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Auditor Report of Muller & Phipps (India) Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of Muller & Phipps (India) Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, 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 Standalone 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 standalone 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 adeaquate accounting records in accordance with the provisions of the Act for the safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give true and fair view and free from material misstatements, whether due to fraud or error.

Auditor's Responsibility

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's 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 controls 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 internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Basis for Qualified Opinion

The financial statements have been prepared on a going concern basis by the management although the net worth of the Company has been completely eroded and there are no profits from operational activities, on the basis that they have business plans for profitable operations in the future (Refer Note No. 40). However, no such plans have been shown or explained to us to our satisfaction and hence we are unable to form any opinion on the going concern status of the Company.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matters described in the Basis for Qualified Opinion paragraph above, the aforesaid standalone 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:

i. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2015;

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

iii. 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, 2015 ("the Order") issued by Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, 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 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 aforesaid standalone 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. The going concern matter described under the Basis of Qualification paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

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

g. 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, in our opinion and to the best of our information and according to the explanations given to us:

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

b. The Company did not have any long-term contract including derivative contracts for which there were any material for seeable losses.

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

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT

To the Members of Muller & Phipps (India) Limited

As referred to in Paragraph 1 under 'Report on Other Legal and Regulatory Requirements' in our Auditors' report of even date and as required by the Companies (Auditor's Report) Order, 2015, issued by the Central Government in terms of sub section (11) of section 143 of the Act, and on the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of the audit, we further report that: -

1. a) The Company has not maintained proper records to show full particulars, including quantitative details and situation of fixed assets.

b) No physical verification of fixed assets has been conducted by the management during the year or in the recent past. In our opinion, the frequency of verification needs to be improved to be commensurate with the size of the Company and the nature of its business.

2. a) The inventory has been physically verified by the management at reasonable intervals during the year.

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

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

3. The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013 ('the Act').

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have neither been informed nor have we observed any continuing failure to correct major weaknesses in internal controls.

5. The Company has not accepted any deposits from the public within the meaning of the provisions of Sections 73 to 76 or any other relevant provisions of the Act and Rules framed thereunder.

6. The Central Government has not prescribed maintenance of cost records under section 148(1) of the Companies Act, 2013, for any of the products of the Company

7. a) According to the information and explanations given to us and on the basis of the examination of the books of account carried out by us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess and other statutory dues, wherever applicable with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2015 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us by management and the records of the Company examined by us, there were no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service Tax, Excise duty and Cess which have not been deposited as on 31st March, 2015 except as stated below:

Nature of dues pending Amount Rs. Forum where dispute is

Income Tax A.Y 2001-02 10,57,725 Commissioner of Income-tax (Appeals)

Income Tax Penalty A.Y 2001-02 2,10,00,000 Commissioner of Income-tax (Appeals)

Sales Tax A.Y 2004-05 2,85,000 Sales Tax Authorities A.Y 2002-03 2,29,000 - Lucknow

Income Tax A.Y 2011-12 2,79,950 Commissioner of Income-tax (Appeals)

c) There were no amounts which were required to be transferred to the Investors Education and Protection Fund by the Company in accordance with the relevant provisions of the Act and the rules made thereunder.

8. The accumulated losses of the Company as at 31st March, 2015 are more than fifty percent of its net worth. It has not incurred cash losses during the financial year ended on that date but has incurred cash losses in the immediately preceding financial year.

9. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks and financial institutions during the year. The Company has not issued any debentures

10. According to the information given to us and as per the records examined by us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

11. The Company has not availed / utilized any term loan.

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

For Ford, Rhodes, Parks & Co.

Shrikant Prabhu Place : Mumbai Partner Date : 28th May, 2015 Membership No. 35296


Mar 31, 2014

We have audited the accompanying financial statements of Muller & Phipps (India) Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2014, 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, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

(b) in the case of the Statement of Profit and Loss, of the 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

The financial statements have been prepared on a going concern basis, although the net worth of the Company has been completely eroded, for reasons stated in the Note 38 of the Financial Statements.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by Central Government of India in terms of sub- section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

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

ANNEXURE TO THE AUDITORS'' REPORT

To the Members of Muller & Phipps (India) Limited Year ended 31st March, 2014

As required by the Companies (Auditor''s Report) Order, 2003 (the Order), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956 (the Act), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of the audit, we further report that: -

1. a) The Company has not maintained proper records to show full particulars, including quantitative details and situation of

fixed assets.

b) No physical verification of fixed assets has been conducted by the management during the year or in the recent past. In our opinion, the frequency of verification needs to be improved to be commensurate with the size of the Company and the nature of its business.

c) The Company has not disposed off a substantial part of fixed assets during the year so as to affect the going concern status of the Company.

2. a) The inventory has been physically verified by the management at reasonable intervals during the year.

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

c) In our opinion, the Company has maintained proper records of inventory.

d) The discrepancies between the physical inventory and the book records noticed on physical verification were not material and have 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 Act.

b) The Company had taken unsecured loans from a company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year was ''1,90,00,000 and the year end balance of such loans taken was ''1,85,00,000.

c) In our opinion, the rate of interest and other terms and conditions on which such loans have been taken are not, prima facie, prejudicial to the interest of the Company.

d) The Company is repaying the principal amounts of such loans as stipulated but has been irregular in the payment of interest.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have neither been informed nor have we observed any continuing failure to correct major weaknesses in internal controls.

5. a) On the basis of our examination of the books of account and according to the information and explanations provided by

the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements, and aggregating during the year to more than '' 5 lakhs in respect of each party, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and prices at which similar transactions have been made with other parties.

6. In our opinion and based on the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of the provisions of Sections 58A, 58AA or any other relevant provisions of the Act. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company had no internal audit system in operation during the year. In our opinion, the Company needs to have an internal audit system commensurate with the size of the Company and the nature of its business.

8. The Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, for any of the products of the Company.

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

carried out by us, the Company has been generally regular in depositing undisputed statutory dues including Provident

Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess and other statutory dues, wherever applicable with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 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 by management and the records of the Company examined by us, there were no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service Tax, Excise duty and Cess which have not been deposited as on 31st March, 2014 except as stated below:

Nature of dues pending Amount Forum where dispute is

Income Tax 10,57,725 Commissioner of Income-tax (A.Y 2001-2002) (Appeals)

Income Tax Penalty (A.Y 2001- 2002) 2,10,00,000 Commissioner of Income-tax Sales Tax (Appeals)

(F.Y 2004-2005) 2,85,000 Sales Tax Authorities - Lucknow

(F.Y 2002-2003) 2,29,000 sSales Tax Authorities - Lucknow

10. The accumulated losses of the Company as at 31st March, 2014 are more than fifty percent of its net worth. It has incurred cash losses during the financial year ended on that date and in the immediately preceding financial year.

11. Based on our audit procedures and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of its dues to any financial institution or bank. The Company has not issued any debentures.

12. As per the books and records of the Company examined by us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. Clause (xiii) of the Order is not applicable as the Company is not a chit fund company or nidhi / mutual benefit fund / society.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information given to us and as per the records examined by us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

16. The Company has not availed / utilized any term loan.

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. 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 during the year.

19. The Company has not issued any 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 and on the basis of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have neither come across nor have we been informed of any instance of fraud on or by the Company during the year.

For Ford, Rhodes, Parks & Co. Chartered Accountants Firm''s Registration No. 102860W

Shrikant Prabhu Place : Mumbai Partner Date : 17th May, 2014 Membership No. 35296


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Muller & Phipps (India) Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2013, 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, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

(b) in the case of the Statement of Profit and Loss, of the 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

The financial statements have been prepared on a going concern basis, although the net worth of the Company has been completely eroded, for reasons stated in the Note 39 of the Financial Statements.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by Central Government of India in terms of sub- section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e. on the basis of written representations received from the directors as on 31st March, 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.

As required by the Companies (Auditor''s Report) Order, 2003 (the Order), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956 (the Act), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of the audit, we further report that: -

1. a) The Company has not maintained proper records to show full particulars, including quantitative details and situation of

fixed assets.

b) No physical verification of fixed assets has been conducted by the management during the year or in the recent past. In our opinion, the frequency of verification needs to be improved to be commensurate with the size of the Company and the nature of its business.

c) The Company has not disposed off a substantial part of fixed assets during the year so as to affect the going concern status of the Company.

2. a) The inventory has been physically verified by the management at reasonable intervals during the year.

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

c) In our opinion, the Company has maintained proper records of inventory.

d) The discrepancies between the physical inventory and the book records noticed on physical verification were not material and have 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 Act.

b) The Company had taken unsecured loans, from a company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year was Rs. 1,70,00,000. and the yearend balance of such loan taken was Rs. 1,70,00,000.

c) In our opinion, the rate of interest and other terms and conditions on which such loans have been taken are not, prima facie, prejudicial to the interest of the Company.

d) The Company is repaying the principal amounts of such loans as stipulated but has been irregular in the payment of interest.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have neither been informed nor have we observed any continuing failure to correct major weaknesses in internal controls.

5. a) On the basis of our examination of the books of account and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements, and aggregating during the year to more than Rs. 5 lakhs in respect of each party, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and prices at which similar transactions have been made with other parties.

6. In our opinion and based on the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of the provisions of Sections 58A, 58AA or any other relevant provisions of the Act. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company had no internal audit system in operation during the year. In our opinion, the Company needs to have an internal audit system commensurate with the size of the Company and the nature of its business.

8. The Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, for any of the products of the Company.

9. a) According to the information and explanations given to us and on the basis of the examination of the books of account carried out by us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess and other statutory dues, wherever applicable with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2013 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us by management and the records of the Company examined by us, there were no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service Tax, Excise duty and Cess which have not been deposited as on 31st March, 2013 except as stated below:

Nature of dues pending Amount Rs. Forum where dispute is

Income Tax 10,57,725 Commissioner of Income-tax (Appeals). (A.Y 2001-2002)

Income Tax Penalty (A.Y 2001- 2002) 2,10,00,000 Commissioner of Income- tax (Appeals).

Sales Tax (F.Y. 2004-2005) 2,85,000 Sales Tax Authorities - Lucknow.

(F.Y. 2002-2003) 2,29,000 Sales Tax Authorities - Lucknow.

10. The accumulated losses of the Company as at 31st March, 2013 are more than fifty percent of its net worth. It has incurred cash losses during the financial year ended on that date and in the immediately preceding financial year.

11. Based on our audit procedures and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of its dues to any financial institution or bank. The Company has not issued any debentures.

12. As per the books and records of the Company examined by us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. Clause (xiii) of the Order is not applicable as the Company is not a chit fund company or nidhi / mutual benefit fund / society.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information given to us and as per the records examined by us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

16. The Company as not availed / utilized any term loan utilized.

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. 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 during the year.

19. The Company has not issued any 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 and on the basis of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have neither come across nor have we been informed of any instance of fraud on or by the Company during the year.

For Ford, Rhodes, Parks & Co.

Chartered Accountants

Firm''s Registration No. 102860W

Shrikant Prabhu

Partner

Mumbai : 13th August, 2013 Membership No.35296


Mar 31, 2012

1. We have audited the attached Balance Sheet of Muller & Phipps (India) Limited as at 31st March, 2012 and also the Statement of Profi t and Loss of the Company for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date. These fi nancial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these fi nancial statements based on our audit.

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

3. The fi nancial statements have been prepared on a going concern basis, although the net worth of the Company has been completely eroded, for reasons stated in Note no. 39 of the Notes to the fi nancial Statements.

4. As required by the Companies (Auditor's Report) Order, 2003, issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specifi ed in paragraphs 4 and 5 of the said Order

5. No confi rmation has been received from a foreign group entity for the net amount of ` 1,28,88,328 due from it and outstanding for more than two year which is shown as good and fully recoverable in the fi nancial statements In the absence of the confi rmation, we are unable to express an opinion on the recoverability of this amount.

6. Further to our comments in paragraph 3 above and also those contained in the Annexure referred to in paragraph 4 above and subject to the matter referred to in paragraph 5 above, we report that:

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

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

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

d) In our opinion, the Balance Sheet and Statements of Profi t and Loss dealt with by this report are in compliance with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956;

e) On the basis of the written representations received from the directors and from the public companies in which these directors are directors, which are taken on record by the Board of Directors, we report that none of the directors is disqualifi ed as on 31st March, 2012, from being appointed as a director in terms of Section 274 (1)(g) of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the fi nancial statements read with the notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

ii) in the case of the Statements of Profi t and Loss , of the Loss for the year ended on that date; and

iii) in the case of Cash Flow Statement, of the cash fl ows for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT TO THE MEMBERS OF MULLER & PHIPPS

(INDIA) LIMITED

(Referred to in paragraph 3 of our report of even date)

As required by the Companies (Auditor's Report) Order, 2003 (the Order), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956 (the Act), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of the audit, we further report that: -

1. a) The Company has not maintained proper records to show full particulars, including quantitative details and situation of

fi xed assets.

b) No physical verifi cation of fi xed assets has been conducted by the management during the year or in the recent past. In our opinion, the frequency of verifi cation needs to be improved to be commensurate with the size of the Company and the nature of its business.

c) The Company has not disposed off a substantial part of fi xed assets during the year so as to affect the going concern status of the Company.

2. a) The inventory has been physically verifi ed by the management at reasonable intervals during the year.

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

c) In our opinion, the Company has maintained proper records of inventory.

d) The discrepancies between the physical inventory and the book records noticed on physical verifi cation were not material and have been properly dealt with in the books of accounts.

3. a) The Company has not granted any loans, secured or unsecured, to companies, fi rms or other parties covered in the

register maintained under Section 301 of the Act.

b) The Company had taken unsecured loans, from a company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year was Rs 1,70,00,000. and the year end balance of such loan taken was Rs1,70,00,000.

c) In our opinion, the rate of interest and other terms and conditions on which such loans have been taken are not, prima facie, prejudicial to the interest of the Company.

d) The Company is repaying the principal amounts of such loans as stipulated and has been regular in the payment of interest.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fi xed assets and for the sale of goods and services. During the course of our audit, we have neither been informed nor have we observed any continuing failure to correct major weaknesses in internal controls.

5. a) On the basis of our examination of the books of account and according to the information and explanations provided by

the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements, and aggregating during the year to more than Rs 5 lakhs in respect of each party, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and prices at which similar transactions have been made with other parties.

6. In our opinion and based on the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of the provisions of Sections 58A, 58AA or any other relevant provisions of the Act. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company had no internal audit system in operation during the year. In our opinion, the Company needs to have an internal audit system commensurate with the size of the Company and the nature of its business.

8. The Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, for any of the products of the Company.

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

carried out by us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess and other statutory dues, wherever applicable with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2012 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us by management and the records of the company examined by us, there were no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service Tax, Excise duty and Cess which have not been deposited as on 31st March, 2012 except as stated below:

Nature of dues pending Amount Rs. Forum where dispute is

Income Tax Demand (A.Y 2001-2002) 1,21,74,633 Commissioner of

Income-tax (Appeals).

Income Tax Penalty Demand (A.Y 2001- 2002) 2,10,00,000 Commissioner of Income-tax (Appeals)

(A.Y2005 - 2006) 15,66,296 Commissioner of Income-tax (Appeals).

Sales Tax Demand

(F.Y 2004-2005) 285,000 Sales Tax Authorities - Lucknow.

(F.Y 2002-2003) 229,000 Sales Tax Authorities - Lucknow.

10. The accumulated losses of the Company as at 31st March, 2012 are more than fi fty percent of its net worth. It has incurred cash losses during the fi nancial year ended on that date although it has not incurred cash losses in the immediately preceding fi nancial year.

11. Based on our audit procedures and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of its dues to any fi nancial institution or bank. The Company has not issued any debentures.

12. As per the books and records of the Company examined by us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. Clause (xiii) of the Order is not applicable as the Company is not a chit fund company or nidhi / mutual benefi t fund / society.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information given to us and as per the records examined by us, the Company has not given any guarantee for the loans taken by others from banks or fi nancial institutions during the year.

16. On the basis of our review of utilisation of funds pertaining to term loans on overall basis and related information and explanations as made available to us, we are of the opinion that the term loans taken by the Company have been applied for the purposes for which they were obtained.

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. 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 during the year.

19. The Company has not issued any 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 and on the basis of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have neither come across nor have we been informed of any instance of fraud on or by the Company during the year.

For Ford, Rhodes, Parks & Co.

Chartered Accountants

Firms Registration No. 102860W

S.B. Prabhu

Partner

Mumbai : 24th August, 2012 Membership No.35296


Mar 31, 2011

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

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

3. The financial statements have been prepared on a going concern basis, although the net worth of the Company has been completely eroded, for reasons stated in Note no. 24 of the Notes to Accounts.

4. As required by the Companies (Auditor's Report) Order, 2003, issued by the Central Government 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

5. No confirmation has been received from a foreign group entity for the net amount of Rs. 2,37,43,810 due from it and outstanding for more than one year which is shown as good and fully recoverable in the financial statements. An amount of Rs.1,08,55,482 has been received subsequent to the year-end. In the absence of confirmation, we are unable to express an opinion on the recoverability of the balance amount of Rs. 1,28,88,328.

6. Further to our comments in paragraph 3 above and also those contained in the Annexure referred to in paragraph 4 above and subject to the matter referred to in paragraph 5 above, we report that:

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

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

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

d) In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report are in compliance with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956;

e) On the basis of the written representations received from the directors and from the public companies in which these directors are directors, which are taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2011, from being appointed as a director in terms of Section 274 (1 )(g) of the Companies Act, 1956;

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

i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011 ;

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

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

ANNEXURE TO THE AUDITORS' REPORT TO THE MEMBERS OF MULLER & PHIPPS (INDIA) LIMITED (Referred to in paragraph 3 of our report of even date)

As required by the Companies (Auditor's Report) Order, 2003 (the Order), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956 (the Act), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of the audit, we further report that: -

1. a) The Company has not maintained proper records to show full particulars, including quantitative details and situation of fixed assets.

b) No physical verification of fixed assets has been conducted by the management during the year or in the recent past. In our opinion, the frequency of verification needs to be improved to be commensurate with the size of the Company and the nature of its business.

c) The Company has not disposed off a substantial part of fixed assets during the year so as to affect the going concern status of the Company.

2. a) The inventory has been physically verified by the management at reasonable intervals during the year.

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

c) In our opinion, the Company has maintained proper records of inventory.

d) The discrepancies between the physical inventory and the book records noticed on physical verification were not material and have been properly dealt with in the books of accounts.

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 Act.

b) The Company had taken unsecured loans, from a company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year was ? 32,00,000. The loans were fully repaid during the year.

c) In our opinion, the rate of interest and other terms and conditions on which such loans have been taken are not, prima facie, prejudicial to the interest of the Company.

d) The Company has repaid the principal amounts of such loans as stipulated and has been regular in the payment of interest.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have neither been informed nor have we observed any continuing failure to correct major weaknesses in internal controls.

5. a) On the basis of our examination of the books of account and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of . such contracts or arrangements, and aggregating during the year to more than Rs. 5 lakhs in respect of each party, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and prices at which similar transactions have been made with other parties.

6. In our opinion and based on the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of the provisions of Sections 58A, 58AA or any other relevant provisions of the Act. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company had no internal audit system in operation during the year. In our opinion, the Company needs to have an internal audit system commensurate with the size of the Company and the nature of its business.

8. The Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, for any of the products of the Company.

9. a) According to the information and explanations given to us and on the basis of the examination of the books of account carried out by us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess and other statutory dues, wherever applicable with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31s1 March, 2011 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us by management and the records of the company examined by us, there were no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service Tax, Excise duty and Cess which have not been deposited as on 31st March, 2011 except as stated below :

Nature of dues pending Amount Rs. Forum where dispute is

Income Tax Demand 1,21,74,633 Commissioner of Income-tax (A.Y 2001-2002) (Appeals). Sales Tax Demand

(F.Y. 2004-2005) 285,000 Sales Tax Authorities - Lucknow.

(F.Y.2002-2003) 229,000 Sales Tax Authorities - Lucknow.

10. The accumulated losses of the Company as at 31st March, 2011 are more than fifty percent of its net worth. It has not incurred cash losses during the financial year ended on that date although it has incurred cash losses in the immediately preceding' financial year.

11. Based on our audit procedures and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of its dues to any financial institution or bank. The Company has not issued any debentures.

12. As per the books and records of the Company examined by us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. Clause (xiii) of the Order is not applicable as the Company is not a chit fund company or nidhi / mutual benefit fund / society.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information given to us and as per the records examined by us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

16. On the basis of our review of utilisation of funds pertaining to term loans on overall basis and related information and explanations as made available to us, we are of the opinion that the term loans taken by the Company have been applied for the purposes for which they were obtained.

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. 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 during the year.

19. The Company has not issued any 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 and on the basis of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have neither come across nor have we been informed of any instance of fraud on or by the Company during the year.

For Ford, Rhodes, Parks & Co.

Chartered Accountants Firm's Registration No. 102860W

S.B. Prabhu

Partner Membership No.35296

Mumbai: 2nd September, 2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of Muller & Phipps (India) 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 and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government 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.

4. The financial statements have been prepared on a going concern basis, although the net worth of the Company has been completely eroded, for reasons stated in Note no. 24 of the Notes to Accounts.

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

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

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

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

d) In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report are in compliance with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956;

e) On the basis of the written representations received from the directors and from the public companies in which these directors are directors, which are 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 Section 274 (1)(g) of the Companies Act, 1956;

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

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

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

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

ANNEXURE TO THE AUDITORS REPORT TO THE MEMBERS OF MULLER & PHIPPS (INDIA) LIMITED (Referred to in paragraph 3 of our report of even date)

As required by the Companies (Auditors Report) Order, 2003 (the Order), issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956 (the Act), and on the basis of such cheoks as we considered appropriate and according to the information and explanations given to us during the course of the audit, we further report that: -

1. a) The Company has not maintained proper records to show full particulars, including quantitative details and situation of fixed assets.

b) No physical verification of fixed assets has been conducted by the management during the year or in the recent past. In our opinion, the frequency of verification needs to be improved to be commensurate with the size of the Company and the nature of its business.

c) The Company has not disposed off a substantial part of fixed assets during the year so as to affect the going concern status of the Company.

2. a) The inventory has been physically verified by the management at reasonable intervals during the year.

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

c) In our opinion, the Company has maintained proper records of inventory.

d) The discrepancies between the physical inventory and the book records noticed on physical verification were not material and have been properly dealt with in the books of accounts.

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 Act.

b) The Company has taken unsecured loans, from a company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year was Rs.11,200,000/- and the year-end balance of such loans taken was Rs.5,700,000/-.

c) In our opinion, the rate of interest and other terms and conditions on which such loans have been taken are not, prima facie, prejudicial to the interest of the Company.

d) The Company is repaying the principal amounts of such loans as stipulated and is regular in the payment of interest.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have neither been informed nor have we observed any continuing failure to correct major weaknesses in internal controls.

5. a) On the basis of our examination of the books of account and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In. our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements, and aggregating during the year to more than Rs. 5 lakhs in respect of each party, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and prices at which similar transactions have been made with other parties.

6. In our opinion and based on the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of the provisions of Sections 58A, 58AA or any other relevant provisions of the Act. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7. The Company did not have any internal audit system in operation during the year under audit. In our opinion, the Company needs to put in place an internal audit system commensurate with the size of the Company and the nature of its business.

8. The Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, for any of the products of the Company.

9. a) According to the information and explanations given to us and on the basis of the examination of the books of account carried out by us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Excise Duty, Cess and other statutory dues, wherever applicable with the appropriate authorities. There were no undisputed arrears of statutory dues outstanding as at 31st March, 2010 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us by management and the records of the company examined by us, there were no disputed dues in respect of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service Tax, Excise duty and Cess which have not been deposited as on 31st March, 2010 except as stated below :

Nature of dues pending Amount Rs. Forum where dispute is

Income Tax Demand (A.Y 2001-2002) 1,28,74,309 Commissioner of Income-tax (Appeals) Sales Tax Demand

(F.Y. 2004-2005) 2,85,000 Sales Tax Authorities - Lucknow.

(F.Y. 2002-2003) 2,29,000 Sales Tax Authorities - Lucknow.

10. The accumulated losses of the Company as at 31st March, 2010 are more than fifty percent of its net worth. The Company has not incurred cash losses during the financial year ended on that date and in the immediately preceding financial year.

11. Based on our audit procedures and the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of its dues to any financial institution or bank. The Company has not issued any debentures.

12. As per the books and records of the Company examined by us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures and other securities.

13. Clause (xiii) of the Order is not applicable as the Company is not a chit fund company or nidhi / mutual benefit fund / society.

14. The Company is not dealing in or trading in shares, securities, debentures and other investments.

15. According to the information given to us and as per the records examined by us, the Company has not given any guarantee for the loans taken by others from banks or financial institutions during the year.

16. On the basis of our review of utilisation of funds pertaining to term loans on overall basis and related information and explanations as made available to us, we are of the opinion that the term loans taken by the Company have been applied for the purposes for which they were obtained.

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 beenused for long-term investment.

18. 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 during the year.

19. The Company has not issued any 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 and on the basis of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have neither come across nor have we been informed of any instance of fraud on or by the Company during the year.

For Ford, Rhodes, Parks & Co.

Chartered Accountants

Firms Registration No. 102860W



S.B. Prabhu

Partner

Mumbai :27,th August, 2010 Membership No.35296

 
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