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Auditor Report of Eastern Sugar & Industries Ltd.

Jun 30, 2014

We have audited the attached Balance Sheet of EASTERN SUGAR & INDUSTRIES LIMITED as at 30th June, 2014, the Statement of Profit & 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

The Company's 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 Section 211(3C) of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material 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 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 the accounting policies used and the reasonableness of the accounting estimates made by the 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 aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 30th June, 2014;

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

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

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order, 2003 ("the Order") issued by the Central Government in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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 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 Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in Section 211(3C) of the Act.

On the basis of the written representations received from the directors as on 30th June, 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 30th June, 2014 from being appointed as a director in terms of Section 274(1)(g) of the Act.

(Referred to in paragraph 7 under 'Report on Other Legal and Regulatory Requirements' section of our report of even date)

1. The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets. We are informed that all the fixed assets have been physically verified by the management at the year-end and no material discrepancies have been noticed on such verification. No disposal of a substantial part of the fixed assets of the Company has taken place during the reporting period.

2. The inventories were physically verified during the year by the Management at reasonable intervals. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventory followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business. The Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

4. The Company has adequate internal control procedures commensurate with the size of the Company and nature of its business with regard to purchase of trading goods, raw materials including components, plant and machinery, equipment and other assets and also for the sale of goods. We have not come across any major weaknesses in internal control.

5. According to the information & explanation given to us there is no contract or arrangement that's needs to be entered in the register required to be maintained under sec 301 of the Companies Act.

6. The company has not accepted any deposits within the meaning of section 58A, 58AA or any other relevant provisions of Act and the rules framed there under.

7. In our opinion, the internal audit system of the Company is commensurate with the size and the nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records in respect of sugar u/s 290(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed account and records have been maintained.

9. The Company is generally regular in depositing undisputed statutory dues, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues.

10. According to the information and explanations given to us, no disputed amount payable in respect of Income Tax, Wealth Tax, Dividend Tax, Service Tax, Sales Tax, Custom Duty, Excise Duty and Cess were in arrears, as at 30th June, 2014 for a period of more than six months from the date they became payable.

11. The Company has no accumulated losses and has not incurred any cash loss during the year covered by our audit or in the immediately preceding financial year.

12. The Company has not defaulted in payment of dues to financial institution or banks. The company has not issued any debentures.

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

14. In our opinion and according to the information and explanations given to us, the nature of activities of the Company does not attract any special statute applicable to chit fund and nidhi/mutual benefit fund/societies.

15. In our opinion and according to information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments and therefore the provisions of Clause 4(xiv) of the order are not applicable. The securities and other investments have been held by the company in its own name.

16. The Company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the reporting period.

17. The Company has not raised any term loans, so the provisions are not applicable to the Company.

18. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term requirements.

19. During the year the company has not issued and allotted any Preferential Shares.

20. The Company has not raised any money during the year through any public issue.

21. Based on the audit procedures adopted and information and explanations given to us by the management, no fraud on or by the Company has been noticed or reported during the course of our audit.

For Vivek Jaiswal & Co. Chartered Accountants Firm Registrartion No. 323094E

Vivek Jaiswal Place : Kolkata Partner Date : 22nd September, 2014 M. No. 057710




Jun 30, 2013

Report on Financial Statements

We have audited the attached Balance Sheet of EASTERN SUGAR & INDUSTRIES LIMITED as at 30th June, 2013, the Statement of Profit & 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

The Company''s 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 Section 211(3C) of the Companies Act, 1956 (''the Act'') and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

Basis for qualified opinion

Non compliance of sections 194-A, 192 & 192-J, of Income Tax Act, 1961 with respect to TDS on interest other than interest on securities , salary, & fee for professional & Technical services respectively. The TDS on above have not been deducted and deposited in time. *

Non compliance of generally accepted accounting principles in accounting of Gratuity, Leave liabilities towards employees, bonus, Professional Taxes, Trade License Fees, Interest and penalty

on delayed deposit of TDS & income from interest on securities and other deposits as they are accounted for on cash basis.*

*The possible loss if any, arising out of above which might have consequential effect on the year''s Profit & Loss and Net Current Asset position of the Company at the year end, has neither been ascertained nor provided for in these accounts.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 30th June, 2013;

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

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

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor''s Report) Order, 2003 (''the Order'') issued by the Central Government in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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 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 Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in Section 211(3C) of the Act.

On the basis of the written representations received from the directors as on 30th June, 2013 taken on record by the Board of Directors, none of the directors is disqualified as on 30th June, 2013 from being appointed as a director in terms of Section 274(1)(g) of the Act.

Annexure to the Independent Auditors'' Report

(Referred to under ‘Report on Other Legal and Regulatory Requirements'' section of our report of even date)

1. The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets. We are informed that all the fixed assets have been physically verified by the management at the year-end and no material discrepancies have been noticed on such verification. No disposal of a substantial part of the fixed assets of the Company has taken place during the reporting period.

2. The inventories were physically verified during the year by the Management at reasonable intervals. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventory followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business. The Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

4. The Company has adequate internal control procedures commensurate with the size of the Company and nature of its business with regard to purchase of trading goods, raw materials including components, plant and machinery, equipment and other assets and also for the sale of goods. We have not come across any major weaknesses in internal control.

5. According to the information & explanation given to us there is no contract or arrangement that''s needs to be entered in the register required to be maintained under sec 301 of the Companies Act.

6. The company has not accepted any deposits within the meaning of section 58A, 58AA or any other relevant provisions of Act and the rules framed there under.

7. In our opinion, the internal audit system of the Company is commensurate with the size and the nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records in respect of sugar u/s 290(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed account and records have been maintained.

9. The Company is generally regular in depositing undisputed statutory dues, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues.

10. According to the information and explanations given to us, no disputed amount payable in respect of Income Tax, Wealth Tax, Dividend Tax, Service Tax, Sales Tax, Custom Duty, Excise Duty and Cess were in arrears, as at 30th June, 2013 for a period of more than six months from the date they became payable.

11. The Company has no accumulated losses and has not incurred any cash loss during the year covered by our audit or in the immediately preceding financial year.

12. The Company has not defaulted in payment of dues to financial institution or banks. The company has not issued any debentures.

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

14. In our opinion and according to the information and explanations given to us, the nature of activities of the Company does not attract any special statute applicable to chit fund and nidhi/mutual benefit fund/societies.

15. In our opinion and according to information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments and therefore the provisions of Clause 4(xiv) of the order are not applicable. The securities and other investments have been held by the company in its own name.

16. The Company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the reporting period.

17. The Company has not raised any term loans, so the provisions are not applicable to the Company.

18. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term requirements.

19. During the year the company has issued 49,00,000 bonus equity shares to the existing Cumulative Convertible Preference Share Holders out of the General Reserves of the company.

20. The Company has not raised any money during the year through any public issue.

21. Based on the audit procedures adopted and information and explanations given to us by the management, no fraud on or by the Company has been noticed or reported during the ourse of our audit.

For Vivek Jaiswal & Co.

Chartered Accountants

Firm Registrartion No. 0325948E

Vivek Jaiswal

Place : Kolkata Partner

Date : 18th September, 2013 M. No. 057710


Jun 30, 2012

We have audited the attached Balance Sheet of EASTERN SUGAR & INDUSTRIES LIMITED as at 30th June, 2012 and also the Profit & Loss Account for the year ended on that date annexed here to and the Cash Flow Statement for the year ended on that date, which we have signed under reference to this report. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. These 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 of our opinion.

1. As required by the Companies (Auditor''s Report) Order, 2003, as amended by the Companies (Auditor''s Report) (Amendment) Order, 2004 issued by Central Government of India, in terms of sub section (4A) of Section 227 of the Companies Act, 1956, and on the basis of the information and explanations given to us and the books and records examined by us in the normal course of our audit and to the best of our knowledge and belief, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

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

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

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

d) In our opinion the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956, subject to the provision for Gratuity which is not done as prescribed in AS-15.

e) On the basis of written representations received from the individual directors and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th June, 2012 from being appointed as a director in terms of clause (g) of Sub- section (1) of Section 274 of the Companies Act, 1956.

3. In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet, the Profit & Loss Account and Cash Flow Statement gives the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: -

i) In the case of Balance sheet, of the state of affairs of the Company as at 30th June,

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 Cash Flow Statement, of the cash flow for the year ended on that date.

(i) FIXED ASSETS

a) The company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.

b) The assets have been physically verified by the management during the year according to a phased programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets No material discrepancies were noticed on such verification.

c) There was no substantial disposal of fixed assets during the year.

(ii) INVENTORIES

a) According to the information and explanations given to us, and in our opinion, the inventory has been physically verified by the management at reasonable intervals.

b) According to the information and explanations given to us, the procedure of inventories followed by the Company are reasonable and adequate in relation to the size of the Company and nature of its business.

c) The Company is maintaining proper records of inventory and according to the information and explanations given to us, discrepancies noticed on physical verification were not material and the same have been properly dealt with in the books of account.

(iii) LOANS

a) As informed the Company has neither granted nor taken any loans, secured or unsecured, form™ companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 during the year.

b) Such loans taken in earlier years are stated to be free of interest and repayable on demand and in our option, other terms and conditions on which loans have been taken are not, prima facie prejudicial to the interest of the company.

c) The Company, as informed, is regular in repaying the principal amounts.

(vi) In our opinion and according to the information and explanations given to us, there are adequate Internal control procedures commensurate with the size of the company and the nature of its bus ness with regard to purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls.

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

(vi) The company has not accepted any deposits from public during the year.

(vii) In our opinion, the company has an adequate internal audit system commensurate w.th the size of the Company and the nature of its business.

(viii) As informed to us, the Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for the business the Company has carried on during the year.

(ix) STATUTORY DUES:

a) Based on our audit procedures and on the basis of books of accounts and records produced before us and information and explanations given by the management, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident fund, Investor education and protection fund, Employees'' state insurance, income tax, sales tax, wealth tax., service tax, customs duty, excise duty, cess and other material statutory dues applicable to it. No undisputed statutory dues were outstanding as at 30 th June for more than 6 months from the date they became payable.

b) According to the information and explanations given to us, there are no disputed dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty and cess.

(x) The Company has no accumulated loss at the end of the current accounting year. Further, the Company has not incurred any cash loss in the current accounting year as well as in the immediately preceding accounting year.

(xi) Based on our audit procedure and on the basis of information and explanations given by the management, the Company has defaulted in repayment of the Secured Loans from the bank and Financial institution, but the company is in negotiation with the said banks and Financial Institution and the matter is expected to be settled soon. There were no borrowings in the form of Debentures.

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

(xiii) The Company is not a chit fund or a nidhi/mutual fund/society.

(xiv) The company is not dealing in or trading in shares, securities, debentures and other investments.

(xv) According to the information given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions during the year.

(xvi) The Company has not taken any term loan during the year and according to the information and explanations given to us, the outstanding term loans were applied for the purpose for which the same were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no new funds have been raised during the year on short-term basis.

(xviii)The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issue.

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

For Vivek Jaiswal & Co.

Chartered Accountants

2A, Ganesh Chandra Avenue, Vivek Jaiswal

Kolkata-700 013 Partner

Date: 7th September, 2012 M. No - 057710


Jun 30, 2011

1. We have audited the attached Balance Sheet of EASTERN SUGAR & INDUSTRIES LIMITED as at 30th June 2011 and also the Profit & Loss Account and the Cash Fahd Statement for the year ended on that date annexed thereto, which we have signed uncle reference to this report. These financial statements are the responsibility of the Company management. Our responsibility is to express an opinion on these financial statesman based on our audit.

2. We conducted our audit in accordance with generally accepted auditing standards in And These Standards require that we plan and perform the audit to obtain reasonable assurer about whether the financial statements are free of material mis-statements. An audit incur examining, on a test basis, evidence supporting the amounts and disclosure in the finance statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statesman presentation. We believe that our audit provides a reasonable basis for our opinion.

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

4. Further to our comments in the Annexure referred to alcove, we report that:—

a) We have obtained all the information and explanations which to the best of 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 I Company, so far as it appears from cur examination of those books and proper retie adequate for the purposes of our audit have been received from the branches visited by us.

c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement referred to in c report are in agreement with the books of accounts as submitted to us;

d) In our opinion the Balance Sheet, Profit & Loss Account and Cash Flow Starter dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

e) On the basis of management representations received from the Directors in write and taken on record by the Board, none of the directors of the company are disqualify from being appointed as a Director in terms of clause (g) of sub - section (1) of section 274 of the Companies Act, 1956;

In our opinion and to the best of our information and according to the explanations given to us, they said Accounts read together with Note No.3 in respect of gratuity & leave liability and other NOTES to Schedule 15 give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India :—

a) In the case of Balance sheet, of the state of affairs of the Company as at 30th June, 2011

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

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

(Referred to in paragraph 3 of our report of even date)

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

b) The assets have been physically verified by the management during the year accord to a phased programme of verification which, in our opinion, is reasonable ha'' regard to the size of the company and the nature of its assets. No material discrepant* were noticed on such verification.

c) There was no substantial disposal of fixed assets during the year.

(ii) a) According to the information and explanations given to us, and in our opinion, inventory has been physically verified by the management at reasonable intervals

b) According to the information and explanations given to us, the procedure of pays verification of inventories followed by the Company are reasonable and adequate relation to the size of the Company and nature of its business.

c) The Company is maintaining proper records of inventory and according to the informs and explanations given to us, discrepancies noticed on physical verification were material and the same have been properly dealt with in the books of account.

(iii) a) As informed, the Company has neither granted nor taken any loans, secured unsecured, to/from companies, firms or other parties covered in the register maintain under section 301 of the Companies Act, 1956 during the year.

b) Such loans taken in earlier years are stated to be free of interest and repay demand and in our opinion, other terms and conditions on which loans have b taken are not, prima facie, prejudicial to the interest of the company.

c) The Company, as informed, is regular in repaying the principal amounts.

(iv) In our opinion and according to the information and explanations given to us, there adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchases of inventory and fixed assets and for sale of goods and services. During the course of our audit, no major weakness has b noticed in the internal controls.

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

(vi) The company has not accepted any deposits from public during the year.

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

(viii) As informed to us, the Central Government has not prescribed maintenance of cost reek under section 209(1 )(d) of the Companies Act, 1956 for the business the Company carried on during the year.

(ix) a) Based on our audit procedures and on the basis of books of accounts and produced before us and information and explanations given by the management, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident fund, Investor education and protection fund, Employees'' state insurance, income tax, sales tax, wealth tax., service tax, customs duty, excise duty, cess and other material statutory dues applicable to it. No undisputed statutory dues were outstanding as at 30 the June for more than 6 months from the date they became payable.

b) According to the information and explanations given to us, there are no disputed dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty and cess.

(x) The Company has no accumulated loss at the end of the current accounting year. Further, the Company has not incurred any cash loss in the current accounting year as well as in the immediately preceding accounting year.

(xi) Based on our audit procedure and on the basis of information and explanations given by the management, the Company has defaulted in repayment of the Secured Loans from the bank and Financial institution, but the company is in negotiation with the said banks and Financial Institution and the matter is expected to be settled soon. There were no borrowings in the form of Debentures.

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

(xiii) The Company is not a chit fund or a nidhi/mutual fund/society.

(xiv) The company is not dealing in or trading in shares, securities, debentures and other investments.

(xv) According to the information given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions during the year.

(xvi) The Company has not taken any term loan during the year and according to the information and explanations given to us, the outstanding term loans were applied for the purpose for which the same were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no new funds have been raised during the year on short-term basis.

(xviii) The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issue.

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

For Vivek Jaiswal & Co.

Chartered Accountants

2A, Ganesh Chandra Avenue, Vivek Jaiswal

Kolkata-700 013 Partner

Date: 26th August, 2011 M. No. 057710


Jun 30, 2010

1. We have audited the attached Balance Sheet of EASTERN SUGAR & INDUSTRIES LIMITED as at 30th June, 2010 and also the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosure 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 statements presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, issued by the Central 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.

4. Further to our comments in the Annexure referred to 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 accounts, as required by law have been kept by the Company, so far as appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.

c) The Balance Sheet, Profits Loss Account and Cash Flow Statement referred to in our this report are in agreement with the books of accounts as submitted to us.

d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

e) On the basis of management representations received from the Directors in writing and taken on record by the Board, we report that none of the directors is disqualified from being appointed as a Director in terms of clause (g) of sub - section (1) of section 274 of the Companies Act, 1956.

In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India.

a) In the case of Balance sheet, of the state of affairs of the Company as at 30th June, 2010;

b) In the case of Profit & Loss Account, of the Profit for the year ended on that date;

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

ANEXURETOTHE AUDITORS' REPORT

(Referred to in paragraph 3 of our report of even date)

1) FIXED ASSETS

(a) The company is maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) All the assets have been physically verified by the management during the year and there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) in our opinion and according to the information and explanations given to us, no substantial part of fixed assets has been disposed off by the Company during the year.

2) INVENTORIES

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

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the nature of its business.

(c) On the basis of our examination of the records of inventory, in our opinion ,the Company is maintaining proper of inventory. The discrepancies noticed on physical verification of stock as compared to the book records were not material.

3) LOANS

(a) As informed, the Company has neither granted nor taken any secured or unsecured loan to/from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 during the year.

(b) Such loans taken in earlier years are stated to be free of interest and repayable on demand and in our opinion, other terms and conditions on which loans have been taken are prima facie, prejudicial to the interest of the Company.

(c) The Company, as informed, is regular in payment of the the principal amounts.

(4) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weakness in the aforesaid internal control procedures.

5) RELATED PARTY TRANSACTIONS

a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into the register in pursuance to Section 301 of the Companies Act, 1956 have been so entered.

b) In our opinion and according to the information and explanations given to us , the transactions made in pursuance of contracts or arrangements entered in the registers maintained under Section 301 and exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(6) In our opinion and according to the information and explanations given to us, the company has not accepted deposits within the meaning of the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the Rules made thereunder.

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

(8) We have broadly reviewed the books of accounts maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records in respect of Sugar under Section 209(1) (d) of the Companies Act, 1956 are of the opinion that prime facie the prescribed accounts have been made and maintained . We have however not made a details examination of the records with view to determine whether they are accurate and complete.

(9) Statutory Dues:

(a) According to the records of the Company, the Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth tax, Customs Duty, Excise Duty, Cess and other statutory dues applicable to it with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no undisputed amount payable in respect of Income Tax, Sales Tax, Wealth Tax, Customs Duty, Excise Duty and Cess as at 30th June, 2010 for more than 6 months from the they became payable.

(10) The Company has no accumulated loss at the end of the financial year ended on 30th June, 2010. The company has not incurred any cash loss during the financial year year ended on that date as well as in the immediately preceding financial year.

(11) According to the records of the Company examined by us and the information and explanations given by the management the Company has defaulted in repayment of Secured Loans to a Financial institution and bank as at the Balance Sheet date, but the company is in negotiation with the said bank and Financial Institution and the matter is expected to be settled soon. There were no borrowings in the form of Debentures.

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

(13) The provisions of any special statute applicable to a chit fund / nidhi/mutual benefit fund/societies are not applicable to the Company.

(14) In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

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

(16) Based on the information and explanations given to us and on an overall examination of Balance Sheet of the Company, no new short term funds have been raised during the year.

(17) The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(18) The Company has not raised any money by public issues.

(19) 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 explanations 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 VIVEK JAISWAL & CO.

Chartered Accountants

Place : 2A, Ganesh Chandra Avenue, (Vivek Jaiswal)

Kolkata-700 013. Partner

Date : 28thAugust,2010 (M. No. 057710)

 
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