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Auditor Report of Alembic Pharmaceuticals Ltd.

Mar 31, 2017

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Alembic Pharmaceuticals Limited (“the Company”), which comprise the Balance Sheet as at 31st March, 2017, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the Significant Accounting Policies and Other Explanatory Information.

Management’s Responsibility for the Standalone Ind AS Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these standalone Ind AS 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 of the standalone Ind AS financial statements 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 standalone Ind AS financial statements are free from material misstatement.

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

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

Opinion

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in “Annexure A” 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, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements; refer note no 27.2.

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

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

iv The Company has provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 at Note No. 38 and these are in accordance with the books of accounts maintained by the Company.

Annexure ‘A’ to the Independent Auditor’s Report

Re: Alembic Pharmaceuticals Limited.

Referred to in paragraph 1 on Report on Other Legal and Regulatory Requirements of our report.

(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 during the year as per the phased programme of physical verification of fixed assets. As informed to us the programme is such that all the fixed assets will get physically verified in three year time. In our opinion the same is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) The title deeds of immovable properties are held in the name of the company.

(ii) Physical verification of inventory has been conducted at reasonable intervals by the management and No material discrepancies were noticed on physical verification.

(iii) The Company has not granted any secured or unsecured loans to companies, firms, limited liability partnership or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Therefore the requirements of sub-clause (a), (b) and (c) of clause (iii) are not applicable to the Company.

(iv) In respect of loans, investments, guarantees, and security provisions of section 185 and 186 of the Companies Act, 2013 have been complied with.

(v) The Company has not accepted any deposits during the year. Therefore the question of complying with 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 thereunder do not arise.

(vi) The Central Government has specified the maintenance of cost records under sub-section (1) of section 148 of the Companies Act, 2013. Such accounts and records have been made and maintained by the Company.

(vii) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund, employees’ state insurance, income tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues with the appropriate authorities.

(b) Dues of income tax or sales tax or service tax or duty of customs or duty of excise or value added tax that have not been deposited on account of any dispute are on the next page.

Nature of dues

Amount not deposited Rs.

Forum where dispute is pending

Period to which the amount relates

Sales Tax, interest and penalty

13,12,295

High Court

1999-2000

1,63,84,603

Asst. Commissioner Demand

2003-04

44,830

Additional Commissioner

2004-05

1,53,406

Revisional Board (Tribunal)

2006-07

20,92,750

Jt. Commissioner Appeals

2013-14

7,65,686

Jt. Commissioner Appeals

2006-07

8,27,211

Tribunal

2009-10

7,81,346

Tribunal

2009-10

1,84,321

Additional Commissioner

01-04-2006 to 30-11-2008

15,06,831

Additional Commissioner

2007-08

36,46,047

Revisional Authority

2012-13

Central Sales Tax

1,51,971

Additional Commissioner

01-04-2006 to 30-11-2008

10,93,955

Deputy Commissioner II

2006-07

4,837

Tribunal

2009-10

1,23,800

Jt. Commissioner Appeals

2006-07

3,24,342

Jt. Commissioner Appeals

2010-11

Excise Duty, Interest & Penalty

2,13,95,574

CESTAT

2005-06

9,85,233

CESTAT

2011-12

16,091

CESTAT

2007-08

2,10,579

CESTAT

1998-99

35,000

Commissioner (Appeal)

2009-10

50,03,165

High Court

2005-06

1,20,99,486

High Court

2005-06

55,306

CESTAT

2008-09

121,276

CESTAT

2010-11

10,181,463

CESTAT

2006 to 2011

24,11,210

Commissioner (Appeals)

2013-14

2,75,323

CESTAT

2007-08 to July 2011

56,760

CESTAT

2011-12

4,12,504

Commissioner (Appeals)

2013-14

3,45,902

CESTAT

2012-13

1,18,282

CESTAT

2013-14

1,26,179

Commissioner Appeals

2006 to 2011

25,23,209

CESTAT

2011 to 2015

27,99,431

CESTAT

2015-16

3,18,507

CESTAT

2014-15

3,68,256

CESTAT

2014-15

35,964

CESTAT

2012 to 2014

Stamp duty

5,01,18,535

Supreme Court

2011-12

(viii) The Company has not defaulted in repayment of loans or borrowings to a financial institution, bank, government or dues to debenture holders.

(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) or any term loans during the year.

(x) Any fraud by the Company or any fraud on the Company by its officers or employees has not been noticed or reported during the year.

(xi) Managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act.

(xii) The Company is not a Nidhi Company and therefore the compliance requirements relevant to a Nidhi Company are not applicable.

(xiii) All transactions with related parties are in compliance with section 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in the standalone Ind AS financial statements etc. as required by the applicable accounting standards.

(xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review, therefore the compliance of the requirement of section 42 of the Companies Act, 2013 are not applicable.

(xv) Pursuant to the provisions of section 192 of the Companies Act, 2013, the Company has not entered into any non-cash transactions with directors or persons connected with him/her.

(xvi) The Company is not required to be registered under section 45-1(A) of the Reserve Bank of lndia Act, 1934.

For K.S.AIYAR & Co

Chartered Accountants

Firm Registration Number: 100186W

RAGHUVIR M. AIYAR

Mumbai Partner

Date: 3rd May, 2017 Membership No. 38128


Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act").

Read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity''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 accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

d. in our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

e. on the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Referred to in paragraph 1 on Report on Other Legal and Regulatory Requirements of our report.

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets. However, item wise value in respect of assets other than land, buildings and vehicles prior to 1982 are not available.

(b) Fixed assets have been physically verified by the management during the year as per the phased programme of physical verification of fixed assets. As informed to us the programme is such that all the fixed assets will get physically verified in three years time. In our opinion the same is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) During the year, the Company has not disposed off any substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified during the year by the management at reasonable intervals.

(b) The procedures for physical verification of inventory followed by the management are reasonable and adequate in relation to 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) (a) The Company has granted unsecured loan to one company covered in the register maintained under section 301 of the Companies Act, 1956 wherein the balance recoverable as at the year end is Rs. Nil (Maximum balance during the year Rs. 4,205 Lacs).

(b) In our opinion, the rate of interest and other terms and conditions of loans given by the Company, secured or unsecured, to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima-facie, prejudicial to the interest of the Company.

(c) In respect of the above loans granted, receipt/renewal of the principal amount and interest were regular, as stipulated.

(d) There is no overdue amount of more than rupees one lakh of loans granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company has not taken any unsecured loan from any party covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the requirement of clause (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 purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding Rs. 5,00,000 have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with provisions of Section 58A and 58AA and any other relevant provision of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. No order has been passed by the Company Law Board, 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 its 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. However, we have not made a detailed examination of the records for determining whether they are accurate or complete.

(ix) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee''s State Insurance, Income

Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues applicable to it and there are no arrears outstanding as at the year end for a period of more than six months from the date they became payable.

(b) According to the records of the Company, the following dues of Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess have not been deposited on account of some dispute or are partially deposited under protest.

Statute & Nature of dues Amount not Forum where dispute Period deposited in Rs. is pending

Sales Tax Act 4,82,244 Joint Commissioner Appeals 2008-09

Sales Tax, Interest and penalty 13,12,295 High Court 1999-2000

1,63,84,603 Asst.Commissioner Demand 2003-04

44,830 Additional Commissioner 2004-05

1,53,406 Sr.Joint Commissioner 2006-07

17,49,933 Joint Commissioner Appeals 2009-10

1,84,321 Additional Commissioner 01-04-2006 to 30-11-2008

24,654 Additional Commissioner 01-12-2008 to 31-10-2009

34,11,482 Additional Commissioner 2007-08

53,89,411 Additional Commissioner 2008-09

64,32,292 Additional Commissioner 2009-10

2,95,000 Joint Commissioner Appeals 2013-14

9,56,484 Jt.Comissioner, Commercial Tax 2010-11

Central Sales Tax Act 1,51,971 Additional Commissioner 01-04-2006 to 30-11-2008

75,612 Additional Commissioner 01-12-2008 to 31-10-2009

2,46,931 Deputy Commissioner II 2003-04

1,50,355 Joint Commissioner (Appeals) 2005-06

10,93,955 Deputy Commissioner II 2006-07

26,302 Additional Commissioner 2008-09

28,481 Additional Commissioner 2009-10

1,52,810 Jt.Commissioner, Commercial tax 2010-11

The Central Excise Act 2,13,95,574 CESTAT 2005-06

Excise Duty, Interest & Penalty 56,07,997 CESTAT 2007-08

16,091 Commissioner (Appeal) 2007-08 23,53,824 CESTAT 2001-02

2,10,579 CESTAT 1998-99

35,000 Commissioner (Appeal) 2009-10

50,03,165 High Court 2005-06

1,20,99,486 High Court 2005-06



Statute & Nature of dues Amount not Forum where dispute Period deposited in Rs. is pending

55,306 Commissioner (Appeals) 2008-09

1,21,276 Commissioner (Appeals) 2010-11

1,01,81,463 CESTAT 2006-11

34,712 Asst. Commissioner 2007-08

2,75,323 CESTAT 2007-08 to July 2011

56,760 CESTAT 2011-12

95,029 CESTAT 2011-12

The Bombay Stamp Act 5,01,18,535 Supreme Court 2011-12

Income Tax Act 3,19,955 Commissioner (Appeals) 2010-11

Income Tax 4,58,530 Commissioner (Appeals) 2011-12

4,53,951 Commissioner (Appeals) 2012-13



(x) As the Company is registered for a period less than 5 years, the requirement of the Order of reporting on accumulated losses and cash losses is not applicable.

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

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

(xiii) The Company is not a Chit Fund or a Nidhi/Mutual Benefit Fund/Society. Therefore, the provisions of Clauses 4(xiii) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

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

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

(xix) The Company does not have any Debentures outstanding as at the year end.

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

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



For K.S.Aiyar & Co;

Chartered Accountants

Firm Registration No: 100186W



RAGHUVIR M. AIYAR

Mumbai Partner

Date: 28th April, 2014 Membership No. 38128


Mar 31, 2013

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 2|| of the Companies Act, |956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

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

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

Referred to in paragraph 1 on Report on Other Legal and Regulatory Requirements of our report.

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets. However, item wise value in respect of assets other than land, buildings and vehicles prior to 1982 are not available.

(b) Fixed assets have been physically verified by the management during the year as per the phased programme of physical verification of fixed assets. As informed to us the programme is such that all the fixed assets will get physically verified in three years time. In our opinion the same is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) During the year, the Company has not disposed off any substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified during the year by the management at reasonable intervals.

(b) The procedures for physical verification of inventory followed by the management are reasonable and adequate in relation to 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) (a) The Company has granted unsecured loan to one company covered in the register maintained under section 301 of the Companies Act, 1956 wherein the balance recoverable as at the year end is H Nil (Maximum balance during the year H 7,950 Lacs).

(b) In our opinion, the rate of interest and other terms and conditions of loans given by the Company, secured or unsecured, to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima-facie, prejudicial to the interest of the Company.

(c) In respect of the above loans granted, receipt/renewal of the principal amount and interest were regular, as stipulated.

(d) There is no overdue amount of more than rupees one lakh of loans granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company has not taken any unsecured loan from any party covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the requirement of clause (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 purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding ''5,00,000 have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with provisions of Section 58A and 58AA or any other relevant provision of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. No order has been passed by the Company Law Board, 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 its 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 (l)(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. However we have not made a detailed examination of the records for determining whether they are accurate or complete.

(ix) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee''s State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues applicable to it and there are no arrears outstanding as at the year end for a period of more than six months from the date they became payable.

(b) According to the records of the Company the following dues of Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty Excise Duty and Cess have not been deposited on account of some dispute or are partially deposited under protest.

(x) As the Company is registered for a period less than 5 years, the requirement of the Order of reporting on accumulated losses and cash losses is not applicable.

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

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

(xiii) The Company is not a Chit Fund or a Nidhi/Mutual Benefit Fund/Society Therefore, the provisions of Clauses 4(xiii) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

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

(xviii)The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

(xix) The Company does not have any Debentures outstanding as at the year end.

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

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

For K.S. Aiyar & Co;

Chartered Accountants

FRN: 100186W

Raghuvir M.Aiyar

Mumbai Partner

Date: 2nd May 2013 Membership No.38128


Mar 31, 2012

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

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

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

Further to our comments in the Annexure referred to above, we report that:

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

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

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

(iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 2II of the Companies Act, 1956

(v) 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 is disqualified as on 31st March, 20I2 from being appointed as a Director in terms of clause (g) of sub-section(I) of section 274 of the Companies Act, 1956;

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

a) in the case of the Balance Sheet of the state of the affairs of the Company as at 31st March, 2012;

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

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

Referred to in paragraph 3 of our report of even date,

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets. However, item wise value in respect of assets other than land, buildings and vehicles prior to 1982 are not available.

(b) Fixed assets have been physically verified by the management during the year as per the phased programme of physical verification of fixed assets. As informed to us the programme is such that all the fixed assets will get physically verified in three years time. In our opinion the same is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) During the year, the Company has not disposed off any substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified during the year by the management at reasonable intervals.

(b) The procedures for physical verification of inventory followed by the management are reasonable and adequate in relation to 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) (a) The Company has granted unsecured loans to three companies covered in the register maintained under section 301 of the Companies Act, 1956 wherein the balance recoverable as at the year end is Rs6300 Lacs (Maximum balance during the year Rs 11850 Lacs).

(b) In our opinion, the rate of interest and other terms and conditions of loans given by the Company, secured or unsecured, to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima- facie, prejudicial to the interest of the Company.

(c) In respect of the above loans granted, receipt/renewal of the principal amount and interest were regular, as stipulated.

(d) There is no overdue amount of more than rupees one lakh of loans granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company has not taken any unsecured loan from any party covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the requirement of clause (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 purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding Rs5,00,000 have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with provisions of Section 58A and 58AA or any other relevant provision of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. No order has been passed by the Company Law Board, 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 its 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 (I)(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. However, we have not made a detailed examination of the records for determining whether they are accurate or complete.

(ix) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee's State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues applicable to it and there are no arrears outstanding as at the year end for a period of more than six months from the date they became payable.

(b) According to the records of the Company, the following dues of Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess have not been deposited on account of some dispute or are partially deposited under protest.

Amount not Forum where Statute & Nature of dues deposited Period dispute is pending

Sales Tax Act 4,82,244 Joint Commissioner Appeals 2008-09 Sales Tax, interest and penalty.

13,12,295 High Court 1999-2000

1,63,84,603 Asst.Commissioner Demand 2003-04

44,830 Additional Commissioner 2004-05

276,334 Sr.Joint Commissioner 2006-07

17,49,933 Joint Commissioner Appeals 2009-10

1,84,321 Additional Commissioner 01-04-2006 to 30-11-2008

24,654 Additional Commissioner 01-12-2008 to 31-10-2009

34,11,482 Additional Commissioner 2007-08

53,89,411 Additional Commissioner 2008-09

Central Sales Tax Act 5,20,052 Commissioner 2005-06

1,51,971 Additional Commissioner 01-04-2006 to 30-11-2008

75,612 Additional Commissioner 01-12-2008 to 31-10-2009

2,46,931 Deputy Commissioner II 2003-04

1,50,355 Joint Commissioner (Appeals) 2005-06

10,93,955 Deputy CommissionerII 2006-07

26,302 Additional Commissioner 2008-09

The Central Excise Act 2,13,95,574 CESTAT, Comm.( A) 2005-06 Excise Duty, Interest & Penalty. 56,58,800 CESTAT, Comm. (A) 2007-08

23,53,824 CESTAT, Comm. (A) 2001-02

2,10,579 CESTAT, Comm. (A) 1998-99

35,000 CESTAT, Comm. (A) 2009-10

50,03,165 High Court 2005-06

1,20,99,486 High Court 2005-06

1,01,19,859 Deputy Commissioner 2001-02

50,11,283 Deputy Commissioner 2006-07

17,03,220 Deputy Commissioner 1996-97

1,15,584 Deputy Commissioner 2001-02

11,316 Deputy Commissioner 2007-08

1,138 Deputy Commissioner 2009-10

25,153 Deputy Commissioner 2008-09

1,18,111 Deputy Commissioner 2008-09

55,306 Deputy Commissioner 2008-09

25,183 Deputy Commissioner 2009-10

47,936 Deputy Commissioner 2009-10

1,12,061 Deputy Commissioner 2009-10

21,688 Deputy Commissioner 2010-11

34,268 Deputy Commissioner 2010-11

13,588 Deputy Commissioner 2011-12

1,21,276 Deputy Commissioner 2010-11

47,151 Deputy Commissioner 2010-11

1,01,81,463 Commissioner 2006-11

The Bombay Stamp Act. 5,01,18,535 The Hon'ble Chief Controlling 2011-12 Revenue Authority, Gandhinagar

(x) As the Company is registered for a period less than 5 years, the requirement of the Order of reporting on accumulated losses and cash losses is not applicable.

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

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

(xiii) The Company is not a Chit Fund or a Nidhi/Mutual Benefit Fund/Society. Therefore, the provisions of Clauses 4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

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

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

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

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

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

For K. S. AIYAR & CO.

Chartered Accountants;

FRN:100186W

RAGHUVIR M. AIYAR

Mumbai Partner

DATE: 26th April, 2012 Membership No.38128


Mar 31, 2011

We have audited the attached Balance Sheet of Alembic Pharmaceuticals Limited as at 31st March, 2011, the Profit and Loss Account and also the Cash Flow Statement for the period from date of incorporation i.e.16th June, 2010 to 31st March, 2011 annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We state that the ‘Pharmaceutical undertaking' of Alembic Limited got demerged and transferred to the Company pursuance to the Scheme of Arrangement as approved by the Hon'ble Gujarat High Court. Accordingly these financial statements include the Financial Statements of the said ‘Pharmaceutical undertaking' of Alembic Limited for the period from the Appointed date i.e. 01-04-2010 to 31-03-2011.

We further state that these Financial Statements pertaining to the said Pharmaceutical undertaking have been extracted from the books of account and records maintained by Alembic Limited jointly with its Vadodara undertaking in its SAP ERP system. This extraction and compilation of Financial Statements of the said Pharmaceutical undertaking is as envisaged in the Scheme and is based on various allocations made by the management on reasonable bases as detailed in Note No. 2 of Schedule T to the Financial Statements and have been relied upon by us.

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

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

Further to our comments in the Annexure referred to above, we report that:

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

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

(iii) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account maintained as disclosed at Para 3 above;

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

(v) On the basis of written representations received from the Directors, as on 31st March, 2011, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as a Director in terms of clause (g) of sub-section(1) of section 274 of the Companies Act, 1956;

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

a) in the case of the Balance Sheet of the state of the affairs of the Company as at 31st March, 2011;

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

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

Annexure to the Auditors' Report Re : Alembic Pharmaceuticals Limited Referred to in paragraph 3 of our report of even date,

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets. However, item wise value in respect of assets other than land, buildings and vehicles acquired prior to 1982 are not available.

(b) Fixed assets have been physically verified by the management during the year as per the phased programme of physical verification of fixed assets. As informed to us the programme is such that all the fixed assets will get physically verified in three years time. In our opinion the same is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

(c) During the year, the Company has not disposed off substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified during the year by the management at reasonable intervals.

(b) The procedures for physical verification of inventory followed by the management are reasonable and adequate in relation to 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) (a) The Company has granted unsecured loans to five companies covered in the register maintained under section 301 of the Companies Act, 1956 wherein the balance recoverable as at the period end is Rs.26,40,00,000/- (Maximum balance during the year Rs.80,96,00,000/-).

(b) In our opinion, the rate of interest and other terms and conditions of loans given by the Company, secured or unsecured, to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima- facie, prejudicial to the interest of the Company.

(c) In respect of the above loans granted, receipt/renewal of the principal amount and interest were regular, as stipulated.

(d) There is no overdue amount of more than rupees one lakh of loans granted to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company has not taken any unsecured loan from any party covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the requirement of clause (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 purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

(v) (a) The particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding Rs.5,00,000 have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with provisions of Section 58A and 58AA or any other relevant provision of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. No order has been passed by the Company Law Board, 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 its 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. However, we have not made a detailed examination of the records for determining whether they are accurate or complete.

(ix) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including

Provident Fund, Investor Education and Protection Fund, Employee's State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues applicable to it and there are no arrears outstanding as at the year end for a period of more than six months from the date they became payable.

(b) According to the records of the Company, the following dues of Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess have not been deposited on account of some dispute or are partially deposited under protest.

Statue & Nature Amount not Forum where Period of dues. deposited dispute is pending.

Sales Tax Act. 4,82,244 Joint Commissioner 2008-09 Sales Tax, Appeals interest and penalty.

13,12,295 High Court 1999-2000

1,63,84,603 Asst. Commissioner Demand 2003-04

44,830 Additional Commissioner 2004-05

3,99,262 Sr. Joint Commissioner 2006-07

17,49,933 Joint Commissioner Appeals 2009-10

7,38,67,430 Additional Commissioner (Appeals) 2007-08

1,84,321 Additional Commissioner 01-04-2006 to 30-11-2008

24,654 Additional Commissioner 01-12-2008 to 31-10-2009

34,11,482 Additional Commissioner 2007-08

Central Sales Tax 1,00,00,000 Additional Commissioner Appeals 2007-08

5,20,052 Commissioner 2005-06

1,51,971 Additional Commissioner 01-04-2006 to 30-11-2008

75,612 Additional Commissioner 01-12-2008 to 31-10-2009

2,46,931 Deputy Commissioner II 2003-04

1,50,355 Joint Commissioner (Appeals) 2005-06

10,93,955 Deputy Commissioner II 2006-07

71,728 Sr. Joint Commissioner 2006-07

The Central Excise Act. 2,13,95,574 CESTAT, Comm.(A) 2005-06 Excise Duty, Interest & Penalty. 56,58,800 CESTAT, Comm. (A) 2007-08

23,53,824 CESTAT, Comm. (A) 2001-02

2,10,579 CESTAT, Comm. (A) 1998-99

35,000 CESTAT, Comm. (A) 2009-10

50,03,165 High Court 1995-96

1,20,99,486 Supreme Court 1996-97

(x) As the Company is registered for a period less than 5 years, the requirement of the Order of reporting on accumulated losses and cash losses is not applicable.

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

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

(xiii) The Company is not a Chit Fund or a Nidhi/Mutual Benefit Fund/Society. Therefore, the provisions of Clauses 4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xvi) According to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

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

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

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

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

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

For K. S. AIYAR & CO. Chartered Accountants; FRN:100186W

RAGHUVIR M. AIYAR Partner Membership No.38128

Mumbai DATE: 2nd May, 2011

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