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Auditor Report of Kopran Ltd.

Mar 31, 2015

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and the 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 financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statement.

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

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, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note 43 of the financial statements, whereby the management is of the opinion that no provision is required in respect of investment made in the subsidiary company Kopran Research Laboratories Limited for reasons stated there in. Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1 As required by Companies (Auditors Report) order 2015 issued by 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 purposes of our audit.

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

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

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

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

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

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

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

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

Annexure to the Independent Auditor''s Report (Referred to in paragraph 1 under ''Report on other legal and Regulatory requirements'' section of our report of even date)

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

(b) As explained to us, fixed assets are physically verified by the management in a phased periodical manner 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 verification.

(ii) (a) Physically verification of inventory has been conducted by the management at year end.

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

(c) The Company is maintaining proper records of inventory. Discrepancies noted on physical verification of inventories were not material, and have been properly dealt with in the books of account.

(iii) The company has granted unsecured loan to its subsidiary covered in the register maintained under section 189 of the Companies Act.

(a) The loans granted are re-payable on demand. We are informed that the company has not demanded repayment of the loan outstanding during the year, and thus, there has been no default on the part of the said subsidiary to which the money has been lent. The loan granted is interest free. (also refer ''Emphasis of matter'' paragraph in the audit report)

(b) There is no overdue amount of loan granted to subsidiary company listed in the register maintained under section 189 of the Companies Act, 2013.

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

(v) The Company has not accepted any deposits during the year within the meaning of the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013 and are of the opinion that prima-facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(vii) (a) The company is generally regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, there are no undisputed dues in respect of income-tax, which were outstanding, at the year-end for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, dues outstanding of service tax, excise duty and other statutory dues that have not been deposited on account of any dispute as follows:

Name of the Statute Nature of dues Amount For the Period

Central Excise Act Excise Duty 14.06 1998-2002, 2002-2003, 2004-2005

1.46 2011-2012 5.05 2012-2013

6.48 2012-2013, 1990-1991

Finance Act, 1994 Service Tax 507.95 2001-2002

Drug Price Difference in 591.34 2000-2003 Control Order -95 pricing

Name of the Statute Forum where the Dispute is pending

Central Excise Act Central Excise and Service Tax Appellate Tribunal

Commissioner of Central Excise (Appeal)

Joint Secretary of Government of India Ministry of Finance

Commissioner of Central Excise

Finance Act 1994 High Court (Mumbai)

Drug Price Control High Court (Mumbai) Order 95

(c) There are no amounts required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.

(viii) The Company''s accumulated losses at the end of the financial year are less than fifty per cent of its net worth and it has not incurred cash losses in the current and immediately preceding financial year.

(ix) Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to bank. There were no outstanding dues to any financial institution or debenture holders anytime during the year.

(x) The company has not given any guarantee for loans taken by others from bank or financial institutions.

(xi) Based on information and explanation given to us, the term loans were applied for the purpose for which loans were obtained.

(xii) Based on the audit procedures performed and as per the information and explanation given by the management we report that no material fraud on or by the company has been noticed or reported during the year.

For BATLIBOI & PUROHIT Chartered Accountants ICAI Firm Registration No. 101048W

Kaushal Mehta Place : Mumbai Partner Date : 28th May, 2015 Membership No.111749


Mar 31, 2014

We have audited the accompanying financial statements of KOPRAN LIMITED ("the Company"), which comprise the Balance Sheet as at 31 March, 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") read with 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 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 entity''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.

Basis for qualified opinion

Attention is invited to Note 31 to the financial statements regarding the investment and advances aggregating to Rs. 500.61 lakhs and Rs. 4,729.02 lakhs respectively, given to subsidiary company, Kopran Research Laboratories Limited, whose accumulated losses have exceeded the networth. No provision for investments and doubtful advances has been made by the management of the company. Consequently, the effect, if any, on the carrying value of investment and advances given cannot be ascertained. Our audit report on the financial statements for the year ended 31st March, 2013 contained a similar modification.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the basis for qualified opinion paragraph, 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 31st March, 2014;

(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 in terms of section 227(4A) of the companies Act, 1956, we give in the annexure a statement on the matters specified in paragraphs 4 and 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 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;

(bb) The company does not have any branch auditor; hence clause (c) of sub-section (3) of section 228 of the Companies Act 1956 is not applicable;

(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 subsection (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.

ANNEXURE TO THE AUDITOR''S REPORT

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

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

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

(c) There was no substantial disposal of fixed assets during the year.

(ii) (a) The inventories have been physically verified by the management during the year. In our opinion, having regard to the nature and location of stocks, the frequency of the physical verification is reasonable.

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

(c) The Company has maintained proper records of inventory. The discrepancies noticed on verification between book records and physical stock of inventory, were not material and have been properly dealt with in the books of accounts.

(iii) (a) The Company has granted loan, to its wholly owned subsidiary, covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 4,793.92 lakhs and the year- end balance of loans granted to such party was Rs. 4,729.02 lakhs (Also refer matter described in the Basis for qualified opinion paragraph)

(b) In our opinion and according to the information and explanations given to us, the loan referred in clause (iii) (a) above is interest free and other terms and conditions for such loan are not prima facie prejudicial to the interest of the Company.

(c) The loan granted to the above party is long term in nature, without any stipulation in respect of repayment of principal amount.

(d) In respect of overdue amount of loans granted to the above party listed in the register maintained under section 301 of the Companies Act, 1956 refer our comments in matter described in the Basis for qualified opinion paragraph.

(e) The Company has taken loan from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the period under audit was Rs. 5,660.45 lakhs and the year-end balance of loan taken from such parties was Rs. 5,297.31 lakhs.

(f) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for such loans are not prima facie prejudicial to the interest of the Company. Loan taken from one party is interest free.

(g) In respect of loans taken, repayment of principal amount is as stipulated and the payment of interest has been regular.

(iv) In our opinion and according to the information and explanation given to us, there are adequate internal control systems commensurate with size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control systems in respect of these areas.

(v) In respect of the contract or arrangements entered in the register maintained in pursuance of section 301 of the Companies Act, 1956 to the best of our knowledge and belief and according to the information and explanation given to us:

(a) The particulars of contracts or arrangements referred to in Section 301 that need to be entered in the Register maintained under the said Section have been so entered.

(b) Where each of such transactions is in excess of Rs. 5 lakhs in respect of any party and having regard to our comments in paragraph (iv) above, the transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposits during the year from the public within the meaning of the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules made there under.

(vii) The Company has an internal audit system, the scope and coverage of which, in our opinion, requires to be enlarged to commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not carried out any detailed examination of such accounts and records.

(ix) (a) According to the information and explanations given to us and based on the books as produced and examined, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it, except slight delays in few cases of service tax under reverse charge mechanism.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income tax, wealth tax, service tax, sales tax, customs duty and excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the records of the company, the dues outstanding of income tax, excise duty and service tax on account of any dispute are as follows:

Name of the Statute Nature of dues Amount For the Period (Rs in Lakhs)

Central Excise Act Excise Duty 17.21 1998-2002, 2002-2003, 2004-2005

Central Excise Act Excise Duty 1.46 2011-2012

Central Excise Act Excise Duty 5.01 2006-2007, 2010-2011 to 2012-2013

Central Excise Act Excise Duty 15.02 2011-2012

Finance Act, 1994 Service Tax 32.95 2001-2002

Finance Act, 1994 Service Tax 1.10 2006-2007

Drug Price Control Difference in 591.34 2000-2003 Order – 95 Pricing

Names of Statue Forum where the Dispute is pending

Central Excise Act Central Excise and Service Tax Appellate Tribunal

Central Excise Act Commissioner of Central Excise (Appeal)

Central Excise Act Joint Secretary of Government Of India Ministry of Finance

Central Excise Act Commissioner of Central Excise

Central Excise Act High Court (Mumbai)

Central Excise Act Commissioner of Central Excise

Central Excise Act High Court (Mumbai

(x) The Company has accumulated losses amounting to Rs. 2,498.53 lakhs as at the end of the year under Audit. However the net worth as at the end of the period under report is positive and the accumulated losses i.e. debit balance in statement of profit and loss is not more than fifty percent of its net worth. The Company has not incurred cash losses during the year under audit or in the immediately preceding financial year.

(xi) Based on our audit procedures and the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to banks or financial institutions and it has not issued any debentures.

(xii) Based on our examination of the records and the information and explanations given to us, the Company has not granted any loans and/or advances on the basis of security by way of pledge of shares, debentures and other securities.

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

(xiv) In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4 (xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) 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 bank or financial institutions.

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

(xvii) According to the information and explanations given to us and an overall examination of the Balance Sheet and Cash Flow Statement of the company, we report that funds raised on short term basis have prima facie not been used for long term investment.

(xviii) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by way of public issues during the year.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

For BATLIBOI & PUROHIT Chartered Accountants Firm Registration No. 101048W

Kaushal Mehta Partner Membership No.111749

Place : Mumbai Date : 28th May, 2014


Mar 31, 2013

Report on the financial statements

We have audited the accompanying financial statements of KOPRAN LIMITED ("the Company"), which comprise the balance sheet as at 31st March, 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 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 evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Basis for qualified opinion

attention is invited to note 31 to the financial statements regarding the investment and advances aggregating to Rs. 500.61 lakhs and Rs. 4,731.96 lakhs respectively given to subsidiary company, Kopran Research Laboratories Limited, whose accumulated losses have exceeded the net worth. No provision for investments and doubtful advances has been made by the management of the company. Consequently, the effect, if any, on the carrying value of investment and advances given cannot be ascertained. Our audit report on the financial statements for the year ended 31st March, 2012 contained a similar modification.

Qualified opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the basis for qualified opinion paragraph, 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 31st March, 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 in terms of section 227(4A) of the companies Act, 1956, we give in the annexure a statement on the matters specified in paragraphs 4 and 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 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, 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 subsection (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.

ANNEXURE TO THE AUDITOR''S REPORT

The Annexure referred to in our report to the members of Kopran Limited (''the Company'') for the year ended 31st March, 2013.

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

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

(c) There was no substantial disposal of fixed assets during the year.

(ii) (a) The inventories have been physically verified by the management during the year. In our opinion, having regard to the nature and location of stocks, the frequency of the physical verification is reasonable.

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

(c) The company has maintained proper records of inventory. The discrepancies noticed on verification between book records and physical stock of inventory, were not material and have been properly dealt with in the books of accounts.

(iii) (a) The company has granted loan, to its wholly owned subsidiary, covered in the register maintained under section 301 of the companies Act, 1956. The maximum amount involved during the year was Rs. 4,731.96 lakhs and the year- end balance of loans granted to such party was Rs. 4,731.96 lakhs (also refer matter described in the basis for qualified opinion paragraph)

(b) In our opinion and according to the information and explanations given to us, the loan referred in clause (iii) (a) above is interest free and other terms and conditions for such loan are not prima facie prejudicial to the interest of the company.

(c) The loan granted to the above party is long term in nature, without any stipulation in respect of repayment of principal amount.

(d) In respect of overdue amount of loans granted to the above party listed in the register maintained under section 301 of the companies Act, 1956 refer our comments in matter described in the basis for qualified opinion paragraph.

(e) The company has taken loan from two parties covered in the register maintained under section 301 of the companies Act, 1956. The maximum amount outstanding during the period under audit was Rs. 6,013.50 lakhs and the year-end balance of loan taken from such parties was Rs. 5,600.25 lakhs.

(f) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for such loans are not prima facie prejudicial to the interest of the company. Loan taken from one party is interest free.

(g) In respect of loans taken, repayment of principal amount is as stipulated and the payment of interest has been regular.

(iv) In our opinion and according to the information and explanation given to us, there are adequate internal control systems commensurate with size of the company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control systems in respect of these areas.

(v) In respect of the contract or arrangements entered in the register maintained in pursuance of section 301 of the companies Act, 1956 to the best of our knowledge and belief and according to the information and explanation given to us:

(a) The particulars of contracts or arrangements referred to in section 301 that need to be entered in the register maintained under the said section have been so entered.

(b) Where each of such transactions is in excess of Rs. 5 lakhs in respect of any party and having regard to our comments in paragraph (iv) above, the transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vi) The company has not accepted any deposits during the year from the public within the meaning of the provisions of section 58A, 58AA or any other relevant provisions of the companies Act, 1956 and rules made there under.

(vii) The company has an internal audit system, the scope and coverage of which, in our opinion, requires to be enlarged to commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the central government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not carried out any detailed examination of such accounts and records.

(ix) (a) According to the information and explanations given to us and based on the books as produced and examined, the company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it, except slight delays in few cases.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income tax, wealth tax, service tax, sales tax, customs duty and excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the records of the company, the dues outstanding of income tax, excise duty and service tax on account of any dispute are as follows:

Name of the Statute Nature of dues Amount ( Rs. in Lakhs)

Central excise Act Excise duty 4.39

Central excise Act Excise duty 10.32

Central excise Act Excise duty 1.16

Central excise Act Service tax 18.71

Central excise Act Service tax 32.95

Drug price control order – 95 Difference in pricing 591.34

Name For the Period Forum where the Dispute is pending

Central excise Act 1998-2002 Commissioner (appeals)

Central excise Act 2002-2003 Central excise and service tax appellate tribunal

Central excise Act 2004-2005 Central excise and service tax appellate tribunal

Central excise Act 2001-2002 Commissioner (appeals)

Central excise Act 2001-2002 High court (Mumbai)

Central excise Act 2000-2003 High court (Mumbai)

(x) The company has accumulated losses amounting to Rs. 4,229.03 lakhs as at the end of the year under audit. However the net worth as at the end of the period under report is positive and the accumulated losses i.e. debit balance in statement of profit and loss is not more than fifty percent of its net worth. The company has not incurred cash losses during the year under audit or in the immediately preceding financial year.

(xi) Based on our audit procedures and the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to banks or financial institutions and it has not issued any debentures.

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

(xiii) In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4 (xiii) of the companies (auditor''s report) order, 2003 (as amended) are not applicable to the company.

(xiv) In our opinion, the company is not dealing or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4 (xiv) of the companies (auditor''s report) order, 2003 (as amended) 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 bank or financial institutions.

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

(xvii) According to the information and explanations given to us and an overall examination of the balance sheet and cash flow statement of the company, we report that funds raised on short term basis have prima facie not been used for long term investment.

(xviii) According to the information and explanations given to us, the company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the companies Act, 1956.

(xix) The company did not have any outstanding debentures during the year.

(xx) The company has not raised any money by way of public issues during the year.

(xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For BATLIBOI & PUROHIT Chartered Accountants Firm Registration No. 101048W

Kaushal Mehta

Place : Mumbai Partner

Date : 29th May, 2013 Membership No.111749


Mar 31, 2012

1. We have audited the attached Balance Sheet of KOPRAN LIMITED ('the Company') as at 31st March 2012 and also the statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003 as amended by the Companies (Auditor's Report) (Amendment) Order, 2004 (together the said Order) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate, and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

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

c) The Balance Sheet and the statement of Profit and Loss 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 Cash Flow Statement dealt with by this report comply with all Accounting Standards referred to in section 211 (3C) of the Companies Act, 1956.

e) According to the information and explanation given to us and on the basis of written representation received from the Directors of the Company, as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2012 from being appointed as a Director under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) Attention is invited to Note 32 to the financial statements regarding Investment and Advances aggregating Rs. 500.61 lakhs and Rs. 4,682.05 lakhs respectively, given to a subsidiary company, Kopran Research Laboratories Limited whose accumulated losses have exceeded the net-worth, no provision for Investments and Doubtful advances has been made by the management of the Company. Consequently, the effect, if any, on the carrying values of investments and advances given are currently unascertainable. Our audit report on the financial statements for the year ended 31st March, 2011 was also modified in respect of the matter stated above.

g) Subject to our comments in Para 4(f) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India

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

ii) In the case of the statement of Profit and Loss, of the Profit for the year ended on that date;

iii) In the case of the cash flow statement of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in Paragraph 3 of our report of even date to the Members of Kopran Limited on the accounts for the Year ended March, 31 2012)

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

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

(c) There was no substantial disposal of fixed assets during the year.

2. (a) The management has conducted physical verification of the inventory during the year under audit.

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

(c) In our opinion and according to the information and explanations given to us, the company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

3. (a) The company has granted loans to one party covered in the register maintained under section 301 of the Companies Act, 1956. The

maximum amount involved during the period under audit was Rs. 4,885.70 lakhs and the year-end balance of loan granted to such parties was Rs. 4,682.05 lakhs.

(b) In our opinion and according to the information and explanations given to us, loans referred in clause 3(a) above is interest free and other terms and conditions for the loans is not prima facie prejudicial to the interest of the Company.

(c) In respect of loans granted, repayment of the principal amount is as stipulated and the loan given is interest free.

(d) There is no overdue amount of loans granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company has taken loan from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the period under audit was Rs. 6,356.67 lakhs and the year-end balance of loan taken from such parties was Rs. 5,763.50 lakhs.

(f) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for such loans are not prima facie prejudicial to the interest of the Company. Loan taken from one party is interest free.

(g) In respect of loans taken, repayment of principal amount is as stipulated and the payment of interest has been regular.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control systems commensurate with size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control systems in respect of these areas.

5. (a) According to the information and explanation provided by the Management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the act, that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanation given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5 lakhs or more in respect of a party has been made at price which is reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India, the provisions of Sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under apply.

7. The Company has an internal audit system, the scope and coverage of which, in our opinion, requires to be enlarged to commensurate with the size and nature of its business.

8. We have broadly reviewed the books of accounts maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However we have not carried out any detailed examination of such accounts and records.

9. (a) According to the information and explanations given to us, and on the basis of our examination of the books of account, the Company

is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, service tax, wealth tax, custom duty, excise duty, cess and other material statutory dues applicable to it, except slight delays in few cases.

(b) According to the information and explanations given to us, no undisputed dues payable in respect of Income tax, wealth tax, sales tax, service tax, custom duty, excise duty and cess are in arrears as at 31st March, 2012 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, the details of dues in respect of sales tax, income tax, service tax, customs duty, wealth tax, excise duty and cess that have not been deposited with the appropriate authorities on account of any dispute are as under:

Financial Statute Nature of Dues Forum where year Dispute is pending

1998-02 Central Excise Excise Duty Commissioner(appeals) Act

1998-2000 Central Excise Excise Duty Central Excise and Act Service Tax Appellate Tribunal

2002-03 Central Excise Excise Duty Central Excise and Act Service Tax Appellate Tribunal

2004-05 Central Excise Excise Duty Central Excise and Act Service Tax Appellate Tribunal

2001-02 Central Excise Service Tax High Court (Mumbai) Act

2000-03 Drug Price Difference in High Court (Mumbai) Control Pricing Order - 95



Financial year Amount (Rs. In lakhs)

1998-02 4.39

1998-2000 3.24

2002-03 29.03

2004-05 1.16

2001-02 32.95

2000-03 591.34

10. The Company has accumulated losses amounting to Rs. 5,408.75 lakhs as at the end of the year under Audit. However the net worth as at the end of the period under report is positive and the accumulated losses i.e. debit balance in statement of profit and loss is not more than fifty percent of its net worth. The Company has not incurred cash losses during the year under audit or in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution, bank or debentures holders.

12. Based on our examination of the records and the information and explanations given to us, the Company has not granted any loans and/or advances 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 Company or nidhi/mutual benefit fund/society. Therefore the provisions of Clause (xiii) of the Order are not applicable to the Company.

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

15. In our opinion 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 during the year.

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

17. In our opinion and according to the information and explanation given to us, and on an overall examination of the balance sheet and cash flow of the company, fund raised on short term basis have prima facie not been used during the period for long term investments.

18. According to the information and explanations given to us, during the year the company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

19. The Company does not have any outstanding debentures at the end of the period.

20. During the period covered by our audit report, the Company has not raised any money by public issues.

21. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For BATLIBOI & PUROHIT Chartered Accountants Firm Reg. No. 101048W

Kaushal Mehta Partner Membership No.111749

Place: Mumbai Date: 13th July, 201


Mar 31, 2011

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

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

3. As required by the Companies (Auditor's Report) Order, 2003 as amended by the Companies (Auditor's Report) (Amendment) Order, 2004 (together the said Order) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate, and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

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

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

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

e) According to the information and explanation given to us and on the basis of written representation received from the Directors of the Company, as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as a Director under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) Attention is invited to Note 9 of Schedule 18 regarding Investment and Advances aggregating Rs. 500.61 lakhs and Rs. 4882.62 lakhs respectively, given to a subsidiary company, Kopran Research Laboratories Limited whose accumulated losses have exceeded the net-worth, no provision for Investments and Doubtful advances has been made by the management of the Company. Consequently, the effect, if any, on the carrying values of investments and advances given are currently unascertainable. Our audit report on the financial statements for the year ended 31st March, 2010 was also modified in respect of the matter stated above.

g) Subject to our comments in Para 4(f) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India.

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2011.

ii) In the case of the Profit and Loss Account, of the Profit for the year ended on that date.

iii) In the case of the cash flow statement of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in Paragraph 3 of our report of even date to the Members of Kopran Limited on the accounts for the Year ended March, 31 2011)

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

(b) All Fixed assets have not been physically verified by the management during the year, hence, we are unable to comment on the discrepancies, if any.

(c) There was no substantial disposal of fixed assets during the year.

2. (a) The management has conducted physical verification of the inventory during the period under audit.

(b) The procedures of physical verification followed by the management need to be strengthened in relation to the size of the company and nature of its business.

(c) In our opinion and according to the information and explanations given to us the company is maintaining proper records of inventory, and no material discrepancies were noticed on physical verification.

3. (a) The company has granted loans to three parties covered in the register maintained under section 301 of the Companies Act, 1956.

The maximum amount involved during the period under audit was Rs. 6535.38 lacs and the year-end balance of loan granted to such parties was Rs. 5470.82 lacs.

(b) In our opinion and according to the information and explanation given to us, loans referred in clause 3(a) above, are interest free and there are no other terms and conditions stipulated for the said loans, hence we are unable to comment on the same.

(c) There are no covenants stipulated in respect to repayment of loans referred in clause 3 (a) above, and hence we are unable to comment on regular repayment or overdue status of the same.

(d) The Company has taken loan from one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the period under audit was Rs. 955 lacs and the year-end balance of loan taken from the party covered under section 301 is Rs. 470.38 lacs.

(e) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for such loans are not prima facie prejudicial to the interest of the Company.

(f) Loans taken are re-payable on demand. As informed, the lenders have not demanded repayment of any such loan during the year, thus, there has been no default on the part of the company. The payment of interest has been regular.

4. In our opinion, and according to the information and explanations given to us, there are adequate internal control systems commensurate with size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control systems in respect of these areas.

5. (a) According to the information and explanation provided by the Management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the act, that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanation given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs.5 lacs (Rupees Five Lacs only) or more in respect of a party has been made at price which is reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India, the provision of Sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under apply.

7. The Company has an internal audit system, the scope and coverage of which, in our opinion, requires to be enlarged to be commensurate with the size and nature of its business.

8. We have broadly reviewed the books of accounts maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However we have not carried out any detailed examination of such accounts and records.

9. (a) According to the information and explanations given to us, and on the basis of our examination of the books of account, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, service tax, wealth tax, custom duty, excise duty, cess and other material statutory dues applicable to it, except slight delays in few cases.

(b) According to the information and explanations given to us, no undisputed dues payable in respect of Income tax, wealth tax, sales tax, service tax, custom duty, excise duty and cess are in arrears as at 31st March, 2011 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, the details of dues in respect of sales tax, income tax, service tax, customs duty, wealth tax, excise duty and cess that have not been deposited with the appropriate authorities on account of any dispute are as under:

Financial year Statute Nature of Dues

2001-02 Sales Tax Act Sales Tax

1996-97 Central Excise Act Excise Duty to 2004-05

2006-07 Central Excise Act Service Tax

2000-03 Drug Price Control Order - 95 Difference in Pricing

Financial year Forum where Amount Dispute is pending (Rs. In lacs)

2001-02 Commissioner (Appeals) 39.13

1996-97 Central Excise and Service 13.77 to Tax Appellate Tribunal 2004-05

2006-07 Commissioner (Service Tax) 93.98

2000-03 High Court (Mumbai) 591.34 10. The Company has accumulated losses amounting to Rs. 6025.50 lacs as at the end of the year under Audit. However the net worth as at the end of the period under report is positive and the accumulated losses i.e. debit balance in profit and loss account is not more than fifty percent of its net worth. The Company has not incurred cash losses during the year under audit or in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution, bank or debentures holders.

12. Based on our examination of the records and the information and explanations given to us, the Company has not granted any loans and/ or advances 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 Company or nidhi / mutual benefit fund/society. Therefore the provisions of Clause (xiii) of the Order are not applicable to the Company.

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

15. According to the information and explanations given to us, the terms and conditions on which the Company has given guarantee for loans taken by others from bank or financial institutions are not prejudicial to the interest of the Company.

16. In our opinion and according to the information and explanations given to us, the Term Loans raised by the Company have been applied for the purpose for which they were raised.

17. In our opinion and according to the information and explanation given to us, and on an overall examination of the balance sheet and cash flow of the company, fund raised on short term basis have prima facie not been used during the period for long term investments.

18. According to the information and explanations given to us, the company has made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. In our opinion, the price at which shares have been issued is not prejudicial to the interest of the company.

19. The Company does not have any outstanding debentures at the end of the period.

20. During the period covered by our audit report, the Company has not raised any money by public issues.

21. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For BATLIBOI & PUROHIT Chartered Accountants Firm Regn No. 101048W

K. A. MEHTA Partner Membership No. 111749

Place : Mumbai Date : 29th July, 2011




Mar 31, 2010

1. We have audited the attached Balance Sheet of KOPRAN LIMITED (the Company) as at 31st March 2010 and also the Profit and Loss Account and the Cash Flow Statement of the Company for the Year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together the said Order) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate, and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

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

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

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

e) According to the information and explanation given to us and on the basis of written representation received from the Directors of the Company, as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2010 from being appointed as a Director under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) Attention is invited to the following notes:

i) Note 9 of Schedule 18 regarding Investment and Advances aggregating Rs.500.61 lakhs and 5612.43 lakhs respectively given to a subsidiary company, Kopran Research Laboratories Limited, where no provision for Investments and Doubtful advances has been made by the management of the Company.

ii) Note 10of Schedule 18 relating to Managerial Remuneration of one of the Directors, which is paid in excess of the limits specified in schedule XIII of the Companies Act, 1956 and is subject to the approval of Central Government and the shareholders.

iii) Note 18 of Schedule 18 where the balances of few sundry debtors, creditors and loans and advances are subject to confirmations and pending reconciliation. The consequent effect of the above will be considered after reconciliation.

g) Subject to our comments in Para 4(f) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010; ii) In the case of the Profit and Loss Account, of the Profit for the year ended on that date; iii) In the case of the cash flow statement of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORSREPORT (Referred to in Paragraph 3 of our report of even date to the Members of Kopran Limited on the accounts for the Year ended March, 31 2010)

1. (a) The company has not updated records showing full particulars, including quantitative details and situation of fixed assets during the year under audit.

(b) All Fixed assets have not been physically verified by the management during the year, hence, we are unable to comment on the discrepancies, if any.

(c) There was no substantial disposal of fixed assets during the year.

2. (a) The management has conducted physical verification of the inventory during the period under audit.

(b) The procedures of physical verification followed by the management need to be strengthened in relation to the size of the company and nature of its business.

(c) In our opinion and according to the information and explanations given to us the company is maintaining proper records of inventory, and no material discrepancies were noticed on physical verification.

3. (a) The company has granted loan to a company covered in the register maintained under section 301 of the Companies Act, 1956. The

maximum amount involved during the period under audit was Rs. 6435.32 lacs and the year-end balance of loan granted to such party was Rs. 5612.43 lacs.

(b) In our opinion and according to the information and explanation given to us, loans /advances referred in clause 3(a) above, are interest free and there are no other terms and conditions stipulated for the said loans / advances, hence we are unable to comment on the same.

(c) Since there are no covenants in respect to repayment of the loans /advances referred in clause 3 (a) above, we are unable to comment on regular repayment of the same.

(d) The Company has taken loan from a party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the period under audit was Rs. 72.20 crores, which has now been assigned to another party not covered in the register maintained under section 301 and the year-end balance of loan taken from the party covered under section 301 is Rs. Nil.

(e) In our opinion and according to the information and explanation given to us, loan referred in clause 3(d) above, were interest free and the other terms and conditions are not prima facie prejudicial to the interest of the Company.

(f) The loans taken from the party covered under the register maintained under section 301 were interest free during the year and have been assigned to another party.

4. In our opinion, and according to the information and explanations given to us, there are adequate internal control systems commensurate with size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control systems in respect of these areas.

5. (a) Based on the Audit procedures applied by us and according to the information and explanation provided by the Management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the act, that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanation given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs.5 lacs (Rupees Five Lacs only) or more in respect of a party has been made at price which is reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India, the provision of Sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under apply.

7. The Company has an internal audit system, the scope and coverage of which, in our opinion, requires to be enlarged to be commensurate with the size and nature of its business.

8. We have broadly reviewed the books of accounts maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However we have not carried out any detailed examination of such accounts and records.

9. (a) According to the information and explanations given to us, and on the basis of our examination of the books of account, the Company

is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, service tax, wealth 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 dues payable in respect of Income tax, wealth tax, sales tax, service tax, custom duty, excise duty and cess are in arrears as at 31st March, 2010 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, the details of dues in respect of sales tax, income tax, service tax, customs duty, wealth tax, excise duty and cess that have not been deposited with the appropriate authorities on account of any dispute are as under:

Financial year Statute Nature of dues Forum where Amount

dispute is pending (Rs. in Lacs)

2001-02 Sales Tax Act Sales Tax Commissioner (Appeals) 39.13

1996-97 Central Excise Act Excise Duty Central Excise and Service 13.77

to Tax Appellate Tribunal

2004-05

2006-07 Central Excise Act Service Tax Commissioner (Service Tax) 1015.91

2000-03 Drug Price Control Order - 95 Difference in Pricing High Court (Mumbai) 591.34

10. The Company has accumulated losses amounting to Rs. 6565.82 lacs as at the end of the year under Audit. However the net worth as at the end of the period under report is positive and the accumulated losses i.e. debit balance in profit and loss account is not more than fifty percent of its net worth. The Company has not incurred cash loss during the year under audit, however in the immediately preceding financial year the Company had incurred cash loss.

11. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution, bank or debentures holders.

12. Based on our examination of the records and the information and explanations given to us, the Company has not granted any loans and/ or advances 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 Company or nidhi/mutual benefit fund/society. Therefore the provisions of Clause (xiii) of the Order are not applicable to the Company.

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

15. According to the information and explanations given to us, the terms and conditions on which the Company has given guarantee for loans taken by others from bank or financial institutions are not prejudicial to the interest of the Company.

16. In our opinion and according to the information and explanations given to us, the Term Loans raised by the Company have been applied for the purpose for which they were raised.

17. In our opinion and according to the information and explanation given to us, and on an overall examination of the balance sheet and cash flow of the company, fund raised on short term basis have prima facie not been used during the period for long term investments.

18. According to the information and explanations given to us, the company has made preferential allotment of shares to parties and companies covered in the register;maintained under section 301 of the Act. In our opinion, the price at which shares have been issued is not prejudicial to the interest of the company.

19. The Company does riot have any outstanding debentures at the end of the period.

20. During the period covered by our audit report, the Company has not raised any money by public issues.

21. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For BATLIBOI & PUROHIT

Chartered Accountants

Firm Regn. No. 101048W

K.A. MEHTA

Place: Mumbai Partner

Date: 10th August, 2010 Membership No.111749





 
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