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Auditor Report of Dhanuka Agritech Ltd.

Mar 31, 2015

We have given our report dated 28th May, 2015 on standalone financial statements of Dhanuka Agritech Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2015 and the statement of Profit and Loss and the Cash flow statement for the year ended 31st March, 2015 and a summary of significant accounting policies and other explanatory information. We have been informed by the company that the Hon'ble High Court of Delhi (vide order dated 06-11-2015) has approved the scheme of amalgamation of M/s A.M. Bros. Fintrade Pvt Ltd and M/s Dhanuka Finvest Pvt Ltd. with the company. The said scheme has become effective on filing of the order of the Hon'ble High Court of Delhi with the ROC. Since the appointed date for the aforesaid scheme of amalgamation is 01st January, 2015, the company has reworked its financial statements for the year ended 31st March, 2015 after giving effect to the aforesaid scheme of amalgamation and present the same to the members. This report is in substitution of our earlier report dated 28th May, 2015.

Management's Responsibility for the Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

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

An audit involves performing procedures to obtain audit evidence about the amount and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including assessment of the risk of material misstatement of the financial statements, whether due to fraud or error. In making those assessments, the auditor considers internal financial control relevant to the Company's preparation of the standalone 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 and adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the standalone financial statements.

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

Opinion

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

Report on Other Legal and Regulatory Requirements

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

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 purpose of our audit of the standalone financial statements;

(b). In our opinion proper books of account as required by law relating to preparation of the aforesaid standalone financial statements have been kept by the Company so far 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 maintained for the purpose of preparation of standalone financial statements;

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

(e). On the basis of the written representation 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; and

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

(i). The company has disclosed the impact of pending litigations on its financial position in its financial statements. - Refer Note No 2(1) (i) (a) to the financial statements;

(ii) There are no foreseeable losses on long term contracts including derivative contracts. Hence, company has not made any provision, as required under the applicable law or accounting standards.

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

Annexure to the Auditor's Report

As required by the Companies (Auditor's Report) Order 2015, (the Order) issued by the Central Government of India in terms of Section 143 of the Companies Act, 2013, and in terms of information and explanations given to us and also on the basis of such checks as we considered appropriate, we report on the matters specified in paragraphs 3 and 4 of the said order as follows:-

(i). (a) The Company has maintained 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 reasonable intervals and no material discrepancies were noticed on such verification.

(ii). (a) The inventory of the company (including lying with third parties) has been physically verified by the management during the year according to a phased program normally so designed that each material item is physically verified at least once in a year and at more frequent intervals in appropriate cases.

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

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

(iii). (a) The Company during the year has not granted any loan to a company covered in the register maintained under section 189 of the Companies Act 2013 (the Act).

(b) In our opinion, the rate of interest and other terms and conditions of unsecured loans given by the Company are not, prima facie, prejudicial to the interest of the company.

(c) There is no overdue amount of the principal repayable at the year end.

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

(v) In our opinion and according to the information and explanations given to us, during the year the Company has not accepted any new deposits from the public within the purview of Sections 73 to 76 or any other relevant provisions of the Act and rules framed there under.

(vi). We have broadly reviewed the books of account maintained by the company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under Sub section (1) of Section-148 of the said Act, and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate or complete.

(vii). (a) According to the information and explanations given to us and on the basis of our examination of records of the company, amount deducted / accrued in books of accounts in respect of, undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales tax, customs duty, excise duty, cess and other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities.

There are no material outstanding undisputed statutory dues as at the last day of the financial year ended on 31- 03-2015 for a period of more than six months from the date they become payable.

(b) According to the information and explanation given to us, the following dues of Excise Duty and cess, Service Tax and Cess and Income Tax and Cess have not been deposited on account of some dispute with the concerned authority:

(Rs. in lakhs)

Nature of Period to which the Forum where Dues Amount amount relates dispute pending

Income Tax 3.57 AY 2003-04 ITAT, Delhi

Income Tax 48.86 AY 2012-13 CIT(A), Delhi

Service Tax 140.25 Jan-05 to Aug-07 Addl/ Dy. Commissioner

Service Tax 452.47 Apr-07 to Oct-14 Addl/ Dy. Commissioner

Service Tax 36.00 Oct-08 to Mar-09 CESTAT, Delhi

Service Tax 18.86 Apr-11 to Mar-13 Addl/ Dy. Commissioner

Excise Duty 9.41 1996 Addl/ Dy. Commissioner

Excise Duty 48.21 Apr-99 to Mar-00 CESTAT, Delhi

Excise Duty 2.84 Apr-09 to Mar-11 Appeal to be filed with CESTAT.

Excise Duty 14.60 Apr-10 to Mar-11 CESTAT, Delhi

Excise Duty 190.12 Jan-14 to Dec-14 Commissioner

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

(viii) There are no accumulated losses of the Company. The company has neither incurred cash losses during the financial year covered by our audit nor in the immediately preceding financial year.

(ix). According to the information and explanations given to us, the company has not defaulted in the repayment of dues to the Financial Institutions or Banks. Further, there are no debenture holders during the year.

(x) According to the information and explanations given to us, the company has not given any guarantees for loans taken by others from banks orfinancial institutions.

(xi) In our opinion, and according to the information and explanations given to us the company did not have any term loans outstandings during the year.

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

For Dinesh Mehta & Co.

Chartered Accountants

Firm Registration No.:000220-N

Sd/-

Anup Mehta

Place: New Delhi Partner

Date: 02nd December, 2015 Membership No.093133


Mar 31, 2014

We have audited the accompanying financial statements of Dhanuka Agritech Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2014, Statement of Profit and Loss and Cash Flow Statement for the financial year ended 31st March, 2014 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 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 fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of risks material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control . An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

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

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

b) In the case of the 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 for the year ended on that date.

Report on Other Legal and Regulatory Requirements

I As required by the Companies (Auditor''s Report) Order 2003, (the Order) issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and in terms of information and explanations given to us and also on the basis of such checks as we considered appropriate, we report on the matters specified in paragraphs 4 and 5 of the said order as follows:-

1. (a) The Company has maintained 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 reasonable intervals and no material discrepancies were noticed on such verification.

(c) No substantial part of the fixed assets have been disposed off during the year affecting the going concern status of the Company.

2. (a) The inventory of the company (including lying with third parties) has been physically verified by the management during the year according to a phased programmed normally so designed that each material item is physically verified at least once in a year and at more frequent intervals in appropriate cases.

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

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

3. (a) The Company during the year has not granted any loan to a company covered in the register maintained under section 301 of the Act.

(b) In our opinion, the rate of interest and other terms and conditions of unsecured loans given by the Company are not, prima facie, prejudicial to the interest of the company.

(c&d) There is no overdue amount of the principal repayable at the year end.

(e) According to the information and explanations given to us, the unsecured loans taken by the Company from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 is by way of Inter Corporate Deposits received from six companies and deposits from two individuals of Nil outstanding balance as on 31.03.14 (Maximum Rs. 20.33 Crores outstanding during the period).

(f) In our opinion, the rate of interest and other terms and conditions of unsecured loans taken by the Company are not, prima facie, prejudicial to the interest of the company.

(g) There is no overdue amount of the principal repayable at the year end.

4. In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

5 (a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into register maintained under Section 301 of the Act have been made at prices which are generally reasonable considering the strategic relationship and having regard to the prevailing market prices at the relevant time.

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

6. In our opinion and according to the information and explanations given to us, during the year the Company has not accepted any new deposits from the public within the purview of Sections 58A, 58AA or any other relevant provisions of the Act read with the Companies (Acceptance of Deposits) Rules, 1975.

7. As per the information and explanations given to us by the management, the Company has appointed external firm of Chartered Accountants to review internal controls procedures together with the internal checks during the year which can be considered as an internal audit commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of Sub section (1) of Section-209 of the said Act, and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate or complete.

9. (a) According to the records of the company, undisputed

statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income- tax, wealth-tax, service tax, sales tax, customs duty, excise duty, cess and other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities. Since govt. has not notified any rules under Section 441A of the Companies Act, 1956, therefore we are unable to comment on this particular issue.

b) There are no material outstanding undisputed statutory dues as at the last day of the financial year ended on 31-03-2014 for a period of more than six months from the date they become payable.

c) According to the information and explanation given to us, the following dues of Excise Duty and Cess, Service Tax and Cess and Income Tax have not been deposited on account of some dispute with the concerned authority:

Name of Authority where Amount Involved the dispute pending (Rs. in lacs) / Statute Nature of Dues

Central Custom Excise & 9.41 Excise Act, Service Tax Appeal (Year 1996 ) 1944. Tribunal, New (Excise Duty Delhi Related To Fire )

Custom Excise & 48.21 Service Tax Appeal (Year 1999-2000) Tribunal, New ( Excise Duty on Delhi Returned Goods)

Custom Excise & 14.60 Service Tax Appeal (Approx.) Tribunal, New (Year 2009-10) Delhi (Interest, fine & Penalty in case of short payment of Excise Duty)

Service Tax Additional / Deputy 140.25 Act 1994 Commissioner of (2007) Service Tax (Tax on exempted goods for non maintenance of Separate Records)

Additional / Deputy 159.54 Commissioner of (2007-08 to 2011-12) Service Tax (Disallowance of ISD for improper challans)

Additional / Deputy 56.22 Commissioner of (2006-07 to 2008-09) Service Tax (Tax on Reimbursement of Expenses and Job works)

Additional / Deputy 11.46 Commissioner of (2011-2012) Service Tax (Tax on Reimbursement of Expenses)

Income Tax Commissioner 3.57 Act 1961 of Income tax (Year 2002-03) (Appeals) (Addition on account of unexplained loans)

10. There are no accumulated losses of the Company. The company has neither incurred cash losses during the financial year covered by our audit nor in the immediately preceding financial year.

11. According to the information and explanations given to us, the company has not defaulted in the repayment of dues to the Financial Institutions or Banks. Further, there are no debenture holders.

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

13. The company is not a chit fund or a nidhi / mutual benefit fund/ society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 (hereinafter referred to as the said order) are not applicable to the company.

14. The company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the said Order are not applicable to the company.

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

16. In our opinion, and according to the information and explanations given to us on an overall basis, the term loans taken by the company for augmenting long term resources of the company towards general corporate objectives have been applied for the purpose for which they were obtained.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the company in our opinion the funds raised on short-term basis have not been used for long-term investments.

18. The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the question of reporting on whether the price at which such shares have been issued is prejudicial to the interest of the company does not arise.

19. The company has not issued any debentures. Accordingly, the question of creating a security for debentures does not arise.

20. The company has not raised any money by public issues during the year. Accordingly, the question of disclosure of end use of such monies does not arise.

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

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

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub section (3C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on 31st March, 2014, and taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2014, from being appointed as a director in terms of clause (g) of Sub Section (1) of Section 274 of the Companies Act, 1956.

For Dinesh Mehta & Co.

Chartered Accountants Firm Registration No:000220-N

Deepak Malhotra Place: New Delhi Partner Date: 20th May, 2014 Membership No.502386


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Dhanuka Agritech Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2013 and the statement of Profit and Loss and Cash flow statement for the period ended 31st March, 2013 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 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 fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of risks 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:

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 the statement of Profit and Loss, of the profit for the period ended on that date.

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

Report on Other Legal and Regulatory Requirements

I As required by the Companies (Auditor''s Report) Order 2003, (the Order) issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and in terms of information and explanations given to us and also on the basis of such checks as we considered appropriate, we report on the matters specified in paragraphs 4 and 5 of the said order as follows:-

1. (a) The Company has maintained 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 reasonable intervals and no material discrepancies were noticed on such verification.

(c) No substantial part of the fixed assets have been disposed off during the year affecting the going concern status of the Company.

2. (a) The inventory of the Company (including stocks with third parties) has been physically verified by the management during the year according to a phased programmed normally so designed that each material item is physically verified at least once in a year and at more frequent intervals in appropriate cases.

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

3. (a) The Company during the year has not granted any loan to a Company covered in the register maintained under Section 301 of the Act.

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

(c&d) There is no overdue amount of the principal repayable at the year end.

(e) According to the information and explanations given to us, the unsecured loans taken by the Company from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 is by way of Inter Corporate Deposits received from 6 companies and deposits from 4 individuals of NIL outstanding balance as on 31.03.13 (Maximum Rs. 13.05 Crores outstanding during the period).

(f) In our opinion, the rate of interest and other terms and conditions of unsecured loans taken by the Company are not, prima facie, prejudicial to the interest of the Company.

(g) There is no overdue amount of the principal repayable at the year end.

4. In our opinion and according to the information and explanation given to us, there is an adequate Internal Control system commensurate with the size of the Company and the nature of its business with regard to purchase of Inventory, Fixed Assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in Internal Control System.

5 (a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into Register maintained under Section 301 of the Act have been made at prices which are generally reasonable considering the strategic relationship and having regard to the prevailing market prices at the relevant time.

(b) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the Register maintained under Section 301 of the Companies Act, 1956 have been so entered.

6. In our opinion and according to the information and explanations given to us, during the year the Company has not accepted any new Deposits from the public within the purview of Sections 58A, 58AA or any other relevant provisions of the Act read with the Companies (Acceptance of Deposits) Rules, 1975.

7. As per the information and explanations given to us by the management, the Company has appointed external firm of Chartered Accountants to review internal controls procedures together with the internal checks during the year which can be considered as an internal audit commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of Sub Section (1) of Section-209 of the said Act and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate or complete.

9. (a) According to the records of the Company, undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, wealth-tax, service tax, sales tax, customs duty, excise duty, cess and other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities. Since govt. has not notified any rules under Section 441A of the Companies Act, 1956, therefore we are unable to comment on this particular issue.

b) There are no material outstanding undisputed statutory dues as at the last day of the financial year ended on 31-03-2013 for a period of more than six months from the date they become payable.

c) According to the information and explanation given to us, the following dues of Income Tax, Excise Duty and cess have not been deposited on account of some dispute with the concerned authority:

Name of Authority where Amount Involved the dispute pending (Rs. in lakhs)/ Statute Nature of Dues

Central Custom Excise & 9.41 Excise Service Tax Appeal (Year 1996) 1944. Tribunal, New Delhi (Excise Duty Related to Fire)

Custom Excise & 46.51 Service Tax Appeal (Year 2001-02-03) Tribunal, New Delhi (Excise Duty on Returned Goods)

Custom Excise & 48.21 Service Tax Appeal (Year 1999-2000) Tribunal, New Delhi (Excise Duty on Returned Goods)

Custom Excise & 14.00(Approx.) Service Tax Appeal (Year 2010-11) Tribunal, New Delhi (Interest, fine & Penalty in case of short payment of Excise Duty)

Income Commissioner 4.86 Tax Act Income Tax (Year 2008-09) 1961 (Appeals) 3.57 (Year 2002-03)

10. There are no accumulated losses of the Company. The Company has neither incurred cash losses during the Financial Year covered by our audit nor in the immediately preceding Financial Year.

11. According to the information and explanations given to us, the Company has not defaulted in the repayment of dues to the Financial Institutions or Banks. Further, there are no Debenture holders.

12. According to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of Shares, Debentures and other Securities.

13. The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund/ Society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 (hereinafter referred to as the said order) are not applicable to the Company.

14. The Company is not dealing in or trading in Shares, Securities, Debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the said Order are not applicable to the Company.

15. According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from Banks or Financial Institutions.

16. In our opinion and according to the information and explanations given to us on an overall basis, the term loans taken by the Company for augmenting long term resources of the Company towards general corporate objectives have been applied for the purpose for which they were obtained.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company in our opinion the funds raised on short- term basis have not been used for long-term investments.

18. The Company has not made any Preferential Allotment of Shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956. Accordingly, the question of reporting on whether the price at which such Shares have been issued is prejudicial to the interest of the Company does not arise.

19. The Company has not issued any Debentures. Accordingly, the question of creating a security for Debentures does not arise.

20. The Company has not raised any money by Public Issues during the year. Accordingly, the question of disclosure of end use of such monies does not arise.

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

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

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub Section (3C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the Directors as on 31st March, 2013 and taken on record by the Board of Directors, none of the Directors is disqualified as on 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.

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 said Section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

For Dinesh Mehta & Co.

Chartered Accountants

Sd/-

Deepak Malhotra

Partner

Membership No.502386

Place: New Delhi

Date: 18th May, 2013


Mar 31, 2012

We have audited the attached Balance Sheet of Dhanuka Agritech Limited ("the Company") as at 31st March, 2012 and also the Profit and Loss Account for the year ended on that date and the Cash Flow Statement for the year ended on that date; both annexed thereto. These consolidated 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.

As required by the Companies (Auditor's Report) Order 2003, (the Order) issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and in terms of information and explanations given to us and also on the basis of such checks as we considered appropriate, we report on the matters specified in paragraphs 4 and 5 of the said order as follows:-

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

The fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies were noticed on such verification.

No substantial part of the fixed assets have been disposed off during the year affecting the going concern status of the Company.

2. (a) The inventory of the Company (including stocks with third parties) has been physically verified by the management during the year according to a phased programmed normally so designed that each material item is physically verified at least once in a year and at more frequent intervals in appropriate cases.

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

3. (a) The Company during the year has not granted any loan to a Company covered in the register maintained under section 301 of the Act.

(b) In our opinion, the rate of interest and other terms and conditions of unsecured loans given by the Company are not, prima facie prejudicial to the interest of the Company. ('c &d)There is no overdue amount of the principal repayable at the year end.

(e) According to the information and explanations given to us, the unsecured loans taken by the Company from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 is by way of Inter Corporate Deposits received from 7 Companies and deposits from 4 Individuals of Rs. 807 lakhs outstanding as on 31.03.12 (Maximum outstanding during the period Rs. 1,220 lakhs).

(f) In our opinion, the rate of interest and other terms and conditions of unsecured loans taken by the Company are not, prima facie prejudicial to the interest of the Company.

(g) There is no overdue amount of the principal repayable at the year end.

4. In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

5. (a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into register maintained under Section 301 of the Act have been made at prices which are generally reasonable considering the strategic relationship and having regard to the prevailing market prices at the relevant time.

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

6. In our opinion and according to the information and explanations given to us, during the year the Company has not accepted any new deposits from the public within the purview of Sections 58A, 58AA or any other relevant provisions of the Act read with the Companies (Acceptance of Deposits) Rules, 1975.

7. As per the information and explanations given to us by the management, the Company has appointed external firm of Chartered Accountants to review internal controls procedures together with the internal checks during the year which can be considered as an internal audit commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of Sub Section (1) of Section-209 of the said Act, and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate or complete.

9. (a) According to the records of the Company, undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income- tax, wealth-tax, service tax, sales tax, customs duty, excise duty, cess and other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities.

b) There are no material outstanding undisputed statutory dues as at the last day of the financial year ended on 31-03- 2012 for a period of more than six months from the date they become payable.

c) According to the information and explanation given to us, the following dues of Income Tax, sales Tax, Excise Duty and Cess have not been deposited on account of some dispute with the concerned authority:

Name of the statute Authority where Amount Involved dispute pending (Rs.In lakhs) Nature of Dues 9.41

Custom Excise & Service Central Excise (Year 1996) Tax Appeal Tribunal, New 1944 (Excise Duty Delhi Related To Fire)

48.21

Custom Excise & Service (Year 1999-2000) Tax Appeal Tribunal, New (Excise Duty on Delhi Returned Goods)

46.51 Custom Excise & Service (Year 2001-02- Tax Appeal Tribunal, New 03) Delhi (Excise Duty on Returned Goods)

Income Tax Commissioner of Income 0.35 Act, 1961 tax (Appeals) (Year 2005-06) Commissioner of Income 5.44 tax (Appeals) (Year 2007-08)

Commissioner of Income 4.86 tax (Appeals) (Year 2008-09)

Commissioner of Income 4.61 tax (Appeals) (Year 2009-10)

10. There are no accumulated losses of the Company. The Company has neither incurred cash losses during the financial year covered by our audit nor in the immediately preceding financial year.

11. According to the information and explanations given to us, the Company has not defaulted in the repayment of dues to the Financial Institution or Banks. Further, there are no debenture holders.

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

13. The Company is not a chit fund or a nidhi / mutual benefit fund/ society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 (hereinafter referred to as the said Order) are not applicable to the Company.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the said Order are not applicable to the Company.

15. According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information and explanations given to us on an overall basis, the term loans taken by the Company for augmenting long term resources of the Company towards general corporate objectives have been applied for the purpose for which they were obtained.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company in our opinion the funds raised on short-term basis have not been used for long-term investments.

18. The Company has not made any preferential allotment of shares to parties and Companies covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the question of reporting on whether the price at which such shares have been issued is prejudicial to the interest of the Company does not arise.

19. The Company has not issued any debentures. Accordingly, the question of creating a security for debentures does not arise.

20. The Company has not raised any money by public issues during the year. Accordingly, the question of disclosure of end use of such monies does not arise.

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

Further to our comments above, we report that:

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

b) In our opinion, proper books of account as required by the Companies Act, 1956 (as amended) have been kept by the Company so far as appears from our examination of these books;

c) The Balance Sheet, the Profit & Loss Account and the Cash Flow Statement referred to in this report are in agreement with the books of account.

d) In our opinion, the Balance Sheet, the Profit & Loss Account and the Cash Flow Statement referred to in this report complied with the Accounting Standards as referred to in Section 211(3C) of the Companies Act, 1956;

e) On the basis of written representations received from the Directors and taken on record by the Board of Directors, we report that none of the Directors of the Company is disqualified from being appointed as Director under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956; and

f) In our opinion and to the best of our information and according to the explanations given to us, they said Accounts, read with other notes thereon, forming part of the accounts, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view:

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

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

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

For Dinesh Mehta & Co.

Chartered Accountants

FRN-000220N Sd/-

Anup Mehta

Partner

Membership No.93133

Place: New Delhi

Date : May 23, 2012


Mar 31, 2010

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.

As required by the Companies (Auditors Report) Order 2003 (the Order) issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and in terms of information and explanations given to us and also on the basis of such checks as we considered appropriate, we state that: -

1. (a) The Company has maintained proper records

showing full particulars including quantitative details and situation of fixed assets.

(b) The fixed assets were physically verified by the management at reasonable interval, no material discrepancies were noticed on such verification.

(c) No substantial part of the fixed assets have been disposed off during the year affecting the going concern status of the Company.

2. (a) The inventory of the company (including stocks

with third parties) has been physically verified by the management during the year according to a phased programmed normally so designed that each material item is physically verified at least once in a year and at more frequent intervals in appropriate cases. In respect of inventory lying with the third parties, these have substantially been confirmed by them. In our opinion the frequency of verification is reasonable.

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

3. (a) The company has granted unsecured loan to one company covered in the register maintained under section 301 of the Act and the balance outstanding as at the year end was Rs 1,53,987/- (Maximum balance outstanding during the year was Rs 5.60 crs)

(b) In our opinion, the rate of interest and other terms and conditions of unsecured loans given by the Company are not, prima facie prejudicial to the interest of the company.

(c&d) There is no overdue amount of the principal repayable at the year end.

(e) According to the information and explanations given to us, the unsecured loan taken by the Company from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 is by way of:

(i) Inter Corporate Deposits taken from 10 companies covered in the register maintained under section 301 of the Act and the balance outstanding as at the year end was Rs 8.13 Crs (Maximum balance outstanding during the year was Rs. 9.27 Crs).

(ii) Fixed deposit taken from 18 persons and the balance outstanding as at the year end was Rs.9.83 lacs (Maximum balance outstanding during the year was Rs 25.61 lacs).

(f) In our opinion, the rate of interest and other terms and conditions of unsecured loans taken by the Company are not, prima facie prejudicial to the interest of the company.

(g) There is no overdue amount of the principal repayable at the year end.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

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

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into register maintained under Section 301 of the Act have been made at prices which are generally reasonable considering the strategic relationship and having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, during the year the Company has not accepted any new deposits from the public within the purview of Sections 58A, 58AA or any other relevant provisions of the Act read with the Companies (Acceptance of Deposits) Rules, 1975. The deposits unpaid as at the year end are those deposits which got transferred from Northern Minerals Limited (the transferee Company) due to merger and have not become due for payment. As per the information and explanations given to us, no order under aforesaid Sections has been passed by the Company Law Board or National Company Law Tribunal or the Reserve Bank of India or any court or any other Tribunal in this respect on the Company.

7. As per the information and explanations given to us by the management, the Company has appointed M/s Manoj Ritu & Associates, Chartered Accountants to review internal controls procedures together with the internal checks during the year which can be considered as an internal audit commensurate with the size and nature of its business.

8. The company, in our opinion and according to the information and explanations given to us, has made and maintained accounts and records pursuant to the rules made by the Central Government for maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956, in respect of pesticides. We have, however not made a detailed examination of such records with a view to ascertain whether these are complete and accurate.

9.(a) According to the records of the company, undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, wealth- tax, sales tax, customs duty, excise duty, cess and other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities.

b) There are no material outstanding undisputed statutory dues as at the last day of the financial year ended on 31-03-2010 for a period of more than six months from the date they become payable.

c). According to the information and explanation given to us, the following dues of Income Tax, sales Tax , Excise Duty and Cess have not been deposited on account of some dispute :

Name of the Authority where Amount Involved Statute dispute pending (Rs-In Lacs) / Nature of Dues

Central Excise Custom Excise & 9.41 Act 1944. Service Tax Appellate (year 1996)(Excise Duty Tribunal, New Delhi Related To Fire)

Custom Excise & 46.51 Service Tax Appellate (Year 2001-02-03)(Excise Tribunal, New Delhi Duty on Returned Goods)

Custom Excise & 48.21 Service Tax Appellate (Year 1999-2000)(Excise Tribunal, New Delhi Duty on Returned Goods)

Income Tax Commissioner of 6.93 Act 1961 Income Tax (Year 2005-2006) (Appeals) Commissioner of 8.93 Income Tax (Year 2006-2007) (Appeals)

Commissioner 5.44 of Income Tax (Year 2007-2008) (Appeals)

Central Sales Dy. Commissioner, 1.88 Tax Act, 1956 Officer, Bhopal (Year 2000-2001)

0.75 (Year 2002-2003)

10. There are no accumulated losses of the Company. The company has neither incurred cash losses during the financial year covered by our audit nor in the immediately preceding financial year.

11. According to the information and explanations given to us, the company has not defaulted in the repayment of dues to the Banks. Further, there are no debenture holders.

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

13. The company is not a chit fund or a nidhi / mutual benefit fund/ society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 (hereinafter referred to as the said Order) are not applicable to the company.

14. The company is not dealing in or trading in shares, securities, debentures and other

ihvestments. Accordingly, the provisions of clause 4(xiv) of the said Order are not applicable to the company.

15. According to the information and explanations given to us, the company has not given any guarantees for loans taken by others from banks orfinancial institutions.

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

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the company in our opinion the funds raised on short-term basis have not been used for long-term investments and vice-versa.

18. The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the question of reporting on whether the price at which such shares have been issued is prejudicial to the interest of the company does not arise.

19. The company has not issued any debentures. Accordingly, the question of creating a security for debentures does not arise.

20. The company has not raised any money by public issues during the year. Accordingly, the question of disclosure of end use of such monies does not arise.

21. According to the information and explanations given to us, some employees of the company has allegedly done some unauthorized foreign exchange transactions with the bank and the same was reported with the law enforcing agencies for investigation and initiating appropriate action under the law. The company has terminated services of two employees and suspended one employee, while pending completion of enquiry. Refer note no. 11 of Notes to Accounts.

Further to the above, we report that:

a) we have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion, proper books of account as required by the Companies Act, 1956 (as amended) have been kept by the Company so far as appears from our examination of these books;

c) The Balance Sheet, the Profit & Loss Account and the Cash Flow Statement referred to in this report are in agreement with the books of account.

d) in our opinion, the Balance Sheet, the Profit & Loss Account and the Cash Flow Statement referred to in this report complied with the Accounting Standards as referred to in Section 211(3C)ofthe Companies Act, 1956;

e) on the basis of written representations received from the directors and taken on record by the Board of Directors, we report that none of the directors of the company is disqualified from being appointed as director under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956; and

f) in our opinion and to the best of our information and according to the explanations given to us, the said Accounts, read with other notes thereon, given in the schedule T forming part of the accounts, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view:

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

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

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

For Dinesh Mehta & Co. Chartered Accountants Firm Registration No.-000220-N Sd/- Deepak Malhotra Partner Membership No.502386

Place: New Delhi Date : 29.05.2010

 
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