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Auditor Report of Visaka Industries Ltd.

Mar 31, 2017

Independent Auditors'' Report

To

The Members of Visaka Industries limited

Report on the Financial Statements

We have audited the accompanying financial statements of Visaka Industries limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2017, 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 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 and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2017, and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("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, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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

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

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

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

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

(e) On the basis of the written representations received from the directors as on 31st March, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B".

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

i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 35 to the financial statements;

ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

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

iv) The Company has provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and these are in accordance with the books of accounts maintained by the Company. Refer Note 38 to the financial statements.

The Annexure referred to in our report to the members of the Company for the year ended on 31st March, 2017. We report that:

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

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

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii) The inventories have been physically verified during the year by the management. The discrepancies noticed on verification between the physical stocks and book records were not material.

(iii) The company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, paragraph 3 (iii) (a) to (c) of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Act, with respect to loans, investments, guarantees and securities made.

(v) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under, in respect of deposits accepted. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.

(vi) We have broadly reviewed the cost records maintained by the Company as prescribed under sub-section (1) of section 148 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained.

Name of the Statute

Nature of dues

Amount (Rs, in Lakhs)

Period to which the amount relates

Forum where dispute is pending

Income-Tax Act, 1961

Income Tax

11.99

2007-08

CIT (Appeals) Hyderabad

Income-Tax Act, 1961

Income Tax

24.23

2008-09

CIT (Appeals) Hyderabad

Income-Tax Act, 1961

Income Tax

6.79

2010-11

CIT (Appeals) Hyderabad

Income-Tax Act, 1961

Income Tax

9.41

2011-12

CIT (Appeals) Hyderabad

Income-Tax Act, 1961

Income Tax

13.44

2009-10

CIT (Appeals) Hyderabad

Central Excise Act, 1944

Excise Duty

873.85

2003-04 & 2004-05

CESTAT, Chennai

Central Excise Act, 1944

Penalty

1323.85

2003-04 & 2004-05

CESTAT, Chennai

Central Excise Act, 1944

Excise Duty

14.86

August.13 to January.16

Asst Commissioner Central Excise Pune

Customs, Central Excise & Service Tax Drawback Rules, 1995

Duty Draw Back

152.10

July 2009 to March 2011

Joint Secretary, Revisionary Authority, New Delhi.

Central Sales Tax Act, 1956

Central Sales Tax

9.02

2008-09

Telangana VAT Appellate Tribunal, Hyderabad

Central Sales Tax Act, 1956

Central Sales Tax

7.92

2008-09

Commercial Taxes Tribunal Lucknow

Bihar VAT Act 2005

VAT/Interest

3.77

2005-06

Joint Commissioner (Appeals)

Orissa VAT Act, 2004

VAT/Penalty

10.97

October 2009 to March 2011

Orissa Sales Tax Tribunal, Bhubaneswar

Karala VAT Act,2003

VAT/Interest

0.23

2010-11

Deputy Commissioner (Appeals),Commercial Taxes, Ernakulam

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, value added tax, wealth tax, service tax, customs duty, excise duty, cess and any other statutory dues as applicable with the appropriate authorities and there were no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and records of the Company examined by us, the particulars of income tax, sales tax, valued added tax, wealth tax, service tax, customs duty, excise duty or cess as at 31st March, 2017 which have not been deposited on account of any dispute pending, are as under:

(viii) The Company has not defaulted in repayment of loans or borrowing to a financial institution, banks and Governments.

Name of the Statute

Nature of dues

Amount (Rs, in Lakhs)

Period to which the amount relates

Forum where dispute is pending

Jharkhand VAT Act,2005

VAT/Penalty

20.38

2010-11

Commissioner of Commercial Taxes Ranchi

Orissa Entry Tax Act 1999

Entry Tax/Penalty

10.38

October 2009 to March 2011

Orissa Sales Tax Tribunal, Bhubaneswar

(ix) The Company did not raise any money by way of initial public offer or further public offer during the year. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained other than amounts temporarily invested pending utilization of the funds for the intended use.

(x) To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3 (xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with section 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into any noncash transactions with directors or persons connected with him. Accordingly, paragraph 3 (xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Visaka Industries Limited ("the Company") as of 31st March 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (''ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For M.Anandam & Co.

Chartered Accountants

(Firm''s Registration No. 000125S)

A.V.Sadasiva

Place: Secunderabad Partner

Date: 5th May, 2017 Membership No.018404


Mar 31, 2016

Independent Auditors'' Report

To

The Members of visaka Industries Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Visaka Industries limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2016, 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 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 and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

auditor''s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2016, and its profit and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order,

2016 ("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 a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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

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

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

(c) The Balance Sheet, the Statement of Profit and Loss,

and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

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

(e) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B".

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

according to the explanations given to us:

i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 34 to the financial statements;

ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

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

(i) (a) The Company has maintained proper records

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

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

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii) The inventories have been physically verified during the year by the management. The discrepancies noticed on verification between the physical stocks and book records were not material.

(iii) The company has not granted any loans, secured or unsecured to companies, firms, Limited Liability

Partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, paragraph 3 (iii) (a) to (c) of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Act, with respect to loans, investments, guarantees and securities made.

(v) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under, in respect of deposits accepted. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.

(vi) We have broadly reviewed the cost records maintained by the Company as prescribed under sub-section (1) of section 148 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained.

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, value added tax, wealth tax, service tax, customs duty, excise duty, cess and any other statutory dues as applicable with the appropriate authorities and there were no

Name of the statute

nature of the Dues

amount (I in lakhs)

period to which the amount relates

forum where dispute is pending

Income-Tax Act, 1961

Income Tax

9.72

2009-10

CIT (Appeals), Hyderabad

Central Excise Act, 1944

Excise Duty

873.85

2003-04 & 2004-05

CESTAT, Chennai

Central Excise Act, 1944

Penalty

1323.85

2003-04 & 2004-05

CESTAT, Chennai

Customs, Central Excise & Service Tax Drawback Rules, 1995

Duty Draw Back

152.10

July 2009 to March 2011

Joint Secretary, Revisionary Authority, New Delhi.

Central Sales Tax Act, 1956

Central Sales Tax

9.02

2008-09

Telangana VAT Appellate Tribunal, Hyderabad

Central Sales Tax Act, 1956

Central Sales Tax

7.92

2008-09

Commercial Taxes Tribunal, Lucknow

Central Sales Tax Act, 1956

Central Sales Tax

0.54

October 2009 to March, 2011

Additional Commissioner of Sales Tax, Bhubaneswar

Central Sales Tax Act, 1956

Central Sales Tax/ Penalty

3.21

2012-13 & 2013-14

Additional Commissioner of Sales Tax, Bhubaneswar

West Bengal VAT Act, 2003

Value Added Tax

137.20

2011-12

Joint Commissioner of Commercial Taxes, Midnapur

Bihar VAT Act, 2005

VAT/Interest

3.77

2005-06

Joint Commissioner (Appeals), Patna

Orissa VAT Act, 2004

VAT/Penalty

10.97

October 2009 to March 2011

Orissa Sales Tax tribunal,Bhubaneswar

Karala VAT Act, 2003

VAT/Interest

2.29

2015-16

Deputy Commissioner (Appeals),Commercial Taxes,Ernakulam

Karala VAT Act, 2003

VAT/Interest

0.83

2009-10

Deputy Commissioner (Appeals),Commercial Taxes,Ernakulam

Karala VAT Act, 2003

VAT/Interest

0.85

2010-11

Deputy Commissioner (Appeals),Commercial Taxes,Ernakulam

Jharkhand VAT Act, 2005

VAT/Penalty

20.38

2010-11

Commissioner of Commercial Taxes, Ranchi.

arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and records of the Company examined by us, the particulars of income tax, sales tax, valued added tax, wealth tax, service tax, customs duty, excise duty or cess as at 31st March, 2016 which have not been deposited on account of any dispute pending, are as under:

(viii) The Company has not defaulted in repayment of loans or borrowing to a financial institution, banks and Governments.

name of the statute

nature of the dues

amount (I in lakhs)

period to which the amount relates

forum where dispute is pending

Orissa Entry Tax Act 1999

Entry Tax/Penalty

10.38

October 2009 to March 2011

Orissa Sales Tax Tribunal, Bhubaneswar

Orissa Entry Tax Act 1999

Entry Tax/Penalty

3.33

2012-13 &2013-2014

Additional Commissioner of Sales Tax, Bhubaneswar

(ix) The Company did not raise any money by way of initial public offer or further public offer during the year. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained other than amounts temporarily invested pending utilization of the funds for the intended use.

(x) To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

(xi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3 (xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the

We have audited the internal financial controls over financial reporting of Visaka Industries Limited ("the Company") as of 31 March 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

management''s responsibility for internal financial controls

The Company''s management is responsible for establishing

Company, transactions with the related parties are in compliance with section 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into any noncash transactions with directors or persons connected with him. Accordingly, paragraph 3 (xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (''ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

auditors'' responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

meaning of internal financial controls over financial reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

inherent limitations of internal financial controls over financial reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

for mAnandarn & co.

Chartered Accountants

(Firm''s Registration No. 000125S)

A.V.Sadasiva

Place: Secunderabad Partner

Date: 10th May, 2016 M.No.018404


Mar 31, 2015

We have audited the accompanying financial statements of Visaka Industries Limited ("the Company"), 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 Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

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

(e) On the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

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

i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 36 to the financial statements;

ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

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

Annexure to the Auditors' Report

The Annexure referred to in our report to the members of the Company for the year ended on 31st March, 2015. We report that:

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

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

(ii) (a) The inventories have 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 its inventories. The discrepancies noticed on verification between the physical stocks and book records were not material.

(iii) 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 Act.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

(v) In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under, in respect of deposits accepted. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.

(vi) In our opinion and according to the information and explanations given to us, the Company has made and maintained accounts and records prescribed by the Central Government under sub-section (1) of section 148 of the Act.

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is regular in depositing undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, value added tax, wealth tax, service tax, customs duty, excise duty, value added tax, cess and any other statutory dues as applicable with the appropriate authorities and there were no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and records of the Company examined by us, the particulars of income tax, sales tax, valued added tax, wealth tax, service tax, customs duty, excise duty or cess as at 31st March, 2015 which have not been deposited on account of any dispute pending, are as under:

Name of the Statute Nature of the Amount Dues (Rs. In Lakhs)

Income-Tax Act, 1961 Income Tax 9.72

Central Excise Act, Excise Duty 873.85 1944

Central Excise Act, Penalty 1323.85 1944

Central Sales Tax Act, Central Sales Tax 9.02 1956

Central Sales Tax Act, Central Sales Tax 8.80 1956

West Bengal VAT Act, VAT 137.20 2003

Bihar VAT Act, 2005 VAT/Interest 3.77

Central Sales Tax Act, Central Sales Tax/ 0.54 1956 Penalty

Orissa VAT Act, 2004 VAT/Penalty 55.30

Service Tax Service Tax 1.76 (Finance Act, 1994)

Service Tax Service Tax 1.67 (Finance Act, 1994)

Service Tax Service Tax 2.09 (Finance Act, 1994)

Service Tax Service Tax 1.64 (Finance Act, 1994)

Customs, Central Duty Draw Back 152.10 Excise & Service Tax Drawback Rules, 1995

Orissa Entry Tax Act Entry Tax/Penalty 16.38 1999

Name of the Statute Period to which the amount relates

Income-Tax Act, 1961 2009-10

Central Excise Act, 2003-04 &2004-05 1944

Central Excise Act, 2003-04 &2004-05 1944

Central Sales Tax Act, 2008-09 1956

Central Sales Tax Act, 2008-09 1956

West Bengal VAT Act, 2011-12 2003

Bihar VAT Act, 2005 2005-06

Central Sales Tax Act, October 2009 to March, 2011 1956

Orissa VAT Act, 2004 October 2009 to March 2011

Service Tax January 2005 To September (Finance Act, 1994) 2005

Service Tax October 2005 To March 2006 (Finance Act, 1994)

Service Tax April 2006 To September 2006 (Finance Act, 1994)

Service Tax October 2006 to February 2007 (Finance Act, 1994)

Customs, Central July 2009 to March 2011 Excise & Service Tax Drawback Rules, 1995

Orissa Entry Tax Act October 2009 to March 2011 1999

Name of the Statute Forum where dispute is pending

Income-Tax Act, 1961 CIT (Appeals)

Central Excise Act, CESTAT, Chennai 1944

Central Excise Act, CESTAT, Chennai 1944

Central Sales Tax Act, Telangana VAT Appellate Tribunal, 1956 Hyderabad

Central Sales Tax Act, Additional Commissioner of 1956 Commercial Taxes(Appeal),Lucknow

West Bengal VAT Act, Joint Commissioner of Commercial 2003 Taxes, Midnapur.

Bihar VAT Act, 2005 Joint Commissioner (Appeals)

Central Sales Tax Act, Additional Commissioner of Sales 1956 Tax, Bhubaneswar

Orissa VAT Act, 2004 Additional Commissioner of Sales Tax, Bhubaneswar

Service Tax High Court, Nagpur (Finance Act, 1994)

Service Tax High Court, Nagpur (Finance Act, 1994)

Service Tax Bhandara Division, Nagpur (Finance Act, 1994)

Service Tax Bhandara Division, Nagpur (Finance Act, 1994)

Customs, Central Joint Secretary, Revisionary Excise & Service Tax Authority, New Delhi. Drawback Rules, 1995

Orissa Entry Tax Act Additional Commissioner of Sales 1999 Tax, Bhubaneswar

(c) According to the information and explanations given to us the amounts which were 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 have been transferred to such fund within time.

(viii) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(ix) The Company has not defaulted in repayment of dues to a financial institutions or banks.

(x) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xi) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained other than amounts temporarily invested pending utilization of the funds for the intended use.

(xii) To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For M.Anandam & Co.

Chartered Accountants (Firm's Registration No. 000125S)

A.V.Sadasiva Place: Secunderabad Partner Date: 7th May, 2015 M.No.018404


Mar 31, 2014

We have audited the accompanying financial statements of Visaka Industries Limited ("the Company"), 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 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 general circular 8/2014, dated 4th April, 2014 issued by Ministry Corporate Affairs. 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 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") 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 sub-section (3C) of section 211 of the Companies Act, 1956 read with general circular 8/2014, dated 4th April, 2014 issued by Ministry Corporate Affairs.

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 Re: Visaka Industries Limited Referred to in Paragraph 1under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date i. a. The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

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

c. The Company has not disposed off any substantial part of its fixed assets so as to affect its going concern status.

ii. a. The inventories have 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 its inventories. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii. a. The Company has not granted any loans to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

b. The Company has taken unsecured loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was H140.16 Lakhs and the year-end balance of loans taken is H9.16 Lakhs.

c. In our opinion, the rate of interest and other terms and conditions on which loans have been taken from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie prejudicial to the interest of the Company.

d. The Company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest.

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

v. a. According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion and according to the information and explanations given to us, the company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under, where applicable have been complied with. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii. In our opinion and according to the information and explanations given to us, the Company has made and maintained accounts and records prescribed by the Central Government under section 209 (1) (d) of the Companies Act, 1956.

ix. a. According to the information and explanations given to us and the records of the company examined by us, the Company is regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income- tax, wealth-tax, service tax, sales tax, custom duty, excise duty, cess and other statutory dues as applicable with the appropriate authorities and there were no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us and records of the Company examined by us, the particulars of sales tax, income tax, customs duty, excise duty, service tax and wealth tax, as at 31st March, 2014 which have not been deposited on account of dispute pending, are as under:

Name of the Statute Nature of the Dues Amount (Rs. In Lakhs)

Income-Tax Act, 1961 Income Tax 9.72

Central Excise Act, 1944 Excise Duty 873.85

Central Excise Act, 1944 Penalty 1323.85

Central Sales Tax Act, Central Sales Tax 3.23 1956

Central Sales Tax Act, Central Sales Tax 8.80 1956

Central Sales Tax Act, Central Sales Tax/ 1.76 1956 Penalty

Bihar VAT Act, 2005 VAT/Interest 3.77

Bihar VAT Act, 2005 VAT/Interest 0.84

Orissa VAT Act, 2004 VAT/Penalty 4.02

Orissa VAT Act, 2004 VAT/Penalty 55.30

Service Tax Service Tax 1.76 (Finance Act, 1994)

Service Tax Service Tax 1.67 (Finance Act, 1994)

Service Tax Service Tax 2.09 (Finance Act, 1994)

Service Tax Service Tax 1.64 (Finance Act, 1994)

Customs, Central Excise Duty Draw Back 152.10 & Service Tax Drawback Rules, 1995

Orissa Entry Tax Act 1999 Entry Tax/Penalty 16.38

Name of the Statue Period to which the Forum where amount relates dispute is pending

Income-Tax Act, 1961 2009-10 Income Tax Appellate Tribunal, Hyderabad Central Excise Act, 1944 2003-04 & 2004-05 CESTAT, Chennai

Central Excise Act, 1944 2003-04 & 2004-05 CESTAT, Chennai

Central Sales Tax Act, 1956 2008-09 Appellate Deputy Commissioner (CT), Hyderabad

Central Sales Tax Act, 1956 2008-09 Additional Commissioner of Commercial Taxes(Appeal),Lucknow

Central Sales Tax Act, 1956 2006-07, 2007-08 Additional Commissioner of Sales and 2009-11 Tax, Bhubaneswar

Bihar VAT Act, 2005 2005-06 Joint Commissioner (Appeals)

Bihar VAT Act, 2005 2006-07 Joint Commissioner of Commercial Taxes (Patna)

Orissa VAT Act, 2004 April 2005 to Additional Commissioner of Sales September 2009 Tax, Bhubaneswar

Orissa VAT Act, 2004 October 2009 to Additional Commissioner of Sales March 2011 Tax, Bhubaneswar

Service Tax (Finance Act, 1994) January 2005 To High Court, Nagpur September 2005

Service Tax (Finance Act, 1994) October 2005 to High Court, Nagpur March 2006

Service Tax (Finance Act, 1994) April 2006 to Bhandara Division, Nagpur September 2006

Service Tax (Finance Act, 1994) October 2006 to Bhandara Division, Nagpur February 2007

Customs, Central Excise & Service Tax Drawback Rules, 1995 July 2009 to Joint Secretary, Revisionary March 2011 Authority, New Delhi

Orissa Entry Tax Act 1999 October 2009 to Additional Commissioner of Sales March 2011 Tax, Bhubaneswar

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

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

xii. According to information and explanations given to us and based on the documents and records produced to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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

xiv. In our opinion and according to the information and explanation given to us, the Company is not dealing 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.

xv. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions. Accordingly, the provisions of clause 4(xv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xvi. In our opinion and according to the information and explanation given to us, the term loans have been applied for the purpose for which they were raised other than amounts temporarily invested pending utilization of the funds for the intended use.

xvii. In our opinion and according to the information and explanation 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.

xviii. The Company has not made any preferential allotment of shares during the year to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised any funds on public issue and hence disclosure on the end use of money raised by the public issue is not applicable to the Company.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For M. Anandam& Co.,

Chartered Accountants

(Firm Regn.No.000125S)

A.V.Sadasiva Place: Secunderabad Partner

Date: 24th May, 2014 M.No.018404


Mar 31, 2013

We have audited the accompanying financial statements of Visaka ndustries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, 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 n 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 nformation 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 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") 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 sub-section (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

Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date

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

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

c. The Company has not disposed off any substantial part of its fixed assets so as to affect its going concern status

i. a. The inventories have 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 its nventories. The discrepancies noticed on verification between the physical stocks and the book records were not material

i a. The Company has not granted any loans to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

b. The Company has taken unsecured loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during theyearwasRs.618.39 Lakhs and the year-end balance of loans taken is Rs.133.39 Lakhs.

c. In our opinion, the rate of interest and other terms and conditions on which loans have been taken from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie prejudicial to the nterest of the Company.

d. The Company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest.

iv. In our opinion and according to the information and explanations given to us, there is an adequate interna control system 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. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas

v. a. According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion and according to the information and explanations given to us, the company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under, where applicable have been complied with. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal

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

viii. In our opinion and according to the information and explanations given to us, the Company has made and maintained accounts and records prescribed by the Centra Government under section 209 (1) (d) of the Companies Act, 1956.

ix. a. According to the information and explanations given to us and the records of the company examined by us, the Company is regular in depositing undisputed statutory dues ncluding provident fund, investor education and protection fund, employees'' state insurance, income-tax, wealth-tax, service tax, sales tax, custom duty, excise duty, cess and other statutory dues as applicable with the appropriates authorities and there were no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us and records of the Company examined by us, the particulars of sales tax, income tax, customs duty, excise duty, service tax and wealth tax, as at 31st March, 2013 which have not been deposited on account of dispute pending, are as under:

Amount Name of the Statute Nature of the Dues (Rs. In lakhs)

Income-Tax Act, 1961 Income Tax 17.46

Income-Tax Act, 1961 Income Tax 21.76

Central Excise Act, 1944 Excise Duty 873.85

Central Excise Act, 1944 Penalty 1323.85

Central Sales Tax Act, 1956 Central Sales Tax 3.23

Bihar VAT Act, 2005 VAT 12.45

Bihar VAT Act, 2005 VAT 12.36

West Bengal VAT Act, 2003 VAT/lnterest 13.23

Central Sales Tax Act, 1956 Central Sales Tax 2.13

Bihar VAT Act, 2005 VAT/lnterest 3.77

Orissa VAT Act, 2004 VAT/Penalty 4.02

Central Sales Tax Central Sales Tax Act, 1956 1.22 Penalty

Service Tax Service Tax 1.76 (Finance Act, 1994)

Service Tax Service Tax 1.67 (Finance Act, 1994)

Service Tax Service Tax 2.09 (Finance Act, 1994)

Service Tax Service Tax 1.64 (Finance Act, 1994)

Customs, Central Excise S Service Duty Draw Back 152. Tax Drawback Rues, 1995

Name Period to which the Forum where dispute is amount relates pending

Income-Tax Act, 1961 2008-09 CIT (Appeals)

Income-Tax Act, 1961 2009-10 CIT (Appeals)

Central Excise Act, 1944 2003-04 & 2004-05 CESTAT, Chennai

Central Excise Act, 1944 2003-04 & 2004-05 CESTAT, Chennai

Central Excise Act, 1944 Appellate Deputy 2008-09 Commissioner (CT), Hyderabad

Bihar VAT Act, 2005 Joint Commissioner 2007-08 of Commercial Taxes (Appeal), Patna

Bihar VAT Act, 2005 Joint Commissioner 2006-07 of Commercial Taxes (Appeal), Patna

Bihar VAT Act, 2005 Senior Joint Commissioner, 2006-07 Midnapur

Bihar VAT Act, 2005 Joint Commissioner, 2006-07 Midnapur

Central Excise Act, 1944 Joint Commissioner 2005-06 (Appeals)

Central Excise Act, 1944 April 2005 to Septembe Additional Commissioner 2009 of Sales Tax, Bhubaneswar

Additional Commissioner Central Excise Act, 1944 2006-07 and 2007-08 of Sales Tax, Bhubaneswar

Service Tax January 2005 To High Court, September 2005 Nagpur

Service Tax October 2005 To March .

x. The company has no accumulated losses and it has not ncurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

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

xii. According to information and explanations given to us and based on the documents and records produced to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities

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

xiv. In our opinion and according to the information and explanation given to us, the Company is not dealing 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.

xv. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from banks or financial nstitutions. Accordingly, the provisions of clause 4(xv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

xvi. In our opinion and according to the information and explanation given to us, the term loans have been applied for the purpose for which they were raised other than amounts temporarily invested pending utilization of the funds for the ntended use.

xvii. In our opinion and according to the information and explanation 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

xviii. The Company has not made any preferential allotment of shares during the year to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised any funds on public issue and hence disclosure on the end use of money raised by the public issue is not applicable to the Company.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year. For M. Anandam &Co., Chartered Accountants

(Firm Regn.No.000125S)

A.V.Sadasiva

Place: Secunderabad Partner

Date: 20th May, 2013 M.No.18404


Mar 31, 2011

1. We have audited the attached Balance Sheet of Visaka Industries Limited, as at 31st March, 2011, the Profit & 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.

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

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our Comments in the annexure referred to in paragraph 3 above, we report that;

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

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

d) In our opinion the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt by this report comply with the accounting standards referred to in Section 211(3C) of the Companies Act, 1956;

e) 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;

f) 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;

i. in the case of the Balance Sheet, of the State of Affairs of the company as at 31st March, 2011;

ii. in the case of the Profit & Loss account, of the Profit of the Company for the year ended on that date; and

iii. in the case of the Cash Flow statement, of the Cash Flows for the year ended on that date.

Annexure Re: Visaka Industries Limited Referred to in Paragraph 3 of our report of even date

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

b. According to the information and explanations given to us, the company has a phased programme of verification of fixed assets that is reasonable having regard to the size of the company and the nature of its business.

c. The Company has not disposed of any substantial part of its fixed assets so as to affect its going concern status.

ii. 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 its inventories. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii. a. The Company has taken an unsecured loans from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.1082.50 Lakhs and the year-end balance of loans taken is Rs.467.06 Lakhs. The Company has not granted loan to any party covered in the register maintained under section 301 of the Companies Act, 1956.

b. b. In our opinion, the rate of interest and other terms and conditions on which loans have been taken from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie prejudicial to the interest of the Company.

c. The Company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest.

d. There is no overdue amount of loans taken from the Company listed 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 is an adequate internal control system 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. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. a. According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. i. In our opinion and according to the information and explanations given to us, the company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under, where applicable have been complied with. We

are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii. In our opinion and according to the information and explanations given to us, the Company has made and maintained accounts and records prescribed by the Central Government under section 209(1) (d) of the Companies Act, 1956 in respect of textile division.

ix. a. According to the information and explanations given to us and the records of the company examined by us, the Company is regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales tax, custom duty, excise duty, cess and other statutory dues as applicable with the appropriates authorities and there were no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us and records of the Company examined by us, the particulars of sales tax, income tax, customs duty, excise duty, service tax and wealth tax, as at 31st March, 2011 which have not been deposited on account of dispute pending, are as under:

Name of the Statute Nature of Amount the Dues (Rs. in lakhs)

Income-Tax Act, 1961 Income Tax 2.34

Income-Tax Act, 1961 Income Tax 39.41

Central Excise Act, 1944 Excise Duty 1323.85

Central Excise Act, 1944 Penalty 1323.85

Sales Tax Act – State of Bihar VAT/Interest/ 10.93 Penalty

Central Sales Tax Act, 1956 Central Sales Tax 3.23

Service Tax (Finance Act, 1994) Service Tax 1.76

Service Tax (Finance Act, 1994) Service Tax 1.67

Service Tax (Finance Act, 1994) Service Tax 2.09

Service Tax Service Tax 1.64 (Finance Act, 1994)

Name of the Statute Period to which Forum where dispute the amount relates is pending

Income-Tax Act, 1961 F.Y 2002-2003 DCIT

Income-Tax Act, 1961 F.Y 2007-08 CIT (Appeals)

Central Excise Act, 1944 F.Y 2003-04 & 2004-05 CESTAT, Chennai

Central Excise Act, 1944 F.Y 2003-04 & 2004-05 CESTAT, Chennai

Sales Tax Act - State of Bihar F.Y 2005-06 Joint Commissioner (Appeals)

Central Sales Tax Act, 1956 F.Y 2008-09 Deputy Commissioner (CT) Hyderabad

Service Tax (Finance Act, 1994) January 2005 To High Court September 2005

Service Tax (Finance Act, 1994) October 2005 To High Court March 2006

Service Tax (Finance Act, 1994) April 2006 To Bhandara Division, September 2006 Nagpur

Service Tax (Finance Act, 1994) October 2006 to Bhandara Division, February 2007 Nagpur

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

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

xii. According to information and explanations given to us and based on the documents and records produced to us, the Company has maintained adequate documents and records in respect of loans and advances granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

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

xiv. In our opinion and according to the information and explanation given to us, the Company is not dealing 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.

xv. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions. Accordingly, the provisions of clause 4(xv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company.

xvi. In our opinion and according to the information and explanation given to us, the term loans have been applied for the purpose for which they were raised other than amounts temporarily invested pending utilization of the funds for the intended use.

xvii. In our opinion and according to the information and explanation 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.

xviii. The Company has not made any preferential allotment of shares during the year to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised any funds on public issue and hence disclosure on the end use of money raised by the public issue is not applicable to the Company.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, financial misappropriation of Rs.16 Lakhs by an employee of the Company has been brought to the notice of the Company during the year under audit and the amount recovered through possession of employee's property which is estimated to cover the misappropriation.

For M. Anandam & Co., Chartered Accountants

A.V.Sadasiva Partner M.No.18404 Firm Regn. No.000125S

Place: Secunderabad Date : 27th May, 2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of Visaka Industries Limited, as at 31st March, 2010, the Profit & 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we annex hereto a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our Comments in the annexure referred to in paragraph 3 above, we report that;

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

c) The Balance Sheet, Profit and Loss account and Cash

Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt by this report comply with the accounting standards referred to in Section 21 1 (3C) of the Companies Act, 1 956;

e) 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, 1 956;

f) 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, 1 956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

i. in the case of the Balance Sheet, of the State of Affairs of the Company as at 31 st March, 201 0;

ii. in the case of the Profit & Loss account, of the Profit of the Company for the year ended on that date; and

iii. in the case of the Cash Flow statement, of the Cash Flows for the year ended on that date.



Referred to in Paragraph 3 of our report of even date

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

b. According to the information and explanations given to us, the Company has a phased programme of verification of fixed assets that is reasonable having regard to the size of the Company and the nature of its business. The management has carried out physical verification of fixed assets during the year and discrepancies noted have been properly dealt with in the books of accounts.

c. The Company has not disposed of any substantial part of its fixed assets so as to affect its going concern status.

ii. 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 its inventories. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii. a. The Company has taken loan from a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.295.00 lakhs and the year-end balance of loan taken is Rs.295.00 lakhs. The Company has not granted loan to any party covered in the register maintained under section 301 of the Companies Act, 1 956.

b. In our opinion, the rate of interest and other terms and conditions on which loans have been taken from company listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie prejudicial to the interest of the Company.

c. The Company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest.

d. There is no overdue amount of loans taken from the Company listed in the register maintained under section 301 of the Companies Act, 1 956.

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

v. a. According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion and according to the information and explanations given to us, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under, where applicable have been complied with. We are informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

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

viii. In our opinion and according to the information and explanations given to us, the Company has made and maintained accounts and records prescribed by the Central

Government under section 209(1) (d) of the Companies Act, 1 956 in respect of textile division.

ix. a. According to the information and explanations given to us and the records of the Company examined by us, the Company is regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income- tax, wealth-tax, service tax, sales tax, custom duty, excise duty, cess and other statutory dues as applicable with the appropriates authorities and there were no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us and records of the Company examined by us, the particulars of

sales tax, income tax, customs duty, excise duty, service tax and wealth tax, as at 31st March, 2010 which have not been deposited on account of dispute pending, are as under:

Name of the Statute Nature of Amount the Dues (Rs. in lakhs) Income-Tax Act, 1961 Income Tax 4.88 Central Excise Act, 1944 Excise Duty 1323.85 Central Excise Act, 1944 Penalty 1323.85 Sales Tax Act - State of Bihar VAT/Interest/ 10.93 Penalty Service Tax Service Tax 1.76 (Finance Act, 1994) Service Tax Service Tax 1.67 (Finance Act, 1994) Service Tax Service Tax 2.09 (Finance Act, 1994) Service Tax Service Tax 1.64 (Finance Act, 1994)

Name of the Statute Period to which Forum where dispute the amount relates is pending Income-Tax Act, 1961 F.Y 2002-2003 DCIT Central Excise Act, 1944 F.Y 2003-04 & 2004-05 CESTAT, Chennai Central Excise Act, 1944 F.Y 2003-04 & 2004-05 CESTAT, Chennai Sales Tax F.Y 2005-06 Joint Commissioner (Appeals) Service Tax January 2005 to High Court (Finance Act,1994) September 2005 Service Tax October 2005 to High Court (Finance Act, 1994) March 2006 Service Tax April 2006 to Bhandara Division, (Finance Act, 1994) September 2006 Nagpur Service Tax October 2006 to Bhandara Division, (Finance Act, 1994) February 2007 Nagpur

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

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

xii. According to information and explanations given to us and based on the documents and records produced to us, the Company has maintained adequate documents and records in respect of loans and advances granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

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

xiv. In our opinion and according to the information and explanation given to us, the Company is not dealing 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.

xv. In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions. Accordingly, the provisions of clause 4(xv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

xvi. In our opinion and according to the information and

explanation given to us, the term loans have been applied for the purpose for which they were raised other than amounts temporarily invested pending utilisation of the funds for the intended use.

xvii. In our opinion and according to the information and explanation 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.

xviii. The Company has not made any preferential allotment of shares during the year to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has not issued any debentures during the year.

xx. The Company has not raised any funds on public issue and hence disclosure on the end use of money raised by the public issue is not applicable to the Company.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

For M. Anandam & Co., Chartered Accountants A.V.Sadasiva Partner Place: Secunderabad M.No.18404 Date: 10th May, 2010 Firm Regn. No.0001255

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