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Auditor Report of Hindustan Foods Ltd.

Mar 31, 2015

We have audited the attached Balance Sheet of M/s. Hindustan Foods Limited ('the Company'), which comprise the Balance Sheet as at 31st March 2015, the Statement of Profit and Loss and the Cash Flow Statement for the then year ended, and a summary of the significant accounting policies and other explanatory information.

2. Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters in section 134(5) of the Companies Act, 2013 (the Act) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 internal financial control, 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.

3. 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 thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and 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 true and fair view 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 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.

4. Opinion

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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2015;

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

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

5. Report on Other Legal and Regulatory Requirements

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 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 7 of the Companies (Accounts) Rules, 2014.

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

f) With respect to the other matters included in the Auditor's Report and to our 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 derivatives contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE TO AUDITOR'S REPORT

On the basis of the records produced to us for our verification / perusal, such checks as we considered appropriate and in terms of information and explanation given to us on our enquiries, we state that:

1) In respect of fixed assets :

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

b) The fixed assets have been physically verified by the management during the year in accordance with the regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.

2) In respect of inventories :

a) As explained to us, the stock of inventory has been physically verified by the management at the close of the year.

b) In our opinion, the procedures followed by the management for physical verification of inventories are reasonable and adequate in relation to the size of the Company and the nature of business.

c) The Company has maintained proper records of inventories. As explained to us, the discrepancies noticed between physical verification of stocks and book records were not material, and the same have been properly dealt with in the books of account.

3) The Company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013 and therefore the provisions of this clause of the Companies (Auditors Report) Order, 2015 is not applicable.

4) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods. During the course of our audit, no major weaknesses have been observed in the internal controls.

5) The Company has not accepted any deposits from the public requiring compliance of Section 73 to 76 of the Companies Act, 2013 and the rules framed there under.

6) We were informed that the Central Government has not prescribed the maintenance of cost records under sub section (1) of Section 148 of the Companies Act, 2013, in respect of the activities carried on by the Company.

7) In respect of statutory dues.

a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees' state insurance, sales tax, custom duty, excise duty, cess, service tax and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of sales tax, custom duty, excise duty, service tax and cess were in arrears, as at 31st March, 2015 for a period of more than six months from the date they became payable.

c) According to the information and explanations given to us, there are no dues of sales tax, custom duty, excise duty, service tax and cess, which have not been deposited on account of any dispute, except for the following :

Year Details Amount (Rs.) Pending Before

2013-14 Cenvat Credit 27,15,489/- Office of The claimed on Superintendent of Capital Goods Central Excise & Service Tax, Usgaon

d) According to the information and explanations given to us, there are no amounts required to the transferred to Investor Education and Protection Fund.

8) The Company is having accumulated losses in excess of 50% of its net worth as on 31st March 2015 and the Company has incurred cash losses in the previous financial year.

9) According to the information and explanations given and the records examined by us, the Company has not defaulted in repayment of dues to financial institutions and banks.

10) In our opinion and according to the information and explanations given to us, the Company has not given guarantee for loans taken by others from banks and Financial Institutions.

11) As per the records of the Company and information and explanations given to us, the Company has not taken any term loan.

12) In our opinion and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit that causes the financial statements to be materially misstated.

For R. SUNDARARAMAN & CO., Chartered Accountants (Registration No : 004219S)

S. SRIRAM Partner Membership No : 202813

Place : Chennai Date : May 26, 2015


Mar 31, 2014

1. Report on the Financial Statements

We have audited the attached Balance Sheet of HINDUSTAN FOODS LIMITED, Panaji, Goa, as at 31st March 2014, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the period ended on that date annexed thereto. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. Management''s Responsibility for the Financial Statements

The Company''s management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of 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 of the financial statements that give a true and fair view are free of material misstatement, whether due to fraud or error.

3. 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 of Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the 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 the 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 Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements.

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

4. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required subject to paragraphs 6(ii)(e), 6(ii)(f) and 6(ii)(g) and the consequent effect thereof on the assets, liabilities and cumulative loss of the Company 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 31st March 2014;

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

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

5. Emphasis of Matter

The Company is a Sick Industrial Company under Section 3(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 and has incurred cash losses for the current accounting year and previous year with negative networth as on 31st March 2014. Considering the various ongoing measures taken for the rehabilitation of the Company, the Accounts are presented on the principles applicable to a going concern.

Our opinion is not qualified in respect of the above matter.

6. Report on Other Legal and Regulatory Requirements

(i) As required by the Companies (Auditors Report) Order, 2003 ("the Order") issued by Central Government in terms of Section 227[4A] of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

(ii) 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, the Statement of Profit & 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, the Statement of Profit & Loss and Cash Flow Statement dealt with by this report comply with the Accounting Standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013

e) No provision for debts considered doubtful of recovery amounting to Rs. 2,49,55,257/- has been made (Refer Note 15)

f) Share issue, advertisement & sales promotion and Product launch expenses aggregating to Rs. 2,89,56,033/- have not been absorbed and carried forward under Miscellaneous Expenditure (Refer Note 13)

g) Depreciation amounting to Rs. 67,37,828/- on certain Fixed Assets has not been considered in the earlier years (Refer Note 32)

h) On the basis of the written representation received from the Directors as on 31st March 2014 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March 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 AUDITOR''S REPORT

Referred to in Paragraph 6(i) in our Report of even date

On the basis of the records produced to us for our verification / perusal, such checks as we considered appropriate and in terms of information and explanation given to us on our enquires, we state that:

1. In respect of fixed assets:

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

b) The fixed assets have been physically verified by the management during the period. We have been informed that no material discrepancies were noticed on such verification.

c) The Company has not disposed off any substantial part of fixed assets during the period and the going concern status of the Company is not affected.

2. In respect of inventories:

a) The stock of inventory has been physically verified by the management at the close of the period.

b) In our opinion, the procedures followed by the management for physical verification of inventories 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, the discrepancies noticed between physical verification of stocks and book records were not material, and the same have been properly dealt with in the books of account.

3. In respect of loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956:

a) The Company has not taken loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) The Company has not granted loans, secured or unsecured to companies, firms or other parties covered 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 procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets, sale of goods and services. During the course of our audit, no major weaknesses have been observed in the internal controls.

5. In respect of transactions covered under 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 needed to be entered in the register maintained under Section 301 of the Companies Act, have been so entered.

b) In our opinion and according to the information and explanations given to us, these transactions have been made at reasonable prices having regard to the prevailing market prices at that time.

6. The Company has not accepted any deposits from the public requiring compliance of Section 58A and Section 58AA of the Companies Act, 1956 and the rules framed there under.

7. Although the Company has no formalized internal audit system, its internal control procedures ensure reasonable internal checking of financial and other records and this can be considered adequate under the circumstances.

8. The Central Government has not prescribed the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 in respect of the business activities carried out by the Company.

9. In respect of statutory dues:

a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees state insurance, sales tax, custom duty, excise duty, cess, service tax and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of sales tax, custom duty, excise duty, service tax and cess were in arrears, as at 31st March 2014 for a period of more than six months from the date they became payable except Rs. 51.10 lacs towards Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

c) According to the information and explanations given to us, there are no dues of sales tax, custom duty, excise duty, service tax and cess, which have not been deposited on account of any dispute except for the following:

Year Details Amount (Rs.) Pending Before

Cenvat Credit Office of The Superintendent 2013-14 claimed on 14,64,117/- of Central Excise & Service Capital Goods Tax, Usgaon

10. The Company is having accumulated losses in excess of 50% of its net worth as on 31st March 2014. The Company has incurred cash losses during the current financial period. But there are no cash losses in the previous financial year.

11. According to the information and explanations given and the records examined by us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders. A sum of Rs. 51.10 lacs remains unclaimed by the debenture holders.

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

13. The Company is not a chit fund, or a nidhi, mutual fund / society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditors Report) Order 2003 are not applicable.

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order 2003 are not applicable.

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantee for loans taken by others from Banks and Financial Institutions, the terms and conditions whereof are prima facie prejudicial to the Company.

16. As per the records of the Company and information and explanations given to us, the Company has not taken any term loan.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term investment and vice versa, during the period.

18. 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 period.

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

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

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

For R. SUNDARARAMAN & CO., Chartered Accountants (Registration No : 004219S)

Place : Panjim S. SRIRAM Date: May 19, 2014 Partner Membership No : 202813


Sep 30, 2013

1. Report on the Financial Statements

We have audited the attached Balance Sheet of HINDUSTAN FOODS LIMITED, Panaji - Goa, as at 30th September 2013, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto, and a summary of the significant accounting policies and other explanatory information.

2. Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation of the financial statements that give a true and fair view and are free of material misstatement, whether due to fraud or error.

3. 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 of Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the 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 the 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 Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

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

4. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required subject to paragraphs 6(ii)(e), 6(ii)(f) and 6(ii)g) and the consequent effect thereof on the assets, liabilities and cumulative loss of the Company and give a true and fair view in conformity with the accounting principles generally accepted in India :

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

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

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

5. Emphasis of Matter

The Company is a Sick Industrial Company under Section 3(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 and has incurred cash losses for the current accounting year and previous year with negative networth as on 30th September 2013. Considering the various ongoing measures taken for the rehabilitation of the Company, the Accounts are presented on the principles applicable to a going concern.

Our opinion is not qualified in respect of the above matter.

6. Report on Other Legal and Regulatory Requirements

(i) As required by the Companies [Auditors Report] Order, 2003 ("the Order") issued by Central Government in terms of Section 227[4A] of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

(ii) 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, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

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

e) No provision for debts considered doubtful of recovery amounting to Rs. 246,26,099/- has been made (Refer Note 15);

f) Share issue, advertisement & sales promotion and product launch expenses aggregating Rs. 2,89,56,0331- have not been absorbed and carried forward under Miscellaneous Expenditure not w/off (Refer Note 13);

g) Depreciation amounting to Rs. 67,37,828/- on certain fixed assets has not been considered in the earlier years (Refer Note 32);

h) On the basis of the written representation received from the Directors as on 31st March, 2013 and taken on record by the Board of Directors, we report that none of the Directors are disqualified as on 31st March, 2013 from being appointed as Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

On the basis of the records produced to us for our verification / perusal, such checks as we considered appropriate and in terms of information and explanation given to us on our enquires, we state that:

1. In respect of fixed assets :

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

b) The fixed assets have been physically verified by the management during the period. We have been informed that no material discrepancies were noticed on such verification.

c) The Company has not disposed off any substantial part of fixed assets during the period and the going concern status of the Company is not affected.

2. In respect of inventories :

a) The stock of inventory has been physically verified by the management at the close of the period.

b) In our opinion, the procedures followed by the management for physical verification of inventories 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, the discrepancies noticed between physical verification of stocks and book records were not material, and the same have been properly dealt with in the books of account.

3. In respect of loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act,1956 :

a) The Company has taken interest free and interest bearing loan from its Holding Company, which are repayable on demand. The maximum balance outstanding during the period and the period-end balance is Rs. 1418.27 lacs. The Company has :aken interest free unsecured loan from a Company listed in the register maintained under Section 301 of the Companies Act, which is repayable on demand. The maximum balance outstanding during the period and the period-end balance is Rs. 12.50 lacs. The Company has also taken interest bearing unsecured loan from a Company listed in the register maintained under Section 301 of the Companies Act, 1956, which is repayable on demand. The maximum balance outstanding during the period and the period-end balance is Rs. 95.96 lacs.

b) The Company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

c) As per the explanations given to us, the rate of interest and other terms and conditions of the loans taken by the Company are prima-facie not prejudicial to the interest of the Company.

d) There are no overdue amounts more than Rupees One lakh.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets, sale of goods and services. During the course of our audit, no major weaknesses have been observed in the internal controls.

5. In respect of transactions covered under 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 needed to be entered in the register maintained under Section 301 of the Companies Act, have been so entered.

b) In our opinion and according to the information and explanations given to us, these transactions have been made at reasonable prices having regard to the prevailing market prices at that time.

6. The Company has not accepted any deposits from the public requiring compliance of Section 58A and Section 58AAof the Companies Act, 1956 and the rules framed there under.

7. Although the Company has no formalized internal audit system, its internal control procedures ensure reasonable internal checking of financial and other records and this can be considered adequate under the circumstances. .

8. The Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 in respect of the business activities carried out by the Company.

9. In respect of statutory dues :

a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees state insurance, sales tax, custom duty, excise duty, cess, service tax and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of sales tax, custom duty, excise duty, service tax and cess were in arrears, as at 30th September 2013 for a period of more than six months from the date they became payable except Rs. 51.12 lacs towards Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

c) According to the information and explanations given to us, there are no dues of sales tax, custom duty, excise duty, service tax and cess, which have not been deposited on account of any dispute.

10. The Company is having accumulated losses in excess of its net worth as on 30th September 2013. The Company has incurred cash losses during the current financial year and the previous financial year.

11. According to the information and explanations given and the records examined by us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders. A sum of Rs. 51.;12 lacs remains unclaimed by the debenture holders.

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

13. The Company is not a chit fund, or a nidhi, mutual fund / society. Therefore the provisions of clause

4 (xiii) of the Companies (Auditors Report) Order 2003 are not applicable.

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order 2003 are not applicable.

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantee for loans taken by others from Banks and Financial Institutions, the terms and conditions whereof are prima facie prejudicial to the Company.

16. As per the records of the Company and information and explanations given to us, the Company has not taken any term loan.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term investment and vice versa, during the period.

18. 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.

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

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

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

For R. SUNDARARAMAN & CO.,

Chartered Accountants

(Registration No : 004219S)



S. SRIRAM

Place : Panaji Partner

Date : November 15, 2013 Membership No : 202813


Mar 31, 2011

1. We have audited the attached Balance Sheet of HINDUSTAN FOODS LIMITED, Panaji, Goa, as at 31st March, 2011 and also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 [Auditors Report] Order, 2003 issued by Central Government in terms of Section 227[4A] of the Companies Act, 1956, we enclose in the Annexure hereto 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 in Paragraph 3, we report that:

(i) 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;

(ii) 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;

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

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

(v) On the basis of the written representation received from the Directors as on 31st March, 2011, we report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as a Director in terms of clause (g) of Sub section (1) of Section 274 of the Companies Act, 1956.

(vi) No provision for debts considered doubtful of recovery amounting to Rs. 2,00,86,601/- has been made (Refer Schedule VII) (vii) Share issue, advertisement & sales promotion and Product launch expenses Aggregating to Rs. 2,71,23,762/- have not been absorbed and carried forward under Miscellaneous Expenditure (Refer Schedule XII)

(viii) Depreciation amounting to Rs. 67,37,828/- on certain Fixed Assets has not been considered in the earlier years (Refer Note B-2(f) of Schedule XIX)

(ix) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956 in the manner so required subject to paragraph (VI), (VII), (VIII) above and consequent effect thereof on the assets, liabilities and the cumulative loss of the Company 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 31st March 2011;

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

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

ANNEXURE TO AUDITOR'S REPORT

Referred to in Paragraph 3 in our Report of even date

On the basis of the records produced to us for our verification / perusal, such checks as we considered appropriate and in terms of information and explanation given to us on our enquires, we state that:

1. In respect of fixed assets :

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

b) The fixed assets have been physically verified by the management during the year. We have been informed that no material discrepancies were noticed on such verification.

c) The Company has not disposed off any substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of inventories :

a) The stock of inventory has been physically verified by the management at the close of the year.

b) In our opinion, the procedures followed by the management for physical verification of inventories 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, the discrepancies noticed between physical verification of stocks and book records were not material, and the same have been properly dealt with in the books of account.

3. In respect of loans, secured or unsecured, granted or taken by the Company to /from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 :

a) The Company has taken interest free and partly interest bearing loan from its Holding Company, which is repayable on demand. The maximum balance outstanding during the year and the year-end balance is Rs. 681.83 lacs. The Company has taken partly interest bearing unsecured loan from a company as listed in the register maintained under Section 301 of the Companies Act, 1956, which is repayable on demand. The maximum balance outstanding during and the year-end balance is Rs. 137.30 lacs.

b) The Company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

c) As per the explanations given to us, the rate of interest and other terms and conditions of the loans taken by the Company are prima-facie not prejudicial to the interest of the Company.

d) There are no over due amounts more than Rupees One lakh.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets, sale of goods and services. During the course of our audit, no major weaknesses have been observed in the internal controls.

5. In respect of transactions covered under 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 needed to be entered in the register maintained under Section 301 of the Companies Act, have been so entered.

b) In our opinion and according to the information and explanations given to us, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- or more in respect of any party.

6. The Company has not accepted any deposits from the public requiring compliance of Section 58A and Section 58AA of the Companies Act, 1956 and the rules framed there under.

7. Although the Company has no formalized internal audit system, its internal control procedures ensure reasonable internal checking of financial and other records and this can be considered adequate under the circumstances.

8. The Central Government has not prescribed the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956 in respect of the business activities carried out by the Company.

9. In respect of statutory dues :

a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees state insurance, sales tax, custom duty, excise duty, cess, service tax and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of sales tax, custom duty, excise duty, service tax and cess were in arrears, as at 31st March, 2011 for a period of more than six months from the date they became payable except Rs. 51.16 lacs towards Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

c) According to the information and explanations given to us, there are no dues of sales tax, custom duty, excise duty, service tax and cess, which have not been deposited on account of any dispute.

10. The Company is having accumulated losses in excess of 50% of its net worth as on 31st March, 2010. There are no cash losses during the current financial year, but the Company has incurred cash losses in the previous financial year.

11. According to the information and explanations given and the records examined by us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders. A sum of Rs. 51.16 lacs remains unclaimed by the debenture holders.

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

13. The Company is not a chit fund, or a nidhi, mutual fund / society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditors Report) Order 2003 are not applicable.

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order 2003 are not applicable.

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantee for loans taken by others from Banks and Financial Institutions, the terms and conditions whereof are prima facie prejudicial to the Company.

16. As per the records of the Company and information and explanations given to us, the Company has not taken any term loan.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term investment and vice versa, during the year.

18. 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.

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

For R. SUNDARARAMAN & CO.

Chartered Accountants

(Registration No.: 004219S)

S. SRIRAM

Place : Chennai Partner

Date : May 23, 2011 Membership No.: 202813


Mar 31, 2010

1. We have audited the attached Balance Sheet of HINDUSTAN FOODS LIMITED, Panaji, Goa, as at 31st March, 2010 and also the Profit and Loss Account and the 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.

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 [Auditors Report] Order, 2003 issued by Central Government in terms of Section 227[4A] of the Companies Act, 1956, we enclose in the Annexure hereto 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 in Paragraph 3, we report that:

(i) 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;

(ii) 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;

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

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

(v) On the basis of the written representation received from the Directors as on 31st March, 2010, we report that none of the Directors is disqualified as on 31st March, 2010 from being appointed as a Director in terms of clause (g) of sub section (1) of Section 274 of the Companies Act, 1956; (vi) No provision for debts considered doubtful of recovery amounting to Rs. 2,00,86,601/- has been made (Refer Schedule VII);

(vii) Share issue and advertisement & sales promotion expenses aggregating to Rs. 2,31,75,268/- have not been absorbed and carried forward under Miscellaneous Expenditure (Refer Schedule XI);

(viii) Depreciation amounting to Rs. 67,37,828/- on certain Fixed Assets has not been considered in the earlier years (Refer Note B-2(f) of Schedule XVI);

(ix) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956 in the manner so required subject to paragraph (vi), (vii), (viii) above and consequent effect thereof on the assets, liabilities and the cumulative loss of the Company 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 31st March, 2010;

(b) In the case of the Profit and Loss Account, of the Loss of the Company 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.

ANNEXURE TO AUDITORS REPORT

Referred to in Paragraph 3 in our Report of even date

On the basis of the records produced to us for our verification / perusal, such checks as we considered appropriate and in terms of information and explanation given to us on our enquires, we state that:

1. In respect of fixed assets :

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

b) The fixed assets have been physically verified by the management during the year. We have been informed that no material discrepancies were noticed on such verification.

c) The Company has not disposed off any substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of inventories :

a) The stock of inventory has been physically verified by the management at the close of the year.

b) In our opinion, the procedures followed by the management for physical verification of inventories 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, the discrepancies noticed between physical verification of stocks and book records were not material, and the same have been properly dealt with in the books of account.

3. In respect of loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956:

a) The Company has taken interest free loan from its Holding Company in respect of which there is no stipulation as to repayment. The maximum balance outstanding during the year and the year-end balance is Rs. 571.83 lacs. The Company has taken partly interest bearing unsecured loan from a company as listed in the register maintained under Section 301 of the Companies Act, 1956, in respect of which there is no stipulation as to repayment. The maximum balance outstanding during the year is Rs. 299.13 lacs and the year-end balance is Rs. 137.30 lacs.

b) The Company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

c) As per the explanations given to us, the rate of interest and other terms and conditions of the loans taken by the Company are prima-facie not prejudicial to the interest of the Company.

d) There are no over due amounts more than Rupees One lakh.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its

business for the purchase of inventory, fixed assets, sale of goods and services. During the course of our audit, no major weaknesses have been observed in the internal controls.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956 :

a) In ouropinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that needed to be entered in the register maintained under Section 301 of the Companies Act, have been so entered.

b) In our opinion and according to the information and explanations given to us, there are no transactions in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- or more in respect of any party.

6. The Company has not accepted any deposits from the public requiring compliance of Section 58Aand Section 58AAof the Companies Act, 1956 and the rules framed there under.

7. Although the Company has no formalized internal audit system, its internal control procedures ensure reasonable internal checking of financial and other records and this can be considered adequate under the circumstances.

8. The Central Government has not prescribed the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956 in respect of the business activities carried out by the Company.

9. In respect of statutory dues :

a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees state insurance, sales tax, custom duty, excise duty, cess, service tax and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of sales tax, custom duty, excise duty, service tax and cess were in arrears, as at 31st March, 2010 for a period of more than six months from the date they became payable except Rs. 51.22 lacs towards Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

c) According to the information and explanations given to us, there are no dues of sales tax, custom duty, excise duty, service tax and cess, which have not been deposited on account of any dispute.

10. The Company is having accumulated losses in excess of 50% of its net worth as on 31st March, 2010. The Company has incurred cash losses during the current financial year and previous financial year.

11. According to the information and explanations given and the records examined by us, the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders. A sum of Rs. 51.22 lacs remains unclaimed by the debenture holders.

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

13. The Company is not a chit fund, or a nidhi, mutual fund / society. Therefore the provisions of clause 4 (xiii) of the Companies (Auditors Report) Order 2003 are not applicable.

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order 2003 are not applicable.

15. In our opinion and according to the information and explanations given to us, the Company has not given guarantee for loans taken by others from Banks and Financial Institutions, the terms and conditions whereof are prima facie prejudicial to the Company.

16. As per the records of the Company and information and explanations given to us, the Company has not taken any term loan.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term investment and vice versa, during the year.

18. 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.

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

For R. SUNDARARAMAN & CO.

Chartered Accountants



Place : Chennai S. SRIRAM

Date : 25th May, 2010 Partner

Membership No.: 202813

Firm Regn. No.: 004219S

 
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