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Auditor Report of Eastern Treads Ltd.

Mar 31, 2017

The Members of Eastern Treads Limited Kochi

Report on the Financial Statements

We have audited the accompanying financial statements of Eastern Treads Limited, which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

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

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 amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.

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

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

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 March 31, 2017;

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

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

1. As required by the Companies (Auditor’s Report) Order, 2016 issued by the Central Government of India in terms of sub-Section (11) of Section 143 of The Companies Act 2013, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 it 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, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns received from branches not visited by us.

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

e. On the basis of written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164(2)of the Act.

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

a) the Company has the following pending litigations which would impact its financial position:

Name of the Statute

Nature of Dues

Amount (Rs.)

Period to which the amount relates

Forum where dispute is pending

Amount paid under Protest (Rs.)

The Kerala General Sales Tax Act, 1963

KGST

Assessment

24,98,936

1996-2002 (7 years)

The Honourable Supreme Court of India

24,98,936

The Central Sales Tax Act, 1956

CST

Assessment

19,04,578

1996-2002 (7 years)

The Honourable Supreme Court of India

19,04,578

The Central Sales Tax Act, 1956

CST

Assessment

1,80,898

2002-2003

Deputy Commissioner (Appeals), Ernakulam

1,80,898

The Central Sales Tax Act, 1956

CST Assessment

1,75,940

2004-2005

Deputy Commissioner (Appeals), Ernakulam

1,75,940

The Kerala General Sales Tax Act 1963

KGST Assessment

3,450

2008-2009

Deputy Commissioner (Appeals), Ernakulam

3,450

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

47,275

2008-2009

Deputy Commissioner (Appeals), Ernakulam

47,275

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

14,400

2009-2010

Deputy Commissioner (Appeals), Ernakulam

14,400

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

3,570

2011-2012

Deputy Commissioner (Appeals), Ernakulam

3,570

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

15,985

2010-2011

Intelligence Squad, Thodupuzha

15,985

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

28,703

2015-2016

Intelligence Squad, Thodupuzha

28,703

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

8,137

2009-2010

Deputy Commissioner (Appeals), Ernakulam

8,137

The Kerala General Sales Tax Act, 1963

KGST Assessment

1,50,133

2010-2011

Assistant Commissioner Special Circle Perumbavoor

1,50,133

The Kerala General Sales Tax Act, 1963

KGST Assessment

6,37,992

2011-2012

Assistant Commissioner Special Circle Perumbavoor

1,27,600

The Kerala General Sales Tax Act, 1963

Demand on Vehicle Interception

37,700

2016-2017

Intelligence Squad, Edapally

37,700

b) The Company does not have any long-term contracts requiring a provision for material foreseeable losses.

c) The Company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

d) The Company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company.

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF EASTERN TREADS LIMITED Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section 143 of the Companies Act, 2013

We have audited the internal financial controls over financial reporting of Eastern Treads Limited as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.

These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting and the Standards on Auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that:

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

Annexure referred to in paragraph 1 of our Report of even date to the members of Eastern Treads Limited on the accounts of the Company for the period ended 31st March, 2017.

In terms of Companies (Auditor''s Report) Order 2016, issued by Central Government of India, in terms of Section 143(11) of The Companies Act, 2013, we further report, on the matters specified in paragraph 3 and 4 of the said Order, that:-

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

(ii). Fixed assets have not been physically verified by the management at regular intervals.

(iii). The title deeds of immovable properties shown in the financial statements are held in the name of the Company.

2. Physical verification of inventory has been conducted at reasonable intervals by management. The discrepancies notices were properly dealt with in the books of account of the Company.

3. The Company has not granted any loans, secured or unsecured to companies, firms, LLPs, or other parties covered in register maintained under Section 189 of The Companies Act, 2013.

4. The Company has not given any loans or guarantees/made any investments within the meaning of Section 185 & 186 of The Companies Act, 2013.

5. The Company has not accepted any deposits.

6. We have broadly reviewed the cost records maintained by the Company as specified in sub-Section (1) of Section 148 of The Companies Act, 2013 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

7. (i) The Company is regular in depositing undisputed statutory dues with appropriate authorities.

(ii) According to records of Company, there are no statutory dues which have not been deposited on account of any dispute, except the following:

Name of the Statute

Nature of Dues

Amount (Rs.)

Period to which the amount relates

Forum where dispute is pending

Amount paid under Protest (Rs.)

The Kerala General Sales Tax Act, 1963

KGST Assessment

6,37,992

2011-2012

Assistant Commissioner Special Circle Perumbavoor

5,10,392

8. The Company has not defaulted in any repayment of dues to any financial institution or bank or debenture holders.

9. The term loans has been utilized for the purposes for which they were obtained.

10. Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud by the Company or on the Company by its officers/employees have been noticed or reported during the course of our audit.

11. The Company is not paying any managerial remuneration other than sitting fees.

12. The transactions entered into with related parties are in compliance with Section 177 & 188 of The Companies Act 2013 and the details have been disclosed in the financial statements etc. as required by the applicable accounting standards.

13. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

14. The Company has not entered into any non-cash transactions with directors or persons connected with him, during the year.

15. The Company is not required to be registered under Section 45-IA of The Reserve Bank of India Act, 1934.

For JVR & Associates

Chartered Accountants

(F. R. No. 011121S)

Kochi-16 Jomon K George

04/05/2017 Partner

M.No.202144


Mar 31, 2015

Report on the Financial Statements

We have audited the accompanying financial statements of EASTERN TREADS LIMITED, which comprise the Balance Sheet as at March 31, 2015 and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent, and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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 amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.

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

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

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 March 31, 2015;

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

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

Emphasis of Matter

We draw attention to ''Short Term Loans & Advances'' (Note no.20), which includes an amount of RS. 57.65 lakhs receivable from a party, the recoverability of which is not fully certain in the absence of conclusive evidence for the same. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2015 issued by the Central Government of India in terms of Sub-Section (11) of Section 143 of the Companies Act 2013, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 it 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, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns received from branches not visited by us.

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

e. On the basis of written representations received from the directors as on March 31, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164(2) of the Act.

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 the following pending litigations which would impact its financial position:

Name of the Nature of Dues Amount in RS. Period to Which Statute the amount relates

The Central CST 3,80,200.00 2008-2009 Sales Tax Assessment Act, 1956

The Central CST 5,05,616.00 2009-2010 Sales Tax Assessment Act, 1956

The Kerala KGST 24,98,936.00 1996-2002 General Assessment (7 years) Sales Tax Act, 1963

The Central CST 19,04,578.00 1996-2002 Sales Tax Assessment (7 years) Act, 1956

The Central CST 1,80,898.00 2002-2003 Sales Tax Assessment Act, 1956

The Central CST 1,75,940.00 2004-2005 Sales Tax Assessment Act, 1956

Name of the Forum where dispute is Amount paid under Statute pending Protest

The Central Deputy 0.00 Sales Tax Commissioner(Appeals), Act, 1956 Ernakulam

The Central Deputy Sales Tax Commissioner(Appeals), 1,51,685.00 Act, 1956 Ernakulam

The Kerala The Honourable 19,04,578.00 General Supreme Court of India Sales Tax Act, 1963

The Central The Honourable 24,98,936.00 Sales Tax Supreme Court of India Act, 1956

The Central Deputy Sales Tax Commissioner(Appeals), 1,80,898.00 Act, 1956 Ernakulam

The Central Deputy 1,75,940.00 Sales Tax Commissioner(Appeals), Act, 1956 Ernakulam

ii) the Company does not have any long-term contracts requiring a provision for material foreseeable losses.

iii) the Company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

The Annexure referred to in paragraph 1 of our Report of even date to the members of Eastern Treads Limited on the accounts of the Company for the period ended 31st March, 2015.

In terms of Companies (Auditor''s Report) Order 2015, issued by Central Government of India, in terms of Section 143(11) of The Companies Act, 2013, we further report, on the matters specified in paragraph 3 and 4 of the said Order, that:

1) (i) The company is maintaining proper records showing full particulars, including quantitative details and

situation of fixed assets, which however requires to be updated.

(ii) Fixed assets have not been physically verified by the management at regular intervals.

2) (i) Physical verification of inventory has been conducted at reasonable intervals by management.

i. Procedures of physical verification of inventory followed by management are reasonable and adequate in relation to size of company and nature of its business.

ii. The company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

3) The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in register maintained under Section 189 of The Companies Act, 2013.

4) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchases of inventory and fixed assets and for the sale of goods and services. There is no continuing failure to correct weaknesses in internal controls.

5) The company has not accepted any deposits.

6) We have broadly reviewed the cost records maintained by the company as specified in subsection (1) of Section 148 of The Companies Act, 2013 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

7) i. The company is regular in depositing undisputed statutory dues with appropriate authorities.

ii. According to records of company, there are no statutory dues which have not been deposited on account of any dispute, except the following:

Name of the Nature of Dues Amount in RS. Period to Which Statute the amount relates

The Central CST 3,80,200.00 2008-2009 Sales Tax Assessment Act, 1956

The Central CST 5,05,616.00 2009-2010 Sales Tax Assessment Act, 1956

The Kerala KGST 24,98,936.00 1996-2002 General Assessment (7 years) Sales Tax Act, 1963

The Central CST 19,04,578.00 1996-2002 Sales Tax Assessment (7 years) Act, 1956

The Central CST 1,80,898.00 2002-2003 Sales Tax Assessment Act, 1956

The Central CST 1,75,940.00 2004-2005 Sales Tax Assessment Act, 1956

Name of the Forum where dispute is Amount paid under Statute pending Protest

The Central Deputy 0.00 Sales Tax Commissioner(Appeals), Act, 1956 Ernakulam

The Central Deputy Sales Tax Commissioner(Appeals), 1,51,685.00 Act, 1956 Ernakulam

The Kerala The Honourable 19,04,578.00 General Supreme Court of India Sales Tax Act, 1963

The Central The Honourable 24,98,936.00 Sales Tax Supreme Court of India Act, 1956

The Central Deputy Sales Tax Commissioner(Appeals), 1,80,898.00 Act, 1956 Ernakulam

The Central Deputy 1,75,940.00 Sales Tax Commissioner(Appeals), Act, 1956 Ernakulam

iii. The Company does not have any amounts which are required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of The Companies Act, 1956 and rules made thereunder.

8) The accumulated loss of the Company is not more than fifty percent of its net worth. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

9) The Company has not defaulted in any repayment of dues to any financial institution or bank or debenture holders.

10) The Company has not given any guarantee for loans taken by others from any bank or financial institution.

11) The term loans has been utilised for the purposes for which they were obtained.

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

For JVR & Associates Chartered Accountants (F. R. No. 011121S)



Jomon K. George Kochi-16 Partner 29/04/2015 M.No.202144


Mar 31, 2013

We have audited the accompanying financial statements of EASTERN TREADS LIMITED, which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956. 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 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 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 March 31,2013;

b. In the case of the Profit and Loss Statement, of the profit for the year ended on that date; and

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

1. 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 Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

c. The Balance Sheet, 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 subsection (3C) of section 211 of the Companies Act, 1956;

e. On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of 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.

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of Eastern Treads Limited on the accounts of the Company for the year ended 31st March, 2013.

In terms of Companies (Auditor''s Report) Order 2003, issued by the Government of India, in terms of section 227 (4A) of The Companies Act, 1956, we further report, on the matters specified in paragraph 4 and 5 of the said Order, to the extent applicable to the Company, that:-

1. (i) The Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets, which requires to be updated.

(ii) The fixed assets have been physically verified by the management during the year. We are informed that no serious discrepancies have been noticed by the management on such verification as compared to the aforesaid records of fixed assets.

(iii) During the year, there was no major disposal of fixed assets.

2. (i) The management has carried out physical verification of stocks at reasonable intervals during the year.

(ii) In our opinion, the procedure of verification of stocks followed by the Company are reasonable and adequate having regard to the size of the Company and the nature of its business.

(iii) On the basis of our examination of the records of inventory, we are of the opinion that the Company has a proper system of maintaining records of inventory. We are informed that the discrepancies between the stock records and the physical stocks are not material.

3. (i) The Company has not granted loans to any party covered in the register maintained under Section 301 of The Companies Act, 1956.

(ii) The following are the particulars of loans taken by the Company from companies, firms and other parties covered in the register maintained under Section 301 of The Companies Act, 1956.

Sl. Name of the Party Relationship Loan repaid No. accepted Balance

1 Mr. M. E. Meeran Chairman 0.00 62,43,583.00 0.00

2 Mr. Navas M. Meeran Chairman 0.00 24,41,000.00 0.00

The terms and conditions of the above loans are not prima facie prejudicial to the interests of the Company.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to the purchases of inventory and fixed assets and for the sale of goods and services. There is no continuing failure to correct weaknesses in internal controls.

(i) The particulars of contracts or arrangements referred to Section 301 of the Act have been entered in the register required to be maintained under that Section.

(ii) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Act and exceeding the value of five lakhs rupees 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. The Company has not accepted any deposit from the public.

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 account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of the cost records under section 209(1 )(d) of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

9. (i) According to the records of the Company, the Company has been generally regular in depositing undisputed statutory dues with the appropriate authorities.

(ii) According to the information and explanations given to us, there are no undisputed statutory dues which are outstanding as on 31st March, 2013, for a period of more than six months from the date they became payable.

(iii) According to the records of the Company, there are no statutory dues which have not been deposited on account of any dispute, except the following disputed amounts.

Period to Name of the Nature of Amount (Rs) which the Forum where dispute Statute Dues amount is pending relates

Deputy

CST CST 3,80,200.00 2008-2009 Commissioner (Appeals), Ernakulam

VAT Vehicle 14,400.00 2009-2010 Commercial Tax Officer, Interception Kattappana

10. The accumulated loss of the Company is not more than fifty percent of its net worth. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

11. The Company has not defaulted in repayment of dues to Financial Institutions/Banks.

12. The Company has not granted any loans 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.

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

15. The Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. The Company has not taken any term loans during the year.

17. On the basis of an overall examination of the Balance Sheet of the Company, no funds raised on a short term basis, have been used for long term investments.

18. According to the information and explanations given to us, 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

19. The Company has not issued any debentures during the year.

20. The Company has not raised money by public issues during the year.

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

For JVR & ASSOCIATES Chartered Accountants

(F. R. No. 011121S)

JOMON K. GEORGE Kochi-16

Partner

29-04-2013 M.No.202144


Mar 31, 2012

We have audited the attached Balance Sheet of M/s. EASTERNTREADS LIMITED as at 31st March, 2012 and the Profit and Loss Account and the Cash Flow Statement for the year ended on that date and annexed thereto. These financial statements are the responsibility of the Company's Management.

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements.

An audit includes examining, on 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 management, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

We report as under:

1. 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.

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

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

4. 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.

5. On the basis of written representations received from directors as on 31 st March 2012 and taken on record by the Board, we report that none of the directors are disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of Sub-section (1) of Section 274 of The Companies Act, 1956.

6. 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:-

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

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

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

7. In terms of Companies (Auditor's Report) Order 2003, issued by the Government of India, in terms of Section 227 (4A) of The Companies Act, 1956, we further report, on the matters specified in paragraph 4 and 5 of the said Order, to the extent applicable to the Company, that:-

7.1 The company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

7.2 The fixed assets have been physically verified by the management during the year. We are informed that no serious discrepancies have been noticed by the management on such verification as compared to the aforesaid records of fixed assets.

7.3 During the year, there was no major disposal of fixed assets.

7.4 The management has carried out physical verification of stocks at reasonable intervals during the year.

7.5 In our opinion, the procedure of verification of stocks followed by The Company are reasonable and adequate having regard to the size of the Company and the nature of its business.

7.6 On the basis of our examination of the records of inventory, we are of the opinion that the Company has a proper system of maintaining records of inventory. We are informed that the discrepancies between the stock records and the physical stocks are not material.

7.7 The Company has not granted loans to any party covered in the register maintained under Section 301 of The Companies Act, 1956.

7.8 The following are the particulars of loans taken by the company from companies, firms and other parties covered in the register maintained under Section 301 of The Companies Act, 1956.

SI No Name of the Party Relationship Loan accepted Loan repaid Closing balance

1 Mr. M.E. Meeran Chairman 0.00 0.00 62,43,583.00

2 Mr. Navas M. Meerar Chairman 55,00,000.00 1,30,59,000.00 24,41,000.00

The terms and conditions of the above loans are not prima facie prejudicial to the interests of the Company.

7.9 In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to the purchases of inventory and fixed assets and for the sale of goods and services. There is no continuing failure to correct weaknesses in internal controls.

7.10 The particulars of contracts or arrangements referred to Section 301 of the Act have been entered in the register, required to be maintained under that Section.

7.11 In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act and exceeding the value of five lakhs rupees 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.

7.12 The Company has not accepted any deposit from the public.

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

7.14 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 the cost records under section 209(1 )(d) of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

7.15 According to the records of the Company, the Company has deposited the statutory dues applicable to it with some delays.

7.16 According to the information and explanations given to us, there are no undisputed statutory dues which are outstanding as on 31st March, 2012, for a period of more than six months from the date they became payable.

7.17 According to the records of the Company, there are no statutory dues which have not been deposited on account of any dispute, except the following disputed amounts.

Name of the Nature of Amount (Rs) Period to Forum where dispute is Statute Dues which the pending amount relates

CST CST 3,80,200.00 2008-2009 Deputy Commissioner (Appeals), Ernakulam

VAT Vehicle 14,400.00 2009-2010 Commercial Tax Officer, Interception Kattappana

7.18 The accumulated loss of the Company is not more than fifty percent of its net worth. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

7.19 The Company has not defaulted in repayment of dues to Financial Institutions/Banks.

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

7.21 The Company has not given any guarantee for loans taken by others from banks or financial institutions.

7.22 The Company has not taken any term loans during the year.

7.23 On the basis of an overall examination of the Balance Sheet of the Company, no funds raised on a short term basis, have been used for long term investments.

7.24 The Company has not issued any debentures during the year.

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



For JVR& ASSOCIATES

Chartered Accountants

(F.R.No. 011121S)

Kochi-16 JOMONK. GEORGE

29.05.2012 Partner

M.No. 202144


Mar 31, 2010

We have audited the attached Balance Sheet of M/s. EASTERN TREADS LIMITED as at 31st March, 2010 and the Profit and Loss Account and the Cash Flow Statement for the year ended on that date and annexed thereto. These financial statements are the responsibility of the Companys Management.

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements.

An audit includes examining, on 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 management, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

We report as under:

1. 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.

2. 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 the books.

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

4. 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.

5. On the basis of written representations received from directors as on 31st March 2010 and taken on record by the Board, we report that none of the directors are disqualified as on 31st March, 2010 from being appointed as a director in terms of clause (g) of Sub-Section (1) of Section 274 of The Companies Act, 1956.

6. 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:-

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

ii) in the case of Profit and Loss Account, of the Profit for the year ended on that date; and iii) in the case of the Cash Flow Statement, of the Cash flows for the year ended on that date.

7. In terms of Companies (Auditors Report) Order 2003, issued by the Government of India, in terms of section

227 (4A) of The Companies Act, 1956, we further report, on the matters specified in paragraph 4 and 5 of the

said Order, to the extent applicable to the Company, that:- 7.1 Though the company has maintained records relating to fixed assets, the Company may need to

comprehensively combine/complete the fixed asset register with particulars including quantitative details

and situation of its fixed assets.

7.2 The fixed assets have been physically verified by the management during the year. We are informed that no serious discrepancies have been noticed by the management on such verification as compared to the aforesaid records of fixed assets.

7.3 During the year, there was no major disposal of fixed assets.

7.4 The management has carried out physical verification of stocks at reasonable intervals during the year.

7.5 In our opinion, the procedure of verification of stocks followed by the company requires to be improved considering the size of theCompany and the nature of its business.

7.6 On the basis of our examination of the records of inventory, we are of the opinion that the Company has a proper system of maintaining records of inventory. We are informed that the discrepancies between the stock records and the physical stocks are not material.

7.7 The company has not granted loans to any party covered in the register maintained under Section 301 of The Companies Act, 1956.

7.8 The following are the particulars of loans taken by the Company from companies, firms and other parties covered in the register maintained under Section 301 of The companies Act, 1956.

Sl No. Name of the Party Relationship Loan repaid Closing Balance

1 Mr. M. E. Meeran Chairman 3,174,815.00 7,819,410.00

2 Mr. Navas M. Meeran Director 1,825,185.00 0.00

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

7.9 In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchases of inventory and fixed assets and for the sale of goods and services. There is no continuing failure to correct weaknesses in internal controls.

7.10 The particulars of contracts or arrangements referred to Section 301 of the Act have been entered in the register required to be maintained under that Section.

7.11 In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Act and exceeding the value of five lakhs rupees 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.

7.12 The Company has not accepted any deposit from the public.

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

7.14 To the best of our knowledge, the Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of The Companies Act,1956 for the products of the Company.

7.15 According to the records of the Company, the Company has deposited the statutory dues applicable to it with some delays.

7.16 According to the information and explanations given to us, there are no undisputed statutory dues which are outstanding as on 31st March, 2010, for a period of more than six months from the date they became payable.

7.17 According to the records of the Company, there are no statutory dues which have not been deposited on account of any dispute, except the following disputed amounts, which have been deposited on account of dispute.

Period to which Name of the Nature of Amount (Rs) the amount Statute Dues relates

KGST KGST 1,532,618.00 1996-2002

CST CST 1,904,578.00 1996-2002

Purchase Tax KGST 966,318.00 1996-2002 Interest

CST Interest 180,898.00 2002-2003

CST Annual Dues 175,940.00 2004-2005

Total amount deposited 4,760,352.00



Name of the Statute Forum where dispute is pending

KGST Hon. High Court, Kerala

CST Hon. High Court, Kerala

KG ST Deputy Commissioner (Appeals),Commercial Taxes Department, Ernakulam

CST -do-

CST -do-

7.18 The accumulated loss of the Company is not more than fifty percent of its net worth. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

7.19 The Company has not defaulted in repayment of dues to Financial institutions/Banks.

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

7.21 The Company has not given any guarantee for loans taken by others from Banks or Financial Institutions.

7.22 The Company has not taken any term loans during the year.

7.23 On the basis of an overall examination of the Balance Sheet of the Company, no funds raised on a short term basis, have been used for long term investments.

7.25 The Company has not issued any debentures during the year.

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

For JVR & ASSOCIATES

Chartered Accountants

(F. R. No. 011121S)

JOMON K. GEORGE

PARTNER

M.No.202144

Kochi -

16 11.08.2010

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