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Auditor Report of Hind Rectifiers Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of Hind Rectifiers Limited ("the Company"), 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 of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 (''the Act'') read with General Circular 15/2013 dated 13th September, 2013, issued by the Ministry of Corporate Affairs, in respect of section 133 of the Companies Act, 2013. 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 and other applicable authoritative pronouncements 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, 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 the management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the 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, 2014;

b) In the case of the Statement of Profit and Loss, of the loss 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, as amended by ''the Companies (Auditor''s Report) (Amendment) Order, 2004'', issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, (hereinafter referred to as the ''Order'') and on the basis of checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, 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 and proper returns adequate for the purposes of our audit have been received from 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 Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report, comply with the Accounting Standards notified under the Act read with the General Circular number 15/2013 dated September 13,2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

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 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 Act.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory Requirement" section of our report of even date.)

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

(b) As informed the fixed assets have been physically verified by the management at reasonable intervals; and discrepancies noticed on such verification were not material and the same have been properly dealt with in the books of account;

(c) The disposal of fixed assets during the year cannot be regarded as substantial and do not affect the going concern assumption;

2. (a) As explained to us, Inventories (except stock lying with third parties, for which confirmations obtained in respect of such inventory) have been physically verified during the year by the management;

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

(c) In our opinion, the Company is maintaining proper records of inventory. Discrepancies noticed on physical verification were not material, and the same have been properly dealt with in the books of account;

3. According to information and explanations given to us, the Company has neither granted nor taken loans, secured or unsecured, from parties covered in the register maintained under section 301 of the Act. Therefore, the provisions of clause 4(iii) of the Order, are not applicable to the Company.

4. In our opinion, and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and for sale of goods & services. We have not come across any major weakness in internal control;

5. (a) In our opinion and according to the information and explanations given to us, the particulars 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) According to the information and explanations given to us, there are no transactions of purchase of goods and materials and sale of goods, materials and services exceeding Rs.5,00,000/- during the year in respect of each party made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956;

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA of the Companies Act, 1956, and the rules made thereunder .

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

8. We have broadly reviewed the cost records 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 we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made detailed examination of records with a view to determine whether they are accurate;

9. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including Provident Fund (PF), Investor Education & Protection Fund, Employees'' State Insurance (ESI), Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other statutory dues with the Appropriate Authorities. According to the information and explanation given to us, there are no undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March, 2014 for a period of more than six months from the day they become payable;

(b) The disputed statutory dues aggregating Rs. 119.24 lacs, that have not been deposited on account of disputed matters pending before Appropriate Authorities are as under:

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

Central Excise Excise Duty 79.83 2005-2011 Act (net of advance Appellate Tribunal of Rs.5.44 lacs)

Central Excise Excise Duty 5.02 2010-2013 Act

Central Sales Central Sales Tax 28.90 2006-2007 Tax and and Local Sales (Net advance of and Local Sales Tax Tax Rs. 6.77 lacs) 2008-2009 Act

Cental Sales Tax Cental Sales Tax 5.49 2011-2012 and Local and (Net advance of Sales Tax Act Local Sales Tax Rs. 2.74 lacs)

Name of the Forum where dispute is pending Statute

Central Excise Central Excise and Service Tax Act

Central Excise Departmental Authorities Act

Central Sales Tax and Departmental Authorities Local Sales Tax Act

Cental Sales Tax Sales Tax Appellate Tribunal and Local Sales Tax Act

10. The Company does not have accumulated losses. The Company has incurred cash losses during the financial year covered by our audit but not incurred cash losses in the immediately preceding financial year;

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks;

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Therefore the provision of clause 4(xii) of the order are not applicable to the Company;

13. The provisions of any special statute applicable to Chit Funds, Nidhis or Mutual Benefit Funds / Societies are not applicable to the Company;

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of Clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company;

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions;

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

17. According to the Cash Flow Statement and other records examined by us and on the basis of information and explanations given to us, on and overall basis, funds raised on short term basis have, prima facie, not been used during the year for Long Term Investment;

18. The Company has not made any preferential allotment of shares during the year;

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

20. The Company has not raised any money by way of public issue during the year;

21. As per the information and explanations given to us, no material fraud on or by the Company has been noticed during the year.

For and on behalf of KHANDWALA & SHAH, Chartered Accountants, (Registration No.105069W)

(UDAY J. SHAH) Place: Mumbai Partner Dated: 28th May, 2014 Membership No.033038


Mar 31, 2013

1. We have audited the attached Balance Sheet of HIND RECTIFIERS LIMITED as at 31st March, 2013, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. The financial statements of the branches audited by other Auditors are incorporated in the annexed Balance Sheet and the Statement of Profit and Loss. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor''s Report) Order, 2003, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company, so far as appears from our examination of those books and proper financial statements adequate for the purposes of our audit have been received from the branches not visited by us. The Branch Auditor''s Reports have been forwarded to us and have been appropriately dealt with;

(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 audited financial statements from the Branches;

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss 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 the written representations received from the directors of the company as on March 31, 2013 and taken on record by the Board of Directors, we report that 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) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read with the Significant Accounting Policies and 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 31st March, 2013;

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

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

ANNEXURE TO AUDITORS'' REPORT

(Referred to in paragraph 3 of the Auditors'' Report of even date to the members of Hind Rectifiers Limited on the financial statements for the year ended March 31, 2013)

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

(b) As informed the fixed assets have been physically verified by the management at reasonable intervals; and discrepancies noticed on such verification were not material and the same have been properly dealt with in the books of account;

(c) The disposal of fixed assets during the year cannot be regarded as substantial and do not affect the going concern assumption;

2. (a) As explained to us, Inventories (except stock lying with third parties, for which confirmations obtained in respect of such inventory) have been physically verified during the year by the management;

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

(c) In our opinion, the Company is maintaining proper records of inventory. Discrepancies noticed on physical verification were not material, and the same have been properly dealt with in the books of account;

3. According to information and explanations given to us, the Company has neither granted nor taken loans, secured or unsecured, from parties covered in the register maintained under section 301 of the Act. Therefore, the provisions of clause 4(iii) of the Order, are not applicable to the Company.

4. In our opinion, and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and for sale of goods & services. We have not come across any major weakness in internal control;

5. (a) In our opinion, and according to the information and explanations given to us, the particulars 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) According to the information and explanations given to us, there are no transactions of purchase of goods and materials and sale of goods, materials and services exceeding Rs. 5,00,000/- during the year in respect of each party made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956;

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public. Therefore, the provisions of Clause (vi) of paragraph 4 of the Order are not applicable to the Company.

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

8. According to the information and explanations given to us, the Company is in the process of preparing the Cost Records pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under section 209(1) (d) of the Companies Act, 1956.

9. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including Provident Fund (PF), Investor Education & Protection Fund, Employees'' State Insurance (ESI), Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other statutory dues with the Appropriate Authorities. According to the information and explanation given to us, there are no undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March, 2013 for a period of more than six months from the day they become payable;

(b) The disputed statutory dues aggregating Rs. 113.87 lacs, that have not been deposited on account of disputed matters pending before Appropriate Authorities are as under:

10. The Company does not have accumulated losses. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year;

11. In our opinion, and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks;

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

13. The provisions of any special statute applicable to Chit Funds, Nidhis or Mutual Benefit Funds / Societies are not applicable to the Company;

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of Clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 is not applicable to the Company;

15. In our opinion, and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions;

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

17. According to the Cash Flow Statement and other records examined by us and on the basis of information and explanations given to us, on and overall basis, funds raised on short term basis have, prima facie, not been used during the year for Long Term Investment;

18. The Company has not made any preferential allotment of shares during the year;

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

20. The Company has not raised any money by way of public issue during the year;

21. As per the information and explanations given to us, no material fraud on or by the Company has been noticed during the year.

For and on behalf of

KHANDWALA & SHAH,

Chartered Accountants, (Registration No.105069W)

(UDAY J. SHAH)

Place : Mumbai Partner

Date : 31st May, 2013 Membership No. 033038


Mar 31, 2012

1. We have audited the attached Balance Sheet of HIND RECTIFIERS LIMITED as at 31st March, 2012, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. The financial statements of the branches audited by other Auditors are incorporated in the annexed Balance Sheet and the Statement of Profit and Loss. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company, so far as appears from our examination of those books and proper financial statements adequate for the purposes of our audit have been received from the branches not visited by us. The Branch Auditor's Reports have been forwarded to us and have been appropriately dealt with;

(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 audited financial statements from the Branches;

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss 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 the written representations received from the Directors of the Company as on March 31, 2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2012 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 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 financial statements read with the Significant Accounting Policies and 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 31st March, 2012;

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

and

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

ANNEXURE TO AUDITORS' REPORT

(Referred to in paragraph 3 of the Auditors' Report of even date to the members of Hind Rectifiers Limited on the financial statements for the year ended March 31, 2012)

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

(b) As informed the fixed assets have been physically verified by the management at reasonable intervals; and discrepancies noticed on such verification were not material and the same have been properly dealt with in the books of account;

(c) The disposal of fixed assets during the year cannot be regarded as substantial and do not affect the going concern assumption;

2. (a) As explained to us, Inventories (except stock lying with third parties, for which confirmations obtained in respect of such inventory) have been physically verified during the year by the management;

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

(c) In our opinion, the Company is maintaining proper records of inventory. Discrepancies noticed on physical verification were not material, and the same have been properly dealt with in the books of account;

3. According to information and explanations given to us, the Company has neither granted nor taken loans, secured or unsecured, from parties covered in the register maintained under section 301 of the Act. Therefore, the provisions of clause 4(iii) of the Order, are not applicable to the Company.

4. In our opinion, and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and for sale of goods & services. We have not come across any major weakness in internal control;

5. (a) In our opinion and according to the information and explanations given to us, the particulars 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) According to the information and explanations given to us, there are no transactions of purchase of goods and materials and sale of goods, materials and services exceeding Rs 5,00,000/- during the year in respect of each party made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956;

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA of the Companies Act, 1956, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public.

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

8. According to the information and explanations given to us, the Company is in the process of preparing the Cost Records pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under section 209(1) (d) of the Companies Act, 1956.

9. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including Provident Fund (PF), Investor Education & Protection Fund, Employees' State Insurance (ESI), Income-Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other statutory dues with the Appropriate Authorities. According to the information and explanation given to us, there are no undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March, 2012 for a period of more than six months from the day they become payable;

(b) The disputed statutory dues aggregating Rs 64.90 lacs, that have not been deposited on account of disputed matters pending before Appropriate Authorities are as under:

Forum where dispute is pending Amount (Rs. in lacs)

CEGAT - Central Excise & Gold (Control) 44.45

Appellate Tribunal (Net of Deposit of Rs. 1.00 lac)

Income Tax before the C.I.T. (Appeals) - 22, Mumbai 16.74

Income Tax before the Appellate Tribunal, Mumbai 3.71 (Net of payments and refunds of Rs. 7.15 lacs)

10. The Company does not have accumulated losses. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year;

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks;

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

13. The provisions of any special statute applicable to Chit Funds, Nidhis or Mutual Benefit Funds / Societies are not applicable to the Company;

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of Clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 is not applicable to the Company;

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions;

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

17. According to the Cash Flow Statement and other records examined by us and on the basis of information and explanations given to us, on and overall basis, funds raised on short term basis have, prima facie, not been used during the year for Long Term Investment;

18. The Company has not made any preferential allotment of shares during the year;

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

20. The Company has not raised any money by way of public issue during the year;

21. As per the information and explanations given to us, no material fraud on or by the Company has been noticed during the year except fraud referred to in Note no. (xiv) of other notes on financial statements.

For and on behalf of

KHANDWALA & SHAH,

Chartered Accountants,

(Registration No. 105069W)

(UDAY J. SHAH)

Place : Mumbai Partner

Date : 31st May, 2012 Membership No. 033038


Mar 31, 2011

We have audited the attached Balance Sheet of HIND RECTIFIERS LIMITED as at 31 st March, 2011, the related Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. The returns from the branch audited by other Auditor are incorporated in the annexed Balance Sheet and the Profit and Loss Account. 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. An 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.

As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of "The Companies Act, 1956 of India" (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. Further to our aforesaid comments and our comments in the Annexure referred to above, we report that:

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branch not visited by us. The Branch Auditors Reports have been forwarded to us and have been appropriately dealt with;

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

(d) In our opinion, the Balance Sheet, the 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 the written representations received from the Directors of the Company as on March 31, 2011 and taken on record by the Board of Directors, we report that none of the Directors are disqualified as on March 31, 2011 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 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 Significant Accounting Policies and Notes to 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 Company as at 31st March, 2011;

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

ANNEXURE TO AUDITORS REPORT

(Referred to in paragraph 3 of the Auditors Report of even date to the members of Hind Rectifiers Limited on the financial statements for the year ended March 31, 2011)

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

(b) As informed the fixed assets have been physically verified by the management at reasonable intervals; and discrepancies noticed on such verification were not material and the same have been properly dealt with in the books of account;

(c) The disposal of fixed assets during the year cannot be regarded as substantial and do not affect the going concern assumption;

2. (a) As explained to us, Inventories (except stock lying with third parties, for which confirmations obtained in respect of such inventory) have been physically verified during the year by the management;

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

(c) In our opinion, the Company is maintaining proper records of inventory. Discrepancies noticed on physical verification were not material, and the same have been properly dealt with in the books of account;

3. According to the information and explanation given to us, the Company has neither granted nor taken loans, secured or unsecured from parties covered in the register maintained under section 301 of the Act. Therefore the provisions of clause 4(iii) of the Order are not applicable to the Company;

4. In our opinion, and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and for sale of goods & services. We have not come across any major weakness in internal control;

5. (a) To the best of our knowledge and belief, and according to the information and explanation given to us, the particulars of contracts or arrangements refer to in Section 301 of the Act have been entered in the register maintained under that section;

(b) In our opinion and having regard to our comments in paragraph (iv) above, and according to the information and explanations given to us, transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 have been made at reasonable prices;

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA of the Companies Act, 1956, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public;

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

8. As explained to us maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act;

9. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including Provident Fund (PF), Investor Education & Protection Fund, Employees State Insurance (ESI), Income-Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other statutory dues with the Appropriate Authorities. According to the information and explanation given to us, there are no undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March, 2011 for a period of more than six months from the day they become payable;

(b) The disputed statutory dues aggregating Rs.32.22 lacs, that have not been deposited on account of disputed matters pending before Appropriate Authorities are as under:

Forum where dispute is pending Amount Rs. in lacs

CEGAT - Central Excise & Gold (Control) 13.78

Appellate Tribunal (Net of Deposit of Rs.1.00 lac)

Joint Regional Director, E.S.I. Corporation 14.73

Income Tax before the Appellate Tribunal, Mumbai 3.71

(Net of payments and refunds of Rs.7.15lacs)

10. The Company does not have accumulated losses. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceeding financial year;

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks;

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

13. The provisions of any special statute applicable to Chit Funds, Nidhis or Mutual Benefit Funds / Societies are not applicable to the Company;

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of Clause 4(xiv) of the Companies (Auditors Report) Order, 2003 is not applicable to the Company;

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions;

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

17. According to the Cash Flow Statement and other records examined by us and on the basis of information and explanations given to us, on and overall basis, funds raised on short term basis have, prima facie, not been used during the year for Long Term Investment;

18. The Company has not made any preferential allotment of shares during the year;

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

20. The Company has not raised any money by way of public issue during the year;

21. As per the information and explanations given to us, no material fraud on or by the Company has been noticed during the year.

For and on behalf of

KHANDWALA & SHAH,

Chartered Accountants,

(Registration No.105069W)

(UDAY J. SHAH)

Place : Mumbai Partner

Dated : 30th May, 2011 Membership No.033038










Mar 31, 2010

We have audited the attached Balance Sheet of HIND RECTIFIERS LIMITED as at 31 st March, 2010, the related Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. The returns from the branch audited by other Auditor are incorporated in the annexed Balance Sheet and the Profit and Loss Account. 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. An 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.

As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of "The Companies Act, 1956 of India" (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. Further to our aforesaid comments and our comments in the Annexure referred to above, we report that:

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branch not visited by us. The Branch Auditors Reports have been forwarded to us and have been appropriately dealt with;

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

(d) In our opinion, the Balance Sheet, the 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 the written representations received from the directors of the Company as on March 31, 2010 and taken on record by the Board of Directors, we report that none of the directors are disqualified as on March 31, 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 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 Significant Accounting Policies and Notes to 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 Company as at 31 st March, 2010;

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

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

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS REPORT OF EVEN DATE TO THE MEMBERS OF HIND RECTIFIERS LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2010

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

(b) As informed the fixed assets have been physically verified by the management at reasonable intervals; and discrepancies noticed on such verification were not material and the same have been properly dealt with in the books of account;

(c) The disposal of fixed assets during the year cannot be regarded as substantial and do not affect the going concern assumption;

2. (a) Physical verification of inventory has been conducted at reasonable intervals during the year by the management;

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

(c) In our opinion, the Company is maintaining proper records of inventory. Discrepancies noticed on physical verification were not material, and the same have been properly dealt with in the books of account;

3. (a) According to information and explanations given to us, the Company has, during the year, not granted any loan secured or unsecured to the companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs 4(iii)(a), (b), (c) and (d) of the Order, are not applicable.

(b) During the year, the Company has not taken any unsecured loans from the parties covered in the register maintained under section 301 of the Companies Act, 1956 and the balance outstanding at the year end is Rs.27.39 lacs.

(c) The rate of interest and other terms and conditions of loans taken by the Company are prima facie, not prejudicial to the interest of the Company.

(d) There are no loans repayable during the year and therefore question of overdue amounts does not arise. In respect of interest, there are no overdue amounts.

4.. In our opinion, and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and for sale of goods & services. We have not come across any major weakness in internal control;

5. (a) To the best of our knowledge and belief, and according to the information and explanation given to us, the particulars of contracts or arrangements refer to in Section 301 of the Act have been entered in the register maintained under that section;

(b) In our opinion and having regard to our comments in paragraph (iv) above, and according to the information and explanations given to us, transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 have been made at reasonable prices;

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA of the Companies Act, 1956, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from public.

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

8. As explained to us maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act.

9. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including Provident Fund (PF), Investor Education & Protection Fund, Employees State Insurance (ESI), Income-Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other statutory dues with the Appropriate Authorities. According to the information and explanation given to us, there are no undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March, 2010 for a period of more than six months from the day they become payable;

(b) The disputed statutory dues aggregating Rs. 28.51 lacs, that have not been deposited on account of disputed matters pending before appropriate authorities are as under:

Forum where dispute is pending Amount Rs. in lacs

CEGAT - Central Excise & Gold (Control) Appellate Tribunal 13.78 (Net of Deposit of Rs.1.00 lac)

Joint Regional Director, E.S.I. Corporation 14.73

10. The Company does not have accumulated losses. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceeding financial year;

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks;

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

13. The provisions of any special statute applicable to Chit Funds, Nidhis or Mutual Benefit Funds/ Societies are not applicable to the Company;

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of Clause 4(xiv) of the Companies (Auditors Report) Order, 2003 is not applicable to the Company;

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions;

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

17. According to the Cash Flow Statement and other records examined by us and on the basis of information and explanations given to us, on and overall basis, funds raised on short term basis have, prima facie, not been used during the year for Long Term Investment;

18. The Company has not made any preferential allotment of shares during the year;

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

20. The Company has not raised any money by way of public issue during the year;

21. As per the information and explanations given to us, no material fraud on or by the Company has been noticed during the year.

For and on behalf of KHANDWALA & SHAH,

Chartered Accountants, Registration No. 105069W

(UDAY J. SHAH)

Partner Membership No.033038

Place: Mumbai.

Date: 28th May, 2010

 
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