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Auditor Report of Dhanada Corporation Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of DHANADA CORPORATION LIMITED (The Company), which comprises the Balance Sheet as at 31st March 2015, 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 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 fows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from the material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

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

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

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

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

Opinion

Without qualifying our report, we draw your attention to Note 26 B (1). As per clause no. 4.4.6 of the Scheme of Arrangement and Amalgamation sanctioned by Hon'ble Bombay High Court ("Court"), vide their judgment dated 16th July 2009, the allotment of shares against purchase of land shall be done after the conveyance deeds are executed and registered. However the management has issued 17,96,254 equity shares having face value of Re.1 along-with premium of Rs, 5.94 per share to Dr. Laxman V. Kulkarni without executing and registering the conveyance deed. The outcome of the said event is uncertain and we are unable to comment upon it.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with 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.

i. in the case of the Balance Sheet, of the State of affairs of the Company as at 31st March 2015; and ii. in the case of Statement of Profit and Loss, of the Loss 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, 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 Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) There are no observations and comments on financial transactions or other matter which have adverse effects on the functioning of the Company.

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) There are no qualifications preservations or adverse remarks relating to maintenance of accounts or other matters connected therewith.

h) 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 26 B - 17 to the financial statement.

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

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure to the Independent Auditor's Report

With reference to paragraph 1 of report on other legal and other regulatory requirements of our report to the shareholders of Dhanada Corporation Ltd. of even date.

i. Fixed Assets

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

b) Most of the fixed assets have been physically verified by the management during the year and as examined by us, no material discrepancies have been noticed on such verification.

ii. Inventories

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

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

c) In our opinion and according to the information and explanations given to us, the Company has maintained adequate records of its inventories and no material discrepancies were noticed on physical verification.

iii. Loans granted by the Company

The Company has granted loans to parties covered in the register maintained under Section 189 of the Companies Act, 2013. The details are as below:

The interest has been provided on prorate basis and all the principal together with the interest has been converted into fully paid equity shares of respective companies.

iv. Internal Control Systems

In our opinion and according to the information and explanation given to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for purchases of stores, raw materials including components, plant and machinery, equipment and other assets and for sale of goods and services. During the course of our audit we have not observed any weaknesses or continue in the failure to correct major weaknesses in internal control system.

v. Deposits from the public

According to the information and explanations given to us the Company has not accepted deposits from the public during the year and hence the directives issued by the Reserve Bank India and the provisions of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under are not applicable to it.

vi. Cost Records

According to the information and explanations given to us the Central Government has not prescribed maintenance of cost record under sub-section 1 of section 148 under Companies Act, 2013 read with the rule 3 of the Companies (Cost Record and Audit Rules 2014).

vii. Statutory Dues

a. The Company has been regular in depositing undisputed statutory dues in respect of Provident Fund, Employee's State Insurance (ESI), Income Tax, Value Added Tax, Service Tax, Luxury Tax and other material statutory dues with appropriate authorities.

According to the information and explanation given to us no undisputed amounts payable in respect of statutory due were in arrears as at 31st March 2015, for a period of more than six month from the date they became payable except in case of Sales Tax Deferral liability of Rs, 21,04,188/-, which is not paid. Appropriate interest is also due till the actual date of payment.

b Sales Tax Cases

1. The Company has disputed Sales tax liability against Assessment orders passed by Sales Tax Officer, Aurangabad and matter is pending as detailed below:

Nature of Name of the Statute Dues Amount Period Forum Where dispute is pending

Dy. Commissioner of Sales Bombay Sales Tax Act, 1959 Sales Tax 5,000 1998-1999 Tax,(Appeal) Aurangabad

Dy. Commissioner of Sales Bombay Sales Tax Act, 1959 Sales Tax 57,536 1999-2000 Tax,(Appeal) Aurangabad

Dy. Commissioner of Sales Bombay Sales Tax Act, 1959 Sales Tax 88,239 2000-2001 Tax,(Appeal) Aurangabad

2. The Company has disputed Sales tax liability against Rectification Orders passed by Sales Tax officer, Aurangabad and matter is pending as detailed below:

Nature of Part Payment Name of the Dues Amount MADE Statute

Bombay Sales Tax Act, 1959 Sales Tax 2,542,314 150,000

Bombay Sales Tax Act, 1959 Sales Tax 1,779,156 125,000

Bombay Sales Tax Act,1959 Sales Tax 919,859 100,000

Bombay Sales Tax Act,1959 Sales Tax 14,049 2,000



Name of the Statute Period Forum Where dispute is pending

Bombay Sales Tax Act, 1959 1998-1999 Dy. Commis sioner of Sales Tax, (Appeal) Aurangabad

Bombay Sales Tax Act, 1959 Dy. Commissioner of Sales Tax, 1999-2000 (Appeal) Aurangabad

Bombay Sales Tax Act, 1959 Dy. Commissioner of Sales Tax, 2000-2001 (Appeal) Aurangabad

Bombay Sales Tax Act, 1959 Dy. Commissioner of Sales 2001-2002 (Appeal) Aurangabad

3. Sales Tax Refund Cases:

Name of the Nature of Amount Payment Period Forum Where Statute Dues Against dispute is Demand pending

Maharashtra VAT Refund 1,60,494 2,02,023 2007-08 Value Dy. Commis- sioner of Sales Added Tax, 2002 Tax,(Appeal) Aurangabad

Maharashtra VAT Refund 19,22,195 nil 2008-09 Dy. Commis- value sioner of Sales

Added Tax, Tax,(Appeal) 2002 Aurangabad

4. Income Tax Cases:

Name of the Nature of Amount Part Payment F.Y. Forum Statute made where dispute is pending Income Tax Act, 1961 Commissioner of Income Tax Assessment dues 1,96,01,345 Nil 2012-13 (Appeals) - Aurangabad

c. According to the information and explanation given to us, there are no amounts required to transfer to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under.

viii. Accumulated Losses

The Company has accumulated losses at the end of the financial year less than 50% of its net worth and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

ix. Dues to financial Institutions

In our opinion and according to the information and explanations given to us, the Company has defaulted in repayment of dues to banks to the extent of Rs, 1,01,26,914/- (Including interest) of Bank of Maharashtra and Rs, 6,92,11,882/- of Phoenix ARC Pvt. Ltd.

x. Guarantees given by the Company

According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutes. The question of terms and conditions does not arise.

xi. Term Loan

In our opinion and according to the information and explanations given to us, and on an overall examination, the term loans taken have been applied for the purpose for which it was raised.

xii. Frauds

In our opinion and according to the information and explanation given to us, having regards to the nature of the Company's business no fraud on or by the Company was noticed or reported during the year.

For G. K. Chandavarkar & Co.

Chartered Accountants

(Firm Registration No.115924W)



Place : Pune G. K. Chandavarkar

Date : 30th May 2015 (Proprietor)

M. No. 044537


Mar 31, 2014

We have audited the accompanying financial statements of DHANADA CORPORATION LIMITED, Pune, which comprise the Balance Sheet as at 31st March 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("The Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation & presentation of the financial statements that give a true & 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 auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

Report on the Other Legal and Regulatory Requirements

As required by The Companies (Auditor''s Report) Order, 2003 and amended by the Companies (Auditors Report) (Amendment) Order, 2004 dated 25/11/2004 issued by the Department of Company Affairs, Government of India, 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, on the basis of such checks as we considered appropriate and according to the information and explanations given to us.

Further to our comments in the Annexure referred to above, we report that:

1) We have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit.

2) In our opinion, proper books of accounts, as required by law, have been kept by the Company, so far as appears from the examination of the books.

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

4) In our opinion, the Statement of Profit and Loss, the Balance Sheet and Cash Flow Statement complies with the accounting standards referred to in Sub Section 3(c) of Section 211 of The Companies Act, 1956 read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 to the extent applicable.

5) On the basis of the written representations received from the directors on 31st March, 2014 and taken on record by the Board of Directors, we report that none of the directors is disqualified as at 31st March, 2014 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 of The Companies Act, 1956.

Opinion

Without qualifying our report, we draw your attention to Note 27 B (1). As per clause no. 4.4.6 of the Scheme of Arrangement and Amalgamation sanctioned by Hon''ble Bombay High Court ("Court"), vide their judgment dated 16th July 2009, the allotment of shares against purchase of land shall be done after the conveyance deeds are executed and registered. However the management has issued 17,96,254 equity shares having face value of Rs. 1/- along-with premium of Rs. 5.94 per share to Dr. Laxman V. Kulkarni without executing and registering the conveyance deed. The outcome of the said event is uncertain and we are unable to comment upon it.

In our opinion and to the best of our information and according to the explanation given to us, the said accounts subject to and read with notes appearing thereon, give the information required by The Companies Act, 1956, in the manner so required and a true and fair view,

(A) In the case of the Balance Sheet, of the State of Affairs of the Company as at 31st March, 2014.

(B) In the case of Statement of Profit and Loss, of the profit for the year ended on that date.

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

ANNEXURE TO THE AUDITORS'' REPORT

With reference to paragraph 1 of report on the other legal and regulatory requirements of our report to the shareholders of Dhanada Corporation Ltd. of even date.

i. Fixed Assets

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

b. Most of the fixed assets have been physically verified by the management during the year and as examined by us, no material discrepancies have been noticed on such verification.

c. In our opinion, and according to the information and explanations given to us, none of the fixed assets have been revalued during the year under report.

d. The fixed assets disposed off during the year, in our opinion, do not constitute substantial part of that fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

ii. Inventories

a. As explained to us, the inventories were physically verified during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, the Procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanations given to us, the Company has maintained adequate records of its inventories and no material discrepancies were noticed on physical verification.

iii. Loans given/taken by the Company

a. The Company has granted loans to parties covered in the register maintained under Section 301 of the Companies Act, 1956. The details are as below:

Particulars Maximum amount due Balance due as at the end of at any time year Financial year Amount the during the Amount (Rs.)

Dhanada 1,58,86,166 1,46,13,600 Engineering Pvt. Ltd.

Dhanada 81,69,311 81,69,311 Education Pvt. Ltd.

Dhanada Clean 8,29,444 8,29,444 Energy (India) Pvt. Ltd.

b. The Company has taken interest free unsecured loans from the parties covered in the register maintained u/s 301 of the Companies Act, 1956. The details of which are as below:

Particulars Maximum amount due at any time Balance due as at the during the year Amount (Rs.) end of the Financial year Amount (Rs.)

Dhanada Holdings Pvt. Ltd. 1,68,78,039 1,26,90,769

c. The terms and conditions for such loans are not prima facie prejudicial to the interest of the Company.

iv. Internal Control Systems

In our opinion and according to the information and explanation given to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for purchases of stores, raw materials including components, plant and machinery, equipment and other assets and for sale of goods.

v. Transactions with related parties as per Register of Contract u/s 301

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

b. According to information and explanation given to us there are no transactions of purchases of goods and material and sale of goods, materials and services made in pursuance of contracts or arrangements entered in the register maintained under section 301of the Companies Act, 1956 and aggregating during the year to Rs. 5,00,000/- or more in respect of each party.

vi. Deposits from the public

The Company has not accepted deposits from the public during the year and hence the question of complying with the provision of section 58A & 58AA of the Companies Act, 1956 and the rules framed there under does not arise.

vii. Internal Audit System

The Company has appointed M/s. Khandelwal Jain & Co., Chartered Accountants, Aurangabad as the internal auditors'' and their scope and duties ensure reasonable internal checking of its financial and other records.

viii. Cost Records

According to the Circular No. 67/2011 dated 30th November 2011 issued by the Government of India, Ministry of Corporate Affairs, the Companies (Cost Accounting Records) Rules 2011 are not applicable to the Company.

ix. Statutory Dues

a. The Company has been regular in depositing undisputed statutory dues in respect of Provident Fund, Employee''s State Insurance (ESI), Income Tax, Value Added Tax, Service Tax, Luxury Tax and other material statutory dues except as detailed below:-

Particulars where arrears are above Six Months at Balance Sheet Date or anytime during the period under audit:

Name of the Statue Nature of Amount Period Dues '' RS which the Due Related

MVAT Act, 2002 VAT 164440 2009-10

MVAT Act, 2002 VAT 660403 2009-10

MVAT Act, 2002 VAT 805182 2009-10

MVAT Act, 2002 VAT 8462 2012-13

MVAT Act, 2002 VAT 286275 2012-13

MVAT Act, 2002 VAT 80662 2012-13

MVAT Act, 2002 VAT 284381 2012-13

MVAT Act, 2002 VAT 329042 2012-13

MVAT Act, 2002 VAT 342261 2012-13

MVAT Act, 2002 VAT 307122 2012-13

MVAT Act, 2002 VAT 338097 2012-13

MVAT Act, 2002 VAT 262533 2012-13

MVAT Act, 2002 VAT 209397 2013-14

MVAT Act, 2002 VAT 233196 2013-14

MVAT Act, 2002 VAT 195184 2013-14

The Maharashtra Tax on Luxury Tax 421576 2011-12 Luxuries Act, 1987

The Maharashtra Luxury Tax 156405 2012-13 Tax on Luxuries Act, 1987

The Maharashtra Tax Luxury Tax 427495 2012-13 on Luxuries Act, 1987

The Maharashtra Tax on Luxury Tax 408270 2013-14 Luxuries Act, 1987

Service Tax Act, 1994 Service Tax 440624 2012-13

Service Tax Act, 1994 Service Tax 450568 2012-13 Service Tax Act, 1994 Service Tax 388551 2012-13

Service Tax Act, 1994 Service Tax 136556 2012-13

Service Tax Act, 1994 Service Tax 391524 2012-13

Service Tax Act, 1994 Service Tax 617567 2012-13

Service Tax Act, 1994 Service Tax 392128 2012-13

Service Tax Act, 1994 Service Tax 515726 2012-13

Service Tax Act, 1994 Service Tax 154841 2012-13

Service Tax Act, 1994 Service Tax 454648 2013-14

Service Tax Act, 1994 Service Tax 395232 2013-14

Service Tax Act, 1994 Service Tax 245444 2013-14

Name of the Statue Due Date Payments Date Made Payment

MVAT Act, 2002 21/10/2009 164440 26/09/2013

MVAT Act, 2002 21/01/2010 660440 26/09/2013

MVAT Act, 2002 21/04/2010 805182 Multiple

MVAT Act, 2002 21/06/2012 8462 21/06/2013

MVAT Act, 2002 21/07/2012 286275 21/06/2013

MVAT Act, 2002 21/09/2012 80662 21/06/2013

MVAT Act, 2002 21/10/2012 284381 21/06/2013

MVAT Act, 2002 21/11/2012 329042 21/06/2013

MVAT Act, 2002 21/12/2012 342261 21/06/2013

MVAT Act, 2002 21/02/2013 307122 Multiple

MVAT Act, 2002 21/03/2013 338097 08/01/2014

MVAT Act, 2002 21/04/2013 262533 Multiple

MVAT Act, 2002 21/05/2013 194874 08/01/2014

MVAT Act, 2002 21/06/2013 217615 11/01/2014

MVAT Act, 2002 21/07/2013 195184 Multiple

The Maharashtra Tax on 21/04/2012 421576 10/01/2014 Luxuries Act, 1987

The Maharashtra 21/03/2013 156405 10/01/2014 Tax on Luxuries Act, 1987

The Maharashtra Tax 21/04/2013 427495 17/01/2014 on Luxuries Act, 1987

The Maharashtra Tax on 21/05/2013 405270 17/12/2013 Luxuries Act, 1987

Service Tax Act, 1994 05/08/2012 440624 05/09/2013

Service Tax Act, 1994 05/09/2012 450568 10/09/2013 Service Tax Act, 1994 05/10/2012 388551 07/10/2013

Service Tax Act, 1994 05/11/2012 136556 09/11/2013

Service Tax Act, 1994 05/12/2012 391524 09/11/2013

Service Tax Act, 1994 05/01/201 391567 16/12/2013

Service Tax Act, 1994 05/02/2013 617567 04/12/2013

Service Tax Act, 1994 05/03/2013 392128 16/12/2013

Service Tax Act, 1994 31/03/2013 515726 04/12/2013

Service Tax Act, 1994 05/05/2013 454648 30&31/12/2013

Service Tax Act, 1994 05/06/2013 395232 Multiple

Service Tax Act, 1994 05/07/2013 245444 20/01/2013



b. The Undisputed Sales Tax Deferral liability is Rs. 21,04,188/-, which is not paid. Appropriate interest is also due till the actual date of payment.

c. Sales Tax Cases:

1. The Company has disputed Sales tax liability against Assessment orders passed by Sales Tax officer, Aurangabad and matter is pending as detailed below:

Name of the Nature of Amount Period Forum Where dispute Statute Dues is pending

Bombay Sales Sales Tax 5,000 1998-1999 Dy. Commissioner of Tax Act, 1959 Sales Tax,(Appeal) Aurangabad

Bombay Sales Tax Sales Tax 57,536 1999-2000 Dy. Commissioner of Act, 1959 Sales Tax,(Appeal) Aurangabad Bombay Sales Tax Sales Tax 88,239 2000-2001 Dy. Commissioner of Act, 1959 Sales Tax,(Appeal) Aurangabad

Maharashtra Value MVAT 2,02,023 2007-08 Dy. Commissioner of Added Tax, 2002 Sales Tax,(Appeal) Aurangabad

2. The Company has disputed Sales tax liability against Rectification Orders passed by Sales Tax officer, Aurangabad and matter is pending as detailed below:

Name of the Nature of Amount Part Pay- Period Statute Dues ment made

Bombay Sales Sales Tax 2,542,314 150,000 1998-1999 Tax Act, 1959

Bombay Sales Sales Tax 1,779,156 125,000 1999-2000 Tax Act, 1959

Bombay Sales Sales Tax 919,859 100,000 2000-2001 Tax Act, 1959

Bombay Sales Sales Tax 14,049 2,000 2001-2002 Tax Act, 1959

Name of the Forum Where dispute is pending Statute

Bombay Sales Dy.Commissioner of Sales Tax, (Appeal) Aurangabad Tax Act, 1959

Bombay Sales Dy.Commissioner of Sales Tax, (Appeal) Aurangabad Tax Act, 1959

Bombay Sales Dy.Commissioner of Sales Tax, (Appeal) Aurangabad Tax Act, 1959

Bombay Sales Dy.Commissioner of Sales Tax,(Appeal) Aurangabad Tax Act, 1959

x. Sick Industry

The accumulated losses of the Company are not more than fifty per cent of its net worth at the end of the financial year.

xi. Accumulated Losses

The Company has accumulated losses as on 31st March 2014 as well as on 31st March 2013. Further the Company has not incurred cash losses during the financial year covered by our audit and also in the immediately preceding financial year.

xii. Dues to financial Institutions

In our opinion and according to the information and explanations given to us, the Company has defaulted in repayment of dues to banks to the extent of Rs. 1,31,829/- (Including interest) of Bank of Maharahstra and Rs. 5,94,72,218/-/- of The Saraswat Co. Op. Bank Ltd. as on 31st March 2014. The Saraswat Co-Op. Bank has assigned and transferred this term loan to Phoenix ARC Pvt. Ltd. together with all underlying securities as per the agreement dated 9th April 2014 and such confirmation letter dated 30th April 2014 received by the Company.

xiii. Secured Loans and advances granted

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

xiv. Chit Fund, Nidhi or Mutual Benefit Company

In our opinion, the Company is not a chit fund or nidhi or mutual benefit fund or society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order 2003, (as amended), are not applicable to the Company.

xv. Investments

In our opinion and according to the information and explanation given to us the company has not done any transaction during the year of trading in Shares, Securities, debentures and other investments.

xvi. Guarantees given by the Company

According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutes. The question of terms and conditions does not arise.

xvii. Term Loan

In our opinion and according to the information and explanations given to us, and on an overall examination, the term loans taken have been applied for the purpose for which it was raised.

xviii. Sources of funds and its application

According to the cash flow statement and other records examined by us and the information and explanations given to us, on an overall basis, funds raised on short term basis have, prima facie, not been used during the year for long term investment (fixed assets etc.) and vice versa, other than temporary deployment pending application.

xix. Preferential Issue

The Company has not made any preferential allotment of equity shares during the year 2013-14.

xx. Securities and Debentures

In our opinion and according to the information and explanations given to us, the Company has not issued any secured debentures during the period covered by our audit. Accordingly the provisions of clause 4(xix) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xxi. End use of Public Issue Fund

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

xxii. Frauds

In our opinion and according to the information and explanation given to us, having regards to the nature of the Company''s business no fraud on or by the Company was noticed or reported during the year.

For G. K. Chandavarkar & Co. Chartered Accountants (Firm Registration No.115924W)

Place: Pune G. K. Chandavarkar Date : 30th May 2014 (Proprietor) M. No. 044537


Mar 31, 2013

We have audited the accompanying fnancial statements of DHANADA CORPORATION LIMITED, Pune, which comprise the Balance Sheet as at 31st March 2013, the Statement of Proft and Loss and the Cash Flow Statement for the year then ended, and a summary of the signifcant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these fnancial statements that give a true and fair view of the fnancial position, fnancial performance and cash fows 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 fnancial 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 fnancial 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 fnancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fnancial statements. An audit also includes assessing the accounting principles used and signifcant estimates made by management, as well as evaluating the overall fnancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

Report on the Other Legal and Regulatory Requirements

As required by The Companies (Auditor''s Report) Order, 2003 and amended by the Companies (Auditors Report) (Amendment) Order, 2004 dated 25/11/2004 issued by the Department of Company Affairs, Government of India, in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specifed in paragraphs 4 and 5 of the said Order, on the basis of such checks as we considered appropriate and according to the information and explanations given to us.

Further to our comments in the Annexure referred to above, we report that:

(1) We have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit.

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

(3) The Balance Sheet, the Statement of Proft and Loss, and Cash Flow Statement dealt with by the report are in agreement with the books of account.

(4) In our opinion, the Statement of Proft and Loss, the Balance Sheet and Cash Flow Statement complies with the accounting standards referred to in Sub Section 3(c) of Section 211 of The Companies Act, 1956 to the extent applicable.

(5) On the basis of the written representations received from the directors on 31st March, 2013 and taken on record by the Board of Directors, we report that none of the directors is disqualifed as at 31st March, 2013 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 of The Companies Act, 1956.

Opinion

Without qualifying our report, we draw your attention to Note 27 B (1). As per clause no. 4.4.6 of the Scheme of Arrangement and Amalgamation sanctioned by Hon''ble Bombay High Court ("Court"), vide their judgment dated 16th July 2009, the allotment of shares against purchase of land shall be done after the conveyance deeds are executed and registered. However the management has issued 17,96,254 equity shares having face value of Re.1 along-with premium of Rs. 5.94 per share to Dr. Laxman V. Kulkarni without executing and registering the conveyance deed. The outcome of the said event is uncertain and we are unable to comment upon it.

In our opinion and to the best of our information and according to the explanation given to us, the said accounts subject to and read with notes appearing thereon, give the information required by The Companies Act,1956, in the manner so required and a true and fair view,

(A) In the case of the Balance Sheet, of the State of Affairs of the Company as at 31st March, 2013.

(B) In the case of Statement of Proft and Loss, of the proft for the year ended on that date.

(C) In the case of the Cash Flow Statement, of the cash fows of the Company for the year ended on that date.

ANNEXURE TO THE AUDITORS'' REPORT

With reference to paragraph 1 of report on other legal and other regulatory requirements of our report to the shareholders of Dhanada Corporation Ltd. of even date.

i. Fixed Assets

a. The Company has generally maintained proper records showing full particulars including quantitative details and situation of the fxed assets.

b. Most of the fxed assets have been physically verifed by the management during the year and as examined by us, no material discrepancies have been noticed on such verifcation.

c. In our opinion, and according to the information and explanations given to us, none of the fxed assets have been revalued during the year under report.

d. The fxed assets disposed off during the year, in our opinion, do not constitute substantial part of that fxed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

ii. Inventories

a. As explained to us, the inventories were physically verifed during the year by the management at reasonable intervals.

b. In our opinion and according to the information and explanations given to us, the Procedures of physical verifcation of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanations given to us, the Company has maintained adequate records of its inventories and no material discrepancies were noticed on physical verifcation.

iii. Loans given/taken by the Company

a. The Company has granted loans to parties covered in the register maintained under Section 301 of the Companies Act, 1956. The details are as below:

Maximum amount due at any time Balance due as at the end of the Particulars during the year Amount (Rs.) Financial year Amount (Rs.)

Dhanada Engineering Pvt. Ltd. 1,57,30,166 1,57,30,166

Dhanada Education Pvt. Ltd. 61,18,868 61,18,868

b. The Company has taken interest free unsecured loans from the parties covered in the register maintained u/s 301 of the Companies Act, 1956. The details of which are as below:

Particulars Maximum amount due at any time Balance due as at the end of the during the year Amount (Rs.) Financial year Amount (Rs.)

Dhanada Holdings Pvt. Ltd. 8,35,46,760 1,30,14,823

c. The terms and conditions for such loans are not prima facie prejudicial to the interest of the Company.

iv. Internal Control Systems

In our opinion and according to the information and explanation given to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for purchases of stores, raw materials including components, plant and machinery, equipment and other assets and for sale of goods.

v. Transactions with related parties as per Register of Contract u/s 301

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

b. According to information and explanation given to us there are no transactions of purchases of goods and material and sale of goods, materials and services made in pursuance of contracts or arrangements entered in the register maintained under section 301of the Companies Act, 1956 and aggregating during the year to Rs. 5,00,000/- or more in respect of each party.

vi. Deposits from the public

The Company has not accepted deposits from the public during the year and hence the question of complying with the provision of section 58A & 58AA of the Companies Act, 1956 and the rules framed there under does not arise.

vii. Internal Audit System

The Company has appointed M/s. Khandelwal Jain & Co., Chartered Accountants, Aurangabad as the internal auditors'' and their scope and duties ensure reasonable internal checking of its fnancial and other records.

viii. Cost Records

According to the Circular No. 67/2011 dated 30th November 2011 issued by the Government of India, Ministry of Corporate Affairs, the Companies (Cost Accounting Records) Rules 2011 are not applicable to the Company.

ix. Statutory Dues

a. The Company has been regular in depositing undisputed statutory dues in respect of Provident Fund, Employee''s State Insurance (ESI), Income Tax, Value Added Tax, Service Tax, Luxury Tax and other material statutory dues except as detailed below:-

b The Undisputed Sales Tax Deferral liability is Rs. 21,04,188/-, which is not paid. Appropriate interest is also due till the actual date of payment.

x. Sick Industry

The accumulated losses of the Company are not more than ffty per cent of its net worth at the end of the fnancial year.

xi. Accumulated Losses

The Company does not have any accumulated losses at the end of the fnancial year and has not incurred cash losses in the current fnancial year and in the immediately preceding fnancial year.

xii. Dues to fnancial Institutions

In our opinion and according to the information and explanations given to us, the Company has defaulted in repayment of dues to banks to the extent of Rs. 3,493,290/- of The Saraswat Co. Op. Bank Ltd. as on 31st March 2013.

xiii. Secured Loans and advances granted

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

xiv. Chit Fund, Nidhi or Mutual Beneft Company

In our opinion, the Company is not a chit fund or nidhi or mutual beneft fund or society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order 2003, (as amended), are not applicable to the Company.

xv. Investments

The Company has maintained proper records of transactions and contracts in respect of dealing or trading in Shares, Securities, debentures and other investments and timely entries have been made therein.

xvi. Guarantees given by the Company

According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or fnancial institutes. The question of terms and conditions does not arise.

xvii. Term Loan

In our opinion and according to the information and explanations given to us, and on an overall examination, the term loans taken have been applied for the purpose for which it was raised.

xviii. Sources of funds and its application

According to the cash fow statement and other records examined by us and the information and explanations given to us, on an overall basis, funds raised on short term basis have, prima facie, not been used during the year for long term investment (fxed assets etc.) and vice versa, other than temporary deployment pending application.

xix. Preferential Issue

The Company has made preferential allotment of equity shares to Dhanada Holdings Private Limited, on conversion of loan amount taken from it at the price determined as per guidelines issued by SEBI.

xx. Securities and Debentures

In our opinion and according to the information and explanations given to us, the Company has not issued any secured debentures during the period covered by our audit. Accordingly the provisions of clause 4(xix) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xxi. End use of Public Issue Fund

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

xxii. Frauds

In our opinion and according to the information and explanation given to us, having regards to the nature of the Company''s business no fraud on or by the Company was noticed or reported during the year.

For G. K. Chandavarkar & Co.

Chartered Accountants

(Firm Registration No.115924W)

Place: Pune G. K. Chandavarkar

Date : 30th May 2013 (Proprietor)

M. No. 044537


Mar 31, 2000

We have audited the attached balance sheet of Vedant Hotels Ltd. at 31st March 2000 and the relative profit & loss account for the year ended on that date annexed thereto and report that:

1. As required by the manufacturing and other companies (Auditors report order, 1988 issued by the company law Board in terms of section 227 (4A)of the Companies Act, 1956, we enclose in the annexture.a statement on the matters specified in paragraphs 4 & 5 of the said order.

2. Further to our comments in the annexture referred in paragraph 1 above.we state 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 accounts as required by law have been kept by the com- pany, so far as apperars from our examination of the books.

c) In our opinion, the profit and loss account and the balance sheet comply with the accounting standards referred to in sub section 3(C) of Section 211 of the Companies Act 1956.

d) The Balance Sheet and Profit & Loss account, referred to in this report are in aggrement with the books of accounts.

i) The quantitative data and closing stock have been adopted as furnished and certified by the management of the company.

ii) Depreciation is not provided on additions to various asstets and which are not put to use as on 31st March 2000.

iii) Public issue expenses of Rs. 10,79,014/- and miscellaneous Expenditure 13,759/- are grouped under the head deferred revenue expenditure.

iv) Interest on loan account of Janata Sahakari Bank Ltd. is disputed and also not debited by the bank hence, not ascretained and provided in accounts,and loss is shown less to that extent.

v) Confirmation letters from sundry creditors and loans & advances are called for but not received in many cases and figures are subject to adjustments if any.

e) Subject to the foregoing, in our opinion and to the best of the our information and according to the explanations given to us, the said accounts read with the notes there on give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view :

i) In so far as they relate to the Balance Sheet or the statement of affairs of the Company as at 31st March, 2000.

ii) In so far as they relate to the Profit and Loss Accounts, of the company for the year ended on that date.

1. ANNEXTURE TO THE AUDITORS REPORT

A] The company has maintained proper record to show full particulars including quantitavie details and situation of its fixed assets.

B] Fixed assets of the company are physically verified by the management according to a phased programme which we consider reasonable. Persuant to the programme, a physical verification was carried

2. out during the period and this revealed no material discrepancies.

3. The fixed assets of the company have not been revalued during the year.

The stock of finished goods, spare parts and raw material have been physically verified during the year by

4. the management. In our opinion the frqquency of verification is resonable.

The procedure of physical verification of stocks followed by the management are reasonable and ad-

5. equate in relation to the size of company and the nature of its business.

It is explained that no material discrepancies were noticed on verification between the physical stocks and

6. books records.

In Our opinion the valuation of stocks, is fair & proper in the accordance with the normally accepted

7. accounting principles & is on the same basis as in preceding year.

The company has not taken loans from a Company under the same management listed in register main- tained under Setion 301 of the Companies act, 1956 and the terms and conditions for such loans are not

8. prima facie prejudicial to the interest of the company.

The Company has not granted interest free loans to the Companies, firms or other parties listed in the register

9. maintained under Section 301 of the companies Act, 1956.

In our opinion, there is an adequte internal control procedure for components, plant & machinery equip-

10. ments and other assets.

In our opinion and according to the information and explanation given to us, the transactions for purchase of goods and sale of goods, materials and services made in pursuance of contracts or aggrements entered in the register maintained under Section 301, of Companies Act, 1956 and aggregating during the period to Rs. 50,000 or more in respect of each party have been made at price which are reasonable having regard of prevaling market price at which transactions for similar goods, materials or services have been

11. made with other parties.

12. The Company has the system of damaged store.

The Company has not accepted any deposits from the public during the year & hence, the question of complying with the provisions of section 58-A of the Companies Act. 1956 & the rules farmed there under

13. does notarise.

14. The Company did not gererate any realisable scrap during the period and has no by - product.

In our opinion the companys present internal audit system is commersurate with its size and nature of

15. business.

The Central Govt, has not prescribed maintenance of cost records by the Company under Section 209 (I) (d)

16. of the Companies Act, 1956 for any of the companys products.

The Company has paid the contribution of P. F. and ESIC. However there had been delay in payment on

17. these accounts in certain cases.

According to the information and explanations given to us and subject to notes on accounts no undisputed accounts payble in respect of income Tax, Wealth Tax, Sales Tax, Luxry Tax, Custom Duty and Excise Duty were out standing as at 31 st March 2000 for a period of more than Six months from the date they become

18. payble.

According to the information & explanations given to us & the records of the company examined by us, no personal expenses have been charged to revenue account other than those payble under contractual

19. obligations & / or special sanction & /or in accordance with generally accepted business practices.

The Company is not a sick industrial company within the meaning of clause (O) of Section 3 (1) of the sick

20. industrial companies (special provisions) Act, 1985.

The Company has a reasonable system of recording receipts, issues and consumption of materials and stores and such system provides for a reasonable allocation of the materials consumed and man - hours

21. utilised to departments commersurate with the size of the units and the nature of their business.

The Company has a reasonable system of allocating man - hours utilised to the relative jobs, commensurate

22. with its size and nature of its business.

There is a reasonable system of authorisation at proper levels, and an adequqte system of internal control commensurate with the size of the units and the nature of their business, on issue of stores and allocation of stores and labour to departments.

for T. R. JALNAWALA & ASSOCITAES, Chartered Accountants,

PLACE : AURANGABAD T. R. JALNAWALA

DATE : 2nd SEPT. 2000 PROPRIETOR

 
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