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Auditor Report of Fairdeal Filaments Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Fairdeal Filaments 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 for the year then ended.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone 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 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 issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

Opinion

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

Emphasis of Matters

We draw attention to the following matters in the Notes to the financial statements:

a. Note No. 16.1 to the financial statements which states that the company has discontinued accounting for further accrual of interest subsidy claim under TUF, following conservatism.

b. Note No. 24 to the financial statements which shows the amount of Rs. 51.44 lacs written off during the year as bad debts under 'Selling & Distribution Expenses' includes the amount of Rs.30.77 lacs relating to foreign debtors.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

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

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

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

i. The Company does not have any pending litigations which would impact its financial position.

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

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

The Annexure referred to in our Independent Auditors' Report to the members of the Company on the standalone financial statements for the year ended 31 March 2015, we report that:

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

(b) We are informed that the physical verification of the fixed assets has been carried out by the management at reasonable intervals and no material discrepancies were noticed on such physical verification;

(ii) (a) The inventories have been physically verified by the management during the year. 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 the nature of its business;

(c) The Company has maintained proper records of inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

(iii) As per the information and explanations given to us and the records produced before us for our verification, the Company has not granted secured or unsecured loan to companies, firms or other parties listed in the register maintained under section 189 of the Companies Act, 2013. Accordingly, paragraph (iii) (a) and (b) of the Order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regards to the purchases of inventory and fixed assets and also for the sale of goods and services. During the course of our audit, we have not come across any major weaknesses in the internal control system of the Company.

(v) In our opinion and according to the information given to us, the Company has not accepted any deposits from the public, which come under the directives issued by the Reserve Bank of India and the provisions of Section 73 to 76 or any other relevant provisions of the Companies Act and Rules framed there under.

(vi) We have broadly reviewed the books of account and records maintained by the Company pursuant to the rules made by the Central Government for the maintenance of Cost Records under Section 148(1) of the Companies Act, 2013, and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records with a view to determine whether they are accurate.

(vii) (a) According to the information and explanations given to us and the records examined by us, the Company has generally been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales tax, value added tax, wealth tax, customs duty, excise duty, service tax, cess and any other statutory dues wherever applicable. There are no arrears of statutory dues as at March 31,2015 which are outstanding for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Income Tax or Sales Tax or Wealth Tax or Service Tax or duty of Customs or duty of excise or value added tax or cess wherever applicable on account of any dispute.

(c) In our opinion and according to the information and explanations given to us and according to records of the Company, during the year, the amount required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund within time.

(viii) The Company does not have any accumulated losses at the end of the financial year March 31, 2015. Further, the Company has not incurred cash losses during the financial year ended March, 31, 2015 and in the immediately preceding financial year.

(ix) On the basis of the records examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to banks and financial institutions. The Company has not issued debentures during the year.

(x) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) In our opinion and according to the information and explanations given to us, no additional term loans availed by the Company during the year.

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

For, NATVARLALVEPARI & CO.

CHARTERED ACCOUNTANTS

Firm Reg. No. 123626W

Ravindra Vepari

Place : Surat Partner

Date : 29th May, 2015 Membership No. : 006728


Mar 31, 2014

We have audited the accompanying financial statements of Fairdeal Filaments Limited, which comprise the Balance Sheet as at March 31,2014, 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 ofthe financial position, financial performance and cash flows ofthe Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 ofthe 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 ofthe accounting estimates made by management, as well as evaluating the overall presentation ofthe 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 Profit and Loss Account, the profit for the year ended on that date;

b) in the case ofthe Balance Sheet, ofthe state of affairs ofthe Company as at March 31,2014; 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 ofthe 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 ofthe Companies Act, 1956;

e. 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 ofthe 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 ofthe CompaniesAct, 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.

ANNEXURE TO THE AUDITOR''S REPORT

(Statement referred to in Paragraph 3 of the Auditors'' Report of even date to the Members of Fairdeal Filaments Limited Surat, on the Accounts for the year ended March 31, 2014)

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

(b) We are informed that the physical verification of the fixed assets has been carried out by the management at reasonable intervals and no material discrepancies were noticed on such physical verification;

(c) In our opinion and according to the information and explanations given to us, the Company has not disposed off a substantial part of its fixed assets during the year that would affect the going concern status of the Company.

(ii) (a) The inventories have been physically verified by the management during the year. 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 the nature of its business;

(c) The Company has maintained proper records of inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

(iii) As per the information and explanations given to us and the records produced to us for our verification, The Company has not taken or granted secured or unsecured loan from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraph 4(iii) (e), (f) and (g) of the Order, are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regards to the purchases of inventory and fixed assets and also for the sale of goods and services. During the course of our audit, we have not come across any majorweaknesses in the internal control system ofthe Company.

(v) (a) 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 made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant times.

(vi) The Company has not accepted deposits from the public within the meaning of Sections 58A, 58AA of the Companies Act, 1956 and the Rules framed there-under. Therefore, the provisions of Clause 4(vi) of the Order are not applicable.

(vii) On the basis of the internal audit report broadly reviewed by us, we are of the opinion that, the Company has an internal audit system commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account and records maintained by the Company pursuant to the rules made by the Central Government for the maintenance of 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. We have, however, not made a detailed examination ofthe records with a view to determine whether they are accurate.

(ix) According to the information and explanations given to us and the records ofthe Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-Tax, Sales-Tax, VAT, Wealth-Tax, Service-Tax, Customs Duty, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities. According to the information and explanation given to us, no disputed amounts payable, in respect of income tax, sales tax, custom duty, excise duty and cess, were in arrears, as at March 31,2014 for a period for more than six months from the date they become payable.

(x) The Company does not have any accumulated losses at the end of the financial year March 31,2014. Further, the Company has not incurred cash losses during the financial year ended March, 31,2014 and in the immediately preceding financial year.

(xi) On the basis of the records examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to banks and financial institutions. The Company has not issued debentures during the year.

(xii) According to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security byway of pledge of shares, debentures and other securities, accordingly paragraph 4(xii)of the Order is not applicable.

(xiii) According to the information and explanations given to us, the Company is not a chit fund ora nidhi/ mutual benefit fund/ society, accordingly paragraph 4 (xiii) ofthe Order is not applicable.

(xiv) According to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments, accordingly paragraph 4(xiv) of the Order is not applicable.

(xv) According to the information and explanations given by the management, no guarantee has been given by the Company during the year.

(xvi) In our opinion and according to the information and explanations given to us, no additional term loans availed by the Company during the year.

(xvii) As per the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the funds relating to long term basis to short term basis and as explained they have been deployed to fund core working capital.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the Register maintained undersection 301 ofthe Companies Act, 1956.

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

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

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

Forming an Opinion and Reporting on Financial Statements

For NATVARLAL VEPARI & CO. CHARTERED ACCOUNTANTS Firm Reg. No. 123626W

Ravindra Vepari

Place : Surat Partner Date : 28th May, 2014 Membership No. : 006728


Mar 31, 2010

We have audited the attached Balance Sheet of FAIRDEAL FILAMENTS LIMITED, as at 31 st March 2010, the Profit and Loss Account and Cash Flow Statement of the Company for the year ended on that date, 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosure in the financial statements. An audit also includes assessing the accounting principle 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.

1. As required by the Companies (Auditors Report) Order, 2003 (as amended), issued by the Department of Company Law Affairs in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we annex hereto Annexure A onihe matters specified in paragraph 4 and 5 of the said order.

Further to our comments in Annexure referred to in Para (1) above, we report that:

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

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

(c) The Balance Sheet, Profit and Loss Account and cash flow statement dealt with by this report are in agreement with the books of account.

(d) In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

(e) On the basis of written representation received from the directors, as on 31st March 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 st 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.

2. Subject to the matters referred to above, 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 thereon, 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 at 31 st March, 2010;

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

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

ANNEXURE A TO THE AUDITORS REPORT : YEAR ENDED 31-3-2010

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

b) We are informed that all fixed assets have been physically verified by the management at reasonable intervals. On the basis of information and explanations given to us, no material discrepancies were noticed on such verification.

c) The Company has not disposed off any substantial part of its fixed assets so as to affect its going concern status.

2) a) As informed to us, the inventory has been physically verified during the year by the management at reasonable intervals. In our opinion, the frequency of verification is reasonable.

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

c) The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stock and the books records were not material and have been properly dealt with in the books of accounts.

3) The Company has not taken or granted any loans, secured or unsecured from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act ,1956

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

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

b) In our opinion and according to the information and explanation given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. five lakhs in respect of any party during the year have been made at prices which are reasonable and having regard to prevailing market prices at the relevant time.

6) The Company has not accepted deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956, and the rules made there under.

7) We are of the opinion that, the coverage of internal audit functions carried out by a Chartered Accountant appointed by the management is commensurate with the size of the company and the nature of its business.

8) We have broadly reviewed the books of accounts maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 in respect of the companys products to which the said rules are made applicable, and are of the opinion that, the prescribed accounts and records have been made and maintained.

9) a) According to the records of the company wherever applicable, it has been regular in depositing undisputed statutory dues including provident fund, investor education protection fund, employees state insurance, income tax, Value Added Tax sales tax / VAT, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues applicable to it with the appropriate authorities.

b) According to the information and explanation given to us, no disputed amounts payable in respect of income tax, wealth tax, sales tax, custom duty, excise duty and cess were in arrears, as at 31st March 2010 for a period for more than six months from the date they became payable.

10) The Company has neither accumulated losses at the end of the financial year nor has it incurred cash losses, both, in the financial year under report and the immediately preceding financial year.

11) According to the information and explanation given to us, the company has not defaulted in repayments of dues to financial institutions or bank or debenture holders.

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

13) According to the information and explanation given by the management, in our opinion the terms and conditions of the guarantee given by the Company for loan taken by others from Bank are not prejudicial to the interest of the company.

14) In our opinion, the term loans have been applied for the purpose for which they were raised.

15) According to information and explanation given to us and on an overall examination of the balance sheet of the company, we report that the company has used funds relating to long term basis to short term basis and as explained they have been deployed to fund core working capital.

16) 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.

17) The company has not issued any debentures during the year.

18) During the year covered by our audit report, the company has not issued any shares to public.

19) According to the information and explanation given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

20) Considering the nature of activities being carried out, by the company and also the nature of the matters referred to in the various clauses of the Companies (Auditors Report) Order, 2003, Clause (xiii) and (xiv) of paragraph 4 of the aforesaid order is not applicable to the Company.

For, NATVARLAL VEPARI & CO.

CHARTERED ACCOUNTANTS Firm Reg. No. 123626W

Ravindra Vepari Place: Surat Partner

Date : 27.05.2010 Membership No.: 6728



 
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