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Auditor Report of Yash Papers Ltd.

Mar 31, 2015

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

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

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

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

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

Opinion

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

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2015;

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

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

Report on Other Legal and Regulatory

Requirements

1. As required by the Companies (Auditor''s Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, and on the basis of such checks of the books and records of the company as we considered appropriate and according to 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.

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

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

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

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note no. 36 to the financial statements;

ii. In our opinion and as per the information and explanations provided to us, the company has not entered into any long term contracts including derivative contracts, requiring provision under applicable laws or accounting standards, for material foreseeable losses; and

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

Annexure to the Auditors'' Report

(Referred to in paragraph 1 of our report of even date on the financial statements for the financial year ended 31st March, 2015 of Yash Papers Limited)

In terms of the information and explanations given to us and also on the basis of such checks as we considered appropriate, we state that:

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

(b) All the fixed assets have not been physically verified by the management during the year but there is regular program of physical verification, which in our opinion is reasonable, having regard to the size of the Company and the nature of fixed assets. No material discrepancies have been noticed in respect of the assets physically verified during the year.

ii. (a) The inventories of the Company have been physically verified by the management at regular interval during the year. 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 nature of its business.

(c) The Company is maintaining proper records of inventories. As explained to us, the discrepancies noticed on verification were not material in relation to the operations of the Company.

iii. The Company has not granted any loan, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 189 of the Companies Act, 2013.

iv. In our opinion, there is adequate internal control system commensurate with the size of the Company and nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination 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. In our opinion, the Company has not accepted any deposit during the year within the meaning of Section 73 to Section 76 of the Companies Act, 2013 read with the Rules framed there under. The deposits were accepted by the company in earlier years in compliance of the provisions of Section 58A of the Companies Act, 1956 read with Rules framed there under. The application for extension filed with Company Law Board, in terms of Section 74 (2) of the Companies Act, 2013 is pending in respect of deposits yet to be matured as on 31.03.2015. (refer Note no. 46 of Financial Statements)

vi. We have broadly reviewed the books of account and records maintained by the Company pursuant to the Rules framed by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have not, however, made a detailed examination of the said accounts and records with a view to determine whether they are accurate or complete.

vii. (a) According to the books and records produced and examined by us, the Company is generally regular in depositing undisputed Statutory dues including Provident Fund, 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 and no undisputed amount payable in respect of aforesaid statutory dues were outstanding as at 31st March 2015 for a period of more than six months from the date they become payable.

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

Name of Nature of the dues Amount Year(s) Forum the Statute (Rs. to which where in Lacs) relates pending

The Central Disallowance 188.98 2009-10 CESTAT, Excise Act, of CENVAT Credit New 1944 Delhi

111.57 2010-11

Disallowance 0.73 2007-08 CESTAT, of CENVAT Credit New Delhi

The Income Penalty u/s 271(1)(c) 22.61 2006-07 Tax Act, 1961

2.82 2009-10 CIT Appeals - I, Kanpur

(c) According to the information and explanations given to us, there are no amounts that required to be transferred to Investors Education and Protection Fund during the year in accordance with the relevant provisions of the Companies Act, 1956.

viii. The Company has accumulated losses of Rs.3,18,95,130 as at the end of the financial year which is less than fifty percent of it''s net worth. The Company has incurred cash loss of Rs.4,48,31,614 in the current financial year. However it has not incurred any cash loss in the immediately preceding financial year.

ix. According to the information and explanations given to us and based on the documents and records produced to us, the company has not defaulted in repayment of dues to a financial institution, bank or debenture holders during the year excepting the following defaults in respect of Rupee term loans from banks which are yet to be cleared till Balance Sheet date:

a. Interest for the month of Rs.95,89,638 February, 2015

b. Interest for the month of Rs.1,03,69,089 March 2015

c. Installment of Principle due Rs.1,54,23,860 in the month of March 2015

x. The Company has not given any guarantees for loans taken by others from banks or financial institution.

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

xii. Based on the audit procedures performed and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

For KAPOOR TANDON & CO., Chartered Accountants Firm Registration No. 000952C



Rajesh Parasramka Camp: Lucknow Partner Date: 02-05-2015 Membership No. 074192


Mar 31, 2014

Report on the Financial Statements We have audited the accompanying financial statements of Yash Papers Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13.09.2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

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

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

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

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

Emphasis of matter:

Without qualifying our opinion, we draw attention to the note no. 39 relating to recognition of CERs (Certified Emission Reductions) amounting to Rs.15,47,59,000 for the period from April 2007 to December 2012.

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

d. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the accounting standards referred to in sub- section (3C) of Section 211 of the Act read with the General Circular 15/2013 dated 13.09.2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013;

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

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

Annexure to the Auditors'' Report

(Referred to in our report of even date on the financial statements for the financial year ended 31st March, 2014 of Yash Papers Limited)

In terms of the information and explanations given to us and also on the basis of such checks as we considered appropriate, we state that:

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

(b) All the fixed assets have not been physically verified by the management during the year but there is regular programme of physical verification, which in our opinion is reasonable, having regard to the size of the Company and the nature of fixed assets. No material discrepancies have been noticed in respect of the assets physically verified during the year.

(c) The Company has not disposed off substantial part of fixed assets during the year.

ii. (a) The inventories of the Company have been physically verified by the management at regular interval during the year. 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 nature of its business.

(c) The Company is maintaining proper records of inventories. As explained to us, the discrepancies noticed on verification were not material in relation to the operations of the Company.

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

(b) Accordingly, the provisions of clause (iii). (b), (c) and (d) of the Order are not applicable to the Company.

(c) The Company has taken interest free unsecured loan from a Director and other party listed in the register maintained under Section 301 of the Act. The maximum amount and year- end balance of such loan was Rs.126.25 Lacs. Further to aforesaid the Company has accepted deposits (deposit under Section 58A & 58AA of the Act) from Director(s) and other parties listed in the register maintained under Section 301 of the Act. The year-end balance was Rs.17.46 Lacs from 7 such parties.

(d) In our opinion, the terms and conditions on which loans have been taken are, prima facie, not prejudicial to the interest of the Company.

(e) The Company is regular in repaying the principal amount and interest.

iv. In our opinion, there is adequate internal control system commensurate with the size of the Company and nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination 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. (a) In our opinion, particulars of contracts or arrangements referred in Section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion, the Company has complied with the provisions of Section 58A and 58AA of the Act and the rules framed there under for the deposits accepted from the public.

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

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

ix. (a) According to the books and records produced and examined by us, the Company is generally regular in depositing undisputed Statutory dues including Provident Fund, Investors Education and Protection Fund, Income Tax, Sales/Trade Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities and no undisputed amount payable in respect of aforesaid statutory dues were outstanding as at 31st March 2014 for a period of more than six months from the date they become payable.

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

Name of the Statute Nature of the dues Amount (Rs. in Lacs)

The Central Excise Act, Disallowance of CENVAT 188.98 1944 Credit 111.57

Disallowance of CENVAT 0.73 Credit

The Income Tax Act, 1961 Penalty u/s 271(1)(c) 22.61

2.82

The UP Tax on Entry of Entry Tax 2.30 Goods into Local Areas Act, 2007 0.41







Name of the Statute Year(s) to which Forum where pending relates

The Central Excise Act, 1944 2009-10 CESTAT, New Delhi 2010-11

2007-08 CESTAT, New Delhi

The Income Tax Act, 1961 2006-07 CIT Appeals - 2009-10 I, Kanpur

The UP Tax on Entry of Goods into 2008-09 Addl Commissioner Local Areas Act, 2007 2009-10 Appeal, Faizabad

x. The Company does not have accumulated losses of as at the end of the financial year. The Company has not incurred any cash loss in the current financial year as well as in the immediately preceding financial year.

xi. According to the information and explanations given to us and based on the documents and records produced to us, the company has not defaulted in repayment of dues to a financial institution, bank or debenture holders during the year.

xii. The Company has not granted any loans and/or advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund and nidhi / mutual benefit fund / society. Accordingly, the provisions of clause xiii of the Order are not applicable to the Company.

xiv. The Company is not a dealer or trader in securities. Accordingly, the provisions of clause xiv of the Order are not applicable to the Company.

xv. The Company has not given any guarantees for loans taken by others from banks or financial institution.

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

xvii. According to the information and explanations given to us, there are no funds raised on a short term basis which have been used for long term investment.

xviii. As the company has not made any preferential allotment of shares during the year, clause (xviii) of the Order is not applicable to the Company.

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

xx. As the company has not raised any money by way of public issue during the year, clause (xx) of the Order is not applicable to the Company.

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

For KAPOOR TANDON & CO., Chartered Accountants Firm Registration No. 000952C

Rajesh Parasramka Camp: New Delhi Partner Date: May 15, 2014 Membership No. 074192


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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 fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Basis for Qualified Opinion

Other Operating Revenue for the year amounting to Rs.256.30 Lacs represent the income on account of Certified Emission Reductions (CERs) accrued during the year upto December, 2012. The aforesaid income has been recognised in the accounts on the basis of Emission Reduction Purchase Agreement (the Agreement) with Belgian State for sale of CERs generated upto December 2012. This accounting treatment is not in conformity with the "Guidance Note on Accounting of self-generated Certified Emission Reductions (CERs)” issued by the Institute of Chartered Accountants of India (the Guidance Note). Had the company followed the Guidance Note the other operating revenue and profit before tax for the year would have been lower by Rs.256.30 Lacs.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

b. In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books [and proper returns adequate for the purposes of our audit have been received from branches not visited by us];

c. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account [and with the returns received from branches not visited by us];

d. Except for the effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the accounting standards referred to in sub-section (3C) of section 211 of the Act;

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

f Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company. In terms of the information and explanations given to us and also on the basis of such checks as we considered appropriate, we state that:

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

(b) All the fixed assets have not been physically verified by the management during the year but there is regular programme of physical verification, which in our opinion is reasonable, having regard to the size of the Company and the nature of fixed assets. No material discrepancies have been noticed in respect of the assets physically verified during the year.

(c) The Company has not disposed off substantial part of fixed assets during the year.

ii. (a) The inventories of the Company have been physically verified by the management at regular interval during the year. 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 nature of its business.

(c) The Company is maintaining proper records of inventories. As explained to us, the discrepancies noticed on verification were not material in relation to the operations of the Company.

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

(b) Accordingly, the provisions of clause iii. (b), (c) and (d) of the Order are not applicable to the Company.

(c) The Company has taken interest free unsecured loan from a Director. The maximum amount and year-end balance of such loan was Rs.35.00 Lacs. Further to aforesaid the Company has accepted deposits (deposit under Section 58A & 58AA of the Act) from Director(s) and other parties listed in the register maintained under Section 301 of the Act. The year-end balance was Rs.21.99 Lacs from 8 such parties.

(d) In our opinion, the terms and conditions on which loans have been taken are, prima facie, not prejudicial to the interest of the Company.

(e) The Company is regular in repaying the principal amount and interest.

iv. In our opinion, there is adequate internal control system commensurate with the size of the Company and nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination 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. (a) In our opinion, particulars of contracts or arrangements referred in Section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion, the Company has complied with the provisions of Section 58A and 58AA of the Act and the rules framed there under for the deposits accepted from the public.

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

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

ix. According to the books and records produced and examined by us, the Company is generally regular in depositing undisputed Statutory dues including Provident Fund, Investors Education and Protection Fund, Income Tax, Sales/Trade Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities and no undisputed amount payable in respect of aforesaid statutory dues were outstanding as at 31st March 2013 for a period of more than six months from the date they become payable.

x. The Company does not have accumulated losses of as at the end of the financial year. The Company has not incurred any cash loss in the current financial year as well as in the immediately preceding financial year.

xi. According to the information and explanations given to us and based on the documents and records produced to us, the company has not defaulted in repayment of dues to a financial institution, bank or debenture holders during the year.

xii. The Company has not granted any loans and/or advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund and nidhi / mutual benefit fund / society. Accordingly, the provisions of clause xiii of the Order are not applicable to the Company.

xiv. The Company is not a dealer or trader in securities. Accordingly, the provisions of clause xiv of the Order are not applicable to the Company.

xv. The Company has not given any guarantees for loans taken by others from banks or financial institution.

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

xvii. According to the information and explanations given to us, there are no funds raised on a short term basis which have been used for long term investment.

xviii. As the company has not made any preferential allotment of shares during the year, clause xviii of the Order is not applicable to the Company.

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

xx. As the company has not raised any money by way of public issue during the year, clause xx of the Order is not applicable to the Company.

xxi. Based on the audit procedures performed and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year. For KAPOOR TANDON & CO.,

Chartered Accountants

Firm Registration No. 000952C

Rajesh Parasramka

Camp : Faizabad PARTNER

Date : May 25, 2013 Membership No. 074192


Mar 31, 2012

We have audited the attached Balance Sheet of Yash Papers Limited as at 31st March, 2012 and also the Statement of Profit and Loss and the Cash Flow Statement for the financial year ended on that date annexed thereto. These financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

3. Further to our comments in the annexure referred to in paragraph 2 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 these books;

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

d. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211 (3C) of the Act;

e. On the basis of written representations received from the directors as on 31st March, 2012 and taken on record by the Board of Directors, none of the Director is disqualified as on 31st March, 2012 from being appointed as Director in terms of Section 274 (1)(g) of the Act.

f. We draw reference to:

Note no. 40 regarding income of Rs. 343.95 Lacs from Certified Emission Reductions (CERs) accrued for the financial year ended March, 2012.

g. 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 thereon, give the information required by the Act, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:-

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

ii. In the case of the Statement of Profit and Loss, of the Loss of the Company for the financial year ended on that date ; and

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

In terms of the information and explanations given to us and also on the basis of such checks as we considered appropriate, we state that:

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

b) All the fixed assets have not been physically verified by the management during the year but there is regular programme of physical verification, which in our opinion is reasonable, having regard to the size of the Company and the nature of fixed assets. No material discrepancies have been noticed in respect of the assets physically verified during the year.

c) The Company has not disposed off substantial part of fixed assets during the year.

ii. a) The inventories of the Company have been physically verified by the management

at regular interval during the year. 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 nature of its business.

c) The Company is maintaining proper records of inventories. As explained to us, the discrepancies noticed on verification were not material in relation to the operations of the Company.

iii. a) The Company has not granted any loan, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Act.

b) Accordingly, the provisions of clause iii. (b), (c) and (d) of the Order are not applicable to the Company.

c) The Company has taken interest free unsecured loan from a Director. The maximum amount and year-end balance of such loan was Rs. 35.00 Lacs. Further to aforesaid the Company has accepted deposits (deposit under Section 58A & 58AA of the Act) from Director(s) and other parties listed in the register maintained under Section 301 of the Act. The year-end balance was Rs. 27.25 Lacs from 11 such parties.

d) In our opinion, the terms and conditions on which loans have been taken are, prima facie, not prejudicial to the interest of the Company.

e) The Company is regular in repaying the principal amount and interest.

iv. In our opinion, there is adequate internal control system commensurate with the size of the Company and nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination 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. a) In our opinion, particulars of contracts or arrangements referred in Section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion, the Company has complied with the provisions of Section 58A and 58AA of the Act and the rules framed there under for the deposits accepted from the public.

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

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

ix. a) According to the books and records produced and examined by us, the Company is generally regular in depositing undisputed Statutory dues including Provident Fund, Investors Education and Protection Fund, Income Tax, Sales/Trade Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities and no undisputed amount payable in respect of aforesaid statutory dues were outstanding as at 31st March 2012 for a period of more than six months from the date they become payable.

b) According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty, Cess and Service Tax which have not been deposited on account of any dispute, except mentioned as below:

Name of Nature of Amount Year(s) to Forum where

the Statute the dues (Rs. in Lacs) which pending relates

The Central Disallowance of 238.98 2009-10 CESTAT, New Delhi Excise Act, CENVAT Credit 1944 Service Tax on GTA (Freight) 1.25 2004-05 CESTAT, New Delhi

& 05-06

Disallowance of 0.73 2007-08 CESTAT, New Delhi CENVAT Credit

Income Tax Interest and other Income 0.44 2006-07 Commissioner of Act, 1961 earned out of public issue Income Tax (Appeal), proceeds assessed as Income Kanpur from Other Sources

x. The Company does not have accumulated losses of as at the end of the financial year. The Company has not incurred any cash loss in the current financial year as well as in the immediately preceding financial year.

xi. According to the information and explanations given to us, there had been defaults in repayment of term loans, interest thereon and interest on working capital loans during the year. The details of such defaults/irregularities during the year and as on 31st March, 2012 in terms of original sanction(s) is as under:

a. Defaults regularised during the year and in next year:

Interest on Term Loans Rs. 22,56,856 (for the month of June 2011 - paid in April 2012)

Interest on Term Loans Rs. 1,74,73,862 (for the period from April to June 2011 - paid during 2011-12)

Interest on Working Capital Loans - Cash credit Rs. 86,47,390 (for the period from April 2011 to March 2012 - paid during 2011-12)

b. Defaults not regularised:

Default in repayment of Term Loans Rs. 9,78,25,464 (Instalments due in June, September, December 2011 and March 2012)

Interest on Term Loans Rs. 6,65,61,654 (for the period from July 2011 to March 2012)

Irregularity in Working Capital Loans (Cash credit) Rs. 23,87,222 (as on March 31, 2012 - not regularised till date)

However, subsequent to Balance Sheet date i.e. on June 01 2012, the CDR-EG (Corporate Debt Restructuring - Empowered Group) has approved final restructuring package (CDR package) with cut-off date as 01.07.2011. In view of the said CDR package there was no overdue interest and instalment as at 31st March, 2012 in respect of term loans, (refer note no. 5.1 to 5.5 of the Financial Statements)

xii. The Company has not granted any loans and/or advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund and nidhi / mutual benefit fund / society. Accordingly, the provisions of clause xiii of the Order are not applicable to the Company.

xiv. The Company is not a dealer or trader in securities. Accordingly, the provisions of clause xiv of the Order are not applicable to the Company.

xv. The Company has not given any guarantees for loans taken by others from banks or financial institution.

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

xvii. According to the information and explanations given to us, there are no funds raised on a short term basis which have been used for long term investment.

xviii.As the Company has not made any preferential allotment of shares during the year, clause xviii of the Order is not applicable to the Company.

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

xx. As the Company has not raised any money by way of public issue during the year, clause xx of the Order is not applicable to the Company.

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

For Kapoor Tandon & Co.,

Chartered Accountants Firm Registration No. 000952C





Rajesh Parasramka

Camp : New Delhi Partner

Date : 11th August 2012 Membership No. 074192


Mar 31, 2010

We have audited the attached Balance Sheet of Yash Papers Limited as at 31st March, 2010 and also the Profit and Loss Account and the Cash Flow Statement for the financial year ended on that date annexed thereto. These financial statements are the responsibility of the Management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

3. Further to our comments in the annexure referred to in paragraph 2 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 accounts as required by law have been kept by the Company so far as appears from our examination of these books;

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

d. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the applicable Accounting Standards referred to in Section 211 (3C) of the Act;

e. On the basis of written representations received from the directors as on 31st March, 2010 and taken on record by the Board of Directors, none of the Director is disqualified as on 31st March, 2010 from being appointed as Director in terms of Section 274 (1)(g) of the Act.

f. We draw reference to:

Note no. B-20 of Schedule-17 regarding income of Rs. 270.48 lacs from Certified Emission Reductions (CERs) accrued for the financial year ended March, 2010.

Note no. B-21 of Schedule-17 regarding non provisioning of Loss of Rs. 158.95 lacs in respect of disputed Derivative (Structured USD/CHF Option) transaction.

g. 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 thereon, give the information required by the Act, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:- i. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010;

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

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

Annexure to the Auditors Report

(Referred to in paragraph 2 of our report of even date on the financial statements for the financial year ended 31st March, 2010 of Yash Papers Limite In terms of the information and explanations given to us and also on the basis of such checks as we considered appropriate, we state that:

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

b) All the fixed assets have not been physically verified by the management during the year but there is regular programme of physical verification, which in our opinion is reasonable, having regard to the size of the Company and the nature of fixed assets. No material discrepancies have been noticed in respect of the assets physically verified during the year.

c) The Company has not disposed off substantial part of fixed assets during the year.

ii. a) The inventories of the Company have been physically verified by the management at regular interval during the year. 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 nature of its business.

c) The Company is maintaining proper records of inventories. As explained to us, the discrepancies noticed on verification were not material in relation to the operations of the Company.

iii. a) The Company has not granted any loan, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Act.

b) Accordingly, the provisions of clause iii. (b), (c) and (d) of the Order are not applicable to the Company.

c) The Company has taken interest free unsecured loan from a Director. The maximum amount and year-end balance of such loan was Rs. 35.00 lacs. Further to aforesaid the Company has accepted fixed deposit from Director(s) and other parties listed in the register maintained under Section 301 of the Act. The year-end balance was Rs. 19.51 lacs from 12 such parties.

d) In our opinion, the terms and conditions on which loans have been taken are, prima facie, not prejudicial to the interest of the Company.

e) The Company is regular in repaying the principal amount and interest.

iv. In our opinion, there is adequate internal control system commensurate with the size of the Company and nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination 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. a) In our opinion, particulars of contracts or arrangements referred in Section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion, the Company has complied with the provisions of Section 58A and 58AA of the Act and the rules framed there under for the deposits accepted from the public.

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

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

ix a) According to the books and records produced and examined by us, the Company is generally regular in depositing undisputed Statutory dues including Provident Fund, Investors Education and Protection Fund, Income Tax, Sales/Trade Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues as applicable with the appropriate authorities and no undisputed amount payable in respect of aforesaid statutory dues were outstanding as at 31st March, 2010 for a period of more than six months from the date they become payable.

b) According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Excise Duty, Cess and Service Tax which have not been deposited on account of any dispute, except mentioned as below:



Name of Nature of Amount Year(s) to Forum where

the Statute the dues (Rs. in Lacs) which pending

relates

The Central Penalty 0.17 1995-96 CESTAT, New Delhi

Excise Act, Service Tax on GTA (Freight) 1.25 2004-05 CESTAT, New Delhi

1944 & 05-06

Disallow- ance of 1.05 2007-08 Commissioner of Central

CENVAT Credit Excise (Appeal), Allahabad

Income Tax Interest and other Income 12.50 2006-07 Commissioner of Income

Act, 1961 earned out of public issue Tax (Appeal), Kanpur

proceeds assessed as Income

from Other Sources





x. The Company has accumulated losses of Rs. 168.27 lacs which is not more than 50% of its Net Worth. The Company has not incurred any cash loss in the current financial year as well as 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 and/or banks during the year.

xii. The Company has not granted any loans and/or advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is not a chit fund and nidhi / mutual benefit fund / society. Accordingly, the provisions of clause xiii of the Order are not applicable to the Company.

xiv. The Company is not a dealer or trader in securities. Accordingly, the provisions of clause xiv of the Order are not applicable to the Company.

xv. The Company has not given any guarantees for loans taken by others from banks or financial institution.

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

xvii. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, in our opinion, there are no funds raised on a short term basis which have been used for long term investment.

xviii.As the company has not made any preferential allotment of shares during the year, clause xviii of the Order is not applicable to the Company.

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

xx. As the company has not raised any money by way of public issue during the year, clause xx of the Order is not applicable to the Company.

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

For Kapoor Tandon & Co.,

Chartered Accountants



Rajesh Parasramka

Partner

Camp : Faizabad Membership No. 74192

Date : August 12, 2010 Firm Registration No. 000952C



 
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