Auditor Report of Gagan Gases Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of GAGAN GASES LIMITED ("the company"), which comprise the Balance Sheet as at 31 March 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year ended, and a summary of 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 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 the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and 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 true and fair view 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 Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

b) In the case of the Statement of Profit and Loss, of the 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, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, a statement on the matters specified in the paragraph 3 and 4 of the Order is given in Annexure.

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 appears from our examination of those books (and proper returns adequate for the purposes of our audit have been received from the branches not visited by us)

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

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) There is nothing to disclose which is having adverse effect on the functioning of the company.

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

Forming an Opinion and Reporting on Financial Statements

The Annexure referred to in our report to the members of Gagan Gases Limited for the year ended on 31.03.2015. We report that:

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

These fixed assets lying at office and factory have been physically verified by the management at reasonable intervals;

No any material discrepancies were noticed on such verification (ii) Physical verification of inventory has been conducted at reasonable intervals by the management;

The procedures of physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

The company is maintaining proper records of inventory ;

No material discrepancies were noticed on physical verification done by the management ;

(iii) The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act ;

(iv) 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 and services ;

(v) The company has not accepted deposits other than its directors and has followed 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 and the rules framed there under;

(vi) On the basis of information given by the management , maintenance of cost records has not been specified by the Central Government under sub-section (1) of section 148 of the Companies Act for the company;

(vii) The company is regular in depositing undisputed statutory dues with the appropriate authorities;

(viii) The accumulated losses of the company at the end of the financial year are not less than fifty per cent of its net worth . It has not incurred cash losses in current financial year but has incurred cash losses in immediately preceding financial year;

(ix) The company do not have loan from any financial institution or bank or debenture holders hence clause not applicable for comment;

(x) We are informed that the company has not given any guarantee for loans taken by others from bank or financial institutions;

(xi) The company has not obtained term loans hence clause not applicable for comment.

(xii) The company has not noticed or reported any fraud on or by the company during the year under audit .

Forming an Opinion and Reporting on Financial Statements

FOR DILIP K. NEEMA & ASSOCIATES

Chartered Accountants

Place : Indore

Date : 30/05/2015 (CA. Dilip Neema)

M. No.: 074067

FRN: 005279C

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Mar 31, 2014

We have audited the accompanying financial statements of GAGAN GASES LIMITED (''the Company'') which comprise the balance sheet as at 31 March 2014, the statement of profit and loss and the cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The 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 Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

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

(i) in the case of the balance sheet, of the state of affairs of the Company as at 31 March 2014;

(ii) in the case of the statement of profit and loss, of the profit for the year ended on that date; and

(iii) in the case of the cash flow statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

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

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

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

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

c. the balance sheet, statement of profit and loss and cash flow statement dealt with by this Report are in agreement with the books of account;

d. in our opinion, the balance sheet, statement of profit and loss and cash flow statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013; and

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

Annexure to the Auditors'' Report

The Annexure referred to in our report to the members of Gagan Gases Limited (''the Company'') for the year ended 31 March 2014. We report that :

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

ii Fixed assets except LPG cylinders have been physically verified by the management at reasonable intervals during the year. LPG cylinders being in the physical possession of consumers and dealers which are verified in routine as and when these pass through the company for refilling. We have not noted any discrepancies on such verification.

iii No substantial part of fixed assets have been disposed off during the year.

2. i As per records produced before us and in accordance with Management representation Physical verification of inventory has been conducted at reasonable intervals by the management.

ii The procedures of physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

iii The company is maintaining proper records of inventory. No Material discrepancies noticed on physical verification .

3. The company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act. The company has taken loans, secured or unsecured form companies, firms or other parties covered in the register maintained under section 301 of the Act. Terms and conditions were prima facie not prejudicial to the interest of the company.

4 There is adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory fixed assets and for the sale of goods and services. There is no continuing failure to correct major weakness in internal controls.

5 We are informed that transaction during the year that need to be entered into a register in pursuance of section 301 of the Act have been so entered. The transaction have been made at prices which are prima facie reasonable having regard to the prevailing market prices at relevant time.

6 The company has not accepted deposits from the public where the directives issued by RBI and the provisions of sec. 58A, 58AA or any other relevant provision of the Act and rule framed there under where applicable.

7 The company have followed in-house internal audit system commensurate with its size and nature of its business as applicable to it.

8 On the basis of information given to us by management of the company , maintenance of cost records has not prescribed by the central government under clause (d) of sub section (I) of section 209 of the Act.

9 According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income tax, Sales tax, Wealth tax, Service tax, and other material statutory dues (whichever is applicable) have been regularly deposited during the year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Employees'' State Insurance, Customs duty and Excise duty . According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Income tax, Sales tax, Wealth tax, Service tax and other material statutory dues (whichever is applicable) were in arrears as at 31 March 2014 for a period of more than six months from the date they became payable.

10 The company has accumulated losses as at march 31, 2014 exceeds 50% of net worth of the company. The company has incurred cash losses during the current year and in immediately preceding financial year .

11 As per the books and records as produced before us and in accordance with Management representation the Company has not defaulted in repayment of any dues to the bank .

12 The company is not involved in business of granting loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13 In our opinion and according to the information and explanations given to us, the Company is not a chit fund / nidhi / mutual benefit fund / society.

14 The company is not dealing or trading in shares, securities, debentures and other investment.

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

16 On the basis of books of accounts and declaration given by the management, the company has not taken terms loans during the year under audit hence clause not applicable for comment.

17 On the basis of books of accounts and declaration given by the management, the company has not utilized the funds raised on short terms basis for long term investment

18 As per the books and records as produced before us and in accordance with Management representation the company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

19 As per the books and records as produced before us and in accordance with Management representation no debentures were issued during the year by the company.

20 The company has not raised capital through public issue during the year.

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

INDORE, 30.05.2014 For Dilip K. Neema & Associates Chartered accountants

(CA. Dilip Neema) FRN 05279C Membership No.074067

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Mar 31, 2013

Report on the Financial Statement

We have audited the accompanying financial statements of GAGAN GASES LLIMITED ("the company"), which comprise the Balance Sheet as at March 3l,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 Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the accounting standards referred to in sub-section (3c) of section 211 of the companies act 1956 ("the act").This responsibility includes the design, implementation and maintenance of internal controls related 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 Accountant of India .Those Standards require that we comply with ethical requirement and plan and perform the audit to obtain reasonable assurance about whether the financial statement 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 the 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 the 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 loss for the year ended on that date; and

(c) In the case of the cash flow statement, of the cash that flows for the year ended on that date.

Report on other legal and regulatory requirements

1) As required by |he 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 explanation which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. In our opinion proper books of accounts as required by law have been kept by the company so far as appears from our examinations of those;

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 in 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, 1965 ''

e. On the basis of written representation received from the directors as on March31st,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.

Statement as required by Companies (Auditors'' Report ) order , 2003 as amended by the Companies

(Auditor''s Report) (Amendment) order, 2004, (together the "Order") issued by the central government of India

in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956, of India (the ''Act''):

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

ii Fixed assets except LPG cylinders have been physically verified by the management at reasonable intervals during the year. LPG cylinders being in the physical possession of consumers and dealers which are verified in routine as and when these pass through the company for refilling. We have not noted any discrepancies on such verification.

iii No substantial part of fixed assets have been disposed off during the year,

2. i As per records produced before us and in accordance with Management representation Physical verification of inventory has been conducted at reasonable intervals by the management.

ii The procedures of physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

iii The company is maintaining proper records of inventory. No Material discrepancies noticed on physical verification.

3. The company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act. The company has taken loans, secured or unsecured form companies, firms or other parties covered in the register maintained under section 301 of the Act. Terms and conditions were prima facie not prejudicial to the interest of the company.

4 There is adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory fixed assets and for the sale of goods and services. There is no continuing failure to correct major weakness in internal controls.

5 We are informed that transaction during the year that need to be entered into a register in pursuance of section 301 of the Act have been so entered. The transaction have been made at prices which are prima facie reasonable having regard to the prevailing market prices at relevant time.

6 The company has not accepted deposits from the public where the directives issued by RBI and the provisions of sec. 58A, 58AA or any other relevant provision of the Act and rule framed there under where applicable.

7 The company have followed in-house internal audit system commensurate with its size and nature of its business as applicable to it.

8 On the basis of information given to us by management of the company, maintenance of cost records has not prescribed by the central government under clause (d) of sub section (I) of section 209 of the Act.

9 As per the books and records as produced before us and in accordance with Management representation , the company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty for the year 2012-2013 (whichever is applicable ) which have not been deposited on account of dispute.

10 The company has accumulated losses as at march 31,2013 exceeds 50% of net worth of the company. The company has incurred cash losses during the current year . There was no cash loss immediately preceding financial year.

11 As per the books and records as produced before us and in accordance with Management representation the Company has not defaulted in repayment of any dues to bank .

12 The company is not involved in business of granting loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13 The company is not involved in business of chit fund. .

14 The company is not dealing or trading in shares, securities, debentures and other investment.

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

16 On the basis of books of accounts and declaration given by the management, the company has not taken terms loans during the year under audit hence clause not applicable for comment.

17 On the basis of books of accounts and declaration given by the management, the company has not utilized the funds raised on short terms basis for long term investment

18 As per the books and records as produced before us and in accordance with Management representation the company traces not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

19 As per the books and records as produced before us and in accordance with Management representation no debentures were issued during the year by the company.

20 The company has not raised capital through public issue during the year. .

21 To the best of our knowledge and belief and according to the information and explanation given to us, no fraud on or by he company was noticed or reported during the year.

INDORE, 30.05.2013 For Dilip K. Neema & Associates

Chartered accountants



(CA. Dilip Neema)

FRN 05279C

Membership No.074067

INDORE, May 25, 2013

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Mar 31, 2012

1) We have audited the attached Balance Sheet of GAGAN GASES Limited ( the Company ) as at March 31 ,2012, and the Profit and Loss Account for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date, which we have signed under reference to this report. 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 have conducted our audit in accordance with auditing standards generally accepted in India. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis , evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3) As required by the Companies (Auditors Report) order, 2003 , as amended by the companies (Auditors Report) (Amendment) order 2004 (together the "order") issued by the Government of India Ministry of Finance 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 paragraph 4 and 5 of the said order.

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

a. We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the 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 examination of those books;

c. The Balance Sheet, Profit and Loss account and cash flow statement dealt with by this report are in agreement with the books of account;

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

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

f. In our opinion and to the best of our information and according to the explanations given to us, the Balance Sheet, Profit & Loss Account and the Cash Flow Statement together with the notes thereon and annexed thereto give in the prescribed manner, the information required by the Act and also 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 on March 31, 2012 and

(ii) in the case of the Profit and Loss account, of the loss of the company for the year ended on that date; and

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

ANNEXURE TO AUDITOR'S REPORT

Statement as required by Companies (Auditors' Report ) order , 2003 as amended by the Companies (Auditor's Report) (Amendment) order, 2004, (together the "Order") issued by the central government of India in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956, of India (the 'Act') :

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

ii. Fixed assets except LPG cylinders have been physically verified by the management at reasonable intervals during the year. LPG cylinders being in the physical possession of consumers and dealers which are verified in routine as and when these pass through the company for refilling. We have not noted any discrepancies on such verification.

iii. No substantial part of fixed assets have been disposed off during the year.

2. i. As per records produced before us and in accordance with Management representation Physical verification of inventory has been conducted at reasonable intervals by the management.

ii. The procedures of physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

iii. The company is maintaining proper records of inventory. No Material discrepancies noticed on physical verification .

3. The company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act. The company has taken loans, secured or unsecured form companies, firms or other parties covered in the register maintained under section 301 of the Act. Terms and conditions were prima facie not prejudicial to the interest of the company.

4. There is adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory fixed assets and for the sale of goods and services. There is no continuing failure to correct major weakness in internal controls.

5. We are informed that transaction during the year that need to be entered into a register in pursuance of section 301 of the Act have been so entered. The transaction have been made at prices which are prima facie reasonable having regard to the prevailing market prices at relevant time.

6. The company has not accepted deposits from the public where the directives issued by RBI and the provisions of sec. 58A, 58AA or any other relevant provision of the Act and rule framed there under where applicable.

7. The company have followed in-house internal audit system commensurate with its size and nature of its business as applicable to it.

8. On the basis of information given to us by management of the company, maintenance of cost records has not prescribed by the central. government under clause (d) of sub section (I) of section 209 of the Act.

9. As per the books and records as produced before us and in accordance with Management representation , the company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee State Insurance, Income Tax, Sales Tax. Wealth Tax, Service Tax, Custom Duty, Excise Duty for the year 2011-2012 (whichever is applicable ) which have not been deposited on account of dispute.

10. The company has accumulated losses as at march 31, 2012 exceeds 50% of net worth of the company but the company has not incurred any cash losses during the current year as well as immediately preceding financial year.

11. As per the books and records as produced before us and in accordance with Management representation the Company has not defaulted in repayment of any dues to bank .

12. The company is not involved in business of granting loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The company is not involved in business of chit fund.

14 .The company is not dealing or trading in shares, securities, debentures and other investment.

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

16. On the basis of books of accounts and declaration given by the management, the company has not taken terms loans during the year under audit hence clause not applicable for comment.

17. On the basis of books of accounts and declaration given by the management, the company has not utilized the funds raised on short terms basis for long term investment

18. As per the books and records as produced before us and in accordance with Management representation the company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

19. As per the books and records as produced before us and in accordance with Management representation no debentures were issued during the year by the company.

20. The company has not raised capital through public issue during the year.

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



For M/s Dilip K. Neema & Associates Chartered Accountants

(Dilip K. Neema) Proprietor M.No. 74067 FRN:005279C

Place : INDORE Date : 26.05.2012

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Mar 31, 2010

1) We have audited the attached Balance Sheet of GAGAN GASES Limited (the Company) as at March31,2010, and the Profit and Loss Account for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date, which we have signed under reference to this report. 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 have conducted our audit in accordance with auditing standards generally accepted in India. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis , evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3) As required by the Companies (Auditors Report) order, 2003, as amended by the companies (Auditors Report) (Amendment) order 2004 (together the "order") issued by the Government of India Ministry of Finance 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 paragraph 4 and 5 of the said order.

4) Further to our comments in the annexure referred to in paragraph 3 above, we report that:

a. We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the 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 exam ination of those books;

c. The Balance Sheet, Profit and Loss account and cash flow statement dealt with by this report are in agreement with the books of account;

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

e. On the basis of the written representations received from the Directors, as on 31st March 2010 and taken on record by the Board of Directors of the Company, none of the Directors is disqualified as on March 31, 2010 from being appointed as Director is terms of section274 (1 )(g) of the Act;

f. In our opinion and to the best of our information and according to the explanations given to us, the Balance Sheet, Profit & Loss Account and the Cash Flow Statement together with the notes thereon and annexed thereto give in the prescribed manner, the information required by the Act and also give a true and fair view in conformity with the accounting principles generally accepted in India subject to note no. 10(b) of notes on accounts.;

(i) in the case of the Balance Sheet, of the state of affairs of the company as on March31,2010and

(ii) in the case of the Profit and Loss account, of the LOSS of the company for the year ended on that date; and

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

ANNEXURE TO AUDITORS REPORT

Statement as required by Companies (Auditors Report ) order , 2003 as amended by the Companies (Auditors Report ) (Amendment) order , 2004, (together the "Order") issued by the central government of India in terms of Sub Section (4A) of Section 227 of the Companies Act, 1956, of India (the Act):

1. I. The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;

Ii Fixed assets except LPG cylinders have been physically verified by the management at reasonable intervals during the year. LPG cylinders being in the physical possession of consumers and dealers which are verified in routine as and when these pass through the company for refilling. We have not noted any discrepancies on such verification.

iii No substantial part of fixed assets have been disposed off during the year.

2. i As per records produced before us and in accordance with Management representation Physical verification of inventory has been conducted at reasonable intervals by the management.

ii The procedures of physical verification of inventory followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

iii The company is maintaining proper records of inventory. No Material discrepancies noticed on physical verification.

3. The company has not granted loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act. The company has taken loans, secured or unsecured form companies, firms or other parties covered in the register maintained under sectioa 301 of the Act. Terms and conditions were prima facie not prejudicial to the interest of the company.

4 There is adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of inventory fixed assets and for the sale of goods and services. There is no continuing failure to correct major weakness in internal controls.

5 We are informed that transaction during the year that need to be entered into a register in pursuance of section 301 of the Act have been so entered. The transaction have been made at prices which are prima facie reasonable having regard to the prevailing market prices at relevant time.

6 The company has not accepted deposits from the public where the directives issued by RBI and the provisions of sec. 58A, 58AA or any other relevant provision of the Act and rule framed there under where applicable.

7 The company have followed in-house internal audit system commensurate with its size and nature of its business as applicable to it.

8 On the basis of information given to us by management of the company , maintenance of cost records has not prescribed by the central government under clause (d) of sub section (I) of section 209 of the Act.

9 As per the books and records as produced before us and in accordance with Management representation , the company is regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty for the year 2009-2010 (whichever is applicable) which have not been deposited on account of dispute. However Rs. 52214/- and Rs. 107615/- related to undisputed liability of Entry Tax , Commercial Tax and CSTfor FY 2000-2001 and 2001 -2002 respectively are in arrear as at 31.03.2010 for period more than six months.

10 The company has accumulatedlossesasatmarch31,2010exceeds50%ofnet worth of the company but the company has not incurred any cash losses during the current year as well as immediately preceding financial year.

11 As per the books and records as produced before us and in accordance with Management representation the Company has not defaulted in repayment of any dues to bank subject to note no. 10(b) of notes on accounts.

12 The company is not involved in business of granting loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13 The company is not involved in business of chit fund.

14 The company is not dealing or trading in shares, securities, debentures and other investment.

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

16 On the basis of books of accounts and declaration given by the management, the company has taken terms loans during the year under audit hence clause not applicable for comment.

17 On the basis of books of accounts and declaration given by the management, the company has not utilized the funds raised on short terms basis for long term investment

18 As per the books and records as produced before us and in accordance with Management representation the company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under section 301 of the Act.

19 As per the books and records as produced before us and in accordance with Management representation no debentures were issued during the year by the company.

20 The company has not raised capital through public issue during the year.

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

For M/s Dilip K. Neema & Associates

Chartered Accountants

(Dilip K. Neema)

Proprietor

M.No. 74067

Place : INDORE

Date : 30.06.2010