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Auditor Report of Shree Renuka Sugars Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of SHREE RENUKA SUGARS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2015, and the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

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

Auditors' 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. 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.

Opinion

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

Emphasis of Matter

1) We draw attention to Note 5 to the financial statements in respect of the provision of Deferred Tax Asset on unabsorbed business losses wherein the Company represents that there is virtual certainty of future taxable profits that will be available for setting of such unabsorbed business losses. We have relied on such representation and our Opinion is not qualified in respect of this matter.

2) Without qualifying our opinion, we draw attention to the recoverable amount of the Investment made by the Company in its subsidiary company Shree Renuka Global Ventures Ltd., Mauritius. This investment is stated at its carrying amount of Rs. 18,219 Mn., as the fair value of Investment made by this subsidiary company in the step down subsidiary company Shree Renuka do Brasil Participators Ltda. , cannot be reliably measured. The management has assessed the recoverable amount of this investment and confirm that the carrying amount of this investment has not suffered any impairment in value.

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 in terms of sub-section (11) of section 143 of the Act, we give in the Annexure 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 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 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act;

f. With respect to the other matters to be included in the Auditors' 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 have disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 32(v) 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Annexure to the Auditors' Report

The Annexure referred to in our report to the members of Shree Renuka Sugars Limited for the year ended March 31, 2015. We report that:

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

b) As explained to us, all fixed assets have been physically verified by the management during the year periodically which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification

ii) a) With regard to inventory, physical verification has been conducted by the management at reasonable intervals.

b) In our opinion, the procedure of physical verification of stocks followed by the management is reasonable and is adequate in relation to the size of the Company and nature of its business.

c) The Company is maintaining proper records of inventory. No significant material discrepancies were noticed on the physical verification of stocks and the differences between the book stocks and the physical stocks have been properly dealt with in the books of account.

iii) In respect of the loans, secured or unsecured granted by the Company to companies, forms or other parties covered in the register maintained under section 189 of the Companies Act, 2013:

a) The Company has given loans to Ten Subsidiary companies. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 2,812.59 Millions and the yearend balance is Rs. 1,974.55 Millions.

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

c) The principal amount is repayable on demand and there is no repayment schedule. The company is regular in receipt of interest from these subsidiaries except from two wholly owned Subsidiaries.

d) In respect of the said loans, the same is repayable on demand and therefore the question of overdue amount does not arise. In respect of interest, there is no overdue amount except in case of two wholly owned Subsidiaries whose Overdue Interest is Rs. 117.06 Million.

iv) On the basis of checks carried out during the course of audit and as per the explanations given to us, we are of the opinion that with regard to purchase of inventory and fixed assets and for the sale of goods and services, there is an adequate internal control system commensurate with the size of the Company and nature of its business. In our opinion there is no continuing failure to correct major weaknesses in internal control system.

v) According to the information and explanations given to us, the company has not accepted any deposits, hence reporting on clause (v) of the order is not applicable.

vi) The Central Government has prescribed maintenance of cost records u/s. 148(1) of the Companies Act, 2013 for some products of the Company. We have broadly reviewed these records of the company and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not carried out a detailed examination of such records.

vii) a) According to the information and explanations given to us and as per books and records examined by us, there are no undisputed amounts payable in respect of Provident Fund, Employees' State Insurance, Income tax, Sales tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Cess, Investor Education and Protection Fund and any other statutory dues with appropriate authorities outstanding as at 31st March 2015 for a period exceeding six months from the date they became payable.

b) According to the information and explanations given to us and as per the records examined by us, the disputed statutory dues aggregating to Rs. 739.69 Million that have not been deposited on account of disputed matters pending before appropriate authorities are as under:

Sl Name of the Statute Nature of Amount No Dues (Rs,in Mn)

1 Maharashtra Value Added VAT credit/CST 8.05 Tax/CST

2 Central Excise Act 1944 Excise Duty 9.95

344.13

3.73

3.65

3 Finance Act 1994 Service Tax 3.76

16.10

4 Custom Act 1962 Custom Duty 249.03

5 Income Tax Act 1961 Income Tax 101.29

Grand Total 739.69



Name of the Statue Period Forum where Dispute is pending

Maharashtra 2007-08 & 2008- Maharashtra Value added tax Value Added 09 appeal Kolhapur Taqx/CST

Cetral Excise Act 1944 April 2008 to Commissioner of Central Excise Sept. 2012 Appeal

Various Years CESTAT (2004-2012)

May 2008 to Bombay High Court June 2010

Supreme Court of India

finance act 1944 July 2005 to Commissioner of Central Excise Sept. 2011 Appeal

April 2009 to CESTAT April 2011

custom act 1962 2004 Supreme Court of India

Income Tax Act 1961 2008-09 & 2009- Commission of Income Tax 10 viii) The Company has accumulated losses at the end of financial year but such loss has not exceeded in excess of 50% of its Net Worth. The Company has incurred cash loss for the financial year of the reporting period and also for the immediate preceding financial year.

ix) The Company has borrowed funds from banks, financial institutions and also has raised funds by way of debentures. There is no default in repayment of dues to banks, financial institutions and debenture holders.

x) The Company has given guarantees for loans taken by others from banks or financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interests of the company.

xi) The term loans borrowed during the year have been utilized for the purposes for which they were raised.

xii) As per information and explanations given to us and on the basis of our examinations of books and records, there were no frauds on or by the company has been noticed or reported during the year.

For Ashok Kumar, Prabhashankar & Co.,

Chartered Accountants

Firm Regn No. 004982S



K. N. Prabhashankar

Place: Mumbai Partner

Date: May 21, 2015 Membership No. 019575


Mar 31, 2014

We have audited the accompanying financial statements of SHREE RENUKA SUGARS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and the Statement of profit and Loss and Cash Flow Statement for the year then ended, and a summary of signifcant 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 subsection (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes 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 misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We 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 sufcient 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 afairs of the Company as at March 31, 2014;

(b) In the case of the Statement of profit and Loss, of the loss 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.

Emphasis of Matter

We draw attention to Note 5 to the financial statements in respect of the provision of Deferred Tax Asset on unabsorbed business losses wherein the Company represents that there is virtual certainty of future taxable profits that will be available for setting of such unabsorbed business losses. We have relied on such representation and our Opinion is not qualifed in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specifed 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 is 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 Companies Act, 1956;

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

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

Annexure To The Auditors'' Report The Annexure referred to in our report to the members of Shree Renuka Sugars Limited for the year ended March 31, 2014. We report that:

1. a. The Company has maintained proper records showing full

particulars including quantitative details and situation of fixed assets on the basis of available information.

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

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

2. a. As explained to us, inventories have been physically

verifed by the management at regular intervals.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verifcation of inventories followed by the management is reasonable and is adequate in relation to the size of the Company and 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 verifcation of inventory as compared to the book records.

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

a. The company has not taken any loans during the year.

b. The Company has given loans to Ten Subsidiary companies. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs.2,557.92 Millions and the year end balance is Rs.1,228.21 Millions.

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

d. The principal amount is repayable on demand and there is no repayment schedule. The company is regular in receipt of interest from these subsidiaries except one wholly owned Subsidiary.

e. In respect of the said loans, the same is repayable on demand and therefore the question of overdue amount does not arise. In respect of interest, there is no overdue amount except in case of one wholly owned Subsidiary whose Overdue Interest is Rs. 69.92 Million.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and nature of its business for the purchase of inventory, 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 weaknesses in internal control.

5. a. In our opinion and according to the information and

explanations given to us, the transactions made in pursuance contracts or arrangements, that needed to be entered in the register, maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us where such transaction is in excess of Rs.5 lacs, the transaction has been made at prices which is prima facie reasonable having regard to the prevailing market prices at the relevant time and they are not prejudicial in the interest of the Company.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public within the meaning of provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under. Hence clause (vi) of the order is not applicable.

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

8. The Central Government has prescribed maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for some products of the company. We have broadly reviewed these records of the company and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not carried out a detailed examination of such records.

9. a. According to the information and explanation given to us

and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including ESI, Provident Fund, Income-tax, Sales tax/Value Added Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess, Investor Education and Protection Fund and any other statutory dues with the appropriate authorities and there are no such dues which are outstanding for a period in excess of six months as on March 31, 2014.

b. The disputed statutory dues aggregating to Rs.656.40 Million that have not been deposited on account of disputed matters pending before appropriate authorities are as under:

Name of the Nature of Amount Period Forum where Statute Dues (Rs.in Mn) to which Dispute is the amount pending relates

Karnataka Purchase 8.28 2006-07 Sales Tax Sales Tax Tax & 2007- 08 Tribunal Act,1957

9.88 2006-07 High Court & 2007-08 Central Excise 335.63 Various Central Excise Excise Act,1944 Duty and Years and Service Service (2004- Tax Appellate Tax 2012) Tribunal

2.59 2005- Commissioner 2009 of Central Excise

Customs Customs 249.03 2004 Supreme Court Act1962 Duty

Income Tax Income 50.99 2008-09 Income Tax Act, 1961 Tax Appellate Tribunal

Total 656.40

10. The Company has accumulated losses and has also incurred cash losses during the financial year covered by our audit but has not incurred cash losses in the immediately preceding f- nancial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions or banks or debentureholders.

12. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order 2003 are not applicable to the Company.

14. The Company is trading in shares, securities and other investments. In our opinion, proper records have been maintained of the transactions and contracts entered by the Company and timely entries have been made therein. These investments are held by the Company in its own name.

15. The Company has given guarantees for loans taken by others from banks or financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interests of the company.

16. The term loans borrowed during the year have been utilised for the purposes for which they were raised.

17. According to the information and explanation given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that there are no funds raised on short- term basis that have been used for long-term investment.

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

b. As the Company has not made any preferential allotment of shares, the question of commenting of the terms of such issue does not arise.

19. During the year covered by our Audit Report,the Company has not issued Redeemable Non-Convertible Debentures.

20. The company has not raised any money by way of public issues during the year.

21. In our opinion and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year that causes the financial statements to be materially misstated.

for Ashok Kumar, Prabhashankar & Co. Chartered Accountants Firm Regn No. 004982S

K. N. Prabhashankar Camp: Mumbai Partner Date: May 23, 2014 Membership No. 19575


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of SHREE RENUKA SUGARS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the Accounting standards referred to in subsection (3C) of Section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes 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 misstatement, whether due to fraud or error.

Auditors'' Responsibility

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

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

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

Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (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 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 is 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 Companies Act, 1956;

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

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

The Annexure referred to in our report to the members of Shree Renuka Sugars Limited for the year ended March 31, 2013. We report that:

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

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

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

2. a. As explained to us, inventories have been physically verified by the management at regular intervals.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management is reasonable and is adequate in relation to the size of the Company and 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 inventory as compared to the book records.

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

a. The company has not taken any loans during the year.

b. The Company has given loans to Nine Subsidiary companies. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs.3,095.51 Millions and theyearend balance is Rs.1,953.33 Millions.

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

d. The principal amount is repayable on demand and there is no repayment schedule.The company is regular in payment and receipt of interest.

e. In respect of the said loan, the same is repayable on demand and therefore the question of overdue amount does notarise. In respect of interest there is no overdue amount.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and nature of its business for the purchase of inventory, 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 weaknesses in internal control.

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

b. In our opinion and according to the information and explanations given to us where such transaction is in excess of Rs.5 lacs, the transaction has been made at prices which is prima facie reasonable having regard to the prevailing market prices at the relevant time and they are not prejudicial in the interest of the Company.

6 According to the information and explanations given to us, the company has not accepted any deposits from the public within the meaning of provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under. Hence clause (vi) of the order is not applicable.

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

8. The Central Government has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for some products of the company. We have broadly reviewed these records of the company and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not carried out a detailed examination of such records.

9. a. According to the records of the Company and as per the information and explanations given to us, the Company does not have any undisputed statutory dues including ESI, Provident Fund, Income-tax, Sales tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues which are outstanding for a period in excess of six months as on March 31, 2013. The Company did not have any dues on account of Investor Education and Protection Fund.

10. The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion thatthe Company has notdefaulted in repayment of dues to financial institutions or banks or debentureholders.

12. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors''Report) Order 2003 are not applicable to the Company.

14. The Company is trading in shares, securities and other investments. In our opinion proper records have been maintained of the transactions and contracts entered by the Company and timely entries have been made therein. These investments are held by the Company in its own name.

15. The Company has given guarantees for loans taken by others from banks or financial institutions. According to the information and explanations given to us, we are of the opinion thatthe terms and conditions thereof are not prima facie prejudicial to the interests of the company.

16. The term loans borrowed during the year have been utilised for the purposes for which they were raised.

17. According to the information and explanation given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that there are no funds raised on short-term basis that have been used for long- term investment.

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

b. As the Company has not made any preferential allotment of shares, the question of commenting of the terms of such issue does not arise.

19. During the year covered by our Audit Report, the Company has issued Redeemable Non-Convertible Debentures. As per the information and explanations given to us, the Company has created security in respect of such Debentures issued.

20. The company has not raised any money by way of public issues during the year.

21. In our opinion and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year that causes the financial statements to be materially misstated.

For Ashok Kumar, Prabhashankar & Co.,

Chartered Accountants Firm Regn No.004982S

K. N. Prabhashankar

Camp: Mumbai Partner

Date: May 29,2013 Membership No. 19575


Mar 31, 2012

We have audited the Balance Sheet of SHREE RENUKA SUGARS LIMITED as at March 31, 2012, the Profit and Loss Account and Cash Flow Statement for the 18 Months period ended as on that date both 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.

1. 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 mis-statement. 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by The Companies (Auditor's Report) Order 2003, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

3. Further to our comments in the Annexure referred to in paragraph 2 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 it appears from our examination of those 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 and Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the mandatory Accounting Standards referred in sub-section (3C) of Section 211 of the Companies Act, 1956;

e) In our opinion, and based on information and explanations given to us, none of the directors are disqualified as on March 31, 2012 from being appointed as directors in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956 in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in so far as it relates to the Balance Sheet of the state of affairs of the Company as at March 31, 2012.

(ii) in so far as it relates to the Profit and Loss Account of the Profit of the Company for the 18 months period ended on that date; and

(iii) in so far as it relates to the Cash Flow Statement, of the cash flows of the Company for the 18 months ended on that date.

ANNEXURE TO AUDITORS' REPORT REFERRED TO IN PARAGRAPH 2 OF OUR REPORT OF EVEN DATE

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

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

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

2. a. As explained to us, inventories have been physically verified by the management at regular intervals.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management is reasonable and is adequate in relation to the size of the Company and 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 inventory as compared to the book records.

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

a. The company has not taken any loans during the period.

b. The Company has given loans to Seven Subsidiary companies. In respect of the said loan, the maximum amount outstanding at any time during the period was Rs 3,913.62 million and the period end balance is Rs 982.80 million.

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

d. The principal amount is repayable on demand and there is no repayment schedule. The company is regular in payment and receipt of interest.

e. In respect of the said loan, the same is repayable on demand and therefore the question of overdue amount does not arise. In respect of interest there is no over due amount.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and nature of its business for the purchase of inventory, 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 weaknesses in internal control.

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

b. In our opinion and according to the information and explanations given to us where such transaction is in excess of Rs 5 lacs, the transaction has been made at prices which is prima facie reasonable having regard to the prevailing market prices at the relevant time and they are not prejudicial in the interest of the Company.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public within the meaning of provisions of Section 58A and 58AA of the Companies Act 1956 and the rules framed thereunder. Hence clause (vi) of the order is not applicable.

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

8. The Central Government has prescribed maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for some products of the company. We have broadly reviewed these records of the company and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not carried out a detailed examination of such records.

9. a. According to the records of the Company and as per the information and explanations given to us, the Company does not have any undisputed statutory dues including ESI, Provident Fund, Income-tax, Sates tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues which are outstanding for a period in excess of six months as on March 31, 2012.The Company is not having Investor Education and Protection Fund.

b. According to the information and explanations given to us and as per the records examined by us, there were no disputed amounts due in respect of Sales Tax, Income Tax, Customs Duty, Service Tax, Wealth Tax, Excise Duty and Cess as on March 31, 2012.

10. The Company has no accumulated losses and has not incurred any cash losses during the financial period covered by our audit or in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions or banks or debentureholders.

12. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order 2003 are not applicable to the Company.

14. The Company is trading in shares, securities and other investments. In our opinion proper records have been maintained of the transactions and contracts entered by the Company and timely entries have been made therein. These investments are held by the Company in its own name.

15. The Company has given guarantees for loans taken by others from banks or financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interests of the Company.

16. The term loans borrowed during the period have been utilised for the purposes for which they were raised.

17. According to the information and explanation given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that there are no funds raised on short-term basis that have been used for long-term investment.

18. a. The Company has made preferential allotment of shares to companies/parties covered in the register maintained under Section 301 of the Companies Act, 1956 by way of ESOP.

b. The terms of such issue is not prejudicial to the interest of the Company.

19. During the period covered by our Audit Report, the Company has issued Redeemable Non-Convertible Debentures. As per the information and explanations given to us, the Company has created security in respect of such Debentures issued.

20. The company has not raised any money by way of public issues during the period.

21. In our opinion and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the period that causes the financial statements to be materially misstated.

For Ashok Kumar, Prabhashankar & Co.,

Chartered Accountants

Firm Regn No.004982S

K. N. Prabhashankar

Place: Mumbai Partner

Date: May 29, 2012 Membership No. 19575


Sep 30, 2010

We have audited the Balance Sheet of SHREE RENUKA SUGARS LTD as at September 30, 2010, the profit and Loss Account and Cash Flow Statement for the year ended as on that date both 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.

1. 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 mis-statement. 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

3. Further to our comments in the Annexure referred to in paragraph 2 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 it appears from our examination of those 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 and profit and Loss Account and Cash Flow Statement dealt with by this report comply with the mandatory Accounting Standards referred in sub-section (3C) of section 211 of the Companies Act, 1956;

e) In our opinion, and based on information and explanations given to us, none of the directors are disqualifed as on September 30, 2010 from being appointed as directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956 in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India:

(i) In so far as it relates to the Balance Sheet of the state of affairs of the Company as at September 30, 2010.

(ii) In so far as it relates to the profit and Loss Account of the profit of the Company for the year ended on that date; and

(iii) In so far as it relates to the Cash Flow Statement, of the cash fows of the Company for the year ended on that date.

Annexure to Auditors Report Referred to in Paragraph 2 of our report of even date

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

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

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

2. a. As explained to us, inventories have been physically verifed by the management at regular intervals.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verifcation of inventories followed by the management is reasonable and is adequate in relation to the size of the Company and 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 verifcation of inventory as compared to the book records.

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

a. The company has not taken any loans during the year.

b. The Company has given loans to four subsidiary companies. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 1,169.67 Million and the year- end balance is Rs. 927.86 Million.

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

d. The principal amount is repayable on demand and there is no repayment schedule. The company is regular in payment and receipt of interest.

e. In respect of the said loan, the same is repayable on demand and therefore the question of overdue amount does not arise. In respect of interest there is no over due amount.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and nature of its business for the purchase of inventory, 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 weaknesses in internal control.

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

b. In our opinion and according to the information and explanations given to us where such transaction is in excess of Rs. 5 Lakhs, the transaction has been made at prices which is prima facie reasonable having regard to the prevailing market prices at the relevant time and they are not prejudicial in the interest of the Company.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public within the meaning of provisions of Section 58A and 58AA of the Companies Act, 1956 and the rules framed thereunder. Hence clause (vi) of the order is not applicable.

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

8. The Central Government has prescribed maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for some products of the company. We have broadly reviewed these records of the company and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not carried out a detailed examination of such records.

9. a. According to the records of the Company and as per the information and explanations given to us, the Company does not have any undisputed statutory dues including ESI, Provident Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues which are outstanding for a period in excess of six months as on September 30, 2010.The Company is not having Investor Education and Protection Fund.

b. According to the information and explanations given to us and as per the records examined by us, there were no disputed amounts due in respect of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty and Cess as on September 30, 2010.

10. The Company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions or banks or debenture holders.

12. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order 2003 are not applicable to the Company.

14. The Company is trading in shares, securities and other investments. In our opinion proper records have been maintained of the transactions and contracts entered by the Company and timely entries have been made therein. These investments are held by the Company in its own name.

15. The Company has given guarantees for loans taken by others from banks or financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interests of the company.

16. The term loans borrowed during the year have been utilised for the purposes for which they were raised.

17. According to the information and explanation given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that there are no funds raised on short-term basis that have been used for long-term investment.

18. a. The Company has made preferential allotment of shares to companies/parties covered in the register maintained under section 301 of the Companies Act, 1956.

b. As per the information and explanations given to us the price at which such preferential allotment of shares made is not prejudicial to the interest of the Company.

19. During the year covered by our Audit Report, the Company has not issued any Debentures.

20. The company has not raised any money by way of public issues during the year.

21. In our opinion and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year that causes the financial statements to be materially mis-stated.

For Ashok Kumar, Prabhashankar & Co. Chartered Accountants

Firm Regn No. 004982S

K. N. Prabhashankar Partner Membership No. 19575

Place: Mumbai Date : February 11, 2011

 
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