Auditor Report of Kiran Syntex Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of KIRAN SYNTEX LTD. ("the Company"), which comprise the Balance Sheet as at March 31, 2015, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors are responsible for the matters stated in section 134(5) of the Companies Act 2013 ("the act') with respect to preparation of these standalone financial statements that give True and Fair view of the financial position, financial performance and cash flow of the company in accordance with accounting principles generally acceptable 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 provisions of the act for safeguarding assets of the company and for preventing and detecting frauds and other irregularities, selection and applications of, appropriate accounting policies, making judgments and estimates that are reasonable and prudent, and design implementation and maintenance of adequate financial internal controls, that were operating effectively for ensuring the accuracy and completeness of accounting records,relevant for preparation and presentation of the financial statements that give a true and fair view and are free from any 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 consideration the provisions of the act, the accounting and auditing standards, and matters which are required to be included in the auditors report under the provisions of the act and rules made thereunder. We conducted audit in accordance with the standards on audits specified under section 143(10) of the act. Those standards require that we comply with ethical requirement and plan and perform audit to obtain reasonable assurance whether the financial statements are free from any 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 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 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 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 five 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 affairs of the company as at 31 st March 2015 and its loss and its cash flow for the year ended on that date

Emphasis of Matters

We draw attention to Note 29 to the financial statements which discribes about the huge demands by way of duty and penalty raised by the excise department on the company The company has challenged the said demand and penalty and has preferred an appeal before the Central Excise and Service Tax Tribunal (CESTAT) Ahmedabad.

Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order 2015,('the order') issued by the Central Government of terms of section 143 (11) of the companies act 2013. We enclose Annexure "A" statement on the matters specified in paragraph 3 & 4 of the said order, to the extent possible.

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

a. We have sought and obtained all the information & explanation 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 the 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 aforesaid standalone financial statements comply with the Accounting Standards specified under section 133 of the act read with Rule7 Companies (accounts) Rule2014

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

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

i) The company has disclosed the impact of pending litigations in on its financial position in its financial statements. Refer note no.29 to the financial statements.

ii) The company did not have any long term contracts including derivative contracts for which there were any for seable losses

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

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT

The Annexure referred to our Independent Auditor's Report to the members of the company on the standalone financial statements for the year ended on 31st March 2015, we report that-

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

(b) As explained to us the Management has carried out physical verification of these assets and no major discrepancies are noticed. on such verification. In our opinion the periodicity of physical verification is reasonable having regard to the size of the company and nature of its assets.

(ii) (a) As per information & explanation given to us, physical verification of inventory has been carried out by the management during the year. In our opinion frequency of physical verification is reasonable considering the size of the company and nature of its business.

(b) As per informations and explanations given to us, the procedures adopted for physical verification by the management is reasonable considering the size of the company and nature of its business.

(c) The company has maintained proper records in relation to the material received and dispatched, and as explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the books records.

(iii) The company has granted unsecured loans to one body corporate covered in the register maintained under section 189 of the Companies Act 2013 (the act)

(a) There is no stipulation for payment of interest and principal amount. The amount is repayable on drained

(b) Though the laon is outstanding since a long period however there is no stipulation for repayment therefore is not considered as overdue.

(iv) In our opinion and according to the information & explanation given to us, there are adequate internal control system commensurate with the size of the company and its nature of business for the purchase of inventory and fixed assets and sale of goods and services. We have not observed major weakness in the internal control system during the course of our audit.

(v) The Company has not accepted any deposits from the public therefore this clause is not applicable.

(vi) As per information and explanations given to us the Central Government has not prescribed the maintenance of cost records under section 148 (1) of the act for the products of the company

(vii) (a) According to the information & explanations given to us, and as per our verification, the Company has been regular in depositing undisputed statutory dues like Provided Fund, ESIC, Sales Tax, Income-Tax with appropriate authorities.

According to the information & explanations given to us, No undisputed statutory dues were outstanding at the end of the year for a period of more than six months from the date they became payable.

(b) According to information and explanations given to us the company has not deposited the following dues by way of demands raised by the excise department on account of disputes

Name of the statute Nature of dues Amount (Rs)

Central Excise Excise Duty 193918908

Central Excise Excise Duty 138734616

Central Excise Excise Duty Penalty 193918908

Central Excise Excise Duty Penalty 138734616



Name of the statute Period to which Forum where the amount dispute is pending relates

Central Excise 1998 to 2003 CESTAT Appellate Tribunal

Central Excise 1998 to 2003 CESTAT Appellate Tribunal

Central Excise 1998 to 2003 CESTAT Appellate Tribunal

Central Excise 1998 to 2003 CESTAT Appellate Tribunal

(c) as per information and explanations given to us there were no amounts required to be transferred to investor education and protection fund in accordance with the relevant provisions of Companies Act 1956

(viii) At the end of the year the company has accumulated losses to the tune of Rs. 628.43 Lacs which works out to be more than fifty percent ofthe networth of the company. The company has also incurred cash losses of Rs. 19.00 Lacs in the financial year and No cash loss incurred in the immediately preceeding financial year.

(ix) As per information & explanations given to us and as per analysis of the Balance Sheet the Company has not defaulted in repayment of dues to banks, and financial institutions, The Company has not issued any debentures.

(x) As per information & explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) The Company has not taken any Term Loan during the year, hence this clause is not applicable.

(xii) As per information & explanation given to us and in our opinion no material fraud on or by the Company has been noticed or reported during the course of our audit.

For MMS& Associates Chartered Accountants FRN 110250W

Murli Somani Date : 28th May 2015 Partner Place : Surat M.N.036727

---

Mar 31, 2014

We have audited the accompanying financial statements of KIRAN SYNTEX LTD. ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards 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

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements five 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 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.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order 2003, as amended by the Companies (Auditors'' Report) (amendment) order ,2004 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we enclose in the Annexure "A" statement on the matters specified in paragraph 4 & 5 of the said order.

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

a. We have obtained all the information & explanation 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 the 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 Companies Act, 1956 ;

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 is disqualified as on 31st March 2014 from being appointed as a director in terms of clause (g) of Sub-section (1) of Section 274 of the Companies Act, 1956;

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due or payable by the Company.

ANNEXURE TO THE AUDITOR''S REPORT

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

(b) As explained to us the Management has carried out physical verification of these assets and no major discrepancies are noticed.

(c) No substantial part of Fixed Assets are disposed off during the year. Hence the going concern status of the company is not affected.

2. (a) As per information & explanation given to us, physical verification of inventory has been carried out by the management during the year. In our opinion frequency of physical verification is reasonable considering the size of the company and nature of its business.

(b) As per informations and explanations given to us, the procedures adopted for physical verification by the management is reasonable considering the size of the company and nature of its business.

(c) The company has maintained proper records in relation to the material received and despatched, and as explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the books records.

3. (a) As per explanation & information given to us, company has taken and granted unsecured loan from and to the parties covered in the register maintained U/S 301 of the Companies Act, 1956.

Details of such loan as at the end of the year are as under:

Loan Taken Loan Granted

No. of the Parties Nil 1

Amount () Nil -10,414,415

(b) In our opinion and as per explanation & information given to us, the rate of interest wherever applicable and other terms and conditions are not prima facie prejudicial to the interest of the Company.

(c) As per explanation & information given to us, payment of principal and interest of loans are as per stipulation.

(d) There is no overdue amount in respect of loans taken by the Company. In respect of loans given by the company, loan given to Sudershan Texprint Pvt Ltd. '' 104.14 lacs is outstanding since long.

4. In our opinion and according to the information & explanation given to us, there are adequate internal control procedures commensurate with the size of the company and its nature of business for the purchase of material, fixed assets and sale of goods. We have not observed any major weakness in the internal control system.

5. (a) As per explanation & information given to us, the transactions that need to be entered into a register in pursuance of Sec. 301 of the Companies Act, 1956 have been so entered.

(b) As per explanation & information given to us, we are of the opinion that these transactions have been entered at price which are reasonable having regard to the prevailing market prices at relevant time.

6. The Company has not accepted any deposits from the public therefore this clause is not applicable.

7. In our opinion the Internal Audit System of the Company is commensurate with size and nature of its business.

8. As per information & explanation given to us, maintenance of cost records under clause (d) of the sub-section (1) of setion 209 is not applicable to the Company.

9. (a) According to the informations & explanations given to us, and as per our verification, the Company has been regular in depositing undis -puted statutory dues like Provident Fund, ESIC, Sales Tax, Income-Tax with appropriate authorities.

(b) According to the informations & explanations given to us, No undisputed statutory dues were outstanding at the end of the year for a period of more than six months from the date they became payable.

(c) i) The Excise deptt has raised demand of Rs.1939.19 Lacs and Rs.1387.35 on the company for the period from 1998 to 2003 and has also imposed penalty of equal amount. The company has disputed the said demand in Tribunal and in the opinion of the management the liability will be deleted. The management has not proposed any provision in the books for the said demand raised by the Excise Department.

10. At the end of the year the company has accumulated losses to the tune of '' 606.69 Lacs which works out to be more than fifty percent of the networth of the company.

11. As per information & explanations given to us and as per analysis of the Balance Sheet the Company has not defaulted in repayment of dues to banks, and financial institutions. The Company has not issued any debentures.

12. In our opinion and as per information & explanations given to us, the Company has not granted any loans & advances, on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a Chit Fund, Nidhi or Mutual Benefit Fund or Society, Accordingly Clause 4(xiii) is not applicable to the Company.

14. According to the informations & explanations given to us, the company is not dealing or trading in shares, securities, debentures or other investments, hence this clause is not applicable.

15. As per informations & explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. The Company has not taken any Term Loan during the year, hence this clause is not applicable.

17. According to the informations and explanations given to us and as per verification of the annual accounts, the Company has not used short term funds for long term purposes. The surplus generated by way of cash profit has been ploughed back into the business.

18. The Company has not issued any shares during the year under review..

19. The Company has not issued any debentures hence this clause is not applicable to Company.

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

21. As per information & explanation given to us and in our opinion no fraud on or by the Company has been noticed

For M M S & Associates Chartered Accountants (F.R.No.: 110250W)

Murli Somani Place : Surat Partner Date : May 28, 2014. Membership No. 36727

---

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of KIRAN SYNTEX LTD. ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards 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

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements five 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 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.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order 2003, as amended by the Companies (Auditors'' Report) (amendment) order ,2004 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we enclose in the Annexure "A" statement on the matters specified in paragraph 4 & 5 of the said order.

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

a. We have obtained all the information & explanation 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 the 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 Companies Act, 1956 ;

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 is 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 Companies Act, 1956;

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due or payable by the Company.

ANNEXURE TO THE AUDITOR''S REPORT

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

(b) As explained to us the Management has carried out physical verification of these assets and no major discrepancies are noticed.

(c) No substantial part of Fixed Assets are disposed off during the year. Hence the going concern status of the company is not affected.

2. (a) As per information & explanation given to us, physical verification of inventory has been carried out by the

management during the year. In our opinion frequency of physical verification is reasonable considering the size of the company and nature of its business.

(b) As per informations and explanations given to us, the procedures adopted for physical verification by the management is reasonable considering the size of the company and nature of its business.

(c) The company has maintained proper records in relation to the material received and despatched, and as explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the books records.

3. (a) As per explanation & information given to us, company has taken and granted unsecured loan from and to the parties covered in the register maintained U/S 301 of the Companies Act, 1956.

Details of such loan as at the end of the year are ad under:

Loan Taken Loan Granted

No. of the Parties Nil 2

Amount (Rs.) Nil 11,109,415

(b) In our opinion and as per explanation & information given to us, the rate of interest wherever applicable and other terms and conditions are not prima facie prejudicial to the interest of the Company.

(c) As per explanation & information given to us, payment of principal and interest of loans are as per stipulation.

(d) There is no overdue amout in respect of loans taken by the Company. In respect of loans given by the company, it has been explained to us, that these loan are repayable on demand and therefore the question of overdue amount does not arise.

4. In our opinion and according to the information & explanation given to us, there are adequate internal control procedures commensurate with the size of the company and its nature of business for the purchase of material, fixed assets and sale of goods. We have not observed any major weakness in the internal control system.

5. (a) As per explanation & information given to us, the transactions that need to be entered into a register in pursuance of Sec. 301 of the Companies Act, 1956 have been so entered.

(b) As per explanation & information given to us, we are of the opinion that these transactions have been entered at price which are reasonable having regard to the prevailing market prices at relevant time.

6. The Company has not accepted any deposits from the public therefore this clause is not applicable.

7. In our opinion the Internal Audit System of the Company is commensurate with size and nature of its business.

8. As per information & explanation given to us, maintenance of cost records under clause (d) of the sub-section (1) of section 209 is not applicable to the Company.

9. (a) According to the informations & explanations given to us, and as per our verification, the Company has been regular in depositing undisputed statutory dues like Provident Fund, ESIC, Sales Tax, Income-Tax with appropriate authorities.

(b) According to the informations & explanations given to us, No undisputed statutory dues were outstanding at the end of the year for a period of more than six months from the date they became payable.

(c) i) The Excise deptt has raised liability of duty amounting to Rs 1387 Lacs on the company for the period from 1998 to 2003 . The company has disputed the said demand in Tribunal and the CESTAT ( Ahmedabad) has remanded back the said case with relief on the limitation period.

10. At the end of the year the company has accumulated losses to the tune of Rs. 619.61 Lacs which works out to be more than fifty percent of the networth of the company.

11. As per information & explanations given to us and as per analysis of the Balance Sheet the Company has not defaulted in repayment of dues to banks, and financial institutions. The Company has not issued any debentures.

12. In our opinion and as per information & explanations given to us, the Company has not granted any loans & advances, on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a Chit Fund, Nidhi or Mutual Benefit Fund or Society, Accordingly Clause 4(xiii) is not applicable to the Company.

14. According to the informations & explanations given to us, the company is not dealing or trading in shares, securities, debentures or other investments, hence this clause is not applicable.

15. As per informations & explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. The Company has not taken any Term Loan during the year, hence this clause is not applicable.

17. According to the informations and explanations given to us and as per verification of the annual accounts, the Company has not used short term funds for long term purposes. The surplus generated by way of cash profit has been ploughed back into the business.

18. The Company has not issued any shares during the year under review..

19. The Company has not issued any debentures hence this clause is not applicable to Company.

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

21. As per information & explanation given to us and in our opinion no fraud on or by the Company has been noticed or reported during the year.

For M M S & Associates

Chartered Accountants

Murli Somani

Place:Surat Partner

Date :May 28, 2013 Membership No. 36727

---

Mar 31, 2012

We have audited the attached Balance Sheet of KIRAN SYNTEX LIMITED, as at 31st March 2012 and the Profit & Loss account of the company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company s Management. Our responsibility is to express an opinion on these financial statements based on our Audit.

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

As required by the Companies (Auditors Report) Order 2003, as amended by the Companies (Auditors Report) (amendment) order ,2004 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we enclose in the Annexure "A" statement on the matters specified in paragraph 4 & 5 of the said order.

Further to our comments in Annexure "A" referred to in paragraph above.

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

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

iii) The said Balance Sheet and Profit & Loss accounts dealt with by this report are in agreement with the books of account ;

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 the Companies Act, 1956 ;

v) On the basis of written representations received from the directors as on 31st March 2012, we report that none of the directors is disqualified as on 31st March 2012 from being appointed as a director in terms of clause (g) of Sub-section (1) of Section 274 of the Companies Act, 1956 ;

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

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

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

ANNEXURE TO THE AUDITOR S REPORT

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

(b) As explained to us the Management has carried out physical verification of these assets and no major discrepancies are noticed.

(c) No substantial part of Fixed Assets are disposed off during the year. Hence the going concern status of the company is not affected.

2. (a) As per information & explanation given to us, physical verification of inventory has been carried out by the management during the year. In our opinion frequency of physical verification is reasonable considering the size of the company and nature of its business.

(b) As per informations and explanations given to us, the procedures adopted for physical verification by the management is reasonable considering the size of the company and nature of its business.

(c) The company has maintained proper records in relation to the material received and despatched, and as explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the books records.

3. (a) As per explanation & information given to us, company has taken and granted unsecured loan from and to the parties covered in the register maintained U/S 301 of the Companies Act, 1956.

Details of such loan as at the end of the year are ad under:

Loan Taken Loan Granted

No. of the Parties Nil 2

Amount (Rs.) Nil 15,202,412

(b) In our opinion and as per explanation & information given to us, the rate of interest wherever applicable and other terms and conditions are not prima facie prejudicial to the interest of the Company.

(c) As per explanation & information given to us, payment of principal and interest of loans are as per stipulation.

(d) There is no overdue amout in respect of loans taken by the Company. In respect of loans given by the company, it has been explained to us, that these loan are repayable on demand and therefore the question of overdue amount does not arise.

4. In our opinion and according to the information & explanation given to us, there are adequate internal control procedures commensurate with the size of the company and its nature of business for the purchase of material, fixed assets and sale of goods. We have not observed any major weakness in the internal control system.

5. (a) As per explanation & information given to us, the transactions that need to be entered into a register in pursuance of Sec. 301 of the Companies Act, 1956 have been so entered.

(b) As per explanation & information given to us, we are of the opinion that these transactions have been entered at price which are reasonable having regard to the prevailing market prices at relevant time.

6. The Company has not accepted any deposits from the public therefore this clause is not applicable.

7. There is no formal Internal Audit System in the company , it has been explained to us that internal Audit is carried out by the staff of the company itself.

8. As per information & explanation given to us, maintenance of cost records under clause (d) of the sub-section (1) of section 209 is not applicable to the Company.

9. (a) According to the informations & explanations given to us, and as per our verification, the Company has been regular in depositing undisputed statutory dues like Provident Fund, ESIC, Sales Tax, Income-Tax with appropriate authorities.

(b) According to the informations & explanations given to us, No undisputed statutory dues were outstanding at the end of the year for a period of more than six months from the date they became payable. -

(c) i) The Excise deptt has raised liability of duty amounting to ft* ,387 Lacs on the company for the period from 1998 to 2003 . The company has disputed the said demand in Tribunal and the CESTAT ( Ahmedabad) has remanded back the said case with relief on the limitation period.

ii) The Company has also disputed liability of Rs 26.87 lacs raised by the Provident Fund department. The Company has filled a petition before High Court ( Gujarat) for the same

10. At the end of the year the company has accumulated losses to the tune of Rs. 620.47 Lacs which works out to be more than fifty percent of the networth of the company.

11. As per information & explanations given to us and as per analysis of the Balance Sheet the Company has not defaulted in repayment of dues to banks, and financial institutions. The Company has not issued any debentures.

12. In our opinion and as per information & explanations given to us, the Company has not granted any loans & advances, on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a Chit Fund, Nidhi or Mutual Benefit Fund or Society, Accordingly Clause 4(xiii) is not applicable to the Company.

14. According to the informations & explanations given to us, the company is not dealing or trading in shares, securities, debentures or other investments, hence this clause is not applicable.

15. As per informations & explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. As per informations & explanations given to us, Term Loans obtained during the year has been applied for the purpose for which the loan were obtained.

17. According to the informations and explanations given to us and as per verification of the annual accounts, the Company has not used short term funds for long term purposes. The surplus generated by way of cash profit has been ploughed back into the business.

18. The Company has not issued any shares during the year under review..

19. The Company has not issued any debentures hence this clause is not applicable to Company.

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

21. As per information & explanation given to us and in our opinion no fraud on or by the Company has been noticed or reported during the year.

For MMS & Associates

Chartered Accountants

Murli Somani

Place : Surat Partner

Date : 24.08.2012 Membership No. 36727

---

Mar 31, 2011

We have audited the attached Balance Sheet of KIRAN SYNTEX LTD., as at 31st March 2011 and the Profit & Loss account of the company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our Audit.

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

As required by the Companies (Auditors Report) Order 2003, as amended by the Companies (Auditors' Report) (amendment) order ,2004 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we enclose in the Annexure "A" statement on the matters specified in paragraph 4 & 5 of the said order.

Further to our comments in Annexure "A" referred to in paragraph above.

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

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

iii) The said Balance Sheet and Profit & Loss accounts dealt with by this report are in agreement with the books of account;

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 the Companies Act, 1956 ;

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

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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2011; and

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

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

(b) As explained to us the Management has carried out physical verification of these assets and no major discrepancies are noticed.

(c) There is no disposition of fixed assets during the year, hence the going concern status of the company is not affected.

2. (a) As per information & explanation given to us, physical verification of inventory has been carried out by the management during the year. In our opinion frequency of physical verification is reasonable considering the size of the company and nature of its business.

(b) As per information's and explanations given to us, the procedures adopted for physical verification by the management is reasonable considering the size of the company and nature of its business.

(c) The company has maintained proper records in relation to the material received and dispatched, and as explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the books records.

3. (a) As per explanation & information given to us, company has taken and granted unsecured loan from and to the parties covered in the register maintained U/S 301 of the Companies Act, 1956.

Details of such loan as at the end of the year are as under:

Loan Taken Imp Granted

No. of the Parties Nil 3

Amount (Rs.) Nil 17,138,796

(b) In our opinion and as per explanation & information given to us, the rate of interest wherever applicable and other terms and conditions are not prima facie prejudicial to the interest of the Company.

(c) There is no overdue amount in respect of loans taken by the Company. In respect of loans given by the company, it has been explained to us, that these loan are repayable on demand and therefore the question of overdue amount does not arise. However, during the year no transaction have been taken place in the advances made by the company to its associate concerns.

4. In our opinion and according to the information & explanation given to us, there are adequate internal control procedures commensurate with the size of the company and its nature of business for the purchase of material, fixed assets and sale of goods. We have not observed any major weakness in the internal control system.

5. (a) As per explanation & information given to us, the transactions that need to be entered into a register in pursuance of Sec. 301 of the Companies Act, 1956 have been so entered.

(b) As per explanation & information given to us, we are of the opinion that these transactions have been entered at price which are reasonable having regard to the prevailing market prices at relevant time.

6. The Company has not accepted any deposits from the public therefore this clause is not applicable.

7. As explained to us the company has in-house internal audit system and in our opinion the internal audit system of the company is commensurate with the size and nature of the business of the company.

8. As per information & explanation given to us, maintenance of cost records under clause (d) of the sub-section (1) of section 209 is not applicable to the Company.

9. (a) According to the information's & explanations given to us, and as per our verification, the Company has been regular in depositing undisputed statutory dues like Provident Fund, ESIC, Sales Tax, Income- Tax with appropriate authorities.

(b) According to the information's & explanations given to us, no amount is outstanding at the end of the year for a period of more than 6 months from the date they become payable.

(c) According to the information's & explanations given to us, there are no statutory dues of Sales Tax, Income Tax or Excise Duty, outstanding which were not deposited on account of any dispute.

10. At the end of the year the company has accumulated losses to the tune of Rs. 626.46 Lass which works out to be more than fifty percent of the net worth of the company.

11. As per information & explanations given to us and as per analysis of the Balance Sheet the Company has not defaulted in repayment of dues to banks, and financial institutions. The Company has not issued any debentures.

12. In our opinion and as per information & explanations given to us, the Company has not granted any loans & advances, on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a Chit Fund, Niche or Mutual Benefit Fund or Society.

14. According to the information's & explanations given to us, the company is not dealing or trading in shares, securities, debentures or other investments.

15. As per information's & explanations given to us, the Company has not given any corporate guarantee

16. As per information's & explanations given to us, no term loan has been raised by the company during the year.

17. According to the information's and explanations given to us and as per verification of the annual accounts, the Company has not used short term funds for long term purposes. The surplus generated by way of cash profit has been ploughed back into the business.

18. The Company has not issued any shares during the year under review..

19. The Company has not issued any debentures hence this clause is not applicable to Company.

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

21. As per information & explanation given to us and in our opinion no fraud on or by the Company has been noticed or reported during the year.

for M.M S & ASSOCIATES

Chartered Accountants,

(MURLISOMANI)

PLACE: SURAT Partner.

DATE : August 27, 2011 (M.N0.36727)

---

Mar 31, 2010

We have audited the attached Balance Sheet of KIRAN SYNTEX LTD., as at 31st March 2 010 and the Profit & Loss account of the company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our Audit.

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

As required by the Companies (Auditors Report) Order 2003, as amended by the Companies (Auditors Report) (amendment) order ,2004 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 we enclose in the Annexure "A" statement on the matters specified in paragraph 4 & 5 of the said order.

Further to our comments in Annexure "A" referred to in paragraph above.

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

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

iii) The said Balance Sheet and Profit & Loss accounts dealt with by this report are in agreement with the books of account;

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 the Companies Act, 1956 ;

v) On the basis of written representations received from the directors as on 31st March 2010, we report that none of the directors is disqualified as on 31st March 2010 from being appointed as a director in terms of clause (g) of Sub-section (1) of Section 274 of the Companies Act, 1956 ;

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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2010; and b) In the case of the Profit & Loss account, of the Profit of the Company for the year ended on that date.



ANNEXURE TO THE AUDITORS REPORT



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

(b) As explained to us the Management has carried out physical verification of these assets and no major discrepancies are noticed.

(c) The Company has disposed off all the Assets during the previous year and have started business by getting the yoods processed from third parties on job work basis, In our opinion the going concern status of the company as a Manufacturing concern has affected by this, however with continuation of trading activities the going concern status is continued as trading company

2. (a) As per information & explanation given to us, physical verification of inventory has been carried out by the management during the year. In our opinion frequency of physical verification is reasonable considering the size of the company and nature of its business.

(b) As per informations and explanations given to us, the procedures adopted for physical verification by the management is reasonable considering the size of the company and nature of its business.

(c) The company has maintained proper records in relation to the material received and despatched, and as explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the books records.

3. (a) As per explanation & information given to us, company has taken and granted unsecured loan from and to the parties covered in the register maintained U/S 301 of the Companies Act, 1956. Details of such loan as at the end of the year are as under:

Loan Taken Loan Granted

No. of the Parties NIL NiL

Amount (Rs.) NiL NiL

(b) In our opinion and as per explanation & information given to us, the rate of interest wherever applicable ana other terms and conditions are not prima facie prejudicial to the interest of the Company.

(c) There is no overdue amout in respect of loans taken by the Company. In respect of loans given by the company, it has been explained to us, that these loan are repayable on demand and therefore the question of overdue amount does not

4. In our opinion and according to the information & explanation given to us, there are adequate internal control procedures commensurate with the size of the company and its nature of business for the purchase of material, fixed assets and sale of goods. We have not observed any major weakness in the internal control system.

5. (a) As per explanation & information given to us, the transactions that need to be entered into a register in pursuance of Sec. 301 of the Companies Act, 1956 have been so entered.

(b) As per explanation & information given to us, ws are of the opinion that these transactions have been entered at price which are reasonable having regard to the prevailing market prices at relevant time.

6. The Company has not accepted any deposits from the public therefore this clause is not applicable.

7. In our opinion the Internal Audit System of the Company is commensurate with size and nature of i its business.

8. As per information & explanation given to us, maintenance of cost records under clause (d) of the sub-section (1) of section 209 is not applicable to the Company.

9. (a) According to the informations & explanations given to us, and as per our verification, the Company has been regular in depositing undisputed statutory dues like Provident Fund, ESIC, Sales Tax, Income-Tax with appropriate authorities.

(b) According to the informations & explanations given to us, no amount is outstanding at the end of the year for a period of more than 6 months from the date they become payable.

(c) According to the informations & explanations given to us, there are no statutory dues of Sales Tax, Income Tax or Excise Duty, outstanding which were not deposited on account of any dispute.

10. The company does not have accumulated losses more than fifty percent of its net worth and it has not incurred any cash loss during the year as well as in the immediate preceding year.

11. As per information & explanations given to us and as per analysis of the Balance Sheet the Company has not defaulted in repayment of dues to banks, and financial institutions. The Company has not issued any debentures.

12. In our opinion and as per information & explanations given to us, the Company has not granted any loans & advances, or the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a Chit Fund, Nidhi or Mutual Benefit Fund or Society.

14. According to the informations & explanations given to us, the company is not dealing or trading in shares, securities, debentures or other investments .

15. As per informations & explanations given to us, the Company has not given any corporate guarantee

16. As per informations & explanations given to us, the Company has obtained Vehicle Loan during the year.

17. According to the informations and explanations given to us and as per verification of the annual accounts, the Company has not used short term funds for long term purposes. The surplus generated by way of cash profit has been ploughed back into the business.

18. The Company has not issued any shares during the year under review..

19. The Company has not issued any debentures hence this clause is not applicable to Company.

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

21. As per information & explanation given to us and in our opinion no fraud on or by the Company has been noticed or reported during the year.

for M M S & ASSOCIATES

Chartered Accountants

(MURLI SOMANI)

Partner.

(M.N0.36727)

PLACE : SURAT

DATE .September 1,2010