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Auditor Report of Mount Shivalik Industries Ltd.

Jun 30, 2015

We have audited the accompanying financial statements of MOUNT SHIVALIK INDUSTRIES LIMITED ("the company"), which comprise the Balance Sheet as at 30th June 2015, the Statement of Profit and Loss for the year then ended, cash flow statement and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these financial statements that give a true and fair view of the financial position and financial performance 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 provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 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.

Auditor's Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and 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 true and fair view, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and 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 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 30th June 2015 and its Loss for the year ended on that date.

Emphasis of matter

Attention is drawn to note no 43 of the accompanying financial statements to the effect for the reason and in the circumstances stated by the management and notwithstanding also the accumulated losses of the company have exceeded the paid up capital and reserve & surplus causing the company to be registered with SICA. The financial statements have been considered justified as drawn up as a going concern.

Report on other Legal and Regulatory Requirements

1. Requirements of 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, are applicable and annexed herewith.

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 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 30th June, 2015, taken on record by the Board of Directors, none of the directors is disqualified as on 30th June, 2015, from being appointed as a director in terms of Section 164(2) of the Act.

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

i. The Company does not have any pending litigations which would impact its financial position except as stated in para vii (b) of CARO report attached herewith.

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

iii. There was amount of Rs 3,74,380/- which is related to FY 2006-07, which has been transferred by the Company to the Investor Education and Protection Fund.

Annexure to the Auditors' Report

[Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements' of our Report of even date to the members of MOUNT SHIVALIK INDUSTRIES LIMITED on the accounts of the company for the year ended 30th June, 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) In respect of its fixed assets:

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

(b) As explained to us, fixed assets have been physically verified by the management during the year in accordance with the phased programme of verification adopted by the management 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.

(ii) In respect of its inventory:

a) As explained to us, the inventories of finished goods, semi-finished goods, stores, spare parts and raw materials were physically verified at regular intervals (at the end of the year) by the Management. In case of inventories lying with third parties, certificates of stocks holding have been received.

b) In our opinion and according to the information and explanation given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business.

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

(iii) In respect of loans, secured or unsecured, granted to the parties covered in register maintained under section 189 of the Companies Act 2013:

(a) According to the information and explanations given to us, the Company has not granted any loans to companies, firms or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013; and therefore paragraph

(iii) of the Order is not applicable.

(iv) 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, fixed assets and for the sale of goods (and/services). During the course of our Audit, we have not observed any continuing failure to correct major weaknesses in internal control.

(v) The company has not received any public deposits during the year.

(vi) As informed to us, the Central Government has prescribed maintenance of cost records under sub- section (1) of Section 148 of the Act, in respect of the activities carried on by the Company. We have broadly reviewed the cost records maintained by the company and are of the opinion, prima facie, the prescribed cost records but however we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) In respect of statutory dues:

(a) According to the records of the company and information and explanations given to us, the Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, employees state insurance (ESI), Investor Education and Protection Fund, Income-tax, Tax deducted at sources, Tax collected at source, Professional Tax, Sales Tax, value added tax (VAT), Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it, with the appropriate authorities.

(b) According to the information and explanations given to us, there were no undisputed amounts payable in respect of Income-tax, Wealth Tax, Custom Duty, Excise Duty, sales tax, VAT, Cess and other material statutory dues in arrears /were outstanding as at 30th June, 2015 for a period of more than six months from the date they became payable except as stated hereunder

Name of the statute Nature of dues Amount

Central Sales Tax CST 84,66,78,493/-

Name of the statute Related period Forum

Central Sales Tax 2009-10 to 2013-14 CST Appellate Authority

(c) There were amounts of Rs 3,74,380/- related to FY 2006-07 which has been transferred by the Company to the Investor Education and Protection Fund.

(viii) The company does have the accumulated losses of Rs 26,05,89,501/- at the end of financial year and Rs 21,85,99,336/- in the last year. The company has incurred Cash loss of Rs 3,31,23,042/- during the financial covered by our Audit and Rs 13,88,82,867/- in immediately preceding financial year.

(ix) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions, banks and debenture holders.

(x) In our opinion, and according to the information and the explanation given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions during the year.

(xi) The company has not obtained any term loan during the year, so this para of order is not applicable.

(xii) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For R.K. Relan & Co Chartered Accountants (Firm Registration No. : 002267N)

HEMANT RELAN Partner (Membership No.:085317)

Place: New Delhi Date: 03rd December, 2015


Jun 30, 2014

We have audited the accompanying Financial Statements of Mount Shivalik Industries Limited ("the Company"), which comprise the Balance Sheet as at June 30, 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 Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

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 June 30, 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.

Emphasis of Matter

Attention is drawn to Note No. 43 of the accompanying Financial Statements to the effect that for the reasons and in the circumstances stated by the management and notwithstanding also that the accumulated losses of the Company have exceeded the paid up capital and reserves causing the Company to be registered with SICA, the Financial Statements have been considered justified as drawn up as a going concern.

Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

2. Further to our comments in the Annexure referred to in paragraph above, 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 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;

e. On the basis of written representations received from the Directors as on June 30, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on June 30, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT

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

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

(b) A major portion of the fixed assets have been physically verified by the Management during the year and there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies have been noticed on such physical verification as compared to the book records.

(c) The Company has not disposed off substantial part of fixed assets during the year and hence in our opinion going concern status of the Company is not affected.

2. (a) Physical verification has been carried out by the Management in respect of inventory at reasonable intervals including as on June 30, 2014, as per the records reviewed by us.

(b) Based on information and explanations given and the records produced, in our view, the procedures of physical verification of inventory followed by the Management during the year are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. As per the information furnished by the Management, no material discrepancy was observed between physical inventories and the book records, and the same has been properly dealt with in the books of account.

3. (a) According to the information and explanations given to us and based on such tests as we considered necessary, we report that the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 301 of the Act. Accordingly, the provisions of paragraph 4 (iii) (b), (c) and (d) of the Order are not applicable to the Company.

(b) According to the information and explanations given to us and based on such tests as we considered necessary, we report that the Company has not taken any loans from parties listed in the register maintained under section 301 of the Act. Accordingly, the provisions of paragraph 4 (iii) (f) and (g) of the Order are not applicable to the Company.

4. In our opinion and according to the information and explanations given to us during the course of audit, there are internal control systems, generally considered adequate, commensurate with the size of the Company and the nature of its business for the purchases of inventory, fixed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

5. (a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register required to be maintained under Section 301 of the Act have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register required to be maintained under Section 301 of the Act and exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58A, 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. According to the information and explanations given to us, no order under the aforesaid sections has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

7. The Company does not have an internal audit system commensurate with the size of the Company and nature of its business.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Act and are of the opinion that, prima facie, the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. (a) According to the information and explanations given to us and records of the Company examined by us, in our opinion, the Company is generally regular in depositing with appropriate authorities, the undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, sales-tax, wealth-tax, service-tax, custom-duty, excise-duty and other material statutory dues applicable to it. According to the information and explanations given to us, no undisputed amounts payable were outstanding as at June 30, 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, wealth-tax, service tax, custom duty and excise duty which have not been deposited on account of any dispute except as furnished hereunder:

Name of the Nature of Amount (Rs.) Period to which Forum where Statute the dues the amount dispute is relates pending Rajasthan VAT 60,77,72,122 2010-11 to 2013-14 Rajasthan Tax VAT Act, Board, Ajmer 2003

10. In our opinion, the accumulated losses of the Company are more than fifty percent of its net worth. Further, the Company has incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company does not have any debenture holders.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities, and accordingly, the maintenance of records in this regard is not relevant for the year.

13. The Company is not a chit fund or a nidhi/mutual benefit fund/society; and accordingly, the provisions of Paragraph 4 (xiii) of the Order are not applicable to the Company.

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

15. In accordance with the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information and explanations given to us, the term loans taken by the Company have 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 no funds raised on short-term basis have been used for long-term investment.

18. During the year the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

19. According to the information and explanations given to us, the Company has not issued any debentures. Therefore, the provisions of Paragraph 4 (xix) of the said Order are not applicable to the Company.

20. According to the information and explanations given to us, the Company has not raised any money by way of public issue during the year. Therefore, the provisions of Paragraph 4(xx) of the Order are not applicable to the Company.

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 K. C. Khanna & Co. Chartered Accountants Firm''s Registration No. 000481N

H-96, Connaught Circus, (Nitin K. Jain) New Delhi-110 001 Partner Dated : 3rd December, 2014 Membership No. 083084


Jun 30, 2013

Report on the Financial Statements

We have audited the accompanying Financial Statements of Mount Shivalik industries limited ("the Company"), which comprise the Balance Sheet as at June 30, 2013, and the Statement of Proft and Loss and Cash Flow Statement for the year then ended, and a summary of signifcant 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.

auditor''s 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 suffcient 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 June 30, 2013;

b) in the case of the Statement of Proft 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 fows for the year ended on that date.

emphasis of Matter

Attention is drawn to Note No. 41 of the accompanying Financial Statements to the effect that as at the year end, the net worth of the Company has been adversely affected due to the accumulated losses having exceeded the paid up capital; that the accounts have been drawn up on a going concern basis due to the reasons stated and effective steps taken by the management.

Based on the mitigating factors as explained by the management in the said Note, the management believes that the going concern assumption is appropriate.

Our opinion is not qualifed in respect of this matter. report on other legal and regulatory requirements

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

2. Further to our comments in the Annexure referred to in paragraph above, 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 Proft 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 Proft and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

e. On the basis of written representation received from the Directors as on June 30, 2013 and taken on record by the Board of Directors, none of the directors is disqualifed as on June 30, 2013 from being appointed as a Director in term of Clause (g) of Sub-section (1) of section 274 of the Act.

Mount Shivalik induStrieS liMited anneXure to the indePendent auditor''S rePort

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

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

b) A major portion of the fxed assets have been physically verifed by the Management during the year and there is a regular programme of verifcation which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies have been noticed on such physical verifcation as compared to the book records.

c) The Company has not disposed off substantial part of fxed assets during the year and hence in our opinion going concern status of the Company is not affected.

2. a) Physical verifcation has been carried out by the Management in respect of inventory at reasonable intervals including as on 30.06.2013, as per the records reviewed by us.

b) Based on information and explanations given and the records produced, in our view, the procedures of physical verifcation of inventory followed by the Management during the year are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The Company is maintaining proper records of inventory. As per the information furnished by the Management, no material discrepancy was observed between physical inventories and the book records, and the same has been properly dealt with in the books of account.

3. a) The Company has not granted any loans, secured or unsecured to companies, frms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956; and accordingly, clauses (iii) (b), (c) and (d) of the Companies (Auditor''s Report) Order, 2003, as amended by the Companies (Auditor''s Report) (Amendment) Order, 2004, are not applicable to the Company for the current year.

b) The Company has taken an unsecured loan by way of fxed deposit from a director as covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.13,00,000 and the year end balance of unsecured loan taken was Nil.

c) In our opinion, the rate of interest and other terms and conditions on which loan has been taken by the Company listed in the register maintained under section 301 of the Companies Act, 1956 are not prima facie, prejudicial to the interest of the Company.

d) The Company is regular in repaying the principal amount as stipulated and has been regular in the payment of interest as per the terms of the loan.

4. In our opinion and according to the information and explanations given to us during the course of audit, there are internal control systems, generally considered adequate, commensurate with the size of the Company and the nature of its business for the purchases of inventory and fxed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the contracts or arrangements that need to be entered into the register required to be maintained under Section 301 of the Companies Act, 1956 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register required to be maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rupees fve lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

7. in our opinion, the Company does not have an internal audit system commensurate with the size of the Company and nature of its business.

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that, prima facie, the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. a) According to the information and explanations given to us and records of the Company examined by us, in our opinion, the Company is generally regular in depositing with the appropriate authorities, the undisputed statutory dues including provident fund, investors education and protection fund, employees'' state insurance, income-tax, sales-tax, wealth-tax, service tax, custom duty, excise-duty, cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income-tax, sales-tax, wealth-tax, service tax, custom duty, excise-duty and cess were in arrears, as at 30.6.2013 for a period of more than six months from the date it became payable.

c) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, wealth-tax, service tax, custom duty, excise duty and cess which have not been deposited on account of any dispute.

10. In our opinion, the accumulated losses of the company are more than ffty percent of its net worth. Further, the company has incurred cash losses during the fnancial year covered by our audit and in the immediately preceding fnancial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any fnancial institution or bank. The Company does not have any debenture holders.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities, and accordingly, the maintenance of records in this regard is not relevant for the year.

13. The Company is not a chit fund or a nidhi/mutual beneft fund/society; and accordingly, the provisions of clause 4 (xiii) of the Companies (Auditor''s Report) Order, 2003 as amended by the Companies (Auditor''s Report) (Amendment) Order, 2004 are not applicable to the Company.

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 as amended by the Companies (Auditor''s Report) (Amendment) Order, 2004 are not applicable to the Company.

15. In accordance with the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or fnancial institutions.

16. In our opinion and according to the information and explanations given to us, the term loans taken by the Company have 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 no funds raised on short-term basis have been used for long-term investment.

18. During the year the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The Company did not have any outstanding debentures during the year.

20. The Company has not raised any money by 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 k.C. khanna & Co.

Chartered accountants

Firm registration no.000481n

h-96, Connaught Circus,

(nitin k. Jain)

new delhi-110 001 Partner

dated : december 2, 2013 Membership no. 083084


Mar 31, 2010

1. We have audited the attached Balance Sheet of MOUNT SHIVALIK INDUSTRIES LIMITED, as at 31s1 March, 2010 and the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. These 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, as amended by the Companies (Auditors Report) (Amendment) Order 2004, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, and on the basis of such further checks as we considered necessary and according to the information and explanations given to us, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

i) 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;

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

iii) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow statement dealt with by this report comply with the Accounting Standards referred to in Sub-section (3C) of section 211 of the Companies Act, 1956;

v) On the basis of written representations received from the Directors, as on 31st March, 2010, 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;

vi) As per the information available to us the Central Government has not yet issued notification for levy and collection of cess on the turnover of the Company for the purposes of Section 441A of the Compa- nies Act, 1956, and as such there is no cess payable by the Company for the year;

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

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010;

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

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

ANNEXURE TO THE AUDITORS REPORT (Referred to in paragraph 3 of our report of even date)

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

b) A major portion of the fixed assets have been physically verified by the Management during the year and there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. According to the information and explanations given to us, no material discrepancies have been noticed on such physical verification as compared to the book records.

c) The disposal of some of the fixed assets during the year, in our opinion, does not affect the going concern status of the Company.

2. a) Physical verification has been carried out by the Management in respect of inventory at reasonable intervals, as per the records reviewed by us.

b) Based on information and explanations given and the records produced, in our view, the procedures of physical verification of inventory followed by the Management during the accounting year are reason- able and adequate in relation to the size of the Company and the nature of its business.

c) The Company is maintaining proper records of inventory. As per the information furnished by the Management, no material discrepancy was observed between physical inventories and the book records, and the same has been properly dealt with in the books of account.

3 a) The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956; and accordingly, clauses (iii)(b), (c) and (d) of the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 are not applicable to the company for the current year.

b) The Company had taken an unsecured loan by way of Fixed Deposit from a Director covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount as well as the year-end balance of loan was Rs.39.09 lacs.

c) In our opinion, the rate of interest and other terms and conditions on which loan has been taken from a Director listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

d) The matured unsecured loan has been renewed during the year and the repayment of unsecured loans has not yet become due. The Company has been regular in the payment of interest.

4. In our opinion and according to the information and explanations given to us during the course of audit, there are internal control system, generally considered adequate, commensurate with the size of the Company and the nature of its business for the purchases of inventory and fixed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5. a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

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

6. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of sections 58A and 58AA and other relevant provisions of the companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. In our opinion, the Company does not have an internal audit system commensurate with the size of the Company and nature of its business.

8. As explained to us, the Central Government has not prescribed under Section 209(1 )(d) of the Companies Act, 1956, the maintenance of cost records in respect of the Companys business.

9. a) According to the information and explanation given to us and records of the Company examined by us, in our opinion the Company is generally regular in depositing with the appropriate authorities, the undisputed statutory dues including provident fund, investments education and protection Fund, em- ployees state insurance, income-tax, sales-tax, wealth-tax, service tax, custom duty, excise-duty, cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income-tax, sales-tax, wealth-tax, service tax, custom duty, excise duty and cess were in arrears, as at 31.3.2010 for a period of more than six months from the date they became payable.

c) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, wealth-tax, service tax, custom duty, excise duty and cess which have not been deposited on account of any dispute.

10. The company has neither accumulated losses at the end of the financial year nor incurred cash losses during the financial year and in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any bank. The Company has not taken loan from any financial institu- tions. The Company does not have any debenture holders.

12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities, and accordingly, the maintenance of records in this regard is not relevant for the year.

13. The Company is not a chit fund or a nidhi/mutual benefit fund/society and accordingly, the provisions of clause 4 (xiii) of the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 are not applicable to the Company.

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 are not applicable to the Company.

15. In accordance with the information and explanations given to us, the Company has not given any guaran- tees for loans taken by others from banks or financial institutions.

16. In our opinion and according to the information and explanations given to us, the term loans taken by the Company, have 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 no funds raised on short-term basis have been used for long-term investment.

18. During the year the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The Company did not have any outstanding debentures during the year.

20. The Company has not raised any money by 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 K.C. KHANNA & CO.,

Chartered Accountants

Firm Registration No. 000481N

(Nitin K. Jain)

Partner H-96, Connaught Circus, Membership No. 083084

New Delhi - 110 001.

DATED: September 3, 2010

 
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