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Auditor Report of Tamil Nadu Newsprint And Papers Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of M/s. Tamil Nadu Newsprint and Papers Limited ['the Company'] which comprise the Balance Sheet as at 31st March 2015 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 Standalone Financial Statements

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone 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 standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of 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 standalone 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 Statement of Profit and Loss and its Cash Flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

1. As required under Section 143[5] of the Companies Act, 2013, we give in the "Annexure A" our report on the directions issued by the Comptroller and Auditor General of India.

2. As required by the Companies [Auditor's Report] Order, 2015 ["the Order"], issued by the Central Government of India in terms of Sub-section [11] of Section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

3. As required by Section 143[3] of the Act, we report that:

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

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

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

d) In our opinion, the aforesaid 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 written representations received from the directors as on 31st March 2015, and 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 and

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements as referred to in Note No. 27 to the standalone 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 as referred to in Note No. 28 [k] &[l] to the standalone financial statements.

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

"Annexure A" to Independent Auditor's Report

No. Compliance Comments

01 If the Company has been selected for Not Applicable disinvestment, a complete status report in terms of valuation of Assets [including intangible assets and land] and Liabilities [including Committed & General Reserves] may be examined including the mode and present stage of disinvestment process

02 Please report whether there are any cases of Nil waiver / write-off of debts / loans / interest, etc. If yes, the reasons therefore and the amount involved

03 Whether proper records are maintained for There were no inventories lying with third parties and assets inventories lying received as gift from Government or other with third authorities parties during the year under review. During the year, the Company did not receive anything as gift from Government or other authorities

04 A report on age-wise analysis of pending legal/ Mostly cases are arbitration cases including the reasons of pending due to pendency and existence / effectiveness of a the obligations monitoring mechanism for expenditure on all of the counter legal cases [foreign and local] may be given party or due to further appeals / revision petitions filed. Approval from Senior Executives is obtained for legal expenses in accordance with the delegation of powers as approved by the Board. The Company has a Legal Department which is monitoring the legal cases and reported to the Board periodically.

Age-wise analysis of pending legal/ arbitration cases is as given below:

Sl. No. Period No. of Cases

01 Less than 1 year 21

02 1 year to 3 years 62

03 3 years to 5 years 26

04 5 years to 10 years 44

05 More than 10 years 58

Total 211

The Annexure referred to in paragraph 2 of our report of even date to the members of M/s. Tamil Nadu Newsprint and Papers Limited on the accounts of the Company for the year ended 31st March 2015

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

Fixed Assets

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

b) The fixed assets have been physically verified by the Management at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

Inventory and its physical verification

a) The inventory has been physically verified during the year by the Management. In our opinion, the frequency of verification is reasonable.

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

c) The Company has maintained proper records of inventory and no material discrepancies were noticed on physical verifications.

Loans granted / taken from related Companies

a) The Company has not granted any loans and advances, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Act.

b) The Company has not taken any loans and advances, secured or unsecured from companies, firms or other parties covered in the register maintained under section 189 of the Act.

Internal Control

a) In our opinion and according to the information and explanations given to us, there are adequate internal control systems and procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and for sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

Public Deposits

a) According to the information and explanations given to us, the Company has not accepted any deposits from the public during the year.

Internal Audit

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

Cost Records

a) The Central Government has prescribed the maintenance of cost records by the Company under Section 148(1)of the Companies Act, 2013 and we are of the opinion that prima facie, the books of accounts have been maintained by the Company and the proforma specified therein for the year are under preparation. We have however not carried out a detailed verification of such records.

Statutory Dues

a) The Company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Customs Duty and Cess and any other material statutory dues applicable to it with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable were in arrears for a period of 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 Sales Tax / Income Tax / Customs Duty / Wealth Tax / Service Tax / Excise Duty / Cess which have not been deposited on account of any dispute other than those given below:

Name of the Statute Nature of Period to Dues which the amount pertains

Cenvat Credit Rules, 2004 Excise Duty Exemption 1997-1998 1998-1999

Cenvat Credit Rules, 2004 Capital Goods Credit 1997-1998 1998- 1999 1999- 2000 2000- 2001 2001-2002

Cenvat Credit Rules, 2004 Capital Goods Credit 2003-2004 2004- 2005 2005- 2006 2006- 2007

Cenvat Credit Rules, 2004 Capital Goods Credit 2006-2007 2007- 2008

Cenvat Credit Rules, 2004 Input credit reversal 2006-2007 on effluent 2007-2008 sludge waste 2008-2009 2009- 2010

Cenvat Credit Rules, 2004 Input Service Credit 2007-2008 2008- 2009

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-2009

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-2009

Cenvat Credit Rules, 2004 Capital Goods Credit 2009-2010

Cenvat Credit Rules, 2004 Capital Goods Credit 2009-2010 2010- 2011

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Cenvat Credit Rules, 2004 Input credit reversal 2010-2011 on effluent sludge waste

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Customs Act, 1962 Custom Duty 1999-2000

Customs Act, 1962 Custom Duty 1999-2000

Customs Act, 1962 Custom Duty 1991-1992

Customs Act, 1962 Custom Duty 1991-1992

Customs Act, 1962 Custom Duty 1991-1992

Customs Act, 1962 Custom Duty 1997-1998

Customs Act, 1962 Custom Duty 1997-1998

Customs Act, 1962 Custom Duty 1997-1998

Customs Act, 1962 Custom Duty 2014-2015

Income Tax Act, 1961 Income Tax 2002-2003

Income Tax Act, 1961 Income Tax 2003-2004

Income Tax Act, 1961 Income Tax 2004-2005

Income Tax Act, 1961 Income Tax 2006-2007

Income Tax Act, 1961 Income Tax 2007-2008

Income Tax Act, 1961 Income Tax 2009-2010

Income Tax Act, 1961 Income Tax 2010-2011

Income Tax Act, 1961 Income Tax 2011-2012

Income Tax Act, 1961 Income Tax 2012-2013

Wealth Tax Act, 1957 Wealth Tax 1997-1998

Wealth Tax Act, 1957 Wealth Tax 1998-1999

Wealth Tax Act, 1957 Wealth Tax 1999-2000

Wealth Tax Act, 1957 Wealth Tax 2001-2002

Wealth Tax Act, 1957 Wealth Tax 2002-2003

TNVAT Act, 2006 Value Added Tax 2006-2007

TNVAT Act, 2006 Value Added Tax 2007-2008

TNVAT Act, 2006 Value Added Tax 2008-2009

TNVAT Act, 2006 Value Added Tax 2009-2010

TNVAT Act, 2006 Value Added Tax 2010-2011

TNVAT Act, 2006 Value Added Tax 2011-2012

TNVAT Act, 2006 Value Added Tax 2012-2013

Central Sales Tax Act, Central Sales Tax 1997-1998 1956

Central Sales Tax Act, Central Sales Tax 1998-1999 1956

Central Sales Tax Act, Central Sales Tax 1999-2000 1956

Central Sales Tax Act, Central Sales Tax 2000-2001 1956



Name of the Statute Amount Forum where the (Rs.Lakhs) dispute is pending

Cenvat Credit Rules, 2004 4.25 CESTAT Chennai

Cenvat Credit Rules, 2004 57.97 Hon'ble High Court of Madras

Cenvat Credit Rules, 2004 1388.28 CESTAT Chennai

Cenvat Credit Rules, 2004 10537.01 CESTAT Chennai

Cenvat Credit Rules, 2004 5440.95 CESTAT Chennai

Cenvat Credit Rules, 2004 972.12 CESTAT Chennai

Cenvat Credit Rules, 2004 10.32 Hon'ble High Court of Madras

Cenvat Credit Rules, 2004 31.96 CESTAT Chennai

Cenvat Credit Rules, 2004 394.77 CESTAT Chennai

Cenvat Credit Rules, 2004 14380.97 CESTAT Chennai

Cenvat Credit Rules, 2004 4.20 Hon'ble High Court of Madras

Cenvat Credit Rules, 2004 5.01 Commissioner Appeals, Trichy

Cenvat Credit Rules, 2004 910.13 CESTAT Chennai

Cenvat Credit Rules, 2004 929.42 CESTAT Chennai

Customs Act, 1962 106.29 Commissioner Chennai

Customs Act, 1962 20.45 Commissioner Cochin

Customs Act, 1962 1.30 Commissioner Appeals, Chennai

Customs Act, 1962 1.03 Commissioner Appeals, Trichy

Customs Act, 1962 33.33 Commissioner Chennai and Hon'ble High Court of Madras

Customs Act, 1962 54.00 Commissioner Chennai

Customs Act, 1962 14.94 Commissioner Chennai

Customs Act, 1962 39.87 Commissioner Chennai

Customs Act, 1962 84.11 Commissioner Chennai

Income Tax Act, 1961 16.48 Assessing Officer Chennai

Income Tax Act, 1961 612.81 Hon'ble High Court of Madras and Commissioner of Appeals, Chennai

Income Tax Act, 1961 40.87 ITAT, Chennai

Income Tax Act, 1961 41.18 ITAT, Chennai

Income Tax Act, 1961 138.52 ITAT, Chennai

Income Tax Act, 1961 2433.29 Commissioner of Appeals, Chennai

Income Tax Act, 1961 2057.31 Commissioner of Appeals, Chennai

Income Tax Act, 1961 2019.39 Commissioner of Appeals, Chennai

Income Tax Act, 1961 2465.43 Commissioner of Appeals, Chennai

Wealth Tax Act, 1957 1.37 Commissioner of Appeals, Chennai

Wealth Tax Act, 1957 6.50 Commissioner of Appeals, Chennai

Wealth Tax Act, 1957 5.81 Commissioner of Appeals, Chennai

Wealth Tax Act, 1957 5.63 Commissioner of Appeals, Chennai

Wealth Tax Act, 1957 0.15 Commissioner of Appeals, Chennai

TNVAT Act, 2006 0.90 Appellate Deputy Commissioner [CT] Trichy

TNVAT Act, 2006 134.08 Appellate Deputy Commissioner [CT] Trichy

TNVAT Act, 2006 150.65 Appellate Deputy Commissioner [CT] Trichy

TNVAT Act, 2006 120.56 Appellate Deputy Commissioner [CT] Trichy

TNVAT Act, 2006 102.13 Appellate Deputy Commissioner [CT] Trichy

TNVAT Act, 2006 52.13 Appellate Deputy Commissioner [CT] Trichy

TNVAT Act, 2006 87.82 Appellate Deputy Commissioner [CT] Trichy

Central Sales Tax Act, 11.47 Appellate Deputy 1956 Commissioner [CT] Trichy

Central Sales Tax Act, 12.90 Appellate Deputy 1956 Commissioner [CT] Trichy

Central Sales Tax Act, 8.30 Appellate Deputy 1956 Commissioner [CT] Trichy

Central Sales Tax Act, 10.03 Appellate Deputy 1956 Commissioner [CT] Trichy

Total 45958.39

d) According to the information and explanation given to us, the amount required to be transferred to the Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 2013 and rules made thereunder have been transferred by the Company to the fund within time.

Sick Company

a) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred any cash losses during the financial year covered by our audit and in the immediately preceding financial year.

Guarantees given by the Company

a) In our opinion and according to the information and explanation given to us and based on the records produced before us during the course of our audit, the Company has not given any guarantee during the year.

Term Loans

a) The Company has obtained term loans during the year which were prima facie, applied for the purpose which they were obtained.

b) On the basis of verification of records and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders. The Company has not raised any monies against issue of debentures during the year.

Frauds noticed

a) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India and to the best of our knowledge and according to the information and explanations given to us, no fraud of material nature on or by the Company has been noticed or reported during the year nor have we been informed of any such case by the management.

As per our report of even date For Raman Associate Chartered Accountants Firm Registration No. - 002910S

G. Vasudevan Partner Membership No. 020739 Place - Chennai Date - 28th May, 2015


Mar 31, 2014

We have audited the accompanying financial statements of M/s. Tamil Nadu Newsprint and Papers 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

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 13-09-2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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 purpose of expressing an opinion on the effectiveness of the entity''s internal control. 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 31st March 2014;

b) In the case of the 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, the 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 Companies Act, 1956 read with the General Circular 15/2013, dated 13-09-2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

e) On the basis of written representations received from the directors as on 31st March 2014, and taken on record by the

Board of Directors, none of the directors is disqualified as on 31st March 2014, from being appointed as a director in terms of clause [g] of sub-section [1] of Section 274 of the Companies Act, 1956 and

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

THE ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF M/S. TAMIL NADU NEWSPRINT AND PAPERS LIMITED ON THE ACCOUNTS OF THE COMPANY FOR THE YEAR ENDED 31ST MARCH 2014

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

Fixed Assets

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

b) The fixed assets have been physically verified by the Management at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

Inventory and its physical verification

a) The inventory has been physically verified during the year by the Management. In our opinion, the frequency of verification is reasonable.

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

c) The Company has maintained proper records of inventory and no material discrepancies were noticed on physical verifications.

Loans granted / taken from related Companies

a) The Company has not granted any loans and advances, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act. Consequently, the provisions of clauses 4 [iii] [b], [iii] [c] and [iii] [d] of the Order are not applicable to the Company.

b) The Company has not taken any loans and advances, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Act. Accordingly, paragraphs 4 [iii] [e] to 4 [iii] [g] of the Order are not applicable.

Internal Control

a) In our opinion and according to the information and explanations given to us, there are adequate internal control systems and procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and for sale of goods. We have not observed any major weakness in the internal control system during the course of the audit.

Transactions with parties'' u/s. 301

a) In our opinion and according to the information and explanations given to us, there are no contracts or arrangements referred to Section 301 of the Companies Act, 1956 that needs to be entered into the register maintained under the section.

Public Deposits

a) According to the information and explanations given to us, the Company has not accepted any deposits from the public during the year as outlined under the provisions of the Companies (Acceptance of Deposits) Rules, 1975, as amended till date. Hence the provisions of Section 58A, 58AA or other relevant provisions of the Companies Act, 1956 are not applicable.

Internal Audit

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

Cost Records

a) The Central Government has prescribed the maintenance of cost records by the Company under Section 209(1) (d) of the Companies Act, 1956 and we are of the opinion that prima facie, the books of accounts prescribed under the Cost Accounting records [Paper] Rules, 1975, have been maintained by the Company and the proforma specified therein for the year are under preparation. We have however not carried out a detailed verification of such records.

Statutory Dues

a) The Company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty, Customs Duty and Cess and any other material statutory dues applicable to it with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable were in arrears for a period of more than six months from the date they became payable. The Employees'' State Insurance Act does not apply to the Company.

c) According to the information and explanations given to us, there are no dues of Sales Tax / Income Tax / Customs Duty / Wealth Tax / Service Tax / Excise Duty / Cess which have not been deposited on account of any dispute other than those given below:

Name of the Statute Nature of Period to which Dues the amount pertains

Cenvat Credit Rules, 1944 Excise Duty Exemption 1997-1998 & 1998-1999

Cenvat Credit Rules, 2004 Input Credit Reversal 1997-1998 1998-1999 1999-2000 2000-2001 2001-2002

Cenvat Credit Rules, 2004 Capital Goods Credit 2003-2004 2004-2005 2005-2006 2006-2007

Cenvat Credit Rules, 2004 Capital Goods Credit 2006-2007 2007-2008

Cenvat Credit Rules, 2004 Input credit reversal 2006-07 on effluent 2007-08 sludge waste 2008-09 2009-10

Cenvat Credit Rules, 2004 Input Service Credit 2007-08 2008-09

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09 2009-10

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-2009

Cenvat Credit Rules, 2004 Capital Goods Credit 2009-2010

Cenvat Credit Rules, 2004 Capital Goods Credit 2009-2010 2010-2011

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Cenvat Credit Rules, 2004 Input credit reversal 2010-2011 on effluent sludge waste



Name of the Statute Amount Forum where the dispute (Rs.Lakhs)is pending

Cenvat Credit Rules, 1944 4.25 Tribunal, Chennai

Cenvat Credit Rules, 2004 4.82 Hon''ble High 2.59 Court of Madras 1.00 47.06 0.55

Cenvat Credit Rules, 2004 49.11 Tribunal Chennai 266.11 731.12 268.18

Cenvat Credit Rules, 2004 6548.75 Tribunal, Chennai 3418.78

Cenvat Credit Rules, 2004 23.91 Tribunal, Chennai 33.70 2203.39 2856.22

Cenvat Credit Rules, 2004 255.62 Tribunal, Chennai 660.76

Cenvat Credit Rules, 2004 9.44 Hon''ble High Court of Madras

Cenvat Credit Rules, 2004 15.42 Tribunal, Chennai 13.66

Cenvat Credit Rules, 2004 104.16 Commissioner, Appeals, Trichy

Cenvat Credit Rules, 2004 363.64 Tribunal, Chennai

Cenvat Credit Rules, 2004 11135.33 Tribunal, Chennai 2067.89

Cenvat Credit Rules, 2004 3.79 Tribunal, Chennai

Cenvat Credit Rules, 2004 4.53 Hon''ble High Court of Madras

Cenvat Credit Rules, 2004 5.10 Commissioner, Appeals, Trichy

Cenvat Credit Rules, 2004 824.97 Tribunal, Chennai

Name of the Statute Nature of Period to which Dues the amount pertains

Cenvat Credit Rules, 2004 Capital Goods Credit 2010-2011

Cenvat Credit Rules, 2004 Capital Goods Credit 2011-2012 2012-2013 2013-2014

Cenvat Credit Rules, 2004 Capital Goods Credit 2012-2013 2013-2014

Customs Act, 1962 Customs Duty 1991-1992

Customs Act, 1962 Customs Duty 1997-1998

Customs Act, 1962 Customs Duty 1999-2000

Customs Act, 1962 Customs Duty 1999-2000

Income Tax Act, 1961 Income Tax AY 2002-2003

Income Tax Act, 1961 Income Tax AY 2003-2004

Income Tax Act, 1961 Income Tax AY 2004-2005

Income Tax Act, 1961 Income Tax AY 2005-2006

Income Tax Act, 1961 Income Tax AY 2006-2007

Income Tax Act, 1961 Income Tax AY 2007-2008

Income Tax Act, 1961 Income Tax AY 2008-2009

Income Tax Act, 1961 Income Tax AY 2009-2010

Income Tax Act, 1961 Income Tax AY 2010-2011

Income Tax Act, 1961 Income Tax AY 2011-2012

Wealth Tax Act, 1957 Wealth Tax AY 1997-1998 To AY 1999-2000 & AY 2001-2002 to AY 2003-2004

Name of the Statute Amount Forum where the dispute (Rs.Lakhs)is pending



Cenvat Credit Rules, 2004 838.48 Tribunal, Chennai

Cenvat Credit Rules, 2004 1.30 Commissioner, 0.20 Appeals, Trichy 0.25

Cenvat Credit Rules, 2004 4.31 Commissioner, 0.76 Appeals, Trichy

Customs Act, 1962 44.34 Commissioner, Chennai and Hon''ble High Court of Madras

Customs Act, 1962 54.81 Commissioner, Chennai

Customs Act, 1962 106.29 Commissioner, Chennai

Customs Act, 1962 20.45 Commissioner, Cochin

Income Tax Act, 1961 16.48 Assessing Officer, Chennai

Income Tax Act, 1961 612.81 Hon''ble High Court of Madras/ Commissioner of Appeals, Chennai

Income Tax Act, 1961 40.87 Tribunal, Chennai

Income Tax Act, 1961 212.96 Assessing Officer, Chennai

Income Tax Act, 1961 41.18 Commissioner of Appeals, Chennai

Income Tax Act, 1961 138.53 Commissioner of Appeals, Chennai

Income Tax Act, 1961 65.54 Commissioner of Appeals, Chennai

Income Tax Act, 1961 1680.20 Commissioner of Appeals, Chennai

Income Tax Act, 1961 2057.31 Commissioner of Appeals, Chennai

Income Tax Act, 1961 2019.39 Commissioner of Appeals, Chennai

Wealth Tax Act, 1957 19.46 Assessing Officer, Chennai 39899.77

Sick Company

a) The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and incurred such cash losses in the immediately preceding financial year.

Default in dues to Bank / Financial Institutions / Debenture holders

a) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any Bank, Financial Institutions or Debenture Holders.

Loans and advances made by the Company

a) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence the question of documents and records does not arise.

Nidhi / Mutual Benefit Fund / Chit Funds

a) According to the information and explanations given to us, the nature of activities of the Company does not attract any special statute applicable to chit fund and nidhi / mutual benefit / society.

Record of Shares, Securities

a) In our Opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Hence this clause is not applicable to the Company.

Guarantees given by the Company

a) The Company has not given any guarantee for loans taken by others from banks or financial institutions based on the records produced to us during the course of our audit.

Term Loans and Short-term funds taken

a) The Company has obtained term loans during the year which were prima facie, applied for the purpose which they were obtained. However, according to the information and explanations given to us, the Company has not drawn the term loan during the year to the extent of Rs. 1054.05 crores out of Rs. 1250.00 crores of sanctioned limits.

b) According to the information and explanations given to us and 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 investment.

Preferential allotment of shares

a) The Company has not issued any shares during the year and hence the requirement regarding any preferential allotment of shares to parties covered in the register maintained under Section 301 of the Companies Act, 1956, is not applicable.

b) According to the information and explanation given to us, the Company has not issued any debentures during the year. However, in respect of debentures outstanding at the end of the year, necessary security or charge has been created.

Disclosure of end use of funds raised in public issues

a) The Company has not raised any money though public issue during the year and as such the requirement regarding disclosure of end use of such money raised is not applicable. Hence the provision of clause 4 [xx] of the Companies [Auditor''s Report] Order, 2003 are not applicable to the Company.

Frauds noticed

a) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India and to the best of our knowledge and according to the information and explanations given to us, no fraud of material nature on or by the Company has been noticed or reported during the year nor have we been informed of any such case by the management.

As per our report of even date For Raman Associate Chartered Accountants Firm Registration No. 002910S

G. Vasudevan Partner Membership No. 020739

Place - Chennai Date - 29th May 2014


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in 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, 2013;

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

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a. we have obtained all the information and 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.

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

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT Re: TAMIL NADU NEWSPRINT AND PAPERS LIMITED.

REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE,

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

(b) Fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

(c) No substantial part of fixed assets has been disposed off during the year.

ii) (a) Physical verification of inventory has been conducted at reasonable intervals by the management;

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

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

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

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v) As per the information and explanation given to us, there are no contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that needs to be entered into the register maintained under the section.

vi) The company has not accepted any deposits from public during the year. Hence the provisions of section 58A, 58AA or other relevant provisions of the Companies Act, 1956 are not applicable.

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

viii) The Central Government has prescribed the maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956 and we are of the opinion that prima facie, the books of accounts prescribed under the Cost Accounting Records (Paper) Rules, 1975, have been maintained by the company and the proforma specified therein for the year are under preparation. We have however not carried out a detailed verification of such records.

ix) (a) The company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income-Tax, Sales-Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable were in arrears, for a period more than six months from the date they become payable. The Employees'' State Insurance Act does not apply to the company.

(b) According to the information and explanations given to us, there are no dues of Sales Tax/Income Tax/Customs Duty/Wealth Tax/Service Tax/Excise Duty/Cess which have not been deposited on account of any dispute other than those given below:



Name of the Statute Nature of Period to which Amount Forum where the Dues the amount pertains (Rs.Lakhs) dispute is pending

Central Excise Act, 1944 Excise Duty Exemption 1997-1998 4.25 TribunalChennai and 1998-99

Cenvat Credit Rules, 2004 Input Credit Reversal 1997-1998 4.82 Hon''ble High

1998-1999 2.59 Court of Madras

1999-2000 1.00

2000-2001 45.11

2001-2002 0.55

Cenvat Credit Rules, 2004 Capital Goods Credit 2003-2004 46.61 Tribunal Chennai 2004-2005 251.85

2005-2006 689.87

2006-2007 252.44

Cenvat Credit Rules, 2004 Input Service Credit 2006-2007 15.45 Commissioner

2007-2008 17.65 Appeals

Cenvat Credit Rules, 2004 Capital Goods Credit 2006-07 6179.96 Tribunal Chennai 2007-08 3218.09

Cenvat Credit Rules, 2004 Input credit reversal 2006-07 21.92 Tribunal Chennai on effluence 2007-08 30.77

sludge waste 2008-09 1998.35

2009-10 2742.46

Cenvat Credit Rules, 2004 Input Service Credit 2007-08 240.15 Tribunal Chennai 2008-09 620.50

Cenvat Credit Rules, 2004 Input Service Credit 2008-09 8.58 High Court

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09 13.91 Tribunal Chennai

2009-10 12.92

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09 95.67 Commissioner Appeals

Cenvat Credit Rules, 2004 Capital Goods Credit 2009-10 331.99 Tribunal Chennai

Cenvat Credit Rules, 2004 Capital goods credit 2009-10 9338.90 Tribunal Chennai 2010-11 2031.35

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 3.39 Tribunal Chennai

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 4.05 Hon''ble HighCourt of Madras

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 4.55 Commissioner Appeals

Cenvat Credit Rules, 2004 Input credit reversal on 2010-11 739.81 Tribunal Chennai effluence sludge waste

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 747.54 Tribunal Chennai

Customs Act, 1962 Customs Duty 1991-92 44.34 Commissioner

Customs Act, 1962 Customs Duty 1997-98 54.81 Commissioner

Customs Act, 1962 Customs Duty 1999-00 126.74 Commissioner

Income Tax Act, 1961 Income Tax AY 2002-03 60.69 Assessing Officer

Income Tax Act, 1961 Income Tax AY 1996-97 to 244.47 Assessing Officer 2000-01 & 2003-04

Income Tax Act, 1961 Income Tax AY 1996-97 to 283.58 Commissioner

2000-01 & 2003-04 Appeals

Income Tax Act, 1961 Income Tax AY 2003-04 96.43 High Court Chennai

Income Tax Act, 1961 Income Tax AY 2004-05 65.16 CIT (A) / Tribunal

Income Tax Act, 1961 Income Tax AY 2005-06 137.96 Assessing Officer

Income Tax Act, 1961 Income Tax AY 2006-07 41.18 Commissioner (Appeals)

Income Tax Act, 1961 Income Tax AY 2007-08 138.53 Commissioner (Appeals)

Income Tax Act, 1961 Income Tax AY 2008-09 65.54 Commissioner (Appeals)

Income Tax Act, 1961 Income Tax AY 2009-10 1680.20 Commissioner (Appeals)

Income Tax Act, 1961 Income Tax AY 2010-11 2057.31 Commissioner (Appeals)

Wealth Tax Act, 1957 Wealth Tax AY 1997-98 to 19.46 Assessing Officer

1999-2000 & 2001-02 to

2003-04

Total 34832.80



x) The Company does not have accumulated losses as at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

xi) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution, bank or debenture holders.

xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence the question of maintenance of documents and records does not arise.

xiii) The Company is not a chit fund or a nidhi / mutual benefit fund / society. Hence this clause is not applicable to the company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Hence this clause is not applicable to the company.

xv) The company has not given any guarantee for loans taken by others from banks or financial institutions based on the records produced to us.

xvi) According to the information and explanations given to us, the company has not utilized the term loan to the extent of Rs. 30.91 Crores for the purpose for which it has been obtained.

xvii)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 investment.

xviii)According to the information and explanations given to us, during the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix) As per the information and explanation given to us, the company has not issued any debentures during the year. However, in respect of debentures outstanding at the end of the year, necessary security or charge has been created.

xx) The company has not raised any money through public issue. Hence the provisions of clause 4(xx) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

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



For P.B. Vijayaraghavan & Co.

Chartered Accountants

Firm Registration No. 004721S

P.B. Srinivasan

Partner

Membership No. 203774

Place - Chennai

Date - 27th May 2013


Mar 31, 2012

1. We have examined the compliance of conditions of Corporate Governance by M/s. Tamil Nadu Newsprint and Papers Limited, for the year ended 31st March 2012 as stipulated in clause 49 of the Listing Agreement of the said Company with the Stock Exchange(s).

2. The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

3. In our opinion and to the best of our information and according to the explanations given to us and the representations made by the Directors and the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

4. As required by the Guidance Note issued by the Institute of Chartered Accountants of India, we state that as per the records maintained and certified by the Registrars of the Company, there were no investors grievances remaining unattended/pending for more than 30 days as at 31st March 2012.

5. We further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

We have audited the attached Balance Sheet of TAMIL NADU NEWSPRINT AND PAPERS LIMITED, as at 31st March 2012, the Profit and Loss account and also 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.

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

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

Further to our comments in the Annexure referred to 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 in so far as it appears from examination of those books

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

(iv) In our opinion, the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956

(v) In respect of nominee directors appointed by State Government and public financial institutions, the provisions of Section 274(1)(g) does not apply. In respect of directors other than those specified above, we report that, on the basis of written representations received from those directors and taken on record by the Board of Directors, none of them 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, they said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

(a) In the case of Balance Sheet, of the State of Affairs of the company as at 31st March 2012;

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

(c) In the case of Cash Flow Statement, of the Cash Flows for the year ended on that date.

For P.B. Vijayaraghavan & Co.

Chartered Accountants

Firm Registration No. 004721S

P.B. Srinivasan

Place - Chennai Partner

Date - 29th May 2012 Membership No. 203774

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

(b) Fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

(c) No substantial part of fixed assets has been disposed off during the year.

ii) (a) Physical verification of inventory has been conducted at reasonable intervals by the management;

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

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

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

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v) As per the information and explanation given to us, there are no contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that needs to be entered into the register maintained under the section.

vi) The company has not accepted any deposits from public during the year. Hence the provisions of section 58A, 58AA or other relevant provisions of the Companies Act, 1956 are not applicable.

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

viii) The Central Government has prescribed 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 books of accounts prescribed under the Cost Accounting Records (Paper) Rules, 1975, have been maintained by the company and the preformed specified therein for the year are under preparation. We have however not carried out a detailed verification of such records.

ix) (a) The company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor

Education and Protection Fund, Income-Tax, Sales-Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable were in arrears, for a period more than six months from the date they become payable. The Employees' State Insurance Act does not apply to the company.

(b) According to the information and explanations given to us, there are no dues of Sales Tax/Income Tax/Customs Duty/Wealth Tax/Service Tax/Excise Duty/Cess which have not been deposited on account of any dispute other than those given below:

Name of the Statute Nature of Period to which Amount Forum where the Dues the amount pertains (Rs.Lakhs) dispute is pending

Central Excise Act, 1944 Excise Duty Exemption 1997-1998 4.25 Tribunal Chennai and 1998-99

Cenvat Credit Rules, 2004 Input Credit Reversal 1997-1998 4.82 High Court

1998-1999 2.59

1999-2000 1.00

2000-2001 43.16

2001-2002 0.55

Cenvat Credit Rules, 2004 Capital Goods Credit 2003-2004 44.11 Tribunal Chennai

2004-2005 237.58

2005-2006 648.63

2006-2007 236.70

Cenvat Credit Rules, 2004 Input Service Credit 2006-07 14.01 Commissioner

2007-2008 15.95 Appeals

Cenvat Credit Rules, 2004 Capital Goods Credit 2006-07 5811.17 Tribunal Chennai

2007-08 3017.40

Cenvat Credit Rules, 2004 Input credit reversal on 2006-07 19.93 Tribunal Chennai effluent sludge waste 2007-08 27.83

2008-09 1793.31

2009-10 2715.40

Cenvat Credit Rules, 2004 Input Service Credit 2007-08 224.68 Tribunal Chennai

2008-09 580.23

Cenvat Credit Rules, 2004 Input Service Credit 2008-09 20.90 Tribunal Chennai

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09 7.68 High Court

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09 12.39 Tribunal Chennai

2009-10 10.93

Cenvat Credit Rules, 2004 Capital Goods Credit 2008-09 87.18 Commissioner Appeals

Cenvat Credit Rules, 2004 Capital Goods Credit 2009-10 300.40 Tribunal Chennai

Cenvat Credit Rules, 2004 Capital goods credit 2009-10 8505.25 Tribunal Chennai

2010-11 2014.39

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 2.98 Tribunal Chennai

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 3.56 High Court

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 4.00 Commissioner Appeals

Cenvat Credit Rules, 2004 Input credit reversal on 2010-11 654.65 Tribunal Chennai

effluent sludge waste

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 656.60 Tribunal Chennai

Cenvat Credit Rules, 2004 Input service credit 2010-11 12.02 Commissioner

2011-12 11.25 Appeals



Customs Act, 1962 Customs Duty 1991-92 44.34 Commissioner

Customs Act, 1962 Customs Duty 1997-98 54.81 Commissioner

Customs Act, 1962 Customs Duty 1999-00 126.74 Commissioner

Income Tax Act, 1961 Income Tax AY 2002-03 60.69 Assessing Officer

Income Tax Act, 1961 Income Tax AY 1996-97 244.47 Assessing Officer

to 2000-01 & 2003-04

Income Tax Act, 1961 Income Tax AY 1996-97 283.58 Commissioner

to 2000-01 & (Appeals)

2003-04

Income Tax Act, 1961 Income Tax AY 2003-04 96.43 High Court Chennai

Income Tax Act, 1961 Income Tax AY 2004-05 65.16 CIT (A) / Tribunal

Income Tax Act, 1961 Income Tax AY 2005-06 137.96 Assessing Officer

Income Tax Act, 1961 Income Tax AY 2006-07 41.18 Commissioner (Appeals)

Income Tax Act, 1961 Income Tax AY 2007-08 138.53 Commissioner (Appeals)

Income Tax Act, 1961 Income Tax AY 2008-09 65.54 Commissioner

(Appeals)

Income Tax Act, 1961 Income Tax AY 2009-10 1680.20 Commissioner

(Appeals)

Wealth Tax Act, 1957 Wealth Tax AY 1997-98 19.46 Assessing Officer

to 1999-2000

& 2001-02 to 2003-04

Total 30806.57

x) The Company does not have accumulated losses as at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

xi) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution, bank or debenture holders.

xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence the question of maintenance of documents and records does not arise.

xiii) The Company is not a chit fund or a nidhi / mutual benefit fund / society. Hence this clause is not applicable to the company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Hence this clause is not applicable to the company.

xv) The company has not given any guarantee for loans taken by others from banks or financial institutions based on the records produced to us.

xvi) According to the information and explanations given to us, the company has not utilized the term loan to the extent of Rs.89.37 crores for the purpose for which it has been obtained.

xvii) 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 investment.

xviii) According to the information and explanations given to us, during the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix) As per the information and explanation given to us, the company has not issued any debentures during the year. However, in respect of debentures outstanding at the end of the year, necessary security or charge has been created.

xx) The company has not raised any money through public issue. Hence the provisions of clause 4(xx) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

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

For P.B. Vijayaraghavan & Co.

Chartered Accountants

Firm Registration No. 004721S

P.B. Srinivasan

Partner

Membership No. 203774

Place - Chennai

Date - 29th May 2012


Mar 31, 2011

We have audited the attached Balance Sheet of TAMIL NADU NEWSPRINT AND PAPERS LIMITED, as at 31st March 2011, the Profit and Loss account and also 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.

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

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

Further to our comments in the Annexure referred to 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 in so far as it appears from examination of those books.

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

(iv) In our opinion, the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(v) In respect of nominee directors appointed by State Government and public financial institutions, the provisions of Section 274(l)(g) does not apply. In respect of directors other than those specified above, we report that, on the basis of written representations received from those directors and taken on record by the Board of Directors, none of them 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) As the Central Government is yet to notify Cess payable under Section 441A, the reporting requirement under Section 227(3)(g) of the Companies Act, 1956 does not arise.

(vii) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

(a) In the case of Balance Sheet, of the State of Affairs of the company as at 31st March 2011;

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

(c) In the case of 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,

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

(b) Fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

(c) No substantial part of fixed assets have been disposed off during the year.

ii) (a) Physical verification of inventory has been conducted at reasonable intervals by the management;

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

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

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

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v) As per the information and explanation given to us, there are no contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that needs to be entered into the register maintained under the section.

vi) The company has not accepted any deposits from public during the year. Hence the provisions of section 58A, 58AA or other relevant provisions of the Companies Act, 1956 are not applicable.

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

viii) The Central Government has prescribed the maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956 and we are of the opinion that prima facie, the books of accounts prescribed under the Cost Accounting Records (Paper) Rules, 1975, have been maintained by the company and the proforma specified therein for the year are under preparation. We have however not carried out a detailed verification of such records.

ix) (a) The company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income-Tax, Sales-Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable were in arrears, for a period more than six months from the date they become payable. The Employees' State Insurance Act does not apply to the company.

(b) According to the information and explanations given to us, there are no dues of Sales Tax/Income Tax/Customs Duty/Wealth Tax/Service Tax/Excise Duty/Cess which have not been deposited on account of any dispute other than those given below:

Name of the Statute Nature of Period to which Amount Forum where the Dues the amount pertains (Rs.Lakhs) dispute is pending

Central Excise Act, 1944 Excise duty exemption 1997-1998, 4.25 Tribunal, Chennai 1998-1999

Cenvat Credit Rules, 2004 Input credit reversal 1997-98, 1998-99 50.17 High Court, Chennai.

1999-2000, 2000-01 2001-02

Cenvat Credit Rules, 2004 Capital goods credit 2003-04, 2004-05, 1093.07 Tribunal,Chennai. 2006-07, 2007-08

Cenvat Credit Rules, 2004 Input service credit 2005-06, 2006-07 17.50 Tribunal,Chennai.

Cenvat Credit Rules, 2004 Input service credit 2006-07, 2007-08 30.43 Commissioner (Appeals)

Cenvat Credit Rules, 2004 Capital goods credit 2006-07, 2007-08 8257.53 Tribunal,Chennai.

Cenvat Credit Rules, 2004 Input service credit 2007-08, 2008-09 768.44 Tribunal,Chennai.

Cenvat Credit Rules, 2004 Capital goods credit 2008-09, 2009-10 20.43 Tribunal,Chennai.

Cenvat Credit Rules, 2004 Capital goods credit 2008-09 77.89 Commissioner (Appeals)

Cenvat Credit Rules, 2004 Capital goods credit 2009-10 268.72 Tribunal,Chennai.

Cenvat Credit Rules, 2004 Input service credit 2009-10, 2010-11 6.87 Commissioner (Appeals)

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 2.57 Tribunal,Chennai.

Cenvat Credit Rules, 2004 Capital goods credit 2010-11 3.08 Commissioner (Appeals)

Customs Act, 1962 Custom Duty 1991-92 44.34 Commissioner

Customs Act, 1962 Custom Duty 1997-98 54.81 Commissioner

Customs Act, 1962 Custom Duty 1999-00 126.74 Commissioner

Income-tax Act, 1961 Income-tax AY 2002-03 60.69 Assessing Officer

Income-tax Act, 1961 Income-tax AY 1996-97 to 244.47 Assessing Officer 2000-01 & 2003-04

Income-tax Act, 1961 Income-tax AY -1996-97 to 283.58 Commissioner (Appeals) 2000-01 & 2003-04

Income-tax Act, 1961 Income-tax AY 2003-04 72.29 High Court, Chennai

Income-tax Act, 1961 Income-tax AY 2004-05 56.46 Tribunal,Chennai

Income-tax Act, 1961 Income-tax AY 2005-06 137.96 Commissioner (Appeals)

Income-tax Act, 1961 Income-tax AY 2006-07 5.97 Tribunal,Chennai

Income-tax Act, 1961 Income-tax AY 2008-09 9.09 Commissioner (Appeals)

Wealth Tax Act, 1957 Wealth Tax AY 1997-98, 19.46 Assessing Officer 1998-99, 1999-00, 2001-02, 2002-03, 2003-04

x) The Company does not have accumulated losses as at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

xi) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution, bank or debenture holders.

xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence the question of maintenance of documents and records does not arise.

xiii) The Company is not a chit fund or a nidhi / mutual benefit fund / society. Hence this clause is not applicable to the company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Hence this clause is not applicable to the company.

xv) The company has not given any guarantee for loans taken by others from banks or financial institutions based on the records produced to us.

xvi) According to the information and explanations given to us, the company has not utilized the term loan to the extent of Rs.37.58 crores for the purpose for which it has been obtained.

xvii) 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 investment.

xviii) According to the information and explanations given to us, during the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix) As per the information and explanation given to us, the company has not issued any debentures during the year. However, in respect of debentures outstanding at the end of the year, necessary security or charge has been created.

xx) The company has not raised any money through public issue. Hence the provisions of clause 4(xx) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

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

For P.B. Vijayaraghavan & Co.

Chartered Accountants

Firm Registration No. 004721S

P.B. Srinivasan

Place - Chennai Partner

Date - 27th May 2011 Membership No. 203774








Mar 31, 2010

1. We have audited the attached Balance Sheet of TAMILNADU NEWSPRINT AND PAPERS LIMITED as at 31st March 2010, the Profit and Loss Account and also 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 and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) order, 2003, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act 1956, we enclose in the Annexure, a statement on the matters specified in paragraph 4 of the said order.

4. Further to our comments in the Annexure referred to 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 purpose of our audit.

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

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

(iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(v) In respect of nominee directors appointed by State Government and public financial institutions, the provisions of Section 274(l)(g) does not apply. In respect of directors other than those specified above, we report that, on the basis of written representations received from those directors and taken on record by the Board of Directors, none of them 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) As the Central Government is yet to notify Cess payable under Section 441A, the reporting requirement under Section 227(3)(g) of the Companies Act, 1956 does not arise.

(vii) In our opinion, and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the State of Affairs of the Company as at 31st March 2010;

(b) in the case of the Profit & Loss Account of the PROFIT for the year ended on that date; and

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

ANNEXURE TO THE AUDITORS REPORT REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

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

b) Fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

c) No Substantial part of the fixed assets have been disposed off during the year.

ii) a) Physical verification of Inventory has been conducted at reasonable intervals by the management.

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

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

iii) 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) The company has not taken any loans, secured or unsecured from companies, firms or.other parties covered in the register maintained under section 301 of the Companies Act, 1956.

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v) As per the information and explanation given to us, there are no contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that needs to be entered into the register maintained under the section.

vi) The company has not accepted any deposits from public during the year. Hence the provisions of sections 58A, 58AA or other relevant provisions of the Companies Act, 1956 are not applicable.

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

viii) The Central Government has prescribed the maintenance of records under Section 209 (1) (d) of the Companies Act, 1956 and we are of the opinion that, prima facie, the books of accounts prescribed under the Cost Accounting Records (Paper) Rules, 1975, have been maintained by the Company and the proforma specified therein for the year are under preparation. We have however not carried out a detailed verification of such records.

ix) a) The Company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable were in arrears, for a period more than six months from the date they become payable. The Employees State Insurance Act does not apply to the company.

b) According to the information and explanations given to us, there are no dues of Sales Tax/Income Tax/ Customs Duty/Wealth Tax/Service Tax/Excise Duty/ Cess which have not been deposited on account of any dispute other than the following:

SI. Nature of Amount Forum where dispute

No. Dues Rs. lakh is pending

1 Income Tax 4250.96 Commissioner of Income Tax (Appeals)

2 Income Tax 16.48 Assessing Officer

3 Wealth Tax 19.46 Wealth Tax Assessing Authorities

4 Central Excise 48.76 Honble Madras and Service High Court Tax 5 Central Excise 9615.69 CESTAT and Service Tax

6 Central Excise 57.43 Commissioner Appeals and Service Tax

7 Customs Duty 8.68 Honble Madras High Court

8 Customs Duty 262.53 Customs Assessment Authorities

Total 14279.99

x) The Company does not have accumulated losses as at the end of the financial year and has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

xi) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution, bank or debenture holders.

xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence the question of maintenance of documents and records does not arise.

xiii) The company is not a chit fund or a nidhi/mutual benefit fund/society. Hence this clause is not applicable to the Company.

xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Hence this clause is not applicable to the company.

xv) The company has not given any guarantee for loans taken by others from banks or financial institutions based on the records produced to us.

xvi) In our opinion, the term loans have been applied for the purpose for which they were raised.

xvii) During the year, the company has temporarily utilized short term loan funds to the extent of Rs.S0.67 Crore for long term purpose (Funding Mill Expansion Plan).

xviii) According to the information and explanations given to us, during the year the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix) The Company has issued Non-convertible Debentures of Rs. 50 Crore during the financial year 2009-10 and Rs. 100 Crore during the financial year 2008-09 for which the Company has created necessary security or charge.

xx) The Company has not raised any money through public issue. Hence the provisions of clause 4(xx) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

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

For P.B. Vijayaraghavan & Co

Chartered Accountants

Firm Registration No. 004721S

P B Srinivasan

Partner

Membership No. 203774

Place : Chennai

Date : 25th May 2010



 
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