Home  »  Company  »  PI Industries  »  Quotes  »  Auditor Report
Enter the first few characters of Company and click 'Go'

Auditor Report of PI Industries Ltd.

Mar 31, 2015

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of PI INDUSTRIES LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2015, and 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 Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in sub-section 5 of Section 134 of the Companies Act, 2013 ("the Act") with respect to the preparation 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 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 standalone 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 standalone 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 sub-section 10 of Section 143 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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone 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 standalone 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.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, 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, of the state of affairs of the Company as at March 31, 2015 and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section 11 of Section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraphs 3 and 4 of the Order.

2. As required by sub-section 3 of Section 143 of the Act, we report that:

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

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

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

(d) In our opinion, the aforesaid 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) 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 are disqualified as on March 31, 2015 from being appointed as a Director in terms of sub-section 2 of Section 164 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 litigations on its financial position in its standalone financial statements (Refer Note No. 39 of the Standalone Financial Statement).

(ii) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts. The Company did not have any long-term derivative contracts.

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

The Annexure referred to in our paragraph "Report on other legal and Regulatory Requirements" report to the members of PI INDUSTRIES LIMITED ("the Company") for the year ended March 31, 2015.

We report that

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

(b) The Company has a phased programme of physical verification of its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. In accordance with this program, certain fixed assets were physically verified by the Management during the year and no material discrepancies were noticed on such verification as compared to the books of accounts.

(ii) (a) The inventory has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations 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 nature of its business.

(c) In our opinion, the Company is maintaining proper records of inventory. As far as we could ascertain and according to the information and explanations given to us, no material discrepancies were noticed between the physical stock and the book records.

(iii) According to the information and explanations given to us, 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. Accordingly, clause (iii) (a) and (b) of paragraph 3 of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, 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 inventory and fixed assets and the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

(v) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under with regard to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal in this regard.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government of India for the maintenance of cost records under sub-section 1 of Section 148 of the Companies Act, 2013, in respect of the manufacture of insecticides and chemicals and are of the opinion that, prima facie, the prescribed records and accounts have been made and maintained. However, we have not carried out a detailed examination of such records with a view to determining whether they are accurate or complete.

(vii) (a) According to the records of the Company examined by us and the information and explanations given to 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, Service Tax, Wealth Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other material statutory dues to the extent applicable to it.

According to the information and explanations given to us, no undisputed statutory dues payable in respect of Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess, and other material statutory dues were in arrears as at March 31, 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, there are no dues of Sales Tax, Income Tax, Duty of Customs, Service Tax, Wealth Tax, Duty of Excise, Value Added Tax and Cess which have not been deposited on account of any dispute, other than the following:-

Nature of Statute Nature of Period (F.Y.) Dues

Andhara Pradesh General Sales Sales Tax 2001-02 Tax Act

Andhara Pradesh General Sales Sales Tax 2003-04 Tax Act

West Bengal Sales Tax Act Sales Tax 2003-04

Assam Value Added Tax Act VAT 2007-08

Income Tax Act Income Tax Assessment Year 2009-10

Income Tax Act Income Tax Assessment Year 2010-11

Income Tax Act Income Tax Assessment Year 2011-12

Income Tax Act Income Tax Assessment Year 2012-13

Central Excise Act Excise Duty 1987-88

Central Excise Act Cenvat Credit April, 2008 to February, 2011

Central Excise Act Cenvat Credit July, 2007 to February, 2008

Central Excise Act Cenvat Credit July, 2013 to February, 2014

Central Excise Act Cenvat Credit March, 2011 to June, 2013

Custom Act Custom Duty 2008

Custom Act Anti Dumping 2009-10 & 2010-11 Duty

Nature of Statute Amount Forum where pending (Excluding interest) (Rs. in Lacs) *

Andhara Pradesh General Sales Tax Act 8.62 Andhara Pradesh Tribunal

Andhara Pradesh General Sales Tax Act 10.02 Andhara Pradesh Tribunal

West Bengal Sales Tax Act 15.93 Joint Commissioner (Appeal) Kolkatta

Assam Value Added Tax Act 1.12 Joint Commissioner Guwahati

Income Tax Act 243.06 Appellate Tribunal

Income Tax Act 293.36 Appellate Tribunal

Income Tax Act 153.03 Appellate Tribunal

Income Tax Act 96.11 Commissioner of Income Tax (Appeal)

Central Excise Act 44.92 ** Rajasthan High Court

Central Excise Act 19.93 Commissioner of custom (Appeal)

Central Excise Act 21.44 Commissioner of custom (Appeal)

Central Excise Act 24.95 Joint Commissioner

Central Excise Act 159.17 Customs, Excise & service tax Appellate Tribunal

Custom Act 446.86 Customs, Excise & service tax Appellate Tribunal

Custom Act 230.44 Hon''ble Supreme court of India

* Amount shown as due is net of amounts already deposited on appeal

** Fixed deposit receipt lodged with Rajasthan Excise Department

(c) According to the information and explanations given to us, the Company did not have any dues on account of Investor Education and Protection Fund.

(viii) The Company does not have accumulated losses as at the end of the financial year. There are no cash losses during the financial year under report and in the immediately preceding financial year.

(ix) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company has not defaulted in repayment of dues to any financial institution or bank during the year.

(x) According to the information and explanations given to us, the Company has given a counter guarantee of Rs. 32.85 lacs in favour of Gujarat Industrial Development Corporation Limited (GIDC) in relation to the corporate guarantee provided by GIDC for availment of term loans by Bharuch Eco-Aqua Infrastructure Limited, the terms and conditions whereof are not, prima facie, prejudicial to the interest of the Company.

(xi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the term loans taken by the Company have been applied for the purpose for which they were obtained.

(xii) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, 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 S.S. KOTHARI MEHTA & CO.

Chartered Accountants

Firm Reg. No. 000756N Sd/-

Yogesh K. Gupta

Place: Gurgaon Partner

Date: May 23, 2015 Membership No. 93214


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of PI Industries Limited, which comprise the Balance Sheet as at March 31, 2013, and 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 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 controls 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 the 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 reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 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") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

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

e) on the basis of written representations received from the directors as on March 31,2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of Clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

Re: PI Industries Limited

Referred to in paragraph "Report on Other Legal and Regulatory Requirements" of our report of even date,

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

(b) The Company has a phased programme of physical verification of its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. In accordance with this program, certain fixed assets were physically verified by the management during the year and no material discrepancies were noticed on such verification as compared to the books of accounts.

(c) In our opinion and according to the information and explanations given to us, no substantial part of fixed assets has been disposed off by the Company during the year.

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

(b) In our opinion and according to the information and 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 nature of its business.

(c) In our opinion, the Company is maintaining proper records of inventory. As far as we could ascertain and according to the information and explanations given to us, no material discrepancies were noticed between the physical stock and the book records.

(iii) (a) As per the information & explanations given to us, the Company has not granted loan to any party covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the Clause 4(iii) b, c & d of the order are not applicable.

(b) The Company has taken unsecured loans from four parties covered in the register maintained under section 301 of the Companies Act 1956. In respect of the said loans, the maximum amount outstanding at any time during the year is Rs. 1320 Lacs and the year-end balance is Rs. Nil Lacs.

(c) In our opinion and according to the information & explanations given to us, the rate of interest and other terms and conditions of such loans, unsecured, are not prima facie prejudicial to the interest of the Company; and

(d) In respect of loans taken repayable on demand, repayment of the principal amount has been made.

(iv) In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, 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 inventory and fixed assets and the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

(v) According to the information and explanations provided by the Management and based upon audit procedures performed, we are of the opinion that 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 and the transactions made in pursuance of such contracts or arrangements (exceeding the value of five lacs rupees in respect of each party during the financial year) have been made at prices which are generally reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58A and 58AA or any other relevant provisions of the Act and the rules framed there under with regard to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal in this regard.

(vii) In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government of India for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956, in respect of the manufacture of insecticides and chemicals and are of the opinion that, prima facie, the prescribed records and accounts have been made and maintained. However, we have not carried out a detailed examination of such records with a view to determining whether they are accurate or complete.

(ix) (a) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income tax, Sales tax, Service tax, Wealth tax, Customs duty, Excise Duty, Cess and any other material statutory dues to the extent applicable to it and there are no such undisputed statutory dues payable for a period of more than six months from the date they become payable as at March 31, 2013.

(b) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, service tax, wealth tax, Excise Duty and cess which have not been deposited on account of any dispute, other than the following:-

Nature of Statute Nature of Dues Period (F.Y.)

Gujarat General Sales Sales Tax 1995-96 Tax, 1969

Gujarat General Sales Sales Tax 1996-97 Tax, 1969

Andhra Pradesh General Sales Tax 2001-02 Sales Tax Act

Andhra Pradesh General Sales Tax 2003-04 Sales Tax Act

West Bengal Sales Tax Sales Tax 2003-04 Act

Assam Value Added VAT 2007-08 Tax Act

Income Tax Act Income Tax Assessment Year 2009-10

Income Tax Act Income Tax Assessment Year 2010-11

Custom Act Anti Dumping Duty 2009-2010 & 2010-2011

Central Excise Act Excise Duty 1987-88

Nature of Statute Amount Forum where pending (Excluding interest) (Rs. in Lacs) *

Gujarat General Sales Tax 1969 2.15 Assessing Authority-Bharuch

Gujarat General Sales Tax 1969 1.65 Assessing Authority-Bharuch

Andhra Pradesh General Sales Tax Act 8.62 Andhra Pradesh Tribunal

Andhra Pradesh General Sales Tax Act 10.02 Andhra Pradesh Tribunal

West Bengal Sales Tax Act 15.93 Joint Commissioner (Appeal) Kolkatta

Assam Value Added Tax Act 1.12 Joint Commissioner Guwahati

Income Tax Act 243.06 Appelate Tribunal

Income Tax Act 173.36 Commissioner of Income Tax (Appeal)

Custom Act 230.44 Hon''ble Supreme Court of India

Central Excise Act 44.92 ** Rajasthan High Court

* Amount shown as due is net of amounts already deposited on appeal

** Fixed deposit receipt lodged with Rajasthan Excise Department

(x) The Company does not have accumulated losses as at the end of the financial year. There are no cash losses during the financial year under report and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company has not defaulted in repayment of dues to any financial institution or bank during the year.

(xii) In our opinion and according to the information and 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.

(xiii) 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 CARO, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanation given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause 4(xiv) of the CARO, 2003 are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has given a counter guarantee of Rs.32.85 lacs in favour of Gujarat Industrial Development Corporation Limited (GIDC) in relation to the corporate guarantee provided by GIDC for availment of term loans by Bharuch Eco-Aqua Infrastructure Limited, the terms and conditions whereof are not, prima facie, prejudicial to the interest of the Company.

(xvi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the term loans taken by the Company have been applied for the purpose for which they were obtained.

(xvii) According to the information and explanations given to us and as per books and records examined by us, on the basis of an overall examination of the Balance Sheet of the Company, the funds raised by the Company on short-term basis, have not been applied for long-term purposes.

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

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

(xx) The Company has raised Rs.117,32.70 Lacs (19,24,656 equity share of Rs.5 each at a premium of Rs. 604.60 per share) through Qualified Institutional Placement during the year. The utilization of the money is disclosed by the Company and verified by us.

(xxi) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, 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 S.S. KOTHARI MEHTA & CO.

Chartered Accountants

Firm Reg. No. 000756N

Sd/-

Yogesh K. Gupta

Place: Gurgaon Partner

Date: May 18, 2013 Membership No. 93214


Mar 31, 2012

1. We have audited the attached Balance Sheet of PI INDUSTRIES LIMITED, as at 31st March, 2012, and also the Profit and Loss account and 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 the 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 as amended by the Companies (Auditors' Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

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

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

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

(iv) In our opinion, the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

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

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

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

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

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

Annexure

Re: PI Industries Limited

Referred to in paragraph 3 of our report of even date,

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

(b) The Company has a phased programme of physical verification of its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. In accordance with this program, certain fixed assets were physically verified by the management during the year and no material discrepancies were noticed on such verification as compared to the books of accounts.

(c) In our opinion and according to the information and explanations given to us, no substantial part of fixed assets has been disposed off by the Company during the year except selling off its Polymer division (Refer Note No. B-30), however it has not affected going concern.

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

(b) In our opinion and according to the information and 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 nature of its business.

(c) In our opinion, the Company is maintaining proper records of inventory. As far as we could ascertain and according to the information and explanations given to us, no material discrepancies were noticed between the physical stock and the book records.

(iii) (a) As per the information & explanations given to us, the company has not granted loan to any party covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly , the clause 4(iii) b, c & d of the order are not applicable.

(b) The Company has taken unsecured loans from two parties covered in the register maintained under section 301 of the Companies Act 1956. In respect of the said loans, the maximum amount outstanding at any time during the year is Rs. 485.00 Lacs and the year-end balance is Rs 370.00 Lacs.

(c) In our opinion and according to the information & explanations given to us, the rate of interest and other terms and conditions of such loans, unsecured, are not prima facie prejudicial to the interest of the company; and

(d) In respect of loans taken repayable on demand, repayment of the principal amount has been made as demanded and payment of interest is regular as stipulated.

(iv) 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 purchase of inventories and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, 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 a major weakness in the aforesaid internal control systems.

(v) According to the information and explanations provided by the Management and based upon audit procedures performed, we are of the opinion that 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 and the transactions made in pursuance of such contracts or arrangements (exceeding the value of five lacs rupees in respect of each party during the financial year) have been made at prices which are generally reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 58A and 58AA or any other relevant provisions of the Act and the rules framed there under with regard to deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal in this regard.

(vii) In our opinion, the Company has an internal audit system commensurate with the size of the company and nature of its business.

(viii)We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government of India for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956, in respect of the manufacture of insecticides and chemicals and are of the opinion that, prima facie, the prescribed records and accounts have been made and maintained. However, we have not carried out a detailed examination of such records with a view to determining whether they are accurate or complete.

(ix) (a) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income tax, Sales tax, Service tax, Wealth tax, Customs duty, Excise duty, Cess and any other material statutory dues to the extent applicable to it and there are no such undisputed statutory dues payable for a period of more than six months from the date they become payable as at 31st March,2012

(b) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, service tax, wealth tax, excise duty and cess which have not been deposited on account of any dispute, other than the following:-

Nature of Statute Nature of Dues Period (F.Y)

Gujarat General Sales Tax Act, 1969 Sales Tax 2001-02

Gujarat General Sales Tax, 1969 Sales Tax 1995-96

Gujarat General Sales Tax, 1969 Sales Tax 1996-97

Gujarat General Sales Tax, 1969 Sales Tax 2003-04

Central Sales Tax (Gujarat) Rules' Sales Tax 2003-04 1970

Andhara Pradesh General Sales Tax Sales Tax 2001-02 Act

Andhara Pradesh General Sales Tax Sales Tax 2003-04 Act

West Bengal Sales Tax Act Sales Tax 2003-04

Assam Value Added Tax Act VAT 2007-08

Assessment Income Tax Act Income Tax Year 2009-10

2009-2010 & Custom Act Anti Dumping Duty 2010-2011

Central Excise Act Excise Duty 1987--88

Nature of Statute Amount (Exculding Interest) Forum where pending (Rs.In Lacs)*

Gujarat General Sales Tax Act, 1969 5.67 Joint Commissioner of Sales Tax(Appeal), Vadodara.

Gujarat General Sales Tax, 1969 2.15 Assessing Authority-Bharuch

Gujarat General Sales Tax, 1969 1.65 Assessing Authority-Bharuch

Gujarat General Sales Tax, 1969 3.14 Dy. Commissioner of Commercial Tax (Appeal), Vadodara.

Central Sales Tax (Gujarat) Rules' 1970 Joint Commissioner of 10.67 Commercial Tax (Appeal), Vadodara

Andhara Pradesh General Sales Tax Act 8.62 Andhara Pradesh Tribunal

Andhara Pradesh General Sales Tax Act 10.02 Andhara Pradesh Tribunal

West Bengal Sales Tax Act 15.93 Joint Commissioner (Appeal) Kolkatta

Assam Value Added Tax Act 1.12 Joint Commissioner Guwahati

Income Tax Act Commissioner of Income Tax 143.06 appeal

Custom Act 230.44 Hon'ble Supreme Court of India

Central Excise Act 44.92 ** Hon'ble Supreme Court of India.-

* Amount shown as due is net of amounts already deposited on appeal

** Fixed deposit receipt lodged with Rajasthan Excise Department.

(x) The Company does not have accumulated losses as at the end of the financial year. There are no cash losses during the financial year under report and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company has not defaulted in repayment of dues to any financial institution or bank during the year.

(xii) In our opinion and according to the information and 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.

(xiii) 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 CARO, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanation given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the CARO, 2003 are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has given a counter guarantee of Rs.32.85 lacs in favour of Gujarat Industrial Development Corporation Limited (GIDC) in relation to the corporate guarantee provided by GIDC for availment of term loans by Bharuch Eco-Aqua Infrastructure Limited, the terms and conditions whereof are not, prima facie, prejudicial to the interest of the Company.

(xvi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the term loans taken by the Company have been applied for the purpose for which they were obtained.

(xvii) According to the information and explanations given to us and as per books and records examined by us, on the basis of an overall examination of the Balance Sheet of the Company, the funds raised by the Company on short-term basis, have not been applied for long-term purposes.

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

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

(xx) The Company has not raised any money by means of public issue during the year. Accordingly, the provisions of clause 4(xx) of the Order are not applicable to the Company.

(xxi) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, 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 B.D. GARGIEYA & CO. For S.S. KOTHARI MEHTA & CO.

Chartered Accountants Chartered Accountants

Firm Reg. No. 001072C Firm Reg. No. 000756N

Sd/- Sd/

(CA ASHOK MANGAL) (CA KRISHAN KANT TULSHAN)

Partner Partner

Membership No.71714 Membership No. 85033

Place: Gurgaon

Date: 29.05.2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of PI INDUSTRIES LIMITED, as at 31st March, 2011, and also the Profit and Loss account and 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 the 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 signifcant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors’ Report) Order, 2003 as amended by the Companies (Auditors’ Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specifed in paragraphs 4 and 5 of the said Order.

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

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

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

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

(iv) In our opinion, the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

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

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

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

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

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

Referred to in paragraph 3 of our report of even date, (i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) The Company has a phased programme of physical verifcation of its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. In accordance with this program, certain fixed assets were physically verifed by the management during the year and no material discrepancies were noticed on such verifcation as compared to the books of accounts.

(c) In our opinion and according to the information and explanations given to us, no substantial part of fixed assets has been disposed off by the Company during the year. However, on 11th April 2011 (subsequent to the balance sheet date), the Company has sold off its Polymer Business division as slump sale. (Refer Note No. 22 of Schedule XX)

(ii) (a) The inventory has been physically verifed by the management during the year. In our opinion, the frequency of verifcation is reasonable.

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

(c) In our opinion, the Company is maintaining proper records of inventory. As far as we could ascertain and according to the information and explanations given to us, no material discrepancies were noticed between the physical stock and the book records.

(iii) (a) As per the information & explanations given to us, the company has granted unsecured loan to one party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 75.00 lacs and the year-end balance of loan granted to such party was Rs. Nil.

(b) In our opinion and according to the information & explanation given to us, the rate of interest and other terms and conditions of such loan is not, prima facie, prejudicial to the interest of the company.

(c) The loan was repaid during the year. Accordingly, clauses 4(iii) (c ) & (d) of the Order are not applicable.

(d) The Company has taken unsecured loans from four parties covered in the register maintained under section 301 of the Companies Act 1956. In respect of the said loans, the maximum amount outstanding at any time during the year is Rs. 250.00 Lacs and the year-end balance is Rs 250.00 Lacs.

(e) In our opinion and according to the information & explanation given to us, the rate of interest and other terms and conditions of such loans, secured or unsecured, are not prima facie prejudicial to the interest of the company; and

(f) In respect of loan taken, repayment of the principal amount and interest are also regular as stipulated.

(iv) 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 purchase of inventories and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, 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 a major weakness in the aforesaid internal control systems.

(v) (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the registers maintained under section

301 of the Companies Act, 1956 and exceeding the value of fve lakh rupees in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public.

(vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government of India for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956, in respect of the manufacture of insecticides, formulations and technical grade insecticides and are of the opinion that, prima facie, the prescribed records and accounts have been made and maintained. However, we have not carried out a detailed examination of such records with a view to determining whether they are accurate or complete. The Company is not required to maintain any cost records under section 209(1)(d) of the Companies Act, 1956, in respect of any other product manufactured by the Company.

(ix) (a) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees’ State Insurance, Income tax, Sales tax, Service tax, Wealth tax, Customs duty, Excise duty, Cess and any other material statutory dues applicable to it.

(b) According to the records of the Company examined by us and the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees’ State Insurance, Income tax, Wealth tax, Sales tax, Service tax, Customs duty Excise duty and Cess were outstanding, as at 31st March, 2011 for a period of more than six months from the date they become payable.

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

Nature of Statute Nature of Period Amount Forum where pending Dues (F.Y.)(Rs. Lacs) *

Gujarat General Sales Tax 2001-02 5.67 Joint Commissioner of Sales Tax(Appeal), Vadodara. Sales Tax Act, 1969.

Gujarat General Sales Tax 1995-96 2.15 Assessing Authority- Bharuch Sales Tax, 1969

Gujarat General Sales Tax 1996-97 1.65 Assessing Authority- Bharuch Sales Tax, 1969

Gujarat General Sales Tax 2003-04 3.14 Dy. Commissioner of Commercial Tax (Appeal), Vadodara. Sales Tax, 1969.

Central Sales Tax Sales Tax 2003-04 10.67 Joint Commissioner of Commercial Tax (Appeal), Vadodara (Gujarat) Rules, 1970.

Andhara Pradesh Sales Tax 2001-02 8.62 Andhra Pradesh Tribunal General Sales Tax Act

Andhara Pradesh Sales Tax 2003-04 10.02 Andhra Pradesh Tribunal General Sales Tax Act

West Bengal Sales Tax 2003-04 15.93 Joint Commissioner (Appeal) Kolkatta Sales Tax Act

West Bengal Sales Tax 2003-04 2.24 West Bengal Tribunal Sales Tax Act

Assam Value VAT 2007-08 1.12 Joint Commissioner Guwahati Added Tax Act

Central Excise 1987-88 44.92 Excise Act Duty ** Hon’ble Supreme Court of India.

* Amount shown as due is net of amounts already deposited on appeal.

** Fixed deposit receipt lodged with Rajasthan Excise Department.



(x) The Company does not have accumulated losses as at the end of the financial year. There are no cash losses during the financial year under report and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company has not defaulted in repayment of dues to any financial institution or bank during the year.

(xii) In our opinion and according to the information and 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.

(xiii) 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 CARO, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanation given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the CARO, 2003 are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has given a counter guarantee of Rs.32.85 lacs in favour of Gujarat Industrial Development Corporation Limited (GIDC) in relation to the corporate guarantee provided by GIDC for availment of term loans by Bharuch Eco- Aqua Infrastructure Limited, the terms and conditions whereof are not, prima facie, prejudicial to the interest of the Company.

(xvi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the term loans taken by the Company have been applied for the purpose for which they were obtained.

(xvii) According to the information and explanations given to us and as per books and records examined by us, on the basis of an overall examination of the Balance Sheet of the Company, the funds raised by the Company on short-term basis, have not been applied for long-term purposes.

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

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

(xx) The Company has not raised any money by means of public issue during the year. Accordingly, the provisions of clause 4(xx) of the Order are not applicable to the Company.

(xxi) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, 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 B.D. gARgIEYA & CO. For S.S. KOTHARI mEHTA & CO.

Chartered Accountants Chartered Accountants

Firm Reg. No. 001072C Firm Reg. No. 000756N

Sd/- Sd/-

(CA ASHOK MANGAL) (CA NAVEEN AGGARWAL)

Partner Partner

Membership No.71714 Membership No. 094380

Place: Gurgaon Date: 14.4.2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of PI INDUSTRIES LIMITED, as at 31 st March, 2010, and also the Profit and Loss account and 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 on opinion on these Financial statements based on our audit.

2. We conducted our audit in accordance with the 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 principle used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis For our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) [Amendment) Order, 2004 issued by the Central Government of India in Farms of sub-section (4A) of section 227 of the Companies Act, 1956, and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure staternent on the matters specified in paragraphs 4 and 5 of the said Order.

A. Further to oar comments in the Annexure referred to above, we report that:

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

ii) In our opinion, proper books of accounts as required by low have been kept by the Company so for as appears from our examination of those books;

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

(iv] In our opinion, the Balance Sheet, Profit And Loss account and Cash Flow Statement deal with by this report, comply with the accounting standards referred to in sub-section [3C] of section 211 of the Companies Act, 1956;

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

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

(a) in the case of the BaIance Sheet, of the state of affairs of the Company as at 31 st March, 2010"

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

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

Referred to in paragraph 3 of our report of even date

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

(b) The Company has a phased programmed physical verification of its fixed assets which in our opinion, is reasonable having regard to the size of the Company and the nature of its fined assets. In accordance with this program, certain fixed assets were physically verified by the management during the year and no material discrepancies were noticed on such verification as compared to the books of accounts..

(c) In our opinion and according to the information and explanations given 1o us, no substantial part of fixed assets has been disposed off by the Company during the year.

(ii) (a) The inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonably.

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

(c) In our opinion, the Company is maintaining proper records of inventory. As far as we could ascertain and according la the Information and explanations given to us, no material discrepancies were noticed between the physical stock and the book records.

(iii) .(a) During the year, the Company has not granted any loans, secured or unsecured to companies, firm, or other parties covered in the register maintained under section 301 of the Companies Act, 1956. "Therefore, the provisions of clause 4 (iii) (b),(c) and 1d| of the Order, are not applicable to the Company. (b) The Company has taken loans from four parties covered in the register maintained under section 301 of the Companies Act, 1956. In respect of the said loans, the maximum amount outstanding at any rime during the year is Rs. 180 Lacs and the year-end balance is Rs 180 Lacs,

(c) In our opinion and according to the information & explanations given to us, the rate of interest and other terms and

conditions of such loans, secured or unsecured, are not prima facie prejudicial to the interest of the Company; and

(d) In respect of loan taken, repayment of the principal amount and interest are also regular as stipulated.

(iv) 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 purchase of inventories and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, 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 a major weakness In the aforesaid Internal control systems.

(v) (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion (hot the transactions that need to be entered into the register maintained under section 301 of the Companies Ad, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to US, the transactions made in pursuance of contracts or arrangements entered in the registers maintained under section 301 of the Companies Act, 1956 and exceeding the value of five lakh rupees in respect of any parly during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant lime.

[vi) In our opinion and according to the Information and explanations given 10 us, the Company has complied with the provisions of sections 58A and 58AA of the Companies Act, 1956 and the Companies [Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public.

(vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

[viii) We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules prescribed by the Central Government of India for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956,in respect of the manufacture of insecticides, formulations and technical grade insecticides and are of the opinion that, prima facie, the prescribed records and accounts have been made and maintained. However, we have not carried out o detailed examination of such records with a view to determining whether they are accurate Or complete. The Company is not required to maintain any cost records under section 209 (1)(d) of the Companies Act, 1956, in respect of any other product manufactured by the Company.

(ix) (a) According lathe records of the Company examined by us and the information and explanations given to us, in our opinion, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident fund, Investor Education and Protection Fund, Employees State Insurance, Income lax, Sales tax. Service tax, Wealth tax, Customs duty, Excise duty, Cess and other materia I statutory does applicable to it.

(b) According to the records of the Company examined by us and (he information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance Fund, Income tax, Wealth tax, Sales taxr Service tax, Customs duty, Excise duty. Cess and other material statutory dues were outstanding, as at 31 st March, 2010 for a period of more than six months from the date they become payable-

(c) According to the information and explanations given to us, there a re no dues of sales tax, income tax, customs duty, service tax, wealth tax, excise duty and cess which have not been deposited on account of any dispute, other than the following:-

Nature of Statue Nature of Dues Period(F.Y.) Amount Forum where pending (Rs. Lacs)*

Gujarat General Sales Tax 2001-02 5.67 Joint Commissioner Sales Tax Act, 1969. of Sales Tax(Appeal) Vadodara.

Gujarat General Sales Tax 2OO3-04 3.14 Dy.Cominissioriai of sales Tax, 1969. Commercial Tax (Appeal}, Vadodara.

Central sales Tax Sales Tax 2003-04 10.67 Joint Commissioner [Gujarat) Rules, 1970. of Commercial Tax (appeal) Vododara

Andhara Pradesh General Sales Tax 2001-02 8.62 Andhara Pradesh Sales Tax Act Tribunal

Andhara Pradesh Sales Tax 2OO3-04 10.02 Andhara Pradesh

General Sales Tax Act Tribunal

West Bengal Sales Tax Act Sales Tax 2003-04 15.93 Joint Commissioner {Appeal} Kolkatta

West Bengal Sales Tax Act Sales Tax 2003-04 2.24 West Bengal Tribunal

Central Excise Act Excise Duty 1987-88 44.92 " Honble- Supreme Court of India.

Amount shown as due is net of amounts already deposited on appeal. " Fixed deposit receipt lodged with Rajasthan excise Department

(x] The Company does not have accumulated losses as at the end of the financial year. There are no cash losses during the financial year under report and in the immediately preceding financial year.

(xi) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company has not defaulted ill repayment of dues to any financial institution or bank during the year.

(xii) In our opinion and according to the information and 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.

(xiii] 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 CARO, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clouse 4(xiv) of the CARO, 2003 are not applicable to the. Company.

(xv) According to the information and explanations given to us, the Com party has given a counter guarantee of Rs .32. 85 lacs in Favour of Gujarat Industrial Development Corporation Limited (GlDC) in relation to the corporate guarantee provided by GIDC for availment of term loans by Bharuch Eco-Aqua Infrastructure Limited, the terms and conditions where of are not, prima Facia, prejudicial to the interest of the Company,

(xvij According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the term loans taken by the Company have been applied for the purpose for which they were obtained.

(xvii) According to the information and explanations given to us and as per the books and records examined by usr on on overall examination of the Balance Sheet of the Company, the funds raised by the Company on short-term basis have not been applied For long-term purposes.

(xviii} During the year, the Company has not mode any preferential allotment at shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1 956.

[xix] During the period covered by our audit report, the Company has issued unsecured Zero Coupon Optionally Convertible Debenture an which no security or charges is required to be created.

[xx] Thie company has not raised any money by means of public issue during the year However, the Company has raised Rs. 2060 Iacs by allotment of preferential issue of 0.01% Hon Cumulative Compulsory Convertible Preference Shores & Rs. 2940 Iacs by issue of Optionally Convertible Debentures, We have verified the end use of money raised as disclosed in the notes to the financial statements. Refer Note 20 at the Schedule XXI-B .

[xxi] During the course of our examination of the books and records of the Company carried out in accordance with the

generally accepted auditing practices in India, we have neither come accross 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 managemenl.

For B.D. GARGIEYA &, CO. For S.S. KOTHARI MEHTA & CO, Chartered Accountants Chartered Accountants Registration No. 001072C Registration No. 000756N

Sd/- Sd/- (CA ASHOKMANGAL) (CAJ. KRISHNAN) Partner partner Membership No.71714 Membership No. 84551

Place: Mumbai Date : 17.05.2010

Find IFSC