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Auditor Report of Dhampur Sugar Mills Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of Dhampur Sugar Mills Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement, and a summary of the significant accounting policies and other explanatory information for the year then ended,in which are incorporated the Reports for the year ended on that date audited by the branch auditors of the Company''s Meerganj Unit.

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 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.

Auditors''Responsibility

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

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

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. ThoseStandards require that we comply withethical 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, includingthe 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 bytheCompany''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 ourqualifiedaudit opinionon the standalone financial statements.

Opinion

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

Emphasis of Matters

We draw attention to the Note No. -"26 (b)" of the annexed financial statements which explains the reasons for recognition of subsidy announced by the Government of Uttar Pradesh.

Our opinion is not modified in respect of this matter.

Other Matter

We did not audit the financial statements of Meerganj Unit included in the standalone financial statements of the Company whose financial statements reflect total assets of Rs. 274.19 Crores as at 31st March, 2015 and total revenues of Rs. 114.84 Crores for the year ended on that date, as considered in the standalone financial statements. The financial statements of Meerganj Unit have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these branches, is based solely on the report of such branch auditors.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor''s Report) Order, 2015 ("the Order"), issued by the Central Government of India in terms of section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

As required by Section143(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 reports on the accounts of the Meerganj Unit of the Company audited under Section 143 (8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

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

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

(f) On the basis of the written 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.

(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, 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. (Refer Note No. -"38")

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

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

Annexure to the Independent Auditors'' Report

The Annexure referred to in our Independent Auditors'' Report to the members of the Company on the standalone financial statements for the year ended 31st March, 2015, we report that:

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

(b) The Company has a phased programme of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. The management has verified major fixed assets during the year and as explained there is no any material discrepancy on such verification.

ii) (a) The inventories have been physically verified during

the period by the management. In our opinion, the frequency of verification of inventory is reasonable.

(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 inventories. As explained to us, no material discrepancies were noticed on physical verification of inventories as compared to book records.

iii) (a) The Company had granted unsecured loans to Six companies covered in the register maintained under section 189 of the Companies Act,2013 ("the Act").

(b) In the case of the loans granted to companies listed in the register maintained under section 189 of the Act, the borrowers are regular in the payment of the interest, as stipulated. The terms of arrangements do not stipulate any repayment schedule and the loans are repayable on demand. Accordingly, paragraph 3(iii)(b) of the Order is not applicable to the Company in respect of repayment of the principal amount.

(c) There are no overdue amount of more than rupees one lakh in respect of the loans granted to company listed in the register maintained under section 189 of the Act.

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 nature of its business with regard to purchase of inventory and sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

v) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Act and rules framed there under. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal in this connection.

vi) The company has made and maintained cost records pursuant to section 148 (1) of the Companies Act, 2013.

vii) (a) As explained to us, the statutory dues payable by the Company comprises mainly of Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax (VAT), Wealth-tax, Service-tax, Custom Duty, Excise Duty, Cess, Entry tax, Purchase tax and other material statutory dues applicable to it. According to the records of the Company and information and explanations given to us, the Company has been generally regularly depositing the aforesaid undisputed statutory dues with the appropriate authorities. There are no undisputed statutory dues as referred to above as at 31st March,2015 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us, the particulars of Income tax, Service-tax, Sales- tax (VAT), Custom Duty, Excise Duty, Entry tax, Stamp duty and other statutory material dues, which have not been deposited on account of any dispute, are as referred to in the details of Contingent Liabilities in Note No."38"

(c) According to the information and explanations given to us the amounts which are required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act,1956 (1 of 1956) and rules made thereunder has been transferred to such fund within time.

viii) The accumulated losses of the company at the end of the financial year are less than 50% of its net worth.The Company has not incurred cash losses during the financial year but has incurred cash losses in the immediately preceding financial year.

ix) In our opinion and according to the information and explanations given to us, there is no default in repayment of dues to any Financial Institution and Bank during the period under report, as per the terms of the respective loans.

x) In our opinion, the terms and conditions of guarantees given the company for loans taken by others from banks are not prima facie prejudicial to the interest of the Company.

xi) The term loans obtained by the Company have been applied for the purposes for which they were obtained.

xii) To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company was noticed or reported during the course of our audit.

For S. Vaish & Co., For Mittal Gupta & Co., Chartered Accountants Chartered Accountants FRN00001C FRN01874C

(S.P. Agrawal) (B. L. Gupta ) Partner Partner Membership No. 07269 Membership No. 073794

Place : Kanpur Dated : 27th May, 2015


Mar 31, 2014

We have audited the accompanying financial statements of Dhampur Sugar Mills Limited (''the Company'') which comprise the Balance Sheet as at 31st March, 2014, 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 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 principles generally accepted in India including Accounting Standards referred to in section 211(3C) of the Companies Act, 1956 ("the Act") [which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs]. 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 misstatements.

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. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

(i) in the case of the Balance Sheet, of the State of Affairs of the unit as at 31st March 2014;

(ii) in the case of the Statement of Profit and Loss, of the Loss 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, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of section 227(4A) 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, 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 section 211(3C) of the Act;

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

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

Other Matter

We did not audit the financial statements of Meerganj Unit whose financial statements reflect total assets of Rs. 232.20 Crores as at 31st March, 2014 and total revenue of Rs. 197.97 Crores during the financial year. The financial statements of Meerganj unit are audited by the other auditors. In conduct of our audit, we have taken note of accounts audited by other auditors.

Annexure to the Independent Auditors'' Report

The Annexure referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Dhampur Sugar Mills Limited (the Company) for the year ended 31st March, 2014:

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

(b) The fixed assets have been physically verified by the management at the end of the period. In our opinion the frequency of verification is reasonable considering the size of the Company and nature of its business.

(c) The Company has not disposed off a substantial part of its fixed assets during the period and the going concern status of the Company is not affected.

ii) (a) The inventories have been physically verified during the period by the management. In our opinion, the frequency of verification of inventory is reasonable.

(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 inventories. As explained to us, no material discrepancies were noticed on physical verification of inventories as compared to book records.

iii) (a) The Company had granted interest free unsecured loans/advances to one company covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 0.11 Crores.

- The year end balance due is Rs. 0.11 Crores.

(b) In our opinion, the other terms and conditions on which interest free unsecured loans/advances have been granted to a company listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(c) The payments of principal amount are regular, wherever stipulated.

(d) There is no overdue amount of loans/advances, more than rupee one lac, granted to company listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company had taken interest free unsecured loans/advances from seven companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 2.26 Crores.

- The year end balance due is Rs. 0.12 Crores.

(f) In our opinion, the other terms and conditions on which interest free loans/advances have been taken from companies listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) The payments of principal amount are regular, wherever stipulated.

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

v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contract or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered into the register maintained under section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements exceeding the value of rupees five lac in respect of each party during the period have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A and section 58AA of the Companies Act, 1956 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 public. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii) We have broadly reviewed the cost accounting records maintained by the company pursuant to Companies (Cost Accounting Records) Rules 2011 prescribed by Central Government under section 209 (1) (d) of Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained.

We have, however, not made a detailed examination of cost records with a view to determine whether they are accurate or complete.

ix) (a) As explained to us, the statutory dues payable by the Company comprises mainly of Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax (VAT), Wealth-tax, Service-tax, Custom Duty, Excise Duty, Cess, Entry tax, Purchase tax and other material statutory dues applicable to it. According to the records of the Company and information and explanations given to us, the Company has been generally regularly depositing the aforesaid undisputed statutory dues with the appropriate authorities. There are no undisputed statutory dues as referred to above as at 31st March,2014 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us, there were no dues on account of Income Tax and Wealth Tax which were not deposited on account any dispute. However, the particulars of Service-tax, Sales-tax (VAT), Custom Duty, Excise Duty, Entry tax, Stamp duty and other statutory material dues, which have not been deposited on account of any dispute, are as referred to in the details of Contingent Liabilities in Note No.

"36"

x) The accumulated losses of the company at the end of the financial year are less than 50% of its net worth. The Company has incurred cash losses during the financial year covered by the audit but not incurred any cash loss in the immediately preceding financial year.

xi) In our opinion and according to the information and explanations given to us, there is no default in repayment of dues to any Financial Institution and Bank during the period under report, as per the terms of the respective loans.

xii) In our opinion and according to the information and explanations given to us, the Company has not granted 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 or a nidhi/ mutual benefit fund/ society; as such the provisions of paragraph 4(xiii) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments, accordingly the provisions of paragraph 4 (xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xv) In our opinion, the Company has not given any guarantees for loans taken by others from banks or financial institutions; as such the provisions of paragraph 4(xv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xvi) The term loans obtained by the Company have been applied for the purposes for which they were obtained.

xvii)According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that as at 31st March, 2014, short-term funds of Rs. 301.63 Crores have been used for long term uses.

xviii)In our opinion, the price at which preferential allotment of 30,00,000 Equity share warrants has been made to the parties covered in the register maintained under section 301 of the Companies Act, 1956 is not prejudicial to the interest of the company.

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

xx) The Company has not raised any money during the period by public issue.

xxi) To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company was noticed or reported during the course of our audit.

For S. Vaish & Co., For Mittal Gupta & Co.,

Chartered Accountants Chartered Accountants FRN 00001C FRN 01874C

(S.P. Agrawal) (B. L. Gupta )

Partner Partner

Membership No. 07269 Membership No. 073794

Place : Kanpur

Dated : 21st May, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying revised financial statements of Dhampur Sugar Mills Limited (‘the Company'') which comprise the Balance Sheet as at 31st March, 2013, 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. The original financial statements of the Company for the year ended March 31, 2013 were audited by us and our audit report dated May 21, 2013 expressed an unqualified opinion in the same. The original financial statements were prepared without giving effect to the Scheme of Amalgamation of J.K. Sugar Limited with the company, since the order of the Hon''ble High Court of Judicature at Calcutta was not received till that date. In order to give effect to the Scheme of the aforesaid amalgamation, which has become effective on July 16, 2013 from the appointed date i.e. April 01,2012 as approved by the Hon''ble High Court of Judicature at Allahabad vide order dated 18.03.2013 and Hon''ble High Court of Judicature at Calcutta vide order dated 17.05.2013 as explained and referred to in Note No. 1.A, these financial accounts have now been revised by the Company.

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 principles generally accepted in India including Accounting Standards referred to in section 211(3C) 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 misstatements.

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. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

(i) in the case of the Balance Sheet, of the State of Affairs of the unit as at 31st March 2013;

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of section 227(4A) 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, 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 section 211(3C) of the Act;

e. On the basis of the written representations received from the directors as on March, 31, 2013, 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 Section 274(1)(g) of the Act.

Annexure to the Independent Auditors'' Report

The Annexure referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Dhampur Sugar Mills Limited (the Company) for the year ended 31st March, 2013 :

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

(b) The fixed assets have been physically verified by the management at the end of the period. In our opinion the frequency of verification is reasonable considering the size of the Company and nature of its business.

(c) The Company has not disposed off a substantial part of its fixed assets during the period and the going concern status of the Company is not affected.

ii) (a) The inventories, except stores, have been physically verified during the period by the management. In our opinion, the frequency of verification of inventory, except stores, is reasonable.

(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 inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to book records.

iii) (a) The Company had granted interest free unsecured loans/advances to two companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 25.33 crore.

- The year end balance due is Rs. 0.11 crore.

(b) In our opinion, the other terms and conditions on which interest free unsecured loans/advances have been granted to a company listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(c) The payments of principal amount are regular, wherever stipulated.

(d) There is no overdue amount of loans/advances, more than rupee one lac, granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company had taken interest free unsecured loans/advances from five companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 17.81 crore.

- The year end balance due is Rs. 0.78 crore.

(f) In our opinion, the other terms and conditions on which loans/advances have been taken from companies listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) The payments of principal amount are regular, wherever stipulated.

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

v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contract or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered into the register maintained under section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements exceeding the value of rupees five lac in respect of each party during the period have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A and section 58AA of the Companies Act, 1956 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 public. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii) We have broadly reviewed the cost accounting records maintained by the company pursuant to Companies (Cost Accounting Records) Rules 2011 prescribed by Central Government under section 209 (1) (d) of Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of cost records with a view to determine whether they are accurate or complete.

ix) (a) As explained to us, the statutory dues payable by the Company comprises mainly of Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax (VAT), Wealth- tax, Service-tax, Custom Duty, Excise Duty, Cess, Entry tax, Purchase tax and other material statutory dues applicable to it. According to the records of the Company and information and explanations given to us, the Company has been generally regularly depositing the aforesaid undisputed statutory dues with the appropriate authorities. There are no undisputed statutory dues as referred to above as at 31st March,2013 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us, there were no dues on account of Income Tax and Wealth Tax which were not deposited on account any dispute. However, the particulars of Service-tax, Sales-tax (VAT), Custom Duty, Excise Duty, Entry tax, Stamp duty and other statutory material dues, which have not been deposited on account of any dispute, are as referred to in the details of Contingent Liabilities in Note No. "35".

x) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred any cash losses during the financial year covered by the audit and in the immediately preceding financial year.

xi) In our opinion and according to the information and explanations given to us, there is no default in repayment of dues to any Financial Institution and Bank during the period under report, as per the terms of the respective loans.

xii) In our opinion and according to the information and explanations given to us, the Company has not granted 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 or a nidhi/ mutual benefit fund/ society, as such the provisions of paragraph 4(xiii) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments, accordingly the provisions of paragraph 4 (xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xv) In our opinion, the Company has not given any guarantees for loans taken by others from banks or financial institutions; as such the provisions of paragraph 4(xv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xvi) The term loans obtained by the Company have been applied for the purposes for which they were obtained.

xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the no funds raised on short- term basis have been used for long-term investment during the period.

xviii) The Company has not made any preferential allotment of shares during the period to parties covered in the register maintained under section 301 of the Companies Act, 1956.

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

xx) The Company has not raised any money during the period by public issue.

xxi) 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 course of our audit.

For S. Vaish & Co., For Mittal Gupta & Co.,

Chartered Accountants Chartered Accountants

FRN 00001C FRN 01874C

(S.P. Agrawal) (B. L. Gupta )

Partner Partner

Membership No. 07269 Membership No. 073794

Place : Kanpur Dated : 25th July, 2013


Mar 31, 2012

We have audited the attached Balance Sheet of Dhampur Sugar Mills Limited (the Company), as at 31st March, 2012 the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto and signed by us, this day 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.

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 the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

1. As required by the Companies (Auditor''s Report) Order, 2003, 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.

2. Further to our comments in para 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, the 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 and Loss Account and Cash Flow Statement dealt with by this report comply with the requirements of the Accounting Standards referred to in section 211(3C) of the Companies Act, 1956;

e) On the basis of written representation received from the directors as on 31st 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 director under 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 aforesaid Balance Sheet, the Profit and Loss Account and the Cash Flow Statement together with notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India :

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

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

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

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

(b) The fixed assets have been physically verified by the management at the end of the period. In our opinion the frequency of verification is reasonable considering the size of the Company and nature of its business.

(c) The Company has not disposed off a substantial part of its fixed assets during the period and the going concern status of the Company is not affected.

ii) (a) The inventories, except stores, have been physically verified during the period by the management. In our opinion, the frequency of verification of inventory, except stores, is reasonable.

(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 inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to book records.

iii) (a) The Company had granted interest free unsecured loans/advances to two companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 24.32 crore.

- The year end balance due is Rs. 22.53 crore.

(b) In our opinion, the other terms and conditions on which interest free unsecured loans/advances have been granted to a company listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(c) The payments of principal amount are regular, wherever stipulated.

(d) There is no overdue amount of loans/advances, more than rupee one lac, granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company had taken interest free unsecured loans/advances from four companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 3.17 crore.

- The year end balance due is Rs. 0.65 crore.

(f) In our opinion, the other terms and conditions on which loans/advances have been taken from companies listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) The payments of principal amount are regular, wherever stipulated.

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

v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contract or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered into the register maintained under section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements exceeding the value of rupees five lac in respect of each party during the period have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A and section 58AA of the Companies Act, 1956 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 public. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii) We have broadly reviewed the cost accounting records maintained by the company pursuant to Companies (Cost Accounting Records) Rules 2011 prescribed by Central Government under section 209 (1) (d) of Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of cost records with a view to determine whether they are accurate or complete.

ix) (a) As explained to us, the statutory dues payable by the Company comprises mainly of Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax (VAT), Wealth- tax, Service-tax, Custom Duty, Excise Duty, Cess, Entry tax, Purchase tax and other material statutory dues applicable to it. According to the records of the Company and information and explanations given to us, the Company has been generally regularly depositing the aforesaid undisputed statutory dues with the appropriate authorities. There are no undisputed statutory dues as referred to above as at 31st March,2012 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us, there were no dues on account of Income Tax and Wealth Tax which were not deposited on account any dispute. However, the particulars of Service-tax, Sales-tax (VAT), Custom Duty, Excise Duty, Entry tax, Stamp duty and other statutory material dues, which have not been deposited on account of any dispute, are as referred to in the details of Contingent Liabilities in Note No. "35".

x) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred any cash losses during the financial year covered by the audit and in the immediately preceding financial year.

xi) In our opinion and according to the information and explanations given to us, there is no default in repayment of dues to any Financial Institution and Bank during the period under report, as per the terms of the respective loans.

xii) In our opinion and according to the information and explanations given to us, the Company has not granted 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 or a nidhi / mutual benefit fund/ society, as such the provisions of paragraph 4(xiii) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments, accordingly the provisions of paragraph 4 (xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xv) In our opinion, the Company has not given any guarantees for loans taken by others from banks or financial institutions; as such the provisions of paragraph 4(xv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xvi) The term loans obtained by the Company have been applied for the purposes for which they were obtained.

xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the no funds raised on short- term basis have been used for long-term investment during the period.

xviii)The Company has not made any preferential allotment of shares during the period to parties covered in the register maintained under section 301 of the Companies Act, 1956.

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

xx) The Company has not raised any money during the period by public issue.

xxi) 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 course of our audit.

For S. Vaish & Co., For Mittal Gupta & Co.,

(S.P. Agrawal) (B. L. Gupta)

Partner Partner

Chartered Accountants Chartered Accountants

Membership No. 07269 Membership No. 073794

FRN 00001C FRN 01874C

Place : Kanpur

Dated : 15th May, 2012


Mar 31, 2011

We have audited the attached Balance Sheet of Dhampur Sugar Mills Limited (the Company), as at 31 st March,2011, the Profit and Loss Account and also the Cash Flow Statement for the 18 months ended on that date annexed thereto and signed by us, this day under reference to this report. 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.

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 the 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, 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.

2. Further to our comments in para 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, the 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 and Loss Account and Cash Flow Statement dealt with by this report comply with the requirements of the Accounting Standards referred to in section 211 (3C) of the Companies Act, 1956;

e) On the basis of written representation received from the directors as on 31st March,2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31.03.2011 from being appointed as director under Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) Attention is drawn to note III-2 of schedule 15 relating to accounting for cane purchase liability for the sugar season 2007-08 at Rs. 110 per quintal instead of State Advised Price of Rs. 125 per quintal fixed by the Uttar Pradesh State Government as the legal proceedings are pending in the matter.

g) In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Balance Sheet, the Profit and Loss Account and the Cash Flow Statement together with notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with 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, 2011;

ii) in the case of Profit and Loss Account of the Profit for the 18 months ended on that date; and

iii) in the case of Cash Flow Statement, of the cash flows for the 18 months ended on that date.

Annexure to the Auditors Report The Annexure referred to in the Auditors report to the members of Dhampur Sugar Mills Limited (the Company) for the 18 months ended 31st March, 2011:

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

(b) The fixed assets have been physically verified by the management at the end of the period. In our opinion the frequency of verification is reasonable considering the size of the Company and nature of its business.

(c) The Company has not disposed off a substantial part of its fixed assets during the period and the going concern status of the Company is not affected.

ii) (a) The inventory except stores, has been physically verified during the period by the management. In our opinion, the frequency of verification of inventory, except stores is reasonable.

(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 is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii) (a) The Company had granted interest free unsecured loans/advances to three companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 26.56 crore.

-The year end balance due is Rs. 24.37 crore.

(b) In our opinion, the other terms and conditions on which interest free unsecured loans/advances have been granted to a company listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(c) The payments of principal amount are regular, wherever stipulated.

(d) There is no overdue amount of loans/advances, more than rupee one lac, granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company had taken interest free unsecured loans/advances from four companies covered in the register maintained under section 301 of the Companies Act, 1956.

- The maximum amount involved during the period is Rs. 7.60 crore.

-The year end balance due is Rs. 0.36 crore.

(f) In our opinion, the other terms and conditions on which loans/advances have been taken from companies listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(g) The payments of principal amount are regular, wherever stipulated.

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

v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contract or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered into the register maintained under section 301 of the Companies Act, 1956.

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

vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A and section 58AA of the Companies Act, 1956 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 public. As informed to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii) We have been informed that the cost records as have been prescribed under section 209 (1)(d) of the Companies Act, 1956 have been made and maintained.

ix) (a) As explained to us, the statutory dues payable by the Company comprises mainly of Provident Fund, Investor Education Protection Fund, Employees State Insurance, Income-tax, Sales-tax (VAT), Wealth-tax, Service-tax, Custom Duty, Excise Duty, Cess, Entry tax, Purchase tax and other material statutory dues applicable to it. According to the records of the Company and information and explanations given to us, the Company has been generally regularly depositing the aforesaid undisputed statutory dues with the appropriate authorities. There are no undisputed statutory dues as referred to above as at 31st March,2011 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us, there were no dues on account of Income Tax and Wealth Tax which were not deposited on account of any dispute. However, the particulars of Service-tax, Sales-tax, Custom Duty, Excise Duty, Entry tax. Stamp duty and other statutory material dues, which have not been deposited on account of any dispute, are as referred to in the Details of Contingent Liabilities in Schedule "15".

x) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred any cash losses during the financial year covered by the audit and in the immediately preceding financial year.

xi) In our opinion and according to the information and explanations given to us, there is no default in repayment of dues to any Financial Institution and Bank during the period under report, as per the terms of the respective loans.

xii) In our opinion and according to the information and explanations given to us, the Company has not granted 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 or a nidhi/ mutual benefit fund/ society, as such the provisions of paragraph 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments, accordingly the provisions of paragraph 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

xv) In our opinion, the Company has not given any guarantees for loans taken by others from banks or financial institutions, as such the provisions of paragraph 4(xv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

xvi) The term loans obtained by the Company have been applied for the purposes for which they were obtained.

xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the no funds raised on short- term basis have been used for long-term investment during the period.

xviii)The Company has not made any preferential allotment of shares during the period to parties covered in the register maintained under section 301 of the Companies Act, 1956.

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

xx) The Company has not raised any money during the period by public issue.

xxi) 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 course of our audit.



For S. Vaish & Co., For Mittal Gupta & Co.,

(S.P. Agrawal) (B. L Gupta) Partner Partner Chartered Accountants Chartered Accountants Membership No. 07269 Membership No. 073794 FRN 00001C FRN01874C

Place : Kanpur Dated : 24th May, 2011

 
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