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Auditor Report of Mold-Tek Packaging Ltd.

Mar 31, 2015

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

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making 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 the 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 in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial 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, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

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 the paragraph 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 31st March, 2015 taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164(2) of the Act;

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

1. The Company has disclosed the impact of pending litigations on its financial position in its financial statements;

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

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

The Annexure referred to in our Independent Auditors' Report to the Members of the Company on the financial statements for the year ended 31st March, 2015, we report that:

i. In respect of its fixed assets

a. The Company maintains a soft copy record of its depreciable assets, reflecting a year wise classification of assets of such category.

b. No physical verification of fixed assets has been carried out by the management during the year ended 31st March, 2015.

c. During the year, we are informed, that the Company has not disposed off a substantial part of the fixed assets of the Company.

ii. In respect of its inventory

a. As per the explanations given to us, physical verification of raw materials, stocks in process, finished goods and other items of consumables inventory has been conducted by the management during the period at regular intervals. In our opinion, the frequency of such physical verification is reasonable.

b. The procedures for physical verification of inventory followed by the management, in our opinion, have scope for further improvement. Most of the procedures followed, are prima facie reasonable in relation to the size of the Company and the nature of the business at present.

c. The Company maintains excise related records for its raw materials and finished goods, which are reasonably properly maintained. For its semi finished (in-process) stocks, the records can be improved/bettered with respect to receipts, issues, balances being maintained in a chronological sequence, recording of movement & custody of such stocks as well as consumables inventory. We recommended the maintenance of a priced stores ledger, and a formal procedure for reconciliation of factory & accounts related inventory records.

d. We are informed by the management that no material differences or discrepancies were noticed on physical verification of stocks with accounts related inventory records.

iii. a. The Company has not granted/taken any loans, secured or unsecured to/from the companies, firms of other parties covered in the register maintained under Section 189 of the Companies Act, 2013, except in respect of current account transactions with its group company, M/s. Mold- Tek Technologies Limited which have been settled in accordance with agreed terms and conditions and there are no overdue amounts.

b. In respect of the debit balances and advances in the nature of loans, including amounts due on current accounts, no stipulations have been made as to repayments, and management expresses confidence in recovering the amounts due.

iv. a. In our opinion, and according to the information and explanations given to us, there exist adequate internal control procedures 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.

b. Certain areas/procedures and control weaknesses identified during the course of internal/statutory audit and other reviews need to be considered immediately for improvement and up-gradation to better levels.

c. While we have not observed any continuing failure of intent to correct identified weaknesses in internal controls during the course of our audit, observations made need to be comprehensively addressed and rectified.

v. In our opinion and explanations given to us, the Company has not invited or accepted any deposits from the public attracting the provisions of Section 73 to 76 of the Companies Act, 2013 and the rules framed there under. No order has been passed by the Company Law Board regarding compliance of above said provisions.

vi. The Central Government has prescribed maintenance of cost records under Section 148(1) of the Companies Act, 2013 for the products of the Company as per Cost Accounting Records Rules, 2014. A suitable compliance/report in this regard is pending.

vii. a. According to the records of the Company furnished to us, the Company is regular in depositing undisputed statutory dues including, provident fund, employees state insurance, income tax, sales tax, customs duty, excise duty, cess and other material statutory dues with delays of nominal nature.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income tax, sales tax, wealth tax, service tax, duty of customs, value added tax, cess and other material statutory dues were in arrears as at 31st March, 2015 for a period of more than six months from the date they became payable.

c. According to the information and explanations given to us, there are no material dues of wealth tax, duty of customs and cess which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following dues of income tax, sales tax, service tax and value added tax have not been deposited by the Company on account of disputes (Issues under regular assessment are not reported):

Name of the Nature of dues Rs. Period to which statute the amount relates (AY)

Income Tax Payment of 43,81,426 2008-09 advance tax

Income Tax Payment of advance 1,08,78,115 2009-10 tax & MAT credit utilization

Income Tax Long-term 2,23,550 2010-11 capital gain

Income Tax Dividend 24,10,900 2012-13 Distribution Tax

Sales Tax - Sales tax incentive Nil 1996-97 Andhra Pradesh Scheme (Turnover)

Sales Tax - Input VAT credit 16,30,409 2005-06 Andhra Pradesh

Sales Tax - Input VAT credit 7,56,184 2006-07 Andhra Pradesh

Sales Tax - Excess input tax 5,58,366 2005-06 Andhra Pradesh credit claimed

Sales Tax - Excess input tax 11,29,228 2006-07 Andhra Pradesh credit claimed

Sales Tax - Sale of plant & 1,53,185 2007-08 Andhra Pradesh machinery

Name of the Statute Forum where dispute is pending

Income Tax The Commissioner of Income Tax (Appeals) - V

Income Tax Assistant Commissioner of Income Tax - Circle 16(2)

Income Tax Assistant Commissioner of Income Tax - Circle 16(2)

Income Tax The Commissioner of Income Tax (Appeals) - IV

Sales Tax-Andhra Pradesh Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh The High Court of Andhra Pradesh

Sales Tax-Andhra Pradesh Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh The Appellate Dy. Commissioner (CT), Panjagutta Division, Hyderabad

viii. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

ix. In our opinion and according to the information and explanations given to us, there are no defaults on dues payable to institutions/bank/others on the date of the Balance Sheet.

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

xi. In our opinion, the term loans availed have generally been applied for the purpose for which they were raised.

xii. According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For Praturi & Sriram

Chartered Accountants

Firm Reg. No. 002739S

Sri Raghuram Praturi

Hyderabad Partner

19th May, 2015 Membership No. 221770


Mar 31, 2014

We have audited the accompanying financial statements of Mold-Tek Packaging Limited, 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 read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. 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, subject to the above 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 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 and proper returns adequate for the purposes of our audit have been received from branches not visited by us.

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 and with the returns received from branches not visited by us.

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 and Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013; and

e. On the basis of written representations received from the directors as on 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.

The Annexure referred to in paragraph 1 of the our Report of even date to the members of Mold-Tek Packaging Limited on the accounts of the Company for the year ended 31st March, 2014 On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that:

1. In respect of its fixed assets:

a. The Company maintains a soft copy record of its depreciable assets, reflecting a year wise classification of assets of such category.

b. No physical verification of fixed assets but for the assets in one of its unit where fire accident took place,has been carried out by the management during the year ended 31st March, 2014.

c. During the year, we are informed, that the company has not disposed off a substantial part of its fixed assets.

2. In respect of its inventory

a. As per the explanations given to us, physical verification of raw materials, stocks in process, finished goods and other items of consumables inventory has been conducted by the management during the period at regular intervals . In our opinion, the frequency of such physical verification is reasonable.

b. The procedures for physical verification of inventory followed by the management, in our opinion, have scope for further improvement. Most of the procedures followed, are prima facie reasonable in relation to the size of the Company and the nature of the business at present.

c. The Company maintains excise related records for its raw materials and finished goods, which are reasonably properly maintained. For its semi finished (in-process) stocks, the records can be improved/bettered with respect to receipts, issues, balances being maintained in a chronological sequence, recording of movement & custody of such stocks as well as consumables inventory. We recommended the maintenance of a priced stores ledger, and a formal procedure for reconciliation of factory & accounts related inventory records.

d. We are informed by the management that no material differences or discrepancies were noticed on physical verification of stocks with accounts related inventory records.

3. a. The Company has not granted/taken any loans, secured or unsecured to/from the companies, firms of other parties covered in the register maintained under Section 301 of the Companies Act, 1956 except in respect of current account transactions with its associate/group company, M/s. Mold-Tek Technologies Limited.

b. In respect of the debit balances and advances in the nature of loans, including amounts due on current accounts, no stipulations have been made as to repayments, and management expresses confidence in recovering the amounts due.

4. a. In our opinion, and according to the information and explanations given to us, there exist adequate internal control procedures 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.

b. Certain areas/procedures and control weaknesses identified during the course of internal/statutory audit and other reviews need to be considered immediately for improvement and up-gradation to better levels.

c. While we have not observed any continuing failure of intent to correct identified weaknesses in internal controls during the course of our audit, observations made need to be comprehensively addressed and rectified.

5. a. Based on the audit procedures applied by us and according to the information and explanations provided by the management, the transactions that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the explanations given to us, there are transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees five Lakhs in respect of any party during the year, at prices which are prima facie reasonable having regard to prevailing market prices.

6. In our opinion and explanations given to us, the company has not invited or accepted any deposits from the public attracting the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under. No order has been passed by the Company Law Board regarding compliance of above said provisions. However, security deposits received from employees Rs. 5.40 lakhs are not maintained in a separate bank account as stipulated in Section 417 of the Companies Act, 1956.

7. The Company presently has an internal audit conducted by an external agency, which needs to be reviewed for its depth & scope so as to make it commensurate with the size of the Company & the nature of its business.

8. The Central Government has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for the products of the Company as per Cost Accounting Records Rules 2011. A suitable compliance/ report in this regard is pending.

9. a. According to the records of the company furnished to us, the Company is regular in depositing undisputed statutory dues including, provident fund, employees state insurance, income tax, sales tax, customs duty, excise duty, cess and other material statutory dues with delays of nominal nature.

b. According to the information and explanations given by the management, there are no undisputed amounts payable in respect of income tax, sales tax, wealth tax, customs duty and excise duty and cess which were in arrears as 31st March, 2014 for a period of more than six months from date they become payable.

c. According to the information and explanations given to us, there are no material dues of wealth tax and cess which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following dues of income tax and sales tax are under dispute (issues under regular assessment not reported) as on date of Balance Sheet:

Name of the Nature of dispute Amount Period to which statute Rs. the payment relates (AY)

Income Tax Payment of 43,81,426 2008-09 advance tax

Income Tax Payment of advance 1,08,78,115 2009-10 tax & MAT credit utilization

Income Tax Long-term capital 2,23,550 2010-11 gain Income Tax Sales Tax - Sales Tax Incentive Nil 1996-97 Andhra Scheme (Turnover) Pradesh

Sales Tax - Input VAT credit 16,30,409 2005-06 Andhra Pradesh

Sales Tax - Input VAT credit 7,56,184 2006-07 Andhra Pradesh

Sales Tax - Excess input tax 5,58,366 2005-06 Andhra credit claimed Pradesh

Sales Tax - Excess input tax 11,29,228 2006-07 Andhra credit claimed Pradesh

Name of the Forum where statute dispute is pending

Income Tax The Commissioner of Income Tax (Appeals) - V

Income Tax Assistant Commissioner of Income Tax - Circle 16(2)

Income Tax Assistant Commissioner of Income Tax - Circle 16(2)

Sales Tax - Sales Tax Appellate Tribunal, Andhra Andhra Pradesh, Hyderabad Pradesh

Sales Tax - The High Court of Andhra Andhra Pradesh Pradesh

Sales Tax - Sales Tax Appellate Tribunal, Andhra Andhra Pradesh, Hyderabad Pradesh

Sales Tax - Sales Tax Appellate Tribunal, Andhra Andhra Pradesh, Hyderabad Pradesh

Sales Tax - Sales Tax Appellate Tribunal, Andhra Andhra Pradesh, Hyderabad Pradesh

10. The Company has no accumulated losses at the end of the financial year under review. The Company has not incurred cash losses during the financial year covered by our audit, and also in the previous financial year.

11. In our opinion and according to the information and explanations given to us, there are no defaults on dues payable to institutions/bank/ others on the date of the Balance Sheet.

12. We are informed that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

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

15. We are informed that the company has not given any guarantees for loans taken by others from banks or financial institutions.

16. In our opinion, the term loans availed have generally been applied for the purpose for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that during the report under review, long term funds, of Rs. 2,31.61 lakhs have been used for short term purpose and no interest on such long term funds utilised for short term purpose has been capitalised.

18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year.

19. According to information and explanations given to us, during the period covered by our audit report, the Company has not issued debentures.

20. According to information and explanations given to us, the Company has not raised monies by means of public issue during the year.

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

For PRATURI & SRIRAM Chartered Accountants (Firm Registration No. 002739S)

Sri Raghuram Praturi Hyderabad Partner 29th May, 2014 Membership No. 221770


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Mold-Tek Packaging Limited, which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, subject to the above 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 subject to the following:

Short provision of deferred tax liability in accordance with Accounting Standard 22 issued by ICAI, Rs.269.92 lakhs pertaining to earlier years impacting non-current liabilities, reserves & surplus and prior period items.

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

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

c. In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 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 and proper returns adequate for the purposes of our audit have been received from branches not visited by us.

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 and with the returns received from branches not visited by us.

d. In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash

Flow Statement comply with the Accounting Standards referred to in sub-section(3C) of Section 211 of the Companies Act, 1956;

e. On the basis of written representations received from the Directors as on 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.

The annexure referred to in paragraph 1 of the our Report of even date to the Members of Mold-Tek Packaging Limited on the accounts of the Company for the year ended 31st March, 2013

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

1. In respect of its fixed assets:

a. The Company maintains a soft copy record of its depreciable assets, reflecting a year wise classification of assets of such category.

b. No physical verification of fixed assets has been carried out by the management during the year ended 31st March, 2013.

c. During the year, we are informed, that the Company has not disposed off a substantial part of its fixed assets.

2. In respect of its inventory

a. As per the explanations given to us, physical verification of raw materials, stocks in process, finished goods and other items of consumables inventory has been conducted by the management during the period at regular intervals . In our opinion, the frequency of such physical verification is reasonable.

b. The procedures for physical verification of inventory followed by the management, in our opinion, have scope for further improvement. Most of the procedures followed, are prima facie reasonable in relation to the size of the Company and the nature of the business at present.

c. The Company maintains excise related records for its raw materials and finished goods, which are reasonably properly maintained. For its semi finished (in- process) stocks, the records can be improved/bettered with respect to receipts, issues, balances being maintained in a chronological sequence, recording of movement & custody of such stocks as well as consumables inventory. We recommended the maintenance of a priced stores ledger, and a formal procedure for reconciliation of factory & accounts related inventory records.

d. We are informed by the management that no material differences or discrepancies were noticed on physical verification of stocks with accounts related inventory records.

3. a. The Company has not granted/taken any

loans, secured or unsecured to/from the companies, firms of other parties covered in the register maintained under Section 301 of the Companies Act, 1956 except in respect of current account transactions with its associate/group company, Mold-Tek Technologies Limited.

b. In respect of the debit balances and advances in the nature of loans, including amounts due on current accounts, no stipulations have been made as to repayments, and management expresses confidence in recovering the amounts due.

4. a. In our opinion, and according to the

information and explanations given to us, there exist adequate internal control procedures 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.

b. Certain areas/procedures and control weaknesses identified during the course of internal/statutory audit and other reviews need to be considered immediately for improvement and up-gradation to better levels of control.

c. While we have not observed any continuing failure of intent to correct identified weaknesses in internal controls during the course of our audit, observations made need to be comprehensively addressed and rectified.

5. a. Based on the audit procedures applied by us and according to the information and explanations provided by the management, the transactions that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the explanations given to us, there are transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees five lakhs in respect of any party during the year, at prices which are prima facie reasonable having regard to prevailing market prices.

6. In our opinion and explanations given to us, the company has not invited or accepted any deposits from the public attracting the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under. No order has been passed by the Company Law Board regarding compliance of above said provisions. However, security deposits received from employees Rs.4,86,852 are not maintained in a separate bank account as stipulated in Section 417 of the Companies Act, 1956.

7. The Company presently has an internal audit conducted by an external agency, which needs to be reviewed for its depth & scope so as to make it commensurate with the size of the Company & the nature of its business.

8. The Central Government has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for the products of the Company as per the Companies (Cost Accounting Records) Rules, 2011. A suitable compliance/report in this regard is pending for the financial year under review.

9. a. According to the records of the company furnished to us, the Company is regular in depositing undisputed statutory dues including, provident fund, employees state insurance, income tax, sales tax, customs duty, excise duty, cess and other material statutory dues with delays of nominal nature.

b. According to the information and explanations given by the management, there are no undisputed amounts payable in respect of income tax, sales tax, wealth tax, customs duty and excise duty and cess which were in arrears as 31st March, 2013 for a period of more than six months from date they become payable.

c. According to the information and explanations given to us, there are no material dues of wealth tax and cess which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following dues of income tax and sales tax are under dispute as on date of balance sheet:

Name of the Nature of dispute Amount statute Rs.

Income Tax Payment of 43,81,426 advance tax

Income Tax Payment of advance tax 1,08,78,115 & MAT credit utilization

Income Tax Long-term capital gain 2,23,550

Sales Tax - Sales Tax Incentive Nil Andhra Pradesh Scheme (Turnover)

Sales Tax - Input VAT credit 16,30,409 Andhra Pradesh

Sales Tax - Input VAT credit 7,56,184 Andhra Pradesh

Sales Tax - Sale of plant & 1,53,185 Andhra Pradesh machinery

Sales Tax - Excess input tax 5,58,366 Andhra Pradesh credit claimed

Sales Tax - Excess input tax 11,29,228 Andhra Pradesh credit claimed



Name of Statute Period to which Forum where the payment dispute is relates (AY) pending

Income Tax 2008-09 The Commissioner of Income Tax (Appeals) - V

Income Tax 2009-10 Assistant Commissioner of Income Tax - Circle 16(2)

Income Tax 2010-11 Assistant Commissioner of Income Tax - Circle 16(2)

Sales Tax-Andhra Pradesh 1996-97 Sales Tax Appellate Tribunal Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh 2005-06 The High Court of Andhra Pradesh

Sales Tax-Andhra Pradesh 2006-07 Sales Tax Appellate Tribunal Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh 2007-08 The Appellate Dy. Commissioner (CT), Panjagutta Division, Hyderabad

Sales Tax-Andhra Pradesh 2005-06 Sales Tax Appellate Tribunal Andhra Pradesh, Hyderabad

Sales Tax-Andhra Pradesh 2006-07 Sales Tax Appellate Tribunal Andhra Pradesh, Hyderabad

10. The Company has no accumulated losses at the end of the financial year under review. The Company has not incurred cash losses during the financial year covered by our audit, and also in the previous financial year.

11. In our opinion and according to the information and explanations given to us, there are no defaults on dues payable to institutions/bank/ others on the date of the Balance Sheet.

12. We are informed that the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

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

15. We are informed that the Company has not given any guarantees for loans taken by others from banks or financial institutions.

16. In our opinion, the term-loans availed have generally been applied for the purpose for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that during the report under review, short term funds, (inclusive of cash generated from operations) of Rs.2.97 crore have been used for long term purpose. No interest on such short term funds utilised for long term purpose has been capitalized.

18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares to parties covered under Section 301 of the Companies Act during the year.

19. According to information and explanations given to us, during the period covered by our audit report, the Company has not issued debentures.

20. According to information and explanations given to us, the Company has not raised monies by means of public issue during the year.

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



For PRATURI & SRIRAM

Chartered Accountants

(Firm Registration No. 002739S)







Sri Raghuram Praturi

Hyderabad Partner

27th May, 2013 Membership No. 221770


Mar 31, 2012

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

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

1. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India, in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent applicable.

2. 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 purposes of our audit;

b. In our opinion, proper books of accounts, 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 accounts;

d. In our opinion, these financial statements have been prepared in compliance with the applicable accounting standards referred to in sub-clause (3C) of Section 211 of the Companies Act, 1956;

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

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

i. In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2012

ii. In the case of Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and

iii. In the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

1. In respect of its fixed assets:

a. The Company maintains a soft copy record of its depreciable assets, reflecting a year wise classification of assets of such category.

b. No physical verification of fixed assets has been carried out by the management during the year ended 31st March, 2012.

c. During the year, we are informed, that the Company has not disposed off a substantial part of its fixed assets.

2. In respect of its inventory:

a. As per the explanations given to us, physical verification of raw materials, stocks in process, finished goods and other items of consumables inventory has been conducted by the management during the period at regular intervals. In our opinion, the frequency of such physical verification is reasonable.

b. The procedures for physical verification of inventory followed by the management, in our opinion, have scope for further improvement. Most of the procedures followed, are prima facie reasonable in relation to the size of the Company and the nature of the business at present.

c. The Company maintains excise related records for its raw materials and finished goods, which are reasonably properly maintained. For its semi finished (in- process) stocks, the records can be improved/bettered with respect to receipts, issues, balances being maintained in a chronological sequence, recording of movement & custody of such stocks as well as consumables inventory.

We recommended the maintenance of a priced stores ledger, and a formal procedure for reconciliation of factory & accounts related inventory records.

d. We are informed by the management that no material differences or discrepancies were noticed on physical verification of stocks with accounts related inventory records.

3. a. The Company has not granted/taken any

loans, secured or unsecured to/from the companies, firms of other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b. In respect of the debit balances and advances in the nature of loans, including amounts due on current accounts, no stipulations have been made as to repayments, and management expresses confidence in recovering the amounts due.

4. a. In our opinion, and according to the

information and explanations given to us, there exist adequate internal control procedures 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.

b. Certain areas/procedures and control weaknesses identified during the course of internal/statutory audit and other reviews need to be considered immediately for improvement and up-gradation to better levels.

c. While we have not observed any continuing failure of intent to correct identified weaknesses in internal controls during the course of our audit, observations made need to be comprehensively addressed and rectified.

5. a. According to the information and

explanations provided by the management, the transactions that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the explanations given to us, there are transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees five lakhs in respect of any party during the year, at prices which are prima facie reasonable having regard to prevailing market prices.

6. In our opinion and explanations given to us, the Company has not invited or accepted any deposits from the public attracting the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under. No order has been passed by the Company Law Board regarding compliance of above said provisions. However, security deposits received from employees Rs.4,11,458 are not maintained in a separate bank account as stipulated in Section 417 of the Companies Act, 1956.

7. The Company presently has an internal audit conducted by an external agency, which needs to be reviewed for its depth & scope so as to make it commensurate with the size of the Company & the nature of its business.

8. The Central Government has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for the products of the Company as per Cost Accounting Records Rules, 2011. A suitable compliance/ report in this regard is pending.

9. a. According to the records of the Company

furnished to us, the Company is regular in depositing undisputed statutory dues including, provident fund ,employees state insurance, income tax, sales tax, customs duty, excise duty, cess and other material statutory dues with delays of nominal nature.

b. According to the information and explanations given by the management, there are no undisputed amounts payable in respect of income tax, sales tax, wealth tax, customs duty and excise duty and cess which were in arrears as 31st March, 2012 for a period of more than six months from date they become payable.

10. The Company has no accumulated losses at the end of the financial year under review. The Company has not incurred cash losses during the financial year covered by our audit, and also in the previous financial year.

11. In our opinion and according to the information and explanations given to us, there are no defaults on dues payable to institutions/bank/ others on the date of the Balance Sheet.

12. We are informed that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

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

15. We are informed that the Company has not given any guarantees for loans taken by others from banks or financial institutions.

16. In our opinion, the term-loans availed have generally been applied for the purpose for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that during the report under review, short term funds, (inclusive of cash generated from operations) of Rs.4.98 crore have been used for long term purpose. Interest of Rs.58.25 lakhs computed based on weighted average cost of borrowings on such short term funds utilized for long term purpose (acquisition, erection and construction of Daman plant expansion) has been capitalized.

18. During the year, the Company has allotted a total of 31,65,000 equity shares on conversion of warrants allotted on preferential basis (12,40,000 warrants allotted on 7th September, 2011 @ Rs.40 including premium of Rs.30 per equity share and 19,25,000 warrants allotted on 4th February, 2012 @ Rs.45.80 including premium of Rs.35.80 per equity share) which includes the parties covered under Section 301 of the Companies Act. The price at which the shares are allotted is based on Chapter XIII of SEBI Regulations, 2000 and thereby not prejudicial to the interest of the Company.

19. According to information and explanations given to us, during the period covered by our audit report, the Company has not issued debentures.

20. According to information and explanations given to us, the Company has not raised monies by means of public issue during the year.

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

For PRATURI & SRIRAM

Chartered Accountants

(Firm Registration No. 002739S)

Sri Raghuram Praturi

Hyderabad Partner

29th May, 2012 Membership No. 221770


Mar 31, 2010

We have audited the attached Balance Sheet of Mold- Tek Packaging Limited as at 31st March, 2010 and also the Profit and Loss Account of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management and our responsibility is to express an opinion on these financial statements based on our audit.

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

1. As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government of India, in terms of Section 227(4A) of the Companies Act, 1956 we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent applicable.

2. 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 purposes of our audit- fa. In our opinion, proper books of accounts, as required by law, have been kept by the Company so far as appears from our examination of those books;

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

d. In our opinion, these financial statements have been prepared in compliance with the applicable accounting standards referred to in sub-clause (3C) of Section 211 of the Companies Act, 1956;

e. On the basis of written representations received from the Directors as on 31st March 2010, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March 2010 from being appointed as a director in terms of clause (g) of sub section (1) of Section 274 of the Companies Act, 1956; and

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

i. In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010;

ii. In the case of Profit and Loss Account, of the profit of the Company for the period ended on that date; and

iii. In case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Annexure to Auditors Report (Referred to in paragraph 1 of our report of even date attached)

1. In respect of its fixed assets:

a. The Company maintains a soft copy record of its depreciable assets, reflecting a year- wise classification of assets of such category. The record does not include quantitative details and the situation/ location of its depreciable assets. Non- depreciable assets are not recorded.

b. No physical verification of fixed assets has been carried out by the management during the year ended 31st March 2010.

c. During the year, we are informed that the Company has not disposed off a substantial part of its fixed assets. However, it has written down to nullity residuary balances in respect of assets not put to use and unutilized for commercial purposes either due to obsolescence and/ or productive value, especially where the said assets have outlived their productive value.

2. In respect of its inventory:

a. As per the explanations given to us, physical verification of raw materials, stocks in process, finished goods and other items of consumables inventory has been conducted by the management during the period at regular intervals. In our opinion, the frequency of such physical verification is reasonable.

b. The procedures for physical verification of inventory followed by the management, in our considered opinion, have scope for ongoing and further improvement. Most of the procedures followed, are prima facie reasonable in relation to the size of the Company and the nature of the business at present.

c. The Company maintains excise related records for its raw materials and finished goods, which are reasonably properly maintained. For its semi finished (in- process) stocks, the records can be improved/bettered with respect to receipts, issues, & balances being maintained in a chronological sequence, recording of movement & custody of such stocks as well as consumables inventory.

We recommend the maintenance of a priced stores ledger, and a formal procedure for reconciliation of factory & accounts related inventory records;

d. We are informed by the management that no material differences or discrepancies were noticed on physical verification of stocks.

3. a. The Company has not granted/taken any loans, secured or unsecured to/from the companies, firms of other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b. In respect of the debit balances and advances in the nature of loans, including amounts due on current accounts, no stipulations have been made as to repayments, and management expresses confidence in recovering the amounts due.

4. a. In our opinion, and according to the information and explanations given to us, there exist adequate internal control procedures 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.

b. Certain areas/procedures and control weaknesses identified during the course of internal/statutory audit and other reviews need to be considered for improvement and up-gradation to better levels.

c. While we have not observed any continuing failure of intent to correct identified weaknesses in internal controls during the course of our audit, observations made need to be comprehensively addressed and rectified.

5. a. According to the information and

explanations provided by the management, the transactions that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the explanations given to us, there are transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of five lakhs rupees in respect of any party during the year, at prices which are prima facie reasonable having regard to prevailing market prices.

6. In our opinion and explanations given to us, the Company has not invited or accepted any deposits from the public attracting the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed there under. No Order has been passed by the Company Law Board regarding compliance of above said provisions.

7. The Company presently has an internal audit conducted by an external agency, which needs to be reviewed for its depth & scope so as to make it commensurate with the size of the Company & the nature of its business.

8. We are informed that the Central Government has not prescribed maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956 for any products of the Company.

9. a. According to the records of the Company furnished to us the Company is regular in depositing undisputed statutory dues including, provident fund, employees state insurance, income tax, sales tax, customs duty, excise duty, cess and other material statutory dues with delays of nominal nature.

b. According to the information and explanations given by the management, there are no undisputed amounts payable in respect of income tax, sales tax, wealth tax, customs duty and excise duty and cess which were in arrears as at 31st March, 2010 for a period of more than six months from date they become payable.

10. In our opinion the accumulated losses (Profit and Loss Account balance) of the Company at the end of the financial year are not less than 50 % of its net worth. The Company has not incurred cash losses during the financial year covered by our audit, and also in the previous financial year.

11. In our opinion and according to the information and explanations given to us, there are no defaults on dues payable to institutions/bank/ others on the date of the Balance Sheet.

12. We are informed that the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

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

15. We are informed that the Company has not given any guarantees for loans taken by others from banks or financial institutions.

16. In our opinion, the term-loans availed have generally been applied for the purpose for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that during the report under review, short term funds (inclusive of cash generated from operations) of Rs.10.28 crore have been used for long term purpose.

18. According to information and explanations given to us, during the period covered by our audit report, the Company has not issued debentures.

19. According to information and explanations given to us, the Company has not raised monies by means of a public issue during the year. A preferential offer of 12,40,000 convertible share warrants (convertible into equity shares of Rs.10 each at a premium of Rs.30 per share) was made on preferential basis during the year. Refer Note 3(b).

20. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For PRATURI & SRIRAM Chartered Accountants (Firm Registration No. 002739S)

K. SRIRAM Hyderabad Partner

12th July, 2010 Membership No. 37821

 
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