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Auditor Report of Surya Roshni Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of SURYA ROSHNI 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 the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements:

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 with respect to the preparation of these standalone 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 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.

Auditor's Responsibility for the Standalone Financial Statements:

Our responsibility is to express an opinion on these standalone 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. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements:

As required by the Companies (Auditor's Report) Order, 2015 ("The Order") as amended issued by the Central Government of India in terms of sec 143(11) of the Act, we give in the annexure a statement on the matters specified in paragraphs 3 and 4 of the order.

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

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

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

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

(d) In our opinion, the aforesaid standalone 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.

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 as referred to in Note No. 29.1& 29.2 and Note No. 30.8 to the financial statements.

(ii) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, and as required 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 TO THE INDEPENDENT AUDIT REPORT TO MEMBERS OF SURYA ROSHNI LIMITED, FOR THE YEAR ENDED 31ST MARCH 2015.

1. In respect of its fixed assets:

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

b) The Company has regular programme of physical verification, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business. Accordingly, the fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

2 In respect of its inventories:

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

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

c) The Company is maintaining proper records of inventory 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.

Accordingly paragraph 3(iii)(a) to 3(iii)(b) of the order are 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 for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal controls system of the Company.

5. In respect of transactions covered under the provisions of sections 73 and 76 or any other relevant provisions of the Companies Act, 2013:

The company has not accepted any fresh public deposits during the year and pre-paid all earlier public deposits during course of the financial year. No order has been passed by the Company Law Board or the National Company Law Tribunal or by any court or by any other Tribunal with regard to such deposits.

6. We have broadly reviewed the books of accounts relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of Cost Records under Section 148(1) of the Companies Act, 2013 and we are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records

7. In respect of statutory dues:

i. The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees' state insurance, Income Tax, Sales-tax, value added tax , wealth Tax, custom duty, excise duty, service tax, cess and other statutory dues applicable to it. Further No undisputed amount of statutory due were in arrears as at 31st March, 2015 for a period of more than six months from the date they became payable.

ii. The particulars of disputed statutory dues that have not been deposited on account of matters pending before appropriate authorities are as under:

Forum where

S.No Name of the Statute Nature of dues

Excise Duty - Note 1 Central Excise Act,1944 No.27, to the Financial Statements

VAT- Note No.27 to the 2 Sales Tax / VAT Acts Financial Statements

Income -Tax - Note 3 Income Tax Act, 1961 No.30.8 to the Financial Statements

S.No Forum where Dispute is pending Amount (in Rs.)

1. CESTAT 13393777

2. Up to Commissioner Level 1397753

3. CIT (Appeals) 406974683

iii. The amount required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act,1956 (1 of 1956) and rules made thereunder has been transferred to such fund within time.

8. 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.

9. 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, banks. The Company has not issued any debentures.

10. In our opinion and according to the information and explanations given to us, The Company has given Guarantee for loans taken by its erstwhile subsidiary company from banks for term loans of Rs. 135 Crores ( present outstanding is Rs. 21 Crores). The terms and conditions of which are not pre-judicial to the interest of the Company.

11. In our opinion, the term loans have been applied for the purposes for which they were raised.

12. In our opinion and according to the information and explanations given to us, no fraud has been noticed or reported during the year.

For Sastry K. Anandam & Co.

Chartered Accountants

(Firm's Registration No.000179N)

(CA. ANANDA SASTRY K.)

Partner F.C.A

Membership No. 009980

Place : New Delhi Date : 30th May, 2015


Mar 31, 2014

We have audited the accompanying financial statements of SURYA ROSHNI LIMITED, which comprise the Balance Sheet as at March 31, 2014, 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 Statement

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"). 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. 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, 2014;

b) In the case of Statement of Profit and Loss, 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 (Auditor''s Report) Order, 2003 ("the Order") as amended 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 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, 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 Companies Act, 1956.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT TO THE MEMBERS OF SURYA ROSHNI LTD. FOR THE YEAR ENDED 31-03-2014

Referred to in of our Independent Audit Report of even date

1. In respect of its fixed assets:

a) The Company has maintained proper records

showing full particulars, including quantitative details and situation of fixed assets.

b) The Company has a programme of physical

verification on a rotational basis, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business accordingly, certain fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

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

2 In respect of its inventories :

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

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

c) The Company is maintaining proper records of

inventory and no material discrepancies were noticed on physical verification.

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

a) The Company has not granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) Since the Company has not granted any loans, the Clause (b), (c), (d) relating to the rate of interest, receipt of Principal amount, overdue amount does not apply.

c) The Company has not taken any loans, secured or unsecured from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly paragraph 4(iii)(e) to 4(iii)g of the order are not applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal controls commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and 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 controls system of the Company.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956:

a) According to the information and explanations

provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion and according to the information and

explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. Since the Company has not defaulted in repayments of deposits, compliance of Section 58AA. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India.

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

8. We have broadly reviewed the books of accounts relating to materials, labour and other items of cost maintained by the Company Pursuant to the Rules made by the Central Government for the maintenance of Cost Records under Section 209(1) (d) of the Companies Act, 1956 and we are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

9. In respect of statutory dues :

i. The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, Income Tax, Sales/VAT Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

ii. According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales/VAT Tax, Custom Duty, Excise Duty and Cess were in arrears as at 31st March, 2014 for a period of more than six months from the date they became payable.

iii. The disputed statutory dues aggregating to Rs. 2,29,30,777/- that have not been deposited on account of matters pending before appropriate authorities are as under:

Sr. Name of Nature of. Forum where Amount in No. the Statue Dues dispute is (Rs.) pending

1. Central Excise Duty CESTAT 1,33,93,777 Excise Act, 1944

2. UPSEB UPSEB Acts High Court 41,27,000

3. Sales Taxes Upto Tax/VAT Commissioner 30,42,000 Acts Level

High Court 23,68,000

Total 2,29,30,777

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, banks or debenture holders.

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

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

14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the Provisions of Clause 4

(xiv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

15. The Company has given guarantees to the extent of Rs.135 crores to the Bank(s) on account of Term Loans taken by the Subsidiary Company in pursuant to resolution under section 372A of the Companies Act, 1956. The said Subsidiary Company w.e.f 12th February 2014 has become "Associate"

16. In our opinion, the term loans have been applied for the purposes for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets except permanent working capital.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained u/s 301 of the Company Act, 1956.

19. The Company has no debentures as at 31st March, 2014.

20. The Company has not raised any money by way of public issue 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 SASTRY K. ANANDAM & CO. Chartered Accountants (Firm''s Registration No. 000179N)

CA.ANANDA SASTRY K.

Place: New Delhi Partner F.C.A

Dated: 30th May, 2014 Membership No. 009980


Mar 31, 2013

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying fi nancial statements of SURYA ROSHNI LIMITED, which comprise the Balance Sheet as at March 31, 2013, the Statement of Profi t and Loss and Cash Flow Statement for the year then ended and a summary of signifi cant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENT

Management is responsible for the preparation of these fi nancial statements that give a true and fair view of the fi nancial position, fi nancial performance and cash fl ows 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"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the fi nancial 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 fi nancial 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 fi nancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the fi nancial 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 fi nancial 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 fi nancial statements.

We believe that the audit evidence we have obtained is suffi cient 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 fi nancial 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 Statement of Profi t and Loss, of the profi t for the year ended on that date; and

c) In the case of the Cash Flow Statement, of the cash fl ows 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") as amended 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 specifi ed 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 Profi t 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 Profi t 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 disqualifi ed 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.

Referred to in of our Independent Audit Report of even date

1. In respect of its fi xed assets:

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

b) The Company has a programme of physical verifi cation on a rotational basis, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business accordingly, certain fi xed assets have been physically verifi ed by the management during the year and no material discrepancies were noticed on such verifi cation.

c) There was no substantial disposal of fi xed assets during the year.

2. In respect of its inventories :

a) The Management has conducted physical verifi cation of inventory at reasonable intervals during the year.

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

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

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

a) The Company has not granted any loans, secured or unsecured to Companies, fi rms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) Since the Company has not granted any loans, the Clause (b), (c), (d) relating to the rate of interest, receipt of Principal amount, overdue amount does not apply.

c) The Company has not taken any loans, secured or unsecured from Companies, fi rms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

d) Since the Company has not taken any loans, the Clause relating to the rate of interest, payment of Principal amount, overdue amount does not apply.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control commensurate with the size of the Company and the nature of its business for the purchase of inventory, fi xed assets and 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 controls system of the Company.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956:

a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs have been entered into during the fi nancial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. Since the Company has not defaulted in repayments of deposits, compliance of Section 58AA. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India.

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

8. We have broadly reviewed the books of accounts relating to materials, labour and other items of cost maintained by the Company Pursuant to the Rules made by the Central Government for the maintenance of Cost Records under Section 209(1) (d) of the Companies Act, 1956 and we are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

9. In respect of statutory dues :

i. The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, Income Tax, Sales/VAT Tax, Wealth Tax, Service Tax , Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

ii. According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales/VAT Tax, Custom Duty, Excise Duty and Cess were in arrears as at 31st March, 2013 for a period of more than six months from the date they became payable.

iii. The disputed statutory dues aggregating to Rs. 2,29,30,777/- that have not been deposited on account of matters pending before appropriate authorities are as under:

Forum where Sl. No. Name of the Statue Nature of Dues Amount in (Rs.) dispute is pending

1. Central Excise Act, 1944 Excise Duty CESTAT 1,33,93,777

2. UPSEB UPSEB Acts High Court 41,27,000

3. Sales Tax/VAT Acts Taxes Upto Commissioner Level 30,42,000

High Court 23,68,000

Total 2,29,30,777

10. The Company has no accumulated losses and has not incurred any cash losses during the fi nancial year covered by our audit or in the immediately preceding fi 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 fi nancial institutions, banks or debenture holders.

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

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

14. In our opinion, the Company is not dealing in or trading in Shares, securities, debentures and other investments. Accordingly, the Provisions of Clause 4 (xiv) of the Companies (Auditors’ Report) Order, 2003 are not applicable to the Company

15. The Company has given guarantees to the extent of Rs.135 crores to the Bank(s) on account of Term Loans taken by the Subsidiary Company in pursuant to resolution under section 372A of the Companies Act, 1956.

16. In our opinion, the term loans have been applied for the purposes for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to fi nance short term assets except permanent working capital.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained u/s 301 of the Company Act, 1956.

19. The Company has no debentures as at 31st March, 2013.

20. The Company has not raised any money by way of public issue 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 fi nancial statements to be materially misstated. for SASTRY K. ANANDAM & CO.

Chartered Accountants

(Firm Registration No.000179N)

(CA. ANANDA SASTRY K.)

Partner

F.C.A. Membership No.9980

Place : New Delhi

Dated : 28th May, 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of SURYA ROSHNI LIMITED as at 31st March, 2012 the related Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our Audit.

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

3. As required by the Companies (Auditors' Report) Order, 2003 as amended by the Companies (Auditors' Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

(I) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

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

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

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

(v) On the basis of written representations received from the directors as on 31st March, 2012, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements 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 :

a) in so far as it relates to Balance Sheet, of the State of affairs of the Company as at 31st March, 2012;

b) in so far as it relates to Profit and Loss Account, of Profit of the Company for the year ended on that date ; and

c) in so far as it relates to the Cash Flow Statement, of the Cash Flows for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT

(For the year ended 31-3-2012)

Referred to in paragraph 3 of our report of even date

1. In respect of its fixed assets:

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

b) The Company has a programme of physical verification on a rotational basis, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business Accordingly, certain fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

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

2. In respect of its inventories :

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

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

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

3. In respect of 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 granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) Since the Company has not granted any loans, the Clause (b), (c), (d) relating to the rate of interest, receipt of Principal amount, overdue amount does not apply.

c) The Company has not taken any loans, secured or unsecured from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

d) Since the Company has not taken any loans, the Clause relating to the rate of interest, payment of Principal amount, overdue amount does not apply.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control commensurate with the size of the Company and the nature of its business for thepurchase of inventory, fixed assets and 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 controls system of the Company.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956:

a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. Since the Company has not defaulted in repayments of deposits, compliance of Section 58AA. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India.

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

8. We have broadly reviewed the books of accounts relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of Cost Records under Section 209(1)(d) of the Companies Act, 1956 and we are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

9. In respect of statutory dues :

i) the company is generally regular in depositing with appropriate authorities undisputedstatutory dues including provident fund, investor education and protection fund,employees state insurance, Income Tax, Sales/VAT Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

ii) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales/VAT Tax, Custom Duty, Excise Duty and Cess were in arrears as at 31st March, 2012 for a period of more than six months from the date they became payable.

iii) The disputed statutory dues aggregating to Rs. 2,29,30,777/- that have not been deposited on account of matters pending before appropriate authorities are as under:

Sr. Name of Nature of Forum where Amount in No. the Statue Dues dispute is (Rs.) pending

1. Central Excise Duty CESTAT 1,33,93,777 Excise Act, 1944

2. UPSEB UPSEB Acts High Court 41,27,000

3. Sales Taxes Upto Tax/VAT Commissioner 30,42,000 Acts Level High Court 23,68,000

Total 2,29,30,777

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, banks or debenture holders.

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

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

14. In our opinion, the Company is not dealing in or trading in Shares, securities, debentures and other investments. Accordingly, the Provisions of Clause 4 (xiv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company

15. The Company has given guarantees to the extent of Rs.135 crores to the Bank(s) on account of Term Loans taken by the Subsidiary Company in pursuant to resolution under section 372A of the Companies Act, 1956.

16. In our opinion, the term loans have been applied for the purposes for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets except permanent working capital.

18. The Company has 54,75,000 Optionally Convertible Equity Warrants which are outstanding for conversion as on date of Balance Sheet.

19. The Company has no debentures as at 31st March, 2012.

20. The Company has not raised any money by way of public issue 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 SASTRY K. ANANDAM & CO.

CHARTERED ACCOUNTANTS

(Firm Registration No.000179N)

(CA. ANANDA SASTRY K.)

Place : New Delhi PARTNER F.C.A.

Date : 28th May, 2012 Membership No.9980


Mar 31, 2011

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

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

3. As required by the Companies (Auditors' Report) Order, 2003 as amended by the Companies (Auditors' Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

(I) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

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

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

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

(v) On the basis of written representations received from the directors as on 31st March, 2011, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements 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 :

a) in so far as it relates to Balance Sheet, of the State of affairs of the Company as at 31st March, 2011;

b) in so far as it relates to Profit and Loss Account, of Profit of the Company for the year ended on that date ; and

c) in so far as it relates to the Cash Flow Statement, of the Cash Flows for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT (Year ended 31-3-2011)

Referred to in paragraph 3 of our report of even date

1. In respect of its fixed assets:

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

b) The Company has a programme of physical verification on a rotational basis, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business Accordingly, certain fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

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

2. In respect of its inventories :

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

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

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

3. In respect of 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 granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) Since the Company has not granted any loans, the Clause (b), (c), (d) relating to the rate of interest, receipt of Principal amount, overdue amount does not apply.

c) The Company has not taken any loans, secured or unsecured from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

d) Since the Company has not taken any loans, the Clause relating to the rate of interest, payment of Principal amount, overdue amount does not apply.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and 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 controls system of the Company.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956:

a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees Five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. Since theCompany has not defaulted in repayments of deposits, compliance of Section 58AA. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India.

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

8. We have broadly reviewed the books of accounts relating to materials, labour and other items of cost maintained by the Company Pursuant to the Rules made by the Central Government for the maintenance of Cost Records under Section 209(1)(d) of the Companies Act, 1956 and we are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

9. In respect of statutory dues :

I) the company is generally regular in depositing with

appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, Income Tax, Sales/VAT Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

ii) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales/VAT Tax, Custom Duty, Excise Duty and Cess were in arrears as at 31st March, 2011 for a period of more than six months from the date they became payable.

iii) The disputed statutory dues aggregating to Rs.2,83,16,041/- that have not been deposited on account of matters pending before appropriate authorities are as under:

Sl. Name of Nature of. Forum where Amount in No. the Statue Dues dispute is (Rs.) pending

1. Central Excise Duty CESTAT 1,33,93,777 Excise Act, 1944

2. Employees Employees High Court 53,85,264 State State Insurance Insurance Calculation Act, 1966

3. UPSEB UPSEB Acts High Court 41,27,000

4. Sales Taxes Upto 30,42,000 Tax/VAT Commissioner Acts Level High Court 23,68,000

Total 2,83,16,041

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, banks or debenture holders.

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

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

14. In our opinion, the Company is not dealing in or trading in Shares, securities, debentures and other investments. Accordingly, the Provisions of Clause 4 (xiv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company

15. The Company has given guarantees to the extent of Rs.135 crores to the Bank(s) on account of Term Loans taken by the Subsidiary Company in pursuant to resolution under section 372A of the Companies Act, 1956.

16. In our opinion, the term loans have been applied for the purposes for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets except permanent working capital.

18. The Company has outstanding 45,70,000 Optionally Convertible Equity Warrants (Series I) as on 31st March,2010. The Company has further issued the Preferential allotment of 1,14,30,000 Optionally Convertible Equity Warrants (Series II) to Promoters Group at a price of Rs.83/- which includes a premium of Rs.73/- per share and 54,75,000 Optionally Convertible Equity Warrants (Series III) to Promoters Group at a price of Rs.111/- which includes a premium of Rs.101/- per share calculated on the relevant date, in accordance with the SEBI (Issues of Capital & Disclosure Requirements) Regulations, 2009 and furthermore 45,70,000 outstanding Optionally Convertible Equity Warrants (Series I) and 1,14,30,000 Warrants (Series II) were converted into Equity Shares of Rs.10/- each fully paid and entire 54,75,000 Optionally Convertible Equity Warrants (Series III) are still outstanding for conversion as on date of Balance Sheet.

19. The Company has no debentures as at 31st March, 2011.

20. The Company has not raised any money by way of public issue 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 Sastry K. Anandam & Co. Chartered Accountants (Firm Registration No. 000179N)

(C.A. ANANDA SASTRY K.) PARTNER F.C.A. Membership No. 9980

Place : New Delhi Date : 5th May, 2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of M/s SURYA ROSHNI LIMITED as at 31st March, 2010 the related Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our Audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure hereto a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

(i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

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

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

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

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

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements 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 :

a) in so far as it relates to Balance Sheet, of the State of affairs of the Company as at 31st March, 2010;

b) in so far as it relates to Profit and Loss Account, of PROFIT of the Company for the year ended on that date ; and

c) in so far as it relates to the Cash Flow Statement, of the Cash Flows for the year ended on that date. ANNEXURE TO THE AUDITORS REPORT Referred to in paragraph 3 of our report of even date

1. In respect of its fixed assets:

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

b) The Company has a programme of physical verification on a rotational basis, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business Accordingly, certain fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

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

2. In respect of its inventories :

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

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

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

3. In respect of 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 granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) Since the Company has not granted any loans, the Clause (b), (c), (d) relating to the rate of interest, receipt of Principal amount, overdue amount does not apply.

c) The Company has not taken any loans, secured or unsecured from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

d) Since the Company has not taken any loans, the Clause relating to the rate of interest, payment of Principal amount, overdue amount does not apply.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and 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 controls system of the Company.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956:

a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. Since the Company has not defaulted in repayments of deposits, compliance of Section 58AA. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India.

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

8. We have broadly reviewed the books of accounts relating to materials, labour and other items of cost maintained by the Company Pursuant to the Rules made by the Central Government for the maintenance of Cost Records under Section 209(1) (d) of the Companies Act, 1956 and we are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

9. In respect of statutory dues :

i) the company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, Income Tax, Sales/VAT Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it.

ii) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales/VAT Tax, Custom Duty, Excise Duty and Cess were in arrears as at 31st March, 2010 for a period of more than six months from the date they became payable.

iii) The disputed statutory dues aggregating to Rs.3,97,80,382/- that have not been deposited on account of matters pending before appropriate authorities are as under:

Sl. Name of Nature of Forum where Amount No. the Statue Dues dispute is in (Rs.) pending

1. Central Excise Excise Duty CESTAT 2,67,87,554 Act, 1944

2. Employees Employees High Court 34,55,828 State Insurance State Act, 1966 Insurance Calculation

3. UPSEB UPSEB Acts High Court 41,27,000

4. Sales Tax/VAT Taxes Upto 30,42,000 Acts Commissioner Level High Court 23,68,000

Total 3,97,80,382

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, banks or debenture holders.

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

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

14. In our opinion, the Company is not dealing in or trading in Shares, securities, debentures and other investments. Accordingly, the Provisions of Clause 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company

15. The Company has given guarantees to the extent of Rs.135 crores to the Bank(s) on account of Term Loans taken by the Subsidiary Company in pursuant to resolution under section 372A of the Companies Act, 1956.

16. In our opinion, the term loans have been applied for the purposes for which they were raised.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments. No long term funds have been used to finance short term assets except permanent working capital.

18. The Company has issued the Preferential allotment of 64,00,000 Optionally Convertible Equity Warrants to Promoters Group at a price of Rs.59/- which includes a premium of Rs.49/- per share calculated on the relevant date, in accordance with the SEBI (Issues of Capital & Disclosure Requirements) Regulations, 2009 and out of which 18,30,000 were converted into Equity Shares of Rs.10/- each fully paid and 45,70,000 Warrants are still outstanding for conversion as on date of the Balance Sheet.

19. The Company has no debentures as at 31st March, 2010.

20. The Company has not raised any money by way of public issue 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 SASTRY K. ANANDAM AND CO. CHARTERED ACCOUNTANTS

(CA. ANANDA SASTRY K.)

Partner, F.C.A.

Place : New Delhi Membership No. 9980

Dated : 28th May, 2010 Firm Registration No.000179N

 
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