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Auditor Report of KG Petrochem Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of KG Petrochem Limited ('the Company') which comprises the Balance Sheet as at 31 st March, 2015, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statement

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.

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 Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 ("the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 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 and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, 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 accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion, and to the best of our information and according to the explanations given to us, the 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 of the Company for the year ended on that date. 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 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 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 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 comply with the Accounting Standards notified 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, and 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 164(2) of the Companies Act, 2013; and

(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) there are no pending litigations on the Company's financial position in its 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; and

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

As required by the Companies (Auditor's report) Order, 2015 issued by the Central Government of India in terms of section 143(11) of the Companies Act, 2013, we report tfiat:

(i) In respect of fixed assets:

(a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets on the basis of available information.

(b) As explained to us, all the fixed assets have been physically verified by the management during the year at reasonable intervals, which in our opinion, is reasonable having regard to the size of the Company and the nature of assets. As explained, no material discrepancies were noticed on such physical verification.

(ii) In respect of its inventories:

(a) As explained to us, the inventory has been physically verified by the management at regular intervals 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 followed by the management for physical verification of inventory are reasonable and adequate in relation to size of the Company and nature of its business.

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company has maintained proper records of inventory. And there were no material discrepancies noticed on physical verification of inventory as compared to the book records.

(iii) In respect of loans, secured or unsecured, granted by the Company to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act 2013:

(a) According to the information and explanations given to us, the Company has not granted any loans, secured and unsecured, to companies, firms and other parties covered in the register maintained under section 189 of Companies Act, 2013.

(iv) In our opinion and according to the information and explanations given to us, there exists adequate internal control procedure commensurate with the size of the Company and nature of its business with regard to purchase of inventory and fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the Company.

(v) According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of the directives issued by the Reserve Bank of India and the provisions of section 73 to 76 or any relevant provisions of the Companies Act, 2013 and the rules made there under.

(vi) We have been explained that the maintenance of cost records has been prescribed by the Central Government under Section 148(1) of the Companies Act, 2013 for the period under review and we are of the opinion that prima-facie the prescribed accounts and records have been made and maintained. However, we have not made the detailed examination of the records with a view to determine whether they are accurate and complete.

(vii) In respect of statutory dues:

(a) The Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Value Added Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it with the appropriate authorities though there has been slight delay in a few cases.

However, no undisputed amounts are payable in respect of Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty and Excise Duty were in arrears as at the end of the financial year for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty and Excise Duty which have not been deposited on account of any dispute except the following:

Nature of Nature of Amount Period to which the Forum where Dispute the dues (in Rs.) amount relates pending

Finance Act, FY 2005-06 FY

1994 Service Tax 33,75,730/- 2008 09 CESTAT (Service Tax

Central FY 2001 -02 Excise Act Excise to FY Duty 2,43,190/-

(c) According to the information and explanations given to us, no amount was required to be transferred to Investor Education and Protection Fund by the Company.

(viii) The Company has no accumulated losses at the end of the year and the Company has not incurred cash losses during current and the immediately preceding financial year.

(ix) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to banks or financial institutions or debenture holders.

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

(xi) In our opinion and according to information and explanation given to us, the term loans have been applied for the purpose for which they were raised.

(xii) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

For R Sogani & Associates

Chartered Accountants

FRN: (018755C)



(BHARAT SONKHIYA)

Place: Jaipur PARTNER

Date: 30.05.2015 Membership No: 403023


Mar 31, 2014

We have audited the accompanying financial statements of KG Petrochem Ltd. (''the Company'') which comprises the Balance Sheet as at 31st March, 2014, the Statement of Profit and Loss and Cash Flow Statement for the year ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and Cash Flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 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 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

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

b) 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 (''the Order''), as amended, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act, we give in the anaxure a statement on the matter specified in peragraph 4 and 5 of the order.

2. As required by section 227(3) of the Act, we report that:

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

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

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

d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement 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; and

e) On the basis of written representations received from the Directors as on 31st March, 2014, and taken on record by the Board of Directors, none of the directors are 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 Act.

ANNEXURE REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING OF "REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OF EVEN DATE

As required by the Companies (Auditor''s report) Order, 2003 issued by the Central Government of India in terms of section 227(4A) of the Companies Act, 1956, we report that:

1 In respect of its fixed assets:

(A) The Company has prepared records showing full particulars, including quantitative details and situation of fixed assets as explained by the Management.

(B) As explained to us, all the fixed assets have been physically verified by the management during the year at reasonable intervals, which in our opinion, is reasonable, having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such physical verification.

(C) In our opinion, the Company has not disposed off any substantial/major part of its fixed assets during the year, hence, the going concern status of the Company is not affected.

2 In respect of its inventories:

(A) As explained to us, the inventory has been physically verified by the management at regular intervals 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 followed by the management for physical verification of inventory are reasonable and adequate in relation to size of the Company and the nature of its business.

(C) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company has maintained proper records of inventory. And, there were no material discrepancies noticed on physical verification of inventory as compared to the book records.

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) According to the information and explanations given to us, the Company has not granted any loans, secured and unsecured, to companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(B) Long term unsecured loans taken from persons covered in the register maintained under section 301 of the Companies Act, 1956 amounting to Rs. 299.23 lacs outstanding at the year end and the maximum amount involved is Rs. 535.57 lacs.

(C) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions on which loans have been taken from the parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(D) According to the information and explanations given to us, no stipulation has been made for the repayment of principal amount and interest in respect of loans taken from the parties listed in the register maintained under section 301 of the Companies Act, 1956.

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

5 In respect of contracts or arrangements entered in the register maintained in pursuance of Section 301 of the Companies Act, 1956:

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

(B) In our opinion and according to explanations given to us, the transactions exceeding the value of Rs. Five lacs in respect of any party during the year have been made at prices which are prima-facie reasonable having regard to prevailing market prices at the relevant time where such prices are available.

6 According to the information and explanations given to us, the Company has not accepted deposits from the public during the year.

7 In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with the size and nature of its business which needs to be strengthened.

8 We have broadly reviewed the accounts and records maintained by the company pursuant to the Rules made by the central Government for the maintenance of cost records under section 209(1)(d) of the companies Act ,1956 and we are of the opinion that prima-facie the prescribed accounts and records have been made and maintained. However, we have not made detailed examination of the records with a view to determine whether they are accurate and complete.

9 In respect of statutory dues:

(A) The Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Value Added Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess 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 Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty and Excise Duty were in arrears as at the end of the financial year 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, Income Tax, Custom Duty, Wealth Tax, Excise Duty, Service Tax and Cess which have not been deposited on account of any dispute except the following:

Statement on Disputed Dues

Period to Forum where Nature of the Nature of Amount which the dispute is Statute the dues (in Rs.) amount pending. relates

Finance Act, FY 2005 -06 1994 (Service Service Tax 33,75,730/- to FY 2008 - CESTAT Tax) 09

FY 2001 -02 Central Excise to FY 2004 - Act, 1944 Excise Duty 2,43,190/- 05 (upto CESTAT Feb. 2005)

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

11 Based on our audit procedures and on the basis of information and explanations given by the management, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders during the year.

12 In our opinion and according to information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13 In our opinion, the Company is not a Chit Fund/Nidhi or Mutual Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable to the Company.

14 The Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to the Company.

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

16 In our opinion and according to information and explanation given to us, the term loans have been applied for the purpose for which they were raised.

17 According to the information and explanations given to us and on overall examination of Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investment.

18 According to the information and explanation given to us, the Company has not made any preferential allotment of shares to any party during this year.

19 According to the information and explanation given to us, the Company has not issued debentures.

20 The Company has not raised any monies by way of any public issues during the year.

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

For R Sogani & Associates Chartered Accountants FRN 018755C

(CA Rakesh Kedia) Place: Jaipur Partner Date: 30/05/2014 M. No. 074620


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of M/s KG Petrochem Limited (''the Company'') which comprises the Balance Sheet as at 31st March, 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility forthe Financial Statements

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

Auditor''s Responsibility

a) Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those

Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

b) 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2013;

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. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 (''the Order''), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we 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 ouraudit;

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

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

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

e) on the basis of written representations received from the Directors as on 31st March, 2013, and taken on record by the board of directors, none of the directors are disqualified as on 31st March, 2013, from being appointed as a Director in terms of clause (g) of sub-section (1) of section 274 of the Act.

ANNEXURE REFERRED TO IN PARAGRAPH 2 OF THE AUDITOR''S REPORT ON THE ACCOUNTS OF KG PETROCHEM LIMITED FOR THE YEAR ENDING 31ST MARCH, 2013

As required by the Companies (Auditor''s report) Order, 2003 issued by the Central Government of India in terms of section 227(4A) of the Companies Act, 1956, we report 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 on the basis of available information.

(B) As explained to us, all the fixed assets have been physically verified by the management during the year at reasonable intervals, which in our opinion, is reasonable having regard to the size of the Company and the nature of assets. No material discrepancies were noticed on such physical verification.

(C) In our opinion the Company has not disposed off any substantial/major part of fixed assets during the year and the going concern status of the Company is not affected.

2 In respectof its inventories:

(A) As explained to us, the inventory has been physically verified by the management at regular intervals 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 followed by the management for physical verification of inventory are reasonable and adequate in relation to size of the Company and nature of its business.

(C) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company has maintained proper records of inventory. And there were no material discrepancies noticed on physical verification of inventory as compared to the book records.

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) According to the information and explanations given to us, the Company has not granted any loans, secured and unsecured, to companies, firms and other parties covered in the register maintained under section 301 of Companies Act, 1956.

(B) Long term unsecured loans taken from persons covered in the register maintained under section 301 of the Companies Act, 1956 amounting to'' 148.00 lacs outstanding at the year end and the maximum amount involved isRs. 148.00 lacs.

(C) In our opinion, the rate of interest and other terms and conditions on which loans have been taken from the parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

(D) According to the information and explanations given to us, no stipulation has been made for the repayment of principal amount and interest in respect of loans taken from the parties listed in the register maintained under section 301 of the CompaniesAct, 1956.

4 In our opinion and according to the information and explanations given to us, there exists adequate internal control procedure commensurate with the size of the Company and nature of its business with regard to purchase of inventory and fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the Company.

5 In respect of contracts or arrangements entered in the register maintained in pursuance of Section 301 of the Companies Act, 1956:

(A) In our opinion and according to the information and explanation 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 1956 have been so entered.

(B) In our opinion and explanation given to us, the transactions exceeding the value of'' Five lacs in respect of any party during the year have been made at prices which are prima-facie reasonable having regard to prevailing market prices at the relevant time where such prices are available.

6 According to the information and explanations given to us, the Company has not accepted new deposits from the public during the year.

7 In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with its size and nature of its business.

8 According to the information and explanations given to us the cost records are under the process of preparation. Hence, we have not reviewed the books of account required to be maintained by the Company pursuant to the rules made by the Central Government of India, regarding the maintenance of cost records under clause (d) of subsection (1) of Section 209 of the Act.

9 In respect of statutory dues:

(A) The Company is generally regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Value Added Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess 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 Income Tax, Wealth Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty and Excise Duty were in arrears as at the end of the financial year for a period of more than six months from the date they became payable.

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

11 Based on our audit procedures and on the basis of information and explanations given by the management, the Company has not defaulted in the repayment of dues to banks, financial institutions and debentures holders during the year.

12 In our opinion and according to information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other security.

13 In our opinion the Company is not a Chit Fund, Nidhi or Mutual Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of the CARO, 2003 are not applicable to the Company.

14 The Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the order are not applicable.

15 In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bankorfinancial institutions.

16 In our opinion and according to information and explanation given to us, the term loans have been applied for the purpose for which they were raised.

17 According to the information and explanations given to us and on overall examination of balance sheet, we report that no funds raised on short term basis have been used for long term investment.

18 According to the information and explanation given to us, the Company has not made any preferential allotment of shares to any party during this year.

19 According to the information and explanation given to us, the Company has not issued debentures.

20 The Company has not raised money by any public issues during the year.

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

For PC. MODI & CO.

Chartered Accountants

FRN 000239C

Place : JAIPUR.

Date : 27th May 2013 (CA RAKESH KEDIA)

Partner

Membership No.- 076420


Mar 31, 2012

1. We have audited the attached Balance Sheet of KG PETROCHEM LIMITED as at 31st March 2012, the Statement of Profit and Loss and also Cash Flow Statement 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 misstatements. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the company, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 issued by Central Government of India in terms of sub- section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraph 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to above, 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 purposes of our audit.

ii) In our opinion, proper books of accounts as required by the law have been kept by the company as far as appears from our examination of those books.

iii) The Balance Sheet, Statement of Profit and Loss , and Cash Flow Statement dealt with by this report are in agreement with the books of accounts.

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

v) On the basis of the written representations received from the directors as on 31st March 2012 and taken on record by the Board of Directors, we report that none of the director is disqualified from being appointed as Director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956 as on 31st March 2012.

vi) Attention is drawn that Sales have been accounted for as soon as material is dispatched from factory gate as per Accounting Policy No.1.4 of Note No. 1 of the Financial statements.

vii) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information as required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In the case of Balance Sheet, of the state of affairs as at 31st March, 2012;

b) In the case of 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.

ANNEXURE TO THE AUDITOR'S REPORT

Statement referred to in paragraph (3) of our report of even date to the members of the KG PETROCHEM LTD. on the accounts for theyearended 31st March 2012.

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

(b) According to the information and explanations given to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which, in our opinion is reasonable, having regard to the size of the company and nature of the assets. No material discrepancies were noticed on such verification.

(c) During the year, Company has not disposed off any substantial /major part of fixed assets; hence the going concern status of the company is not affected.

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

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

(c) The company is maintaining proper records of the inventory. The discrepancies noticed by the management on verification between the physical stocks and the book records were not material.

(iii) (a) The company has not granted any unsecured loan to companies, firms or other parties overed in the register maintained u/s 301 of the Companies Act, 1956. Accordingly clause 4 (iii) (a) to (d) of the Companies (Audior's Report) Order, 2003 are not applicable.

(b) Unsecured loans taken from 2 (Two) persons covered in the register maintained under section 301 of the Companies Act, 1956 amounting to Rs. 148.00 Lacs outstanding at the year end and the maximum amount involved is Rs. 148.00 Lacs.

(c) Interest and other terms and condition of loan taken are not prima facie prejudicial to the interest of the company.

(d) Company is regular in payment of principal amount and interest.

(iv.) In our opinion and according to the information and explanations given to us, there are adequate internal

control procedures commensurate with the size of the company and nature of its business with regard to the purchase of inventories, fixed assets, other assets and with regard to sale of goods. During the course of our audit, we have not observed any major weakness in internal controls

(v.) (a) On the basis of checks carried out by us and according to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been entered. (b) In our opinion and according to the explanations and information given to us, the transactions in pursuance of the contracts or arrangements entered in the register maintained under section 301 of the companies Act, 1956 and exceeding the value of rupees five lacs in respect of a party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) According to the information and explanations given to us, company has not accepted deposits under provisions of Sections 58A and of the Companies Act, 1956.

(vii) In our opinion the company has internal audit system commensurate with the size and nature of its business.

(viii) According to information and explanation given to us, prima facie the company has maintained the cost records in respect of the products manufactured by it, as prescribed by Central Government under Section 209(l)(d)of the Companies Act 1956.

(ix) (a) According to the records examined by us the company is generally regular in depositing with appropriate authorities all applicable undisputed statutory dues including Provident Fund, Investor Education & Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess & any other statutory dues applicable to it.

According to the information and explanations given to us there were no undisputed amount payable in respect of Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess & any other statutory dues were in arrears, as at 31.03.12 for the period of more than six months from the date they became payable. (b) According to the information and explanations given to us, there are no dues of Sales tax, Income tax, Customs duty, Wealth tax, Excise duty, Service tax & cess which have not been deposited on account of any dispute except the following.

Period to which Forum Nature of Statue Nature of Amount the amount whivh Dues (In Rs.) relates (F.Y.) dispute pending

Sercive Tax, 1961 Service 37,35,730/- 2005-06 to 2008-09 CESTAT

Central Excise Act, 1944 Excise Duty 2,43,190/- 2001-02 to 2004-05 CESTAT (Upto Feb-05)

(x) There are no accumulated losses at the end of the financial year. Therefore, the provisions of clause 4 (x) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to any financial institutions or bank.

(xii) According to the information and explanations given to us, the company has not granted any loans and advances on the basis of security byway of pledge of shares, debentures and other securities.

(xiii) The company is not a chit fund or a nidhi/mutual benefit society. Therefore, the provisions of clause 4 (xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xiv) The company is not dealing in or trading in the shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xv) According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) In our opinion and according to the information and explanation given to us, the company has prima facie applied the sum raised on term loans for the purposes for which the loans were obtained.

(xvii) According to the records examined by us and information and explanations given to us and on overall examination of Balance Sheet and Cash Flow Statement of the company, we report that no funds raised on short-term basis have been used for long-term investments.

(xviii) The company has not made any allotment of shares to the parties covered in register maintained under section 301 oftheCompaniesAct, 1956.

(xix) The company has not issued debentures during the year.

(xx) The company has not raised any money through public issue during the year.

(xxi) To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For KALANI & COMPANY,

Chartered Accountants

FRN 000722C Place : JAIPUR.

Date : 28th May 2012

[K.L.J HAN WAR]

Partner

M.No.14080


Mar 31, 2010

1. We have audited the attached Balance Sheet of KG PETROCHEM LIMITED as at 31st March 2010, the Profit and Loss Account and also Cash Flow Statement 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 misstatements. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the company, 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 of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraph 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to above, 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 purposes of our audit.

ii) In our opinion, proper books of accounts as required by the law have been kept by the company as far as appears from our examination of those books.

iii) The Balance Sheet, Profit and Loss Account, and Cash Flow Statement dealt with by this report are in agreement with the books of accounts.

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

v) On the basis of the written representations received from the directors as on 31st March 2010 and taken on record by the Board of Directors, we report that none of the director is disqualified as on 31st March 2010 from being appointed as Director in terms of clause (g) of sub-section (1) of section 274 of theCompaniesAct, 1956.

vi) Attention is drawn that Sales have been accounted for as soon as material is dispatched from factory gate as per Accounting Policy No.5 of schedule no.20 of the Financial statements.

vii) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information as required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In the case of Balance Sheet, of the state of affairs as at 31 st March, 2010;

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

ANNEXURE TO THE AUDITORS REPORT

Statement referred to in paragraph (3) of our report of even date to the members of the KG PETROCHEM LTD. on the accounts for the year ended 31 st March 2010.

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

(b) According to the information and explanations given to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which, in our opinion is reasonable, having regard to the size of the company and nature of the assets. No material discrepancies were noticed on such verification.

(c) During the year, Company has not disposed off any substantial /major part of fixed assets; hence the going concern status of the company is not affected.

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

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

(c) The company is maintaining proper records of the inventory. The discrepancies noticed by the management on verification between the physical stocks and the book records were not material.

(iii) (a)to(g)The company has not granted/taken any loans secured or unsecured to companies, firms or other parties covered in the register maintained u/s301 of the Act. Accordingly paragraph (iii) (a) to (g) is not applicable.

(iv.) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to the purchase of inventories, fixed assets, other assets and with regard to sale of goods. During the course of our audit, we have not observed any major weakness in internal controls

(v.) (a) On the basis of checks carried out by us and according to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been entered.

(b) In our opinion and according to the explanations and information given to us, the transactions in pursuance of the contracts or arrangements entered in the register maintained under section 301 of the companies Act, 1956 and exceeding the value of rupees five lacs in respect of a party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, in respect of deposits accepted, the company has complied with the provisions of Sections 58A and 58AAof the Companies Act, 1956 and the rules framed there under. Further no order has been passed by the company law board in respect of deposits accepted by the company.

(vii) In our opinion the company has internal audit system commensurate with the size and nature of its business.

(viii) According to information and explanation given to us, the central government has prescribed under Section 209(1 )(d)of the Companies Act 1956, the maintenance of the cost records in respect of its products manufacture by the company. We have broadly reviewed the books of accounts maintained and in our opinion; the prescribed accounts and records have prima facie been made and maintained by the company. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate and complete.

(ix) (a) According to the records examined by us the company is generally regular in depositing with appropriate authorities all applicable undisputed statutory dues including Provident Fund, Investor Education & Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess & any other statutory dues applicable to it.

According to the information and explanations given to us there were no undisputed amount payable in respect of Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess & any other statutory dues were in arrears, as at 31.03.10 for the period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Sales tax, Income tax, Customs duty, Wealth tax, Excise duty, Service tax & cess which have not been deposited on account of any dispute exceptthe following.



Nature of Statue Nature of Dues Amount (In Rs,) Period to which Forum Where the amount dispute is relates (F.Y.) pending

Income Tax Act, 1961 Income 98,314/- 2002-2003 CIT 1,07,026/- 1998-1999 CIT

Central Excise Act, 1944 Excise Duty 2,43,190/- 2001-02 to CESTAT 2004-05 (Upto Feb-05)



(x) There are no accumulated losses at the end of the financial year. Therefore, the provisions of clause 4

(x) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to any financial institutions or bank.

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

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

(xiv) The company is not dealing in or trading in the shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

(xv) According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) In our opinion and according to the information and explanation given to us, the company has prima facie applied the sum raised on term loans for the purposes for which the loans were obtained.

(xvii) According to the records examined by us and information and explanations given to us and on overall examination of Balance Sheet and Cash Flow Statement of the company, we report that no funds raised on short-term basis have been used for long-term investments.

(xviii) The company has not made any allotment of shares to the parties covered in register maintained under section 301 of the Companies Act, 1956.

(xix) The company has not issued debentures during the year.

(xx) The company has not raised any money through public issue during the year.

(xxi) To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.



For Kalani & Company

Chartered Accountants

FRN00722C

Place: JAIPUR. (K.L. Jhanwar)

Date :29th May 2010 Partner

(M. No. 14080)



 
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