the management, there are no transactions (except loans mentioned under clasue (iii) above ) that needs to be entered into the register in pursuance of Section 301 of the Companies Act, 1956. Accordingly clause (v) (b) of this order is not applicable to the Company for the current year.

vi) In our opinion and according to information and explanation given to us, the company has not accepted Deposits from public and as such the provisions of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public are not applicable to the company.

vii) The Internal Audit of the Company has been conducted by a Firm of Chartered Accountants. The Scope and coverage of Internal Audit needs to be enlarged and strengthened keeping in view the size of the Company and nature of its business.

viii) In our opinion and as per the information and explanations given to us, and as informed by the company, the Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for the products of the company.

ix) a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales - Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues as applicable, have been regularly deposited during the year with the appropriate authorities in India. There are no arrears of Statutory dues as at 31 st March 2012 which are outstanding for a period more than six months from the date they became payable

. b) According to the information and emanations given to us and the records of the company examined by us, there are no dues on account of Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty , Cess as at 31st March 2012 which have not been deposited on account of any dispute except stated below.

Name of Amount Forum Where

the Statute Nature of Dues (Rs. In Dispute

lakhs) is Pending

Sales Restriction of Set off 5.41 Appellate Tribunal

Tax tax on prorate basis Andhra Padesh

x) The Company has no accumulated losses as on 31st March 2012. Further it has not incurred cash losses in the financial year under r%port and n the immediately preceding financial year.

m) Based on our Audit procedures and as per the information and explanation given by the management, we are of the opinion that the company has not defaulted in repayment of dues to a financial institutions or bank or debenture holders during the financial year under report.

xi) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities

xiii) In our opinion, the company is not a Chit Fund/ Nidhi / Mutual Benefit Fund / Society and hence commenting under this clause does,, not arise.

xiv) In our opinion and according to the information and explanation given to us, the company does not deal or trade in shares, securities, debentures and other investments.

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

xvi) The company has not obtained any term loans from banks/ financial institutions during the year. Hence commenting under this clause does not arise.

xvii) On the basis of an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, funds raised on short - term basis have not been used for longterm purpose.

xviii) During the year under report the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956

xix) The Company has not issued any debentures during the year and hence commenting under this clasue does not arise.

xx) The company has not raised any money by public issue during the year and hence commenting under this clause does not arise.

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

for M. BHASKAR RAO & CO.,

CHARTERED ACCOUNTANTS

Place : Hyderabad VRAGHUNANDAN

Date: 30.05.2012 Partner

Membership No. 26255 FirmRegn. No. 000459S


Mar 31, 2010

We have audited the attached Balance Sheet of Deccan Polypacks Limited, as at 31st March, 2010, the Profit & Loss Account and Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the management, as well as evaluating overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

2. Further to our comments in the Annexure referred to in paragraph (1) 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 purposes of our audit;

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

c) The Balance Sheet, Profit and 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 comply with the accounting standards referred to in Sub-section (3C) of Section 211 of Companies Act, 1956

e) On the basis of written representations received from the Directors as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2010 from being appointed as Directors 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 Balance Sheet and the Profit & Loss Account, and Cash Flow Statement read with notes thereon and the significant accounting policies give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

Annexure to the Auditors Report (Statement Referred To in Paragraph (1) 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) These fixed assets were physically verified by the Management during the year. We have been informed that no material discrepancies were noticed on such physical verification.

(c) In our opinion, the company has not disposed off a substantial part of fixed assets during the year and the going concern status of the company is not affected.

ii) (a) The inventories have been physically verified during the year by the management at reasonable intervals. 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 inventory followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

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

iii) (a) According to the information and explanations given to us, the company has granted loan to a party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year end balance of such loan was Rs. 41.83 lakhs.

The Company has taken interest free unsecured loans from eight parties covered in register maintained under Section 301 of the Companies Act 1956. The maximum amount involved during the year in respect of loans taken in the previous years is Rs.40.51 lakhs and the year end balance was Rs.32.51 lakhs.

(b) The rate of interest and other terms and conditions of loans given or taken by the company, secured or unsecured, are not prima facie prejudicial to the interest of the company.

(c) Since the loans taken are repayable on demand, question of overdue amounts does not arise.

(d) In the absence of amounts becoming overdue, commenting under this clause does not arise.

iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and nature of its business, with regard to the purchase of inventory and fixed assets and for the sale of goods and services. In our opinion according to the information and explanation given to us, there has been no continuing failure to correct major weaknesses in internal control system during the year.

v) (a) In our opinion and according to the information and explanations given to us, and based on the representations by the management, there are no transactions (except loans mentioned under clause (iii) above) that needs to be entered into the register in pursuance of Section 301 of the Companies Act, 1956. Accordingly clause (v) (b) of this order is not applicable to the Company for the current year,

vi) In our opinion and according to information and explanation given to us, the company has not accepted Deposits from public and as such the provisions of Section 58 A and 58 AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public are not applicable to the company.

vii) The Internal Audit of the Company has been conducted by a Firm of Chartered Accountants. The scope and coverage of Internal Audit needs to be enlarged and strengthened keeping in view the size of the Company and nature of its business.

viii)In our opinion and as per the information and explanations given to us, and as informeil b the company, the Central Government has not prescribed the maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956 for the products of the company.

ix) (a) According to the information and explanations given to us and according to the books and records as produced and examined by us, in our opinion, 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, C^ss and any other statutory dues as applicable, have been regularly deposited during the year with the appropriate authorities in India. There are no arrears of Statutory dues as at 31st March 2010 which are outstanding for a period more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the company examined by us, there are no dues on account of Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess as at 31s* March 2010 which have not been deposited on account of any dispute.

x) The Company has no accumulated losses as on 31st March 2010. Further it has.not incurred cash losses in the financial year under report and in the immediately preceding financial year.

xi) Based on our Audit procedures and as per the information and explanation given by the management, we are of the opinion that the company has not defaulted in repayment of dues to a financial institutions or bank or debenture holders during the financial year under report.

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

xiii) In our opinion, the company is not a Chit Fund / Nidhi / Mutual Benefit Fund / Society and hence commenting under this clause does not arise.

xiv) In our opinion and according.to information * and explanation given to us, the company does not deal or trade in shares, securities, debentures and other investments.

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

xvi) The Company has not obtained any term loans from banks / financial institutions during the year. Hence commenting under this clause does not arise.

xvii) On the basis of an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, funds raised on short-term basis have not been used for long- term purposes.

xviii) The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956 during the year.

xix) The Company has not issued any debentures during the year and hence commenting under this clause does not arise.

xx) The Company has not raised any money by public issue during the year and hence commenting under this clause does not arise.

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

for M. BHASKARA RAO & CO.,

CHARTERED ACCOUNTANTS

Place: Hyderabad V RAGHUNANDAN

Date : 31.05.2010 Partner

Membership No. 26255

FirmRegn.No. 000459S





 
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