Auditor Report of Kriti Nutrients Ltd.

Mar 31, 2018

INDEPENDENT AUDITOR''S REPORT

To,

The Shareholders of Kriti Nutrients Limited,

34, Siyaganj,

Indore (M.P.)

Report on the Financial Statements

We have audited the accompanying Financial Statements of KRITI NUTRIENTS LIMITED, ("the Company"), which comprise the Balance Sheet as at 31st March 2018, the Statement of Profit & Loss (including other comprehensive income), and the Cash Flow Statement and the Statement of Changes in Equity for the year then 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 stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including Other Comprehensive Income, cash flows and Statement of Changes in Equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards prescribed under Section 133 of the Act, read with relevant rules issued there under.

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

Auditor''s Responsibility

Our responsibility is to express an opinion on these 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 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 Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of their risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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 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, of the state of affairs of the Company as at 31 March, 2018, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("the order"), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we give in the "Annexure-A", a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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 including Other Comprehensive Income, the Cash Flow Statement 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 Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act read with rule 7 of the Companies (Account) rules, 2014

(e) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure-B".

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements -Refer Note 33 to the 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.

As referred to in our Independent Auditor''s Report of even date to the members of Kriti Nutrients Limited for the year ended March 31, 2018

1. FIXED ASSETS:

(a) As informed to us, the company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The entire records have been maintained on computer system through SAP.

(a) As informed and explained to us, the management, during the year, has physically verified the items of the fixed assets of the company at reasonable interval and no significant discrepancies were noticed on such physical verification.

(b) The land of the company for the factory is on Lease for 99 years since 1984 from Madhya Pradesh Audhyogik Kendra Vikas Nigam (Indore) Limited. The lease agreement is executed in the name of company.

2. Inventory:

(a) As informed and explained to us the inventory has been physically verified during the year by the management at regular intervals.

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

(c) In our opinion and according to the information given to us, the company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock.

3. Loans granted:

As per information and explanation given to us, the Company has not granted any secured/unsecured loans to companies, firms, LLP or other parties covered in the register maintained under section 189 of the Companies Act, 2013

4. Loan, Investment and Guarantees:

In our opinion and according to the information and explanations give to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.

5. Public Deposit:

According to the information and explanations given to us, the company has not accepted any deposits under sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under.

6. Cost Records:

We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 148(1) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained

7. Statutory Dues

(a) According to the books of accounts and records examined by us according to generally accepted auditing practices in India, in our opinion, the company has been regular in depositing undisputed statutory dues. According to the information and explanations given to us, there were no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income tax, Sales Tax, Customs Duty, Excise Duty, Service Tax, Cess and other material statutory dues which have remained outstanding as at 31st March 2018 for a period of more than six months from the date they became payable.

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

Sr. No.	Name of the Statute (Nature of the Dues)	Forum where Matter is pending	Period to which the amounts relates	Amount ( In Rs.)
1.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2004-05	21,55,460
2.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2005-06	81,41,497
3.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2005-06	8,95,411
4.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2006-07	8,70,630
5.	M.P. COMMERCIAL TAX	ADDITIONAL COMMISSIONER	2013-14	5,08,767
6.	CENTRALSALES TAX	M. P. HIGH COURT, JABALPUR	2006-07	1,14,25,030
7.	CENTRALSALES TAX	APPELLATE BOARD, BHOPAL	2005-06	32,699
8.	CENTRALSALESTAX	DEPUETY COMMISSIONER, INDORE	2014-15	63,454
9.	M.P. COMMERCIAL TAX	ADDITIONAL COMMISSIONER	2014-15	1,37,115
10.	M.P. COMMERCIAL TAX	ADDITIONAL COMMISSIONER	2015-16	1,27,843

Sr. No.	Name of the Statute (Nature of the Dues)	Forum where Matter is pending	Period to which the amounts relates	Amount ( In Rs.)
11.	ENTRYTAX	SALES TAX COMMISSIONER	2005-06	50,31,195
12.	ENTRYTAX	APPELLATE BOARD, BHOPAL	2007-08	18,22,609
13.	ENTRY TAX	APPELLATE BOARD, BHOPAL	2008-09	3,90,591
14.	ENTRY TAX	HIGH COURT	2006-07	3,85,348
15.	ENTRY TAX	HIGH COURT	2008-09	14,78,648

8. Default in repayment of dues to Financial Institutions, Banks, Government or debenture holders:

According to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

9. Utilization of Term Loans and Initial/Further Public offer:

According to information and explanation given to us, the company has not raised money by way of Initial/Further Public Offer and no term loan has been obtained by the company during the year.

10. Fraud Noticed or Recorded

According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the year under audit.

11. Managerial Remuneration

According to the information and explanations give 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.

12 . Nidhi Company:

In our opinion, the company is not a chit fund or a Nidhi mutual benefit fund/ society. Therefore, the provisions of clause (xii) of Para 3 of the said order are not applicable to the company.

13. Transaction with Related Parties:

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 financial statements as required by the applicable accounting standards.

14 Preferential Allotment/Private Placement:

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.

15. Non-Cash Transactions:

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.

16. Registration with Reserve Bank of India:

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 KRITI NUTRIENTS LIMITED, ("the Company"), as of 31 March 2018 in conjunction with our audit of the 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 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 auditor''s judgment, including the assessment of the risks of material misstatement of the 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 Ind AS 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 Ind AS 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 management and directors of the company;

(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 Ind AS 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 2018, 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 R.S. BANSAL & COMPANY

Chartered Accountants

FRN:000939C

(CA. Vijay Bansal)

Partner MNo:075344

Place: Indore

Date: 16.05.2018

---

Mar 31, 2016

To,

The Members,

Kriti Nutrients Limited 34, Siyaganj, Indore (M.P.)

Report on the Financial Statements:

We have audited the accompanying financial statements of KRITI NUTRIENTS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31,2016, and the Statement of Profit and Loss and Cash Flow Statement for the year ended March 31,2016, 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 stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

Auditor''s Responsibility:

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made 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 the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the Company has in place an adequate financial controls system over financial reporting and the operating effectiveness of such controls.

An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2016, and its profit and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements:

1) As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the "Annexure A" a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

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

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

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

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

(e) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164(2) of the Act.

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements as Refer Note 27.3 to the 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 were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

"Annexure A" to the Auditor''s Report as referred in paragraph first of our report of even date to the members of Kriti Nutrients Limitedfortheyearended31March2016

As required by the Companies Auditor''s Report Order, 2016 issued by the Central Government in terms of 143 of the Companies Act, 2013, we further report that:-

1. Fixed Assets:

a. As informed to us, the Company has maintained proper records, on yearly basis, showing full particulars, including quantitative details and situation of fixed assets. The entire records have been maintained on computer system through SAP.

b. As informed to us, the management of the Company has physically verified fixed assets at reasonable intervals, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets and no material discrepancies were noticed on such verification.

c. The land of the Company for the factory is on lease for 99 years since 1984 from Madhya Pradesh Audyogik Kendra Vikas Nigam (Indore) Limited. The lease agreement is executed in the name of the Company.

2. Inventories:

a. The inventory of the Company has been physically verified during the year by the management at regular intervals.

b. In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock.

3. Loans Granted:

As per information and explanation given to us, the Company has not granted any secured/unsecured loans to companies, firms, LLP or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

4. Loan, Investment and Guarantees:

As per information and explanation given to us, the Company has not granted any loan or given any guarantee on such loans covered under section 185 and neither it has made any investment covered under section 186 of the Companies Act, 2013.

5. Public Deposit:

In our opinion and according to the information and explanations given to us, the Company neither accepted nor invited any deposits from public within the provisions of Section 73 to 76 of Companies Act, 2013 and rules made there under. It is further informed by the Company that no order has been passed by Company Law Tribunal, National Company Law Tribunal, Reserve Bank of India or any other Tribunal in this regards.

6. Cost Records:

As explained and informed to us, the Company is required to maintain cost records as specified by the Central Government under section 148(1) of the Companies Act, 2013 in respect of the oil refining activities of the company. We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of the cost records to which said rules are made applicable and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have however, not made detailed examinations of the records with a view to determine whether they are accurate or complete.

7. Statutory Dues:

a. According to the information and explanation given to us, the Company has been generally regular in depositing undisputed dues relating to Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Duties of Customs, Duties of Excise, Value Added Tax, Cess and other material statutory dues applicable to it with appropriate authorities. There are no undisputed statutory dues payable which are outstanding as at March 31,2016 for a period of more than 6 months from the date they became payable.

b. According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Excise Duty & cess which have not been deposited on account of any dispute, except the following-

Sr. No	Name of the Statute (Nature of the Dues)	Forum where Matter is Pending	Period to which the amounts relates	Amounts (in Rs.)
1.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2004-05	21,55,460
2.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2005-06	81,41,497
3.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2005-06	8,95,411
4.	M.P. COMMERCIAL TAX	APPELLATE BOARD, BHOPAL	2006-07	8,70,630
5.	M.P. COMMERCIAL TAX	ADDITIONALCOMMISSIONER	2013-14	5,08,767
6.	CENTRALSALESTAX	M. P. HIGH COURT, JABALPUR	2006-07	1,14,25,030
7.	CENTRALSALESTAX	APPELLATE BOARD, BHOPAL	2005-06	32,699
8.	CENTRALSALESTAX	ADDITIONALCOMMISSIONER	2013-14	1,02,838
9.	ENTRYTAX	APPELLATE BOARD, BHOPAL	2004-05	7,99,081
10.	ENTRYTAX	SALESTAXCOMMISSIONER	2005-06	50,31,195
11.	ENTRYTAX	APPELLATE BOARD, BHOPAL	2006-07	5,13,848
12.	ENTRYTAX	APPELLATE BOARD, BHOPAL	2007-08	18,22,609
13.	ENTRYTAX	APPELLATE BOARD, BHOPAL	2008-09	3,90,591
14.	ENTRYTAX	APPELLATE BOARD, BHOPAL	2008-09	19,71,548

8. Default in repayment of dues to Financial Institutions, Banks, Government or debenture holders: -

Based on our audit and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of any loan from Financial Institutions, Government or Banks. No debentures have been issued by the Company till date and hence there are no debenture holders present.

9. Utilization of Term Loans and Initial/Further Public offer:

According to the information and explanations given to us, and based on documents provided to us, term loans availed by the Company were, prima-facie, applied by the Company for the purposes for which the loans were obtained. However, there were no new term loans that had been obtained during the year and neither any money was raised by way of further public offers.

10. Fraud Noticed or Recorded:

To the best of our knowledge and belief and according to the information and explanations given to us, no fraud by the Company and any fraud on the Company by its employees was noticed or reported during the period.

11. Managerial Remuneration:

According to the information and explanation given to us, and based on documents provided to us, the managerial remuneration has been provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Companies Act, 2013.

12. Nidhi Company:

As explained and informed to us, the Company is not a Nidhi Company and hence this clause is not applicable on it.

13. Transaction with Related Parties:

According to the information and explanation given to us and based on document provided to us, all transactions with the related parties are in compliance with section 177 & section 188 of the Companies Act 2013 and the details of the same have been duly disclosed in the financial statements as required by the applicable accounting standards.

14. Preferential Allotment/Private Placement:

According to the information and explanation given to us, the Company has not made any preferential allotment/private placement of shares or fully or partly convertible debenture during the year.

15. Non-Cash Transactions:

According to the information and explanation given to us, the Company has not entered into any non-cash transactions with Directors or Persons connected with him.

16. Registration with Reserve Bank of India:

The Company is a manufacturing concern and therefore, the Company is not required to be registered under section 45-IA of the Reserve Bank of IndiaAct,1934.

"Annexure B" to the Auditor''s Report as referred in paragraph first of our report of even date to the members of Kriti Nutrients Limited for the year ended 31^stMarch 2016.

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 Kriti Nutrients Limited ("the Company") as of March 31,2016 in conjunction with our audit of the 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 laying down 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. 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 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 Act.

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 Standards on Auditing, to the extent applicable to an audit of internal financial controls and the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note"), 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 auditor''s judgment, including the assessment of the risks of material misstatement of the 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 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 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 March 31,2016, 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: R. S. BANSAL & COMPANY

Chartered Accountants

FRN : 000939C

VIJAY BANSAL

Partner

M. No.: 075344

Date : May 12^th, 2016

Place: Indore

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Mar 31, 2015

We have audited the accompanying financial statements of KRITI NUTRIENTS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2015, and the Statement of Profit and Loss and Cash Flow Statement for the year ended March 31, 2015, and a summary of significant accounting policies and other explanatoryinformation.

Management'sResponsibility for the Financial Statements:

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

Auditor's Responsibility:

Ourresponsibility isto express an opinion on thesefinancial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company asat31stMarch,2015, anditsprofitand itscashflows for the yearended on that date.

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements- Refer Note 27.3 to the 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 were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.'

"Annexure A" to the Auditor's Report as referred in paragraph first of our report of even date to the members of Kriti Nutrients Limited for the year ended 31stMarch 2015.

As required by the Companies (Auditor's Report) Order, 2015 issued by the Central Government in terms of Section 143(11) of the Companies Act, 2013, we further report that :-

1. Fixed Assets:

a. As informed to us, the Company has maintained proper records, on yearly basis, showing full particulars, including quantitative details and situation of fixed assets. The entire records have been maintained on computer system through SAP.

b. As informed to us, the management of the Company has physically verified fixed assets at reasonable intervals, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets and no material discrepancies were noticed on such verification.

2. Inventories:

a. The inventory of the Company has been physically verified during the year by the management at regular interval.

b. In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock.

3. Loans Granted:

As per information and explanation given to us, the Company has not granted any unsecured loans to parties covered under section 189 of the Act.

4. Internal Control Procedures:

In our opinion and according to the information and explanation given to us, there are adequate internal control procedures 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. During the course of our audit, we have not observed any major weakness in such internal control system.

5. Public Deposit:

In our opinion and according to the information and explanations given to us, the Company neither accepted nor invited any deposits from public within the provision of Section 73 to 76 of Companies Act, 2013 and rules made there under.

6. Cost Records:

We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of the cost records under section 148 (1) of the Companies Act, 2013 in respect of the oil refining activities of the company to which said rules are made applicable and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made detailed examinations of the records with a view to determined whether they are accurate or complete.

7. Statutory Dues:

a. According to the information and explanation given to us, the Company has been generally regular in depositing undisputed dues relating to Provident Fund, Employees' State Insurance, IncomeTax, SalesTax, Wealth Tax, Service Tax, Duties of Customs, Duties of Excise, Value Added Tax, Cess and other material statutory dues applicable to it with appropriate authorities. There are no undisputed statutory dues payable which are outstanding as at March 31,2015 for a period of more than 6 months from the date they became payable.

b. According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty & cess which have not been deposited on account of any dispute, except the following -

"Annexure A" to the Auditor's Report as referred in paragraph first of our report of even date to the members of Kriti Nutrients Limited for the year ended 31stMarch 2015.

As required by the Companies (Auditor's Report) Order, 2015 issued by the Central Government in terms of Section 143(11) of the Companies Act, 2013, we further report that :-

1. Fixed Assets:

a. As informed to us, the Company has maintained proper records, on yearly basis, showing full particulars, including quantitative details and situation of fixed assets. The entire records have been maintained on computer system through SAP.

b. As informed to us, the management of the Company has physically verified fixed assets at reasonable intervals, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets and no material discrepancies were noticed on such verification.

2. Inventories:

a. The inventory of the Company has been physically verified during the year by the management at regular interval.

b. In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock.

3. Loans Granted:

As per information and explanation given to us, the Company has not granted any unsecured loans to parties covered under section 189 of the Act.

4. Internal Control Procedures:

In our opinion and according to the information and explanation given to us, there are adequate internal control procedures 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. During the course of our audit, we have not observed any major weakness in such internal control system.

5. Public Deposit:

In our opinion and according to the information and explanations given to us, the Company neither accepted nor invited any deposits from public within the provision of Section 73 to 76 of Companies Act, 2013 and rules made there under.

6. Cost Records:

We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of the cost records under section 148 (1) of the Companies Act, 2013 in respect of the oil refining activities of the company to which said rules are made applicable and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made detailed examinations of the records with a view to determined whether they are accurate or complete.

7. Statutory Dues:

a. According to the information and explanation given to us, the Company has been generally regular in depositing undisputed dues relating to Provident Fund, Employees' State Insurance, IncomeTax, SalesTax, Wealth Tax, Service Tax, Duties of Customs, Duties of Excise, Value Added Tax, Cess and other material statutory dues applicable to it with appropriate authorities. There are no undisputed statutory dues payable which are outstanding as at March 31,2015 for a period of more than 6 months from the date they became payable.

b. According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty & cess which have not been deposited on account of any dispute, except the following -

c. As per the information and explanations given to us there is no amount that is required to be transferred to Investor Education and Protection Fund in accordance with relevant provisions of Companies Act, 1956 (1 of 1956) and rules made thereunder.

S. Name of the Statute Forum where Matter is Period to which Amounts No (Nature of the Dues) Pending the amounts (in Rs.) relates 1. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2004-05 21,55,460

2. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2005-06 81,41,497

3. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2005-06 8,95,411

4. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2006-07 8,70,630

5. CENTRAL SALES TAX M. P. HIGH COURT, JABALPUR 2006-07 1,14,25,030

6. CENTRAL SALES TAX APPELLATE BOARD, BHOPAL 2005-06 32,699

7. CENTRAL SALES TAX ADDITIONAL COMMISSIONER OF 2012-13 1,35,525 COMMERCIAL TAX (APPEALS)

8. ENTRY TAX APPELLATE BOARD, BHOPAL 2004-05 7,99,081

9. ENTRY TAX SALES TAX COMMISSIONER 2005-06 50,31,195

10. ENTRY TAX APPELLATE BOARD, BHOPAL 2006-07 5,13,848

11. ENTRY TAX APPELLATE BOARD, BHOPAL 2007-08 18,22,609

12. ENTRY TAX APPELLATE BOARD, BHOPAL 2008-09 3,90,591

13. ENTRY TAX APPELLATE BOARD, BHOPAL 2008-09 19,71,548

8. Accumulated Cash Losses:

As informed and explained to us there is no accumulated cash losses of the Company. Further, the Company has not incurred any cash losses during the period covered by the report and immediately preceding the financial year.

9. Default in repayment of dues to Financial Institutions, Banks or debenture holders: -

Based on our audit and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of any loan from Financial Institutions or Banks.

10. Guarantee given by the Company for loan taken by Others:

According to the information and explanation given to us, the Company has not given any guarantee in respect of loan taken by others from any banks or financial institutions.

11. Utilization of Term Loans:

According to the information and explanations given to us, and based on documents provided to us, term loan availed by the Company were, prima-facie, applied by the Company for the purposes for which the loans were obtained. However, there were no new term loans that had been obtained during the year of audit.

12. Fraud Noticed or Recorded:

To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the period.

FOR: R. S. BANSAL & COMPANY Chartered Accountants Firm Reg. No.: 000939C

VIJAY BANSAL Partner Membership No.: 075344 Indore, 20th May, 2015

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Mar 31, 2014

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

Management''s Responsibility for the Financial Statements:

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that 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 judgement, 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:

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

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

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

Report on Other Legal and Regulatory Requirements

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

2) As required under Provision of section 227(3) of the Act, we reportthat

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

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the accounting standards referred to in sub-section (3C) of section 211 of the Act;

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

ANNEXURES TO THE INDEPENDENT AUDITOR''S REPORT

Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Kriti Nutrients Limited for the year ended on 31st March, 2014.

As required by the Companies Auditor''s Report Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we further report that :

1. In respect of its fixed assets:

a. As informed to us, the Company has maintained proper records, on yearly basis, showing full particulars, including quantitative details and situation of fixed assets. The entire records have been maintained on computer system through SAP.

b. As informed to us, the management of the Company has physically verified fixed assets at reasonable intervals, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets and no material discrepancies were noticed on such verification.

c. The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of fixed assets of the company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventories:

a. The inventory of the Company has been physically verified during the year by the management at regular interval.

b. In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock.

3. In respect of loans secured or unsecured granted or taken by the company:

(A) In respect of loan granted by the company:

a. As per information and explanation given to us, the Company has granted unsecured loans to parties covered under section 301. The details are as under :

Name Maximum Amount (in Rs.) Amount outst- anding (in Rs.)

Kriti Industries (I) Ltd. 5,74,93,572/- NIL

(A subsidiary of Holding Company)

b. The Company has charged interest on such loans, as per information made available to us, the other terms and conditions are prima facie not prejudicial to the interest of the company.

c. As per information and explanation given to us, receipt of principal and interest is as per the agreed terms.

d. As explained and informed to us, no amount is overdue as at the end of the year.

(B) In respect of loan taken by the company:

a. According to the information and explanation given to us, the Company has obtained unsecured loans from parties covered under section 301.

The details are as under:

Name Maximum Amount (in Rs.) Amount outst- anding (in Rs.)

Sakam Trading Pvt.Ltd 1,00,00,000/- 5O,OO,OO0/- (Holding Company)

Kriti Industries (I) Ltd. 2,50,00,000/- NIL/- (Subsidiary Company of Holding Company)

Chetak Builders Pvt. Ltd 50,00,000/- 50,00,000/- (Associate Company)

b. The Company has paid interest on such loans, as per information made available to us , the other terms and conditions are prima facie not prejudicial to the interest of the company.

c. As per information and explanation given to us, repayment of principal and interest is as per the agreed terms.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures 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. During the course of our audit, we have not observed any major weakness in such internal control system.

5. In respect of the contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

a. The particulars of contracts or arrangements referred to Section 301 that needed to be entered in the Register maintained under the said Section have been so entered.

b. The transactions have been entered at reasonable prices having regard to the prevailing market price at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company neither accepted nor invited any deposits from public within the provision of Section 58A, 58AA of Companies Act, 1956 and rules made there under.

7. As explained and informed to us, the Company has its own system for Internal Audit and the company works under SAP environment, which seems to be reasonable looking to the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of the cost records under section 209(1) (d) of the Companies Act, 1956 in respect of the oil refining activities of the company to which said rules are made applicable and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made detailed examinations of the records with a view to determined whether they are accurate or complete.

9. In respect of statutory dues :

a. According to the information and explanations given to us, there are no undisputed statutory dues payable in respect of Provident Fund, Employee''s State Insurance, Income Tax, Wealth Tax, Custom Duty, Excise Duty & Cess Investor Education and Protection Fund, which are outstanding for a period of more than 6 months as at the last date of financial year from the date they became payable.

b. According to the information and explanations given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty & cess which have not been deposited on account of any dispute, except the following.

Sl.no Name ofthe Statute Forum Where Matter (Nature of the Dues) is Pending

1. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL

2. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL

3. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL

4. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL

5. CENTRAL SALES TAX M. P. HIGH COURT, JABALPUR

6. CENTRAL SALES TAX APPELLATE BOARD, BHOPAL

7. ENTRY TAX APPELLATE BOARD, BHOPAL

8. ENTRY TAX APPELLATE BOARD, BHOPAL

9. ENTRY TAX APPELLATE BOARD, BHOPAL

10. ENTRY TAX APPELLATE BOARD, BHOPAL

11. ENTRY TAX APPELLATE BOARD, BHOPAL

12. ENTRY TAX APPELLATE BOARD, BHOPAL



Sl.no Name of the Statute Period to Which the Amuunt(inRs.) (Nature of the Dues) amount relates

1. M.P.COMMERCIAL TAX 2004-05 21,55,460

2. M.P.COMMERCIAL TAX 2005-06 81,41,497

3. M.P.COMMERCIAL TAX 2005-06 8,95,411 4. M.P.COMMERCIAL TAX 2006-07 8,70,630

5. CENTRAL SALES TAX 2006-07 1,14,25,030

6. CENTRAL SALES TAX 2005-06 32,699 7. ENTRY TAX 2004-05 7,99,081

8. ENTRY TAX 2005-06 50,31,195

9. ENTRY TAX 2006-07 5,13,848

10. ENTRY TAX 2007-08 18,22,609

11. ENTRY TAX 2008-09 3,90,591

12. ENTRY TAX 2008-09 19,71,548

10. As informed and explained to us there is no accumulated cash losses of the Company. Further, the Company has not incurred any cash losses during the period covered by the report and immediately preceding the financial year.

11. Based on our audit and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of any loan from Financial Institutions or Banks.

12. According to the information and explanation given to us, the Company has not given any loans and advances on the basis of security by way of Pledge of Shares, debentures and other securities.

13. Provision relating to any special statute applicable to chit fund is not applicable to the Company.

14. According to the information and explanations given to us, the Company is not dealing or trading in share, securities, debentures and other investments.

15. According to the information and explanation given to us, the Company has not given any guarantee in respect of loan taken by others from any banks or financial institutions.

16. According to the information and explanations given to us, and based on documents provided to us, term loan availed by the Company were, prima-facie, applied by the Company for the purposes for which the loans were obtained.

17. According to the information and explanations given to us, and based on documents provided to us, we are of the opinion that no short-term fund has been utilized for long term investment.

18. We are informed that, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained u/s 301 of the Act.

19. According to the information and explanations given to us and records examined by us, the Company has not issued debentures and hence regarding creation of securities in respect of debentures issued does not arise.

20. The Company has not raised any money by public issue of shares during the period.

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



FOR: R. S. BANSAL & COMPANY Chartered Accountants Firm Reg. No. : 000939C

VIJAY BANSAL Partner Membership No. : 075344 Indore, 29th May, 2014

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Mar 31, 2013

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

Management''s Responsibility for the Financial Statements:

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility:

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

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

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

Opinion:

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

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

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the accounting standards referred to in sub-section (3C) of section 211 of the Act;

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

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date to the members of Kriti Nutrients Limited for the year ended on 31st March, 2013.

As required by the Companies Auditor''s Report Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we further report that :-

1. In respect of its fixed assets:

a. As informed to us, the Company has maintained proper records, on yearly basis, showing full particulars, including quantitative details and situation of fixed assets. The entire records have been maintained on computer system through SAP.

b. As informed to us, the Company has physically verified fixed assets during the year. According to information and explanation given to us no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanation given to us, the Company has not disposed off any substantial assets during the year which has affected its status as going concern.

2. In respect of its inventories:

a. The inventory of the Company has been physically verified during the year by the management at regular interval.

b. In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock as compared to book records.

3. In respect of loans secured or unsecured granted or taken by the company:

(A) In respect of loan granted by the company-

a. As per information and explanation given to us, the Company has granted unsecured loans to parties covered under section 301. The details are as under :-

Name Maximum Amount (In Rs.) Amount Outstanding (In Rs.)

Kriti Industries (I) Ltd.

(A subsidiary of Holding Company) 11,96,98,667/- NIL

b. The Company has charged interest on such loans, as per information made available to us, the other terms and conditions are prima facie not prejudicial to the interest of the company.

c. As per information and explanation given to us, receipt of principal and interest is as per the agreed terms.

d. As explained and informed to us, no amount is overdue as at the end of the year.

(B) In respect of loan taken by the company-

a. According to the information and explanation given to us, the Company has obtained unsecured loans from parties covered under section 301. The details are as under:-

Name Maximum Amount (In Rs.) Amount Outstanding (In Rs.)

Sakam Trading Pvt. Ltd. (Holding Company) 2,65,50,745 /- 1,00,35,260/-

Kriti Industries (I) Ltd. ( Subsidiary Company of Holding Company) 3,70,00,000 /- 6,66,825/-

b. The Company has paid interest on such loans, as per information made available to us, the other terms and conditions are prima facie not prejudicial to the interest of the company.

c. As per information and explanation given to us, repayment of principal and interest is as per the agreed terms.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures 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.

5. In respect of the contracts or arrangements referred to in Section 301 of the Companies Act, 1956:

a. As explained & informed to us Company has entered all transactions, which are required to be entered in the register maintained in pursuant of the Section 301 of the Companies Act, 1956.

b. As per information and explanation given to us, the transactions have been entered at reasonable prices having regard to the prevailing market price at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company neither accepted nor invited any deposits from public within the provision of Section 58A, 58AA of Companies Act, 1956 and rules made there under.

7. As explained and informed to us, the Company has its own system for Internal Audit and the company works under SAP environment, which seems to be reasonable looking the size and nature of its business.

8. We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of the cost records under section 209(1) (d) of the Companies Act, 1956 in respect of the refining activities of the company to which said rules are made applicable and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made detailed examinations of the records with a view to determined whether they are accurate or complete.

9. In respect of statutory dues:

a. According to information and explanations given to us, there are no undisputed statutory dues payable in respect of Provident Fund, Employee''s State Insurance, Income Tax, Wealth Tax, Custom Duty, Excise Duty & Cess Investor Education and Protection Fund, which are outstanding for a period of more than 6 months as at the last date of financial year from the date they became payable, except for the following:-

S. No. Name of the Statute Period to which the Amount (in Rs.) amounts relates

1. WEALTH TAX 2011-12 6,542

b. According to the information & explanations given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty & cess which have not been deposited on account of any dispute, except the following -

S. No. Name of the Statue Forum where Dispute is pending Period to Amount which the in Rs. amounts relates

1. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2004-05 21,55,460

2. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2005-06 81,41,497

3. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2005-06 8,95,411

4. VAT APPELLATE BOARD, BHOPAL 2006-07 8,70,630

5. CENTRAL SALES TAX M. P. HIGH COURT, JABALPUR 2006-07 1,14,25,030

6. CENTRAL SALES TAX APPELLATE BOARD, BHOPAL 2005-06 32,699

7. ENTRY TAX APPELLATE BOARD, BHOPAL 2004-05 7,99,081

8. ENTRY TAX APPELLATE BOARD, BHOPAL 2005-06 50,31,195

9. ENTRY TAX APPELLATE BOARD, BHOPAL 2006-07 5,13,848

10. ENTRY TAX APPELLATE BOARD, BHOPAL 2007-08 18,22,609

11. ENTRY TAX APPELLATE BOARD, BHOPAL 2008-09 3,90,591

12 ENTRY TAX APPELLATE BOARD, BHOPAL 2008-09 19,71,548



10. As informed and explained to us there is no accumulated cash losses of the Company. Further, the Company has not incurred any cash losses during the period covered by the report and immediately preceding the financial year.

11. Based on our audit and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of any loan from Financial Institutions or Banks.

12. According to the information and explanation given to us, the Company has not given any loans and advances on the basis of security by way of Pledge of Shares, debentures and other securities.

13. Provision relating to any special statute applicable to chit fund is not applicable to the Company.

14. According to the information and explanations given to us, the Company is not dealing or trading in share, securities, debentures and other investments.

15. According to the information and explanation given to us, the Company has not given any guarantee in respect of loan taken by others from any banks or financial institutions.

16. According to the information and explanations given to us, and based on documents provided to us, term loan availed by the Company were, prima-facie, applied by the Company for the purposes for which the loans were obtained.

17. According to the information and explanations given to us, and based on documents provided to us, we are of the opinion that no short-term fund has been utilized for long term investment.

18. We are informed that, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained u/s 301 of the Act.

19. According to the information and explanations given to us and records examined by us, the Company has not issued debentures and hence regarding creation of securities in respect of debentures issued does not arise.

20. The Company has not raised any money by public issue of shares during the period.

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



FOR: R.S.BANSAL & COMPANY

CHARTERED ACCOUNTANTS

FRN: 000939C



(VIJAY BANSAL)

PLACE: INDORE PARTNER

DATE : 4th May, 2013 M.N.075344

---

Mar 31, 2012

We have audited the attached Balance-Sheet of KRITI NUTRIENTS LIMITED as at 31-03-2012 and also the Statement of Profit & Loss and Cash Flow statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

We 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.

1) As required by the Companies (Auditors Report) Order, 2003 (CARO) issued by Central Government under Section 227(4A) of the Companies Act, 1956 (here-in-after referred to as the Act), and on the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of audit, we give in the Annexure a statement to the matters specified in Paragraph 4 & 5 of the said order to the extent applicable to Company.

2) Further to our comments in the Annexure referred to paragraph 1 above we report that:

a) We have obtained all the information and explanations, which to the best of our knowledge & beliefs 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 it appears from our examination of those books.

c) The Balance Sheet, Statement of Profit & Loss and Cash Flow Statement dealt with by this report are in agreement with the books of accounts of the Company.

d) In our opinion, the Balance Sheet, Statement of Profit & Loss and Cash Flow Statement comply with the Accounting Standards referred to in Sub-Section (3C) ofSection 211 ofthe Companies Act, 1956 to the extent applicable.

e) On the basis of written representations received from the Directors, as on 31st March, 2012 and taken on record by the Board of Directors we report that none of the directors is disqualified as on 31st March, 2012 from being appointed as Director in terms of Clause (g) ofSub-Section (1) ofSection 274 ofthe Companies Act,1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with notes to accounts, gives 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 principals generally accepted in India:

i) In the case of Balance Sheet, of the State of Affairs of the Company as at March 31st, 2012.

ii) In the case of 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.

ANNEXURE TO THE AUDITOR'S REPORT AS REFERRED IN PARAGRAPH ONE OF REPORT OF EVEN DATE TO THE MEMBERS OF KRITI NUTRIENTS LIMITED FOR THE YER ENDED ON 31-03-2012

As required by the Companies Auditor's Report Order, 2003 issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we further report that :-

1. In respect of its fixed assets:

a. As informed to us, the Company has maintained proper records, on yearly basis, showing full particulars, including quantitative details and situation of fixed assets. The records have been maintained on computer system through SAP.

b. As informed to us, the Company has physically verified fixed assets during the year. According to information and explanation given to us no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanation given to us, the Company has not disposed off Substantial assets during the year which has affected its status as going concern.

2. In respect of its inventories:

a. The inventory of the Company has been physically verified during the year by the management at regular interval.

b. In our opinion and according to the information and explanation given to us, the procedure of physical verification of inventories followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. No material discrepancies have been noticed on physical verification of stock as compared to book records.

3. In respect of loans secured or unsecured granted by the company:

a. As per information and explanation given to us, the Company has granted unsecured loans to parties covered under Section 301. The details are as under :-

Name Maximum Amount (In Rs.) Amount Outstanding (In Rs.)

Kriti Industries (I) Ltd.

(A subsidiary of Holding Company) 7,88,75,827 /- NIL

b. The Company has charged interest on such loans, as per information made available to us, the other terms and conditions are prima facie not prejudicial to the interest of the company.

c. As per information and explanation given to us, repayment of principal and interest is as per the agreed terms.

d. As explained and informed to us, no amount is over due as at the end of the year.

4. In respect of loans secured or unsecured granted by the company:

a. According to the information and explanation given to us, the Company has obtained unsecured loans from parties covered under Section 301.

The details are as under : -

Name Maximum Amount (In Rs.) Amount Outstanding (In Rs.)

Kriti Corporate Services Pvt. Ltd. 2,65,56,384 /- 2,65,50,745/-

(Merged with Sakam Trading Pvt. Ltd.

vide order of Hon'ble High Court dated 01.11.2011

and merger affected on 27.02.2012)

Kriti Indu stries (I) Ltd. 6,68,25,317 /- 90,00,000/-

( Subsidiary Company of Hol ding Company)

b. The Company has paid interest on such loans, as per information made available to us, the other terms and conditions are prima facie not prejudicial to the interest of the company.

c. As per information and explanation given to us, repayment of principal and interest is as per the agreed terms.

5. In our opinion and according to the information and explanation given to us, there are adequate Internal Control procedures 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.

6. In respect ofthe contracts or arrangements referred to in Section 301 ofthe Companies Act, 1956:

a. As explained & informed to us Company has entered all transactions, which are required to be entered in the register maintained in pursuant of the Section 301 of the Companies Act, 1956.

b. As per information and explanation given to us, the transactions have been entered at reasonable prices having regard to the prevailing market price at the relevant time.

7. In our opinion and according to the information and explanations given to us, the Company neither accepted nor invited any deposits from public within the provision of Section 58A, 58AA of Companies Act, 1956 and rules made there under .

8. As explained and informed to us, the Company has its own system for Internal Audit, which seems to be reasonable looking the size and nature of its business.

9. We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government for the maintenance of the cost records under section 209(1) (d) of the Companies Act, 1956 in respect of the refining activities of the company to which said rules are made applicable and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made detailed examinations of the records with a view to determined whether they are accurate or complete.

10. In respect of statutory dues:

a. According to information and explanations given to us, there are no undisputed statutory dues payable in respect of Provident Fund, Employee's State Insurance, Income Tax, Wealth Tax, Custom Duty, Excise Duty & Cess Investor Education and Protection Fund, which are outstanding for a period of more than 6 months as at the last date of financial year from the date they became payable.

b. According to the information & explanations given to us, there are no dues of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty & cess which have not been deposited on account of any dispute, except the following -

S. No. Name of the Statue Forum where Dispute is pending Period to Amount which the in Rs. amounts relates

1. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2004-05 21,55,460

2. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2005-06 81,41,497

3. M.P. COMMERCIAL TAX APPELLATE BOARD, BHOPAL 2005-06 8,95,411

4. VAT APPELLATE BOARD, BHOPAL 2006-07 8,70,630

5. CENTRAL SALES TAX M. P. HIGH COURT, JABALPUR 2006-07 1,14,25,030

6. CENTRAL SALES TAX APPELLATE BOARD, BHOPAL 2005-06 32,699

7. ENTRY TAX APPELLATE BOARD, BHOPAL 2004-05 7,99,081

8. ENTRY TAX APPELLATE BOARD, BHOPAL 2005-06 50,31,195

9. ENTRY TAX APPELLATE BOARD, BHOPAL 2006-07 5,13,848

10. ENTRY TAX APPELLATE BOARD, BHOPAL 2007-08 18,22,609

11. ENTRY TAX APPELLATE BOARD, BHOPAL 2008-09 3,90,591

12. ENTRY TAX ADDT.COMMISSIONER, INDORE 2006-07 22,14,904

13. ENTRY TAX APPELLATE BOARD, BHOPAL 2008-09 19,71,548

11 As informed and explained to us there is no accumulated cash losses of the Company. Further, the Company has not incurred any cash losses during the period covered by the report and immediately preceding the financial year.

12. Based on our audit and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of any loan from Financial Institutions or Banks.

13. According to the information and explanation given to us, the Company has not given any loans and advances on the basis of security by way of Pledge of Shares, debentures and other securities.

14. Provision relating to any special statute applicable to chit fund is not applicable to the Company.

15. According to the information and explanations given to us, the Company is not dealing or trading in share, securities, debentures and other investments.

16. According to the information and explanation given to us, the Company has not given any guarantee in respect of loan taken by others from any banks or financial institutions.

17. According to the information and explanations given to us, and based on documents provided to us, term loan availed by the Company were, prima-facie, applied by the Company for the purposes for which the loans were obtained.

18. According to the information and explanations given to us, and based on documents provided to us, we are of the opinion that no short-term fund has been utilized for long term investment.

19. We are informed that, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained u/s 301 of the Act.

20. According to the information and explanations given to us and records examined by us, the Company has not issued debentures and hence regarding creation of securities in respect of debentures issued does not arise.

21. The Company has not raised any money by public issue of shares during the period.

22. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the period.

FOR: R. S. BANSAL AND COMPANY

CHARTERED ACCOUNTANTS

FRN: 000939C



(VIJAY BANSAL)

PARTNER

M.NO.075344



Place: Indore

Date : 26-05-2012

---

Dec 31, 2009

1) We have audited the attached Balance Sheet of Kriti Nutrients Limited as at 31st December, 2009 and also the Profit and Loss Account & the Cash Flow Statement of the Company for the period ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2) We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An Audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing die 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) We report that:

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

b) In our opinion, proper books of accounts required by law have been kept by the company as far as appears from our examination of such books.

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

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

e) On the basis of the written representations received from the directors as on 31st December, 2009 and taken on record by the Board of Directors, we report mat none of the directors is disqualified as on 31st December, 2009 from being appointed as a Director in terms of clause (g) of sub section (1) of Section 274 of the Companies Act, 1956.

4. In our opinion and to the best of our information and according to the explanation given to us, the said accounts read widi significant accounting policies and other notes thereon, gives the information required by the Companies Act, 1956, in the manner required and gives 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 December, 2009;

ii) In the case of Profit and Loss Account of the loss of the company for the period ended on that date; and

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

5. As required by the Companies (Auditors Report) Order, 2003 as amended by Companies (Auditors Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and according to information & explanation given to us and on the basis of such checks we considered appropriate, we further state that:

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

(b) The Company has physically verified certain assets during the year in accordance with a programme of verification, which in our opinion provides for physical verification of the fixed assets at reasonable intervals. According to the information and explanations given to us no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, the Company has not made any disposal of fixed assets during the year.

(ii) (a) Since there is no inventory and therefore question of physical verification and maintenance of its record does notarise.

(iii) (a-d) Since Company has not given any loan, to firms, Companies or other parties covered in the register maintained under section 301 of the Companies Act 1956, hence clause (a-d) are not applicable.

(e) The Company has taken loan from person covered in the register maintained u/s 301 of the Companies Act 1956. The maximum amount involved during the year 130430/- and credit balance Rs. 130430/-.

(f) No interest has been given on loan, however other term and condition are not prejudicial to the interest of the Company.

(g) There is no stipulated time for repayment of principal and therefore question of comments over regularity of repayment, does not arise.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of fixed assets, however there is no sale/purchase of goods and services. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act that needs to be entered into the register maintained under that Section, have been so entered.

(b) According to the information and explanations given to us, there is no transaction in excess of Rs. 5 lakhs in respect of any party and hence the question of reasonable prices in respect of such transactions with regard to the prevailing market prices does not arise.

vi) The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under and therefore clause is not applicable to the company.

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

viii) The Company is not required to maintain cost records in terms of Sec 209( 1) (d) of the Companies Act, 1956.

ix) (a) According to the information and explanation given to us and the records of the Company examined by us, there were no undisputed dues either paid during the period nor payable and hence question of our comments on their regular deposit or otherwise does not arise.

(b) According to the records of the Company, there are no disputed dues in respect of Sales Tax, Entry Tax and Income Tax.

(x) The Company has accumulated losses at the end of the financial year and has incurred cash losses during the current and the immediately preceding financial year.

(xi) Based on our audit procedures and as per the information and explanation given by the management, we are of the opinion that the company has not defaulted in the repayment of dues to financial institutions, banks or debenture holders.

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

(xiii) The provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund/societies are not applicable to the Company.

(xiv) In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other Investments.

(xv) Company has not given any guarantees for loans taken by others from banks or institutions, and therefore commenting over terms and conditions does not arise.

(xvi) To the best of our knowledge and belief and according to the information and explanations given to us, that no term loans has been taken by the Company and therefore question of comments over its utilization does not arise.

(xvii) According to the cash flow statement and other records examined by us and the information and explanations given to us, on an overall basis, funds raised on short term basis have prima facie not been used during the year for long term investment (fixed assets, etc).

(xviii) The Company has not made preferential allotment of shares to the parties and companies under section 301 of the Act.

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

(xx) The Company has not raised any money by public issue during the year, and therefore question of endure does not arise.

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

For SUBHASH DESHPANDE & CO.

CHARTERED ACCOUNTANTS

F.R.N. 000476C

(R.D.ASAWA)

PLACE -.INDORE PARTNER

DATED: 26th APRIL, 2010 M.No. 16562