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Auditor Report of N R Agarwal Industries Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of N R Agarwal Industries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information, which we have signed under reference to this report.

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

Auditor's Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made 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 control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31,2015, its"loss" and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to the following matters in the Notes to the financial statements:

a) Note No. 34(g) regarding Income Tax demand of Rs 18,67,30,693/- which has been disputed by the Company. The Company has filed an appeal before the appropriate authorities. The ultimate outcome of the matter cannot be determined and no provision for liability that may arise has been made in the financial statements. Accordingly, we are unable to comment on the impact on the financial statements resulting on such outcome.

b) Note No. 36 regarding the forfeiture of deposit given to a party amounting to Rs 12,000,000/- against which the Company has initiated legal proceedings and for which no provision has been made in the accounts.

c) Note No. 40 relating to managerial remuneration amounting to Rs 19,50,000/- which was paid in excess of the prescribed limits during the FY 2013-14 and for which an application for waiver is pending clearance of the Central Government.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015, (hereinafter referred to as the "Order") issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, and on the basis of such checks of the books of accounts and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure hereto, a statement on the matters specified in the paragraphs 3 and 4 of the said Order, to the extent applicable.

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

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

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

(c) The Balance Sheet and the Statement of Profit and Loss and the Cash Flow statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

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

i. The company has disclosed the impact of pending litigation on its financial position in its financial statements as referred to in Notes 34(g) and 36 to the financial statements.

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

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

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT

The Annexure referred to in our Independent Auditors' Report to the members of N R Agarwal Industries Limited ("the Company") for the year ended March 31,2015, we report that:

1) a) The Company has maintained proper records

showing full particulars, including quantitative details and situation of fixed assets except for assets under installation.

b) All the fixed assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

2) In respect of Inventories:

a) As explained to us the inventories of the company have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

c) According to the information and explanations given to us, the Company has maintained proper records of inventory. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to book records.

3) The Company has neither granted any loans to, nor taken any loans from, companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. In view of the foregoing, the question of reporting on Clause 3 (iii) of the said order does not arise.

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 with regard to purchases of fixed assets and with regard to the sale of goods and services. During the course of our audit, we have neither come across, nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

5) During the year, the Company has not accepted any fresh deposits from the public within the meaning of section 73 and 74 of the Act and the rules framed thereunder to the extent notified. The Company has complied with the applicable statutory provisions during the year under review, and has repaid all its existing depositors. There are no deposits outstanding as at the year end.

6) Although the Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act for any of the products manufactured by the Company, the management has prepared cost records. These records were broadly reviewed by us and we are of the opinion that, prima facie, proper records have been maintained. However, we are not required to and have not carried out any detailed examination of such accounts and records.

7) In respect of statutory dues:

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

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

b) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practices in India, as at March 31,2015, the following are the particulars of dues that have not been deposited on account of any dispute.

Name of the Name of dues Amount(Rs in lacs) Forum where dispute is Statute pending

Central Excise Excise Duty* 2,21,16,306 Appellate Authority - Act, 1944 CESTAT

Central Excise Custom Duty 34,90,152 Appellate Authority - Act, 1944 CESTAT

Income Tax Act, Income Tax 18,67,30,693 Appellate Authority - 1961 Commissioner of Income Tax

Name of the Financial year to which Statute the amount relates

Central Excise 2003-04 to 2013-14 Act, 1944

Central Excise 2013-14 to 2014-15 Act, 1944

Income Tax Act, 2006-07 to 2011-12 1961

*Out of the demand, a sum of Rs 17,05,071 was paid under protest.

c) According to the information and explanation given to us, the amounts required to be transferred to investor education and protection fund had been transferred within the stipulated time in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.

8) The company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year

9) According to the records of the Company examined by us and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institutions and banks. The Company did not have any Debentures outstanding during the year.

10) In our opinion, according to the information and explanations given to us, the Company has not given guarantees for loans taken by others from Banks & Financial Institutions. Hence, in our opinion, clause (x) of paragraph 3 of the Companies (Auditors Report) Order, 2015 is not applicable to the Company.

11) According to the information and explanations given to us and based on the records and documents produced before us, in our opinion, the terms loans have been applied for the purposes for which they were obtained.

12) During the course of our examination of the books of accounts and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanation given to us, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the management.

For Chaturvedi & Partners Chartered Accountants (Firm's Registration No. 307068E)

(Khyati M. Shah) (Partner) [Membership Number: 117510]

Mumbai, May 29, 2015


Mar 31, 2014

Report on the Financial Statements

We have audited the accompanying financial statements of N R Agarwal Industries Limited, ("the Company"), which comprise the Balance Sheet as at March 31,2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information, which we have signed under reference to this report.

Management''s Responsibility for the Financial Statements

The Company''s 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 principles generally accepted in India including 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 fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

We draw attention to:-

1. Note No. 31 (g) under contingent liabilities regarding Income Tax demand of Rs. 153,677,003/- which has been disputed by the Company. The Company has filed an appeal before the appropriate authorities. The ultimate outcome of the matter cannot be determined and no provision for liability that may result has been made in the financial statement. Accordingly, we are unable to comment on the impact of the outcome.

2. Note No. 33 under contingent liabilities regarding the forfeiture of deposit given to one party amounting to Rs. 12,000,000/- against which the company has initiated legal action.

3. Note No.9.2 regarding the non provision of outgoing charge amounting to Rs. 1,730,600/- payable against the new office premises. Had the said amount referred in 2 & 3 above been provided in the accounts, the profit would have been lower by Rs. 13,730,600/-.

4. Note No. 37(c) to the financial statement relating to managerial remuneration charged to profit & loss account statement of the current year. The excess of Rs. 1,950,000/- is subject to approval of the Central Government and Shareholders of the Company. Due to the payment of the said excess amount, the profit for the year is lower by an identical amount.

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

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

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report comply with the Accounting Standards notified under the Act read with the General Circular No.15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

(e) On the basis of the written representations received from the directors as on March 31,2014, taken on record by the Board of Directors, none of the directors are 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 Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in Paragraph 1 of "Report on Other Legal and Regulatory Requirements" section 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 except for the assets under installation.

b) All the assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

c) The fixed assets disposed of during the period, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2) a) As explained to us, the management, at reasonable intervals during the year, has physically verified the inventories.

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) The Company is maintaining proper records of inventory. As explained to us, no material discrepancies were noticed on physical verification of stocks as compared to book records.

3) The Company has neither granted nor taken any loans, secured or unsecured to/from Companies, firms or other parties listed in the Register maintained under Section 301 of the Companies Act, 1956. Accordingly, the clauses 4(iii)(b) to (g) of the Order are not applicable.

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

5) a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into a register in pursuance of Section 301 of the Act have been properly entered.

b) All the transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time and the nature of services rendered by such parties.

6) According to the information and explanations given to us, the Company has complied with the provision of Sections 58A and 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regards to the deposits accepted from the public. We have been informed that 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) In our opinion, the Company has an adequate internal audit system commensurate with the size and the nature of its business.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records.

9) In respect of statutory dues:

a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Custom Duty, Service Tax, Excise Duty, Cess and other material statutory dues have been generally regularly deposited with the appropriate authorities.

b) According to the information and explanations given to us, no undisputed amount payable in respect of Income Tax, Wealth Tax, Customs Duty, Service Tax and Cess were outstanding as at March 31,2014 for a period of more than six months from the date of becoming payable. Details of dues of Income Tax and Central Excise which have not been deposited as on March 31,2014 on account of disputes are given below:

Name of the statute Name of the dues Amount (Rs.) Central Excise Act, 1944 Excise duty 1,705,071*

Income Tax Act, 1961 Income Tax 153,677,003

Name of the statute Forum where Financial year to dispute is pending which the amount relates

Central Excise Act, 1944 Appellate Authority 2003-04 to 2009-10 up to Commissioner level

Income Tax Act, 1961 ITAT Appeal 2006-07 to 2009-10

*Paid under protest

10) The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

11) In our opinion and according to the information and explanations given to us, there have been defaults in repayment of dues to financial institution and banks during the year, which have been subsequently rescheduled by way of Corporate Debt Restructuring (CDR) Scheme. Consequent to the CDR Scheme coming into effect, the Company has not defaulted in repayment of principal and interest to the CDR lenders as on the balance sheet date.

12) In our opinion and according to the explanations given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13) In our opinion, the Company is not a chit fund/ nidhi / mutual benefit fund/society. Therefore, the provisions of clause (xiii) of paragraph 4 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. Therefore, the provisions of clause (xiv) of paragraph 4 of the Order are not applicable to the Company.

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

16) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

17) In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, we report that funds raised on short-term basis have not been used during the year for long-term investment.

18) The company has not made preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19) In our opinion and according to the information and explanations given to us, the Company has not issued any debentures during the year.

20) The Company has not raised any monies by way of public issues during the year.

21) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted accounting practices in India and according to the information & explanation given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For Chaturvedi & Partners Chartered Accountants (Firm''s Registration No. 307068E)

(Khyati M. Shah) (Partner) Membership Number: 117510 Mumbai, May 30, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of N R Agarwal Industries Limited, ("the Company"), which comprise the Balance Sheet as at March 31, 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

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 principles generally accepted in India including 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 financial statements that give a true fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these 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 misstatements.

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

We draw attention to:-

1. Note No. 32 (g) under contingent liabilities regarding Income Tax demand of Rs.108,445,192/-which has been disputed by the Company. The Company has filed an appeal before the appropriate authorities. The ultimate outcome of the matter cannot be determined and no provision for liability that may result has been made in the financial statement. Accordingly we are unable to comment on the impact of the same.

2. Note No. 34 under contingent liabilities regarding the forfeiture of deposit given to one of the party amounting to Rs. 12,000,000/- against which the company has initiated legal action.

3. Note No. 10.2 regarding the non provision of outgoing charge amounting to Rs.1,730,600/- payable against the new office premises. Had the said amount referred in 2 & 3 been provided in the accounts, the profit would have been lower by Rs.13,730,600/-

4. Note No. 39 to the financial statement relating to managerial remuneration charged to profit & loss account statement of the current year. The excess of Rs. 5,276,035/- is subject to approval of the Central Government and Shareholders of the Company.

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

(a) in the case of the balance sheet, of the state of affairs of the Company as at March 31, 2013.

(b) in the case of the statement of profit and loss, of the profit for the year ended on that date; and

(c) in the case of the cash flow statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

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

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

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

(b) in our opinion proper books of account as required by

law have been kept by the Company so far as appears from our examination of those books.

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

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

(e) on the basis of the written representations received from the directors as on March 31, 2013, taken on record by the Board of Directors, none of the directors are 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 Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT.

Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" 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 except for the assets under installation.

b) All the assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

c) The Company has not disposed off substantial part of its fixed assets, which affect the going concern status of the Company.

2) a) As explained to us, the management, at reasonable intervals during the year, has physically verified the inventories.

b) In our opinion and according to the information & explanations given to us, the procedures of physical verification of inventories 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 is maintaining proper records of inventory. As explained to us, no material discrepancies have been noticed on physical verification of stocks as compared to book records.

3) The Company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the clauses 4(iii) (b) to (g) of the Order are not applicable.

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

5) a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into a register in pursuance of Section 301 of the Act have been properly entered.

b) All the transactions have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and the nature of services rendered by such parties.

6) In our opinion and according to the information and explanation given to us, the Company has complied with the provision of Sections 58A & 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regards to the deposits accepted from the public. We have been informed that 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) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8) We have broadly reviewed the books of accounts maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the said records.

9) a) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practice in India, in our opinion, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees

State Insurance, Income Tax, Sales Tax, Custom Duty, Service Tax, Excise duty, Cess and other material statutory dues as applicable with the appropriate authorities

b) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practices in India, there are no dues of Income Tax, Wealth Tax, Customs Duty and Cess except Excise Duty which have not been deposited on account of any dispute.

10) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in immediately preceding financial year.

11) In our opinion and according to the information and explanation given to us, there have been defaults in repayment of dues to financial institution and banks during the year, which have been subsequently rescheduled by way of Corporate Debt Restructuring (CDR) Scheme, and accordingly, the Company could be said to have not defaulted in repayment of principal and interest to CDR lenders as on the balance sheet date.

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

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

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

15) In our opinion, and according to the information and explanation given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

16) In our opinion, on the basis of information and explanations given to us, the term loans were applied for the purpose for which they were raised.

17) In our opinion and 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 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, during the year the Company has not issued any debentures.

20) The Company has not raised any money through a public issue during the year.

21) During the course of our examination of the books & records of the Company carried out in accordance with the generally accepted accounting practices in India & according to the information & explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For Chaturvedi & Partners

Firm Registration No. 307068E

Chartered Accountants

G.Venkatakrishnan

Partner

Membership Number: 11255

Mumbai May 30, 2013


Mar 31, 2012

1) We have audited the attached Balance Sheet of N R AGARWAL , INDUSTRIES LIMITED as at March 31,2012, the Statement of Profit and Loss and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3) As required by the Companies (Auditor's Report) Order, 2003 and the Companies (Auditor's 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, we enclose in the Annexure, a statement on the matters specified in paragraph 4 & 5 of the said Order.

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

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

b) In our opinion, the Company has kept proper books of account as required by law 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) Attention is invited to note no.32(g) under contingent liabilities regarding Income Tax demand of Rs 119,756,754 which has been disputed by the Company. The Company has filed an appeal before the appropriate authorities. The ultimate outcome of the matter cannot be determined and no provision for liability that may result has been made in the financial statement. Accordingly we are unable to comment on the impact of the same.

e) Attention is invited to note no.32(h) under contingent liabilities regarding the forfeiture of deposit given to one of the party against which the Company has initiated legal action. Had the said amount been provided in the accounts, the profit would have been lower by Rs 12,000,000.

f) In our opinion, the Balance Sheet, Statement of Profit and Loss 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.

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

h) In our opinion and to the best of our information and according to the explanations given and management representations made to us, the said accounts read together with the notes thereon give the information required by the Companies Act, ) 956, 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, 2012.

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 Flow for the year ended on that date.

1) a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets except for the assets under installation.

b) All the assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

c) The Company has not disposed off substantial part of its fixed assets, which affect the going concern status of the Company.

2) a) As explained to us, the management, at reasonable intervals during the year, has physically verified the inventories.

b) In our opinion and according to the information & explanations given to us, the procedures of physical verification of inventories 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 is maintaining proper records of inventory. As explained to us, no material discrepancies have been noticed on physical verification of stocks as compared to book records.

3) The Company has neither granted nor taken any loans, secured or unsecured to and from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the Clauses 4(iii)(b) to (g) of the Order are not applicable.

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

5) a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into a register in pursuance of Section 301 of the Act have been properly entered.

b) All the transactions have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and the nature of services rendered by such parties.

6) In our opinion and according to the information and explanation given to us, the Company has complied with the provision of Section 58A & 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regards to the deposits accepted from the public. We have been informed that 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) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

We have not, however, made a detailed examination of the said records.

9) a) According to the books of account and records as

produced and examined by us in accordance with the generally accepted auditing practice in India, in our opinion, the Company is regular in depositing , undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Custom Duty, Sen/ice Tax, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities.

b) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practices in India, there are no dues of Income Tax, Wealth Tax, Customs Duty and Cess expect Excise Duty which have not been deposited on account of any dispute. The particulars of dues of Income Tax as at March 31, 2012 which have not been deposited on account of dispute is as follows:

Name of the statute Name of the Amount(Rs) Forum where dispute dues pending

Central Excise Act, 1944 Excise duty 1,705,071* Appellate Authority up to Commissioner level

Income Tax Act,1961 Income Tax 119,756,754 CIT Appeal



Name of the statute Financial Year to which the amount relates

Central Excise 2003-04 to 2009-10 Act,1944

Income Tax Act, 1961 2004-05 to 2010-11

* Paid under protest

10) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in immediately preceding financial year.

11) On the basis of certificate issued, by the term lending bankers, the Company has not defaulted the repayment of dues to them, during the year.

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

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

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

15) In our opinion, and according to the information and explanation given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

16) In our opinion, on the basis of information and explanations given to us, the term loans were applied for the purpose for which they were raised.

17) In our opinion and 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 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, during the year the Company has not issued any debentures.

20) The Company has not raised any money through a public issue during the year.

21) During the course of our examination of the books & records of the Company carried out in accordance with the generally accepted accounting practices in India & according to the information's and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For CHATURVEDI & PARTNERS

Chartered Accountants

Firm's Registration No. 307068E

G. VENKATAKRISHNAN

(Partner)

Membership No. 11255

Mumbai, May 25, 2012


Mar 31, 2011

1) We have audited the attached Balance Sheet of N R AGARWAL INDUSTRIES LIMITED as at March 31,2011, 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 Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3) As required by the Companies (Auditor's Report) Order 2003 and the Companies (Auditor's 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, we enclose in the Annexure, a statement on the matters specified in paragraph 4 & 5 of the said Order.

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

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

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

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

d) 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.

e) On the basis of written representations received from the directors as on March 31, 2011, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2011 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

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

i) In the case of the Balance Sheet, of the state of affairs of the company as at 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 the Cash Flow Statement, of the "Cash Flow" 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 except for the assets under installation.

b) All the assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

c) The Company has not disposed off substantial part of its fixed assets, which affect the going concern status of the Company.

2) a) As explained to us, the management, at reasonable intervals during the year, has physically verified the inventories.

b) In our opinion and according to the information & explanations given to us, the procedures of physical verification of inventories 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 is maintaining proper records of inventory. As explained to us, no material discrepancies have been noticed on physical verification of stocks as compared to book records.

3) The Company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the clauses 4(iii) (b) to (g) of the Order are not applicable.

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

5) a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into a register in pursuance of section 301 of the Act have been properly entered.

b) All the transactions have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and the nature of services rendered by such parties.

6) In our opinion and according to the information and explanation given to us, the Company has complied with the provision of section 58A & 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regards to the deposits accepted from the public. We have been informed that 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) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the said records.

9) a) According to the books of account and records as produced and examined by us in accordance with the generally accepted auditing practice in India, in our opinion, the Company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Custom Duty, Service Tax, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities.

b) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practices in India, as at March 31, 2011, the following are the particulars of dues that have been paid under protest on account of dispute.

Name of the statue Name of the dues Amount(Rs.) Forum where dispute is pending

Central Excise Act, Excise duty 1,643,254 Appellate Authority up to 1944 Commissioner level

Name of the Statue Financial year to which the amount relates

Central Excise Act, 2003-04 to 2009-10 1944

10) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in immediately preceding financial year.

11) On the basis of certificate issued by the term lending bankers, the Company has not defaulted the repayment of dues to them, during the year.

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

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

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

15) In our opinion and according to the information and explanation given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

16) In our opinion, on the basis of information and explanations given to us, the term loans were applied for the purpose for which they were raised.

17) In our opinion and 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 preferential allotment of shares to parties and Companies covered in the register maintained under section 301 of the Companies Act,1956.

19) According to the information and explanations given to us, during the year the Company has not issued any debentures.

20) The Company has not raised any money through a public issue during the year.

21) During the course of our examination of the books & records of the Company carried out in accordance with the generally accepted accounting practices in India & according to the information & explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For CHATURVEDI & PARTNERS Chartered Accountants Firm's Registration No. 307068E

G. VENKATAKRISHNAN (Partner) Membership No. 11255

Mumbai, March 31, 2011


Mar 31, 2010

1) We have audited the attached Balance Sheet of N R AGARWAL INDUSTRIES LIMITED as at 31st March, 2010, 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 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 and the Companies (Auditor’s 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, we enclose in the Annexure, a statement on the matters specified in paragraph 4 & 5 of the said Order.

4) Attention is invited to Note No. 4(B) of Schedule “Q” annexed to and forming part of Accounts, regarding write back of excess provision for Gratuity & Leave Encashment. Had the assumptions followed in the previous year continued, the provision for Gratuity & Leave encashment (included in Schedule “K”) would have been higher by Rs. 12,33,796/- and Rs.86,09,424/- respectively and the net profit before tax would have been lower by Rs.35,48,539/-.

5) Further to our comments in the Annexure referred to above, we report that:

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

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

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

d) 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.

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

f) In our opinion and to the best of our information and according to the explanations given and management representations made to us, the said accounts subject to para 4 above 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 the Cash Flow statement, of the Cash Flow 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 except for the assets under installation.

b) All the assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

c) The Company has not disposed off substantial part of its fixed assets, which affect the going concern status of the Company.

2) a) As explained to us, the management, at reasonable intervals during the year, has physically verified the inventories.

b) In our opinion and according to the information & explanations given to us, the procedures of physical verification of inventories 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 is maintaining proper records of inventory. As explained to us, no material discrepancies have been noticed on physical verification of stocks as compared to book records.

3) The Company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the clauses 4(iii) (b) to (g) of the Order are not applicable.

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

5) a) In our opinion and according to the information’s and explanations given to us, the transactions that need to be entered into a register in pursuance of section 301 of the Act have been properly entered.

b) All the transactions have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time and the nature of services rendered by such parties.

6) In our opinion and according to the information and explanation given to us, the Company has complied with the provision of section 58A & 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regards to the deposits accepted from the public. We have been informed that 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) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956. We are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the said records.

9) a) According to the books of account and records as produced and examined by us in accordance with the generally accepted auditing practice in India, in our opinion, the Company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Custom Duty, Service Tax, Excise duty, Cess and other material statutory dues as applicable with the appropriate authorities.

b) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practices in India, as at 31st March 2010, the following are the particulars of dues that have not been deposited on account of any dispute.

Name of the statute Name of the dues Amount (Rs)

Central Excise Act, 1944 Excise duty 16,03,148

Central Excise Act, 1944 Excise duty 1,01,923

Name of the statute Forum where dispute is Financial year to which the pending amount relates

Central Excise Act,1944 Appellate Authority up to 2003-04 to 2008-09

Commissioner level

Central Excise Act,1944 Appellate Authority Up to 2009 -10

Commissioners level



10) The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in immediately preceding financial year.

11) On the basis of certificate issued by the term lending bankers, the company has not defaulted the repayment of dues to them during the year.

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

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

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

15) In our opinion, the terms and conditions on which the Company has given guarantees for loans taken by others from banks & financial institutions are prima facie, not prejudicial to the interest of the Company.

16) In our opinion, on the basis of information and explanations given to us, the term loans were applied for the purpose for which they were raised.

17) In our opinion and 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, during the year the company has not issued any debentures.

20) The company has not raised any money through a public issue during the year.

21) During the course of our examination of the books & records of the Company carried out in accordance with the generally accepted accounting practices in India & according to the information’s & explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For CHATURVEDI & PARTNERS

Chartered Accountants

Firms Registration No. 307068 E

G. VENKATAKRISHNAN

Mumbai (Partner)

Dated : 29.07.2010 Membership No. 11255