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Auditor Report of Emami Paper Mills Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of Emami Paper Mills Limited ("the company") which comprises the balance sheet as at 31st March 2014, and the Statement of Profit & Loss and the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the accounts of Gulmohar unit audited by Branch Auditors, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 ("the Forming an Opinion and Reporting on Financial Statements Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITOR''S RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of 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, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

OPINION

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

i) In the case of the Balance Sheet, of the State of Affairs of the Company as at 31st March, 2014;

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

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

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") 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 further report that :

a) the report on the accounts of Gulmohar Unit audited by Branch Auditors have been received and properly dealt with in preparing our Report;

b) 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;

c) 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;

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

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

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

Annexure to the Independent Auditors'' Report

In our opinion and according to the information and explanations given to us, the nature of the Company''s business/activities during the year are such that clauses (xiii) and (xix) of Companies (Auditor''s Report) Order, 2003, are not applicable to the Company. In respect of the other clauses, we report as under :

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

b. The fixed assets were physically verified during the year by the management in accordance with a program of verification, covering all fixed assets over a period of three years, which in our opinion provides for physical verification of all major items of fixed assets at reasonable intervals.

c. Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.

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

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

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

3. a. The Company has given unsecured loan to two companies listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount outstanding during the year was Rs 4,333.56 Lacs (P.Y. - Rs 334.42 Lacs) and the year end balance of such loan amounted to Rs 334.42 lacs (P.Y. - Rs 334.42 Lacs). The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise.

b. The Company has taken unsecured loan from a company listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount payable during the year was Rs 1.42 Lacs (P.Y. - Rs 4,699.53 Lacs) and the year end balance of such loan amounted to Rs Nil. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise.

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 for the purchase of inventory and fixed assets and for the sale of goods.

5. In respect of contracts or arrangements referred in Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the Register maintained under Section 301 of the Companies Act, 1956, have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions referred to above and exceeding the value of Rs 5 Lacs with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices.

6. The Company has not accepted any deposits from the public during the year.

7. In our opinion, the Company has an adequate 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 prescribed by the Central Government under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for the maintenance of cost records and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. According to the information and explanations given to us in respect of statutory and other dues:

a. The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Service Tax, Sales Tax, VAT, Wealth Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2014 for a period of more than six months from the date of becoming payable.

b. According to the information and explanations given to us, details of dues of Excise Duty, Sales Taxes and Employees State Insurance which have not been deposited as on 31st March, 2014 on account of dispute are given below :

Particular Financial Year Forum where Amount to which the matter is (Rs in Lacs) matter pertains pending

The Central Excise Act, 1994 & Service Tax 2006-07 TRIBUNAL 74.81 (Finance Act, 1994) 2005-06 TO 2007-08 TRIBUNAL 35.24 2007-08 TRIBUNAL 0.10 Central Sales Tax Act 1993-94 TRIBUNAL 16.26 2004-05 TRIBUNAL 0.53 2006-07 TRIBUNAL 3.83 2007-08 ADDL. COMM. 3.37 2008-09 ADDL. COMM. 26.25 2009-10 ADDL. COMM. 17.11 2010-11 ADDL. COMM. 8.04 Values Added Tax Act (Orissa) 2006-07 ADDL. COMM. 0.59 2009-10 ADDL. COMM 10.88 2010-11 ADDL. COMM 25.48 Entry Tax Act (Orissa)* 2006-07 ADDL. COMM. & SELF ASSESSMENT 1.30 2007-08 ADDL. COMM. & SELF ASSESSMENT 0.11 2008-09 ADDL. COMM. & SELF ASSESSMENT 51.96

Entry Tax Act (Orissa)* 2009-10 ADDL. COMM. & SELF ASSESSMENT 39.71 2010-11 ADDL. COMM. & SELF ASSESSMENT 52.98 2011-12 ADDL. COMM. & SELF ASSESSMENT 65.31 2012-13 ADDL. COMM. & SELF ASSESSMENT 22.08 2013-14 ADDL. COMM. & SELF ASSESSMENT 36.75 Entry Tax Act (West Bengal) 2013-14 HIGH COURT 49.12 Odisha Sales Tax Act 1989-90 HIGH COURT 0.79 ESIC 1996-97 ESI COURT 0.22

* Question of Law regarding chargeability of entry tax on inter state purchase of goods & import of goods from outside of India is pending before Hon''ble Supreme Court of India.

10. The Company does not have accumulated losses as at the end of the year and the Company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institution and banks.

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

13. According to the information & explanations given to us, the Company is not dealing in shares, securities, debentures and other investment.

14. According to information given to us, the Company has not given any guarantee for loans taken by others from banks or financial institution.

15. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the company were applied for the purpose for which the loans were obtained.

16. According to the Cash Flow Statement and other records examined by us and the information and explanations given to us on an overall basis, we report that funds raised on short term basis have, prima facie, not been used for long term investments.

17. The Company has made preferential allotment of Preference Shares to parties and companies covered in the Register maintained under section 301 of the Companies Act 1956, during the year and the price at which shares have been issued is not prejudicial to the interest of the Company.

18. The Company has not raised money by public issues during the year and hence the question of disclosure and verification of end use of such money does not arise.

19. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For S. K. AGRAWAL & COMPANY Chartered Accountants Registration No. 306033E

S. K. Agrawal Place : Kolkata Partner Dated : 25th April, 2014 Membership No. 9067


Mar 31, 2013

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of Emami Paper Mills Limited ("the company") which comprises the Balance Sheet as at 31st March 2013, and the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the accounts of Gulmohar unit audited by Branch Auditors, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Forming an Opinion and Reporting on Financial Statements Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITOR''S RESPONSIBILITY

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

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

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

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

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") 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 further report that:

a) the report on the accounts of Gulmohar Unit audited by Branch Auditors have been received and properly dealt with in preparing our Report.

b) 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;

c) 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.

d) 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;

e) 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;

f) 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.

In our opinion and according to the information and explanations given to us, the nature of the Company''s business/ activities during the year are such that clauses (xiii) and (xix) of Companies (Auditor''s Report) Order, 2003, are not applicable to the Company. In respect of the other clauses, we report as under:

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

b. The fixed assets were physically verified during the year by the management in accordance with a program of verification, covering all fixed assets over a period of three years, which in our opinion provides for physical verification of all major items of fixed assets at reasonable intervals.

c. Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.

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

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

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

3. a. The Company has given unsecured loan to a company listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount outstanding during the year was Rs 334.42 lacs and the year end balance of such loan amounted to Rs. 334.42 lacs. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise.

b. The Company has taken unsecured loan from a company listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount payable during the year was Rs 4699.53 lacs and the year end balance of such loan amounted to Rs. Nil. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise.

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 for the purchase of inventory and fixed assets and for the sale of goods.

5. In respect of contracts or arrangements referred in Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the Register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions referred to above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices.

6. The Company has not accepted any deposits from the public during the year.

7. In our opinion, the Company has an adequate 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 prescribed by the Central Government under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for the maintenance of cost records and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. According to the information and explanations given to us in respect of statutory and other dues:

a. The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Service Tax, Sales Tax, VAT, Wealth Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2013 for a period of more than six months from the date of becoming payable.

b. According to the information and explanations given to us, details of dues of Excise Duty, Sales Taxes and Employees State Insurance which have not been deposited as on 31st March, 2013 on account of dispute are given below:

Particular Financial Year to which Forum where matter is Amount (Rs. in Lacs) the matter pertains pending

The Central Excise Act, 1944 & 1994-95 ACCE 0.87 Service Tax (Finance Act, 1994) 2002-03 to 2006-07 ACCE 1.10

2006-07 ACCE 72.65

2005-06 to 2007-08 ACCE 35.28

Central Sales Tax Act 1993-94 Tribunal 16.26

2004-05 Tribunal 0.53

2006-07 Addl. Comm. 0.79

2007-08 Addl. Comm. 3.37

2008-09 Addl. Comm. 26.25

Values Added Tax Act (Orissa) 2005-06 Addl. Comm. 1.68

2006-07 Addl. Comm. 0.59

2007-08 Addl. Comm 0.79

2009-10 Addl. Comm 0.10

Entry Tax Act (Orissa) 2006-07 Addl. Comm. 1.30

2007-08 Addl. Comm. 0.11

2008-09 Addl. Comm. 32.00

2006-07 to 2007-08 Addl. Comm. 69.60

Odisha Sales Tax Act 1989-90 High Court 0.79

ESIC 1996-97 ESI Court 0.22

Income Tax Act 1961 2011-12 Comm. Appeals 29.53

10. The Company does not have accumulated losses as at the end of the year and the Company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that the company has not defaulted in the repayment of dues to financial institution and banks.

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

13. According to the information & explanations given to us, the Company is not dealing in shares, securities debentures and other investment.

14. According to information given to us, the Company has not given any guarantee for loans taken by others from banks or financial institution.

15. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the company were applied for the purpose for which the loans were obtained.

16. According to the Cash Flow Statement and other records examined by us and the information and explanations given to us on an overall basis, we report that funds raised on short term basis have, prima facie, not been used for long term investments.

17. The Company has made preferential allotment of Preference Shares to parties and companies covered in the Register maintained under section 301 of the Companies Act 1956, during the year and the price at which shares have been issued is not prejudicial to the interest of the Company.

18. The Company has not raised money by public issues during the year and hence the question of disclosure and verification of end use of such money does not arise.

19. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For, S. K. AGRAWAL & COMPANY

Chartered Accountants

Registration No- 306033E

(S. K. AGRAWAL)

Place: Kolkata Partner

Dated: 30th April, 2013 Membership No: 9067


Mar 31, 2012

We have audited the attached Balance Sheet of Emami Paper Mills Limited as at 31st March 2012, the Statement of Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the accounts of Gulmohar unit audited by Branch Auditors. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

We further report that:

a) The Report on the accounts of Gulmohar Unit audited by Branch Auditors have been received and properly dealt with in preparing our Report.

b) 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.

c) 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 such books.

d) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement referred to in this report are in agreement with the books of accounts and comply with the accounting standards referred to in Section 211(3C) of the Companies Act, 1956 to the extent applicable.

e) On the basis of written representations received and taken on record by the Board of Directors, we report that none of the Directors are disqualified as on 31st March, 2012 from being appointed as a Director in terms of Section 274 (1) (g) of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said ac- counts read with the notes on 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 the Balance Sheet, of the State of Affairs of the Company as on 31st March, 2012

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

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

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

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

b. The fixed assets were physically verified during the year by the management in accordance with a pro- gram of verification, covering all fixed assets over a period of three years, which in our opinion provides for physical verification of all major items of fixed assets at reasonable intervals.

c. Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.

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

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

c. I n our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventory and no material discrepancies were noticed on physical verification.

3. a. The Company has given unsecured loan to a company listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount outstanding during the year was Rs 303.21 lacs and the year end balance of such loan amounted to Rs.303.21 lacs. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise.

b. The Company has taken unsecured loan from a company listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount payable during the year was Rs 4151.70 lacs and the year end balance of such loan amounted to Rs.4151.70. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The company is regular in payment of interest and principal.

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 for the purchase of inventory and fixed assets and for the sale of goods.

5. In respect of contracts or arrangements referred in Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the Register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions referred to above and exceeding the value of Rs.5 lacs with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices.

6. The Company has not accepted any deposits from the public during the year.

7. In our opinion, the Company has an adequate 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 prescribed by the Central Government under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for the maintenance of cost records and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. According to the information and explanations given to us in respect of statutory and other dues:

a. The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Service Tax, Sales Tax, VAT, Wealth Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2012 for a period of more than six months from the date of becoming payable.

b. According to the information and explanations given to us, details of dues of Excise Duty, Sales Taxes and Employees State Insurance which have not been deposited as on 31st March, 2012 on account of dispute are given below:

Particular Financial Year to which Forum where matter is Amount (Rs. in Lacs) the matter pertains pending

Excise Duty 1994-95 ACCE 0.87

2002-03 to 2006-07 ACCE 1.10

2006-07 ACCE 72.65

2005-06 to 2007-08 ACCE 35.28

CST 1993-94 Tribunal 16.26

2004-05 Tribunal 0.53

2004-05 Addl. Comm. 0.68

2006-07 Addl. Comm. 0.79

2007-08 Addl. Comm. 3.37

2008-09 Addl. Comm. 26.25

VAT (Orissa) 2005-06 Addl. Comm. 1.68

2006-07 Addl. Comm. 0.59

2007-08 Addl. Comm. 0.79

Entry Tax (Orissa) 2006-07 Addl. Comm. 1.30

2007-08 Addl. Comm. 0.11

2008-09 Addl. Comm. 32.00

OST 1989-90 High Court 0.79

ESIC 1996-97 ESI Court 0.22

10. The Company does not have accumulated losses as at the end of the year and the Company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that the company has not defaulted in the repayment of dues to financial institution and banks.

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

13. According to the information & explanations given to us, the Company is not dealing in shares, securities debentures and other investment.

14. According to information given to us, the Company has not given any guarantee for loans taken by others from banks or financial institution.

15. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the company were applied for the purpose for which the loans were obtained.

16. According to the Cash Flow Statement and other records examined by us and the information and explanations given to us on an overall basis, we report that funds raised on short term basis have, prima facie, not been used for long term investments.

17. 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, during the year and hence the question of whether the price at which shares have been issued is prejudicial to the interest of the Company does not arise.

18. The Company has not raised money by public issues during the year and hence the question of disclosure and verification of end use of such money does not arise.

19. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.



For S. K. Agrawal & Co.

Chartered Accountants

Registration No- 306033E

S. K. Agrawal

Place: Kolkata Partner

Dated: 17th May, 2012 Membership No: 9067


Mar 31, 2011

We have audited the attached Balance Sheet of Emami Paper Mills Limited as at 31st March 2011, the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the accounts of Gulmohar unit audited by Branch Auditors. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financia statement presentation. We believe that our audit provides a reasonable basis for our opinion

We further report that:

a) The Report on the accounts of Gulmohar Unit audited by Branch Auditors have been received and properly dealt with in preparing our Report.

b) 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.

c) 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 such books

d) The Balance Sheet, the Profit & Loss Account & the Cash Flow Statement referred to in this report are in agreement with the books of accounts and comply with the accounting standards referred to in Section 211(3C) of the Companies Act, 1956 to the extent applicable.

e) On the basis of written representations received from the Directors and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the notes on accounts as per Schedule 17 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 the Balance Sheet, of the State of Affairs of the Company as on 31st March, 2011

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

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

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

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

b. The fixed assets were physically verified during the year by the management in accordance with a program of verification, covering all fixed assets over a period of three years, which in our opinion provides for physical verification of all major items of fixed assets at reasonable intervals

c. Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption

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

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

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

3. a. The Company has given unsecured loan to a company

isted in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount outstanding during the year was Rs. 308.72 acs and the year end balance of such loan amounted to Rs. 308.72 lacs. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise

b. The Company has not taken any loans, secured or unsecured, from companies listed in the register maintained under Section 301 of the Companies Act, 1956

4. In our opinion and according to the information and explanations given to us, there are adequate interna control systems commensurate with the size of the Company and the nature of its business for the purchase of nventory and fixed assets and for the sale of goods

5. In respect of contracts or arrangements referred in Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the Register maintained under section 301 of the Companies Act, 1956 have been so entered

b. In our opinion and according to the information and explanations given to us, the transactions referred to above and exceeding the value of Rs. 5 lacs with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices

6. The Company has not accepted any deposits from the public during the year.

7. In our opinion, the Company has an adequate 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 prescribed by the Central Government under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for the maintenance of cost records and are of the opinion that prima facie the prescribed accounts and records have been made and maintained

9. According to the information and explanations given to us in respect of statutory and other dues:

a. The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Service Tax, Sales Tax, VAT, Wealth Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities during the year. According to the nformation and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2011 for a period of more than six months from the date of becoming payable

b. According to the information and explanations given to us, details of dues of Excise Duty, Sales Taxes and Employees State Insurance which have not been deposited as on 31st March, 2011 on account of dispute are given below:

Particular Financial Year Forum where Amount

to which the matter is (Rs. in lacs)

matter pertains pending

Excise 1994-95 ACCE 0.87

Duty 2002-03 to 2006-07 ACCE 1.10

CST 1993-94 Tribunal 16.26

2004-05 Tribunal 0.53

2006-07 Addl. Comm. 3.83

2007-08 Addl. Comm. 3.37

VAT 2005-06 Addl. Comm. 1.68

(Orissa) 2006-07 Addl. Comm. 0.59

2007-08 Addl. Comm. 0.79

Entry Tax 2006-07 Addl. Comm. 1.30

(Orissa) 2007-08 Addl. Comm. 0.11

OST 1989-90 High Court 0.79

ESIC 1996-97 ESI Court 0.22

10. The Company does not have accumulated losses as at the end of the year and the Company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. Based on our audit procedures and on the basis of nformation and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institutions and banks

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

13. According to the information & explanations given to us, the Company is not dealing in shares, securities, debentures and other investments.

14. According to information given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions

15. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the company were applied for the purpose for which the loans were obtained

16. According to the Cash Flow Statement and other records examined by us and the information and explanations given to us on an overall basis, we report that funds raised on short term basis have, prima facie, not been used for long term investments

17. 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, during the year and hence the question of whether the price at which shares have been issued is prejudicial to the nterest of the Company does not arise

18. The Company has not raised money by public issues during the year and hence the question of disclosure and verification of end use of such money does not arise

19. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For S. K. Agrawal & Company

Chartered Accountants

Registration No. 306033E

S. K. Agrawal

Place : Kolkata Partner

Dated : 30th May 2011 Membership No. 9067




Mar 31, 2010

We have audited the attached Balance Sheet of Emami Paper Mills Limited as at 31st March 2010, the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the accounts of Gulmohar unit audited by Branch Auditors. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

We further report that:

a) The Report on the accounts of Gulmohar Unit audited by Branch Auditors have been received and properly dealt with in preparing our Report.

b) 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.

c) 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 such books.

d) The Balance Sheet, the Profit & Loss Account & the Cash Flow Statement referred to in this report are in agreement with the books of accounts and comply with the accounting standards referred to in Section 21 1 (3C) of the Companies Act, 1956 to the extent applicable.

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the notes on accounts as per Schedule 17 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 the Balance Sheet, of the State of Affairs of the Company as on 31 st March, 2010; ii) In the case of the Profit & 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.

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

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

b. The fixed assets were physically verified during the year by the management in accordance with a program of verification, covering all fixed assets over a period of three years, which in our opinion provides for physical verification of all major items of fixed assets at reasonable intervals.

c. Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.

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

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

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

3. a. The Company has given unsecured loan to a company listed in the register maintained under Section 301 of the Companies Act, 1956 against whom the maximum amount outstanding during the year was Rs 272 lacs and the year end balance of such loan amounted to Rs. 272 lacs. The rate of interest and other terms and conditions of the loan are not prima facie prejudicial to the interest of the Company. The principal amounts and interest are repayable on demand, therefore the question of overdue amounts does not arise.

b. The Company has not taken any loans, secured or unsecured, from companies listed* in the register maintained under Section 301 of the Companies Act, 1956.

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 for the purchase of inventory and fixed assets and for the sale of goods.

5. In respect of contracts or arrangements referred in Section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the Register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions referred to above and exceeding the value of Rs. 5 lacs with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices.

6. The Company has not accepted any deposits from the public during the year.

7. In our opinion, the Company has an adequate 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 prescribed by the Central Government under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for the maintenance of cost records and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. According to the information and explanations given to us in respect of statutory and other dues:

a. The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Service Tax, Sales Tax, VAT, Wealth Tax, Custom Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31 st March, 2010 for a period of more than six months from the date of becoming payable.

b. According to the information and explanations given to us, details of dues of Excise Duty, Sales Taxes and Employees State Insurance which have not been deposited as on 31st March, 2010 on account of dispute are given below:

Particular Financial Year to which Forum where matter Amount (Rs. in Lacs) the matter pertains is pending

Excise Duty 1994-95 ACCE 0.87

2004-05 0.09

CST 1993-94 Tribunal 16.26

2004-05 Tribunal 0.53

2005-06 Addl. Comm. 238.52

2006-07 Addl. Comm. 3.83

2007-08 Addl. Comm. 4.06

VAT(Orissa) 2005-06 Addl. Comm. 1.68

2006-07 Addl. Comm. 0.59

2007-08 Addl. Comm 0.79

Entry Tax (Orissa) 2006-07 Addl. Comm. 1.30

2007-08 Addl. Comm. 0.11

OST 1989-90 High Court 0.79

ESIC 1996-97 ESICourt 0.22

10. The Company does not have accumulated losses as at the end of the year and the Company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institution and banks.

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

13. According to the information & explanations given to us, the Company is not dealing in shares, securities debentures and other investment.

14. According to information given to us, the Company has not given any guarantee for loans taken by others from banks or financial institution.

15. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the company were applied for the purpose for which the loans were obtained.

16. According to the Cash Flow Statement and other records examined by us and the information and explanations given to us on an overall basis, we report that funds raised on short term basis have, prima facie, not been used for long term investments.

17. 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, during the year and hence the question of whether the price at which shares have been issued is prejudicial to the interest of the Company does not arise.

18. The Company has not raised money by public issues during the year and hence the question of disclosure and verification of end use of such money does not arise.

19. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For S. K. AGRAWAL & COMPANY

Chartered Accountants Registration No- 306033E S. K. AGRAWAL

Partner

Membership No: 9067

Place: Kolkata

Dated: May 05, 2010



 
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