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Auditor Report of Welspun Corp Ltd.

Mar 31, 2023

REPORT ON THE AUDIT OF THE STANDALONE

FINANCIAL STATEMENTS

OPINION

1. We have audited the accompanying standalone financial statements of Welspun Corp Limited (the ''Company''), which comprise the standalone balance sheet as at March 31, 2023, and the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the “Act”) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, and total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.

BASIS FOR OPINION

3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the “Auditor''s responsibilities for the audit of the standalone financial statements” section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matter

How our audit addressed the key audit matter

Assessment of Impairment of carrying value of investments in and recoverability of loans to a subsidiary

(Refer notes 6, 8 and 50 to the standalone financial statements)

The Company has investment in equity shares of Welspun Specialty Solutions Limited (''WSSL'' or ''subsidiary'') of Rs. 283.65 crore as at March 31, 2023. The Company has also granted loans to the subsidiary with carrying value of Rs. 182.63 crore as at March 31, 2023. These amounts are significant to the standalone financial statements.

Consequent to the deteriorating net worth and continued losses of the subsidiary, the Company has assessed the impairment of the carrying value of the investment in subsidiary based on the market approach model (the “model”). The Company has also assessed the impairment of the carrying value of the loans based on expected credit loss model (“ECL”).

We considered this as a key audit matter due to significant management judgement involved in the above impairment models.

Our procedures included, the following:

• Understanding and evaluating the design and testing the operating effectiveness of the Company''s controls over impairment assessment of investments in subsidiary and ECL model for loans;

• In respect of assessment of carrying value of the investment in the subsidiary and recoverability of loans to a subsidiary, as applicable,

(a) Understanding the operating parameters used in the ECL and assessing consistency of our understanding of parameters with those considered in the ECL;

(b) Reviewing the market rates available on independent website with those used in model;

(c) Reviewing the information considered in the model and ECL by examining supporting documentation;

Key audit matter

How our audit addressed the key audit matter

(d) Assessing the work of the Management''s external valuation expert for model including their independence and objectivity;

(e) Testing the mathematical accuracy of the model and ECL.

Based on the above procedures performed, we found the Management''s conclusion with respect to recoverability of these amounts to be reasonable and appropriate.

To the Members of Welspun Corp Limited

KEY AUDIT MATTER

4. Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. This matter was addressed in the context of our audit of the standalone financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on this matter.

OTHER INFORMATION

5. The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Directors'' Report, Corporate Governance Report and Business Responsibility and Sustainability Report and Other Information in Annual Report including annexures thereto, but does not include the financial statements and our auditors'' report thereon. The Annual report is expected to be made available to us after the date of this auditor''s report.

Our opinion on the standalone financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

When we read the Annual report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take appropriate action as applicable under the relevant laws and regulations.

RESPONSIBILITIES OF MANAGEMENT AND

THOSE CHARGED WITH GOVERNANCE FOR

THE STANDALONE FINANCIAL STATEMENTS

6. The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance, changes in equity 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. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

7. In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

AUDITOR’S RESPONSIBILITIES FOR THE

AUDIT OF THE STANDALONE FINANCIAL

STATEMENTS

8. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered

material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

9. As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors'' report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors'' report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

10. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

11. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

12. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors'' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

REPORT ON OTHER LEGAL AND REGULATORY

REQUIREMENTS

13. As required by the Companies (Auditor''s Report) Order, 2020 (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 B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

14. 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 standalone balance Sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows dealt with by this report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on March 31, 2023, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023, 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 with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate report in “Annexure A”.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements -Refer note 45 to the standalone financial statements;

ii. The Company was not required to recognise a provision as at March 31, 2023 under the applicable law or accounting standards, as it does not have any material foreseeable losses on longterm contract. The Company did not have any long-term derivative contracts as at March 31, 2023.

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

iv. (a) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the note 56 (vii) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The management has represented that, to

the best of its knowledge and belief, as disclosed in the notes to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries (Refer note 56(vii) to the standalone financial statements) ; and

(c) Based on such audit procedures that we considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under subclause (a) and (b) contain any material misstatement.

v. The dividend declared and paid during the year by the Company is in compliance with Section 123 of the Act.

vi. As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 (as amended), which provides for books of account to have the feature of audit trail, edit log and related matters in the accounting software used by the Company, is applicable to the Company only with effect from financial year beginning April 1, 2023, the reporting under clause (g) of Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), is currently not applicable.

15. 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.

For Price Waterhouse Chartered Accountants LLP

Firm Registration Number: 012754N/N500016

Neeraj Sharma

Partner

Membership Number: 108391 UDIN: 23108391BGTBVH7317

Place: Zurich, Switzerland

Date: May 30, 2023


Mar 31, 2022

REPORT ON THE AUDIT OF THE STANDALONEFINANCIAL STATEMENTSOpINION

1. We have audited the accompanying standalone financial statements of Welspun Corp Limited (the “Company”), which comprise the standalone balance sheet as at March 31, 2022, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.

2. I n our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the “Act”) (refer Emphasis of matter paragraph 5 below) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2022 and total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.

BASIS FOR OPINION

3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the “Auditors'' responsibilities for the audit of the standalone financial statements” section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are

relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

EMPHASIS OF MATTERS

4. We draw your attention to Note 51 to the standalone financial statements, regarding the approval of the Scheme of Arrangement between Welspun Steel Limited (the “Demerged Company” or “WSL”) and the Company and their respective shareholders for transfer of the Demerged Undertaking (the ''Scheme'') received from the National Company Law Tribunal vide its Order dated March 16, 2022, from appointed date of April 1, 2021. However, the accounting treatment pursuant to the Scheme has been given effect to from the date required under Ind AS 103 - Business Combinations, which is the beginning of the preceding period from April 1, 2020. Accordingly, the figures for the year ended March 31, 2021, have been restated to give effect to the aforesaid merger.

5. We draw your attention to note 51 to the standalone financial statements, regarding the accounting treatment and presentation of Cumulative Redeemable Preference shares (“CRPS”), issued on March 16, 2022 pursuant to the Scheme (Refer paragraph 4 above) as a financial liability in its entirety in accordance with the requirements of Ind AS 32 ''Financial Instruments: Presentation'' and Ind AS 109 ''Financial Instruments''. Such accounting treatment and presentation, however, is not in accordance with the provisions of section 2(64) and section 43 of the Act.

Our opinion is not modified in respect of these matters.

KEY AUDIT MATTERS

6. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matter

How our audit addressed the key audit matter

Appropriateness of revenue recognition

(Refer note 1.3 and 25 to the standalone

We performed the following procedures:

financial statements)

•

Understanding, evaluating and testing the design and

The Company recognises revenue in

the operating effectiveness of controls relating to

accordance with Ind AS 115 “Revenue from

revenue recognition under Ind AS 115;

Contracts with Customers”.

•

Testing the reconciliation of the amounts as per the

Revenue from the sale of goods is recognised

sales register to the general ledger;

at a point in time when the control has been transferred, which generally coincides with terms as agreed with the customers.

•

Reading of contracts to identify significant terms of the contracts;

The above was considered to be a key audit matter since revenue is significant to the standalone financial statements, and is required

•

Evaluating the contract terms to assess the timing of transfer of control to the customer and to determine whether revenue is recognised appropriately;

to be recognised in accordance with the terms

•

Testing whether the revenue recognition (including

of the customer contracts, which involve

procedures related to cut off) is in line with the terms

management judgements as described above.

of customer contracts;

•

Testing of journal entries for revenue transactions; and

•

Evaluating adequacy of the presentation and disclosures.

Based on the above procedures, no significant exceptions were noted by us in revenue recognition including those relating to presentation and disclosures as required by applicable accounting standard.

Assessment of impairment of carrying value of investments in and recoverability of loans to a subsidiary

(Refer note 6, 8 and 51 to the standalone

Our

procedures included, the following:

financial statements)

•

Understanding and evaluating the design and testing the

The Company has investment in equity shares of Welspun Specialty Solutions Limited (''WSSL'' or ''subsidiary'') of '' 2,836.50 million as at March 31, 2022. The Company has also granted loans to the subsidiary with carrying value of '' 886.34 million as at March 31, 2022. These amounts are significant to the

•

operating effectiveness of the Company''s controls over impairment assessment of investments in subsidiary and ECL model for loans and recognition of provision;

In respect of assessment of carrying value of the investment in the subsidiary and recoverability of loans to the subsidiary.

financial statements.

(a) Understanding the operating parameters

Consequent to the deteriorating net worth and continued losses of the subsidiary, the Company has assessed the impairment of the

used in the ECL and assessing consistency of our understanding of parameters with those considered in the ECL;

carrying value of the investment in subsidiary

(b) Reviewing the market prices available on

based on the market approach model (the

independent website for model;

“model”). The Company has also assessed the impairment of the carrying value of the loans based on expected credit loss model (“ECL”).

(c) Reviewing the information considered in the model and ECL by examining supporting documentation;

We considered this as a key audit matter due to significant management judgement involved in the above impairment models.

(d) Assessing the work of the Management''s external valuation expert for model including their independence and objectivity;

Key audit matter

How our audit addressed the key audit matter

(e) Testing the mathematical accuracy of the model and ECL; and

(f) Reading the latest financial information available including quarterly results and audit report issued by the auditors of the subsidiary.

Based on the above procedures performed, we found the Management''s conclusion with respect to recoverability of these amounts to be reasonable and appropriate.

OTHER INFORMATION

7 The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in Management Discussion and Analysis, Directors'' Report, Corporate Governance Report and Business Responsibility Report and Other Information in Annual Report including Annexure thereto but does not include the standalone financial statements and our auditors'' report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

RESPONSIBILITIES OF MANAGEMENT ANDTHOSE CHARGED WITH GOVERNANCE FORTHE STANDALONE FINANcIAL STATEMENTS

8. The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance, changes in equity 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. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and

maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

9. In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

AUDITORS’ RESPONSIBILITIES FOR THE

AUDIT Of THE Standalone FINANcIAL

STATEMENTS

10. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors'' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

11. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not

detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors'' report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors'' report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

12. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

14. From the matters communicated with those charged with governance, we determine those

matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors'' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

OTHER MATTER

15. We did not audit the comparative figures for year ended March 31, 2021, which have been restated to include the financial information of the Demerged undertaking (referred to in Note 51 of the standalone financial statements) which reflects total assets of '' 7,255.82 millions as at March 31, 2021, net assets of '' 5,135.74 millions as at March 31, 2021, total revenue of '' 6,504.80 millions, total net profit after tax of '' 159.30 millions and total comprehensive income of '' 159.43 millions for the year ended March 31, 2021, and cash flows (net) of '' (0.10) millions for the year ended March 31, 2021. The said financial information of the Demerged undertaking have been provided to us by the management, and our opinion on the standalone financial statements of the Company to the extent they relate to these Demerged Undertaking is based solely on such unaudited financial information furnished to us. We have audited the adjustments made by the Management, including adjustments required for consistency of accounting policies, arrising on account of scheme of arrangement to arrive at the restated comparative figures for year ended March 31, 2021. Our opinion is not modified in respect of the above matter.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

16. As required by the Companies (Auditor''s Report) Order, 2020 (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 B, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

17. 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. (Refer Emphasis of matter paragraph 5 above)

(c) The standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors subsequent to March 31, 2022, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022, 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate report in “Annexure A”.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 45 to the standalone financial statements.

ii. The Company was not required to recognise a provision as at March 31, 2022, under the applicable law or accounting standards, as it does not have any material foreseeable losses on long-term contract. The Company did not have any long-term derivative contracts as at March 31, 2022.

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

iv. (a) The management has represented

that, to the best of its knowledge and belief, other than as disclosed in the note 56 (vii) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any

other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

(c) Based on such audit procedures that we considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.

v. The dividend declared and paid during the year by the Company is in compliance with Section 123 of the Act.

18. The Company has provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

For Price Waterhouse Chartered Accountants LLP

Firm Registration Number: 012754N/N500016

Neeraj Sharma

Partner

Place: Mumbai Membership No. 108391

Date: May 27, 2022 UDIN: 22108391AJSHPS2221


Mar 31, 2018

Independent Auditors’ Report

To,

The Members, Welspun Corp Limited

Report on the Standalone Indian Accounting

Standards (Ind AS) Financial Statements

1. We have audited the accompanying standalone financial statements of Welspun Corp Limited (the "Company”), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Ind

AS Financial Statements

2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the "Act”) with respect to the preparation of these standalone Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

3. Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.

4. We have taken into account the provisions of the

Act and the Rules made there under including 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.

5. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS 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 standalone Ind AS financial statements.

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

Opinion

8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, and its total comprehensive income (comprising of profit and other comprehensive income), its cash flows and changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor''s Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (the "Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.

10. 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 (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on March 31, 2018, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A.

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

i. The Company has disclosed the impact of pending litigations as at March 31, 2018 on its financial position in its standalone Ind AS financial statements - Refer Note 44.

ii. The Company has long-term contracts including derivative contracts as at March 31, 2018 for which there were no 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 during the year ended March 31, 2018.

iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2018.

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

1. We have audited the internal financial controls over financial reporting of Welspun Corp Limited (the "Company”) as of March 31, 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

2. 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 Act.

Auditors’ Responsibility

3. 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 deemed to be prescribed under section 143(10) of the Act 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 ICAI. 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.

4. 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.

5. 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

6. 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

7. 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

8. 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 March 31, 2018, 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.

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) The title deeds of immovable properties, as disclosed in Note 3 and Note 4 on fixed assets to the financial statements, are held in the name of the Company.

ii. The physical verification of inventory excluding stocks with third parties have been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. The discrepancies noticed on physical verification of inventory as compared to 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. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.

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 Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.

v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.

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

vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of tax deducted at source, value added tax and service tax, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues, including provident fund, employees'' state insurance, duty of customs, duty of excise, cess, goods and service tax with effect from July 1, 2017 and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income tax, sales tax/ value added tax, central sales tax, service tax, duty of customs, duty of excise as at March 31, 2018 which have not been deposited on account of a dispute, are as follows:

Name of the statute

Nature of

Amount

Period to which

Forum where the dispute is pending

dues

(Rs. In Million)

the amount relates

Central Excise Act,

Duty of

0.09

FY 2003-04

High Court, Ahmedabad

1944

Excise

254.80

FY 2005-06 to 2013-14

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

93.89

FY 2013-14

Review Committee, Commissioner LTU, Mumbai

3.38

FY 2008-09

Commissioner (Appeals), Mumbai

Gujarat Sales Tax

Central Sales

234.70

FY 2013-14 to 2015-16

Deputy Commissioner Appeals, Rajkot

Act, 1969 and Gujarat Value Added Tax Act, 2003

Tax

5.82

FY 2008-09 t0 2012-13

Joint Commissioner of Commercial Tax Appeals, Vadodara

Gujarat Sales Tax

Sales Tax/

770.00

FY 2013-14 to

Deputy Commissioner Appeals, Rajkot

Act, 1969 and Gujarat

Value Added

2015-16

Value Added Tax Act, 2003

Tax

122.30

FY 2006-07 to 2007-08

Deputy Commissioner Appeals, Rajkot

2.29

FY 1999-00 to 2006-07

Gujarat Commercial Tax Tribunal

64.53

FY 2007-08 to 2009-10

Joint Commissioner of Commercial Tax Appeals, Vadodara

Finance Act, 1994

Service Tax

1.12

FY 2013-14

Commissioner (Appeals) LTU, Mumbai

3.92

FY 2008-09

Commissioner Central Excise & Customs, Vadodara

0.60

FY 2013-14

Commissioner (Appeals), Surat

6.43

FY2009-10 to 2010-11

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

Finance Act, 1994

Service Tax

1.18

FY 2012-13, FY 2014-15 to 2015-16

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

6.13

FY 2005-06 to 2011-12

Additional Commissioner Central Excise & Customs, Vadodara

0.42

FY 2014-15

Assistant Commissioner Central Excise & Customs, Bharuch

0.11

FY 2008-09 to 2009-10

Deputy Commissioner Central Excise & Customs, Bharuch

1.09

FY 2011-12 to 201213

Joint Commissioner Central Excise & Customs, Vadodara

28.90

FY 2006-07 to 2010-11

Custom Excise Service Tax Appellate Tribunal, Mumbai

6.07

FY 2011-12

Commissioner of Central Excise & Service Tax, Mumbai

0.21

FY 2009-10 to 2010-11

Superintendent of Central Excise & Customs, Bharuch

1.69

FY 2015-16

Joint Commissioner LTU, Mumbai

1.74

FY 2013-14

High Court, Ahmedabad

10.57

FY 2013-14

Supreme Court, Delhi

10.27

FY 2004-05 to 2006-07

Supreme Court, Delhi

Name of the statute

Nature of dues

Amount (Rs. In Million)

Period to which the amount relates

Forum where the dispute is pending

Custom Act, 1962

Duty of Customs

91.89

FY 2012-13 to 201314

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

0.43

FY 2013-14

Additional Commissioner of Customs (Exports), Mumbai

Income Tax Act 1961

Income Tax

2.33

AY 2014-15

Commissioner of Income Tax (Appeals), Vadodara

6.23

AY 2010-11 to 201213

Income Tax Appellate Tribunal, Ahmedabad

viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or dues to debenture holders as at the balance sheet date. The Company does not have loans or borrowings from Government as at the balance sheet date.

ix. The Company has not raised any moneys by way of initial public offer, further public offer and term loans. In our opinion, and according to the information and explanations given to us, the moneys raised by way of debt instruments have been applied for the purposes for which they were obtained.

x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.

xi. 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. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act.

xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any noncash transactions with its directors or persons connected with them. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

For Price Waterhouse

Chartered Accountants LLP

Firm Registration Number: 012754N/N500016

Mehul Desai

Mumbai Partner

May 02, 2018 Membership Number: 103211


Mar 31, 2017

To The Members of Welspun Corp Limited

Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements

1. We have audited the accompanying standalone financial statements of Welspun Corp Limited (the “Company”), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Ind AS Financial Statements

2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the “Act”) with respect to the preparation of these standalone Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and statement of changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

3. Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.

4. We have taken into account the provisions of the Act and the Rules made there under including 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.

5. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS 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 standalone Ind AS financial statements.

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

Opinion

8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, and its profit (including other comprehensive income), its cash flows and the statement of changes in equity for the year ended on that date.

Other Matter

9. The financial information of the Company for the year ended March 31, 2016 and the transition date opening balance sheet as at April 01, 2015 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements as at and for the years ended March 31, 2016 and March 31, 2015 prepared in accordance with the Companies (Accounting Standards) Rules, 2006 (as amended) which were audited by us, on which we expressed an unmodified opinion dated May 23, 2016 and April 28, 2015 respectively. The adjustments to those financial statements for the differences in accounting principles adopted by the Company on transition to Ind AS have been audited by us.

Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

10. As required by the Companies (Auditor''s Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (the “Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.

11. 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 (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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 A.

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

i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2017 on its financial position in its standalone Ind AS financial statements - Refer Note 44.

ii. The Company has long-term contracts including derivative contracts as at March 31, 2017 for which there were no 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 during the year ended March 31, 2017.

iv. The Company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from November 08, 2016 to December 30, 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the Management - Refer Note 45.

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

1. We have audited the internal financial controls over financial reporting of Welspun Corp Limited (the “Company”) as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

2. 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 Act.

Auditors’ Responsibility

3. 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 deemed to be prescribed under section 143(10) of the Act 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 ICAI. 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.

4. 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

5. 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

6. 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

7. 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

8. 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 March 31, 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.

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) The title deeds of immovable properties, as disclosed in Note 3 on fixed assets to the financial statements, are held in the name of the Company.

ii. The physical verification of inventory excluding stocks with third parties have been conducted at

reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. The discrepancies noticed on physical verification of inventory as compared to 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. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and

(iii)(c) of the said Order are not applicable to the Company.

iv. I n 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 Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.

v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.

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

vii. (a) According to the information and explanations given to us and the records of the Company

Name of the statute Nature of

Amount (Rs, In

Period to which the

Forum where the dispute is pending

dues

Millions)

amount relates

Central Excise Act,

Duty of

0.09

FY 2003-04

High Court, Ahmedabad

1944

Excise

11.16

FY 2012-13

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

235.35

FY 2007-08 to 2011-12

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

64.43

FY 2013-14

Review committee, Commissioner LTU, Mumbai

0.08

FY 2007-08

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

0.10

FY 2013-14

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

3.38

FY 2008-09

Commissioner (Appeals), Mumbai

4.84

FY 2005-06 to 2007-08

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

3.37

FY 2009-10

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

Gujarat Sales Tax

CST

234.74

FY 2013-14 to 2015-16

Dy. Commissioner Appeal, Rajkot

Act, 1969 and Gujarat Value

A _ _J | , A ¦ 4—

4.17

FY 2008-09

Joint Commissioner of Commercial Tax Appeals, Vadodara

Added Tax Act, 2003

1.65

FY 2009-10 t0 2012-13

Joint Commissioner of Commercial Tax Appeals,

Vadodara

Gujarat Sales Tax

Sales Tax/

769.99

FY 2013-14 to 2015-16

Dy. Commissioner Appeal, Rajkot

Act, 1969 and Gujarat Value Added Tax Act,

VAT

122.29

2.29

FY 2006-07 to 2007-08 FY 1999-00 to 2006-07

Dy. Commissioner Appeal, Rajkot Dy. Commissioner Appeal, Rajkot

2003

15.22

FY 2007-08 to 2009-10

Joint Commissioner of Commercial Tax Appeals, Vadodara

Finance Act, 1994

Service

Tax

1.12

FY 2009-10 and 2013-14

Commissioner (Appeals) LTU Mumbai

3.92

FY 2008-09

Commissioner Central Excise And Customs, Vadodara

examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of income tax, though there has been a slight delay in a case, and is regular in depositing undisputed statutory dues, including provident fund, employees’ state insurance, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax as at March 31, 2017 which have not been deposited on account of a dispute, are as follows:

viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.

Name of the statute Nature of dues

Amount ('' In Million)

Period to which the amount relates

Forum where the dispute is pending

0.60

FY 2013-14

Commissioner (Appeal), Surat

1.18

FY 2009-10

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

5.25

FY2009-10 to 2010-11

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

1.11

FY 2006-07 to 2012-13

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

10.57

FY 2013-14

Supreme Court, Delhi

10.27

FY 2004-05 to 2006-07

Supreme Court, Delhi

Custom Act, 1962 Duty of Customs

8,609.82

FY 2007-08 to 2009-10

Bombay High Court

Income Tax Act 1961 Income Tax

98.82

FY 2012-13

Commissioner of Income Tax, (Appeals)

ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.

x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.

xi. 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. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any noncash transactions with its directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

For Price Waterhouse

Chartered Accountants LLP

Firm Registration Number: 012754N/N500016

Mehul Desai

Mumbai Partner

May 08, 2017 Membership Number : 103211


Mar 31, 2016

To the Members of Wels pun Corp Limited

Report on the Standalone Financial Statements

1. We have audited the accompanying standalone financial statements of Wels pun Corp Limited ("the Company”), which comprise the Balance Sheet as at March 31, 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 Standalone Financial Statements

2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act”) with respect

to the preparation of these standalone financial statements to 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 and Accounting Standard 30, Financial Instruments: Recognition and Measurement issued by the Institute of Chartered Accountants of India to the extent it does not contradict any other accounting standard referred to in Section 133 of the Act read with Rule 7 of Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

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

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

5. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements 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.

6. 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 auditors'' 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.

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

Opinion

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

Report on Other Legal and Regulatory Requirements

9. As required by ''the Companies (Auditor''s Report) Order, 2016'', issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the "Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

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

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

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

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

(e) On the basis of the written representations received from the directors as on March 31, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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 A.

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

i The Company has disclosed the impact, if any, of pending litigations as at March 31, 2016 on its financial position in its standalone financial statements.

ii. The Company has made provision as at March 31, 2016, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2016.

For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016

Referred to in paragraph 10 of the Independent Auditors’ Report of even date to the members of Wels pun Corp Limited on the standalone financial statements for the year ended March 31, 2016

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

1. We have audited the internal financial controls over financial reporting of Wels pun Corp Limited ("the Company”) as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

2. 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 Act.

Auditors’ Responsibility

3. 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 deemed to be prescribed under section 143(10) of the Act 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 ICAI. 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.

4. 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.

5. 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

6. 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

Referred to in paragraph 10 of the Independent Auditors’ Report of even date to the members of Welspun Corp Limited on the standalone financial statements for the year ended March 31, 2016

7. 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

8. 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 March 31, 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.

Referred to in paragraph 9 of the Independent Auditors’ Report of even date to the members of Welspun Corp Limited on the standalone financial statements as of and for the year ended March 31, 2016

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) The title deeds of immovable properties, as disclosed in Note 12 on fixed assets to the financial statements, are held in the name of the Company.

ii. The physical verification of inventory have been conducted at reasonable intervals by the Management during the year. The discrepancies noticed on physical verification of inventory as compared to 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. Therefore, the provisions of Clause 3(iii), (iii)

(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.

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 Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.

v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74,

75 and 76 of the Act and the Rules framed there under to the extent notified.

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

vii. (a) According to the information and

explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees'' state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of wealth tax and cess which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax as at March 31, 2016 which have not been deposited on account of a dispute, are as follows:

Name of the statute

Nature of dues

Amount (Rs. In Millions)

Period to which the amount relates

Forum where the dispute is pending

Central Excise Act, 1944

Duty of Excise

0.09

FY 2003-04

High Court, Ahmadabad

11.16

FY 2012-13

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

235.35

FY 2007-08 to 2011-12

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

90.37

FY 2013-14

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

0.08

FY 2007-08

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

0.10

FY 2013-14

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

Gujarat Sales Tax Act, 1969 and Gujarat Value Added Tax Act, 2003

CST

234.74

FY 2013-14 to 201516

Dy. Commissioner Appeal, Rajkot

Gujarat Sales Tax Act, 1969 and Gujarat Value Added Tax Act, 2003

CST

4.17

FY 2008-09

Joint Commissioner of Commercial Tax Appeals, Vadodara

Gujarat Sales Tax Act, 1969 and Gujarat Value Added Tax Act, 2003

Sales Tax/ VAT

769.99

FY 2013-14 to 201516

Dy. Commissioner Appeal, Rajkot

2.05

FY 2000-03

Gujarat Commercial Tax Tribunal

5.90

FY 2008-09

Joint Commissioner of Commercial Tax, Appeals, Vadodara

Finance Act, 1994

Service Tax

2.02

FY 2008-09 and 2009-10

Additional Commissioner Central Excise & Customs, Vadodara

0.77

FY 2012-13

Commissioner (Appeal), Surat

0.60

FY 2013-14

Commissioner (Appeal), Surat

1.12

FY 2009-10

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

5.25

FY2009-10 to 2010-11

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

0.59

2006-07 to 2011-12

Custom Excise Service Tax Appellate Tribunal, Ahmadabad

10.27

FY 2004-05 to 2006-07

Supreme Court, Delhi

Custom Act, 1962

Duty of Customs

8,609.82

FY 2007-08 to 2009-10

Bombay High Court

Income Tax Act 1961

Income Tax

1,676.96

FY 2004-05 FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11

Commissioner of income tax, (Appeals)

viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.

ix. In our opinion, and according to the information and explanations given to us, the Company

has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans during the year Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.

x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.

xi. 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. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Accounting Standard (AS) 18, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has entered into non cash transactions with its director, in compliance with the provisions of Section 192 of the Act.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016

Mehul Desai

Mumbai Partner

May 23, 2016 Membership Number: 103211


Mar 31, 2015

1. We have audited the accompanying standalone financial statements of Welspun Corp Limited("the Company"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

2. The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements to 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, and Accounting Standard 30, Financial Instruments: Recognition and Measurement issued by the Institute of Chartered Accountants of India to the extent it does not contradict any other accounting standard referred to in Section 133 of the Act read with Rule 7 of Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls,that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

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

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

5. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements 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.

6. 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 judgement, 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.

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

Opinion

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

Emphasis of Matter

9. We draw your attention to Note 46 (b) relating to remuneration paid to the managing director of the Company for the financial year 2012-13 in excess of the limits specified in the Schedule XIII of the Companies Act, 1956 wherein the Company received approval from the Central Government for a lower amount. During

the current financial year, the Company has been advised that the Central Government approval was not required for payment of remuneration to the Managing Director. Consequently, the Company has requested the Central Government to treat the original application as withdrawn and has accounted as paid the amount of Rs. 83.01million shown previously as refundable by the Managing Director.

Our opinion is not qualified in respect of this matter.

Other Matter

10. The standalone financial statements of the Company as at March 31, 2014 and for the year then ended were audited by another firm of chartered accountants under the Companies Act, 1956 who, vide their report dated April 29, 2014, expressed an unmodified opinion on those financial statements.

Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Require- ments

11. As required by 'the Companies (Auditors' Report) Order, 2015', issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the "Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

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

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

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

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

(e) On the basis of the written representations received from the directors as on March 31, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2015 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 Auditors' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:

i. The Company has disclosed the impact, if any, of pending litigations as at March 31,2015 on its financial position in its standalone financial statements.

ii. The Company has made provision as at March 31, 2015, as required under the applicable law or Accounting Standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31,2015.

Referred to in paragraph 11 of the Independent Auditors' Report of even date to the members of Welspun Corp Limited on the standalone financial statements as of and for the year ended March 31, 2015

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

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

(b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to 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. Therefore, the provisions of Clause 3(iii), (iii)(a) and (iii) (b) of the said Order are not applicable to the Company.

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 and fixed assets and for the sale of goods. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

v. The Company has not accepted any deposits from the

public within the meaning of Sections 73, 74, 75 and 76 of the Act and the rules framed there under to the extent notified.

vi. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been specified 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. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

vII. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of wealth-tax and cess which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of excise, duty of customs, value added tax as at March 31, 2015 which have not been deposited on account of a dispute, are as follows:

Name of the statute Nature of dues Amount Period to which the amount relates

Central Excise Act, 1944 Duty of Excise 90.37 FY 2013-14

0.08 FY 2007-08

0.10 FY 2013-14

0.09 FY 2003-04

11.16 FY 2008-09 to 2013-14

235.35 FY 2007-08 to 2011-12

Central Sales Tax Act,1956 CST 5.61 FY 2008-09, 2010-11 and 2011-12

Gujarat Sales Tax Act,1969 Sales Tax/ VAT 2.04 FY 2000-01 to and 2002-03

Gujarat Value Added Tax 24.74 FY 2006-07 to Act,2003 2008-09

5.90 FY 2008-09

Finance Act, 1994 Service Tax 2.02 FY 2008-09 and 2009-10

10.27 FY 2004-05 to 2006-07

1.36 FY 2006-07 to 2012-13

0.60 FY 2013-14

9.76 FY 2008-09 to 2011-12

1.17 FY 2008-09

Customs Act, 1962 Duty of 8,609.82 FY 2007-08 Customs to 2009-10

Income Tax Act, 1961 Income tax 2,196.44 FY 2004-05 to 2012-14

Name of the Director Forum where the dispute is pending

Central Excise Act 1944 Custom Excise Service Tax Appellate Tribunal, Delhi

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

Gujarat High Court, Ahmedabad

Commissioner of Central Excise, Rajkot

Customs, Excise and Service tax Appellate Tribunal, Ahmedabad

Cenral Sales Tax Act 1956 Joint Commissioner of Commercial Tax appeals, Vadodara

Guajarat Sales tax Act Gujarat Commercial Tax Tribunal 1969 and Gujarat Value Added Tax Act 2003 Joint Commissioner, Vadodara

Joint Commissioner of Commercial Tax, Appeals, Vadodara

Finance Act 1994 Additional Commisssioner Central Excise & Customs, Vadodara

Supreme Court, Delhi

Custom Excise Service Tax Appellate Tribunal, Ahmedabad

Commissioner (Appeal), Surat Commissioner of Central Excise, Rajkot

Commissioner of Central Excise, Rajkot

Customs Act 1962 Bombay High Court

Income Tax Act 1961 Commissioner of Income tax, (Appeals)

c) The amount required to be transferred to Investor Education and Protection Fund has been transferred within the stipulated time in accordance with the provisions of the Companies Act, 1956 and the rules made thereunder.

viii. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

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

x. In our opinion, and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks or financial institutions during the year, are not prejudicial to the interest of the Company.

xi. In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

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

For Price Waterhouse Chartered Accountants LLP Firm Registration Number: (FRN 012754N/N500016)

Mehul Desai Place: Mumbai Partner Date: April 28, 2015 Membership Number:103211


Mar 31, 2014

We have audited the accompanying financial statements of Welspun Corp Limited ("the company") which comprise of balance sheet as at 31 March 2014, the statement of profit and loss, the cash flow statement for the year ended on that date and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 and other accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India ("ICAI"). 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a. in the case of the balance sheet, of the state of affairs of the company as at 31 March 2014;

b. in the case of the statement of profit and loss, of the loss of the company for the year ended on that date; and

c. in the case of the Cash Flow statement, of the cash flows of the company for the year ended on that date.

Emphasis of Matter

We draw attention to Note 45(b) of the financial statements, relating to remuneration paid to the Managing Director of the Company for the financial year 2012-13, which turned out to be in excess by Rs. 83.01 million considering the limits approved by the Central Government. The Managing Director holds the said amount in trust and is refundable to the Company. Our Opinion is not qualified in respect of this matter.

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:

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

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

(iii) 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;

(iv) In our opinion, the balance sheet, the statement of profit and loss and the cash flow statement dealt with by this report comply with the applicable Accounting Standards referred to in sub-section (3C) of section 211 of the Act read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013;

(v) On the basis of written representation received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2014, from being appointed as a director in terms of Section 274(1)(g) of the Act;

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

(i) In respect of its fixed assets:

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

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

(c) In our opinion, the Company has not disposed off a substantial part of its fixed asset during the year and the going concern status of the Company is not affected

(ii) In respect of its inventories:

(a) The inventories have been physically verified by the management during the year except stock lying with the third parties in respect of whom confirmations have been obtained. In our opinion, the frequency of verification is reasonable.

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

(c) The Company has maintained proper records of inventories. As explained to us, no material discrepancies were noticed on physical verification of inventories as compared to the book records.

(iii) (a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 301 of the Act.

(b) The Company has not taken any loans, secured or unsecured, from companies, firms or other parties covered in the register maintained under section 301 of the 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 purchases of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal controls systems in respect of the aforesaid areas.

(v) According to the information and explanations given to us, there are no contracts or arrangements the particulars of which are required to be entered in the register maintained under section 301 of the Act.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year.

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

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

(ix) According to the records of the Company examined by us and information and explanations given to us:

(a) Undisputed statutory dues, including provident fund, investor education and protection fund, employee state insurance, income tax, sales tax / value added tax, wealth tax, service tax, custom duty, excise duty, cess and any other material statutory dues to the extent applicable have generally been regularly deposited with the appropriate authorities. There are no undisputed amounts payable in respect of the aforesaid dues outstanding as at 31 March 2014 for a period of more than six months from the date they became payable.

(b) The disputed dues of income tax, sales tax / value added tax, service tax, custom duty and excise duty which have not been deposited are as under:

Name of the Statute Amount Period to which (Nature of dues) (Rs. in million) the amount relates

Gujarat Sales Tax Act, 1969 and 13.86 FY 2000-01 Gujarat Value Added Tax Act, to FY 2002-03 2003 and FY 2005-06 to FY 2006-07

Sales Tax / Value Added Tax 89.75 FY 2006-07 to FY 2009-2010

Central Sales Tax Act, 1956 0.92 FY 2001-02

Central Sales Tax 4.39 FY 2008-09 and FY 2009-2010

Central Excise Act, 1944 0.09 FY 2003-04

* Excise Duty 6.33 FY 2006-07 to FY 2007-08 and FY 2010-11

15.35 FY 2008-09 to FY 2012-13 3.55 FY 2007-08 FY 2009-10 and FY 2011-12

23.90 FY 2008-09 and 2009-10

* Service Tax 10.27 FY 2004-05 to FY 2006-07

16.99 FY 2006-07 to FY 2011-12

95.73 FY 2005-06 to FY 2013-14

40.63 FY 2007-08 to FY 2012-13

23.05 FY 2008-09 to FY 2012 -13

21.34 FY 2006-07, FY 2009-10 to FY 2012-13

Customs Act, 1962 8,609.82# FY 2007-08 * Custom duty to FY 2009-10

Income Tax Act, 1961 2,190.21 FY 2004-05 * Income tax to FY 2010-11 411.88 FY 2009-10 to FY 2012-13

Name of the Statute Forum where dispute (Nature of dues) is pending

Gujarat Sales Tax Act, 1969 and Gujarat Value Added Tax

Gujarat Value Added Tax Act, Tribunal 2003

Sales Tax / Value Added Tax Joint Commissioner of Commercial tax (Appeals)

Central Sales Tax Act, 1956 Gujarat Value Added Tax Tribunal

Central Sales Tax Joint Commissioner of Commercial tax (Appeals)

Central Excise Act, 1944 High Court

* Excise Duty Custom Excise and Service Tax Appellate Tribunal Commissioner of Central Excise and Customs Commissioner of Central Excise and Customs (Appeals)

Deputy Commissioner of Central Excise and Customs

* Service Tax Supreme Court of India

Custom Excise and Service Tax Appellate Tribunal

Commissioner/Additional Commissioner of Central Excise and Customs

Commissioner of Central Excise and Customs (Appeals) Deputy / Assistant Commissioner of Central Excise and Customs

Superintendent of Central Excise and Customs

Customs Act, 1962 Custom Excise and Service * Custom duty Tax Appellate Tribunal

Income Tax Act, 1961 Commissioner of Income * Income tax tax, (Appeals) Commissioner of Income tax, (Appeals)

#Does not include penalty of (i) Rs. 8,609.82 million on Company and Rs. 205 million on directors and officers of the Company levied by Commissioner of Central Excise and Custom, Mumbai and (ii) Rs. 8,609.82 million levied by Additional Director General of Foreign Trade (DGFT), Mumbai {Refer note 33(b)}.

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

(xi) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders.

(xii) In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a chit fund / nidhi / mutual benefit fund / society.

(xiv) The Company is not dealing or trading in securities, debentures and other investments.

(xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by subsidiaries and others from banks and financial institutions are prima facie not prejudicial to the interest of the Company.

(xvi) According to the information and explanations given to us, the Company has not raised any term loans during the year.

(xvii) According to the information and explanations given to us and examination of the Balance Sheet of the Company and related information as made available to us, we report that funds raised on short-term basis have not been used for long term investments.

(xviii) During the year, the Company has not made any preferential allotment of shares to companies or parties covered in the register maintained under section 301 of the Act.

(xix) The Company has created adequate security in respect of debentures issued.

(xx) The Company had raised funds by issue of foreign currency convertible bonds in the earlier years which have been utilized for the purposes for which they are raised except funds pending utilization have been temporarily invested as referred in Note 4 (d)(iv).

(xxi) Based on our audit procedures performed and according to the information and explanations given by the management, no fraud on or by the Company has been noticed or reported during the course of our audit

For MGB & Co

Chartered Accountants Firm Registration Number 101169W

Mohan Bhandari Partner Membership Number 12912 Mumbai, 29 April 2014


Mar 31, 2013

Report on the Financial Statements

1. We have audited the accompanying financial statements of Welspun Corp Limited ("the Company'''') which comprise the Balance Sheet as at 31 March, 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

2. 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 duet of ardor error.

Auditor''s Responsibility

3. 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 misstatements.

4. 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 duet of ardor 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.

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

Opinion

6. In our opinion and to the best of our information and according to the explanations given to us, they said financial statements together with the notes thereon, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In the case of the Balance sheet, of the state of affairs of the Company as at 31 March, 2013;

b) In the case of the Statement of Profit and Loss, of the Profit of the Company 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.

Emphasis of Matter

7. We draw attention to Note 46 of the financial statements, relating to remuneration paid/ provided in respect of Managing Director of the Company, which turned out to beinexcess of the limits prescribed under Section 198 read with Schedule XIII to the Act, due to inadequate profit, hence is subject to the approval of the Central Government. Our Opinion is not qualified in respect of this matter.

Report on other legal and regulatory requirements

8. 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 227ofthe Act, we give in the Annexure a statement on the matters specified in paragraphs 4and5 of the Order.

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

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

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

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

(iv) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standard referred to in sub-section(3C)ofSection211oftheAct;

(v) On the basis of written representation received from the directors as at 31 March, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as at 31 March, 2013, from being appointed as a director in terms of clause (g) of sub-section(1)of Section 274oftheAct.

Annexure referred to in Paragraph (8) under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date

(i) In respect of its fixed assets:

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

(b) The fixed assets have been physically verified by the management under a phased programme of verification, which in our opinion provides for physical verification of all the fixed assets over the period. According to the information and explanations given to us, no material discrepancies were noticed on such physical verification.

(c) During the year, in our opinion, a substantial part of its fixed asset has not been disposed off by the Company. (ii) In respect of its inventories:

(a) As explained to us, the inventories (other than materials lying with the third parties which have substantially been confirmed) have been physically verified during the year by the management.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of records, in our opinion, the Company has maintained proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) According to the information and explanations given to us, the Company has neither granted nor taken any loans, secured or unsecured to/from companies, firms or other parties covered in the register maintained under section 301 of the Act.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business for the purchases of inventory, fixed assets and for the sale of goods and services. Further, during the course of our audit, we have neither come across nor we have been informed of any instance of continuing failure to correct major weakness in the aforesaid internal control systems.

(v) To the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered in the register maintained under the said section have been so entered.

(b) Where such transactions of value in excess of rupees five lakhs in respect of any party during the year, have been made at prices which appear prima facie reasonable and/or comparable with the prevailing market prices at the relevant time.

(vi) According to the information and explanations given to us, the Company has not accepted any deposit from the public. Therefore, the provisions of Clause (vi) of paragraph 4 of the Order is not applicable to the Company

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

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

(ix) According to the books and records of the Company examined by us and information and explanations given to us:

(a) Undisputed statutory dues, including provident fund, investor education and protection fund, employee state insurance, income tax, sales tax/value added tax, wealth tax, service tax, custom duty, excise duty, cess and any other material statutory dues to the extent applicable have generally been regularly deposited with the appropriate authorities. There are no undisputed amounts payable in respect of the aforesaid dues outstanding as at 31 March 2013 for a period of more than six months from the date they became payable.

(b) Following are the particulars of dues of income tax, sales tax/value added tax, service tax, custom duty and excise duty which have not been deposited on account of any dispute:

Name of the Statute Amount Period to which Forum where dispute

(Nature of dues) (Rs. in million) the amount relates is pending

Gujarat Sales Tax Act, 1969 and 24.74 FY 2006-07 High Court

Gujarat Value Added Tax Act, 2003 to FY 2008-09

Sales Tax / Value Added Tax 13.86 FY 2000-01 to GVAT / Gujarat

FY 2002-03 Commercial Tax Tribunal and FY 2005-06 to FY 2006-07

58.01# FY 2006-07 to Joint Commissioner of

FY 2008-09 Commercial tax, Appeals

Central Sales Tax Act, 1956 0.92 FY 2001-02 Sales Tax Tribunal

Central Sales Tax 5.22 FY 2008-09 Joint Commissioner of

Commercial tax, Appeals

Central Excise Act, 1944 24.00 FY 2003-04 and High Court

- Excise Duty FY 2010-11

6.33 FY 2006-07 to Custom Excise and

FY 2007-08 Service Tax Appellate

and FY 2010-11 Tribunal

9.77 FY 2008-09 Commissioner of Central

Excise and Customs 3.45 FY 2007-08 and Commissioner of Central

FY 2009-10 Excise and Customs

(Appeals) 20.52 FY 2009-10 Deputy Commissioner of Central Excise and Customs

- Service Tax 10.27 FY 2004-05 to Supreme Court of India

FY 2006-07

17.04 FY 2007-08 to Custom Excise and Service

FY 2010-11 Tax Appellate Tribunal

82.94 FY 2005-06 to Commissioner/Additional

FY 2012-13 Commissioner of Central

Excise and Customs

31.94 FY 2006-07 to Commissioner of Central

FY 2011-12 Excise and Customs

(Appeals)

23.59 FY 2008-09 to Deputy / Assistant

FY 2012-13 Commissioner of Central

Excise and Customs 21.33 FY 2006-07, Superintendent of Central

FY 2009-10 to Excise and Customs

FY 2012-13

Customs Act, 1962

Customs Duty 8,609.82** FY 2007-08 to Custom Excise and Service

FY 2009-10 Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax 2,770.97 FY 2004-05 to Commissioner of Income

FY 2010-11 tax, (Appeals)

#X 0.7 million paid subsequent to the Balance Sheet date.

Rs.1.05 million paid subsequent to the Balance Sheet date.

**does not include penalty ofRs. 8,814.82 million (refer note 33)

(x) The Company does not have accumulated losses as at 31 March 2013 and has not incurred any cash losses during the year and in the immediately preceding year.

(xi) Based on our audit procedures and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders during the year.

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

(xiii) The Company is not a chit fund / nidhi / mutual benefit fund / society. The provisions of clause (xiii) of paragraph 4 of the Order, therefore, are not applicable to the Company.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading insecurities. However, the Company has invested its surplus funds in Mutual Funds/Bonds/Certificates of deposits during the year and maintained proper records of transactions in respect of its investments and timely entries have been made therein. All securities are held by the Company in its own name.

(xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by subsidiaries and others from banks and financial institutions are prima facie not prejudicial to the interests of the Company.

(xvi) According to the information and explanations given to us, the Company has raised term loans during the year. The term loans have been applied for the purposes for which they were raised.

(xvii) According to the information and explanations given to us and on overall examination of the Balance Sheet, we report that funds raised on short-term basis have not been used during the year for long-term investments.

(xviii) During the year, the Company has not made any preferential allotment of shares to companies or parties covered in the register maintained under section 301 of the Act.

(xix) According to the information and explanations given to us, the Company has created adequate security in respect of debentures issued.

(xx) The Company had raised funds by issue of Compulsorily Convertible Debentures, Global Depository Receipts and Foreign Currency Convertible Bonds and in the earlier years which have been utilized for the purposes for which they were raised except unutilized funds have been temporarily invested as referred in Note 2(e), 2(f) and 4(d)(iv).

(xxi) In our opinion and according to the information and explanations given to us, no fraud by the Company and no significant fraud on the Company has been noticed or reported during the year.

For MGB & Co

Chartered Accountants

Firm Registration Number 101169W



Jeenendra Bhandari

Partner

Membership Number 105077

Mumbai, 30 May 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of Welspun Corp Limited ("the Company") as at 31 March 2012, the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 ("the Act"), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we annex hereto a statement on the matters specified in paragraph 4 and 5 of the said order.

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

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

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

(c) The Balance Sheet, 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 Balance Sheet, Statement of Profit and Loss and the Cash Flow Statement dealt with by this report comply with the accounting standards referred to in Section 211 (3C) of the Act;

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

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

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

ii) In the case of the Statement of Profit and Loss, of the Profit 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 referred to in paragraph 3 of Auditors' Report to the members of Welspun Corp Limited on the accounts for the year ended 31 March 2012

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

(b) The fixed assets are physically verified by the management during the year as per the phased program designed to cover all the assets over a period, which in our opinion is reasonable having regard to the size of the Company and nature of its assets. As informed, no material discrepancies were noticed on such verification.

(c) During the year, there was no disposal of substantial part of fixed assets.

(II) (a) As explained to us, the inventories have been physically verified by the management during the year except stock lying with third parties in respect of whom confirmations have been obtained. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion, 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) As explained to us, the Company has maintained proper records of inventories and no material discrepancies were noticed on physical verification of inventories as compared to the book records.

(III) (a) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act.

(b) According to the information and explanations given to us, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the 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 purchases of inventory, fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal controls systems in respect of the aforesaid areas.

(V) According to the information and explanations given to us, there are no contracts or arrangements the particulars of which are required to be entered into the register in pursuance of section 301 of the Act.

(VI) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year.

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

(VIII) On the basis of records produced before us, we are of the opinion that prima facie cost accounting records prescribed by the Central Government under section 209 (1) (d) of the Act, in respect of activities carried on by the Company covered under the rules under that section, have been maintained. However, we are neither required to carry out nor have carried out any detailed examination of such cost accounting records with a view to determine whether they are accurate or complete.

(IX) According to the records of the Company examined by us and information and explanations given to us:

(a) Undisputed statutory dues, including provident fund, investor education and protection fund, employee state insurance, income tax, sales tax / value added tax, wealth tax, service tax, custom duty, excise duty, cess and any other material statutory dues to the extent applicable have been deposited regularly with the appropriate authorities except for delays in few cases. There are no undisputed amounts payable in respect of the aforesaid dues outstanding as at 31 March 2012 for a period of more than six months from the date they became payable.

(b) The disputed dues of Sales Tax / value added tax, Service Tax and Excise Duty which have not been deposited are as under:

Name of the Statute Amount Period to which Forum where dispute is (Nature of dues) (Rs. in million) the amount relates pending

2000-01, 2001-02, 2002-03, Gujarat Sales Tax Act 13.86 Sales tax Tribuna 1969

Sales Tax/ 2005-06 and Joint Commissioner of Value Added Tax 53.20 2006-07 Sales Tax (Appeals)

368.75 2009-10 and 2010-11 Assessment stage

Central Sales Tax Act, 1956 0.9 2001-02 Sales Tax Tribunal Central Sales Tax

Commissioner of Central 13.14 2008-09 and 2009-10 Excise and Customs

Commissioner of Central The Central Excise Act, 2003-04, 2006-07 29.93 Excise and Customs 1944 and 2007-08 (Appeals)

- Excise Duty

Deputy / Assistant 20.60 2007-2008 and 2009-10 Commissioner of Central Excise and Customs

Commissioner / Additional 97.55 2005-06 to 2011-12 Commissioner of Central Excise and Customs

Commissioner of Central 31.65 2007-08 and 2008-09 Excise and Customs Service Tax (Appeals)

Deputy Commissioner of 23.99 2006-07 to 2011-12 Central Excise and Customs

2004-05, 2006-07, Superintendent of Central 21.32 2008-09 to 2011-12 Excise and Customs

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

(XI) Based on our audit procedures and as per the information and explanations given to us, the company has not defaulted in repayment of dues to banks and debenture holders during the year.

(XII) 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) The Company is not a chit fund or a nidhi / mutual benefit fund / society.

(XIV) The Company is not dealing or trading in securities, debentures and other investments.

(XV) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by subsidiaries and others from banks and financial institutions are prima facie not prejudicial to the interests of the Company.

(XVI) The Company has not raised any term loan during the year.

(XVII) According to the information and explanations given to us and examination of the Balance Sheet of the Company and related information as made available to us, we report that funds raised on short term basis have not been used for long term investments.

(XVIII) During the year, the Company has not made any preferential allotment of shares to companies or parties covered in the register maintained under section 301 of the Act.

(XIX) The Company has created adequate security in respect of debentures issued.

(XX) The Company has raised funds by issue of Global Depository Receipts during the year and Foreign Currency Convertible Bonds in the earlier years which have been utilized for the purposes for which they are raised except funds pending utilization have been temporarily invested as referred in Note 2(e) and 4(c).

(XXI) Based on our audit procedures performed and according to the information and explanations given by the management, no fraud on or by the Company has been noticed or reported during the course of our audit except fraud by an employee, who has indulged in malpractices for wrongful personal gain detected during the year, the amount is yet to be ascertained.

For MGB & Co.

Chartered Accountants

Firm Registration Number 101169W

Jeenendra Bhandari

Partner

Membership Number 105077

Mumbai, 29 May 2012


Mar 31, 2010

1. We have audited the attached Balance Sheet of Welspun Corp Limited (Formerly Welspun Gujarat Stahl Rohren Limited) ("the Company") as at 31 March 2010, and also the Profit and Loss account and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

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

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

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

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

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

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

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the significant accounting policies and notes to accounts as per Schedule 18, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2010;

ii) In the case of the Profit and Loss account, of the Profit 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 referred to in paragraph 3 of Auditors Report to the members of Welspun Corp Limited (Formerly Welspun Gujarat Stahl Rohren Limited) on the accounts for the year ended 31 March 2010

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

(b) According to the information and explanations given to us, the fixed assets have been physically verified by the management in a phased program periodical manner at reasonable intervals, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

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

(ii) (a) The inventories have been physically verified by the management during the year except stock lying with third parties in respect of which confirmations have been obtained. In our opinion, the frequency of verification is reasonable.

(b) In our opinion, 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) As explained to us, the Company has maintained proper records of inventories and no material discrepancies were noticed on physical verification of inventories as compared to the book records.

(iii) (a) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Act. (b) According to the information and explanations given to us, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the 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 with regard to purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any major weaknesses in the internal control system.

(v) According to the information and explanations given to us, there are no contracts or arrangements the particulars of which are required to be entered into the register in pursuance of Section 301 of the Act.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year with in the meaning of section 58A and 58AA of the Act and the rules framed there under.

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

(viii) On the basis of records produced, we are of the opinion that prima facie cost accounting records prescribed by the Central Government under section 209 (1) (d) of the Act, in respect of products of the Company, have been maintained. However, we are neither required to carry out nor have carried out any detailed examination of such accounting records.

(ix) (a) According to the records of the Company, the undisputed statutory dues, including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Value Added Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues to the extent applicable have been deposited regularly with the appropriate authorities except for delays in few cases. There is no undisputed amounts payable in respect of the aforesaid dues outstanding as at 31 March 2010 for a period of more than six months from the date of becoming payable. (b) There are no disputed dues on account of Wealth Tax, Income Tax, Custom Duty, and Cess. Dues on account of the disputed Sales Tax/VAT, Service Tax and Excise Duty which have not been deposited are as under:

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

(Nature of dues) (Rs. in million) amount relates

Sales Tax 2.12 2000-2001 to 2002- 2003 Sales Tax Tribunal

(VAT)

3.61 2001-2002 and Joint Commissioner of Sales Tax

2005-2006 (Appeals)

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

(Nature of dues) (Rs. in million) amount relates

Sales Tax (VAT) 214.59 2009-2010 Assessment Stage

The Central Excise Act,

1944

- Excise Duty 0.09 2003-2004 Commissioner of Central Excise and

Customs

0.08 2007-2008 Assistant Commissioner of Central Excise

and Customs

- Service Tax 31.20 2004-2005 and Custom Excise and Service Tax Appellate

2005-2006 Tribunal (CESTAT)

7.82 2005-2006 and Custom Excise and Service Tax Appellate

2006-2007 Tribunal (CESTAT)

45.90 2006-2007 to Commissioner of Central Excise and

2008-2009 Customs

26.13 2005-2006 to Commissioner / Additional

2008-2009 Commissioner of Central Excise and Customs

0.31 2007-2008 to Deputy Commissioner of Central Excise

2009-2010 and Customs

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

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders.

(xii) 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) The Company is not a chit fund or a nidhi / mutual benefit fund / society.

(xiv) The Company is not dealing or trading in securities, debentures and other investments.

(xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantee for loans taken by subsidiaries and others from banks and financial institutions are prima facie not prejudicial to the interest of the Company.

(xvi) According to the information and explanations given to us and records of the Company examined by us, the Company has not raised any term loan during the year.

(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company and related information as made available to us, we are of the opinion that there are no funds raised on short term basis which have been used for long term investments.

(xviii) During the year, the Company has made preferential allotment of shares under the ESOP scheme to the parties covered in the register maintained under section 301 of the Companies Act, 1956. The price at which these shares were issued is not prima- facie prejudicial to the interest of the Company.

(xix) The Company has created adequate security in respect of debentures issued.

(xx) The Company has not raised any money by way of public issue during the year. Funds raised on issue of Foreign Currency Convertible Bonds (FCCB) have been utilised for the purpose for which they were raised except pending utilization have been invested in short term deposits with Banks as referred in Note 1(c).

(xxi) Based on our audit procedures performed and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the year of our audit.

For MGB & Co.

Chartered Accountants

Firm Registration No.: 101169W

Mohan Bhandari

Partner

Membership No. 12912

Mumbai, 27 April 2010

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