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Auditor Report of Zenith Fibres Ltd.

Mar 31, 2015

Report on the Financial Statements

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

Management's Responsibility for the Financial Statements

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

Auditor's Responsibility

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

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

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

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

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

Opinion

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

Report on Other Legal and Regulatory Requirements

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

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 24(i) and 24(ix) to the financial statements;

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

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

Annexure referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of the Auditor's Report to the members of Zenith Fibres Limited for the year ended 31st March, 2015

i) (a) The Company is maintaining records showing particulars including quantitative details.

(b) These fixed assets have been physically verified by the management at reasonable intervals. We are informed that no material discrepancies were noticed on such verification;

ii) (a) The inventory has been physically verified during the year by the management. 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 inventory 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 inventory. No Material discrepancies were noticed on physical verification thereof.

iii) The Company has not granted any loans, secured or unsecured, to companies, firm or other parties covered in the register maintained under section 189 of the Companies Act, 2013 and therefore, the matters referred in paragraph (iii) (a) and (b) of the order are not applicable.

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. There was no sale of services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v) The Company has not accepted deposits in contravention of the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under, as applicable.

vi) According to the information and explanations given to us, the company is not required to maintain cost records as specified by the Central Government under sub-section (1) of the section 148 of the Companies Act, 2013.

vii) According to the information and explanations given to us and as shown by our examination of the books of accounts:

(a) The company is regular in depositing 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 statutory dues applicable to it and no undisputed amounts payable in respect thereof were in arrears, as on the last day of the financial year, for a period of more than six months from the date they became payable.

(b) There are no dues of income tax or sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax or cess which have not been deposited on account of any dispute except demand to the extent of Rs.90,48,505/- of Excise Duty and Penalty under the Central Excise Act, 1944 pertaining to the Financial year 2010-11 against which appeal is pending before the Excise Tribunal.

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

viii) The company has no accumulated losses at the end of the financial year and it has not incurred cash losses during the financial year and in the immediately preceding financial year.

ix) The company has not defaulted in repayment of dues to a financial institution or bank or debenture holders.

x) The company has not given any guarantee for loans taken by others from bank or financial institutions.

xi) In our opinion, and according to the information and explanations given to us, the term loans were applied for the purpose for which the loans were obtained.

xii) 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 Jain & Hindocha

Chartered Accountants

Firm Reg. No. 103868W

(Jaswant Jain)

Place: Vadodara Partner

Date:May 30, 2015 (M. No. 035126)


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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 due to fraud or 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 misstatement.

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 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.

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, the financial statements give the information required by the At t 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

7. As required by the Companies (Auditor''s Report) Order, 2003 as amended by ''the Companies (Auditor''s Report) Order, 2004 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 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 the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

8. 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 jy the Company so far as appears from our examination of those books;

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

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e) on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure to the Auditors'' Report to the members of Zenith Fibres Limited for the year ended 31" March, 2013

(Referred to in Paragraph 3 of our report of even date)

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

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

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

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

iii) As per the information 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 Companies Act, 1956. In view of this sub clause (b), (c) (d), (f) and (g) are not applicable.

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. There are no sales of services. Further, on the basis of our examination of books and records of the company and according to information and explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the internal control system.

v) According to the information and explanations given to us,

(a) We are of the opinion that particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered in the Register maintained under that section have been so entered;

(b) There are no transactions made in pursuance of such contracts or arrangements that exceed the value of rupees five lacs in aggregate with any party during the year.

vi) The Company has not accepted deposits from the public to which the provisions of sections 58A, 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 would apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business. viii) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company, pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained;

ix) According to the information and explanations given to us and according to the books and records as produced;

x) The Company is regular in depositing with the appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth Tax,

Custom Duty, Excise Duty, cess and other material statutory dues applicable to it and no undisputed amounts payable in respect thereof were in arrears, as on the last day of the financial year, for a period of more than six months from the date they became payable.

a) According to Information and Explanation given to us, provisions of the Employees'' State Insurance Act, 1948 are not applicable to the Company;

b) There are no dues of sales-tax/income-tax/custom tax/wealth tax/excise duty/cess which have not 1 been deposited on account of any dispute.

xi) The Company does not have any accumulated losses as at the end of the f; iz rcial year. Also, the J company has not incurred cash losses during the financial year and in the immediately preceding financial year;

xii) According to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank. The company has not issued any debentures.

xiii) According to the information and explanation given to us, The Company has not granted any loans or advances on the basis of any security by way of pledqe of shares, debentures and other securities;

xiv) The Company is not a chit fund or a nidhi/mutual ben afit fund/society. Therefore, the provisions of clause 4(xiii) of the said Order are not applicable to the company; .

xv) In our opinion and according to information and explanation given to us, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the said Order are not applicable to the company;

xvi) According to the information and explanation given to us, the company has not given any guarantee for loans taken by others from Banks or Financial Institutions.

xvii) According to information and explanation given to us and on the basis of records examined by us, the term loans were applied for the purpose for which the loans were obtained.

xviii) According to the information and explanations given to us and on the basis of an overall examination of the Balance Sheet of the company, we report that no funds raised on short-term basis have been used for long term investment by the company.

xix) The Company has not made any preferential allotment of shares to the parties and companies covered in the Register maintained under section 301 of the Act, during the year.

xx) The Company had not issued any debentures during the year. Accordingly, question of creating any security or charge for debentures does not arise.

xxi) The Company has not raised any money by public issue during the year.

xxii) To the best of knowledge 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 Jain & Hindocha

Chartered Accountants

(FRN No.103868W)

Place: Vadodara (Jaswant Jain)

Date: 25th May,2013 Partner

Membership No.35126


Mar 31, 2012

1. We have audited the attached Balance sheet of Zenith Fibres Limited as at 31st March,2012, 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 Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance 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 the 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 as amended by the Companies(Auditor's Report) order,2004('the order') issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 we enclose in the Annexure a statement on the matters specified in the Paragraph 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to 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 and Profit and Loss Account dealt with by this report are in agreement with the books of account.

d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the companies Act,1956.

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, we report that none of the directors of the Company is disqualified as on 31st March,2012 from being appointed as a director, in terms of clause (g) of sub section (1) of Section 274 of the Companies Act, 1956.

In our opinion and to the best of our information and according to explanations given to us, the said accounts, read together with the Significant Accounting Policies and other notes there on appended thererto, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i) in the case of the Balance sheet, of the state of affairs of the company as at 31st March, 2012;

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.

ANNEXURETOTHE AUDITORS' REPORTTOTHE MEMBERS OF ZENITH FIBRES LIMITED FORTHEYEAR ENDED 31 ST MARCH, 2012

(Referred to in Paragraph 3 of our report of even date)

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

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

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

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

(iii) As per the information 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 Companies Act, 1956. In view of this sub clause (b), (c) (d), (f) and (g) are not applicable.

(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. There are no sale of services. Further, on the basis of our examination of books and records of the company and according to information and explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the internal control system.

(v) According to the information and explanations given to us,

(a) we are of the opinion that particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered in the Register maintained under that section have been so entered;

(b) there are no transactions made in pursuance of such contracts or arrangements that exceed the value of rupees five lacs in aggregate with any party during the year.

(vi) The Company has not accepted deposits from the public to which the provisions of sections 58A, 58AA or any other relevant provisions of the Act and the Companies(Acceptance of Deposits) Rules, 1975 would apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

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

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

(ix) According to the information and explanations given to us and according to the books and records as produced;

a) the Company is regular in depositing with the appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth Tax, Custom Duty, Excise Duty, cess and other material statutory dues applicable to it and according to the information and explanations given to us, no undisputed amounts payable in respect thereof were in arrears, as on the last day of the financial year, for a period of more than six months from the date they became payable.

b) According to Information and Explanation given to us, provisions of the Employees' State Insurance Act, 1948 are not applicable to the Company;

c) As on last day of the Financial year, there are no dues of sales-tax/income-tax/custom tax/wealth tax/excise duty/ cess which have not been deposited on account of any dispute.

(x) The Company does not have any accumulated losses as at the end of the financial year. Also, the company has not incurred cash losses during the financial year and in the immediately preceding financial year;

(xi) According to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank. The company has not issued any debentures.

(xii) According to the information and explanation given to us, The Company has not granted any loans or advances on the basis of any 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. Therefore, the provisions of clause 4(xiii) of the said Order are not applicable to the company;

(xiv) In our opinion and according to information and explanation given to us, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the said Order are not applicable to the company;

(xv) According to the information and explanation given to us, the company has not given any guarantee for loans taken by others from Banks or Financial Institutions.

(xvi) According to information and explanation given to us and on the basis of records examined by us, the term loans were applied for the purpose for which the loans were obtained.

(xvii) According to the information and explanations given to us and on the basis of an overall examination of the Balance Sheet of the company, we report that no funds raised on short-term basis have been used for long term investment by the company.

(xviii) The Company has not made any preferential allotment of shares to the parties and companies covered in the Register maintained under section 301 of the Act, during the year.

(xix) The Company had not issued any debentures during the year. Accordingly, question of creating any security or charge for debentures does not arise.

(xx) The Company has not raised any money by public issue during the year.

(xxi) To the best of knowledge 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 Jain & Hindocha

(Reg.No.103868W)

Chartered Accountants

Place: Vadodara (Jaswant Jain)

Date : 28th May, 2012 Partner

Membership No.35126


Mar 31, 2010

1. We have audited the attached Balance sheet of Zenith Fibres Limited as at 31st 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 auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies(Auditors Report) order,2004(the order) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act,1956 we enclose in the Annexure a statement on the matters specified in the Paragraph 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to 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 and Profit and Loss Account dealt with by this report are in agreement with the books of account.

d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the companies Act,1956.

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

f) In our opinion and to the best of our information and according to explanations given to us, the said accounts, read together with the Significant Accounting Policies and other notes there on, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i) in the case of the Balance sheet, of the state of affairs of the company as at 31st March, 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 TO THE AUDITORS REPORT TO THE MEMBERS OF ZENITH FIBRES LIMITED FOR THE YEAR ENDED 31 ST MARCH, 2010

(Referred to in Paragraph 3 of our report of even date)

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

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

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

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

Mi) As per the information 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 Companies Act,1956. In view of this sub clause (b), (c) (d), (f) and (g) are not applicable.

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. There are no sale of services. Further, on the basis of our examination of books and records of the company and according to information and explanation given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the internal control system.

v) According to the information and explanations given to us,

(a) we are of the opinion that particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered in the Register maintained under that section have been so entered;

(b) there are no transactions made in pursuance of such contracts or arrangements that exceed the value of rupees five lacs in aggregate with any party during the year.

vi) The Company has not accepted deposits from the public to which the provisions of sections 58A, 58AA or any other relevant provisions of the Act and the Companies(Acceptance of Deposits) Rules,1975 would apply. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

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

viii) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company, pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained;

ix) According to the information and explanations given to us and according to the books and records as produced;

a) The Company is regular in depositing with the appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth Tax, Custom Duty, Excise Duty, cess and other material statutory dues applicable to it and no undisputed amounts payable in respect thereof were in arrears, as on the last day of the financial year, for a period of more than six months from the date they became payable.

b) According to Information and Explanation given to us, provisions of the Employees State Insurance Act, 1948 are not applicable to the Company;

c) According to Information and Explanation given to us, following dues in respect of Income-tax have not been deposited with the Income tax Department on account of dispute:

Amount(Rs.) Forum where dispute is pending Assessment Year

114136 Income Tax Appellate Tribunal 2004-05



Other than above there are no dues of sales-tax/income-tax/custom duty/wealth tax/excise duty/cess which have not been deposited on account of any dispute.

x) The Company does not have any accumulated losses as at the end of the financial year. Also, the company has not incurred cash losses during the financial year and in the immediately preceding financial year;

xi) According to the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank. The company has not issued any debentures.

xii) According to the information and explanation given to us, the Company has not granted any loans or advances on the basis of any 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. Therefore, the provisions of clause 4

(xiii) of the said Order are not applicable to the company; xiv) In our opinion and according to information and explanation given to us, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4

(xiv) of the said Order are not applicable to the company;

xv) According to the information and explanation given to us, the company has not given any guarantee for loans taken by others from Banks or Financial Institutions.

xvi) According to information and explanation given to us and on the basis of records examined by us, the term loans were applied for the purpose for which the loans were obtained.

xvii) According to the information and explanations given to us and on the basis of an overall examination of the Balance Sheet of the company, we report that no funds raised on short-term basis have been used for long term investment by the company.

xviii)The Company has not made any preferential allotment of shares to the parties and companies covered in the Register maintained under section 301 of the Act, during the year.

xix) The Company had not issued any debentures during the year. Accordingly, question of creating any security or charge for debentures does not arise. xx) The Company has not raised any money by public issue during the year. xxi) To the best of knowledge 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 Jain & Hindocha

(Reg.No.103868W)

Chartered Accountants

Place: Vadodara (Jaswant Jain)

Date : 26th July 2010 Partner

Membership No.35126



 
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