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Auditor Report of Lloyds Metals & Energy Ltd.

Mar 31, 2015

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

Management's Responsibility for the Financial Statements Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act 2013. 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, on a test basis, 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 31,2015;

(b) in the case of the Statement of Profit and Loss, of the loss 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 Companies Act 1956, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. We have inquired into the matters specified under section 143(1) and based on the information and explanations given to us, there is no matter to be reported under this section.

3. As required by section 143(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 notified under 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) In our opinion and based on the information and explanations given to us, there are no financial transactions or matters which have any adverse effect on the functioning of the Company.

f) On the basis of written representations received from the directors as on March 31,2015, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of subsection (2) of Section 164 of the Companies Act, 2013.

g) There is no qualification, reservation or adverse remark relating to the maintenance of accounts and other matters connected therewith.

h) The Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

i) Such other matters as are prescribed by the Companies (Audit and Auditors) Rules, 2014 namely:-

i. The Company has disclosed the impact, if any, of pending litigations on its financial position in its financial statements.

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

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

*No general or special order has been directed by the Central Government, after consultation with National Financial Reporting Authority wrt the changes in CARO reporting as per section 143(11) of the Companies Act 2013, hence we are continuing to give CARO report based on Companies Act, 1956.

[Referred to in above the Auditor's Report of even date to the Lloyds Metals and Energy Limited on the Financial Statements for the year ended 31st March, 2015]

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

(b) As per the information and explanation given to us, fixed assets are physically verified by the management according to a phased programme designed to cover all the locations which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, the management during the year physically verified the fixed assets at certain locations and no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanation given to us, the Company has not disposed off any significant part of the fixed assets during the year. Thus, paragraph 4(i)(c) of the Companies (Auditor's Report) Order, 2003 is not applicable.

2. (a) Inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable

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

(c) In our opinion and according to the information & explanations given to us, the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

3. (a) According to information and explanation given to us, the Company has neither granted nor taken any secured or unsecured loans to / from Companies, firms, parties covered in the register maintained under Section 189 of the Act.

(b) In view of the above, provisions of clause 4(iii) (b), (c), (d), (e), (f) and (g) are not applicable to the Company.

4. In our opinion and according to information and explanation 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.

5. (a) On the basis of our examination of the books of account, we are of the opinion that the transactions that need to be entered in the register in pursuance of Section 189 of the Act have been entered in the said register.

(b) In our opinion, and according to the information & explanation given to us, the transactions made during the year with parties covered under Section 189 of the Act have been at prices which are reasonable, having regard to the prevailing market price for such goods and materials or prices at which transaction for similar goods or material have been made with other parties.

6. According to the information and explanation given to us, the Company has not accepted any deposits from the public within the meaning of Section 73 of the Act and the rules framed there under. Hence the provisions of clause 4(vi) are not applicable to the Company.

7. In our opinion and according to information and explanation given to us, the Company's present internal audit system is commensurate with its size and the nature of its business.

8. Pursuant to the rules made by the Central Government, the maintenance of Cost Records have been prescribed u/s. 148(1) of the Companies Act, 2013. We are of the view that prima facie the prescribed accounts and records have been maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9. (a) According to the books and records as produced and examined by us in accordance with generally accepted auditing practices in India and also Management representations, undisputed statutory dues in respect of Provident fund, Profession tax, Income Tax, Sales Tax, Value added tax, Wealth tax, Service tax, Custom duty, Excise duty, Cess and other material statutory dues, if any, applicable to it, has been regularly deposited with the appropriate authorities.

(b) According to the records of the Company, the disputed dues in respect of Excise Duty of Rs.19.69 lacs (Previous year Rs.12.50 Lacs) ; Service tax Rs.NIL (Previous year Rs.14.65 lacs) and Sales Tax Rs.1.03 lacs (Previous year Rs.1.03 lacs) as at March 31st, 2015 have not been deposited with appropriate authorities and no provision has been made for the same.

Sr. Name of the Amount Forum where No. Statute (In Lacs) dispute is pending

1 The Central 13.67 Customs, Excise Act, Excise, Service 1944 Tax Appellate Tribunal (CESTAT)

0.82 High Court

5.20 Supreme Court

2 The Central 1.03 Joint Sales Tax Act, Commissioner - 1956 Sales Tax

Total 20.70

10 The Company's accumulated losses at the end of the current year are more than fifty percent of its net worth and they have incurred cash losses during the current year as well as in the immediately preceding financial year.

11 In our opinion and according to the information and explanation given to us and the books of accounts verified by us, the Company has not defaulted in repayment of dues to a financial institution or bank.

12 According to information and explanation given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities during the year.

13 In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to it. Hence the provisions of clause 4(xiii) are not applicable to the Company.

14 According to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. Hence clause 4(xiv) is not applicable to the Company.

15 According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from a bank or financial institutions.

16 As per information given to us, no fresh term loans have been taken by the Company during the year. Hence the provisions of clause 4(xvi) are not applicable to the Company.

17 On the basis of overall examination of the Balance Sheet of the Company and according to information and explanations given to us, there are no funds raised on short-term basis, which have been used for long-term investments.

18 According to information and explanation given to us, the Company during the year, has not made any preferential allotment of shares to the party covered in the register maintained under section 189.

19 According to information and explanation given to us, the Company has not issued any fresh debenture during the year. Hence the provisions of clause 4(xix) are not applicable to the Company.

20 According to information and explanation given to us, the Company has not raised any money by public issue during the year. Hence the provisions of clause 4(xx) are not applicable to the Company.

21 During the course of our examination of the books of account carried in accordance with the generally accepted auditing standards in India, we have neither come across any instance of fraud on or by the Company, either noticed or reported during the year, nor have we been informed of such case by the Management.

For and on behalf of Todarwal & Todarwal Chartered Accountants ICAI Reg No : 111009W

Sunil Todarwal Dated : 10th April, 2015 Partner Place: Mumbai M. No. : 032512




Mar 31, 2014

We have audited the accompanying financial statements of Lloyds Metals and Energy 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 notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act 2013. 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, on a test basis, 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 loss 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 notified under 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.

ANNEXURE TO AUDITORS'' REPORT

[Referred to in above the Auditor''s Report of even date to the Members of Lloyds Metals and Energy Limited on the Financial Statements for the year ended 31st March 2014]

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

(b) As per the information and explanation given to us, fixed assets are physically verified by the management according to a phased programme designed to cover all the locations which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, the management during the year physically verified the fixed assets at certain locations and no material discrepancies were noticed on such verification.

(c) According to the information and explanation given to us, the company has disposed off an insignificant part of the fixed assets during the year. Thus, paragraph 4(i) (c) of the Companies (Auditor''s Report) Order, 2003 is not applicable.

2. (a) Inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable.

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

(c) In our opinion and according to the information & explanations given to us, the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

3. According to information and explanation given to us, the Company has neither granted nor taken any secured or unsecured loans to / from companies, forms, parties covered in the register maintained under Section 301 of the Act.

In view of the above, provisions of clause 4(iii) (b), (c), (d), (e), (f) and (g) are not applicable to the company.

4. In our opinion and according to information and explanation 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.

5. (a) On the basis of our examination of the books of account, we are of the opinion that the transactions that need to be entered in the register in pursuance of Section 301 of the Act have been entered in the said register.

(b) In our opinion, and according to the information & explanation given to us, the transactions made during the year with parties covered under Sec.301 of the Act have been at prices which are reasonable, having regard to the prevailing market price for such goods and materials or prices at which transaction for similar goods or material have been made with other parties.

6. According to the information and explanation given to us, the company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Act and the rules framed there under. Hence the provisions of clause 4(vi) are not applicable to the company.

7. In our opinion and according to information and explanation given to us, the Company''s present internal audit system is commensurate with its size and the nature of its business.

8. Pursuant to the rules made by the Central Government, the maintenance of Cost Records have been prescribed u/s. 209(1) (d) of the Companies Act, 1956. We are of the view that prima facie the prescribed accounts and records have been maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9. (a) According to the books and records as produced and examined by us in accordance with generally accepted auditing practices in India and also Management representations, undisputed statutory dues in respect of Provident fund, Profession tax, Income Tax, Sales Tax, Value added tax, Wealth tax, Service tax, Custom duty, Excise duty, Cess and other material statutory dues, if any, applicable to it, has been regularly deposited with the appropriate authorities.

(b) According to the records of the Company, the disputed dues in respect of Excise Duty of Rs. 12.50 Lacs (Previous year Rs. 12.50 Lacs) ; Service tax of Rs. 14.65 Lacs (Previous year Rs. 14.70 lacs) and Sales Tax Rs. 1.03 Lacs (Previous year Nil) as at March 31st, 2014 have not been deposited with appropriate authorities and no provision has been made for the same.

Sr. Name of the Statute Amount Forum where dispute is No. (In Lacs) pending

1 The Central Excise Act, 1944

6.50 Customs, Excise, Service Tax Appellate Tribunal (CESTAT)

4.25 High Court

1.75 Supreme Court

14.65 Joint Commissioner - Service Tax

2 The Central Sales Tax 1.03 Joint Commissioner - Sales Act, 1956 Tax

Total 28.18

10 The Company''s accumulated losses at the end of the financial year are less than ffty per cent of its net worth and the company has incurred cash losses during the year but not in the immediately preceding financial year.

11 In our opinion and according to the information and explanation given to us and the books of accounts verified by us, the company has not defaulted in repayment of dues to a financial institution or bank.

12 According to information and explanation given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities during the year.

13 In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to it. Hence the provisions of clause 4(xiii) are not applicable to the company.

14 According to the information and explanations given to us, the Company is not a dealer or trader in shares, securities, debentures and other investments. Hence clause 4(xiv) is not applicable to the company.

15 According to the information and explanations given to us, the Company has not given guarantee for loans taken by others from a bank or financial institutions.

16 As per information given to us, new Vehicle Term Loans have been taken by the Company during the year, and the term loans were applied for the purpose for which the loans were obtained.

17 On the basis of overall examination of the Balance Sheet of the Company and according to information and explanations given to us, there are no funds raised on short-term basis, which have been used for long-term investments.

18 According to information and explanation given to us, the Company has during the year, not made any preferential allotment of shares to the party covered in the register maintained under section 301.

19 According to information and explanation given to us, the company has not issued any fresh debenture during the year. Hence the provisions of clause 4(xix) are not applicable to the company.

20 According to information and explanation given to us, the Company has not raised any money by public issue during the year. Hence the provisions of clause 4(xx) are not applicable to the company.

21 During the course of our examination of the books of account carried in accordance with the generally accepted auditing standards in India, we have neither come across any instance of fraud on or by the Company, either noticed or reported during the year, nor have we been informed of such case by the Management.

For and on behalf of

Todarwal & Todarwal

Chartered Accountants

ICAI Reg No : 111009W

Sunil Todarwal

Dated : 26th May, 2014 Partner

Place: Mumbai M. No. : 32512

 
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