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Auditor Report of S R Industries Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of S.R INDUSTRIES LTD., which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss and Cash Flow Statement for the period then ended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Section 133 of the Companies Act, 2013 (The Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatements, 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, 2015;

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

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

Report on other Legal and Regulatory requirements.

1. As required by the Companies (Auditor's Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (3) of Section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs of the Order.

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

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

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

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

d) In our opinion, the Balance Sheet Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in Section 133 of The Act.

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

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of S.R INDUSTRIES on the accounts of the Company for the period ended 31st March, 2015.

On the basis of such checks as we considered appropriate during the course of our audit, and according to the information and explanations given to us, we report that:

1. IN RESPECT OF ITS FIXED ASSETS:

a. The Company has maintained proper records showing full particulars including quantitative details and the situation of fixed assets on the basis of available information.

b. As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such physical verification.

c. In our opinion, the Company has not disposed off a substantial part of its fixed assets during the year and the going concern status of the Company is not affected.

2. IN RESPECT OF INVENTORIES:

a. The Inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b. According to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is 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 material discrepancies noticed on physical verification of inventories as compared to the book records. However minor discrepancies noticed on verification between the physical stocks were properly adjusted in the consumption of stores.

3. IN RESPECT OF LOANS GIVEN:

According to the information and explanations given to us and on the basis of our examination of the books of accounts, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties listed in the register maintained under Section 189 of The Act

4. IN RESPECT OF INTERNAL CONTROL:

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

5. IN RESPECT OF DEPOSIT FROM PUBLIC:

According to information and explanations given to us, the Company has not accepted any deposits from the public.

6. COST ACCOUNTING RECORDS:

We have reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under sub-section (1) of section 148 of the Act but and are of the opinion that the prescribed accounts and records have been made and maintained, However we have not vouched the said records.

7. IN RESPECT OF STATUTORY DUES:

(a) The Company is not regular in depositing undisputed statutory dues with the appropriate authorities such as Gratuity, ESI, EPF, TCS, TDS, Excise Duty, Service Tax and CST. However, as at 31st March 2015, there are no such dues outstanding for a period of more than six months from the date they became payable.

(b) The following are disputed amounts outstanding, but were not paid by the Company as at 31st March 2015:

Name Nature of Dues Amount Forum where of the (Rs in Lacs) dispute is Statute pending

Excise Duty Excise Duty 258.70 CESTAT

Excise Duty Excise Duty 723.00 CESTAT

(c) As per information and explanations given to us, the company was not required to transfer any amount in Investor Education and Protection Fund.

B. LOSS MAKING COMPANY:

The Company has accumulated losses of Rs.2567.83 Lacs at the end of the financial year which is more than 50% of the net worth of the Company. Further, the Company has not incurred cash loss during the financial year covered by our audit and in the immediately preceding financial year.

9. REPAYMENT OF DUES:

Based on our audit procedures and according to the information and explanations given to us, the Company has paid dues to banks with certain delays. The overdue amounts as at 31st March 2015 were Rs. 65.39 Lacs out of which Rs. 20.72 Lacs has since been paid.

10. GUARANTEE GIVEN:

As per the information and explanations given to us, we report that the company has not given guarantee for the loans taken by others from banks or financial institutions

11. END -USE-OF BORROWING:

As per the information and explanations given to us, we report that the Company has not raised any term loans during the year.

12. FRAUDS:

Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the company has been noticed or reported during the period under audit

FOR KANSAL SINGLA & ASSOCIATES Chartered Accountants

Place: Chandigarh Date: May 8, 2015

sd/-

C.A. Surender Kumar Partner M.No.070405 FRN No 03897N


Mar 31, 2014

We have audited the accompanying financial statements of S.R INDUSTRIES LTD., which comprise the Balance Sheet as at March 31,2014, the Statement of Profit and Loss and Cash Flow Statement for the period then ended and a summary of significant accounting policies and other explanatory Information.

Management's Responsibility tor the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company In accordance with the Accounting standards referred to in sub-section (3C) of Section 211, of the Companies Act. 1856 (The Act,) This responsibility Indudes the design, implementation and maintenance of Internal control relevant to the preparation and presentation of the financial statements that give a true and fair view end are free from material misstatements, whether due to fraud or error.

Auditor's Responsibility

Our responsibility Is to express an opinion on these financial statements baaed 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 lo design audit procedures that are appropriate In the, circumstances,. An audit also Includes evaluating the appropriateness of accounting policies used and the reason ableness 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 la sufficient and appropriate to provide a basts lor our audit opinion.

Opinion

In our opinion and to the best of our Information end 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 geneally accepted In India:

a) In the case of the Balance Sheet, of the slate of affaire of the Company as at Match 31.2014;

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

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

Report on other legal and Regulatory requirements.

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

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

a) We have obtained at 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 tar as appears from our examination of those books

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

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

e) On the basis of written representations received from the directors 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 Act,

THE ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE OUR REPORT OF EVEN DATE TO THE MEMBERS OF S.R. INDUSTRIES ON THE ACCOUNTS OF THE COMPANY FOR THE PERIOD ENDED MARCH 31 2014

On the basis of such checks as we considered appropriate and according to the Information and explanations given to us. during the course of our audit, we report that

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

(b) As explained lo us, fixed assets have been physically verified by the management at reasonable Intervals and no material discrepancies were noticed on such verification

(c) During the year, the Company has not disposed off any part of the plant and machinery affecting the going concern status of the Company

2. (a) According to the Information and explanations given to us, the Inventory has been physically verified by the Stock auditors till 31st January 2014 In terms of their appointment by the bankers, we have relied upon the physical verification done by the said auditor.

(b) In our opinion and according lo the Information and explanations given to us, the procedures of physical verification of inventories ere reasonable and adequate in relation to the size of the Company and the nature of lb business'

(C) The Company Is maintaining proper records of Inventory. AS explained to us. no material discrepancies were noticed on physical verification' However minor discrepancies noticed on verification between the physical stocks were properly adjusted In the consumption of stores

3. (a) According to the information and explanations given to us and on the basis of our examination of the books of accounts, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties listed In the register maintained under Section 301 of The ACT.

(b) As per Information given and records produced before us. the Company he* taken unsecured loans from two Directors. The Balance outstanding as at 31st march 2014 from these parties amounts to Rs 567.60 lacs and maximum amount outstanding during the year was Rs 646.40 lacs.

(c) As explained to us, the terms 8 conditions on which such loans were accepted are not prejudicial to the Interest of the Company.

(d) No stipulation has been specified lor the repayment of these loans.

4. In our opinion and according to the Information and explanations given to us, there Is generally an adequate Internal control procedure commensurate with the size of the Company and the nature of Its business, for the purchase of Inventories & fixed assets and payment for expenses & for sale of goods. During the course of our audit, no major instance of continuing failure to correct any weaknesses In the internal control system has been noticed.

5. According to the information and explanations provided by the management, the particulars of contracts or arrangements that need to be entered Into the register maintained under section 301 of the Act have been so entered'

6. In our opinion and according to the Information and explanations given to us, the Company has not accepted the deposits covered as per the provisons of sections 58A and 58AA or any other provisions of the Act.

7. As per information 4 explanations given by the management' the Company has an internal audit system commensurate with Its size and the nature of Its business'

8. Maintenance of cost records has been prescribed by the Central Government under clause (d) of sub-section M) of section 209 of the Act As per Information 4 explanations given by the management we are of the opinion that prims facie the prescribed accounts end records have been made and maintained'

8. (a) The company Is not regular In depositing undisputed statutory dues with the appropriate authorities. However, as at 311 March 2014, there are no such dues outstanding for a period of more than six months tram the date they became payable'

(b) The following are disputed amounts outstanding, but were not paid by the Company as at 31St March 2014;

New of the Nature of Amount in Forum where Statue Duet Dues dispute it pending

Income Tax Demand u/s 1471143 (3) 43.02 CIT (Appeals), chd

Excise Duty Excise Duty 258.70 CESTAT

Excite Duty Excite Duty 723.00 CESTAT

10. The Company has accumulated loss of Rs.2673.18 lacs at the end of the financial year which la more than 50% of the net worth of the Company. Further, the Company has not incurred cash loss during the financial year covered by our audit. However there was a cash loss of Rs. 216.84 lacs during the Immediatety preceding financial year

11. In our opinion and according to the Information and explanations given to us during the year under audit, the company has paid with certain delays,'the amounts due to banks and financial Institutions. The overdue amounts as at 31st March 2014 was Rs 131.99 Lacs out of which Ra. 115.23 lacs has since been paid

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 fond or a nidhi/mutual benefit fond/ society.

14. According to information and explanations given to us, the Company is not trading in Shares. Mutual funds & other Investments'

15. According to the Information and explanations given to us, the company has not given any guarantees for loan taken by others from any bank or financial Institution.

16. Based on our audit procedures and on the information given by the management, we report that the Company has not raised any term loans during the year.

17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31 at March, 2014, we report that no funds raised on short-term basis have been used for tong-term Investment by the Company.

18. According to the Information and explanations given to us, the Company has not made preferential allotment of equity shares to parties covered in the Register maintained under Section 301 of The Act.

18. The Company has not Issued any debentures during the period under audit.

20. According to the information and explanations given to us. during the period covered by our audit report, the Company has not raised any money by public issue of equity shares.

21. Based on the audit procedures performed end the Information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management,

FOR KANSAL SINGLA & ASSOCIATES Chartered Accountants

Place; Chandigarh Date; May 31, 2014 sd/-

CA S.K, Arora Partner M.No.070405 FRN No. 03897N








Mar 31, 2013

1. Report on the Financial Statements

We have audited the accompanying financial statement of S.R. Industries Limited, which comprise the Balance Sheet as at March 31, 2013, the Statement of Profit and Loss and Cash Flow Statement for the period then ended and a summary of significant accounting policies and other explanatory information.

2. Management''s Responsibility for the Financial Statements

Management is responsible for the preperation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sun-section (3C) of Section 211 of the Companies Act, 1956 (The Act). This responsibility includes the design, implementation and maintainence 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 misstatements, whether due to fraud or error.

3. 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 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 appropiate 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.

4. 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 ad 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 Account, for the period ended on that date; and

c) In the case of the Cash Flow Statement, of the cash flows for the period ened on that date.

5. Report on other Legal and Regulatory requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 (“theOrder”) issued by the Central Goverment of India in terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure a statement on the metters specified in paragraphs 4 and 5 of the order.

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

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

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of Section 211 of the Act, except non- provision of liability as required by AS-15 “ACCOUNTING FOR RETIREMENT BENEFITS”.

e) On basis of written representations received from the directors 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 Act.

THE ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE OUR REPORT OF EVEN DATE TO THE MEMBERS OF S.R. INDUSTRIES LIMITED ON THE ACCOUNTS OF THE COMPANY FOR THE PERIOD ENDED MARCH 31, 2013.

On the basis of such checks as we considered appropriate and according to the information and explanations given to us, during the course of our audit, we report that;

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

(b) As explained to us, fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies were noticed on such verification.

(c) During the year, the Company has not disposed off any part of the plant and machinery affecting the going concern status of the Company.

2. (a) According to the information and explanations given to us, the inventory has been physically verified by the stock auditors till April 30, 2013 in terms of their appointment by the bankers and quantitative details have been reconciled up to March 31, 2013. We have relied upon the physical verification done by the said auditor.

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

(c) The Company is maintaining proper records of inventory. As explained to us, no material discrepancies were noticed on physical verification. However minor discrepancies noticed on verification between the physical stocks were properly adjusted in the cosumption of stores.

3. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties listed in the register maintained under Section 301 of the Act.

(b) As per information given and records produced before us, the Company has taken unsecured loans from two Directors and Companies covered in the Register maintained under Section 301 of The Act. The Balance outstanding as at March 31, 2013 from these parties amounts to Rs 646.39 lacs and maximum amount outstanding during the year was Rs 1022.93 lacs.

(c) As explained to us, the terms & conditions on which such loans were accepted are not prejudicial to the interest of the Company.

(d) No stipulation has been specified for the repayment of these loans.

4. In our opinion and according to the information and explanations given to us, there is generally an adequate internal control procedure commensurate with the size of the Company and the nature of its business, for the purchase of inventories & fixed assets and payment for expenses & for sale of goods. During the course of our audit, no major instance of continuing failure to correct any weaknesses in internal controls has been noticed.

5. According to the information and explanations provided by the management, the particulars of contracts or arrangements that need to be entered into register maintained under Section 301 of The Act have been so entered.

6. In our opinion and according to the information and explanations given to us, the Company has not accepted the Deposits covered as per the provisions of Sections 58A and 58AA or any other provisions of The Act. However, the company has accepted unsecured loans from directors and intercorporate loans from Companies which are within exempted category of the said section.

7. As per information & explanations given by the management, the Company has an internal audit system commensurate with the size and nature of its business.

8. As per information & explanations given by the management, maintenance of cost records has been prescribed by the Central Goverment under clause (d) of sub-section (1) of Section 209 the Act and we are of the opinion that prima-facie the prescribed accounts and records have been made and maintained.

9. (a) The Company is regular in depositing undisputed dues for

a period of more than six month for the date they became payable with appropiate authorities except Service Tax and Provident fund.

(b) According to the information and explanations given to us Rs 21.31 lacs payable in respect of provident fund and Rs. 1.60 lacs payable in respect of service tax were in arrears as at March 31, 2013 for a period more than six months from the date they became payable.

(c) The following are disputed amounts Outstanding for a period of more than six months from the date they became payable, but were not paid by the Company as at March 31, 2013.

10. The Company has accumulated loss of Rs.2687.93 lacs at the end of the financial year. Further, the Company has incurred cash loss of Rs.218.84 lacs during the financial year covered by our audit and Rs 1302.79 lacs during the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has paid with certain delays, the amounts due to banks and financial institutions. The overdue interest of Rs.35.04 Lacs as on March 31, 2013 has since been paid.

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.

14. According to the information and explanations given to us, the Company is not trading in Shares, Mutual funds & other investments.

15. According to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from any banks or financial institution.

16. Based on our audit procedure and on the information given by the management, we report that the Company has not raised any term loans during the year.

17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at March 31, 2013, we report that the no funds raised on short-term basis have been used for long-term investment by the Company.

18. According to the information and explanations given to us, the Company has made preferential allotment of equity shares to parties covered in the Register maintained under Section 301 of The Act. The price at which such shares are allotted is not prejudicial to the interest of the Company.

19. The Company has not issued any debentures during the period under audit.

20. According to the information and explanations given to us, during the period covered by our audit report, the Company has not raised any money by public issue of equity shares.

21. Based on the audit procedures and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management.

FOR KANSAL SINGLA & ASSOCIATES

Chartered Accountants

sd/-

C.A. S.K. Kansal

Partner

Place: Chandigarh M.No.080632

Date: May 28, 2013 FRN No. 03897N


Jun 30, 2012

1. We have audited the attached Balance Sheet of S.R. Industries Limited as at 30th June, 2012. Statement of Profit & Loss Account and Cash Flow Statement for the fifteen months period ended on that date, annexed thereto. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. These 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 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 statements presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor''s Report) Order (Amendment). 2004 issued by the Central Government of India in terms or sub- section (4A) of Section 227 of the Companies Act: 1956 (The Act), we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in 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 purpose of our audit

(ii) in our opinion, proper books of account as required by law have been kept by the Company so (ar as appears from our examination ol those books.

(iii) the Balance Sheet. Statement of Profit & Loss Account and Cash Flew Statement dealt with by this report are in agreement with the books of accounL

(iv) In our opinion, the Balance Sheet Statement of Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to In sub-section (3C) of Section 211 of The Act.

(v) on the basis of the written representations received from the directors and taken on record by the Board of Directors, we report that none of the directors is disqualified as at 30th June, 2012 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of The Act.

(vi) In our opinion and to the best of our Information and according to the explanation given to us, the said accounts subject to and notes (vli) & (vlii) of Note 21 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 30th June, 2012,

b. In the case of the Statement of Profit and Loss account, of the Loss for the fifteen months period ended on that date and

c. In the case of Cash Flow Statement of the Cash Flows Tor the fifteen months period ended on that date.

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

(b) As per information given and records produced before us, all the assets have been physically verified by the management during the period. In our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such verification were not significant in nature and have been properly dealt with.

(c) During the period, the Company has disposed off its terry towel division at Derabassi. however, it does not affect the going concern status of the Company as footwear division at Village. Singha Distt. Una(H.P.) is in operation.

(ii) (a) As per information given and records produced before us, the Inventories except small items of stores and spares has been physically verified during the period by the management tn our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its business. As regards Stores and Spares, there are numerous small items, total value of which is insignificant as compared to total inventories. .

(b) The procedures of physical verification of Inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventories. As explained to us. no material discrepancies were noticed on physical verification, however minor discrepancies noticed on verification between the physical and book stock has been properly adjusted.

(iii) (a) As per information given and records produced before us, the Company has not given any advance to the Companies/Parties , covered in the Register maintained under Section 301 of The Act.

(b) As per information given and records produced before us, the Company has taken unsecured loans and intercorporate deposits from Directors and Companies covered in the Register maintained under Section 301 of The Act Balance outstanding as at 30th June, 2012 from these parties amounts to Rs 621.69 lacs and maximum amount outstanding during the period was Rs 1544.05 lacs.

(c) As explained to us, the terms & conditions on which such loans were accepted are not prejudicial to the interest of the Company.

(d) No stipulation has been specified for the repayment of these loans.

(iv) In our opinion and according to the information and explanations given to us. it appears to be an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of Inventories, fixed assets and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) According to the information and explanations given to us. the particulars of contracts or arrangements that need to be entered into the Register maintained under Section 301 of The Act have been so entered.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted the Deposits covered as per the provisions of Sections 58A and 58AA or any other provisions ol The Act, and The Companies (Acceptance of Deposits) Rules. 1978. However, the company has accepted unsecured loans from directors and intercorporate loans from companies which are within exempted category of the said section.

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

(viii) According to the information and explanations given to us, the Central Government has prescribed the maintenance of cost records under Section 209 (1) (d) of The Act we have broadly reviewed these records maintained by the Company and are of the opinion that, prima-facie. the prescribed records seems to have been maintained.

(ix) (a) The Company Is not regular In depositing with appropriate '' authorities undisputed statutory dues such as Income Tax, Sates Tax, Service Tax, Excise Duty, Provident fund, ESI and other materia/ statutory dues applicable.

(b) According to Mie information and explanations given to us, Rs 23.33 lacs payable in rasped of provident fund wara in arrears, as at 30th June, 2012.

(c) According to the Information and explanations given to us, the disputed demand of excise duty against the Company amounting to Rs. 981.70 Lacs (Previous Year 981.70 Lacs) have not been deposited 3S appeals are pending willi CESTAT for the final adjudication.

(x) The Company has accumulated loss of Rs.2339.20 lacs at the end of the financial year. Further, the Company has incurred cash loss of Rs. 1302.79 lacs during the financial year covered by our audit and Rs 790.51 lacs during the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has defaulted In repayment of dues to banks amounting to Rs.69.91 lacs as at 30th June, 2012, However the same has been paid by 17th August, 2012.

(xii) In our opinion and according to the information and explanations given to us, the Company has not granted loans and advances on the basts of security by way of pledge of shares, debentures and other securities.

(xiii) in our opinion, the Company is not a chit fund or a nidhi mutual benefit fund/ society.

(xiv) In our opinion, the Company Is not dealing in or trading in shares, securities, debentures and other investments.

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

(xvi) According to the information and explanations given to us, the term loans raised during the period have been utilized for the purposes for which the same were taken.

(xvii) According to the Information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that the no funds raised on short-term basis have been used for long-term investment.

(xviii) According to the information and explanations given to us, the Company has made preferential allotment of equity shares to parties covered in the Register maintained under Section 301 of The Act. The price at which such shares are allotted is not prejudicial to (he interest of the Company.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the Company has not issued any debentures.

(xx) According to the information and explanations given to us. during the period covered by our audit report, the Company has not " raised any money by public issue of equity shares, however the '' Company has issued preferential equity shares, convertible share , warrants 5 non cumulative preference shares.

(xxi) 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 KANSAL SINGLA & ASSOCIATES

Chartered Accountants

C.A.S.K. Kansal

Partner

place: Chandigarh M. No.080632

Date: December 04, 2012 FRN No. 03897N


Mar 31, 2010

1. We have audited the attached Balance Sheet of M/s S R. Industries Limited as at March 31. 2010. the Profit & Loss Account and also the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with 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 of material misstatement An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together the "Order-) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act 1956 and on the basis of such checks of the books and records of the Company as we consider appropriate and according to the information and explanations given to us we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in 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

(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 & 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 & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

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

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

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

b) in the case of the Profit and Loss Account, of the loss for the year

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



ANNEXURE TO THE AUDITORS REPORT TO THE MEMBERS OF S.R.INDUSTRIES LIMITED ON THE ANNUAL ACCOUNTS FOR THE YEAR ENDED MARCH 31. 2010 (Referred to in paragraph 3 of our report of even date)

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

(b) According to the information and explanations given to us, all the assets have not been physically verified by the Management during the year, but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, no material discrepancies were noticed on such verifications.

(c) According to information and explanations given to us, during the year, the Company has disposed off a part of old obsolete plant and machinery which do not effect the going concern stap us of the Company as production has reduced marginally.

(II) (a)Accordingto information and explanations given to us, the inventory have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

(c)The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records were not material.

(iii) (a) According to information and explanations given to us, the Company has not granted any loan to the parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(b) According to the information and explanations given to us, the Companies Act, 1956 and an amount of Rs. 1138.80 lacs is outstanding as on March 31, 2010. The maximum amount outstanding during the year was Rs. 1141.58 lacs. In our opinion, the terms and conditions on which these loans have been taken are not prejudicial to the interest of the Company.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to sale of goods. During the course of our audit, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in internal control system.

(v) According to the information and explanations given to us, we are of the opinion that the particulars of transactions that need to be entered into the register maintained under Section 301 of the Companies Act 1956 have been so entered.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted the Deposits covered as per the provisions of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules 1975.

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

(viii)According to the information and exenlanations given to us, the maintenance of cost records have been prescribed b/the Central Government under Section 209(1 )(d) of the Companies Act, 1956 which are maintained by the Company. However, we have not made detailed scrutiny of these records.

(ix))(a)According to the records of the Company, the Company is generally regular in depositing with ap,ropriate authorities, undisputed statutory dues including provident fund investors education and protection fund employees state insurance, income tax, sales tax, wealth tax, custom duty excise duty, service tax, cess and other material statutory dues applicable to it with appropriate authorities.

(b)According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty were in arrearsas at 31st March, 2010 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to ur, the disputed demands of excise duty against the Company amounting to Rs. 981.70 lacs (previous year Rs. 981.70 lacs) have not been deposited as appeals are pending with CESTAT for final adjudication.

(x) The Company does not have any accumulated losses at the end of the financial year. Also, the company has not incurred any cash losses during the current financial year covered by our audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to the banks and has not issued any debentures.

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

(xiii)The Company is not a chit fund, nidhi or mutual benefit fund/society. Therefore Clause 4(xiii) of the said Order is not applicable to the

(xiv) The Company is not dealing in or trading in shares, secures, debentures and other investments. Therefore, Clause 4(xiv) of the said Order is not applicable to the Company

(xv) According to the information and explanations given to us, the Company has not given guarantees for loans taken by others from banks or financial institutions.

(xvi)ln our opinion, the term loans have been applied for the purpose for which they were raised.

(xvii) 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 to finance long-term investments. No long-term funds have been used to finance short-term investments except permanent working capital requirements.

(xviii) According to the information and explanations given to us, the Company has not made preferential allotment of shares to Parties and Companies in the register maintained under Section 301 of the Companies Act, 1956.

(xix)According to the information and explanations given to us, during the year covered by our audit report, the Company has not issued any debentures.

(xx) According to the information and explanation given to us, during the year covered by our audit report, the Company has not raised any money by public issue.

(xxi)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 our audit.

For KANSAL SINGLA & ASSOCIATES

Chartered Accountants

S.K. KANSAL

Place : Chandigarh Parter

Date : July 7, 2010 Membership No. 080632

FRN 003897N


Mar 31, 2009

1. We have audited the attached Balance Sheet of M/s S.R. Industries Limited as at March 31, 2009, the Profit & Loss Account and also the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with 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 of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together the "Order") issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we consider appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in 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 & 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 & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

(v) on the basis of the written representations received from the directors and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2009 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

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

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2009;

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 TO THE AUDITORS REPORT TO THE MEMBERS OF S.R.INDUSTRIES LIMITED ON THE ANNUAL ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2009

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

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

(b) According to the information and explanations given to us, all the assets have not been physically verified by the Management during the year, but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, no material discrepancies were noticed on such verifications.

(c) According to information and explanations given to us, during the year, the Company has not disposed off major part of the plant and machinery affecting the going concern status of the Company. Therefore Clause 4(i)(c) of the Companies (Auditors Report)Order, 2003 (hereinafter referred to as the "said Order") is not applicable to the company.

(ii) (a) According to information and explanations given to us, the inventory have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable,

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

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records were not material.

(iii) (a) According to information and explanations given to us, the Company has not granted any loan to the parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(b) According to the information and explanations given to us, the Company has taken unsecured loans from three directors and one company covered in the register maintained under Section 301 of the Companies Act, 1956 and an amount of Rs. 356.00 lacs is outstanding as on March 31, 2009. The maximum amount outstanding during the year was Rs. 356.00 lacs. In our opinion, the terms and conditions on which these loans have been taken are not prejudicial to the interest of the Company.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to sale of goods. During the course of our audit, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in internal control system.

(v) According to the information and explanations given to us, we are of the opinion that the particulars of transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted the Deposits covered as per the provisions of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

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

(viii) According to the information and explanations given to us,the maintenance of cost records has been prescribed by the Central Government under Section 209(1 )(d) of the Companies Act, 1956 which are maintained by the Company. However, we have not made detailed scrutiny of these records.

(ix) (a) According to the records of the Company, the Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including provident fund, investors education and protection fund, employees state insurance, income tax, sales tax, wealth tax, custom duty, excise duty, service tax, cess and other material statutory dues applicable to it with appropriate authorities.

Further, since the Central Government has not yet prescribed the amount of cess payable under Section 441A of the Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing the same.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty were in arrears, as at 31s March, 2009 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, the disputed demands of excise duty against the Company amounting to Rs. 981.70 lacs (previous year Rs. 981 70 lacs) has not been deposited as appeals are pending with CESTAT for final adjudication.

(x) The Company does not have any accumulated losses at the end of the financial year. Also, the company has not incurred any cash losses during the current financial year covered by our audit and in the immediately preceding financial year.

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

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

(xiii) The Company is not a chit fund, nidhi or mutual benefit fund/ society. Therefore, Clause 4(xiii) of the said Order is not applicable to the Company.

(xiv) The Company is not dealing in or trading in shares, securities, debentures and other investments. Therefore, Clause 4(xiv) of the said Order is not applicable to the Company.

(xv) According to the information and explanations given to us.the Company has not given guarantees for loans taken by others from banks or financial institutions.

(xvi) In our opinion, the term loans have been applied for the purpose for which they were raised.

(xvii) 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 to finance long-term investments. No long-term funds have been used to finance short-term investments except permanent working capital requirements.

(xviii) According to the information and explanations given to us,the Company has not made preferential allotment of shares to Parties and Companies in the register maintained under Section 301 of the Companies Act, 1956.

(xix) According to the information and explanations given to us, during the year covered by our audit report, the Company has not issued any debentures.

(xx) According to the information and explanation given to us, during the year covered by our audit report, the Company has not raised any money by public issue.

(xxi) 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 KANSAL SINGLA & ASSOCIATES

Chartered Accountants

S.K.KANSAL

Place: Chandigarh Partner

Date : June 30, 2009 Membership No. 080632



 
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