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Auditor Report of Pondy Oxides & Chemicals Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of PONDY OXIDES AND CHEMICALS LIMITED ("the company"), which comprise the Balance Sheet as at 31st March, 2015, 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:

The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these financial statements that give a true and fair view of the financial position, 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 disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose expressing an opinion on whether the Company has in place an adequate internal financial control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion:

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

Report on other Legal and Regulatory Requirements:

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

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

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

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

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

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

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

(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) Rule, 2014, in our opinion and to the best of our information and according to the explanations given to us :

i. The Company does not have any pending litigation which would impact its financial position.

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

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

Annexure to the Independent Auditor's Report

The annexure referred to in Para 1 under the heading of "Report on other Legal and Regulatory Requirements" of our report to the members of the Company for the year ended 31st March, 2015.

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

(b) The assets have been physically verified by the management at the end of financial year, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

2) (a) The inventories 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 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 the nature of its business.

(c) The Company has maintained proper records of inventories. As explained to us, there were no materials discrepancies noticed on physical verification of inventories as compared to the book records.

3) (a) During the year, 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.

(b) In view of our comment in paragraph (a) above, Clause III of the aforesaid order are not applicable to the company.

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 purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5) The company has accepted Deposits from Directors and Inter Corporate. In our opinion and according to information and explanations given to us, all the directives issued by the Reserve Bank of India and provisions of Section 73 to 76 or any other relevant provisions of the Companies Act 2013, and the rules framed there under where applicable were complied with. Further, we are informed by the management that no order has been passed by the Company Law Board or National Company Law Tribunal or RBI or any court or any Other Tribunal on the Company.

6) We have broadly reviewed the cost records maintained by the Company specified by the Central Government under sub Section (1) of section 148 of the Companies Act, 2013 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 cost records with a view to determine whether they are accurate or complete.

7) (a) According to the information and explanation given to us and on the basis of our examination of the records of the company, amount deducted/accrued in the books of accounts in respect of undisputed statutory dues including Provident Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Value Added Tax, Excise Duty, Cess and other material statutory dues applicable have been regularly deposited with the appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs Duty and Excise Duty, Value Added Tax, Cess and other material statutory dues were in arrears as at 31st March, 2015 for a period of more than six months from the date they became payable.

(c) According to the information and explanation given to us, the dues of Income Tax, Sales Tax, Custom Duty, Wealth Tax, Service Tax, Excise Duty and Cess which have not been deposited on account of dispute are as follows:

S. No Name of the Statute Nature of Dues Amount Period to Rs. in Lakhs which the amount relates

1 The Income Tax Act, Direct Tax 7.01 AY 2009-2010 1961

Name of the Statue Forum where dispute is pending

The Income Tax Act, Commissioner of Income 1961 Tax (Appeals)

(d) According to the information and explanation given to us the amounts which were required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund within the time.

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

9) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. The Company does not have any borrowings by way of debentures.

10) According to the information & explanations given to us, the Company has not given any guarantee for loans taken by others from banks and financial institutions.

11) The company has raised new term loan during the year. The term loans outstanding at the beginning of the year and those raised during the year have been applied for the purpose for which they were raised.

12) In our Opinion and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the year.

for JEERAVLA & Co.,

Chartered Accountants FRNo.001323S

SOHAN C J PARMAR

Place : Chennai Proprietor

Date : 27th May, 2015. Membership No.: 022321


Mar 31, 2014

We have audited the accompanying financial statements of Pondy Oxides and Chemicals Limited ("the Company"), which comprise the Balance sheet as at 31.03.2014, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements:

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

Auditor''s Responsibility:

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

obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

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

Opinion:

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

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

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.

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 matter 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 is 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 the agreement with the books of accounts.

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

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

(f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURE TO AUDITORS'' REPORT DATED May 30, 2014

The annexure referred to in the Auditors'' Report to the Members of Pondy Oxides and Chemicals Limited ("the Company") for the year ended 31st March 2014

1) In respect of its Fixed Assets:

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

(b) The assets have been physically verified by the management at the end of financial year, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us, no substantial part of fixed assets has been disposed off during the year and the going concern status of the Company is not affected.

2) In respect of its Inventories:

(a) The inventories 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 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 the nature of its business.

(c) The Company has maintained proper records of inventories. As explained to us, there were no materials discrepancies noticed on physical verification of inventories as compared to the book records.

3) In respect of the loans, secured or unsecured , granted or taken by the company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

(a) The Company has given loans to its Subsidiary. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs 3.93 Cr and the year-end balance is Rs 1.61 Cr.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of the loans given by the company, are not prima facie prejudicial to the interest of the company.

(c) The principal amount is repayable on demand.

(d) In respect of the said loans and interest thereon, there are no overdue amounts.

(e) The Company has taken loans during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. The maximum outstanding at any time during the year was Rs 9.56 Cr and the year-end balance is Rs 3.60 Cr..

(f) In our opinion, the rate of interest and other terms and conditions of the said loan are not prima facie prejudicial to the interest of the company.

(g) The interest payments, wherever applicable, have been regularly paid by the company.

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

5) In respect of the contract or arrangement referred to in Section 301 of the Companies Act, 1956:

(a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements entered in the Register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rs.5,00,000 in respect of each party during the year have been made at prices which appear reasonable as per information available with the Company.

6) The company has accepted Fixed Deposits from Directors & their relatives/friends. In our opinion and according to information and explanations given to us, all the directives issued by the Reserve Bank Of India and provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act 1956, and rules framed there under where applicable were complied with. Further, we are informed by the management that no order has been passed by the Companies Law Board or National Company Law Tribunal or RBI or any Other Tribunal on the Company.

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

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

9) In respect of Statutory dues:

(a) Undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues applicable have generally been regularly deposited with the appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs Duty and Excise Duty and Cess were outstanding as at 31st March, 2014 for a period of more than six months from the date they became payable.

(c) The disputed statutory dues aggregating Rs 7.01 Lakhs that have not been deposited on account of dispute pending before appropriate authorities are as under:

Name of the Nature of Amount Period to which Statute Dues Rs. in Lakhs the amount relates

The Income Direct Tax 7.01 AY 2009-2010 Tax Act, 1961

Name of the Statute Forum where dispute is pending

The Income Statute Commissioner of Income Tax (Appeals)

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) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. The Company does not have any borrowings by way of debentures.

12) In our opinion and according to the information and explanations given to us and based on the information available, 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. Hence paragraph 4(xii) of the CARO, 2003 is not applicable to this Company.

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, and as per the information and explanations given to us, the Company has not dealt or traded in shares, securities, debentures and other investments. In respect of the Long term investments made in the equity shares of another company, proper records have been maintained and timely entries have been made therein and the shares have been held by the Company in its own name.

15) According to the information & explanations given to us, the Company has given guarantee for loans taken from banks by its subsidiary; the terms and conditions whereof in our opinion are not prima facie prejudicial to the interest of the Company.

16) The company has raised new term loan during the year. The term loans outstanding at the beginning of the year and those raised during the year have been applied for the purpose for which they were raised.

17) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that no funds raised on short term basis that have been used for long term investments.

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

19) The Company has not issued any debentures during the year

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

21) In our Opinion and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the year.

For JEERAVLA & CO., Chartered Accountants (Firm Registration No.001323S)

SOHAN C J PARMAR Chennai Proprietor Date: May 28, 2014 Membership No.: 022321


Mar 31, 2013

Report on the Financial Statements:

We have audited the accompanying financial statements of Pondy Oxides and Chemicals Limited ("the Company"), which comprise the Balance sheet as at 31.03.2013, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements:

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

Auditor''s Responsibility:

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

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

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

Opinion:

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

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

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.

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 matter 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 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 the agreement with the books of accounts.

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

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

(f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURE TO AUDITORS'' REPORT DATED May 30, 2013

The annexure referred to in the Auditors'' Report to the Members of Pondy Oxides and Chemicals Limited ("the Company") for the year ended 31st March 2013

1) In respect of its Fixed Assets:

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

(b) The assets have been physically verified by the management at the end of financial year, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us, no substantial part of fixed assets has been disposed off during the year and the going concern status of the Company is not affected.

2) In respect of its Inventories:

(a) The inventories 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 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 the nature of its business.

(c) The Company has maintained proper records of inventories. As explained to us, there were no materials discrepancies noticed on physical verification of inventories as compared to the book records.

3) In respect of the loans, secured or unsecured , granted or taken by the company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

(a) The Company has given loans to its Subsidiary. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs 4.13 Cr and the year-end balance is Rs.2.59 Cr.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of the loans given by the company, are not prima facie prejudicial to the interest of the company.

(c) The principal amount is repayable on demand.

(d) In respect of the said loans and interest thereon, there are no overdue amounts.

(e) The Company has taken loans during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. The year-end balance is Rs 7.63 Cr (including interest on loan of Rs.0.95 Cr) and the maximum outstanding at any time during the year was Rs 11.15 Cr.

(f) In our opinion, the rate of interest and other terms and conditions of the said loan are not prima facie prejudicial to the interest of the company.

(g) The interest payments, wherever applicable, have been regularly paid by the company.

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

5) In respect of the contract or arrangement referred to in Section 301 of the Companies Act, 1956:

(a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements entered in the Register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rs.5,00,000 in respect of each party during the year have been made at prices which appear reasonable as per information available with the Company.

6) The company has accepted Fixed Deposits from Directors & their relatives/friends. In our opinion and according to information and explanations given to us, all the directives issued by the Reserve Bank Of India and provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act 1956, and rules framed there under where applicable were complied with. Further, we are informed by the management that no order has been passed by the Companies Law Board or National Company Law Tribunal or RBI or any Other Tribunal on the Company.

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

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

9) In respect of Statutory dues:

(a) Undisputed statutory dues including Provident Fund, Investor Education and Protection Fund (IEPF), Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues applicable have generally been regularly deposited with the appropriate authorities.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs Duty and Excise Duty and Cess were outstanding as at 31st March, 2013 for a period of more than six months from the date they became payable.

(c) The disputed statutory dues aggregating Rs 7.01 Lakhs that have not been deposited on account of dispute pending before appropriate authorities are as under:

S. No Name of the Statute Nature of Dues Amount in Rs Lakhs

1 The Income Tax Act, Direct Tax 7.01 1961

Name Period to Forum where which the dispute is pending amount relates

The Income Tax Act, AY 2009-2010 Commissioner of Income Tax (Appeals)

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 preceeding financial year.

11) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. The Company does not have any borrowings by way of debentures.

12) In our opinion and according to the information and explanations given to us and based on the information available, 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. Hence paragraph 4(xii) of the CARO, 2003 is not applicable to this Company.

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, and as per the information and explanations given to us, the Company has not dealt or traded in shares, securities, debentures and other investments. In respect of the Long term investments made in the equity shares of another company, proper records have been maintained and timely entries have been made therein and the shares have been held by the Company in its own name.

15) According to the information & explanations given to us, the Company has given guarantee for loans taken from banks by its subsidiary; the terms and conditions whereof in our opinion are not prima facie prejudicial to the interest of the Company.

16) The company has raised new term loan during the year. The term loans outstanding at the beginning of the year and those raised during the year have been applied for the purpose for which they were raised.

17) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that no funds raised on short term basis that have been used for long term investments.

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

19) The Company has not issued any debentures during the year

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

21) In our Opinion and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the year.

For JEERAVLA & CO

Chartered Accountants

(Firm Registration No.001323S)

SOHAN C J PARMAR

Chennai Proprietor

Date: May 30, 2013 Membership No.: 22321


Mar 31, 2012

1. We have audited the attached Balance Sheet of Pondy Oxides and Chemicals Limited as at 31st March 2012, the relative Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date and signed by us under reference to this report. 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 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 matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 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, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(iv) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply in all material respects with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India 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, and taken on record by the Board of Directors, we report that none of the Director is prima facie 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;

(vi) In our opinion and to the best of our information and according to the explanations given to us, ' the aforesaid financial statements read with the statement on significant accounting policies and notes on financial statements 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 the affairs of the Company as at March 31, 2012;

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.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR AUDIT REPORT OF EVEN DATE TO THE MEMBERS OF PONDY OXIDES AND CHEMICALS LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH, 2012.

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

(ii) The fixed assets are being physically verified under a phased programme of verification by the management, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(iii) According to the information and explanations given to us, no substantial part of fixed assets has been disposed off during the year.

2) (i) The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(ii) 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 the nature of its business.

(iii) The Company has maintained proper records of inventory. As explained to us, there were no materials discrepancies noticed on physical verification of inventories as compared to the book records.

3) (a) In respect of the loans, secured or unsecured, granted by the company to companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956, according to the information and explanations given to us:

(i) The Company has granted unsecured loans to its subsidiary. The maximum amount involved during the year was Rs. 2.11 Cr and the year-end balance of the loan granted to such Company is Rs.0.90 Cr.

(ii) The rate of interest and other terms and conditions of such loans are, in our opinion, prima facie not prejudicial to the interests of the Company.

(iii) The principal amount is repayable on demand.

(iv) The loan and the interest due thereon are not due for repayment as per the terms of the agreement.

(v) There are no overdue amounts outstanding as at the Balance Sheet date.

(b) The Company has taken the unsecured loans from 21 parties covered in the register maintained under Section 301 of the Companies Act, 1956, the maximum amount outstanding during the year was Rs.12.71 Cr and the year- end balance of loan taken from such parties was Rs. 7.34 Cr.

(i) In our opinion, the rate of interest and other terms and conditions of the said loans are not prima facie, prejudicial to the interest of the Company.

(ii) The interest payments, wherever applicable, have been regularly paid by the Company.

4) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory 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, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

5) In respect of the contract or arrangement referred to in Section 301 of the Companies Act, 1956:

(i) In cur opinion and according to the information and explanations given to us, we are of the opinion that the particulars of the contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(ii) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts and arrangements entered in the register maintained under sec 301 of the Companies Act 1956 exceeding the value of Rs.5,00,000 in respect of each party during the year, have been made at prices, which are prima facie reasonable, having regard to prevailing market prices at the relevant time.

6) In our opinion and according to information and explanations given to us, all the directives issued by the Reserve Bank of India and provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act 1956, and rules framed there under where applicable were complied with. Further, we are informed by the management 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 for non-compliance with the provisions of Section 58Aand 58AAofthe Companies Act, 1956.

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

8) On the basis of the records produced, we are of the opinion that prima facie, the cost records and accounts prescribed by the Government of India under Section 209(1) (d) of the Companies Act, 1956 have been made and maintained by the Company.

9) (i) According to the information and explanation given to us and records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities.

(ii) According to the information and explanations given to us, there were no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues outstanding as at 31st March, 2012 for a period of more than six months from the date they became payable.

(iii) According to the information and explanations given to us and the records of the Company examined by us, the particulars of Income Tax as at 31st March 2012 which have not been deposited on account of dispute is as under:

S.No Name of the Statute Nature of Amount Period to Forum where dispute is pending disputed Rs. in which the dues Lakhs amount relates

1 The Income Tax Act, Direct Tax 7.01 AY 2009- 2010 Commissioner of Income Tax(Appeals) 1961

10) The company has no accumulated losses as at March 31, 2012 and has not incurred cash losses during the financial year covered by our audit or in the immediately preceding financial year.

11) According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institution and bank. The Company does not have any borrowings by way of debentures.

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

13) The provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund/societies are not applicable to the Company.

14) According to the information furnished to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the requirements of clause (xiv) of paragraph 4 of the Order are not applicable.

15) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken from banks by its subsidiary from banks and financial institutions are not prima-facie prejudicial to the interest of the Company.

16) In our opinion and according to the information and explanations given to us, the term loans availed by the Company were, prima facie, applied by the Company during the year for which the loans were obtained.

17) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company funds raised on short-term basis have prima facie, not been used for long term investments or other investments during the year under report.

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

19) The Company has not issued any debentures during the year. Hence the clause (xix) of paragraph 4 of the Order is not applicable.

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

21) 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, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by management.

For Jeeravla & Co.,

Chartered Accountants Firm Reg No. 001323S

Sohan C.J.Parmar

Place : Chennai Proprietor

Date : 27th July 2012 Membership No:22321


Mar 31, 2011

1. We have audited the attached Balance Sheet of Pondy Oxides and Chemicals Limited as at 31st March 2011, the relative Profit and Loss account and the Cash Flow Statement for the year ended on that date and signed by us under reference to this report. 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 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 matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 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 in all material respects with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India 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, and taken on record by the Board of Directors, we report that none of the Directors is prima facie 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;

[vi] In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements read with the statement on significant accounting policies and notes to the 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 the affairs of the Company as at March 31,2011;

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.

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR AUDIT REPORT OF EVEN DATE TO THE MEMBERS OF PONDY OXIDES & CHEMICALS LIMITED ON THE ACCOUNTS AS AT AND FOR THE YEAR ENDED 31st MARCH, 2011.

1. In respect of its Fixed Assets:

[i] The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

[ii] The assets have been physically verified by the management at the end of financial year, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

[iii] According to the information and explanations given to us, no substantial part of fixed assets has been disposed off during the year.

2. In respect of its Inventories:

[i] The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

[ii] 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 the nature of its business.

[iii] 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 the book records.

3. In respect of the loans, secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

[i] (a) The Company has not granted any Loans, secured or unsecured, to companies, firms or other parties covered under the register maintained under section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (iii) (a) to (d) of the Companies(Auditor Report) Order are not applicable.

[ii] (e) The Company has taken loans during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956 amounting to Rs. 15.27 crores, the year-end balance was Rs.3.98 crores and maximum balance due was Rs.12.84crores.

(f) In our opinion, the rate of interest and other terms and conditions of the said loans are not prima facie prejudicial to the interest of the company.

(g) The Interest payments, wherever applicable, have been regularly paid by the company.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods& services. Further, on the basis of our examination of the books and records of the Company, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control procedure.

5. In respect of the contract or arrangement referred to in Section 301 of the Companies Act, 1956:

[i] In our opinion and according to the information and explanations given to us, we are of the opinion that the particulars of the contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

[ii] In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rs.5,00,000/- in respect of any party during the year, have been made at prices, which are prima facie reasonable, having regard to prevailing market prices at the relevant time.

6. In our opinion and according to information and explanations given to us, the company has complied with the provisions of Section 58Aand 58AAor any other relevant provisions of the Companies Act 1956, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to deposits accepted from the public. According to the information and explanation given to us, no order has been passed by the Company Law Board or the 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 its size and nature of its business.

8. According to information and explanations given to us, the Central Government has not prescribed forthe maintenance of cost records under section 209[1][d] of the Companies Act, 1956, in respect of the products of the company.

9. In respect of Statutory dues:

[i] According to the information and explanation given to us and records of the Company examined by us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, 'Excise duty, Cess and other material statutory dues as may be applicable have been generally regularly deposited with the appropriate authorities.

[ii] According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31s' March, 2011 for a period of more than six months from the date they became payable.

[iii] According to the information and explanations given to us, there are no disputed dues which have remained unpaid as on 31st March, 2011 in respect of Income tax, Wealth tax, Sales tax, Customs Duty, Excise Duty and Cess.

10. The company has no accumulated losses as at 31st March 2011 and has not incurred cash losses during the financial year covered by our audit or in the immediately preceeding financial year.

11. In our opinion and according to the information and explanations given to us. the Company has not defaulted in repayment of dues to financial institutions and banks. The Company does not have any borrowings by way of debentures.

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

13. 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.

14. The Company is not dealing in or trading in Share, Securities, Debentures and Other Investments. Therefore, the provisions of clause 4[xiv] of Companies[Auditor's Report] Order 2003 are not applicable.

15. In our opinion and according to the information & explanations given to us, the terms and conditions of the gurantees given by the company for loan taken by others from banks and financial institutions are not prima-facie prejudicial to the interest of the Company.

16. In our opinion and according to the information and explanations given to us, the term loans availed by the company were, prima facie, applied by the Company during the year for the purpose for which the loans were obtained.

17. According to the information and explanations given to us the cash flow statement examined by us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term Investments.

18. According to the information and explanations given to us 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. The Company has not issued any debentures during the year

20. The Company has not raised any money by public issue of securities during the year and therefore, the verification of the end use of the money does not arise.

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

For Jeeravla & Co.,

Chartered Accountants

Firm Registration No : 001323S

Sohan C.J.Parmar

Place : Chennai Proprietor

Date : 28.07.2011 Membership No. 022321


Mar 31, 2010

1. We have audited the attached Balance Sheet of Pondy Oxides and Chemicals Limited as at 31st March 2010, the relative Profit and Loss account and the Cash Flow Statement for the year ended on that date and signed by us under reference to this report. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies [Auditors Report] Order, 2003 issued by the Central Government of India in terms of sub-section [4A] of Section 227 of the Companies Act, 1956 we enclose in the Annexure a statement on matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 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 in all material respects with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India 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, and taken on record by the Board of Directors, we report that none of the Director is prima facie 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;

[vi] In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements read with the statement on significant accounting policies and notes to the 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 the affairs of the Company as at March 31,2010;

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

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

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR AUDIT REPORT OF EVEN DATE TO THE MEMBERS OF PONDY OXIDES & CHEMICALS LIMITED ON THE ACCOUNTS AS AT AND FOR THE YEAR ENDED 31st MARCH, 2010.

1. In respect of its Fixed Assets:

[i] The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

[ii] The assets have been physically verified by the management at the end of financial year, which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

[iii] According to the information and explanations given to us, no substantial part of fixed assets has been disposed off during the year.

2. In respect of its Inventories:

[i] The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

[ii] 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 the nature of its business.

[iii] 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 the book records..

3. In respect of the loans, secured or unsecured , granted or taken by the company to/from companies, firms or other-parties covered in the Register maintained under Section 301 of the Companies Act, 1956:

fi] The Company has not given Loans during the year to parties covered in the Register under section 301 of the companies Act. The transaction is covered in the Register maintained under Section 301 of the Companies Act, 1956.

[ii] The Company has taken loans during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956 to Rs.2.06 Cr of which Rs.1.64 Cr returned by them. Highest amount of outstanding is Rs.4.43 Cr and the terms and conditions are prima facie not prejudicial to the interest of the company and are regular in repayment as per stipulation.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods& services. Further, on the basis of our examination of the books and records of the Company, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control procedure.

5. In respect of the contract or arrangement referred to in Section 301 of the Companies Act, 1956:

[i] In our Opinion and according to the information and explanations given to us, we are of the opinion that the particulars of the contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

[ii] In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rs.5,00,000 in respect of any party during the year, have been made at prices, which are prima facie reasonable, having regard to prevailing market prices at the relevant time.

6. The company has accepted Fixed Deposits from Directors & their relatives and friends only. In our opinion and according to information and explanations given to us, all the directives issued by the Reserve Bank of India and provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act 1956, and rules framed there under where applicable were complied with. Further, we are informed by the management that no order has been passed by the Company Law Board or National Company Law Tribunal or RBI or any other Tribunal on the Company.

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

8. According to information and explanations given to us, the Central Government has not prescribed for the maintenance of cost records under section 209[1][d] of the Companies Act, 1956, in respect of the products of the company.

9. In respect of Statutory dues:

[i] Undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues applicable have generally been regularly deposited with the appropriate authorities.

[ii] According to the information and explanations given to us, no undisputed amounts payable in respect of Income tax, Wealth tax, Service tax, Sales tax, Customs duty and Excise duty and Cess were outstanding as at 31st March, 2010 for a period of more than six months from the date they became payable.

[iii] According to the information and explanations given to us, there are no dues of Income tax, Wealth tax, Sales tax, Customs duty and Excise duty and Cess, which have not been deposited on account of any dispute.

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 preceeding financial year.

11. According to the information and explanations given to us by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. The Company does not have any borrowings by way of debentures.

12. In our opinion and according to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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 Share, Securities, Debentures and Other Investments. Accordingly, the provision of clause[xiv] of Companies[Auditors Report] Order 2003 are not applicable to the Company.

15. According to the information & explanations given to us, the Company has given guarantee for loans taken from banks by its subsidiary and associated company, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the in^rest of the Company.

16. In our opinion and according to the information and explanations given to us, the term loans availed by the company were, prima facie, applied by the Company during the year for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, funds raised on short term basis have prima facie, not been used for Long term Investments.

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

19. The Company has not issued any debentures during the year

20. The Company has not raised any money by public issue during the year.

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

For Jeeravla & CO.

Chartered Accountants Firm Registration No: 001323S

Sohan CJ.Parmar

Place : Chennai Proprietor

Date : 12.07.2010 Membership No. 022321


Mar 31, 2000

We have audited the attached Balance Sheet of Pondy Oxides and Chemicals Limited as at 31st March 2000, and the Profit and Loss Account for the year ended on that date annexed thereto and report that:

1. As required by the Manufacturing and Other Companies (Auditors Report) Order, 1988 issued by the Company Law Board in terms of Section 227 (4A) of the Companies Act, 1956, we give below a statement on the matters specified in paragraphs 4 and 5 of the said order.

i. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. Most of the assets have been physically verified by the management during the year and there is a regular programme of verification which in our opinion is reasonable having regard to the size of the company and nature of its assets. No material discrepancies were noticed on verification.

ii. None of the fixed assets has been revalued during the year.

iii. The stocks of finished goods, stores, spare parts and raw materials have been physically verified during the yearbythe management. Inour opinion, the frequency of verification is reasonable.

iv. The procedures for physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

v No material discrepancies were noticed between the physical verification of stock and the book records.

vi. On the basis of our examination of stock records, we are of the opinion that the valuation of stock is fair and proper, and in accordance with the normally accepted accounting principles, and is on the same basis as in the preceding year.

vii. According to the information and explanations given to us, the company has taken loans, unsecured from parties listed in the Register maintained under section 301 of the Companies Act, 1956 and the rate of interest and terms and conditions on which loans have been taken are not prejudicial to the interest of the company and the company has not taken any loan secured, unsecured from the company under the same management as defined under sub section (1 -B) of section 370 of the Companies Act, 1956.

viii.The company has granted loans, unsecured to parties listed in the Register maintained under section 301 and to the companies under the same management as defined under sub sect ion (1 - B) of section 370 of the Companies Act, 1956 wherein the rate of interest and terms and conditions on which loans have been granted are not prejudicial to the interest of the company.

ix. The parties to whom loans and advances in the nature of loans have been given by the company are repaying the principal amounts and interest wherever applicable as stipulated.

x In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchases of stores, raw materials including components, plant and machinery, equipment and other assets and for the sale of goods.

xi. In our opinion and according to the information and explanations given to us, the transactions of purchases of goods and materials and sale of goods, materials and services, made in pursuance of contracts or arrangements entered in the Register under section 301 of the Companies Act, 1956 and aggregating during the year Rs. 50,000/- or more in respect of each party have been made at prices which are reasonable having regard to prevailing market prices of such goods, materials or services or the prices at which transactions of similar goods, materials or services have been made with other parties.

xii. According to information given to us the company has no unserviceable or damaged goods, raw materials and finished goods.

xiii. in our opinion and according to the information and explanations given to us, the company has not complied with the provisions of section 58A of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the unsecured loans accepted by the Company.

xiv. In our opinion, reasonable records have been maintained by the company for the sale and disposal of its by-product arising during manufacturing process and the company does not generate any scrap.

xv. In our opinion, the company has an Internal Audit system commensurate with the size and nature of its business.

xvi. The maintenance of cost records has not been prescribed by the Central Government under section 209(1)(d)of the Companies Act, 1956 in respect of the companys products.

xvii. According to the records of the company Provident Fund and Employees State Insurance dues have been regularly deposited during the year with the appropriate authorities.

xviii. According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Exicse Duty were outstanding as at 31 st March 2000 for a period of more than six months from the date they became payable.

xix. According to information and explanations given to us, no personal expenses of employees or directors have been charged to revenue account, other than those payable under contractual obligations or in accordance with generally accepted business practice.

xx The company is not a sick industrial company within the meaning of clause (O) of sub section (i)of section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985.

2. Further to the foregoing 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 such books.

c) The Balance Sheet and Profit and Loss Account referred to in this report are in agreement with the books of account.

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

e) In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet and Profit and Loss Account read together with the schedules thereto and notes thereon give the information required by Companies Act, 1956 in the manner so required and give a true and fair view:

(i) In so far as it relates to the Balance Sheet, of the state of affairs of the company as at 31 st March 2000 and

(ii) In so far as it relates to the Profit and Loss Account of the Profit of the company for the year ended on that date.

For JEERAVLA & Co.,

Chartered Accountants

Place : Chennai SOHAN C.JEERAVLA PARMAR

Date : 12.07.2000 Proprietor.



 
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