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Auditor Report of Jindal Stainless (Hisar) Ltd.

Mar 31, 2016

We have audited the accompanying standalone financial statements of JINDAL STAINLESS (HISAR) LIMITED (“the Company”), which comprise the Balance Sheet as at 31stMarch, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information in which are incorporated the RETURN for the year ended on that date audited by the branch auditor of the Company’s branch at Kothavalasa in Vizianagaram district, Andhra Pradesh.

Management’s Responsibility for the Standalone Financial Statements

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

7 of the Companies (Accounts) Rules, 2014.This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone 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 standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the standalone financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31stMarch, 2016, and its profit and its cash flows for the year ended on that date.

Emphasis of Matters:

We draw attention to the following matters:

a) Pending Confirmation of Balances of Certain borrowings as stated in footnote (*) of Note 7 read with note no. 26 of the financial statements.

b) Loan & advances to certain subsidiary companies, considered as good and fully realizable/recoverable and no provision for diminution in value is considered necessary in the opinion of the managements stated in Note 36(B) of the financial statements.

c) Transfer of Mining Rights pursuant to the Scheme in favour of the Company is subject to necessary approvals of the concerned authorities as stated in Note 26 (1)(g) of the financial statements; and pending the same, effect of mining operations carried out by JSL as above included in the financial statement of JSL as stated in Note 26 (2) of the financial statements.

d) Pending allotment of equity shares against amount of Rs. 36,618.67 Lacs by JSL of the aforesaid equity shares to the company shown as investment (pending allotment) under non-current investment for the reasons as explained in note no. 26 (1) (d) of the financial statements.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of sub-section (11) of section 143 of 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 during the course of audit, we give in the Annexure ‘A’ a statement on the matters specified in the paragraphs 3 and 4 of the Order.

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from the branch not visited by us.

(c) The reports on the accounts of the branch office of the Company audited under section 143(8) of the Act by branch auditor have been sent to us and have been properly dealt with us in preparing this report.

(d) 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 and with the returns received from the branch not visited by us.

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

(f) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) As required by section 143(3)(i) of the Companies Act, 2013, and based on the checking of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, our separate report with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls is as per Annexure ‘B’.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - refer note no. 27 & 38 to the standalone financial statements.

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long term contracts including derivatives contracts.

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

Annexure “A” referred to in paragraph 1 under the heading “Report on other legal and regulatory requirements” of our report of even date on the Standalone Financial Statements of JINDAL STAINLESS (HISAR) LIMITED for the year ended 31st March 2016

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

(b) The Company has a regular programme of Physical Verification of its Fixed assets by which fixed asset have been verified by the management according to the programe of periodical physical verification in a phased manner which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such physical verification were not material.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company read with footnote (@) of note no. 10 of the standalone financial statement.

2. The inventories of the Company (except stock lying with the third parties and in transit) have been physically verified by the management at reasonable intervals. In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable in relation to the size of the Company and nature of its business. The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

3. The Company has granted loans, unsecured to one company, covered in the register maintained under section 189 of the Companies Act, 2013:-

a) According to the information and explanations given to us and based on the audit procedures conducted by us, we are of the opinion that terms and conditions of aforesaid loans so granted are not prejudicial to the interest of the Company.

b) In respect of aforesaid loan, repayment of principal & payment of interest has been stipulated and Interest (payable on half yearly basis)has not become due for payment as on 31stMarch 2016.

c) In respect of aforesaid loan, principal and interest has not become due for payment as on 31stMarch 2016.

4. According to the information, explanations and representations provided by the management and based upon audit procedures performed, we are of the opinion that in respect of loans, investments, guarantees and security, the Company has complied with the provisions of the Section 185 and 186 of the Companies Act, 2013.

5. In our opinion and according to the information and explanations given to us, the Company has complied with the directive issued by the Reserve Bank of India and the provisions of Section 73 to76 of the Act or any other relevant provisions of the Act and the rules framed there under (to the extent applicable).Based on the records and information and explanations provided to us, the company has not accepted any deposit from the public during the year. We have been informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or other Tribunal in this regard.

6. We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Act in respect of the company’s products to which they said rules are made applicable and are of the opinion that prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

7. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including provident fund, employees’ state insurance, income tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues with the appropriate authorities to the extent applicable and there are no undisputed statutory dues payable for a period of more than six months from the date they become payable as at 31st March, 2016.

(b) According to the records and information & explanations given to us, there are no dues in respect of income tax that have not been deposited with the appropriate authorities to the extent applicable on account of any dispute and the dues in respect of

8. In our opinion, on the basis of audit procedures and according to the information and explanations given to us, the Company has not defaulted in repayment of loans and borrowings to financial institutions, banks, government and dues to debenture holders, as applicable.

service tax, duty of customs, duty of excise, sales tax and value added tax that have not been deposited with the appropriate authorities on account of any dispute and the forum where the dispute is pending are given below: -

Name of the statue

Nature of the Dues

Amount Period to which ('' in lacs) the amount relates

Forum where dispute is pending

Central Excise Act,1944

Excise Duty

1.69 April 95 - June 95

High Court, New Delhi

658.08 Jan 99 - Dec 04

High Court of Punjab & Haryana.

265.43 Oct 11 - Jul 13

Commissioner (Appeals), Delhi-I

24.60 July 11 - Sept 11

Revisionary Authority ,GoI, New Delhi

217.47 Oct 13 - Jun 14

Commissioner (Appeals), Delhi-I

180.04 Aug 08 - June 09

CESTAT, Chandigarh

73.59 Aug 09 - Feb 10

CESTAT, Chandigarh

54.38 Jan 05 - June 05

CESTAT, Chandigarh

7.57 2000-01

CESTAT, Chandigarh

1,480.40 July 05 - Dec 07

Commissioner, Rohtak

1.83 Dec 06 - Oct 07

Commissioner (Appeal) Visakhapatnam

556.69 2006-2007

CESTAT, Chandigarh

7.63 1994-95

Addl. Commissioner of Central Excise, Rohtak.

1.02 April 07 - Oct 07

High Court of Punjab & Haryana.

4.74 May 07 - Oct 07

High Court of Punjab & Haryana.

5.21 Jul-09

High Court of Punjab & Haryana.

The Custom Act, 1962

Custom Duty

60.00 2008-09

CESTAT, Delhi.

10.00 2012-13

CESTAT, Delhi.

Finance Act,1994

Service Tax

522.83 Dec 03 - March-06

CESTAT, Chandigarh

9.79 2005-06 to 2010-11

Addl. Commissioner of Central Excise, Rohtak.

The Central Sales Tax, 1956

Sales Tax

3.00 1993-94

High Court of Punjab & Haryana.

9. On the basis of information and explanations given to us, term loan were applied for the purpose for which the loans were obtained. No moneys have been raised during the year by way of initial public offer or further public offer.

10. Based on the audit procedure performed and on the basis of information and explanations provided by the management, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the course of the audit.

11. According to the information and explanations given to us and based on our examination of the records of the Company, managerial remuneration has been paid/ provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act.

12. In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

13. According to the information and explanations and records made available by the management of the Company and audit procedure performed, for transactions with the related parties during the year, the Company has complied with the provisions of Section 177 and 188 of the Act, where applicable. As explained and as per records, details of related party transactions have been disclosed in the standalone financial statements as per the applicable Accounting Standards.

14. According to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. During the year, the Company has issued and allotted 12,50,00,000 number Compulsory Convertible Warrants (CCW) of Rs.2/- each to promoter group entities on preferential basis for the purpose to infuse funds by promoters in terms of sanction letter dated 23rd November 2015 by State Bank of India as stated in Note 30 of the accompanying financial statements and in this connection requirement of section 42 of the Companies Act, 2013 has been complied with.

15. On the basis of records made available to us and according to information and explanations given to us, the Company has not entered into non-cash transactions with the directors or persons connected with him.

16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

ANNEXURE ‘B’ TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF JINDAL STAINLESS (HISAR) LIMITED

Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of JINDAL STAINLESS (HISAR) LIMITED (“the Company”) as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date in which are incorporated the RETURN for the year ended on that date audited by the branch auditor of the Company’s branch at Kothavalasa in Vizianagaram district, Andhra Pradesh.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor’s Responsibility

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

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls Over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For LODHA & CO. For S.S. KOTHARI MEHTA & CO.

Chartered Accountants Chartered Accountants

FRN: 301051E FRN: 000756N

N.K. LODHA SUNIL WAHAL

Partner Partner

Membership No. 85155 Membership No. 87294

Place : New Delhi

Dated : 27th May 2016


Mar 31, 2015

We have audited the accompanying REVISED standalone financial statements of Jindal Stainless (Hisar) Limited (formerly known as Jindal Stainless (Hisar) Private Limited) ("the Company"), which comprise the REVISED Balance Sheet ("Balance Sheet") as at 31st March, 2015, the REVISED Statement of Profit and Loss ("Statement of Profit and Loss"), the REVISED Cash Flow Statement ("Cash Flow Statement") for the year then ended, and a summary of significant accounting policies and other explanatory information in which impact of the Scheme (as stated in Note no. 26) have been incorporated.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

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

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

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

Opinion

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

Emphasis of Matters

Attention is drawn to the followings:

(a) Note no. 34 (B) regarding certain investments and loan & advances considered as good and fully realizable/ recoverable related to certain subsidiary companies, for the reason stated in the said note and no provision for diminution in value is necessary in the opinion of the management.

Our opinion is not modified in respect of above matters.

Other Matter

The standalone financial statements of the Company for the year ended 31st March, 2015 were earlier approved by the Board of Directors at their meeting held on 25th May, 2015, on which we had issued our report dated 25th May, 2015. These financial statements have been reopened and revised to give effect to the Scheme as explained in Note No. 26.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note-27 and 38 to the financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;

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

ANNEXURE TO INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph (1) under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date for the year ended 31st March, 2015)

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

(b) A major portion of the fixed assets has been physically verified by the Management in accordance with a phased programme of verification adopted by the Company. In our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its assets. To the best of our knowledge, no material discrepancies have been noticed on such verification.

2. (a) As informed, the inventory of the company (except stocks

lying with third parties, in transit), part of the stores and spares, have been physically verified by the management either at the end of the year or after the year end, and in respect of stores and spares, there is perpetual inventory system and a substantial portion of the stocks have been verified during the year. In our opinion, the frequency of verification is reasonable.

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

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventories. The discrepancies noticed during physical verification of inventories as compared to book records were not material and the same have been properly dealt within the books of account.

3. The Company has given interest bearing unsecured demand loans to companies, covered in the register maintained under section 189 of the Companies Act, 2013.

(a) In respect of aforesaid loan, the amount, principal as well as interest accrued thereon is repayable on demand and hence, the question of irregularity on payment of principal and interest does not arise.

(b) The aforesaid loan is repayable on demand and therefore, the question of overdue amount does not arise.

4. In our opinion and according to information and explanations given to us, having regard to the explanation that some of the items purchased are of special nature and suitable alternative sources do not exist for obtaining comparable quotations, there are adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of inventories, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5. According to the information given to us, the company has not accepted any deposits under provisions of section 73 to 76 of ' the Companies Act, 2013 or any other relevant provisions of the Companies Act and the Companies (Acceptance of Deposits) Rules, 2014. No order has been passed with respect to section 73 to 76, by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

6. We have broadly reviewed the books of account and records maintained by the company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 148 (1) of the Companies Act, 2013 in respect of the company's products and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of records with a view to determine whether they are accurate or complete.

7. (a) According to the information and explanations given to us, the Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other statutory dues. There are no arrears as at 31st March, 2015 for a period of more than six months from the date they become payable.

(b) According to the information and explanation given I there are no dues in respect of Income Tax, Wealth and Cess that have not been deposited with appropriate authorities to the extent applicable on acute of any dispute and the dues in respect of sales tax, of excise, Service tax and duty of customs that have been deposited with the appropriate authorities on account of dispute and the forum where the disputes are pending, are given below:

Name of the statue Nature of the Dues Amount Period to which (Rs,in lacs) the amount relates

Central Excise Act, 1944 Excise Duty 1.69 April 1995 to June 1995

658.08 Jan 1999 to Dec 2004

274.80 Aug 2008 to Dec 2010

27.19 Jan 2005 to June 2005

7.57 2000-01

2,960.81 July 2005 to Dec 2007

24.60 July 2011 to Sept.2011

556.69 2006-07

7.63 1994-95 Excise, Rohtak.

59.06 Oct.2011 to sept 2012

206.56 Sept.2012 to july 2013

1.02 April 2007 to Oct 2007

0.74 May 2007 to Oct.2007

5.21 July 2009

The Custom Act, 1962 Custom Duty 60.00 2008-09

10.00 2012-13

Finance ACt,1994 Service Tax 522.83 Dec.2003 to March 2006

9.79 2005-06 to 2010-11

The Central Sales Tax, 1956 Sales Tax 3.00 1993-94

Name of the statue Forum where dispute is pending

Central Excise Act, 1944 High Court, New Delhi

High Court of Punjab & Haryana

CESTAT, Delhi.

CESTAT, Delhi.

CESTAT, Delhi.

CESTAT, Delhi.

CESTAT, Delhi.

CESTAT, Delhi.

Addl. Commissioner of Central

Commissioner (Appeals), Delhi III. Gurgaon

COMMISSIONER (Appeals), Delhi III Gurgaon

High Court of Punjab & Raryana.

High Court of Punjab & Haryana.

High Court of Punjab & Haryana.

The Custom Act, 1962 CESTAT, Delhi.

CESTAT, Delhi.

Finance Act,1994 CESTAT, Delhi.

Commissioner (Appeals & Gurgaon

The Central Sales Tax, 1956 High Court of Punjab & Haryana.

(c) There is no amount payable towards Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under. Hence paragraph 3(vii)(c) of the Order is not applicable to the Company.

8. The Company is in existence for less than five years. Hence, paragraph 3(viii) of the Order with regard to accumulated losses of the Company more than fifty percent of net worth and losses in current financial year and immediately preceding financial year is not applicable to the Company.

9. According to the information and explanations given to us, the Company has not issued any debentures and has not taken any other loan from Banks/Financial Institution. Accordingly, the provision of paragraph 3(ix) of the order is not applicable to the company.

10. According to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from banks. (Read with note no 27 (C)).

11. According to the records of the Company examined by us, the Company has not taken any term loan. Accordingly, the provision of paragraph 3(xi) of the order is not applicable to the company.

12. During the course of our examination of the books and records of the Company, and according to the information and explanations given to us by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For N.C. Aggarwal & Co,

Chartered Accountants

Firm Registration No. 003273N



G. K, Aggarwal

Place: New Delhi Partner

Dated: 6th November, 2015

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