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Auditor Report of Denis Chem Lab Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of DENIS CHEM LAB 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 Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements 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 financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements 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 the 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 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. 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 financial statements.

Opinion

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

i. in the case of the balance sheet, of the state of affairs of the Company as at 31st March 2015;

ii. in the case of the statement of profit and loss, of the profit for the year ended on that date; and

iii. in the case of the cash flow statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by 'the Companies (Auditor's Report) Order, 2015', issued by the Central Government of India in terms of sub-section (11) of section 143 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 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 on its financial position in its financial statements.

ii. In our opinion and as per the information and explanations provided to us, the Company has not entered into any long-term contracts including derivative contracts, requiring provision under applicable laws or accounting standards.

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

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE AUDITORS' REPORT ON ACCOUNTS FOR THE YEAR ENDED 31st MARCH, 2015

1. a) The company is in the process of compiling and preparing records showing full particulars, including quantitative details and situation of fixed assets.

b) As explained to us, all the fixed assets have been physically verified by the management at the end of the year. However in the absence of records of fixed assets; material discrepancies, if any could not be found on such verification the said fixed assets.

2. a) Physical verification has been conducted by the management at reasonable intervals in respect of finished goods, raw materials & work-in-progress & stores & spares.

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

c) In our opinion the Company is maintaining proper records of inventories. The discrepancies noticed on such verification between the physical stocks and book records were not significant and the same have been properly dealt with in the books of account.

3. As informed to us the company has not granted loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act,2013.

4. In our opinion 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 the sale of goods and services. During the course of audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. According to the information and explanations given to us the company has not accepted any deposits, in terms of the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under.

6. We have broadly reviewed the cost records maintained by the company and are of the opinion that prima facie, the prescribed accounts and cost records have been maintained. We have, however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.

7. a) As per information and explanations given to us, the company is not regular in depositing undisputed statutory dues including provident fund, employees' state insurance, income tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues with the appropriate authorities. There are no outstanding statutory dues as at the last day of the financial year under audit for a period of more than six months from the date they became payable except for a sum of Rs. 36,55,070/- for Service Tax.

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

Disputed Dispute Financial Amount liability in pending Year involved respect of before (Rs.)

CST Commissioner of 2005-06 74,41,721/- Commercial Tax, (Appeals)

GST Commissioner of 2005-06 5,93,005/- Commercial Tax, (Appeals)

CST Commissioner of 2004-05 12,91,963/- Commercial Tax, (Appeals)

VAT Commissioner of 2004-05 7,91,085/- Commercial Tax, (Appeals)

Income Commissioner of 2010-11 3,55,690/- Tax Income Tax, (Appeals)

Income Commissioner of 2011-12 9,40,590/- Tax Income Tax, (Appeals)

8. There are no accumulated losses of the company as at the end of the year. The company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

9. Based on our audit procedures and on the basis of information and explanations given to us by the management, we are of the opinion that there is no default in repayment of dues to the banks as at the year end.

10. According to information and explanations given to us the Company has not given any guarantee for loan taken by others from banks or financial institutions, the terms and conditions whereof are prejudicial to the interest of the company.

11. Term loans obtained by the company in earlier years have been utilized for the purpose for which they were obtained.

12. Based upon the audit procedures performed and information and explanations given by the management, we report that, no fraud on or by the Company has been noticed or reported during the course of our audit for the year ended 31.03.2015.

For SHAH & SHAH ASSOCIATES Chartered Accountants FRN:113742W

Place: Ahmedabad NIMISH B SHAH Date : 19th May, 2015 PARTNER Membership Number: 30102


Mar 31, 2014

We have audited the accompanying Financial Statements of DENIS CHEM LAB LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2014, Statement of Profit & Loss and Cash Flow Statement for the year then ended and summary of Significant Accounting Policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, 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 misstatements, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with standard 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 risk 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 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 read with Accounting Policies and Notes thereon give, the information required by the Companies Act, 1956 (the Act) in the manner so required and give, a true and fair view in conformity with the accounting principles generally accepted in India;

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

ii) in the case of the Statement of Profit & Loss, of the Profit for the year ended on 31st March, 2014; and

iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on 31st March, 2014.

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 section 227(4A) of the Companies Act, 1956, we give in the annexure, a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

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

(ii) In our opinion, proper books of account as required by law have been kept by the company so far as appears from our examination of these books

(iii) The Balance sheet, the statement of Profit & Loss and the Cash Flow Statement dealt with by this report are in agreement with the books of account.

(iv) In our opinion, these financial statements have been prepared in compliance with the applicable accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

(v) On the basis of written representation received from the directors as on 31st March, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2014 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies 1956.

ANNEXURE TO THE AUDITORS'' REPORT

(Referred to in paragraph 1 under the heading ''Report on other, Legal and Regulatory Requirements'' of our Report of even date to the members of DENIS CHEM LAB LIMITED)

1. In respect of its fixed assets:

a) The company is in the process of compiling and preparing records showing full particulars, including quantitative details and situation of fixed assets.

b) As per the explanation provided to us, the fixed assets have been physically verified by the management at the end of the year. However in the absence of records of fixed assets; material discrepancies, if any could not be found on such verification the said fixed assets.

c) In our opinion, and according to the information and explanations given to us, the company did not dispose off its substantial part of fixed assets during the year.

2. In respect of its inventories

a) As per explanation provided to us, inventories have been physically verified by the management at regular intervals 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 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 inventories. The discrepancies noticed on verification between the physical stocks and the book records were not material.

3. a) According to the information and explanations given to us, the company has not granted any loans to parties covered under section 301 of the Companies Act, 1956.

b) The company has taken interest free unsecured loans from two directors. The maximum amount involved during the year is Rs. 4,89,84,462/- and the year-end balance of loans taken from such parties is Rs. 4,73,33,462/-.

c) The other terms and conditions of the loans taken by the company are prima facie not prejudicial to the interest of the company.

d) No stipulations have been made for repayment of these loans.

4. In our opinion and according to the information and explanations 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 purchase of inventory and fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

5. a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 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 prevailing market prices at the relevant time as evaluated on the basis of quotations obtained from parties/ prices charged by the company in case of similar transactions during the year.

6. The company has not accepted any deposits from public; hence the compliance of the provisions of Sec. 58A and 58AAA does not arise.

7. The company has an internal audit system. However there is scope for increasing the coverage so as to make it commensurate with the size and nature of business of the company.

8. We have broadly reviewed the cost records maintained by the company and are of the opinion that prima facie, the prescribed accounts and cost records have been maintained. We have, however, not 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 and other dues:

a) The company is not regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, service tax, excise duty, custom duty cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income tax, sales tax, service tax, excise duty, custom duty cess and other statutory dues were outstanding as at March 31, 2014 for a period of more than six months from the date of becoming payable.

c) According to the records of the company the dues outstanding of sales tax, income tax, service tax, custom duty, excise duty and cess on account any dispute, are as follows:

Disputed liability Dispute pending before Financial Amount in respect of Year involved (Rs.)

CST Commissioner of Commercial 2005-06 74,41,721/- Tax, (Appeals)

GST Commissioner of Commercial 2005-06 5,93,005/- Tax, (Appeals)

CST Commissioner of Commercial 2004-05 12,91,963/- Tax, (Appeals)

VAT Commissioner of Commercial 2004-05 7,91,085/- Tax, (Appeals)

VAT Commissioner of Commercial 2006-07 34,127/- Tax, (Appeals)

Income Tax Commissioner of Income 2010-11 3,55,690/- Tax, (Appeals)

10. The company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year.

11. The company has not borrowed from financial institution or bank or by way of issue of debentures. The question of default in repayment of such borrowed funds does not arise.

12. 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 special statute applicable to chit fund, Nidhi/Mutual Benefit Fund/Societies are not applicable to the company.

14. The company is not dealing or trading in shares, securities, debentures and other investments and accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003, are not applicable to the company.

15. According to information and explanations given to us, the company has not given guarantee for loans taken by others from bank or financial institutions.

16. On the basis of review of utilization of funds pertaining to term loans on overall basis and related information as made available to us, the term loans taken by the company were applied during the year for the purpose for which they were obtained.

17. Funds raised on short term basis have not been applied for long-term investment.

18. The company has not made any preferential allotment of shares to parties or companies covered in the Register maintained u/s. 301 of the Companies Act, 1956.

19. The company has not issued any debentures.

20. The company has not raised money by any public issues.

21. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the company was noticed or reported during the year.

For SHAH & SHAH ASSOCIATES Chartered Accountants Firm Registration No. 113742W

NIMISH B. SHAH Place : Ahmedabad. Partner Date : 29th May, 2014 Membership Number: 30102

 
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