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Auditor Report of Surana Solar Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Surana Solar Limited ("the Company") (formerly Surana Ventures Limited), which comprise the Balance Sheet as at 31st March 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of 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 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 the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 internal financial control, 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 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 control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the 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 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 March 31,2015, and its profit and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in Annexure a statement on 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 Cash Flow Statement dealt with by this Report are in agreement with the books of account

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

e. On the basis of written representations received from the directors as on 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. We are not required to report on clause (i) with respect to Internal Financial Controls over financial reporting and the operating effectiveness of the same for the Financial Year ending 31st March 2015, based on the Government of India notification dated October 14, 2014 on the same matter.

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

i. The Company does not have any pending litigations which would impact its financial position.

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long term contracts including derivative contracts.

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

Annexure referred to in paragraph 1 of our report of even date

Re: Surana Solar Limited (Formerly Surana Ventures Limited)

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

b) As explained to us, the fixed assets have been physically verified by the management according to the phased program designed to cover all the fixed assets over the year. In respect of fixed assets verified according to this program, which we consider reasonable, no material discrepancies were noticed on such verification.

ii. a) As explained to us, inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b) The procedures explained to us, which are followed by the management for physical verification of inventories, are in our opinion reasonable and adequate in relation to the size of the company and nature of its business.

c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

iii. No loans were granted by the Company, to any of the parties covered in the register maintained under section 189 of the Act. Hence we have not reported on the related matters of this clause and sub-clauses (a) and (b)

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of goods and power. We have not observed any major weakness in the internal control system during the course of the audit.

v. The Company has not accepted any deposits from the public within the meaning of sections 73 to 76 or any other relevant provisions of the Act and rules framed thereunder.

vi. We have broadly reviewed the cost records maintained by the Company prescribed by the Central Government of India under Section 148(1) of the Act and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii. a) The Company is regular in depositing undisputed statutory dues with appropriate authorities including provident fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax or cess were in arrears as at 31st March 2015 for a period more than six months from the date they became payable.

c) According to the information and explanations given to us, there are no dues of income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax or cess which have not been deposited on account of any dispute.

d) In our opinion, there are no amounts required to be transferred to the investor education and protection fund by the Company.

viii. The Company has no accumulated losses at the end of the financial year and it has not incurred cash loss during the year covered by audit and in the immediately preceding financial year.

ix. According to the records of the Company examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to any financial institution or bank or debenture holders, as applicable, as at the Balance sheet date.

x. The Company has not given any guarantee for loans taken by others from bank or financial institutions.

xi. We have not reported on this clause as no term loans were obtained by the Company according to the information and explanations given to us.

xii. During the course of our examination of the books and records of the Company, carried out in accordance with the Generally Accepted Accounting Practice in India and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company noticed or reported during the year, nor have we been informed of such case by the management.

For Sekhar & Co Chartered Accountants FRN: 003695-S

G.GANESH Place : Secunderabad Partner Date : 30-May-2015 M.No.211704


Mar 31, 2014

We have audited the accompanying Financial Statements of Surana Ventures Limited ("the Company"), which comprise the Balance Sheet as at 31st March 2014, 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

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. 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.

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the 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 of 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 31st March 2014

b) in the case of Statement of Profit and Loss, the PROFIT of the Company for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of 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 purposes of the 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 sub-section(3C) of section 211 of the Act read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Company Affairs in respect of Section 133 of the Companies Act 2013; and

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 clause (g) of sub-section (1) of section 274 of the Act.

Annexure referred to in paragraph 1 of our report of even date Re: Surana Ventures Limited

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

b) As Explained to us, a substantial portion of the fixed assets have been physically verified by the management during the year, which in our opinion is reasonable, having regard to the size of the company and nature of its assets. According to information and explanations given to us, no material discrepancies have been found on such verification.

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

ii. a) The inventories have been physically verified during the year by the management. In our opinion the frequency of such verification is reasonable.

a) 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 nature of its business.

b) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

iii. a) The Company has during the year granted loans to three companies covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year is Rs..8,14,73,083 and year end outstanding isRs.. Nil.

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

b) The principal and interest wherever due have been paid and there are no outstanding amounts at the end of the year.

c) There are no overdue amounts in excess ofRs.. 1 Lakh in respect of loans granted to companies, firms or other parties listed in the register maintained under section 301 of the Act.

e) The Company has taken loan from three companies covered under the register maintained under section 301 of the Act. The Maximum amount involved was Rs..20,44,14,390 and the year end outstanding was Rs.. 9,61,26,444.

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

g) In our opinion and as per the records examined by us, the payment of principal amount and interest thereon is regular.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the

Company and nature of its business with regards to purchase of inventories and fixed assets and with regard to sale of goods and services. We have not observed any major weakness in the internal control system during the course of audit.

v. a) According to the information and explanations given to us, we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Act have been so entered.

b) In respect of transactions made in pursuance of such contracts or arrangements exceeding the value of Rs.. Five Lakhs entered into during the financial year, because of the unique and specialized nature of the items involved and absence of any comparable transactions, we are unable to comment whether the transactions were made at prevailing market prices at the relevant time.

vi. According to the information and explanations given to us the Company has not accepted any deposits from the public. Therefore, the provisions of clause (vi) of paragraph 4 of the order are not applicable to the Company.

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

viii. 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 Act and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

ix. a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employee''s state insurance, income tax, sales tax, wealth tax, service tax, custom duty excise duty and any other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues in paragraph (a) above were in arrears as at 31st March 2014 for a period more than six months from the date they became payable.

b) According to the information and explanations given to us, enclosed there are no dues of income tax, sales tax, wealth tax, service tax custom duty and excise duty which have not been deposited on account of dispute.

x. The Company has no accumulated losses at the end of the financial year and it has not incurred cash loss during the year covered by audit and in the immediately preceding financial year.

xi. According to the records of the Company examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to any financial institution or bank or debenture holders, as applicable, as at the Balance sheet date.

xii. Based on our examination of documents and records, we are of the opinion that the company has maintained adequate records, where the Company has granted loans and advances on the basis of security by way of pledge of shares and other securities.

xiii. The company is not a Chit Fund or a Nidhi Mutual benefit Fund / Society. Therefore the provisions of 4(xiii) of the Order are not applicable to the Company.

xiv. In our opinion and according to the information and explanations given to us the Company is not dealing in or trading in securities.

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

xvi. In our opinion and according to the information and explanations given to us the term loans have been applied for the purposes or which they are obtained.

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

xviii. The Company has not made preferential allotment of shares to companies / firms parties covered in the register maintained under Section 301 of the Act.

xix. The Company has not issued any debentures or securities on which charge is to be created during the year.

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

xxi. There has been a theft of material costing Rs. 15,00,000 by its employees and a third party during the year, the material has been recovered without incurring any loss pending decision of court.

Except for the above incident of fraud on the company, we have neither come across any other instance of fraud on or by the company during the year during the course of our examination of the books and records of the Company, carried out in accordance with the Generally Accepted Accounting Practice in India and according to the information and explanations given to us.

ForSekhar&Co Chartered Accountants Firm Registration No: 003695-S

G.GANESH Secunderabad Partner 12th May 2014 M.No.211704


Mar 31, 2013

Report on Financial Statements

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

Management''s Responsibility for the Financial Statements

The management is responsible for preparation of these financial statement that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with Accounting Standards referred to in sub-section (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.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards in 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 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 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 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 on that date; and

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

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of subsection (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 are in agreement with the books of account

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

1) Fixed Assets

a) The Company has maintained proper records showing full particulars, including quantitative details of fixed assets

b) The Company has conducted physical verification of fixed assets during the year. In our opinion, this physical verification is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

c) During the period, the Company has discarded certain items of its fixed assets. In our opinion and according the information and explanations given to us, the aforesaid disposal has not affected the going concern assumption.

2) Inventories

a) The inventories have been physically verified by the company during the period. In our opinion the frequency of such verification is reasonable.

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

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

3) Loans to and from Parties (Companies, firms or such other parties) listed in the register maintained under section 301 of the Act, hence forth referred to as parties, amounts in Rupees.

a) The company has granted loans which are not secured to "2" (two) parties during the year. The Maximum amount involved and the year end outstanding is Rs. 26,54,495.

b) The Loans are given free of interest and without any specific terms of repayment. However keeping in view the investment and amount involved we are of opinion, the rate of interest and other terms and conditions of such loan are not, prima facie, prejudicial to the interest of the Company.

c) There being no interest payable and no specific terms of repayment of principal we have nothing to comment about the

status of payment of interest or principal. Hence we have also not reported on subclause d of clause 3 of paragraph 4 of the ''Order''.

d) The company has taken loan from "4" (four) parties during the year. The Maximum amount involved and the year end outstanding are X 32,90,17,406 and X 10,44,09,656 respectively.

e) In our opinion the terms of interest and other terms and conditions on which the loan has been taken from such parties are not prima facie prejudicial to the interest of the Company.

f) The company is regular in payment of principal amounts as stipulated and has been regular in payment of interest.

4) Internal Control:- In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and nature of its business with regard to purchase of inventories and fixed assets and with regard to sale of goods and services. We have not observed any major weakness in the internal control system during the course of audit.

5) Arrangement & Transactions with parties covered under Section 301 of the Act.

a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, the transactions in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of X 5 Lakhs, for goods and services for which suitable alternative sources are not available to obtain comparable quotations. Hence it is not possible for us to comment whether above contracts and arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) Deposits from Public: In our opinion, and according to the information and explanations given to us, the company has not accepted any deposits covered under Section 58A and 58AA of the Act.

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

8) Cost Records: We have broadly reviewed the books of account maintained by the company pursuant to the rules prescribed by the Central Government for maintenance of cost records under Section 209(1) (d) of the Act in respect of products sold by the Company and are of the opinion that prima facie, the prescribed accounts and records have been maintained. However, we have not made a detailed examination of the records.

9) Statutory Dues:

a) According to the information and explanations given to us and on the basis of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees State Insurance, Income tax, Sales Tax, Wealth Tax, Customs Duty, Excise duty, Investor Education and Protection Fund, Service tax, Cess and material statutory dues have been deposited regularly but for some minor delays during the year by the company with the appropriate authorities.

There were no dues on account of Cess under Section 441A of the Act since the aforesaid Section comes into force has not yet been notified by the Central Government.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom duty, Excise duty, Investor Education and Protection Fund, Service Tax, Cess and other material statutory dues which were in arrears as at March 31, 2013 for a period more than six months from the date they became payable.

b) According to the information and explanations give to us, there are no dues in respect of Income Tax, Sales Tax, Service Tax, Excise Duty and such other taxes as detailed have not been deposited with appropriate authorities on account of disputes. According to the information and explanations given to us there are no other amounts not deposited with appropriate authorities on account of dispute.

10) Accumulated Losses & Cash Loss: As on date of Balance Sheet there are no accumulated

Losses and the company has not incurred any cash loss during the year or the immediately preceding financial year.

11) Dues to Banks and Financial Institutions: In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding debentures at the end of the year.

12) Loans on Security of Shares, debentures and other Securities: The Company has maintained adequate records for the loans granted loans and advances on the basis of security of shares and properties.

13) Nidhi chit fund Companies: In our opinion and according to the information and explanations given to us the company is not a nidhi / mutual benefit fund/society.

14) Dealing in/Trading in Securities: According to the information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments.

15) Guarantees on behalf of others: In our opinion, the terms and conditions on which the company has given guarantee for loans taken by others from banks or financial institutions are not prejudicial to the interest of the company.

16) Usage of Term Loans: In our opinion the term loans raised during the year are applied for the purpose they are raise.

17) Usage of Short Term Funds: According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term investment.

18) Preferential allotments: The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Act.

19) Debentures: The Company did not have any outstanding debentures during the year.

20) Public Issue: The Company has not raised any money by public issues during the year.

21) Fraud: According to the information and explanations given to us, no material fraud on the Company has been noticed or reported during the course of the Audit.

For Sekhar & Co.

Chartered Accountants

Firm Regn No : 003695 -S

G. Ganesh

Place: Secunderabad (Partner)

Date: 06th May 2013 Membership No: 211704


Mar 31, 2012

1. We have audited the attached Balance Sheet of Surana Ventures Limited as at March 31, 2012, the Profit and Loss Account and the Cash flow statement for the year ended on that date and annexed thereto. These Financial Statements are the responsibility of the Management. Our Responsibility is to express an opinion on these financial statements based on our audit.

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

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

4. Further to our comments in 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 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 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, Profit and Loss Account and Cash Flow Statement dealt with by this report are in compliance with Accounting Standards referred to in sub-section (3C) of Section 211 of the "Act".

e. on the basis of written representations received from the Directors as on March 31, 2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31,2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the "Act".

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 notes thereon 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.

i. in case of Balance Sheet, of the state of affairs of the Company as at March 31, 2012;

ii. in case of Profit and Loss Account, the profit / loss for the year ended on that date; and

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

Annexure to the Auditors' Report

The Annexure referred to in the auditors' report to the members of Surana Ventures Limited ("the Company"), on the financial statements for the period ended 31st March 2012, we report that:

1) Fixed Assets

a) The Company has maintained proper records showing full particulars, including quantitative details of fixed assets

b) The Company has conducted physical verification of fixed assets during the year. In our opinion, this physical verification is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such verification.

c) During the period, the Company has discarded certain items of its fixed assets. In our opinion and according the information and explanations given to us, the aforesaid disposal has not affected the going concern assumption.

2) Inventories

a) The inventories have been physically verified by the company during the period. In our opinion the frequency of such verification is reasonable.

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

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

3) Loans to and from Parties (Companies, firms or such other parties) listed in the register maintained under section 301 of the Act, hence forth referred to as parties, amounts in Lakhs of Rupees.

a) The company has not granted any loans to the parties listed in the register maintained under section 301 of the act hence we have not reported on the clauses 3(b)- 3(d) of the order.

b) The company has taken loan from 2 parties during the year. The Maximum amount involved and the year end outstanding are Rs.2803.00 lakhs and Rs.1703.00 Lakhs respectively.

c) In our opinion the terms of interest and other terms and conditions on which the loan has been taken from such parties are not prima facie prejudicial to the interest of the Company.

d) The company is regular in payment of principal amounts as stipulated and has been regular in payment of interest.

4) Internal Control:- In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the company and nature of its business with regard to purchase of inventories and fixed assets and with regard to sale of goods and services. We have not observed any major weakness in the internal control system during the course of audit.

5) Arrangement &/ Transactions with parties covered under Section 301 of the Act.

a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the act have been entered in the register required to be maintained under that section.

b) In respect of transactions made in pursuance of such contracts or arrangements exceeding the value of Rs. Five Lakhs entered into during the financial year, because of the unique and specialized nature of the items involved and absence of any comparable prices, we are unable to comment whether the transactions were made at prevailing market prices at the relevant time.

6) Deposits from Public: In our opinion, and according to the information and explanations given to us, the company has not accepted any deposits covered under Section 58A and 58AA of the Act.

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

8) Cost Records: We have broadly reviewed the books of account maintained by the company pursuant to the rules prescribed by the Central Government for maintenance of cost records under Section 209(1) (d) of the Act in respect of products sold by the Company and are of the opinion that prima facie, the prescribed accounts and records have been maintained. However, we have not made a detailed examination of the records.

9) Statutory Dues :

a) According to the information and explanations given to us and on the basis of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees State Insurance, Income tax, Sales Tax, Wealth Tax, Customs Duty, Excise duty, Investor Education and Protection Fund, Service tax, Cess and material statutory dues have been deposited regularly but for some minor delays during the year by the company with the appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom duty, Excise duty, Investor Education and Protection Fund, Service Tax, Cess and other material statutory dues which were in arrears as at March 31 , 201 2 for a period more than six months from the date they became payable.

c) According to the information and explanations give to us, there are no dues in respect of Income Tax, Sales Tax, Service Tax, Excise Duty and such other taxes that have not been deposited with appropriate authorities on account of disputes.

10) Accumulated Losses & Cash Loss: As on date of Balance Sheet there are no accumulated Losses and the company has not incurred any cash loss during the year or the immediately preceding financial year.

11) Dues to Banks and Financial Institutions: In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding debentures at the end of the year.

12) Loans on Security of Shares, debentures and other Securities: The Company has maintained adequate records for the loans granted loans and advances on the basis of security of shares and properties.

13) Nidhi chit fund Companies: In our opinion and according to the information and explanations given to us the company is not a nidhi/mutual benefit fund/society.

14) Dealing in/Trading in Securities: According to the information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments.

15) Guarantees on behalf of others: In our opinion, the terms and conditions on which the company has given guarantee for loans taken by others from banks or financial institutions are not prejudicial to the interest of the company.

16) Usage of Term Loans: In our opinion the term loans raised during the year are applied for the purpose they are raise.

17) Usage of Short Term Funds: According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised on short term basis have not been used for long term investment.

18) Preferential allotments: The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Act.

19) Debentures: The Company has not raised any money by issue of debentures during the year.

20) Public Issue: The Company has not raised any money by public issues during the year.

21) Fraud: According to the information and explanations given to us, no material fraud on the Company has been noticed or reported during the course of the Audit.

For Sekhar & Co.

Chartered Accountants Firm Regn No : 003695 -S

G. Ganesh

Place: Secunderabad Partner

Date: 30th April 2012 Membership No: 211704

 
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