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Auditor Report of Jindal Poly Films Ltd.

Mar 31, 2017

INDEPENDENT AUDITORS’ REPORT

To the Members of Jindal Poly Films Limited Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Jindal Poly Films Limited (‘the Company''), which comprise the Balance Sheet as at 31 March 2017, the Statement of Profit and Loss (including other comprehensive income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as ‘standalone Ind AS financial statements'').

Management’s Responsibility for the Standalone 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 financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act read with relevant rules issued there under.

This responsibility also includes the 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.

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

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 financial position of the Company as at 31 March, 2017, and its 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 (Auditors'' Report) Order, 2016 (‘the Order'') issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure A, a statement on the matters specified in the paragraph 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 Statement of Cash Flows and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

d. in our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act read with relevant rule issued there under;

e. on the basis of the written representations received from the directors as on 31 March 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31 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''; and

g. with respect to the other matters to be included in the Auditors'' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our 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 to Note 37 to the standalone Ind AS financial statements;

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 standalone Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8 November 2016 to 30 December 2016 and these are in accordance with the books of accounts maintained by the Company. Refer to Note 53 to the standalone Ind AS financial statements.

The Annexure referred to in Independent Auditors’ Report to the members of the Company on the standalone Ind AS financial statements for the year ended 31 March 2017, we report that:

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

(b) The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of three years. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii) (a) The management has conducted the physical verification of inventory at reasonable intervals.

(b) The discrepancies noticed on physical verification of the inventory as compared to book records which has been properly dealt with in the books of account were not material.

(iii) The Company has granted loans to three bodies corporate covered in the register maintained under Section 189 of the Companies Act, 2013 (‘the Act'').

(a) In our opinion, the rate of interest and other terms and conditions on which the loans had been granted to the bodies corporate listed in the register maintained under Section 189 of the Act were not, prima facie, prejudicial to the interest of the Company.

(b) In the case of the loans granted to the bodies corporate listed in the register maintained under Section 189 of the Act, the borrowers have been regular in the payment of the principal and interest as stipulated.

(c) There are no overdue amounts in respect of the loan granted to a body corporate listed in the register maintained under Section 189 of the Act.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Act, with respect to grant of loans, investments made, providing guarantee and security.

(v) The Company has not accepted any deposits from the public and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the public are not applicable.

(vi) We have broadly reviewed the cost records maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records, u/s 148(1) of the Companies Act, 2013 and are of opinion that prima -facie the prescribed records and accounts have been maintained by the company. However, we have not made a detailed examination of these records to verify whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the

Company, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of sales tax including value added tax, employee state insurance, provident fund, income tax, duty of customs, service tax, cess, though there has been a delay in a few casesand other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities.

(b) According to the information and explanations given to us, there are no dues of duty of customs which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following dues of income tax, sales tax, duty of excise, service tax and value added tax have not been deposited by the Company on account of disputes:

Nature of the Statute

Nature of the dues

Amount Disputed (Rs/Lacs)

Forum where dispute is pending

1. Income Tax Act

Income Tax demand

14.14

A.O. F.Y 1994-95

Income Tax demand

391.45

CIT(A) GZB F.Y.1998-99

Income Tax demand

68.73

ITAT FY 2004-2005

Income Tax demand

172.55

CIT(A) F.Y 2012-13

Income Tax demand

12.46

A.O. CC-30 F.Y 2005-06

Income Tax demand

18.16

CIT(A) F.Y 2006-07

Income Tax demand

3.49

CIT(A) F.Y 2007-08

Income Tax demand

34.46

CIT(A) F.Y 2006-07

Income Tax demand

872.00

ITAT FY 2011-12

2. Sales Tax Act

Sales Tax Demand

141.45

Sales Tax Tribunal (2004-05 TO 2013-2014)

3. Excise Duty

Demand

1971.07

High court

4. Custom Duty

Demand

301.80

5. Service Tax

Demand

218.75

Tribunal Mumbai

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks. The Company has not taken any loan either from financial institutions or from the government and has not issued any debentures.

(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3(ix) of the Order is not applicable.

(x) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

(xi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197, read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the standalone Ind AS financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act 1934.

Report on the Internal Financial Controls under Clause (i) of sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act’)

We have audited the internal financial controls over financial reporting of Jindal Poly Films Limited (‘the Company'') as of 31 March 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (‘the Guidance Note'') and the Standards on Auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of the management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For Kanodia Sanyal & Associates

Chartered Accountants

FRN:008396N

(Pallav Kumar Vaish)

Place : New Delhi Partner

Date :25th May, 2017 Membership no.: 508751


Mar 31, 2014

We have audited the accompanying financial statements of Jindal Poly Films Limited (the "Company"), which comprise the Balance Sheet as at March 31,2014, 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, which we have signed under reference to this report.

Management''s Responsibility for the Financial Statements

The Company''s 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 notified under the Companies Act, 1956'' of India (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.

Auditors'' 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 auditors'' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider 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 effectiveness of Company''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 accompanying 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 March 31, 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.

Emphasis of Matter

We draw attention to the following Notes i) Note No. 30.10 to the financial statements, relating to accounting policy followed by the Company in respect of mega project subsidy received/receivable under the Package Scheme of Incentive 2001/2007 approved by the Government of Maharashtra. iI.) Note No 30.18 to the Financial Statements, relating to the company had invested Rs. 167 Crores in the zero percent Redeemable Preference Share Capital (Redeemable at a premium of 10% within 15 year from the date of allotment) of Jindal India Powertech Limited (JPIL), a group-SPV Company. iii) Note No. 30.19 relating to the Company has completed the acquisition of overseas business.

Report on Other Legal and Regulatory Requirements

1) As required by ''the Companies (Auditor''s Report) Order, 2003'', as amended by ''the 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 Act (hereinafter referred to as the "Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

(iv) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the Accounting Standard15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act 2013 and ;

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

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT OF JINDAL POLY FILMS LIMITED (Annexure referred to in our report of even date)

1. In respect of fixed assets:

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

(b) The company has a phased programme of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, the management during the year has physically verified all the fixed assets of the Company and no material discrepancies between the book records and the physical verification were noticed on such verification.

(c) Fixed assets disposed off during the year, were not substantial and, therefore, it does not affect the going concern assumption.

2. In respect of its inventories:

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

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

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

3. In respect of the loans:

(a) The company has granted loans to three companies during the year. The maximum amount involved during the year was Rs. 84,06,24,938/- the year-end balance of loan granted to such companies was Rs.38,11,48,599 /-. The company has not taken any loans during the year secured or unsecured from any Company, firm or party covered in register maintained under section 301 of the companies act, 1956.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions are not prima facie prejudicial to the interest of the company

(c) In respect of loans granted by the company the interest payments are regular and the principal amounts are being received /renewed on the due dates. In respect of loans taken by the company, the interest payments are regular and the principal amount is repayable on demand.

(d) There is no overdue amount in respect of the above loans.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business for the purchase of stores, raw material including components, plant and machinery, equipment and other assets, and for the sale of goods. Further, on the basis of our examination of the books and records of the company in accordance with the generally accepted auditing practices, we have neither come across, nor have we been informed the existence of major weakness in the internal control procedures and systems. However, the corrective actions were taken against the minor weaknesses as noticed and informed to them.

5. (a) As per the audit procedures applied by us, and according to the information and explanations given to us by the

management, the transactions made in pursuance of contracts or arrangements that needed to be entered in the register maintained under section 301 of the Companies Act have been so entered.

(b) As per the audit procedures applied by us and as per the information and explanations given to us, with respect to the transactions as entered in the register maintained under section 301, exceeding the value of five lac rupees in respect to any party during the financial year, the prices at which these have been made are reasonable having regard to the prevailing, market prices at that time.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public. Therefore, the provisions of Clause (vi) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

7. In our opinion the company has an internal audit system commensurate with the nature and size of its business.

8. We have broadly reviewed the cost records maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records, u/s 209(1)(d) of the Companies Act, 1956 and are of opinion that prima –facie the prescribed records and accounts have been maintained by the company. However, we have not made a detailed examination of these records to verify whether they are accurate or complete.

9. (a) The company is regular in depositing the undisputed statutory dues including Provident Fund, Investor Education

and Protection Fund, Employees State Insurance, Income-Tax, Sales Tax, Wealth-tax, Custom Duty, Excise Duty, Cess and other statutory dues have been regularly deposited with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2014 for a period of more than six months from the date of becoming payable.

(b) According to the information and explanation given to us, details of dues of income tax, sales tax, excise, customs, wealth tax and service tax which have not been deposited on account of any dispute are given below:

Nature of the Statute Nature of the dues- Amount Disputed demand on Assessment (Rs/Lacs)

1.Income Tax Act Income Tax demand 391.45

Income Tax demand 2.44

Income Tax demand 15.51

Income Tax demand 0.88

Income Tax demand 14.14

Income Tax demand U/s 153A 253.72

Income Tax demand U/s 153A 333.44

Income Tax demand U/s 153A 330.27

2.Sales Tax Act Sales Tax Demand 1929.35

3. Excise Duty Demand 207.08

Demand 110.85

4 Service Tax Demand 240.02

Demand 66.60

Demand 188.58

Nature of the statues Forum where dispute is pending

1. Income Tax Act ITAT F.Y.1998-1999

ITAT F.Y.2000-2001

ITAT F.Y 1997-1998

CIT(A) F.Y 2000-2001

CIT(A) F.Y 2005-2006

CIT(A) F.Y 2009-2010

CIT(A) F.Y 2010-2011

CIT(A) F.Y 2010-2011

2. Sales Tax Act Sales Tax Tribunal (2002-03 TO 2007-2008)

3. Excise Duty High court year 2002-2005

High court year 2002-2005

4 Service Tax Tribunal Mumbai year 2008-2011

Tribunal Delhi year 2002-2008

Commissioner/ JT commissioner year 2006-2011

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

11. According to the information and explanations given to us and as per the books of accounts examined by us, the company has not defaulted in the repayment of dues to the financial institutions or to the banks or to the debenture holders.

12. 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.

13. In our opinion, the company is not a Chit Fund/Nidhi/Mutual Fund/ Society. Therefore, clause 4(xiii) of the Companies (Auditor''s Report) Order 2003 is not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in securities, debentures and other investments timely entries have been made therein. All shares, debentures, and other investments have been held by the Company in its own name.

15. In our opinion and according to the information and explanations given to us, the terms and conditions of the corporate guarantees given by the company for loan taken by other company from banks are not prima facie prejudicial to the interest of the company.

16. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and as per the books and records examined by us, as on the date of balance sheet, the funds raised by the company on short-term basis have not been applied for long-term investments and vice versa.

18. 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.

19. The company does not have any debentures outstanding as on the Balance Sheet date, hence, the clause 4(xix) of the order is not applicable.

20. The company has not raised any money through a public issue during the year.

21. According to the information and explanations given to us, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India, we have not come across any such instance of fraud on or by the company, noticed and reported during the year.

For KANODIA SANYAL & ASSOCIATES CHARTERED ACCOUNTANTS FRN 008396N

Place: New Delhi (R.K. KANODIA) Dated: 30th May, 2014 PARTNER Membership No. 016121


Mar 31, 2013

1) Report on the Financial Statements

We have audited the accompanying financial statements of Jindal Poly Films Limited (the "Company")'' which comprise the Balance Sheet as at March 31''2013'' the Statement of Profit and Loss and Cash Flow Statement for the year then ended'' and a summary of significant accounting policies and other explanatory information'' which we have signed under reference to this report.

2) Management''s Responsibility for the Financial Statements

The Company''s 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'' of India (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.

3) Auditors'' 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.

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

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

6) Opinion

In our opinion'' and to the best of our information and according to the explanations given to us'' the accompanying 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 March 31'' 2013;

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.

7) Emphasis of Matter

We draw attention to Note No 30.12 to the Financial Statements'' relating to change in accounting policy in respect of mega project subsidy received under the Package Scheme of Incentive 2001/2007 approved by the Government of Maharashtra. Our opinion not qualified in respect of matter.

8) Report on Other Legal and Regulatory Requirements

As required by ''the Companies (Auditor''s Report) Order'' 2003'''' as amended by ''the 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 Act (hereinafter referred to as the "Order")'' and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us'' we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

9) As required by Section 227(3) of the Act'' we report that:

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

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

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

(iv) In our opinion'' the Balance Sheet'' Statement of Profit and Loss 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 Act;

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

ANNEXURE TO AUDITORS'' REPORT OF JINDAL POLY FILMS LIMITED (Annexure referred to in our report of even date)

1. In respect of fixed assets:

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

(b) The company has a phased programme of physical verification of its fixed assets which'' in our opinion'' is reasonable having regard to the size of the Company and the nature of its assets. As explained to us'' the management during the year has physically verified all the fixed assets of the Company and no material discrepancies between the book records and the physical verification were noticed on such verification.

(c) Fixed assets disposed off during the year'' were not substantial and'' therefore'' it does not affect the going concern assumption.

2. In respect of its inventories:

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

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

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

3. In respect of the loans:

(a) The company has granted loans to one company during the year. The maximum amount involved during the year was Rs.11''16''17''631/-/- the year-end balance of loan granted to such companies was Rs. 11''16''17''631/-. The company has not taken any loans during the year secured or unsecured from any Company'' firm or party covered in register maintained under section 301 of the companies act'' 1956.

(b) In our opinion and according to the information and explanations given to us'' the rate of interest and other terms and conditions are not prima facie prejudicial to the interest of the company

(c) In respect of loans granted by the company the interest payments are regular and the principal amounts are being received /renewed on the due dates. In respect of loans taken by the company'' the interest payments are regular and the principal amount is repayable on demand.

(d) There is no overdue amount in respect of the above loans.

4. In our opinion and according to the information and explanations given to us'' there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business for the purchase of stores'' raw material including components'' plant and machinery'' equipment and other assets'' and for the sale of goods. Further'' on the basis of our examination of the books and records of the company in accordance with the generally accepted auditing practices'' we have neither come across'' nor have we been informed the existence of major weakness in the internal control procedures and systems. However'' the corrective actions were taken against the minor weaknesses as noticed and informed to them.

5. (a) As per the audit procedures applied by us'' and according to the information and explanations given to us by the management'' the transactions made in pursuance of contracts or arrangements that needed to be entered in the register maintained under section 301 of the Companies Act have been so entered.

(b) As per the audit procedures applied by us and as per the information and explanations given to us'' with respect to the transactions as entered in the register maintained under section 301'' exceeding the value of five lac rupees in respect to any party during the financial year'' the prices at which these have been made are reasonable having regard to the prevailing'' market prices at that time.

6. According to the information and explanations given to us'' the company has not accepted any deposits from the public. Therefore'' the provisions of Clause (vi) of the Companies (Auditors Report) Order'' 2003 are not applicable to the Company.

7. In our opinion the company has an internal audit system commensurate with the nature and size of its business.

8. We have broadly reviewed the cost records maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records'' u/s 209(1)(d) of the Companies Act'' 1956 and are of opinion that prima –facie the prescribed records and accounts have been maintained by the company. However'' we have not made a detailed examination of these records to verify whether they are accurate or complete.

9. (a) The company is regular in depositing the undisputed statutory dues including Provident Fund'' Investor Education and Protection Fund'' Employees State Insurance'' Income-Tax'' Sales Tax'' Wealth-tax'' Custom Duty'' Excise Duty'' Cess and other statutory dues have been regularly deposited with the appropriate authorities during the year. According to the information and explanations given to us'' no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2013 for a period of more than six months from the date of becoming payable.

(b) According to the information and explanation given to us'' details of dues of income tax'' sales tax'' excise'' customs'' wealth tax and service tax which have not been deposited on account of any dispute are given below:

Nature of the Statute Nature of the dues Amount Disputed Forum where dispute (Rs/Lacs) is pending

1.Income Tax Act Income Tax demand 391.45 ITAT F.Y.1998-1999

Income Tax demand 17.08 CIT F.Y.2004-2005

Income Tax demand 2.44 ITAT F.Y.2000-2001

Income Tax demand 15.51 ITAT F.Y 1997-1998

Income Tax demand 0.71 CIT(A) F.Y 2005-2006

Income Tax demand 0.88 CIT(A) F.Y 2000-2001

Income Tax demand 1.0 CIT(A) F.Y 2003-2004

Income Tax demand 68.23 CIT(A) F.Y 2006-2007

Income Tax demand 14.14 CIT(A) F.Y 1995-1996

2. Sales Tax Act Sales Tax Demand 1921.49 Sales Tax Tribunal (2002-03 TO 2007-2008)

3. Excise Duty Demand 2.15 Commissioner appeal year 2010-2013.

Demand 187.56 High court year 2002-2005

Demand 110.85

4 Service Tax Demand 240.02 Tribunal Mumbai year 2008-2011

Demand 66.60 Tribunal Delhi year 2002-2008

Demand 188.58 Commissioner/ JT commissioner year 2006-2011

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

11. According to the information and explanations given to us and as per the books of accounts examined by us'' the company has not defaulted in the repayment of dues to the financial institutions or to the banks or to the debenture holders.

12. 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.

13. In our opinion'' the company is not a Chit Fund/Nidhi/Mutual Fund/ Society. Therefore'' clause 4(xiii) of the Companies (Auditor''s Report) Order 2003 is not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in securities'' debentures and other investments timely entries have been made therein. All shares'' debentures'' and other investments have been held by the Company in its own name.

15. According to the information and explanations given to us'' the Company has not given any guarantees against loans taken by others from banks & financial institutions.

16. Based on information and explanations given to us by the management'' term loans were applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and as per the books and records examined by us'' as on the date of balance sheet'' the funds raised by the company on short-term basis have not been applied for long-term investments and vice versa.

18. 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.

19. The company does not have any debentures outstanding as on the Balance Sheet date'' hence'' the clause 4(xix) of the order is not applicable.

20. The company has not raised any money through a public issue during the year.

21. According to the information and explanations given to us'' and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India'' we have not come across any such instance of fraud on or by the company'' noticed and reported during the year.

For KANODIA SANYAL & ASSOCIATES

CHARTERED ACCOUNTANTS

Firm Registration No.008396N (R.K KANODIA)

PARTNER

Membership No. 016121

Place : New Delhi

Dated : 29th May'' 2013


Mar 31, 2012

We have audited the attached Balance Sheet of M/S JINDAL POLY FILMS LIMITED as at 31st March, 2012 and also the annexed Statement of Profit and Loss Account and the Cash Flow Statement for the year ended on that date (together referred to as 'financial statements'). 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 the 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 the 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, issued by the Central Government of India in terms of Section 227(4A), of the Companies Act 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said order.

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

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

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

c) The Balance Sheet, Profit & 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 have been prepared in compliance with the Accounting Standards referred to in Sub Section (3C) of Section 211 of the Companies Act, 1956.

e) On the basis of the written representations received from the directors and taken on record by the Board of Directors, we report that none of the said directors are disqualified as on 31st March, 2012 from being appointed as directors in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with significant accounting policies and other notes (note no. 1 to 30) give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

ii. In the case of the Profit & Loss Account, of the Profit of the Company for the year ended on that date.

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

ANNEXURE TO AUDITORS' REPORT OF JINDAL POLY FILMS LIMITED (Annexure referred to in our report of even date)

1. In respect of fixed assets:

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

(b) The company has a phased programme of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, the management during the year has physically verified all the fixed assets of the Company and no material discrepancies between the book records and the physical verification were noticed on such verification.

(c) Fixed assets disposed off during the year, were not substantial and, therefore, it does not affect the going concern assumption.

2. In respect of its inventories:

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

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

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

3. In respect of the loans:

(a) The company has granted loans to one company during the year. The maximum amount involved during the year was Rs.77, 655,068/- the year-end balance of loan granted to such companies was Rs. 77,655,068/-. The company has not taken any loans during the year secured or unsecured to any Company, firm or party covered in register maintained under section 301 of the Companies Act, 1956.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions are not prima facie prejudicial to the interest of the company

(c) In respect of loans granted by the company the interest payments are regular and the principal amounts are being received /renewed on the due dates. In respect of loans taken by the company, the interest payments are regular and the principal amount is repayable on demand.

(d) There is no overdue amount in respect of the above loans.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control

procedure commensurate with the size of the Company and the nature of its business for the purchase of stores, raw material including components, plant and machinery, equipment and other assets and for the sale of goods. Further, on the basis of our examination of the books and records of the company in accordance with the generally accepted auditing practices, we have neither come across, nor have we been informed the existence of major weakness in the internal control procedures and systems. However, the corrective actions were taken against the minor weaknesses as noticed and informed to them.

5. (a) As per the audit procedures applied by us, and according to the information and explanations given to us by the management, the transactions made in pursuance of contracts or arrangements that needed to be entered in the register maintained under section 301 of the Companies Act, have been so entered.

(b) As per the audit procedures applied by us and as per the information and explanations given to us, with respect to the transactions as entered in the register maintained under section 301, exceeding the value of five lac rupees in respect to any party during the financial year, the prices at which these have been made are reasonable having regard to the prevailing market prices at that time.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public. Therefore, the provisions of Clause (vi) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

7. In our opinion the company has an internal audit system commensurate with the nature and size of its business.

8. We have broadly reviewed the cost records maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records u/s 209(1)(d) of the Companies Act, 1956 and are of opinion that prima –facie the prescribed records and accounts have been maintained by the company. However, we have not made a detailed examination of these records to verify whether they are accurate or complete.

9. (a) The company is regular in depositing the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales Tax, Wealth-tax, Custom Duty, Excise Duty, Cess and other statutory dues have been regularly deposited with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2012 for a period of more than six months from the date of becoming payable.

(b) According to the information and explanation given to us, details of dues of income tax, sales tax, excise, customs, wealth tax and service tax which have not been deposited on account of any dispute are given below:

Nature of the Statute Nature of the dues Amount Disputed Forum where dispute (Rs/Lacs) is pending

1. Income Tax Act Income Tax demand 391.45 ITAT F.Y.1998-99

Income Tax demand 17.08 CIT F.Y.2004-2005

Income Tax demand 2.44 ITAT F.Y.2000-2001

Income Tax demand 15.51 ITAT F.Y 1997-98

Income Tax demand 0.70 CIT(A) F.Y 2005-06

Income Tax demand 0.87 CIT(A) F.Y 2000-01

Income Tax demand 1.0 CIT(A) F.Y 2003-04

Income Tax demand 68.23 CIT(A) F.Y 2006-2007

Income Tax demand 82.46 CIT(A) F.Y 2007-08

Income Tax demand 1.52 CIT(A) F.Y 2008-09

2. Sales Tax Act Sales Tax Demand 1811.59 Sales Tax Tribunal (2002-03 TO 2007-2008)

3. Custom Law Act Demand 613.66 Asst. Commissioner

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

11. According to the information and explanations given to us and as per the books of accounts examined by us, the company has not defaulted in the repayment of dues to the financial institutions or to the banks or to the debenture holders.

12. 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.

13. In our opinion, the company is not a Chit Fund/Nidhi/Mutual Fund/ Society. Therefore, clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 is not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in securities, debentures and other investments timely entries have been made therein. All shares, debentures, and other investments have been held by the Company in its own name.

15. According to the information and explanations given to us, the Company has not given any guarantees against loans taken by others from banks & financial institutions.

16. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and as per the books and records examined by us, as on the date of balance sheet, the funds raised by the company on short-term basis have not been applied for long-term investments and vice versa.

18. 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.

19. The company does not have any debentures outstanding as on the Balance Sheet date, hence, the clause 4(xix) of the order is not applicable.

20. The company has not raised any money through a public issue during the year.

21. According to the information and explanations given to us, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India, we have not come across any such instance of fraud on or by the company, noticed and reported during the year.

For KANODIA SANYAL & ASSOCIATES

CHARTERED ACCOUNTANTS

Firm Registration No.008396N

Place: New Delhi (R.K KANODIA)

Dated: 01st September, 2012 PARTNER

Membership No. 016121


Mar 31, 2011

We have audited the attached Balance Sheet of M/S JINDAL POLY FILMS LIMITED as at 31st March, 2011 and also the annexed Profit and Loss Account and the Cash Flow Statement for the year ended on that date (together referred to as 'financial statements'). 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 the 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 the 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, issued by the Central Government of India in terms of Section 227(4A), of the Companies Act 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said order.

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

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

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

c) The Balance Sheet, Profit & 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 have been prepared in compliance with the Accounting standards referred to in Sub Section (3C) of Section 211 of the Companies Act, 1956.

e) On the basis of the written representations received from the directors and taken on record by the Board of Directors, we report that none of the said directors are disqualified as on 31st March, 2011 from being appointed as directors in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with significant accounting policies and notes thereon in Schedule '17' give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i. In the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2011 and,

ii. In the case of the Profit & Loss Account, of the Profit of the Company for the year ended on that date.

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

ANNEXURE TO AUDITORS' REPORT OF JINDAL POLY FILMS LIMITED (Annexure referred to in our report of even date)

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

(b) The company has a phased programme of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, the management during the year has physically verified all the fixed assets of the Company and no material discrepancies between the book records and the physical verification were noticed on such verification.

(c) Fixed assets disposed off during the year, were not substantial and, therefore, it does not affect the going concern assumption.

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

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

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

3. In respect of loans, secured or unsecured, granted or taken by the company to / from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

(a) The company has granted loans to one company during the year. The maximum amount involved during the year was Rs. 42, 829,704/- the year-end balance of loan granted to such companies was Rs. 42,829,704/-. The company has not taken any loans during the year secured or unsecured to any Company, firm or party covered in register maintained under section 301 of the companies act, 1956.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions are not prima facie prejudicial to the interest of the company.

(c) In respect of loans granted by the company the interest payments are regular and the principal amounts are being received /renewed on the due dates. In respect of loans taken by the company, the interest payments are regular and the principal amount is repayable on demand.

(d) There is no overdue amount in respect of the above loans.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business for the purchase of stores, raw material including components, plant and machinery, equipment and other assets, and for the sale of goods. Further, on the basis of our examination of the books and records of the company in accordance with the generally accepted auditing practices, we have neither come across, nor have we been informed the existence of major weakness in the internal control procedures and systems. However, the corrective actions were taken against the minor weaknesses as noticed and informed to them.

5. (a) As per the audit procedures applied by us, and according to the information and explanations given to us by the management, the transactions made in pursuance of contracts or arrangements that needed to be entered in the register maintained under section 301 of the Companies Act have been so entered.

(b) As per the audit procedures applied by us and as per the information and explanations given to us, with respect to the transactions as entered in the register maintained under section 301, exceeding the value of five lac rupees in respect to any party during the financial year, the prices at which these have been made are reasonable having regard to the prevailing, market prices at that time.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public. Therefore, the provisions of Clause (vi) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

7. In our opinion the company has an internal audit system commensurate with the nature and size of its business.

8. We have broadly reviewed the cost records maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records, u/s 209(1)(d) of the Companies Act, 1956 and are of opinion that prima –facie the prescribed records and accounts have been maintained by the company. However, we have not made a detailed examination of these records to verify whether they are accurate or complete.

9. (a) The company is regular in depositing the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales Tax, Wealth-Tax, Custom Duty, Excise Duty, Cess and other statutory dues have been regularly deposited with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2011 for a period of more than six months from the date of becoming payable.

(b) According to the information and explanations given to us, details of dues of income tax, sales tax, excise, customs, wealth tax and service tax which have not been deposited on account of any dispute are given below:

Nature of the Statute Nature of the dues Amount Disputed Forum where dispute is pending (Rs/Lacs)

1.Income Tax Act Income Tax demand 391.45 ITAT F.Y.1998-99

Income Tax demand 17.08 ITAT F.Y.2004-05

Income Tax demand 2.44 ITAT F.Y.2000-2001

Income Tax demand 15.51 ITAT F.Y 1997-98

Income Tax demand 0.70 CIT(A) F.Y 2005-06

Income Tax demand 0.87 CIT(A) F.Y 2000-01

Income Tax demand 1.00 CIT(A) F.Y 2003-04

Income Tax demand 68.23 CIT(A) F.Y 2006-07

Income Tax demand 82.46 CIT(A) F.Y 2007-08

Income Tax demand 1.52 CIT(A) F.Y 2008-09

2.Sales Tax Act Sales Tax Demand 224.93 Sales Tax Tribunal (2002-03 TO 2004-05)

3.Custom Law Act Demand 613.66 Asst. Commissioner

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

11. According to the information and explanations given to us and as per the books of accounts examined by us, the company has not defaulted in the repayment of dues to the financial institutions or to the banks or to the debenture holders.

12. 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.

13. In our opinion, the company is not a Chit Fund/Nidhi/Mutual Fund/ Society. Therefore, clause 4(xiii) of the Companies (Auditor's Report) Order 2003 is not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in securities, debentures and other investments timely entries have been made therein. All shares, debentures, and other investments have been held by the Company in its own name.

15. According to the information and explanations given to us, the Company has not given any guarantees against loans taken by others from banks & financial institutions.

16. Based on information and explanations given to us by the Management, term-loans were applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and as per the books and records examined by us, as on the date of Balance Sheet, the funds raised by the company on short-term basis have not been applied for long-term investments and vice versa.

18. 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.

19. The company does not have any debentures outstanding as on the Balance Sheet date, hence, the clause 4(xix) of the order is not applicable.

20. The Company has not raised any money through a public issue during the year.

21. According to the information and explanations given to us, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India, we have not come across any such instance of fraud on or by the company, noticed and reported during the year.

For KANODIA SANYAL & ASSOCIATES

CHARTERED ACCOUNTANTS

Firm Registration No.008396N

(R.K. KANODIA)

Place: New Delhi PARTNER

Dated: 08-08-2011 Membership No. 016121


Mar 31, 2010

We have audited the attached Balance Sheet of M/S JINDAL POLY FILMS LIMITED as at 31st March, 2010 and also the annexed Profit and Loss Account and the Cash Flow Statement for the year ended on that date (together referred to as financial statements). 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.

We conducted our audit in accordance with the 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 the 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 (Auditors Report) Order, 2003, issued by the Central Government of India in terms of Section 227(4A), of the Companies Act 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said order.

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

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

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

c) The Balance Sheet, Profit & 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 have been prepared in compliance with the Accounting standards referred to in Sub Section (3C) of Section 211 of the Companies Act, 1956.

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with significant accounting policies and notes thereon in Schedule ‘18 give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i. In the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2010 and

ii. In the case of the Profit & Loss Account, of the Profit of the Company for the year ended on that date.

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





ANNEXURE TO AUDITORS REPORT OF JINDAL POLY FILMS LIMITED (Annexure referred to in our report of even date)

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

(b) The company has a phased programme of physical verification of its fixed assets which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As explained to us, the management during the year has physically verified all the fixed assets of the Company and no material discrepancies between the book records and the physical verification were noticed on such verification.

(c) Fixed assets disposed off during the year, were not substantial and, therefore, it does not affect the going concern assumption.

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

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

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

3. In respect of loans, secured or unsecured, granted or taken by the company to / from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

(a) The company has granted loans to one company during the year. The maximum amount involved during the year was Rs.19, 406,168/- the year end balance of loan granted to such companies was Rs. 19, 406,168/-. The company has not taken any loans during the year secured or unsecured to any Company, firm or party covered in register maintained under section 301 of the companies act, 1956.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions are not prima facie prejudicial to the interest of the company

(c) In respect of loans granted by the company the interest payments are regular and the principal amounts are being received /renewed on the due dates. In respect of loans taken by the company, the interest payments are regular and the principal amount is repayable on demand.

(d) There is no overdue amount in respect of the above loans.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business for the purchase of stores, raw material including components, plant and machinery, equipment and other assets, and for the sale of goods. Further, on the basis of our examination of the books and records of the company in accordance with the generally accepted auditing practices, we have neither come across, nor have we been informed the existence of major weakness in the internal control procedures and systems. However, the corrective actions were taken against the minor weaknesses as noticed and informed to them.

5. (a) As per the audit procedures applied by us, and according to the information and explanations given to us by the management, the transactions made in pursuance of contracts or arrangements that needed to be entered in the register maintained under section 301 of the Companies Act have been so entered.

(b) As per the audit procedures applied by us and as per the information and explanations given to us, with respect to the transactions as entered in the register maintained under section 301, exceeding the value of five lac rupees in respect to any party during the financial year, the prices at which these have been made are reasonable having regard to the prevailing, market prices at that time.

6. According to the information and explanations given to us, the company has not accepted any deposits from the public. Therefore, the provisions of Clause (vi) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

7. In our opinion the company has an internal audit system commensurate with the nature and size of its business.

8. We have broadly reviewed the cost records maintained by the company pursuant to the order made by the Central Government for the maintenance of cost records, u/s 209(1)(d) of the Companies Act, 1956 and are of opinion that prima –facie the prescribed records and accounts have been maintained by the company. However, we have not made a detailed examination of these records to verify whether they are accurate or complete.

9. (a) The company is regular in depositing the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales Tax, Wealth-tax, Custom Duty, Excise Duty, Cess and other statutory dues have been regularly deposited with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2010 for a period of more than six months from the date of becoming payable.

(b) According to the information and explanation given to us, details of dues of income tax, sales tax, excise, customs, wealth tax and service tax which have not been deposited on account of any dispute are given below:

Nature of the Statute Nature of the dues Amount Disputed

(Rs/Lacs)

1. Income Tax Act Income Tax demand 391.45

Income Tax demand 351.62

Income Tax demand 14.14

Income Tax demand 2.44

Income Tax demand 15.51

Income Tax demand 0.70

Income Tax demand 0.87

2. Excise Act Excise Demand 270.32

3. Sales Tax Act Sales Tax Demand 224.93

4. Custom Law Act Demand 81.60

Nature of the Statute Forum where dispute is pending

1. Income Tax Act CIT(A) F.Y.1998-99

CIT(A) F.Y.2004-05

ITAT F.Y.1994-95 ITAT F.Y.2000-2001 CIT(A)

F.Y 1997-98 CIT(A)

F.Y 2005-06 CIT(A)

F.Y 2000-01

2. Excise Act CESTAT

3. Sales Tax Act Sales Tax Tribunal

4. Custom Law Act Asst. Commissioner

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

11. According to the information and explanations given to us and as per the books of accounts examined by us, the company has not defaulted in the repayment of dues to the financial institutions or to the banks or to the debenture holders.

12. 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.

13. In our opinion, the company is not a Chit Fund/Nidhi/Mutual Fund/ Society. Therefore, clause 4(xiii) of the Companies (Auditors Report) Order 2003 is not applicable to the company.

14. The Company has maintained proper records of transactions and contracts in respect of trading in securities, debentures and other investments timely entries have been made therein. All shares, debentures, and other investments have been held by the Company in its own name.

15. According to the information and explanations given to us, the Company has not given any guarantees against loans taken by others from banks & financial institutions.

16. In our opinion and according to the information and explanations given to us, the company has not raised any term loans during the year. Hence the paragraph 4(xvi) of the order is not applicable.

17. According to the information and explanations given to us and as per the books and records examined by us, as on the date of balance sheet, the funds raised by the company on short-term basis have not been applied for long-term investments and vice versa.

18. 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.

19. The company does not have any debentures outstanding as on the Balance Sheet date, hence, the clause 4(xix) of the order is not applicable.

20. We have verified that the end use of money raised by public issues is as disclosed in the notes to the financial statements.

21. According to the information and explanations given to us, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India, we have not come across any such instance of fraud on or by the company, noticed and reported during the year.

For KANODIA SANYAL & ASSOCIATES

CHARTERED ACCOUNTANTS

Firm Registration No.008396N

(R.K KANODIA)

Place: New Delhi PARTNER

Dated: 03-09-2010 Membership No. 016121

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