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Auditor Report of Kothari Sugars & Chemicals Ltd.

Mar 31, 2023

Kothari Sugars and Chemicals Limited

REPORT ON THE AUDIT OF THE INDIAN ACCOUNTING

STANDARDS (IND AS) FINANCIAL STATEMENTS

Opinion

1. We have audited the accompanying Ind AS financial statements of Kothari Sugars and Chemicals Limited (âthe Companyâ), which comprise the balance sheet as at March 31,2023, and the statement of profit and loss (including other comprehensive income), statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Companies Act, 2013 (âthe Actâ) 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 March 31,2023, and total comprehensive income (comprising of profit after tax and other comprehensive income), changes in equity and its cash flows for the year then ended.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditorâs Responsibilities for the Audit of the Ind AS Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Ind AS financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit matters

4. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Ind AS financial statements of the current period. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

No.

Key Audit matters

Principal audit procedures

Quantity of raw materials

Significant portion of the material procurement is from individual farmers and sugarcanes are accounted on weight basis. Hence, any variance in the ascertainment of the quantity purchased may have a significant impact on the cost of materials.

Our audit procedures included:

> Assessment of controls over ascertaining the quantity of purchase for which payment is made.

> Assessment of controls over calibration system of the weighing equipment.

> Performed substantive audit procedures on cane procurement.

contingent liabilities

The Company has material amounts of disputed statutory levies such as Excise Duty, Service Tax and Electricity taxes, which have not been paid pending adjudication by the respective authority. Refer to Note 41 of the Financial Statements.

Our audit procedures included:

> Evaluation of internal controls relating to identification and evaluation of litigations involving statutory dues.

> Obtained the list of litigations and claims from the Companyâs legal team, identified material litigations from the list and performed inquiries on the managementâs evaluation of these material litigations.

> Performed an independent assessment of the conclusions reached by the management.

> Evaluated the managementâs assumptions, estimates and judgements used for calculating the provisions and contingent liabilities disclosed in the Ind AS financial statements.

Information other than the financial statements and auditor''s report thereon

5. The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Board''s Report together with the annexure thereto and Report on Corporate Governance but does not include the Ind AS financial statements and our auditor''s report thereon.

Our opinion on the Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Ind AS financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard. j

Responsibilities of management and those charged

with governance for the Ind AS financial statements

6. The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance, changes in equity 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. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

7. In preparing the Ind AS financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. The Board of Directors are also responsible for overseeing the Company''s financial reporting process.

Auditor''s responsibilities for the audit of ind AS

financial statements

8. Our objectives are to obtain reasonable assurance about whether the Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Ind AS financial statements.

9. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

â¢ Identify and assess the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

â¢ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)

(i) of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

â¢ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

â¢ Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

â¢ Evaluate the overall presentation, structure and content of the Ind AS financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

10. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

11. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

12. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Ind AS financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

13. As required by the Companies (Auditor''s Report) Order, 2020 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure B, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

14. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of Section 197(16) of the Act, as amended:

In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its Directors during the year is in accordance with the provisions of Section 197 of the Act.

15. 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 (including other comprehensive income), the Statement of Changes in Equity and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian 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 and taken on record by the Board of Directors, none of the directors are disqualified

as on March 31, 2023 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls with reference to financials statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls with reference to financial statements.

(g) 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 Note 41 to the financial statements.

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

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

(iv) (a) The Management has represented that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity (âintermediariesâ), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other

persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations as provided under (a) and (b) above, contain any material misstatement.

v. The Company has paid interim dividend during the year ending 31^st March 2023 in compliance with the provisions of section 123 of the Act. Final dividend proposed by the Board of Directors is

subject to the approval of the members in the ensuing Annual General Meeting. The dividend so proposed is in accordance with Section 123 of the Act to the extent applicable.

vi. As proviso to rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable for the Company only with effect from April 1, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 is not applicable.

Mar 31, 2021

To the members of Kothari Sugars and Chemicals Limited

REPORT ON THE AUDIT OF THE INDIAN ACCOUNTING

STANDARDS (IND AS) FINANCIAL STATEMENTS

Opinion

1. We have audited the accompanying Ind AS Financial Statements of Kothari Sugars and Chemicals Limited (âthe Companyâ), which comprise the balance sheet as at March 31,2021, and the statement of profit and loss (including other comprehensive income), statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Companies Act, 2013 (âthe Actâ) 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 March 31, 2021, and total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Ind AS Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Ind AS Financial Statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit matters

No.

Key Audit matter

Principal audit procedures

Quantity of raw materials

Significant portion of the material procurement is from individual farmers and sugarcanes are accounted on weight-basis.

Hence, any variance in the ascertainment of the quantity purchased may have a significant impact on the cost of materials.

Our audit procedures included:

> Assessment of controls over ascertaining the quantity of purchase for which payment is made.

> Assessment of controls over calibration system of the weighing equipment.

contingent liabilities

The Company has material amounts of disputed statutory levies such as Excise Duty, Customs Duty and Electricity taxes, which have not been paid pending adjudication by the respective authority. Refer to Note 42 of the Financial Statements.

Our audit procedures included:

> Evaluation of internal controls relating to assessment of ongoing litigations

> Discussion with the management on developments surrounding material ongoing litigations

> Examination of the calculations underlying the quantification of items of contingent liabilities disclosed in the financial statements.

> Evaluating the managementâs assessment of litigations and underlying assumptions.

Other Information

5. The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Board''s Report together with the annexure thereto and Report on Corporate Governance but does not include the Ind AS Financial Statements and our auditor''s report thereon.

Our opinion on the Ind AS Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Ind AS Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Ind AS Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

responsibilities of management and those charged with governance for the Ind AS financial statements

financial performance, changes in equity 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. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s responsibilities for the audit of IndAS financial

statements

8. Our objectives are to obtain reasonable assurance about whether the Ind AS Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Ind AS financial statements.

9. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

> Identify and assess the risks of material misstatement of the Ind AS Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or V he override of internal control.

> Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)

> Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

> Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

> Evaluate the overall presentation, structure and content of the Ind AS Financial Statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

12. From the matters communicated with those charged

with governance, we determine those matters that were of most significance in the audit of the Ind AS Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. J

Report on Other Legal and Regulatory Requirements

13. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure B, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

14. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of Section 197(16) of the Act, as amended:

15. 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 (including Other Comprehensive Income), the Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid Ind AS Financial Statements comply with the Indian 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 taken on record by the Board of Directors, none of the Directors are disqualified as on 31^st March 2021 from being appointed as a Director in terms of Section 164(2) of the Act.

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements in Note 42.

(ii) The Company does not have any long-term contracts including derivative contracts on which there were material foreseeable losses.

(iii) There were no amounts required to be transferred to the Investor Education and Protection Fund by the Company during the year.

Mar 31, 2018

independent auditors'' report FOR THE YEAR ENDED 31^st MARCH 2018

To the members of Kothari Sugars and Chemicals Limited

REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS

1. We have audited the accompanying Standalone Ind AS financial statements of Kothari Sugars and Chemicals Limited, (âthe Companyâ), which comprises the Balance Sheet as at 31^st March 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Managementâs Responsibility for the Standalone Ind AS Financial Statements

2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash lows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act.

3. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditorsâ Responsibility

4. Our responsibility is to express an opinion on these Standalone Ind AS financial statements based on our audit. In conducting 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 of the Standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Standalone Ind AS financial statements are free from material misstatement.

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

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

Opinion

7. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Ind AS 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 Indian Accounting Standards and accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March 2018, and its profit, total comprehensive income, its cash lows and the changes in equity for the year ended on that date.

Other Matters

8. The comparative financial information of the Company for the year ended 31^st March 2017 and the transition date opening balance sheet as at 1^st April 2016 included in these Standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by another firm of Chartered Accountants and their reports for the year ended 31^stMarch 2017 and 31^st March 2016 dated 30^th May 2017 and 27^th May 2016 respectively, expressing an unmodified opinion on those Standalone financial statements and have been restated to comply with Ind AS. Adjustments made to the previously issued said statutory financial information for the differences in the accounting principles adopted by the Company on transition to the Ind AS have been audited by us. Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) and issued by the Central Government of India in terms of sub-section 11 of Section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the said Order, to the extent applicable.

10. 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 (including Other Comprehensive Income), the Cash Flow Statement and Statement of Changes in Equity dealt with by this report are in agreement with the books of account;

(d) in our opinion, the aforesaid Standalone Ind AS financial statements, comply with the Indian Accounting Standards prescribed under Section 133 of the Act;

(e) on the basis of written representations received from the Directors as on 31^st March 2018, and taken on record by the Board of Directors, none of the Directors is disqualified as on 31^st March 2018, from being appointed as a Director in terms of Section 164 (2) of the Act;

(f) with respect to the adequacy of the internal financial controls with reference to financial statements in place and the operating effectiveness of such controls, refer to our separate report in Annexure B; and

(g) 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 explanations given to us:

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note No.43 to the Standalone Ind AS 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 required to be transferred to the Investor Education and Protection Fund by the Company during the year.

Annexure - A to Independent Auditors'' Report - 31^st March 2018 (Referred to in 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, these fixed assets have been physically verified by the Management at regular intervals; as informed to us no material discrepancies were noticed on such verification.

c) The title deeds of immovable properties are held in the name of the Company.

ii. The Management has conducted physical verification of inventory at reasonable intervals and no material discrepancies were noticed.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not provided any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.

iv. The Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of investments made by the Company. The Company has not provided any loans or guarantee or security to any company covered under Section 185 of the Companies Act, 2013.

v. The Company has not accepted any deposits from public.

vi. On the basis of the records produced to us, we are of the opinion that, prima facie, the cost records prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 have been maintained. However, we have not carried out any detailed examination of such records.

vii. According to the information and explanations given to us in respect of statutory dues:

a) the Company is regular in depositing with the appropriate authorities the undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income Tax, Service Tax, Sales Tax, Customs Duty, Excise Duty and Cess. To the best of our knowledge and according to the information and explanations given to us, there are no arrears of outstanding statutory dues as at 31^st March 2018 for a period of more than six months from the date they become payable. J

b) Details of dues of various taxes viz., Income Tax, Sales Tax, VAT, Service Tax, Customs Duty, Excise Duty not deposited as on 31^st March 2018 on account of disputes given below.

Name of the Statute	Nature of the Dues	Amount (''. lakh)	Forum where the dispute is pending	period to which the dues belong to
Central Excise Act, 1944	Excise Duty	78.69	CESTAT	1993-94 to 1996-97, 2003-04, 2006-07
Central Excise Act, 1944	Excise Duty	116.68	Assistant Commissioner, Central Excise	1996-97, 1997-98, 2010-11, 2003-04, 2004-05, 2014-15
Central Excise Act, 1944	Excise Duty	438.36	Joint/ Assistant Commissioner, Central Excise	2003-04 to 2011-12
Central Excise Act, 1944	Excise Duty	21.89	High Court, Madras	1995-96, 1998-99, 1999-2000, 2002-03
Central Excise Act, 1944	Excise Duty	128.19	Supreme Court	1995-96 to 1998-99
Central Excise Act, 1944	Excise Duty	6.57	Commissioner (Appeals), Central Excise	2014-15
Finance Act, 1994	Service Tax	1.32	CESTAT	2011-12
Tamil Nadu Tax on Consumption or Sale of Electricity Act, 2003	Electricity consumption tax	382.63	Supreme Court	2003-04 to 2017-18

viii. On the basis of verification of records and according to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowing to a financial institution, bank, Government or dues to debenture holders.

ix. In our opinion and according to the information and explanations given to us, the Company has not raised monies by way of initial public offer or further public offer (including debt instruments) during the year. The term loans availed were applied for the purposes for which they were raised.

x. 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 by the Management, no fraud by the Company and no fraud on the Company by its officers or employees has been noticed or reported during the year.

xi. The Company has not paid any managerial remuneration and hence the provisions of Section 197, read with Schedule V to the Companies Act, 2013 are not applicable.

xii. The Company is not a Nidhi Company and hence compliance with the provisions of the Nidhi Rules is not applicable.

xiii. In our opinion and according to the information and explanations given to us, all transactions with related parties are incompliance with Sections 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in the financial statements, as required by the applicable accounting standards.

xiv. During the year the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.

xv. In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or persons connected with him which will come under the purview of Section 192 of the Companies Act, 2013.

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

Annexure - B to the Independent Auditors'' Report - 31^st March 2018

(Referred to in our report of even date)

Report on the Internal Financial Controls under clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)

1. We have audited the internal financial controls over financial reporting of Kothari Sugars and Chemicals Limited (âthe Companyâ) as of 31^st March 2018 in conjunction with our audit of the Standalone Ind AS financial statements of the Company for the year ended on that date.

Managementâs Responsibility for Internal Financial Controls

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

Auditors'' Responsibility

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

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

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls with reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

6. A company''s internal financial controls with reference to financial statements are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial controls with reference to financial statements includes those policies and procedures that

a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to Financial Statements

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

Opinion

8. In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to financial statements and such internal financial controls were operating effectively as at 31^st March 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.

For P.CHANDRASEKAR, LLP

Chartered Accountants

(FRN : 000580S/S200066)

Place : Chennai S.SRIRAM

Date : 28^th May 2018 Partner

Membership No. 205496

Mar 31, 2016

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying Standalone Financial Statements of Kothari Sugars and Chemicals Limited, (the âCompanyâ), which comprise the Balance Sheet as at 31st March 2016, the Statement of Profit and Loss, and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information, which we have signed under reference to this report.

MANAGEMENTâS RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

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

AUDITORâS 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 there under.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the financial statements that give true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Companyâs Directors, as well as evaluating the overall presentation of the financial statements.

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

OPINION

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

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2016;

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 (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of Sub-section (11) of Section 143 of the Act, we give in the Annexure âAâ a statement on the matters specified in the Paragraphs 3 and 4 of the Order, to the extent applicable.

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 31^st March 2016 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31^st March 2016 from being appointed as a Director in terms of Section 164(2) of the Act;

f) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.

g) with respect to the other matters to be included in the Auditorâs 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 No. 30 of the financial statements;

ii. the Company did not have any long-term contracts, including derivative contracts; and

iii. there has been no amounts required to be transferred, to the Investor Education and Protection Fund by the Company.

Annexure âAâ to the Independent Auditorsâ Report of even date on the Financial Statements of Kothari Sugars and Chemicals Limited.

The Annexure referred to in Paragraph 1 under the heading âReport on Other Legal and Regulatory Requirementsâ of our Report of even date:

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

(b) These fixed assets have been physically verified by the Management at reasonable intervals and no material discrepancies were noticed on such verification.

ii. The Management has conducted physical verification of inventory at reasonable intervals and no material discrepancies were noticed.

iii. The Company has not granted any loans to any party covered in the register maintained under section 189 of the Companies Act, 2013.

iv. The Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013, in respect of, investments, made by the Company. The company has not provided any loans or guarantee or security to any company covered under Section 185.

v. The Company has not accepted any deposits from the public.

vi. The Central Government has prescribed maintenance of Cost Records under Sub-section (1) of Section 148 of the Companies Act, 2013 and such accounts and records have been made and maintained. We are of the opinion that prima facie, the prescribed accounts and records have been maintained. However, we have not made a detailed examination of the records.

vii. According to the information and explanations given to us in respect of Statutory dues:

(a) The Company is regular in depositing undisputed statutory dues, including Provident Fund, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other Statutory Dues to the appropriate authorities and there were no undisputed amounts payable which were in arrears as at 31st March 2016 for a period of more than six months from the date they became payable.

(b) Details of dues of various taxes which have not been deposited as on 31st March 2016 on account of disputes are given below:

Name of the Statute	Nature of Dues	Amount Rs. in Lacs	Forum where the dispute is pending	Period to which the due belong
Central Excise Act, 1944	Excise Duty	78.69	CESTAT	1993-94 to 1996-97, 2003-04, 2006-07
Central Excise Act, 1944	Excise Duty	16.43	Assistant Commissioner. Central Excise	1996-97, 2010-11, 2014-15
Central Excise Act, 1944	Excise Duty	438.36	Joint / Assistant Commissioner Central Excise	2003-04 to 2011-12
Central Excise Act, 1944	Excise Duty	17.04	High Cout Madras	1995-96,1998-99, 1999-2000, 2002-03
Central Excise Act, 1944	Excise Duty	128.19	Supreme Court	1995-96 to 1998-99
Finance Act,1994	Service Tax	1.32	CESTAT	2011-12
Tamilnadu Tax on Consumption or sale of Electricity Act, 2003	Electricity Consumption Tax	587.57	Supreme Court	2009-10 to 2011-12

viii. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of loans to financial institutions, banks, Government or dues to debenture holders.

ix. In our opinion and according to the information and explanations given to us, the Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments) during the year. The term loans availed from the banks have been utilized for the purpose for which it was raised.

x. In our opinion and according to the information and explanations given to us no fraud by the Company or any fraud on the Company by its Officers or employees has been noticed or reported during the year.

xi. The company has not paid any managerial remuneration and hence the provisions of section 197, read with Schedule V to the Companies Act are not applicable.

xii. The Company is not a Nidhi Company and hence complying with the provisions of the Nidhi Rules, 2014 does not arise.

xiii. In our opinion and according to the information and explanations given to us, all the transactions with the related parties are in compliance with Sections 177 and 188 of Companies Act, 2013, where applicable and the details have been disclosed in the Financial Statements, etc., as required by the applicable Accounting Standards.

xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.

xv. In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with Directors or persons connected with him.

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

For R.Subramanian and Company

Chartered Accountants

Firmâs No. 004137S

N. Krishnamurthy

Place : Chennai Partner

Date : 27th May 2016 M. No: 019339

Mar 31, 2015

We have audited the accompanying financial statements of KOTHARI SUGARS AND CHEMICALS LIMITED ("The Company") which comprise of the Balance Sheet as at 31st March 2015, Statement of Profit & 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

The Management and Board of Directors of the Company are 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 the assets of the company and for preventing and detecting frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent; and design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate to 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 operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the company's directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

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

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

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

c) in the case of 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 2015, ('the Order") issued by the Central Government of India in terms of Sub section (11) of Section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

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

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

(c) the Balance Sheet and 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 financial statements comply with the Accounting Standards Specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of written representations received from the directors as on 31st March 2015 and taken on record by the Board of Directors, none of the directors are 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 Auditors report in accordance with Rule 11 of the Companies (Audits 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.

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

iii. The company did not have any contracts including long term derivative contracts for which there were any material foreseeable losses.

Annexure referred to in Paragraph 1 under the heading "Report on other legal and regulatory requirements "of our Report of even date to the members of Kothari Sugars and Chemicals Limited on the accounts of the company for the year ended 31st March, 2015 :

On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of our audit, we report that:

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

(b) As explained to us, these fixed assets have been physically verified by the management at regular intervals; as informed to us no material discrepancies were noticed on such verification;

(ii) (a) Inventories have been physically verified by the Management. In our opinion, the frequency of verification is reasonable.

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

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

(iii) The company has not granted any loan, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Act.

(iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, no major weakness has not been noticed or reported.

(v) The Company has not accepted any deposits from the public covered under Section 73 to 76 of the Companies Act, 2013

(vi) On the basis of records produced to us, we are of the opinion that, prima facie, the cost records prescribed by the Central Government under sub-section (1) of Section 148 of the Act have been made and maintained. However, we are not required to and have not carried out any detailed examination of such records.

(vii) (a) According to the information and explanations given to us and based on the records of the company examined by us, the company is regular in depositing the undisputed statutory dues, including Provident Fund, Employees' State Insurance Act, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty Value Added Tax other material statutory dues, as applicable, with the appropriate authorities in India. No undisputed amounts payable in respect of the above statutory dues were in arrears as at 31st March 2015 for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us and based on the records of the company examined by us, there are no dues of Income Tax, Sales Tax and Value Added Tax which have not been deposited on account of disputes. Dues of Service Tax, Customs Duty, Excise Duty and Electricity Consumption Tax as on 31st March 2015 which have not been deposited on account of disputes are given below:

Name of the Statute Nature of Dues Amount Rs. in Lacs

Central Excise Act, 1944 Excise Duty 88.12

Central Excise Act, 1944 Excise Duty 3.87

Central Excise Act, 1944 Excise Duty 427.17

Central Excise Act, 1944 Excise Duty 12.48

Central Excise Act, 1944 Excise Duty 128.19

Finance Act 1994 Service Tax 1.47

Tamilnadu Tax on Electricity 525.39 Consumption or sale Consumption Tax of Electricity Act, 2003

Name of the Statute Forum where the dispute is pending

Central Excise Act, 1944 CESTAT

Central Excise Act, 1944 Assistant Commissioner. Central Excise

Joint / Assistant Commissioner

Central Excise Act, 1944

Central Excise

Central Excise Act, 1944 High Cout Madras

Central Excise Act, 1944 Supreme Court

Finance Act 1994 CESTAT

Tamilnadu Tax on Supreme Court Consumption or sale of Electricity Act, 2003

Name of the Statute Period of dispute (financial year) 1993-94 to1996-97

Central Excise Act, 1944

2003-04

Central Excise Act, 1944 1999-2000

Central Excise Act, 1944 2005-06 to 2010-11

1995-96 1998-99

Central Excise Act, 1944

2002-03

Central Excise Act, 1944 1995-96 to 1998-99

Finance Act 1994 2010-11 to 2011-12

Tamilnadu Tax on 2009-10 to 2011-12 Consumption or sale of Electricity Act, 2003

(c) There was no amount which was 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 has no accumulated loss as at 31st March 2015. The company has not incurred cash loss in the financial year under report and in the immediately preceding financial year.

(ix) The company has not defaulted in repayment of dues to banks.

(x) The company has not given guarantees for loans taken by others from banks or financial institutions.

(xi) The Term loans have been applied for the purpose for which they were obtained.

(xii) During the course of our examination of the books and records of the company, carried in accordance with the auditing standards generally accepted in India, we have neither come across any instance of fraud on or by the Company noticed or reported during the course of our audit nor have we been informed of any such instance by the Management

For R.Subramanian and Company Chartered Accountants Firm's No. 004137S

R. Rajaram Place : Chennai Partner Date : May 29, 2015 M.No. 25210

Mar 31, 2014

We have audited the accompanying financial statements of Kothari Sugars and Chemicals Limited("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") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. 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. opinion

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

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

(b) in the case of the Statement of Profit and Loss, of the profit 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") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of 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 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013;

e. on the basis of written representations received from the directors as on March 31,2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

KOTHARI SUGARS AND CHEMICALS LIMITED ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE

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

2. Some of the fixed assets were physically verified during the year by the management in accordance with a program of verification, which in our opinion provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

3. Fixed assets disposed off during the year do not affect the concept of going concern.

4. Inventories were physically verified during the year by the management at reasonable intervals.

In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management was reasonable and adequate in relation to the size of the Company and the nature of its business.

In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

5. The company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the companies Act 1956.

6. In our opinion and according to the information and explanations given to us, the company has taken loans from the companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was NIL and the year-end balance of loans taken from such parties was Rs.850.53 lacs.

In our opinion, interest has been specified for such a loan and other terms and conditions on which loan were taken are not prima facie prejudicial to the interest of the company.

The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest wherever applicable.

7. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services and there was no continuing failure to correct any major weakness.

8. In our opinion and according to the explanations given to us, transactions made in pursuance of contracts or arrangements requiring entry in the registers maintained under section 301 of the Companies Act, 1956 have been entered.

The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

9. The company has no fixed deposits requiring compliance of provisions of Section 58 and 58 AA or any other relevant provisions of the act and the rules framed there under.

10. The Internal Audit function has been carried out by a firm of Chartered Accountants and is commensurate with the size of the company and the nature of its business.

11. We have broadly reviewed the books and records maintained by the company relating to the materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained for the period under audit. We have however not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

12. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service Tax, Custom Duty, Excise Duty, cess and any other statutory dues with the appropriate authorities during the year. The company has no dues towards Investor Education and Protection Fund and Wealth Tax.

According to the information and explanations given to us, Purchase Tax and Sales tax amounting to Rs.210.84 lacs has been in arrears for a period exceeding six months from the date they became payable .

According to the information and explanations given to us, the following are the dues in respect of Customs Duty, and Excise duty, which have not been deposited on account of any dispute and there are no such dues in respect of Wealth Tax, Service Tax, Income tax and Value Added Tax.

Sl No Nature of dues Forum Where Disputed Amount Unpaid Rs. in lacs

(i) Central Excise Joint Asst. Comm. 492.34 Central Excise

(ii) Central Excise CESTAT 38.12

(iii) Central Excise High Court 4.05

(iv) Central Excise Supreme Court 128.19

(v) Customs Commissioner 73.39 Appeals

13. The Company has no accumulated losses at the end of the year. The Company has not incurred any cash loss during the financial year and the immediately preceding financial year.

14. The Company has not defaulted in the payment of dues to financial institutions, banks and debenture holders during the year.

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

16. In our opinion and according to the information and explanations given to us the Company is not a Chit Fund, Nidhi or Mutual Benefit fund or Society.

17. In our opinion and according to the information and explanations given to us the Company is dealing in, trading in shares, debentures and other investments and proper records have been maintained of the transactions and contracts and timely entries have been made there in. These shares, debentures and other securities have been held by the company in its own name.

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

19. To the best of our knowledge and belief and according to the information and explanations given to us, new term loan availed by the Company during the year have been applied for the purposes for which loans were obtained.

20. According to the cash flow statement and other records examined by us and the information and explanations given to us, no funds raised on short term basis have been used for long term investments.

21. The Company has not allotted shares during the financial year to companies covered in the register maintained under section 301 of the Companies Act, 1956.

22. According to the information and explanations given to us and the records examined by us, no debentures have been issued during the year.

23. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year.

24. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year.

For R.Subramanian and Company Chartered Accountants Firm No. 004137S

Place : Chennai M. Rajasekar Date : May 27, 2014 Partner M.No.228637

Mar 31, 2013

Report on the Financial statements

We have audited the accompanying fnancial statements of Kothari Sugars and Chemicals Limited("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 fnancial statements that give a true and fair view of the fnancial position, fnancial performance and cash fows 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 fnancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these fnancial 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 fnancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fnancial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the fnancial 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 fnancial 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 fnancial 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 fnancial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

(c) in the case of the Cash Flow Statement, of the cash fows 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") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of 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 March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

KOTHARI SUGARS AND CHEMICALS LIMITED ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE

1. The Company has maintained proper records showing full particulars, including quantitative details and situation of fxed assets.

2. Some of the fxed assets were physically verified during the year by the management in accordance with a program of verification, which in our opinion provides for physical verification of all the fxed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

3. Fixed assets disposed off during the year do not affect the concept of going concern.

4. Inventories were physically verified during the year by the management at reasonable intervals.

In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management was reasonable and adequate in relation to the size of the Company and the nature of its business.

In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

5. The company has not granted any loan secured or unsecured to companies, frms or other parties covered in the register maintained under Section 301 of the companies Act 1956.

6. In our opinion and according to the information and explanations given to us, the company has taken loans from the companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.1500 lacs and the year-end balance of loans taken from two such parties was Rs.2467.84 lacs.

In our opinion, interest specified for such a loan taken during the year and other terms and conditions on which all such loans were taken are not prima facie prejudicial to the interest of the company.

The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest where ever applicable..

7. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fxed assets and for the sale of goods and services and there was no continuing failure to correct any major weakness.

8. In our opinion and according to the explanations given to us, transactions made in pursuance of contracts or arrangements requiring entry in the registers maintained under section 301 of the Companies Act, 1956 have been entered.

The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

9. The company has no fxed deposits requiring compliance of provisions of Section 58 and 58 AA or any other relevant provisions of the act and the rules framed there under.

10. The Internal Audit function has been carried out by frms of Chartered Accountants and is commensurate with the size of the company and the nature of its business.

11. We have broadly reviewed the books and records maintained by the company relating to the materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained for the period under audit. We have however not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

12. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service Tax, Custom Duty, Excise Duty, cess and any other statutory dues with the appropriate authorities during the year. The company has no dues towards Investor Education and Protection Fund and Wealth Tax.

According to the information and explanations given to us, Purchase Tax and Sales tax amounting to Rs.591.88 lacs has been in arrears for a period exceeding six months (pertaining to the period Apirl 2001 to June 2004) from the date they became payable. The company has appealed to the authorities in terms of the AAIFR order dated ^ 17.06.2004 in respect of these liabilities. J

According to the information and explanations given to us, the following are the dues in respect of Customs Duty, and Excise Duty, which have not been deposited on account of any dispute and there are no such dues in respect of Income Tax, Wealth Tax, Service Tax and Value Added Tax.

sl no. nature of dues Forum Where disputed Amount unpaid Rs in lacs

i. Central Excise Joint Asst. Comm. Central Excise 467.58

ii. Central Excise CESTAT 15.35

iii. Central Excise High Court 3.35

iv Central Excise Supreme Court 128.19

v. Customs Commissioner Appeals 73.39

13. The Company has no accumulated losses at the end of the year. The Company has not incurred any cash loss during the fnancial year and the immediately preceding fnancial year.

14. The Company has not defaulted in the payment of dues to fnancial institutions, banks and debenture holders during the year.

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

16. In our opinion and according to the information and explanations given to us the Company is not a Chit Fund, Nidhi or Mutual Benefit fund or Society.

17. In our opinion and according to the information and explanations given to us the Company is dealing in, trading in shares, debentures and other investments and proper records have been maintained of the transactions and contracts and timely entries have been made there in. These shares, debentures and other securities have been held by the company in its own name.

18. In our opinion and according to the information and explanations given to us the Company has not given any guarantee for any loans taken by others from banks and fnancial institutions during the fnancial year.

19. To the best of our knowledge and belief and according to the information and explanations given to us, new term loan availed by the Company during the year have been applied for the purposes for which loans were obtained.

20. According to the cash fow statement and other records examined by us and the information and explanations given to us, no funds raised on short term basis have been used for long term investments.

21. The Company has not allotted shares during the fnancial year to companies covered in the register maintained under section 301 of the Companies Act, 1956.

22. According to the information and explanations given to us and the records examined by us, no debentures have been issued during the year.

23. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the fnancial year.

For R.subramanian and company

Chartered Accountants

Firm No. 004137S

Place Chennai m. Rajasekar

Date May 30, 2013 Partner

M.No.228637

Mar 31, 2012

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

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

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent they are applicable to the company.

4. Further to our comments in the annexure referred to 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 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 it appears from our examination of such books.

c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement referred to in 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 the written representations received from directors and taken on record by the Board of Directors, we report that none of the director 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.

f) 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 notes thereon and schedules attached thereto, 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 so far it relates to the Balance Sheet, the state of affairs of the company as at 31st March 2012, ii) in so far it relates to the Statement of Profit and Loss, of the profit for the year ended on that date, and iii) in so far it relates to the Cash Flow Statement, of the Cash Flow for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

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

2. Some of the fixed assets were physically verified during the year by the management in accordance with a programme of verification, which in our opinion provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

3. Fixed assets disposed off during the year do not affect the concept of going concern.

4. Inventories were physically verified during the year by the management at reasonable intervals.

In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management was reasonable and adequate in relation to the size of the Company and the nature of its business.

In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

5. The company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act 1956.

6. The company has not taken any loan secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act 1956.

7. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services and there was no continuing failure to correct any major weakness.

8. In our opinion and according to the explanations given to us, there are no transactions made in pursuance of

contracts or arrangements requiring entry in the registers maintained under Section 301 of the Companies Act, 1956.

9. The company has no fixed deposits requiring compliance of provisions of Section 58 and 58 AA or any other relevant provisions of the Act.

10. The Internal Audit function has been carried out by a firm of Chartered Accountants and is commensurate with the size of the company and the nature of its business.

11. We have broadly reviewed the cost records and accounts relating to materials, labour and other items of cost 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. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained for the period under audit. We have however not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

12. According to the information and explanations given to us, the Company has been regular in depositing undisputed statutory dues, including Income Tax, Sales Tax, Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and any other statutory dues with the appropriate authorities during the year.

According to the information and explanations given to us, Purchase Tax and Sales Tax amounting to Rs. 811.09 lacs has been in arrears for a period exceeding six months from the date they became payable. The company has appealed to the authorities in terms of the AAIFR order dated 17.06.2004 in respect of these liabilities.

According to the information and explanations given to us, the following are the dues in respect of Customs Duty, Income Tax and Excise Duty, which have not been deposited on account of any dispute and there are no such dues in respect of Wealth Tax, Service Tax and Value Added Tax.

13. The Company has no accumulated losses at the end of the year. The Company has not incurred any cash loss during the year and in the immediately preceding financial year.

Sl. Nature of Forum Where Disputed Amount Unpaid No. Statute Rs inlakhs

(a) Central Excise Joint Asst. Comm. Central Excise 466.05

(b) Central Excise CESTAT 75.32

(c) Central Excise High Court 3.75

(d) Customs Commissioner Appeals 73.39

14. The Company has not defaulted in the dues payable to financial institutions, Banks and debenture holders during the financial year.

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

16. The Company is not a chit fund or a nidhi/mutual benefit fund /society.

17. In our opinion and according to the information and explanations given to us the Company is dealing in, trading in shares, debentures and other investments and proper records have been maintained of the transactions and contracts and timely entries have been made there in. These shares debentures and other securities have been held by the company in its own name.

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

19. To the best of our knowledge and belief and according to the information and explanations given to us, new term loan availed by the Company during the year have been applied for the purposes for which loans were obtained

20. According to the cash flow statement and other records examined by us and the information and explanations given to us, no funds raised on short term basis have been used for long term investments.

21. The company has not allotted shares during the financial year to companies covered in the register maintained under section 301 of the Companies Act 1956.

22. According to the information and explanations given to us and the records examined by us, no new debentures have been issued during the year.

23. According to the information and explanations given to us and the records examined by us there has been no public issue of shares and hence verification of end use does not arise.

24. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year.

For R.Subramanian and Company Chartered Accountants Firm No. 004137S

R.Rajaram Partner M.No.25210

Place : Chennai Date : August 03, 2012

Mar 31, 2011

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

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

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent they are applicable to the company.

4. Further to our comments in the annexure referred to 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 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 it appears from our examination of such books.

c) The Balance Sheet, Profit and Loss account and Cash Flow Statement referred to in this report are in agreement with the books of account.

d) In our opinion, the Balance Sheet, Profit and Loss account 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 the written representations received from directors and taken on record by the Board of Directors, we report that none of the director 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.

f) 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 notes thereon and schedules attached thereto, 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 so far it relates to the Balance Sheet, the state of affairs of the company as at 31st March 2011,

ii) in so far it relates to the Profit and Loss account, of the profit for the year ended on that date, and

iii) in so far it relates to the Cash Flow Statement, of the Cash Flow for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

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

2. Some of the fixed assets were physically verified during the year by the management in accordance with a programme of verification, which in our opinion provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

3. Fixed assets disposed off during the year do not affect the concept of going concern.

4. Inventories were physically verified during the year by the management at reasonable intervals.

In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management was reasonable and adequate in relation to the size of the Company and the nature of its business.

In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

5. The company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act 1956.

6. The company has not taken any loan secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act 1956.

7 In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services and there was no continuing failure to correct any major weakness.

8. In our opinion and according to the explanations given to us, there are no transactions made in pursuance of contracts or arrangements requiring entry in the registers maintained under section 301 of the Companies Act, 1956.

9. The company has no fixed deposits requiring compliance of provisions of Section58 and 58 AA or any other relevant provisions of the act.

10. The Internal Audit function has been carried out by a firm of Chartered Accountants and is commensurate with the size of the company and the nature of its business.

11. We have broadly reviewed the books and records maintained by the company relating to the manufacture of sugar and Industrial alcohol, 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 we are of the opinion that prima-facie the prescribed accounts and records have been made and maintained for the period under audit. We have not made a detailed examination of the records with a view to determining whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central government has not prescribed the maintenance of cost records for any other product manufactured by the company.

12. According to the information and explanations given to us, the Company has been regular in depositing undisputed statutory dues, including Income tax, Sales tax, Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and any other statutory dues with the appropriate authorities during the year.

According to the information and explanations given to us, purchase tax and sales tax amounting to Rs.1,015.13 lacs has been in arrears for a period exceeding six months from the date they became payable. The Sales Tax arreas are for the period April 2001 to 16th June 2004. The company has appealed to the authorities in terms of the AAIFR order dated 17.06.2004 in respect of these liabilities.

According to the information and explanations given to us, the following are the dues in respect of Customs Duty, Income tax and Excise Duty, which have not been deposited on account of any dispute and there are no such dues in respect of Wealth Tax and Service Tax .

(Rs.In lakhs)

Sl. Nature of dues Forum Where Disputed Amount Unpaid No 1 Central Excise Joint Asst. Comm. 386.80 Central Excise

2 Central Excise CESTAT 156.00

3 Central Excise High Court 70.79

4 Customs Commissioner Appeals 73.39

13. The Company has no accumulated losses at the end of the year. The Company has not incurred any cash loss during the year and in the immediately preceding financial year.

14. The Company has not defaulted in the dues payable to financial institutions, Banks and debenture holders during the financial year.

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

16. In our opinion and according to the information and explanations given to us the Company is dealing in , trading in shares, debentures and other investments and proper records have been maintained of the transactions and contracts and timely entries have been made there in These shares debentures and other securities have been held by the company .

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

18. To the best of our knowledge and belief and according to the information and explanations given to us, new term loan availed by the Company during the year have been applied for the purposes for which loans were obtained

19. According to the cash flow statement and other records examined by us and the information and explanations given to us, no short term funds have been raised during the financial year.

20. The company has not allotted shares during the financial year to companies covered in the register maintained under section 301 of the Companies Act 1956.

21. According to the information and explanations given to us and the records examined by us, no new debentures have been issued during the year.

22. According to the information and explanations given to us and the records examined by us there has been no public issue of shares and hence verification of end use does not arise.

23. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year.

for R.Subramanian and Company Chartered Accountants Firm No. 004137S

R.Rajaram Partner M.No.25210

Place : Chennai Date : July 29, 2011

Mar 31, 2010

1. We have audited the attached Balance Sheet of Kothari Sugars and Chemicals Limited as at March 31, 2010 and the Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the CompanyÃs management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent they are applicable to the company.

4. Further to our comments in the annexure referred to 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 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 it appears from our examination of such books.

(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement referred to in this report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, Profit and Loss account 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 the written representations received from Directors and taken on record by the Board of Directors, we report that none of the Director is disqualified as on March 31, 2010 from being appointed as a Director in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

(f) 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 notes thereon and schedules attached thereto, 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 so far it relates to the Balance Sheet, the state of affairs of the company as at March 31, 2010,

ii) in so far it relates to the Profit and Loss account, of the profit for the year ended on that date, and

iii) in so far it relates to the Cash Flow Statement, of the Cash Flow for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

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

2. Some of the fixed assets were physically verified during the year by the management in accordance with a programme of verification, which in our opinion provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

3. Fixed assets disposed off during the year do not affect the concept of going concern.

4. Inventories were physically verified during the year by the management at reasonable intervals.

In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management was reasonable and adequate in relation to the size of the Company and the nature of its business.

In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

5. The Company has not granted any loan secured or unsecured to the companies, firms or other parties covered in the register maintained under section 301 of the Companies Act 1956.

6. The Company has not taken any loan secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act 1956.

7. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services and there was no continuing failure to correct any major weakness.

8. In our opinion and according to the explanations given to us, there are no transactions made in pursuance of contracts or arrangements requiring entry in the registers maintained under Section 301 of the Companies Act, 1956.

9. The Company has no fixed deposits requiring compliance of provisions of Section 58 and 58 AA or any other relevant provisions of the act.

10. The Internal Audit function has been carried out by a firm of Chartered Accountants and is commensurate with the size of the company and the nature of its business.

11. We have broadly reviewed the books and records maintained by the company relating to the manufacture of Sugar and Industrial Alcohol, 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 we are of the opinion that prima-facie the prescribed accounts and records have been made and maintained for the period under audit. We have not made a detailed examination of the records with a view to determining whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records for any other product manufactured by the company.

12. According to the information and explanations given to us, the Company has been regular in depositing undisputed statutory dues, including Income Tax, Sales Tax, Provident Fund, Investor Education and Protection Fund, EmployeesÃ State Insurance, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and any other statutory dues with the appropriate authorities during the year.

According to the information and explanations given to us, Purchase Tax and Sales Tax amounting to Rs.1224.27 Lakhs has been in arrears for a period exceeding six months from the date they became payable. The company has appealed to the authorities in terms of the AAIFR order dated 17.06.2004 in respect of these liabilities.

According to the information and explanations given to us, the following are the dues in respect of Customs Duty, and Excise Duty, which have not been deposited on account of disputes and there are no such dues in respect of Income Tax, Wealth Tax and Service Tax.

(Rs. in Lakhs)

Sl. No. Nature of dues Forum Where Disputed Amount Unpaid

1. Central Excise Joint / Asst. Commissioner of Central Excise 105.93

2. Central Excise CESTAT 83.96

3. Central Excise High Court 4.11

4. Customs Commissioner Appeals 73.39

13. The accumulated losses of the Company have not exceeded fifty per cent of net worth at the end of the year. The Company has not incurred any cash loss during the year and in the immediately preceding financial year.

14. The Company has not defaulted in the dues payable to financial institutions, banks and debenture holders during the financial year.

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

16. In our opinion and according to the information and explanations given to us the Company is dealing in, trading in shares, debentures and other investments and proper records have been maintained of the transactions and contracts and timely entries have been made there in. These shares, debentures and other securities have been held by the company.

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

18. To the best of our knowledge and belief and according to the information and explanations given to us, new term loan availed by the Company during the year have been applied for the purposes for which loans were obtained

19. According to the Cash Flow Statement and other records examined by us and the information and explanations given to us, no short-term funds have been raised during the financial year.

20. The Company has not allotted shares during the financial year to companies covered in the register maintained under Section 301 of the Companies Act, 1956.

21. According to the information and explanations given to us and the records examined by us, no new debentures have been issued during the year.

22. According to the information and explanations given to us and the records examined by us there has been no public issue of shares and hence verification of end use does not arise.

23. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year.

for R Subramanian and Company

Chartered Accountants

Firm No. 004137S

Place: Chennai R Rajaram

Date : August 11, 2010 Partner

M.No.25210

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