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Auditor Report of Pudumjee Pulp & Paper Mills Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of Pudumjee Pulp & Paper Mills Ltd ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation 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 of 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 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 Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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 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 paragraph 3 and 4 of the Order.

2 As required by Section 143 (3) of the Act,

(a) We have sought and obtained all the information and explanation 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 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) The Company has adequate internal financial control and in our opinion the same is operating effectively.

(g) 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 pending litigations in its financial statements, which may impact its financial position [Refer Note 25.14 (a) (ii)];

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

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

ANNEXURE TO INDEPENDENT AUDITORS' REPORT Referred to in Paragraph 1 under the heading of "report on other legal and regulatory requirements" of our report of even date of the financial statements for the year ended 31st March 2015.

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

b) As explained to us, the fixed assets have been physically verified by the Management at the end of the year. It has been reported to us that, no material discrepancies have been noticed on such verification;

ii a) It is reported that, the inventories have been physically verified by the management at the end of the year;

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 and as explained to us there were no material discrepancies noticed on physical verification of inventory as compared to the book records;

d) The Company has granted unsecured loans covered in the register maintained under Section 189 of the Companies Act, 2013, wherein the balance of principal amount and interest recovered as at the year end is Rs.6983.17 lacs.

e) The receipt of the principal amount and interest thereon is also regular;

f) There are no overdue amounts in respect of loans given by the Company.

iii In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventories, fixed assets and also for the sale of goods and services. We have not observed any continuing failure to correct major weaknesses in the internal control system;

iv The Company has not accepted any deposit during the year and has repaid those deposits which were due and claimed. The Company has complied with the directives issued by the Reserve Bank of India and provisions of Section 73 to 76 and other relevant provisions of the Companies Act, 2013 and the rules framed thereunder;

v We have broadly reviewed the records maintained by the Company pursuant to the order made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However no detailed examination of such accounts and records have been carried out by us;

vi a) According to the records of the Company, undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess and other outstanding statutory dues have been regularly deposited during the year with the appropriate authorities.

There are no undisputed statutory dues referred above as on 31st March 2015 outstanding for a period of more than six months from the date they became payable; b) The disputed Statutory dues aggregating Rs.156.26 lacs that have not been deposited on account of disputes and matters pending before appropriate authorities are as under :

S. No Nature of the dues Forum where the dispute is pending Amount (Rs. in lacs)

1 Excise Duty High Court, Mumbai. (Dept's appeal) 20.96

2 Excise Duty CESTAT (Dept's appeal) 60.05

3 Excise Duty CESTAT (Dept's appeal) 0.51

4. Excise Duty CESTAT Dy. Commissioner (Central Excise) 5.63

5. Customs CESTAT 68.32

6. Service Tax CESTAT (Service Tax) (Dy. Commissoner) 0.79

vii The Company has transferred Rs.1.90 lacs during the year to investor education and protection fund in accordance with the provisions of section 125 the companies act, 2013 and rules made there under;

viii The Company has no accumulated losses and the Company has not incurred cash Loss during the year under report and in the immediately preceding financial year also;

ix According to the information and explanations given to us, the Company has not made any default in repayment of dues to financial institutions or banks. The Company does not have any outstanding debentures;

x The Company has given a corporate guarantee for loan taken by a Firm (in which it is a Partner) from Banks [refer Note 25.14(ii)] and according to the information and explanations given to us, the terms and conditions of such guarantee are not prejudicial to the interest of the Company;

xi According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained;

xii To the best of our knowledge and belief, and according to the information and explanations given to us by the management, no fraud on or by the company has been noticed or reported during the course of our audit.

For KHARE & COMPANY

Chartered Accountants (FRN 105100W)

(Y.P. SHUKLA)

Place of Signature : Mumbai, (Proprietor)

Dated : 30th May, 2015. (Membership No. 16203)


Mar 31, 2014

We have audited the accompanying financial statements of Pudumjee Pulp and Paper Mills Ltd. ("the Company"), which comprise the Balance Sheet as at March 31, 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 Section 211(3C) of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility :

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

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

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

Opinion :

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:

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

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

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

Report on Other Legal and Regulatory Requirements :

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of Section 227(4A) 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, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

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

e. On the basis of the written representations received from directors as on March 31, 2014, 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 Section 274(1)(g) of the Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in Paragraph 1 under the heading of "report on other legal and regulatory requirements" of our report of even date

As required by the Companies (Auditor''s Report) Order 2003, issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956 and according to the information and explanations given to us during the course of the audit and on the basis of such checks as were considered appropriate, we further state that :- i. a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets;

b) As explained to us, the fixed assets have been physically verified by the Management at the end of the year. It has been reported to us that, no material discrepancies have been noticed on such verification;

c) In our opinion, the Company has not disposed of substantial part of fixed assets during the year;

ii. a) It is reported that, the inventories have been physically verified by the management at the end of the year;

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 and as explained to us there were no material discrepancies noticed on physical verification of inventory as compared to book records;

iii. a) The Company has granted unsecured loans aggregating Rs. 3455.53 lacs during the year to two Companies, covered in the register maintained under Section 301 of the Companies Act, 1956.

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

c) The parties to whom loans have been given by the Company are repaying the principal amounts as stipulated and interest thereon wherever applicable;

d) There are no overdue amounts in respect of loans given by the Company;

e) The Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956;

iv. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventories, fixed assets and also for the sale of goods and services. There are no continuing failure to correct major weaknesses in the internal control;

v. a) According to the information and explanations given to us, the transactions that need to be entered in the register maintained U/s 301 of the Companies Act, 1956,have been so entered;

b) According to the information and explanations given to us, these transactions have been made at prices which are reasonable having regard to prevailing market prices at the relevant time where such market prices are available;

vi. The Company has accepted deposits from the public and has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed thereunder, and the directives issued by the Reserve Bank of India;

vii. The Company has appointed independent internal auditors and in our opinion the internal audit system is commensurate with the size and nature of its business;

viii. We have broadly reviewed the records maintained by the Company pursuant to the order made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However no detailed examination of such accounts and records have been carried out by us;

ix. a) According to the records of the Company, undisputed statutory dues including Provident Fund. Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues have been regularly deposited during the year 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, Custom Duty, Excise Duty and Cess were in arrears as on 31st March, 2014 for a period of more than six months from the date they became payable;

c) The disputed Statutory dues aggregating Rs. 155.88 lacs that have not been deposited on account of disputes and matters pending before appropriate authorities are as under:-

S.NO. Nature of the dues Forum where the dispute Amount is pending (Rs. in lacs) 1 Excise Duty High Court, Mumbai. (Dept''s Appeal) 20.96

2 Excise Duty CESTAT (Dept''s appeal) 60.05

3 Excise Duty CESTAT (Dept''s appeal) 0.51

4. Excise Duty CESTAT Dy. Commissioner (Central Excise) 4.46

5. Customs CESTAT 68.32

6. Service Tax CESTAT (Service Tax) (Dy.Commissoner) 1.58

x. The Company has no accumulated losses and it has not incurred cash losses during the year under report and the immediately preceding financial year;

xi. According to the information and explanations given to us, the Company has not committed any default in repayment of dues to financial institutions or banks or debenture holders;

xii. In our opinion and according to the information and explanations given to us, the company has not granted any loans on the basis of Security by way of pledge of shares, debentures and other securities;

xiii. In our opinion the Company is not a nidhi, mutual benefit fund or a society;

xiv. In our opinion and according to the information and explanations given to us the Company is not dealing or trading in shares, securities, debentures and other investments;

xv. The Company has given guarantees for loan and other credit facilities taken by others from Bank and according to the information and explanations given to us, the terms and conditions of such guarantees are not prejudicial to the interest of the Company.

xvi. According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained;

xvii. In our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, We report that no funds raised on short term basis have been used for long term investment;

xviii. According to the information and explanations given to us, during the year under report the Company has not made any allotment of shares;

xix. According to the information and explanations given to us, the Company has not issued any debentures and hence the question of creating security or charge therefor does not arise;

xx. During the year under report, no public issue has been made by the Company;

xxi. 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 course of our audit.

For KHARE & CO.,

Chartered Accountants, FRN 105100W

Y.P. SHUKLA

Place : Mumbai, Proprietor.

Dated : 17th May, 2014 Membership No. 16203


Mar 31, 2013

Report on the Financial Statements:

We have audited the accompanying financial statements of Pudumjee Pulp and Paper Mills Ltd. ("the Company"), which comprise the Balance Sheet as at March 31, 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 Section 211(3C) of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility:

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, 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 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:

(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 Section 227(4A) 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, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

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

e. On the basis of the written representations received from directors as on March 31, 2013, 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 Section 274(1)(g) of the Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in Paragraph 1 under the heading of "report on other legal and regulatory requirements" of our report of even date

As required by the Companies (Auditor''s Report) Order 2003, issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956 and according to the information and explanations given to us during the course of the audit and on the basis of such checks as were considered appropriate, we further state that :- i- a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets;

b) As explained to us, the fixed assets have been physically verified by the Management at the end of the year.

It has been reported to us that, no material discrepancies have been noticed on such verification;

c) In our opinion, the Company has not disposed of substantial part of fixed assets during the year;

ii a) It is reported that, the inventories have been physically verified by the management at the end of the year;

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 and as explained to us there were no material discrepancies noticed on physical verification of inventory as compared to book records;

iii a) The Company has granted unsecured loans aggregating Rs. 3800.28 lacs during the year to two Companies, covered in the register maintained under Section 301 of the Companies Act, 1956.

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

c) The parties to whom loans have been given by the Company are repaying the principal amounts as stipulated and interest thereon wherever applicable;

d) There are no overdue amounts in respect of loans given by the Company;

e) The Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956;

iv. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventories, fixed assets and also for the sale of goods and services. There are no continuing failure to correct major weaknesses in the internal control; v. a) According to the information and explanations given to us, the transactions that need to be entered in the register maintained U/s 301 of the Companies Act, 1956,have been so entered; b) According to the information and explanations given to us, these transactions have been made at prices which are reasonable having regard to prevailing market prices at the relevant time where such market prices are available;

vi. The Company has accepted deposits from the public and has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed thereunder, and the directives issued by the Reserve Bank of India;

vii. The Company has appointed independent internal auditors and in our opinion the internal audit system is commensurate with the size and nature of its business;

viii. We have broadly reviewed the records maintained by the Company pursuant to the order made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However no detailed examination of such accounts and records have been carried out by us;

ix a) According to the records of the Company, undisputed statutory dues including Provident Fund. Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues have been regularly deposited during the year 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, Custom Duty, Excise Duty and Cess were in arrears as on 31st March, 2013 for a period of more than six months from the date they became payable;

c) The disputed Statutory dues aggregating Rs.155.88 lacs that have not been deposited on account of disputes and matters pending before appropriate authorities are as under:-

S. No Nature of the dues Forum where the dispute is pending Amount (Rs. in lacs)

1 Excise Duty High Court, Mumbai.(Dept''s Appeal) 20.96

2 Excise Duty CESTAT (Dept''s appeal) 60.05

3 Excise Duty CESTAT (Dept''s appeal) 0.51

4. Excise Duty CESTAT Dy.Commissioner (Central Excise) 4.46

5. Customs CESTAT 68.32

6. Service Tax CESTAT (Service Tax) (Dy.Commissoner) 1.58

x. The Company has no accumulated losses and it has not incurred cash losses during the year under report and the immediately preceding financial year;

xi. According to the information and explanations given to us, the Company has not committed any default in repayment of dues to financial institutions or banks or debenture holders;

xii. In our opinion and according to the information and explanations given to us, the company has not granted any loans on the basis of Security by way of pledge of shares, debentures and other securities;

xiii. In our opinion the Company is not a nidhi, mutual benefit fund or a society;

xiv. In our opinion and according to the information and explanations given to us the Company is not dealing or trading in shares, securities, debentures and other investments;

xv. The Company has given guarantees for loan and other credit facilities taken by others from Bank and according to the information and explanations given to us, the terms and conditions of such guarantees are not prejudicial to the interest of the Company.

xvi According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained;

xvii In our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, We report that no funds raised on short term basis have been used for long term investment;

xviii According to the information and explanations given to us, during the year under report the Company has not made any allotment of shares;

xix. According to the information and explanations given to us, the Company has not issued any debentures and hence the question of creating security or charge therefor does not arise;

xx. During the year under report, no public issue has been made by the Company;

xxi. 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 course of our audit. For KHARE & CO.,

Chartered Accountants,

FRN 105100W

Y.P. SHUKLA

Place : Mumbai, Proprietor.

Dated : 23rd May, 2013. Membership No. 16203


Mar 31, 2012

We have audited the attached Balance Sheet of Pudumjee Pulp & Paper Mills Ltd., as at 31st March, 2012 and also the Profit and Loss Account and Cash Flow Statement annexed thereto for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from any 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

We report that:

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

(b) In our opinion, proper books of 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 and the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion the said Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards as referred to in Sub-section (3C) of Section 211 of the Companies Act, 1956.

(e) On the basis of information and explanations given to us, and representations obtained by the Company and taken on record by the Board of Directors, we report that there are no directors of the Company who are disqualified under section 274(1) (g) of the Act, from being appointed as directors during the year.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with other notes thereon give the information required by law in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India;

i. In the case of the Balance sheet of the state of affairs of the Company as at 31st March 2012;

ii. In the case of the Profit and Loss Account of the Profit for the year ended on that date and

iii. In the case of the Cash Flow Statement of the cash flows for the year ended on that date;

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

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

b) As explained to us, the fixed assets have been physically verified by the Management at the end of the year. It has been reported to us that, no material discrepancies have been noticed on such verification;

c) In our opinion, the Company has not disposed of substantial part of fixed assets during the year;

ii. a) It is reported that, the inventories have been physically verified by the management at the end of the year;

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 and as explained to us there were no material discrepancies noticed on physical verification of inventory as compared to book records;

iii. a) The Company has granted unsecured loans aggregating Rs. 6099.40 lacs during the year to two Companies, covered in the register maintained under Section 301 of the Companies Act, 1956.

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

c) The parties to whom loans have been given by the Company are repaying the principal amounts as stipulated and interest thereon wherever applicable;

d) There are no overdue amounts in respect of loans given by the Company;

e) The Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956;

Iv. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventories, fixed assets and also for the sale of goods and services. There are no continuing failure to correct major weaknesses in the internal control;

v. a) According to the information and explanations given to us, the transactions that need to be entered in the register maintained U/s 301 of the Companies Act, 1956,have been so entered;

b) According to the information and explanations given to us, these transactions have been made at prices which are reasonable having regard to prevailing market prices at the relevant time where such market prices are available;

vi. The Company has accepted deposits from the public and has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed thereunder, and the directives issued by the Reserve Bank of India;

vii. The Company has appointed independent internal auditors and in our opinion the internal audit system is commensurate with the size and nature of its business;

viii. We have broadly reviewed the records maintained by the Company pursuant to the order made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However no detailed examination of such accounts and records have been carried out by us;

ix. a) According to the records of the Company, undisputed statutory dues including Provident Fund.

Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues have been regularly deposited during the year 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, Custom Duty, Excise Duty and Cess were in arrears as on 31st March, 2012 for a period of more than six months from the date they became payable;

c) The disputed Statutory dues aggregating Rs. 154.47 lacs that have not been deposited on account of disputes and matters pending before appropriate authorities are as under:-

S. No Nature of the dues Forum where the dispute is pending Amount (Rs. in lacs)

1 Excise Duty High Court, Mumbai (Dept's Appeal) 20.96

2 Excise Duty CESTAT (Dept's appeal) 60.05

3 Excise Duty CESTAT (Dept's appeal) 0.51

4 Excise Duty CESTAT Dy.Commissioner (Central Excise) 3.82

5 Customs CESTAT 68.32

6 Service Tax CESTAT (Service Tax) (Dy.Commissoner) 0.81

x. The Company has no accumulated losses and it has not incurred cash losses during the year under report and the immediately preceding financial year;

xi. According to the information and explanations given to us, the Company has not committed any default in repayment of dues to financial institutions or banks or debenture holders;

xii. In our opinion and according to the information and explanations given to us, the company has not granted any loans on the basis of Security by way of pledge of shares, debentures and other securities;

xiii. In our opinion the Company is not a nidhi, mutual benefit fund or a society;

xiv. In our opinion and according to the information and explanations given to us the Company is not dealing or trading in shares, securities, debentures and other investments;

xv. The Company has given guarantees for loan and other credit facilities taken by others from Bank and according to the information and explanations given to us, the terms and conditions of such guarantees are not prejudicial to the interest of the Company.

xvi. According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained;

xvii. In our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, We report that no funds raised on short term basis have been used for long term investment;

xviii. According to the information and explanations given to us, during the year under report the Company has not made any allotment of shares;

xix. According to the information and explanations given to us, the Company has not issued any debentures and hence the question of creating security or charge therefor does not arise;

xx. During the year under report, no public issue has been made by the Company;

xxi. 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 course of our audit.

For KHARE & CO.,

Chartered Accountants,

FRN 105100W

Y.P. SHUKLA

Membership No. 16203

Proprietor.

Mumbai,

Dated: 29th May, 2012.


Mar 31, 2011

We have audited the attached Balance Sheet of Pudumjee Pulp & Paper Mills Ltd., as at 31st March, 2011 and also the Profit and Loss Account and Cash Flow Statement annexed thereto for the year ended on that date. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from any 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

We report that:

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

(b) In our opinion, proper books of 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 and the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion the said Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards as referred to in Sub-section (3C) of Section 211 of the Companies Act, 1956.

(e) On the basis of information and explanations given to us, and representations obtained by the Company and taken on record by the Board of Directors, we report that there are no directors of the Company who are disqualified under section 274(1) (g) of the Act, from being appointed as directors during the year.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with other notes thereon give the information required by law in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India;

i. In the case of the Balance sheet of the state of affairs of the Company as at 31st March 2011;

ii. In the case of the Profit and Loss Account of the Profit for the year ended on that date and

iii. In the case of the Cash Flow Statement of the cash flows for the year ended on that date;

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

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

b) As explained to us, the fixed assets have been physically verified by the Management at the end of the year. It has been reported to us that, no material discrepancies have been noticed on such verification;

c) In our opinion, the Company has not disposed of substantial part of fixed assets during the year;

ii a) It is reported that, the inventories have been physically verified by the management at the end of the year;

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 and as explained to us there were no material discrepancies noticed on physical verification of inventory as compared to book records;

iii a) The Company has granted unsecured loans aggregating Rs.2278.99 lacs during the year to two

Companies, covered in the register maintained under Section 301 of the Companies Act, 1956. ~<

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

c) The parties to whom loans have been given by the Company are repaying the principal amounts as stipulated and interest thereon wherever applicable;

d) There are no overdue amounts in respect of loans given by the Company;

e) The Company has not taken any loan, secured or unsecured from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956;

iv. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventories, fixed assets and also for the sale of goods and services. There are no continuing failure to correct major weaknesses in the internal control;

v. a) According to the information and explanations given to us, the transactions that need to be entered in the register maintained U/s 301 of the Companies Act, 1956,have been so entered;

b) According to the information and explanations given to us, these transactions have been made at prices which are reasonable having regard to prevailing market prices at the relevant time where such market prices are available;

vi. The Company has accepted deposits from the public and has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed thereunder, and the directives issued by the Reserve Bank of India;

vii. The Company has appointed independent internal auditors and in our opinion the internal audit system is commensurate with the size and nature of its business;

viii. We have broadly reviewed the records maintained by the Company pursuant to the order made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Compa- nies Act, 1956 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However no detailed examination of such accounts and records have been carried out by us;

ix a) According to the records of the Company, undisputed statutory dues including Provident Fund. Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues have been regularly deposited during the year 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, Custom Duty, Excise Duty and Cess were in arrears as on 31st March, 2011 for a period of more than six months from the date they became payable;

c) The disputed Statutory dues aggregating Rs. 154.52 lacs that have not been deposited on account of disputes and matters pending before appropriate authorities are as under:-

S. No Nature of the dues Forum where the dispute is pending Amount (Rs. in lacs)

1 Excise Duty High Court, Mumbai. (Dept's Appeal) 20.96

2 Excise Duty CESTAT (Dept's Appeal) 60.05

3 Excise Duty CESTAT (Dept's Appeal) 3.54

4 Customs Commissioner Customs (Import) 68.32

5 Service Tax Commissioner (Service Tax)/(Dept's Appeal) 1.65

x. The Company has no accumulated losses and it has not incurred cash losses during the year under report and the immediately preceding financial year;

xi. According to the information and explanations given to us, the Company has not committed any default in repayment of dues to financial institutions or banks or debenture holders;

xii. In our opinion and according to the information and explanations given to us, the company has not granted any loans on the basis of Security by way of pledge of shares, debentures and other securities;

xiii. In our opinion the Company is not a nidhi, mutual benefit fund or a society;

xiv. In our opinion and according to the information and explanations given to us the Company is not dealing or trading in shares, securities, debentures and other investments;

xv. The Company has given guarantees for loan and other credit facilities taken by others from Bank and according to the information and explanations given to us,the terms and conditions of such guarantees are not prejudicial to the interest of the Company.

xvi According to the information and explanations given to us, the term loans were applied for the purpose for which they were obtained;

xvii In our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet of the Company, We report that no funds raised on short term basis have been used for long term investment;

xviii According to the information and explanations given to us, during the year under report the Company has not made any allotment of shares;

xix. According to the information and explanations given to us, the Company has not issued any debentures and hence the question of creating security or charge therefor does not arise;

xx. During the year under report, no public issue has been made by the Company;

xxi. 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 course of our audit.

For KHARE & CO.

Chartered Accountants (FRN 105100W)

Y. P. SHUKLA

Mumbai Proprietor

Date : 26th May, 2011. Membership No. 16203

 
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