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Auditor Report of Shree Rama Multi-Tech Ltd.

Mar 31, 2016

To

The Members of

SHREE RAMA MULTI TECH LIMITED

Ahmedabad

Report on the Financial Statements

We have audited the accompanying financial statements of SHREE RAMA MULTI-TECH LIMITED (“the Company”) which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls.

An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

Basis for Qualified Opinion:

1. In respect of loans and debentures aggregating to Rs. 6171.86 lacs which are under settlement as per scheme, the company has not provided for interest of Rs. 854.72 lacs (Previous Year Rs. 1206.51 lacs) on the same for the year ending on 31st March, 2016. Therefore, loss of the year would have been increased by Rs. 854.72 lacs. The accumulated interest not provided for up to 31-03-2016 is Rs. 12119.05 lacs (Previous Year Rs. 16052.36 lacs).

2. Non consolidation of accounts of Shree Rama Mauritius Limited (Wholly Owned Subsidiary ) as per Sec.129 of the Act & Accounting Standard 21 of ICAI (refer note no.15)

Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the matters described in the basis for qualified opinion para above. If the provision for interest is made the loss for the current year would have increased by Rs. 854.72 lacs and accumulated losses upto 31/3/2016 would have increased by Rs. 12119.05 lacs and accordingly net loss for the current year would have been Rs.1066.28 lacs and accumulated losses up to 31/3/2016 would have been Rs. 63775.56 lacs, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2016 and its loss 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, 2016 (“the Order”), as amended, 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” a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

a. we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 it appears from our examination of those books;

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

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

e. On the basis of written representations received from the directors as on March 31, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

f. The qualification relating to non provision of interest for the current year and earlier years and Non consolidation of Accounts of Mauritius WOS are stated in the basis for Qualified opinion paragraph above,

g. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

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

(i) The company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 28[B](1) and 9(i)&(ii) to the financial statements;

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

(iii) There were no amounts (except annulled Dividend on preference share as per note No. 28[B] 3(b)) which were required to be transferred to the Investor Education and Protection Fund by the Company.

“Annexure A” to the Independent Auditors’ Report

Referred to in paragraph 1 under the heading ‘Report on Other Legal & Regulatory Requirements’ of our report of even date to the financial statements of the Company for the year ended March 31, 2016:

1. In respect of Fixed Assets :

(a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) The Fixed Assets have been physically verified by the management in a phased manner, designed to cover all the items over a period of five years, which in our opinion, is reasonable having regard to the size of the company and nature of its business. According to information and explanation given to us, no material discrepancies were noticed on such verification.

(c) The title deeds of immovable properties are mortgaged with the lenders and as informed to us the same are in the name of the company.

2. In respect of Inventories:

According to information and explanation given to us Physical verification of inventories has been conducted in reasonable interval by the Management and no material discrepancies were noticed on physical verification during the year.

3. According to information and explanation given to us, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability partnerships or other parties covered in the Register maintained under section 189 of the Act. Accordingly, the provisions of clause 3

(iii) (a) to (C) of the Order are not applicable to the Company and hence not commented upon.

4. In our opinion and according to the information and explanations given to us, the company has not granted loan or given guarantee or provided security as provided in the section 185 and 186 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security.

5. According to information and explanation given to us, the Company has not accepted any deposits from the public and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the public are not applicable.

6. The Central Government has prescribed maintenance of Cost Records under section 148(1) of the Companies Act,2013 in respect of manufacturing activities of the Company. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

7. According to information and explanations given to us in respect of statutory dues and on the basis of our examination of the books of account, and records,

(a) the Company has been regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Sales tax, Service Tax, Duty of Customs, Duty of Excise, Value added Tax, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2016 for a period of more than six months from the date on when they become payable.

b) According to the information and explanations given to us, there are no material dues of income tax, sales tax, and service tax, value added tax, wealth tax, duty of customs and Cess which have not been deposited with the appropriate authorities on account of any dispute, except in respect to income tax penalty and excise duty, the following dues have not been deposited by the Company on account of disputes according to information and explanations given to us, :

Name of the statute

Nature of the dues

Amount (Rs. in Lacs)

Period to which the amount relates

Forum where the dispute is pending

Central Excise Act, 1944

Excise Duty

3893.72

1999-00 to 2001-02

Adjudicating Authority,

293.42

1998-99

Gujarat High Court

Income Tax Act 1961

Penalty Sec.271(1)(c)

331.06 453.46 291.98 71.27

A.Y.2002-03 A.Y.2003-04 A.Y.2004-05 A.Y.2009-10

CIT (Appeal)

8. (i) The Company had default in respect of past borrowing loans, debentures etc for which the company has filed scheme of Arrangement and Compromise as mentioned in Note No. 6 of the Notes on Accounts.

(ii) There is no current default in repayment of dues to Financial Institutions or banks or debenture holders.

9. According to the information and explanations given by the management, the company has not raised moneys by way of initial public offer or further public offer including debt instruments and term Loans during the year. Accordingly, the provisions of clause 3 (ix) of the Order are not applicable to the Company.

10. According to the information and explanations given by the management, we report that no fraud by the Company or on the company by its officers or employees has been noticed or reported during the year.

11. According to the information and explanations given by the management, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act;

12. In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 4 (xii) of the Order are not applicable to the Company.

13. In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

14. According to the information and explanations given by the management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of clause 3 (xiv) of the Order are not applicable to the Company and hence not commented upon.

15. According to the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.

16. In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable to the Company and hence not commented upon.

Annexure ‘B’

Annexure to the Independent Auditor’s report of even date on the Standalone financial statements of Shree Rama Multi- Tech Ltd.

Report on the Internal Financial Controls under Clause (1) of Sub-section 3 of Sec.143 of the Companies Act,2013 (“the Act”)

We have audited the internal financial controls over financial reporting of Shree Rama Multi-Tech Limited (“the Company”) as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls systems over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting.

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purpose in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company. (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles , and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company, and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financials statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies of procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial control system over financial reporting and such internal financial controls over financial reporting was operating effectively as on March 31,2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reports issued by the Institute of Chartered Accountants of India.

For M/s. Mahendra N. Shah & Co

Chartered Accountants

Firm Registration No.

FRN 105775W

Place : Ahmedabad Chirag M. Shah

Date : 10.05.2016 Partner

Membership No. 045706


Mar 31, 2015

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of Shree Rama Multi-tech Limited ('the Company'), which comprise the balance sheet as at 31 March 2015, the statement of profit and loss and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

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

AUDITOR'S RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

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

BASIS FOR QUALIFIED OPINION:-

The Company has made borrowings in the form of loans, debentures etc.in earlier years which are under settlement. During the year the Company has not provided interest of Rs. 1206.51 lacs on such outstanding borrowings. The accumulated interest on such borrowings not provided for past several years up to 31/3/2015 is Rs. 16052.36 lacs. This matter is also qualified in our report on the Financial Statements for the year ended 31/3/2015.

OPINION

In our opinion and to the best of our information and according to the explanations given to us, except for the matter described in the Basis for qualified opinion paragraph above. If the provision for interest is made the loss for the current year would have increased by Rs.1206.51 lacs and accumulated losses upto 31/3/ 2015 would have increased by Rs. 16052.36 lacs and accordingly net loss for the current year would have been Rs. 2024.38 lacs and accumulated losses upto 31/3/2015 would have been Rs.67497.29 lacs, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2015 and its loss and its cash flows for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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

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

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

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

(c) the balance sheet, the statement of profit and loss and the cash flow statement dealt with by this Report are in agreement with the books of account;

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

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

(f) The qualification relating to non-provision of interest for the current year and earlier years are as stated in the basis for Qualified opinion paragraph above.

(g) We draw attention to note No 16 regarding revision in audited accounts on account of re- computation of depreciation on plant & machineries on account of redefining useful life of certain plant & machineries and accordingly depreciation of Rs 1589.94 lacs is charged to profit & loss account and Rs.377.51 lacs is charged to retained earnings, consequentially charge for the depreciation is lower by Rs 741.96 lacs and charge to retained earning is lower by Rs 1132.34 lacs and deferred tax assets has reduced by Rs 579.16 lacs as compared to earlier audited accounts.

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

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements – Refer Note 1 of 28B of to the financial statements;

ii. the Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses and iii. There has been no delay in transferring amounts except annulled Dividend on Preference shares (as per note no. 28 [B] 3(b)), required to be transferred, to the Investor Education and Protection Fund by the Company.

The Annexure referred to in our Independent Auditors' Report to the members of the Company on the financial statements for the year ended 31 March 2015, we report that :

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

The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of five years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

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

(b) The procedures of physical verification of inventory 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 inventory and no material discrepancies were noticed on physical verification.

(iii) The company has not granted loans to body corporate covered in register maintained under section 189 of the Companies Act, 2013 ('the Act').

(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 purchase of inventory and fixed assets and sale of goods & services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) The Company has not accepted any deposits from the public.

(vi) The Central Government has prescribed maintenance of Cost Records under section 148(1) of the Companies Act,2013 in respect of manufacturing activities of the Company. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, ESIC, income tax, sales tax, wealth tax, Excise service tax, duty of customs, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities except small delay in few cases. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income tax, sales tax, wealth tax, service tax, duty of customs, value added tax, Cess and other material statutory dues were in arrears as at 31 March 2015 for a period of more than six months from the date they became payable except what is stated hereafter.

(b) According to the information and explanations given to us, there are no material dues of income tax, sales tax, and service tax value added tax, wealth tax, duty of customs and Cess which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following excise duty dues have not been deposited by the Company on account of disputes:

Nature of Nature of Amount Period to which the amount relates Statute dues (Lacs)

Central Excise Act, 1944 Excise Duty 3893.72 1999-00 to 2001-02 293.42 1998-99

Nature of Statute Forum where dispute is pending

Central Excise Act, 1944 Adjudicating Authority,

Gujarat High Court

(c) According to the information and explanations given to us the amounts which were required to be transferred to the investor education and protection fund in accordance with the relevant to provisions of the companies Act, 2013 and rules there under transferred to such fund within time except dividend on preference shares as mentioned in note no. 28[B] 3(b).

(viii) The Company has accumulated losses at the end of the financial year and it has not incurred cash losses in the current financial year and in the immediately preceding financial year.

(ix) The Company is regular in repayment of dues to bank and there is no default in repayment of dues.

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

(xi) The Company has term loans outstanding of Rs. 6000 lacs during the year and in our opinion and according to the information and explanation given to us the Company has applied the term loans prima facie for the purpose for which the loans were obtained.

(xii) According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For, Mahendra N. Shah & Co.

Chartered Accountants

FRN 105775 W

Place : Ahmedabad Chirag M. shah

Date : 03/08/2015 Partner

Memb. No. 045706


Mar 31, 2013

The accompanying abridged financial statements,which comprise the abridged Balance Sheet as at 31st March2013, the abridged Statement of Profit and Loss, the abridged Cash Flow statementfor the year ended 31s1 March, 2013 and related notes, are derived from the audited financial statements of Shree Rama Multi-tech Limited (''the company'')for the year ended 31s,March,2013. We expressed an unmodified audit opinion on those financial state- ments in our report dated 28th May,2013.

These abridged financial statements have been prepared by the Company pursuant to Rule 7 A of the Companies (Central Government''s) General Rules and Forms, 1956 and are based on the accounts of the Company for the year ended 31 March, 2013 prepared in accordance with Schedule VI to the Companies Act, 1956 and covered by our report dated 28th May, 2013 to the members of the Company.

The abridged financial statements do not contain all the disclosures required by the Accounting Standards re- ferred to in sub-section(3C) of Section 211 of the Companies Act,1956(''the act'')[applied in the preparation of the audited financial statements of the company]. Reading the abridged financial statements,thereof.is not a substi- tute for reading the audited financial statements of the Company.

Management''s Responsibility for the Abridged Financial Statements

Management is responsible for the preparation of a summary of the audited financial statements,on the basis described in Note 1 [A],

Auditor''s Responsibility

Our responsibility is to express an opinion on the abridged financial statement based on our procedures,which were conducted in accordance with the Standard on Auditing(SA) 810, ''Engagements to report on Summary Financial Statements'' issued by the Institute of Chartered Accountants of India.

Opinion

In our opinion.the abridged financial statements derived from audited financial statements of the company for the year ended 31 March,2013 are a fair summary of those financial statements,on the basis described in Note 1[A] and read with following:

(i) Sub note no. 3(b) in Note no. 28[B] regarding non transfer of unpaid dividend of Rs.100 Lacs on prefer- ence shares for the year 2000-01 to Unpaid Dividend Account in a Scheduled Bank as required under Section 205A of the Act & to Investor Education & Protection fund as per Section 205C of the Act.

(ii) Sub Note no. 4.4 of Note 28[B] regarding Accounting treatment of Waiver of Loans etc. of Rs. 12521.78 lacs.

(iii) Sub Note No. 6 of Note 28[B] regarding non provision of interest on borrowings and Debentures of Rs.1,460.59 Lacs for the current year and Rs. 15,022.95 Lacs unpaid interest for the period up to 31-03- 2012 aggregating to Rs. 16,483.54 Lacs up to 31.3.2013. If the above provision is made in respective years, the Loss for the current year would have been Rs.3,453.65 Lacs and aggregate loss to be carried forward would have been Rs.70,181.33 Lacs

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of Shree Rama Multi-Tech Limited on the accounts of the company for the year ended 31s'' March, 2013.

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

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

(b) The fixed assets are being physically verified by the management during the year according to a phased programme designed to cover all the items over a period of five years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the management during the year and we have been informed that no material discrepancies between the book records and the physical verification have been noticed.

(c) During the year the company has disposed off/discarded/impaired fixed assets having book value Rs.2664.52 lacs, without affecting status of the company as going concern.

ii. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

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

(c) The Company is maintaining proper records of inventory. As informed, there was no material discrepancies noticed on such physical verification as compared to the book records.

lii (a) As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) As informed, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

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 purchase of inventory, fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. According to the information and explanations provided by the management, there has been no contract or arrangement the particulars of which are required to be entered into the register maintained under section 301 of the Companies Act, 1956.

vi. Accordingly to the information and explanations given to us, the Company has not accepted any deposit from the public during the year.

vii. In our opinion, the internal audit function carried out during the year by a firm of Chartered Accountants appointed by the management, has been commensurate with the size and nature of its business.

viii. We have broadly reviewed the books of account maintained by the Company in respect of products where pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records are maintained.

ix. (a) The Company has been generally regular in depositing statutory dues including provident fund, employees'' state insurance, income-tax, VAT, custom duty, excise duty, Service Tax, cess and other material statutory dues with the appropriate authorities except small delays in a few cases.

x. The Company''s accumulated losses at the end of the financial year are more than its net worth. The company has filed application in BIFR for registration as "Sick company" which BIFR has rejected & on Appeal, AAIFR has given decision in favour of the company & matter is pending before BIFR. However, the Company has not incurred cash losses in the current and immediately preceding financial year.

xi. Based on our audit procedures and as per the information and explanations given by the management, the Company has defaulted in repayment of Principle dues of Rs. 10257.80 Lacs & interest thereon aggregating to Rs. 16483.54 Lacs up to 31.03.2013 to lenders.

xii. According to the information and explanations given to us and based on the documents and records produced, 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. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society and therefore, the provisions of clause 4 (xiii) of the Order are not applicable.

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

xv. According to the information and explanations given to us, the Company had given guarantees for loans taken by East West Polyart Limited & Ideal Petro Products Limited from banks and financial institutions in earlier years, terms and conditions whereof based on the management representation and considering the business relationship with this company, were not prima-facie prejudicial to the interest of the Company. Suits for recovery of dues are filed in Debt Recovery Tribunal & Courts against the company being a guarantor. (See Sub Note 2(a) of Note 28B)

xvi. On the basis of the records examined by us and according to information and explanations given to us, no term loans were obtained by the Company during the year under audit.

xvii. According to the information and explanations given to us and on the basis of 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 investments.

xviii.During the year the Company has not made allotment of shares on preferential basis to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. According to the information and explanations given to us, during the year covered by our audit, the company has not issued debentures requiring creation of any security or charge.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed and on the basis of information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of out audit.

For, Mahendra N. Shah & Co.

Chartered Accountants

FRN 105775 W

Place : Ahmedabad Chirag M. shah

Date : 28th May, 2013 Partner

Memb. No. 045706


Mar 31, 2012

The accompanying abridged financial statements, which comprise the abridged Balance Sheet as at 31stMarch2012, the abridged Profit and Loss account, the abridged Cash Flow Statement for the year ended 31s1 March, 2012 and related notes, are derived from the audited financial statements of Shree Rama Multi-tech Limited ('the company')for the year ended 31st March,2012. We expressed an unmodified audit opinion on those financial statements in our report dated 28th May,2012.

These abridged financial statements have been prepared by the Company pursuant to Rule 7A of the Companies (Central Government's) General Rules and Forms, 1956 and are based on the accounts of the Company for the year ended 31st March, 2012 prepared in accordance with Schedule VI to the Companies Act, 1956 and covered by our report dated 28th May, 2012 to the members of the Company.

The abridged financial statements do not contain all the disclosures required by the Accounting Standards referred to in sub-section(3C) of Section 211 of the Companies Act,1956('the act')[applied in the preparation of the audited financial statements of the company]. Reading the abridged financial statements, thereof, is not a substitute for reading the audited financial statements of the Company.

Management's Responsibility for the Abridged Financial Statements

Management is responsible for the preparation of a summary of the audited financial statements, on the basis described in Note 1 [A],

Auditor's Responsibility

Our responsibility is to express an opinion on the abridged financial statement based on our procedures, which were conducted in accordance with the Standard on Auditing(SA) 810, 'Engagements to report on Summary Financial Statements' issued by the Institute of Chartered Accountants of India. -

Opinion

In our opinion, the abridged financial statements derived from audited financial statements of the company for the year ended 31s* March,2012 are a fair summary of those financial statements, on the basis described in Note 1[A] and read with following:

(i) Sub note no. 3(b) in Note no. 1[B] regarding non transfer of unpaid dividend of Rs.100 Lacs on preference shares for the year 2000-01 to Unpaid Dividend Account in a Scheduled Bank as required under Section 205A of the Act & to Investor Education & Protection fund as per Section 205C of the Act.

(ii) Sub Note no. 4.4 of Note 1 [B] regarding Accounting treatment of Waiver of Loans etc. of Rs.5828.14 lacs,

(iii) Sub Note No. 6 of Note 1 [B] regarding non provision of interest on borrowings of Banks, Financial Institution, Debentures of Rs.3816.27 Lacs for the current year and Rs.47963.00 Lacs unpaid interest for the period up to 31 -03-2011 aggregating to Rs. 51779.27 Lacs up to 31.3.2012. If the above provision is made in respective years, the loss for the current year would have been Rs. 3777.05 Lacs and aggregate loss to be carried forward would have been Rs.103484.01 Lacs.

Annexure referred to in paragraph 3 of our report of even date Shree Rama Multi-Tech Limited

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

(b) The fixed assets are being physically verified by the management during the year according to a phased programme designed to cover all the items over a period of five years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the management during the year and we have been informed that no material discrepancies between the book records and the physical verification have been noticed.

(c) There was no substantial disposal of fixed assets during the year.

ii. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

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

(c) The Company is maintaining proper records of inventory. As informed, there was no material discrepancies noticed on such physical verification as compared to the book records.

iii (a) As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered-, in the register maintained under section 301 of the Companies Act, 1956.

(b) As informed, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

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 purchase of inventory, fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. According to the information and explanations provided by the management, there has been no contract or arrangement the particulars of which are required to be entered into the register maintained under section 301 of the Companies Act, 1956.

vi. Accordingly to the information and explanations given to us, the Company has not accepted any deposit from the public during the year.

vii. In our opinion, the internal audit function carried out during the year by a firm ot Chartered Accountants appointed by the management, has been commensurate with the size and nature of its business.

viii. We have broadly reviewed the books of account maintained by the Company in respect of products where pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records are maintained.

ix. (a) The Company has been generally regular in depositing statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, custom duty, excise duty, cess and other material statutory dues with the appropriate authorities except small delays in a few cases.

(b) According to the records of the Company, the dues in respect of Income tax, Excise-duty, Cess on account of any dispute, are as follows:

Nature of Statute Year Amount (Rs.) Forum where dispute is pending

Central Excise (1)1999-00 to 2001-02 3893.72 Lacs CESTAT - Act, 1944 (2)1998-99 293.42 Lacs Gujarat High Court

x. The Company's accumulated losses at the end of the financial year are more than its net worth. The company has filed application in BIFR for registration as "Sick company" which BIFR has rejected & on Appeal, AAIFR has given decision in favour of the company & matte* is pending before BIFR. However, the Company has not incurred cash losses in the current and immediately preceding financial year.

xi. Based on our audit procedures and as per the information and explanations given by the management, the Company has defaulted in repayment of Principle dues of Rs. 28209.20 Lacs & interest thereon aggregating to Rs.51779.00 Lacs up to 31.03.2012 to domestic Financial Institutions, Banks and Debenture Holders.

xii. According to the information and explanations given to us and based on the documents and records produced, 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. In our opinion, the Company is not a chitfund or a nidhi / mutual benefit fund / society and therefore, the provisions of clause 4 (xiii) of the order are not applicable.

xiv: In our opinion, the Company is not dealing or trading in shares, securities and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable.

xv. According to the information and explanations given to us, the Company had given guarantees for loans taken by East West Polyart Limited & Ideal Petro Products Limited from banks and financial institutions in earlier years, terms and conditions whereof based on the management representation and considering the business relationship with this company, were not prima-facie prejudicial to the interest of the Company. Suits for recovery of dues are filed in Debt Recovery Tribunal & Courts against the company being a guarantor. (See Sub Note 1 & 2)

xvi. On the basis of the records examined by us and according to information and explanations given to us, no term loans were obtained by the Company during the year under audit.

xvii. According to the information and explanations given to us and on the basis of 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 investments.

xviii. During the year the Company has pot made allotment of shares on preferential basis to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. According to the information and explanations given to us, during the year covered by our audit, the company has not issued debentures requiring creation of any security or charge.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed and on the basis of information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of out audit.

For, Mahendra N. Shah & Co.

Chartered Accountants

FRN 105775 W

Place : Ahmedabad Chirag M. shah

Date : 28th May, 2012 Partner

Memb. No. 045706


Mar 31, 2011

1. We have audited the attached Balance Sheet of Shree Rama Multi-Tech Limited as at 31st March 2011, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order,2003,(as amended) (hereinafter referred to as "the order") issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956 (hereinafter referred to as "the Act") we enclose in the Annexure statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

(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 with the books.

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

(d) In our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this reportcomply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act.

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

(f) We invite attention to note no. 3(H) in Schedule 21B regarding non transfer of unpaid dividend of Rs. 100 Lacs on preference shares for the year 2000-01 to Unpaid Dividend Account in a Scheduled Bank as required under Section 205A of the Act & to Investor Education & Protection fund as per Section 205C of the Act.

(g) In our opinion and as per the information and according to the explanations given to us, the said Balance Sheet and the Profit and Loss Account subject to :

Note No. 6 of Schedule 21B regarding non provision of interest on borrowings of Banks, Financial Institution, Debenture of Rs.50.54 Crores for the current year and Rs. 429.09 Crores unpaid interest for the period up to 31- 03-2010 aggregating to Rs. 479.63 Crores up to 31.3.2011. If the above provision is made in respective years the loss for the current year would have been Rs. 31.74 Crores and aggregate loss to be carried forward would have been Rs. 997.07 Crores read with significant accounting policies and Notes on Accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fairview in the conformity with the accounting principles generally accepted in India :

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

(ii) in the case of Profit and Loss Account, of the Profit of the Company for the year ended on that date; and

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

Annexure referred to in paragraph 3 of our report of even date Shree Rama Multi-Tech Limited

i. (a) The Company has maintained records showing particulars, including quantitative details and situa- tion of fixed assets.

(b) The fixed assets are being physically verified by the management during the year according to a phased programme designed to cover all the items over a period of five years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the management during the year and we have been informed that no material discrepancies between the book records and the physical verification have been noticed disregarding certain assets in the form of moulds & dies etc. which are treated as integral part of principal Plant & Machinery.

(c) There was no substantial disposal of fixed assets during the year.

ii. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

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

(c) The Company is maintaining proper records of inventory. As informed, there was no material dis- crepancies noticed on such physical verification as compared to the book records.

iii (a) As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) As informed, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

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 purchase of inventory, fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. According to the information and explanations provided by the management, there has been no contract or arrangement the particulars of which are required to be entered into the register maintained under section 301 of the Companies Act, 1956.

vi. Accordingly to the information and explanations given to us, the Company has not accepted any deposit from the public during the year.

vii. In our opinion, the internal audit function carried out during the year by a firm of Chartered Accountants appointed by the management, has been commensurate with the size and nature of its business.

viii. The Central Government has not prescribed the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956, for any of the products of the Company.

ix. (a) The Company has been generally regular in depositing statutory dues including provident fund, em- ployees' state insurance, income-tax, sales-tax, custom duty, excise duty, cess and other material statutory dues with the appropriate authorities except small delays in a few cases.

(b) According to the records of the Company, the dues in respect of Income tax, Excise-duty, Cess on account of any dispute, are as follows:

Nature of Statute Year Amount (Rs.) Forum where dispute is pending

Income tax Act, 1961 2001-02 9,82,28,856 Income-tax Appellate Tribunal

Income tax Act, 1961 1998-99 2,36,12,614 Income-tax Appellate Tribunal

Central Excise Act, 1944 (1)1999-00 to 2001-02 38,93,71,627 Cestat

(2)1998-99 1,61,97,773 Hon'ble Gujarat High Court

x. The Company's accumulated losses at the end of the financial year are more than its net worth. The company has filed application in BIFR for registration as "Sick company" which BIFR has rejected & on Appeal, AAIFR has given decision in favour of the company & matter is pending before BIFR. However, the Company has not incurred cash losses in the current and immediately preceding financial year.

xi. Based on our audit procedures and as per the information and explanations given by the management, the Company has defaulted in repayment of Principle dues of Rs. 369.58 Crores & interest thereon aggregating to Rs.479.63 Crores up to 31.03.2011 to domestic Financial Institutions, Banks and Deben- ture Holders:

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

xiil. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society and therefore, the provisions of clause 4 (xiii) of the Order are not applicable.

xiv. In out opinion, the Company is not dealing or trading in shares, securities and other investments. Ac- cordingly, the provisions of clause 4(xiv) of the Order are not applicable.

xv. According to the information and explanations given to us, the Company had given guarantees for loans taken by East West Polyart Limited & Ideal Petro Products Limited from banks and financial institutions in earlier years, terms and conditions whereof based on the management representation and consider- ing the business relationship with this company, were not prima-facie prejudicial to the interest of the Company. Suits for recovery of dues are filed in Debt Recovery Tribunal & Courts against the company being a guarantor. (See Note 1 & 2 of Schedule 21B)

xvi. On the basis of the records examined by us and according to information and explanations given to us, no term loans were obtained by the Company during the year under audit.

xvii. According to the information and explanations given to us and on the basis of 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 investments.

xviii. During the year the Company has not made allotment of shares on preferential basis to parties and companies covered in trie 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, the company has not issued debentures requiring creation of any security or charge.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed and on the basis of information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of out audit.

For, Mahendra N. Shah & Co.

Chartered Accountants

FRN 105775 W

Place : Ahmedabad Mahendra N. shah

Date : 30/06/2011 Partner

M. No. 003969


Mar 31, 2010

1. We have audited the attached Balance Sheet of Shree Rama Multi-Tech Limited as at 31st March 2010, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order,2003,(as amended) (hereinafter referred to as "the order") issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956 (hereinafter referred to as "the Act") we enclose in the Annexure statement on the matters specified in paragraphs 4 and 5 of the said Order.

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

(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 with the books.

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

(d) In our opinion, the Balance Sheet, the Profit and Loss Account and the 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.

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

(f) We invite attention to note no. 3(ii) in Schedule 21B regarding non transfer of unpaid dividend of Rs.100 Lacs on preference shares for the year 2000-01 to Unpaid Dividend Account in a Schedule Bank as required under Section 205A of the Act & to Investor Education & Protection fund as per Section 205C of the Act.

(g) In our opinion and as per the information and according to the explanations given to us, the said Balance Sheet and the Profit and Loss Account subject to :

Note No. 7 of Schedule 21B regarding non provision of interest on borrowings of Banks, Financial Institution, Debenture of Rs.52.78 Crores for the current year and Rs. 376.31 Crores unpaid interest for the period up to 31-03-2009 aggregating to Rs. 429.09 Crores. If the above provision is made in respective years the Profit for the current year would have been Rs. 9.36 Crores and aggregate loss to be carried forward would have been Rs. 965.34 Crores read with significant accounting policies and Notes on Accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in the conformity with the accounting principles generally accepted in India :

(i) in the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2010; and

(ii) in the case of Profit and Loss Account, of the Profit of the Company for the year ended on that date; and

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

Annexure referred to in paragraph 3 of our report of even date Shree Rama Multi-Tech Limited

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

(b) The fixed assets are being physically verified by the management during the year according to a phased programme designed to cover all the items over a period of five years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the management during the year and we have been informed that no material discrepancies between the book records and the physical verification have been noticed.

(c) There was no substantial disposal of fixed assets during the year.

ii. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

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

(c) The Company is maintaining proper records of inventory. As informed, there was no material discrepancies noticed on such physical verification as compared to the book record.

iii. (a) As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) As informed, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

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 purchase of inventory, fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. According to the information and explanations provided by the management, there has been no contract or arrangement the particulars of which are required to be entered into the register maintained under section 301 of the Companies Act, 1956.

vi. Accordingly to the information and explanations given to us, the Company has not accepted any deposit from the public during the year.

vii. In our opinion, the internal audit function carried out during the year by a firm Chartered Accountants appointed by the management has been commensurate with the size and nature of its business.

viii. The Central Government has not prescribed the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956, for any of the products of the Company.

ix. (a) The Company has been generally regular in depositing statutory dues including provident fund, employees state insurance, income-tax, sales-tax, custom duty, excise duty, cess and other material statutory dues with the appropriate authorities except small delays in a few cases.

(b) According to the records of the Company, the dues in respect of Income tax, Excise-duty, Cess on account of any dispute, are as follows:

Nature of Statute Year Amount (Rs.) Forum where dispute is pending

Income tax Act, 1961 2001-02 9,82,28,856 Commissioner of Income tax (Appeals)

Income tax Act, 1961 2003-04 2,89,39,072 Commissioner of Income tax (Appeals)

Income tax Act, 1961 2004-05 1,77,74,855 Commissioner of Income tax (Appeals)

Income tax Act, 1961 1998-99 2,36,12,614 Income-tax Appellate Tribunal

Central Excise Act, 1944 (1)1999-00 to 2001-02 38,93,71,627 Cestat

(2) 2004-05 2,62,89,446 Cestat

(3) 1996-97 45,29,302 Honble Gujarat High Court

(4) 2006-07& 2007-08 25,90,786 Honble Gujarat High Court (5)1998-99 1,61,97,773 Honble Gujarat High Court

x. The Companys accumulated losses at the end of the financial year are more than its net worth. The company has filed application in BIFR for registration as "Sick company" which BIFFt has rejected & on Appeal, AAIFR has given decision in favour of the company & matter is pending before BIFR. However, the Company has not incurred cash losses in the current and immediately preceding financial year.

xi. Based on our audit procedures and as per the information and explanations given by the management, the Company has defaulted in repayment of Principle dues of Rs. 377.91 Crores & interest thereon of Rs.429.09 Crores up to 31.03.2010 to domestic Financial Institutions, Banks and Debenture Holders.

xii. According to the information and explanations given to us and based on the documents and records produced, 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. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society and therefore, the provisions of clause 4 (xiii) of the Order are not applicable.

xiv. In out opinion, the Company is not dealing or trading in shares, securities and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable.

xv. According to the information and explanations given to us, the Company had given guarantees for loans taken by East West Polyart Limited & Ideal Petro Products Limited from banks and financial institutions in earlier years, terms and conditions whereof based on the management representation and considering the business relationship with this company, were not prima-facie prejudicial to the interest of the Company. Suits for recovery of dues are filed in Debt Recovery Tribunal & Courts against the company being a guarantor. (See Note 1 & 2 of Schedule 21B)

xvi. On the basis of the records examined by us and according to information and explanations given to us, no term loans were obtained by the Company during the year under audit.

xvii. According to the information and explanations given to us and on the basis of 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 investments.

xviii. During the year the Company has not made allotment of shares on preferential basis to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. According to the information and explanations given to us, during the year covered by our audit, the company has not issued debentures requiring creation of any security or charge.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed and on the basis of information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of out audit.

For, Mahendra N. Shah & Co.

Chartered Accountants

FRN 105775 W

Place : Ahmedabad Mahendra N. shah

Date : 29/06/2010 Partner M. No. 003969

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