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Auditor Report of Shri Lakshmi Cotsyn Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Shri Lakshmi Cotsyn Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss for the year and statement of cash flow for the year ended 31st March, 2015, and a summary of the significant accounting policies and other explanatory information.

Management'sResponsibility for theFinancial 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 thereunder.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, 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.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit/loss and its cash flow 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 paragraphs 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 statement of cash flow 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 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 26 in 'Other Notes'.

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 which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure to the Independent Auditors' Report

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:

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

fixed assets.

b. 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 three 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.

2. a. As explained to us, the inventories were physically verified during the year by the Management at reasonable

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 were reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

3. The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013.

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

5. The Company has not accepted any deposits from the public.

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

7. a. According to the information and explanations given to us, certain undisputed amounts payable in respect of provident fund, employees' state insurance, income tax and cess were in arrears as at 31 March 2015 for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us, there are dues of income tax for A.Y. 2012-13 amounting to Rs. 42,83,740/- against which the appeal is pending before the DCIT of ITO-6, Kanpur which have not been deposited with the appropriate authorities. Other than the above, no dues are pending against which any dispute is pending as on 31-03-2015.

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

8. The accumulated losses at the end of the financial year exceed fifty percent of the networth of the company. The company has further incurred cash losses during the year under consideration and also in the year immediately precedingthe financial year.

9. The Company has outstanding dues to financial institutions, banks and others during the year. However, as the company has opted for CDR mechanism as per letter of approval dated 28th June, 2013 and Master Restructuring Agreement (MRA) signed on 29th June, 2013 the outstanding dues have been restructured.

10. 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.

11. As per the information and explanations given by the management, the Company has applied the term loan for the purpose for which the loan amount was granted. year.

12. 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 PRADEEP & ASSOCIATES

Chartered Accountants

(Firm Registration No. 001254C)

P. K. GUPTA Date : 05.09.2015 Partner

Place : Kanpur Membership No. 070492


Mar 31, 2014

We have audited the accompanying financial statements of M/s Shri Lakshmi Cotsyn Ltd. which comprise the Balance Sheet as at 31st March 2014, and the Statement of Profit and Loss and Cash Flow Statement for the nine months period then ended, and a summary of significant accounting policies and other explanatory information.

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 clause (2) of section 2 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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.

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 31st March 2014

b) in the case of the Statement of Profit and Loss Account, 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.

1.As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of section 143 of the Companies Act, 2013, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 143 of the Companies Act, 2013, we report that:

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

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in clause (2) of section 2 of the Companies Act, 2013;

e) On the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of section 164 of the Companies Act, 2013.

f) Since the Central Government has not notified the date at which the cess is to be paid under Section 269 of the Companies Act 2013, for the purpose of rehabilitation or revival or protection of assets of the Sick Industrial Company, nor has issued any rules prescribing the manner in which such cess is to be paid, Hence no cess is due and payable by the Company.

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of Shri Lakshmi Cotsyn Limited. On the accounts of the company for the nine months financial year ended on 31st March 2014.

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:

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

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

(c) In our opinion and according to the information and explanations given to us, no fixed asset has been disposed during the year and therefore does not affect the going concern assumption.

2. (a) As explained to us, inventories have been physically verified during the year by the management at reasonable 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 are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) In our opinion and on the basis of our examination of the records, the Company is generally maintaining proper records of its inventories. No material discrepancy was noticed on physical verification of stocks by the management as compared to book records.

3. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted loans, secured or unsecured, to companies firms or other parties listed in the register maintained under section 189 of the Companies Act, 2013. Consequently, the provisions of clauses iii (b), iii(c) and iii (d) of the order are not applicable to the Company.

(e) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not taken loans from companies, firms or other parties listed in the register maintained under section 189 of the Companies Act, 2013. Thus sub clauses (f) & (g) are not applicable to the company.

4. In our opinion and according to the information and explanations given to us, there is generally an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventories & fixed assets and payment for expenses & for sale of

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, there are no contracts or arrangements referred to in section 189 of the Companies Act, 2013

b) This Clause is not applicable as stated above.

6. The Company has not accepted any deposits from the public covered under section section 73 of the Companies Act, 2013

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

8. As per information & explanation given by the management, maintenance of cost records has been prescribed by the Central Government under section 128 of the Companies Act, 2013and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) According to the records of the company, undisputed statutory dues including Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, cess to the extent applicable and any other statutory dues have been regularly deposited with the appropriate authorities except Provident Fund & Employees'' State Insurance, TDS, work contact tax etc According to the information and explanations given to us there were outstanding statutory dues of Provident Fund & Employees'' State Insurance as on 31st March 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there is no amounts payable in respect of income tax, wealth tax, service tax, sales tax, customs duty and excise duty which have not been deposited on account of any disputes.

10. In our opinion, the Company''s accumulated losses at the end of the financial year are in excess of fifty percent of its net worth. The Company has net loss of Rs. 624.15 Crores and has incurred cash loss of Rs. 545.68 Crores during the financial year covered by our audit. Thus the net worth of the company has been completely eroded and the company is required to make necessary reference to BIFR in accordance with the provisions of Section 15(1) of Sick Industrial Companies ( Special Provisions) Act 1985 ( SICA).

11. Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that, the Company has not defaulted in repayment of dues to banks and other Financial Institution except the dues of IFCI amounting to Rs. 6.68 crores and of FCCB worth USD 2.80 Mn for which IFCI has filed a recovery suit at Hon''able DEBT Recovery Tribunal (DRT) Delhi and Bond Holders have filed winding up petition at Allahabad High Court.

12. Due to the liquidity crunch, the Company had opted Corporate Debt Restructuring Mechanism envisaged under RBI guidelines & the CDR package of the Company was approved by the CDR cell vide Letter of Approval (LOA) dated 28th June 2013 and Master Restructuring Agreement (MRA) was signed on 29th June 2013. The CDR package is under implementation.

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

14. The Company is not a chit fund or a nidhi /mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 (as amended) is not applicable to the Company.

15. According to information and explanations given to us, the Company has made investment in Shares. Proper records & timely entries have been maintained in this regard & investments specified are held in their own name.

16. According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution.

17. Based on our audit procedures and on the information given by the management, we report that the company, in compliance of terms of LOA issued by CDR Cell, has raised Rs. 93.90 crore as unsecured loan from its Business Associates towards promoters contribution which was to be converted into equity subject to the approval of BSE/NSE during the year.

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

19. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year.

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

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

For Pradeep & Associates. Chartered Accountants FRN: 001254C

Sd/- CA. P.K. Gupta (FCA) Place: Kanpur (Partner) Date: 30.05.2014 Membership No. :070492


Jun 30, 2013

We have audited the accompanying financial statements of M/s Shri Lakshmi Cotsyn Ltd. which comprise the Balance Sheet as at 30th June, 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 explana- tory information.

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

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in ac- cordance 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 per- form the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evi- dence 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 consid- ers 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 account- ing 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 suf- ficient and appropriate to provide a basis for our audit 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 af- fairs of the Company as at June 30, 2013;

b) in the case of the Profit and Loss Account, 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.

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 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 explana- tions which to the best of our knowledge and belief were necessary for the purpose of our audit.

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

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

d) In our opinion, the Balance Sheet, Statement of Prof- it 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 is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

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

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

1. (a) The company has maintained proper records showing full particulars including quantitative details and situa- tion of its fixed assets.

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

(c) In our opinion and according to the information and explanations given to us, no fixed asset has been dis- posed during the year and therefore does not affect the going concern assumption.

2. (a) As explained to us, inventories have been physically verified during the year by the management at rea- sonable 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 manage- ment are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) In our opinion and on the basis of our examination of the records, the Company is generally maintaining proper records of its inventories. No material discrep- ancy was noticed on physical verification of stocks by the management as compared to book records.

3. (a) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not granted loans, se- cured or unsecured, to companies firms or other par- ties listed in the register maintained under Section 301 of the Companies Act, 1956. Consequently, the provisions of clauses iii (b), iii(c) and iii (d) of the order are not applicable to the Company.

(e) According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not taken loans from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Thus sub clauses (f) & (g) are not applicable to the company.

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

5. a) Based on the audit procedures applied by us and ac- cording to the information and explanations provided by the management, there are no contracts or ar- rangements referred to in section 301 of the Act.

b) This Clause is not applicable as stated above.

6. The Company has not accepted any deposits from the public covered under section 58A and 58AA of the Com- panies Act, 1956.

7. As per information & explanations given by the manage- ment, the Company has an internal audit system com- mensurate with its size and the nature of its business.

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

9. (a) According to the records of the company, undisput- statutory dues including Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, cess to the extent applicable and any other statutory dues have been regularly deposited with the appropriate authori- ties except Provident Fund & Employees'' State Insur- ance. According to the information and explanations given to us there were outstanding statutory dues of Provident Fund & Employees'' State Insurance as on 30th June, 2013 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there is no amounts payable in respect of in- come tax, wealth tax, service tax, sales tax, customs duty and excise duty which have not been deposited on account of any disputes.

10. The Company has accumulated loss of Rs. 40862.37 Lakhs and has incurred cash loss of Rs. 25987.80 Lakhs during the financial year covered by our audit.

11. Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that, the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders except the payment of FCCB worth USD 2.80Mn.

12. As without Qualifying in our opinion, the attention is invited to the stakeholders that the company due to the liquidity crunch has opted Corporate Debt Restructuring Mechanism envisaged under RBI guidelines & has made reference to CDR cell in February 2013. The CDR package of the Company was approved by the CDR cell vide Letter of Approval (LOA) dated 28th June 2013 and Master Restructuring Agreement (MRA) was signed on 29th June 2013 by the 18 Joint lender Banks out of 20 Bankers. The rest Bankers have signed after 30th June 2013.The CDR package is under implementation.

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

14. The Company is not a chit fund or a nidhi /mutual benefit fund/society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 (as amended) is not applicable to the Company.

15. According to information and explanations given to us, the Company is not trading in Shares, Mutual funds & other Investments. Proper records & timely entries have been maintained in this regard & further investments specified are held in their own name.

16. According to the information and explanations given to us, the Company has not given any guarantees for loan taken by others from a bank or financial institution.

17. Based on our audit procedures and on the information given by the management, we report that the company has raised term loans during the year. Besides, the External Commercial Borrowings (ECB) to the tune of USD 5.00 Mn was raised from UCO Bank and the proceeds thereof was utilised for the redemption of FCCBs worth USD 5.00 Mn held by UCO Bank itself.

18. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 30th June 2013, we report that no funds raised on short-term basis have been used for long-term investment by the Company.

19. Based on the audit procedures performed and the infor- mation and explanations given to us by the management, we report that the Company has not made any preferential allotment of shares during the year. However the Com- pany has converted its existing FCCB amounting to USD 1 Million into equity shares.

20. During the year, the Company has issued Non- Convertible Debentures (NCDs) worth Rs. 40 crores to Central Bank of India.

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

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

For PRADEEP & ASSOCIATES

Chartered Accountants

FRN:001254C

CA. P.K. Gupta

Place: Kanpur Partner

Date: 30th September 2013 Membership No.:070492


Jun 30, 2010

1. We have audited the attached Balance Sheet of Shri Lakshmi Cotsyn Limited as at 30th June, 2010 and the profit and Loss Account for the period ended on that date and the Cash Flow Statement for the period 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. These 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 management, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 , 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.

4. Further to our comments in the Annexure referred to in paragraph 3 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 accounts, as required by law, have been kept by the Company so far as appears from our examination of those.

(c) The Balance Sheet, profit & 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, profit & Loss Account and Cash Flow Statements dealt with by this report, comply with the Accounting Standards referred to in Sub-Section (3C) of Section 211 of the Companies Act, 1956 to the extent applicable.

(e) On the basis of written representation received from the Directors of the Company as on 30th June, 2010 and taken on record by the Board of Directors, we report that none of the Directors is disqualifed as on 30th June, 2010 from being appointed as Director 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 Notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view , in conformity with the Accounting Principles generally accepted in India

(i) In so far as it relates to the Balance Sheet , of the State of Affairs of the Company as at 30th June, 2010 and

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

(iii) In so far as it relates to the Cash Flow Statement of the Cash fow of the Company for the period ended on that date.

ANNEXURE REFERRED IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

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

(ii) As explained to us, the fxed assets have been physically verifed by the management during the period under regular programme of verifcation which in our opinion is reasonable having regard to the size of the Company & nature of its assets. As informed, no material discrepancies were noticed on such verifcation.

(iii) There was no substantial disposal of fxed assets during the period.

2. (i) As explained to us, inventory has been physically verifed by the management at reasonable intervals during the period.

(ii) In our opinion and according to the information and explanations given to us, the procedures at physical verifcation of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(iii) On the basis of our examination of inventory records, we are of the opinion that the Company is maintaining proper records of inventory. As explained to us, there was no material discrepancies noticed on physical verifcation of inventory as compared to the book records.

3. (i) The Company has neither granted nor taken any loan Secured/Unsecured to /from Companies, frms, or other parties covered in the register maintained u/s 301 of the Companies Act, 1956.

(ii) Since Company has not taken any loan from Companies, frms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956 this clause is not applicable.

(iii) Since the Company has not taken any loan from parties covered u/s 301 of the Companies act 1956 comments on this para is not applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fxed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control in respect of these areas.

5. (i) According to the information and explanations given to us , we are of the opinion that the transactions that need to be entered in to the Register maintained under Section 301 of the Companies act 1956 have been so entered.

(ii) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts, of arrangements entered in the Register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rupees Five Lacs in respect of any party during the period have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

6. The Company has not accepted Public deposit u/s 58A and 58AA of the Companies Act, 1956 and rules framed thereunder.

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 in respect of certain 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 & maintained.

9. (i) Undisputed statutory duties in respect of Provident Fund and Income Tax Deducted at source under Income Tax Act, 1961 have been deposited regularly by the Company on prescribed due dates with the appropriate authorities. Further other undisputed statutory dues including Investor , Education and Protection Fund , Income Tax, Wealth tax , Sales Tax, Custom duty , Excise duty and Cess have been deposited subsequently.

(ii) According to the information and explanations given to us, there is no arrear of undisputed statutory dues outstanding as on 30th June, 2010 for a period of more than six months from the date they became payable and these dues have been deposited subsequently.

(iii) Since there no arrears of undisputed statutory dues outstanding comment on this clause not applicable.

10. The Company has no accumulated losses at the end of the financial period ended on 30th June, 2010 and it has not incurred any cash losses in the current and immediately preceding financial year.

11. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial Institutions.

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

13. In our opinion, the Company is not a Chit Fund or nidhi / mutual beneft fund/society.

14. In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. In our opinion and according to the information & explanations given to us, the Company has not given any guarantee for loans taken by others from Bank or financial Institutions.

16. Based on the information and explanations given to us by the management. The Term Loans taken during financial year were applied for the purpose for which the loans were obtained.

17. According to information and explanation given to us and on an overall examination of the Balance Sheet of the Company we are of the opinion that Company has not utilized any short term borrowing for repayment of long term borrowing and acquisition of fxed assets.

18. During the period covered by our audit report Non-Convertible Debentures of Rs. 50 crores were issued by the Company and the Company has also provided Rs. 10 crores (aggregating to Rs.20 crores) as Debenture Redemption Reserve.

19. The Company has not raised any money by way of public issue during the period.

20. Based upon the audit procedures performed by the purpose of reporting true and fair view of the financial statements and according to the information and explanations given to us by the management , in our opinion , no fraud on or buy the Company has been noticed or reported during the course of our audit.

For Pradeep & Associates Chartered Accountants

(P. K. GUPTA)

Place: Kanpur Proprietor

Dated: 28th September, 2010 Membership No.70492


Jun 30, 2009

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