Auditor Report of Pearl Polymers Ltd.

Mar 31, 2016

INDEPENDENT AUDITOR''S REPORT

To

THE MEMBERS OF

M/s PEARL POLYMERS LTD.

A-97/2, Industrial Area, Phase-II,

Okhla, New Delhi-110020

Dear Sir,

We have audited the accompanying financial statements of M/S PEARL POLYMERS LTD. (“the Company”), which comprise the Balance Sheet as at March 31, 2016, and the Statement of Profit and Loss for the year ended, Cash Flow Statement for the year ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

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

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

An Audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal 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 on the financial statement.

Opinion

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

i) In the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2016.

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

iii) In the case of 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, 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 the paragraph 3 and 4 of the order.

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

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

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

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

d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Act which continue to be applicable in respect of Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of written representations received from the directors as on March 31, 2016 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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”; and

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 amount required to be transferred to the Investor Education and Protection Fund by the company.

Annexure - A to the Auditors'' Report

The Annexure referred to in Independent Auditors'' Report to the members of the Company on the financial statements for the year ended 31 March 2016, we report that:

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

(b) As explained to us, all the assets have not been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

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

ii) (a) As explained to us, the inventories have been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable having regard to the size of the Company and the nature of its business.

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

(c) In our opinion and according to the information and explanations given to us, the company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of the inventories having regard to the size of the operations of the company.

iii) As explained to us, the company had not granted any loans, secured or unsecured, to any companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Act.

iv) The company has not granted any loan, made any investments, provided any guarantee and security within the meaning of section 185 and 186 of the Companies Act, 2013.

v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits in contravention of Directives issued by Reserve Bank of India and the provisions of section 73 to 76 or any other relevant provisions of the Act and the rules framed there under, where applicable. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.

vi) As explained to us, The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the activities such as engaged in the production of goods or providing services by the Company.

vii) (a) According to the records of the company the company is generally regular in depositing with appropriate authorities

undisputed statutory dues including provident fund, investor education protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, Cess and other material statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, Service Tax, sales tax, custom duty, excise duty and Cess were in arrears, as at 31^st March, 2016 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the dues of sales tax, income tax, excise duty and Cess that have not been deposited with appropriate authorities on account of any dispute and the forum where the disputes are pending are given below:-

Name of the Statute	Nature of the Dues	Amount fln’Lakhs)	Period to which the amount relates	Forum where the dispute is pending
The Central Excise Act, 1944	Producing and clearing dutiable and non-dutiable product under Notification No.4/97	370.59	March 1997 to June 1997	Supreme Court of India
The Central Excise Act, 1944	Interest on differential duty paid in respect of supplementary invoices	0.40	January 2001 to April 2003	CESTAT

The Central Excise Act, 1944 Disallowance of Cenvat Credit on 5.14 July 2004 to Commissioner of the supply of pet chips August 2004 Customs & Central Excise (Appeals), Mumbai ill

The Central Excise Act, 1944 Service Tax demand on 0.04 Jnauray 2005 to Assistant Commissioner transportation- Abatement not March 2005 of Central Excise CBD allowed Belapur.

The Central Excise Act, 1944 Interest demand on reversed 0.21 2014-2015 Assistant Commissioner cenvat credit pointed out in EA of Central Excise Mumbai 2000 Audit.

The Central Excise Act, 1944 Interest on late payment of duty 0.61 2014-2015 Assistant Commissioner pointed out in EA 2000 Audit. of Central Excise Mumbai

The Sales Tax Act Sales tax assessment VAT demand 102.67 2005-2006 Appeal Commissioner of Sales Tax

The Sales Tax Act Sales tax assessment CST 123.84 2005-2006 Appeal Commissioner of demand Sales Tax

The Sales Tax Act Sales tax assessment CST 11.85 2008-2009 Appeal Commissioner of demand Sales Tax

The Sales Tax Act Exemption given for business 9.88 2002-03 Dt.Commissioner of expansion under FAVC is not Commercial Taxes,

supported by ‘C’ Forms Bangalore

The Central Excise Act, 1944 Demand raised on wrong 4.41 April''06-Dec’09 CESTAT, Bangalore computation of assessable value

The Income Tax Act, 1961 Demand u/s 271(1 )(c) 3.74 AY 2009-10 Appeal pending before CIT(A), Delhi

The Income Tax Act, 1961 Demand u/s 143(3) 17.49 AY 2010-11 Appeal pending before ITAT

The Income Tax Act, 1961 Demand u/s 143(3) 44.12 AY 2011-12 Rectification filled before Assessing Officer, Delhi

The Income Tax Act, 1961 Demand u/s 271(1) 1.29 AY2011-12 Appeal pending before CIT(A) Delhi

viii) According to the information and explanations given to us, and the records of the companies examined by us, the Company has not defaulted in repayment of loans or borrowings to a financial institution and banks.

ix) The Company has not raised any money by way of initial public offer or further public offer Order is not applicable.

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

xi) According to the information and explanations 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.

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

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

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

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

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

Annexure - B to the Auditors'' Report

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

We have audited the internal financial controls over financial reporting of M/s Pearl Polymers Limited (“the Company”) as of 31 March 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 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 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 31 March 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.

Place: New Delhi For Sehgal Mehta & Co.

Date: 30.05.2016 Chartered Accountants

FRN-003330N

(CA Naresh Khanna)

Partner M.No. 081482

---

Mar 31, 2015

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

Management's Responsibility for the Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made 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 internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub- section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 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 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 March 31, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2015 from being appointed as a director in terms of Section 164 (2) of the Act, and

(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 33 to the financial statements.

ii. The Company has not entered into any long term contracts including derivative contracts and accordingly it is not required to make provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on the same.

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

Annexure to the Independent Auditors' Report

The Annexure referred to in our Independent Auditors' Report to the members of the Company on the financial statements for the year ended 31 March 2015, we report that:

(I) In respect of its fixed assets:

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

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

(ii) In respect of inventories:

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

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

(c) The discrepancies between the physical stock and book stock have been adjusted in the books.

(iii) The Company has not granted any loan, secured, or unsecured to bodies corporate, firms and other parties covered in the register maintained under section 189 of the Companies Act, 2013 ('the Act'). Hence this clause is not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) The Company has not accepted any deposits from the public so the said clause of the report is accordingly not applicable to the company.

(vi) As per rule 5 of Companies (Cost Records and Audit) Rules, 2014 company is not required to maintain the cost records pursuant to Section 148 of the Companies Act, 2013.

(vii) According to the information and explanations given to us in respect of statutory dues:

(a) Amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of employees' state insurance and duty of excise.

(b) There were no undisputed amounts payable in respect of provident fund, income tax, sales tax, wealth tax, service tax, custom duty, value added tax, cess and other material statutory dues were in arrears as at March 31,2015 for a period of more than six months from the date they became payable.

(c) There were no material dues of wealth tax, custom duty and cess which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following dues of income tax, sales tax, service tax and value added tax have not been deposited by the Company on account of disputes:

Name of the Statute Nature of the Dues Amount (Rs. in Lakhs)

The Central Excise Act, 1944 Producing and clearing 360.59 dutiable and non-dutiable product under Notification No.4/97

The Central Excise Act, 1944 Excise duty on freight 72.72

The Central Excise Act, 1944 Interest on differential duty 0.40 paid in respect of supplementary invoices

The Central Excise Act, 1944 Disallowance of Cenvat 72.65 Credit on Shrink Films

The Central Excise Act, 1944 Disallowance of Cenvat 9.11 Credit on Shrink Films

The Central Excise Act, 1944 Disallowance of Cenvat 4.35 Credit on Shrink Films / Shrink Sleeves

The Central Excise Act, 1944 Disallowance of Cenvat 4.27 Credit on Shrink Films / Shrink Sleeves

The Central Excise Act, 1944 Penalty 7.50

The Central Excise Act, 1944 Excise Duty 61.95 Penalty 61.95 Interest 81.47

The Central Excise Act, 1944 Disallowance of Cenvat 0.42 Credit on Shrink Films/Shrink Sleeves

The Central Excise Act, 1944 Disallowance of Cenvat 5.00 Credit on the supply of pet chips

The Central Excise Act, 1944 Service Tax demand on 0.04 transportation -Abatement not Allowed

The Sales Tax Act Sales tax in respect of 32.48 exempted sales

The Central Excise Act, 1944 Disallowance of CENVAT 0.10 Credit on Shrink Films/Shrink Sleeves

The Central Excise Act, 1944 Disallowance of CENVAT 0.33 Credit on Shrink Films/Shrink Sleeves

The Central Excise Act, 1944 Disallowance of CEN VAT 2.56 Credit on Shrink Films/Shrink Sleeves

The Sales Tax Act Assessment order passed 9.61

The Sales Tax Act Exemption given for 19.77 business expansion under FAVC is not supported by C Forms

The Central Excise Act, 1944 Demand raised on wrong computation of assessable value

The Income Tax Act, 1961 Assessment u/s 271(1)(c) 3/74

The Income Tax Act, 1961 Assessment u/s 143(3) 18.12

The Central Excise Act, 1944 Disallowance of Cenvat credit on shrink films

The Central Excise Act, 1944 Disallowance of Cenvat credit on shrink films

The Central Excise Act, 1944 Disallowance of Cenvat credit on shrink films

Total 840.46



Name of the Statute Period to which Forum where the the amount relates dispute is pending

The Central Excise Act, 1944 March 1997 to Supreme Court June 1997 of India



The Central Excise Act, 1944 March 1997 to CESTAT December 2001 The Central Excise Act, 1944 January 2001 to CESTAT April 2003

The Central Excise Act, August 2001 to Commissioner February 2006 of Central Excise, Raigad

The Central Excise Act, March 2006 to Assistant February 2007 Commissioner of Central Excise, CBD Belapur

The Central Excise Act, March 2007 to Assistant January 2008 Commissioner of Central Excise, CBD Belapur

The Central Excise Act, February 2008 to Assistant December 2008 Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 2004-05 CESTAT Delhi.

The Central Excise Act, 1944 2002-03 CESTAT Delhi



The Central Excise Act, February 2009 to Assistant December 2009 Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 July 2004 to Commissioner August 2004 of Customs & Central Excise (Appeals), Mumbai III

The Central Excise Act, 1944 January 2005 to Assistant March 2005 Commissioner of Central Excise, CBD Belapur

The Sales Tax Act 2002-03 & Sales tax 2003-04 Appellate Tribunal, Haryana.

The Central Excise Act, 1944 January 2010 to Assistant December 2010 Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 January 2011 to Assistant October 2011 Commissioner of Central Excise, CBD Belapur



The Central Excise Act, 1944 November 2011 to Assistant September 2012 Commissioner of Central Excise, CBD Belapur

The Sales Tax Act 2009-10 Assistant Commissioner of Sales Tax

The Sales Tax Act 2002-03 Dt.Commissioner of Commercial Taxes, Bangalore

The Central Excise Act, 1944 April 2006- CESTAT, December 2009 Bangalore

The Income Tax Act, 1961 AY 2009-10 CIT(A), Delhi

The Income Tax Act, 1961 AY 2011-12 I TAT, Delhi

The Central Excise Act, 1944 October 2012- Asst.CCE.Raigad June 2013

The Central Excise Act, 1944 July 2013- Asst.CCE.Raigad February 2014

The Central Excise Act, 1944 March 2014- Asst.CCE.Raigad December 2014

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

(ix) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders.

(x) According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year.

(xi) The Company has raised new term loans during the year amounting to Rs 369.30 lakhs. The term loans have been applied for the purposes for which they were raised.

(xii) In our opinion and 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.

For Sehgal Mehta & Co. Chartered Accountants F.R.N. No. 003330N

Place: New Delhi Naresh Khanna Date : May 27, 2015 Partner M.No. 081482

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Mar 31, 2014

Report on the Financial Statements

We have audited the accompanying financial statements of Pearl Polymers Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014, the Statement of Profit and Loss and Cash Flow Statement for the year ended and a summary of significant accounting policies and other explanatory information. Management''s Responsibility for the Financial Statements Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act,1956 ("the Act") read with the general circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

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

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

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

Opinion

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

(a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 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"),as amended, issued by the Central Government of India in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

c. The Balance Sheet, 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 Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in section 211(3C) of the Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013; and

e. On the basis of the written representations received from the directors as on March 31, 2014, 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 Section 274(1)(g) 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.

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b) As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

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

2. In respect of its inventories:

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

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

c) The discrepancies between the physical stock and book stock have been adjusted in the books.

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

a) In our opinion and according to information given to us, the company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly provisions of paragraphs 4(iii) (b) to 4(iii)(d) of the Order are not applicable.

b) In our opinion and according to information given to us, the Company has taken unsecured loans with from three parties covered in the register maintained under Section 301 of the Companies Act, 1956 aggregating to Rs. 85 Lacs. The loans have not been fully repaid during the year to the parties covered u/s 301 of the Companies Act, 1956. The balance as on the close of the year was Rs. 97.50 lacs. in respect of loans (with interest).

c) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and conditions on which fixed deposit and loan have been taken from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are not prima facie prejudicial to the interest of the company.

d) In respect of the fixed deposit and loan taken, the company is repaying the principal amount and paying the interest as stipulated.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

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

(a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 exceeding the value of Rupees Five Lakhs or more in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of Section 58A, 58AA or any other relevant provisions of Act, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As per the information and explanations given to us, no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the Company in respect of deposits accepted.

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

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. In respect of statutory dues:

a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess, and other statutory dues have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at March 31, 2014 for a period of more than six months from the date of becoming payable. There are no amounts due & outstanding for the period exceeding 6 months as at March 31, 2014 to be credited to Investor Education & Protection Fund.

b) The disputed statutory dues that have not been deposited on account of disputed matters pending before appropriate authorities are as under:

Name of the Statute Nature of the Dues Amount (Rs. In''Lakhs)

Income Tax Assessment u/s 143(3) 7.48

The Central Excise Act, Producing and clearing 1944 dutiable and non- dutiable 360.59 product under Notification No.4/97

The Central Excise Act, Excise duty on freight 72.72 1944

The Central Excise Act, Interest on differential 1944 duty paid in respect of 0.40 supplementary invoices

The Central Excise Act, Disallowance of Cenvat 1944 Credit on Shrink Films 72.65

The Central Excise Act, Disallowance of Cenvat 1944 Credit on Shrink Films 9.11

The Central Excise Act, Disallowance of Cenvat 1944 Credit on Shrink Films / 4.35 Shrink Sleeves

The Central Excise Act, Disallowance of Cenvat 1944 Credit on Shrink Films / 4.27 Shrink Sleeves

The Central Excise Act, Penalty 7.50 1944

The Central Excise Act, Excise Duty 61.95 1944 Penalty 61.95 Interest 81.47

The Central Excise Act, Disallowance of Cenvat 1944 Credit on Shrink Films/ 0.42 Sleeves

The Central Excise Act, Disallowance of Cenvat 1944 Credit on the supply of 5.00 pet chips

The Central Excise Act, Service Tax demand on 1944 transportation -Abatement 0.04 not allowed

The Sales Tax Act Sales tax in respect of 32.48 exempted sales

The Central Excise Act, Disallowance of CENVAT 1944 Credit on Shrink Films/ 0.10 Shrink Sleeves

The Central Excise Act, Disallowance of CENVAT 1944 Credit on Shrink Films/ 0.33 Shrink Sleeves

The Central Excise Act, Disallowance of CENVAT 1944 Credit on Shrink Films/ 2.56 Shrink Sleeves

The Sales Tax Act Assessment order passed 9.61

The Sales Tax Act Exemption given for business expansion under 19.77 FAVC is not supported by ''C'' Forms

Total 814.75

Name of the Statute Period to which Forum where the dispute is the amount pending relates

Income Tax Assessment year 2010-11 CIT(A)-Delhi Circle 14(I)

The Central Excise Act, March 1997 to Supreme Court of India 1944 June 1997 The Central Excise Act, March 1997 to Supreme Court of India 1944 December 2001

The Central Excise Act, January 2001 Central Excise and 1944 to April 2003 Service Tax Appellate Tribunal The Central Excise Act, August 2001 to Commissioner of 1944 February 2006 Central Excise, Raigad

The Central Excise Act, March 2006 to Assistant Commissioner of 1944 February 2007 Central Excise, CBD Belapur

The Central Excise Act, March 2007 to Assistant Commissioner of 1944 January 2008 Central Excise, CBD Belapur The Central Excise Act, February 2008 to Assistant Commissioner of 1944 December 2008 Central Excise, CBD Belapur The Central Excise Act, 2004-05 CESTAT Delhi. 1944

The Central Excise Act, 2002-03 CESTAT Delhi 1944

The Central Excise Act, February 2009 to Assistant Commissioner of 1944 December 2009 Central Excise, CBD Belapur The Central Excise Act, July 2004 to Commissioner of Customs & 1944 August 2004 Central Excise (Appeals), Mumbai III The Central Excise Act, January 2005 to Assistant Commissioner of 1944 March 2005 Central Excise, CBD Belapur The Sales Tax Act 2002-03 & Sales tax Appellate 2003-04 Tribunal, Haryana. The Central Excise Act, January 2010 to Assistant Commissioner of 1944 December 2010 Central Excise, CBD Belapur The Central Excise Act, January 2011 to Assistant Commissioner of 1944 October 2011 Central Excise, CBD Belapur The Central Excise Act, November 2011 to Assistant Commissioner of 1944 September 2012 Central Excise, CBD Belapur The Sales Tax Act 2009-10 Assistant Commissioner of Sales Tax

The Sales Tax Act 2002-03 Dt. Commissioner of Commercial Taxes, Bangalore 10. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders.

12. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund /nidhi / mutual benefit fund / society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the Company.

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

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

16. The Company has not raised new term loans during the year. The term loans outstanding at the beginning of the year have been applied for the purposes for which they were raised.

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

18. The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures during the year

20. The Company has not raised any money by way of public issues during the year.

21. In our opinion and 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.

For Sehgal Mehta & Co. Chartered Accountants F.R.N. No. 03330N NARESH KHANNA Partner M.No: 081482 Place: New Delhi Dated: 26.05.2014

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Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying Financial Statements of Pearl Polymers Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, the Statement of Profit and Loss and Cash Flow Statement for the Year Ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these Financial Statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principle generally accepted in India including Accounting Standards referred to in Section 211(3C) of the Companies Act,1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these Financial Statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Financial Statements are free from material misstatements. 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 aforesaid Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

c. The Balance Sheet, 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 Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in section 211(3C) of the Act;

e. On the basis of the written representations received from the Directors as on March 31, 2013, 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 Section 274(1)(g) 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.

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b) As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

c) In our opinion, the going concern status of the Company is not affected though the company has disposed off one of the industrial undertaking at Gurgaon and also sold some machines which are technologically outdated.

2. In respect of its inventories:

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

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

c) The discrepancies between the physical stock and book stock have been adjusted in the books.

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

a) In our opinion and according to information given to us, the Company has not granted any loan secured or unsecured to Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly provisions of paragraphs 4(iii)(b) to 4(iii)(d) of the Order are not applicable.

b) In our opinion and according to information given to us, the Company has taken unsecured loans with/without interest from five parties covered in the register maintained under Section 301 of the Companies Act, 1956 aggregating to Rs 194.5 Lacs. The loans have not been fully repaid during the year to the parties covered u/s 301 of the Companies Act, 1956. The balance as on the close of the year was Rs 97.18 lacs in respect of loans (with/without interest).

c) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and conditions on which fixed deposit and loan have been taken from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are not prima facie prejudicial to the interest of the Company.

d) In respect of the fixed deposit and loan taken, the Company is repaying the principal amount and paying the interest as stipulated.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

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

(a) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements that need to be entered in the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 exceeding the value of Rupees Five Lakhs or more in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

6. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 58A, 58AA or any other relevant provisions of Act, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As per the information and explanations given to us, no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the Company in respect of deposits accepted.

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

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete. 9. In respect of statutory dues:

a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-Tax, Sales Tax, W ealth Tax, Service Tax, Customs Duty, Excise Duty, Cess, and other statutory dues have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at March 31, 2013 for a period of more than six months from the date of becoming payable. There are no amounts due & outstanding for the period exceeding 6 months as at March 31, 2013 to be credited to Investor Education & Protection Fund.

b) The disputed statutory dues that have not been deposited on account of disputed matters pending before appropriate authorities are as under:

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

11. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to Financial Institutions, Banks and Debenture holders.

12. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund /nidhi / mutual benefit fund / society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the Company.

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

15. According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from Banks or Financial Institutions during the year.

16. The Company has raised new term loans during the year. The term loans outstanding at the beginning of the year and those raised during the year have been applied for the purposes for which they were raised.

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

18. The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures during the year.

20. The Company has not raised any monies by way of public issues during the year.

21. In our opinion and 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.

For Sehgal Mehta & Co.

Chartered Accountants

F.R.N. No. 003330N

NARESH KHANNA

Place : Nethw Delhi Partner

Dated: 30 May, 2013 M.No 081482

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Mar 31, 2012

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

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

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

Further to our comments in the Annexure referred to in above paragraph, 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 the books.

c) The audit reports of Mahad, Jigani and Lucknow branches conducted by the branch auditors have been forwarded to us and have been considered in preparing our report.

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

e) Read with Note No. 40 to 43 regarding related party disclosures being identified and certified by the management, in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act.

f) On the basis of the written representations received from the Directors as on 31st March 2012 and taken on record by the company, we report that none of the Director is disqualified as on 31st March 2012 from being appointed as a Director under Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

g) Without qualifying our opinion, we invite attention to Note No. 49 stating that the Company has investments of Rs. 545.40 Lacs in equity shares of Pearl Engineering Polymers Limited, a company under the same management u/s 370 (IB) of Companies Act, 1956, which is temporarily shut sown since March, 2011. No provision has been made for diminution of the value of the said investment as in the opinion of the management, the enterprise value is much higher, and the going concern of the company is not impacted at this stage.

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

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

ii) In the case of Statement of Profit and Loss, of the loss 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 ON THE ACCOUNTS OF PEARL POLYMERS LIMITED FOR THE YEAR ENDED 31ST MARCH, 2012 AS REFERRED TO IN OUR REPORT OF EVEN DATE.

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

(b) The fixed assets have been physically verified by the management during the year as per a phased programme which, in our opinion, is reasonable having regard to the size of the company and the nature of its business. No material discrepancies between the book records and physical verification were noticed.

(c) The Company has not disposed off substantial part of fixed assets during the year and hence the going concern status of the company is not affected.

(ii) (a) The inventories other than in transit and lying with third parties have been physically verified by the management at reasonable intervals during the year. In respect of inventories lying with third parties, these have substantially been confirmed by them. In our opinion the frequency of verification is reasonable.

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

(c) In our opinion and according to information and explanations given to us, the Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account.

(iii) (a) In our opinion and according to information given to us, the company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly provisions of paragraphs 4(iii)(b) to 4(iii)(d) of the Order are not applicable.

(b) In our opinion and according to information given to us, the Company has taken interest free unsecured loan from one party covered in the register maintained under Section 301 of the Companies Act, 1956 aggregating to Rs.. 25 Lacs. The Fixed Deposit along with interest free loan have been fully repaid during the year to the parties covered u/s 301 of the Companies Act, 1956. The maximum amount of fixed deposit and loan outstanding during the year was Rs.. 98 Lacs and Rs..50.87 Lacs respectively. The year end balance was Rs. NiL both in respect of fixed deposits and loans .

(c) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and conditions on which fixed deposit and loan have been taken from the parties covered in the register maintained under section 301 of the Companies Act, 1956 are not prima facie prejudicial to the interest of the company.

(d) In respect of the fixed deposit and loan taken, the company is repaying the principal amount and paying the interest as stipulated.

(iv) In our opinion and according to the information and explanations 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, fixed assets and for the sale 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, we are of the opinion that the particulars of contracts or arrangements that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 exceeding the value of Rupees Five Lakhs or more in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for transactions of purchase of goods where in the absence of similar contract with other parties, we are unable to comment whether the transactions were made at prevailing market price at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of Section 58A, 58AA or any other relevant provisions of Act, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As per the information and explanations given to us, no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the Company in respect of deposits accepted.

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

(viii) We have been informed by the management that maintenance of cost record is applicable as per Cost Accounting Records Rules, 2011 prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956. The management has also informed that the maintenance of such cost record is in process.

(ix) (a) According to the information and explanations given to us, the Company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee's State Insurance, Income-tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues with the appropriate authorities as per its records. There were no undisputed dues that were outstanding as at 31st March 2012 for a period of more than six months from the date they became payable. (b) As per the information and explanations given to us, there is no case where Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, and Cess have not been deposited on account of dispute except as stated hereunder:

Name of the Statute Nature of the Dues Amount (Rs.In ’Lakhs)

Income Tax Assessment u/s 143(3) 16.76

The Central Excise Act, Producing and clearing dutiable and non- 360.59 1944 dutiable product under Notification No.4/97

The Central Excise Act, Excise duty on freight 72.72 1944

The Central Excise Act, Interest on differential duty paid in respect 0.40 1944 of supplementary invoices

The Central Excise Act, Disallowance of Cenvat Credit on Shrink 72.65 1944 Films

The Central Excise Act, Disallowance of Cenvat Credit on Shrink 9.11 1944 Films

The Central Excise Act, Disallowance of Cenvat Credit on Shrink 4.35 1944 Films/Shrink Sleevs

The Central Excise Act, Disallowance of Cenvat Credit on Shrink 4.27 1944 Films/Shrink Sleevs

The Central Excise Act, Penalty 7.50 1944

The Central Excise Act, Excise Duty 61.95 1944 Penalty 61.95 Interest 73.42

The Central Excise Act, Disallowance of Cenvat Credit on Shrink 0.42 1944 Films/Shrink Sleeves

The Central Excise Act, Disallowance of Cenvat Credit on the 5.00 1944 supply of pet chips

The Central Excise Act, Service Tax demand on transportation 0.04 1944 Abatement not allowed

The Sales Tax Act Sales tax in respect of exempted sales 41.37

The Central Excise Act, Disallowance of CENVAT Credit on Shrink 0.10 1944 Films/Shrink Sleeves

The Central Excise Act, Disallowance of CENVAT Credit on Shrink 0.33 1944 Films/Shrink Sleeves

Total 792.93



Name of the Statue Period to which the amount Forum where the dispute is relates pending

Income Tax Assessment year 2009-10 CIT(A)-Delhi Circle 14 (1)

The Central Excise Act, 1944 March 1997 to June 1997 Central Excise and Service Tax Appellate Tribunal

The Central Excise Act, 1944 March 1997 to December 2001 Supreme Court of India

The Central Excise Act, 1944 January 2001 to April 2003 Central Excise and Service Tax Appellate Tribunal

The Central Excise Act, 1944 August 2001 to February 2006 Commissioner of Central Excise,Raigad

The Central Excise Act, 1944 March 2006 to February 2007 Assistant Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 March 2007 to January 2008 Assistant Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 February 2008 to December Assistant Commissioner of Central 2008 Excise, CBD Belapur

The Central Excise Act, 1944 2004-05 CESTAT Delhi.

The Central Excise Act, 1944 2002-03 CESTAT Delhi.

The Central Excise Act, 1944 February 2009 to December 2009 Assistant Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 July 2004 to August 2004 Commissioner of Customs & Central Excise (Appeals), Mumbai III

The Central Excise Act, 1944 January 2005 to March 2005 Assistant Commissioner of Central Excise, CBD Belapur

The Sales Tax Act 2002-03 & 2003-04 Sales tax Appellate Tribunal, Haryana.

The Central Excise Act, 1944 January 2010 to December 2010 Assistant Commissioner of Central Excise, CBD Belapur

The Central Excise Act, 1944 January 2011 to October 2011 Assistant Commissioner of Central Excise, CBD Belapur

(x) According to the records of the Company, the company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses in the financial year under report and the immediately preceding financial year.

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institution, banks or debenture holders.

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

(xiii) In our opinion and according to the information and explanations given to us, the provisions of any special statute applicable to chit fund, nidhi, mutual benefit fund, societies are not applicable to the company.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

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

(xvi) In our opinion and according to the information and explanations given to us, on an overall basis, term loans have been applied for the purposes for which they were obtained.

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

(xviii) During the year, the company has made preferential allotment of shares by way of allotment of Preference Shares to a party covered in the register maintained under section 301 of the Companies Act, 1956 aggregating to Rs.963 Lakhs. The price at which the shares have been issued is not prejudicial to the interest of the Company..

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

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

(xxi) During the course of our examination of the books of accounts and records carried out in accordance with the generally accepted auditing practice and accordingly to the information and explanation given to us, no fraud on or by the company has been noticed or reported during the year nor we have been informed of any such case by the management.

For J.C.Bhalla & Co

Chartered Acountants (FRN. 001111N) AKHIL BHALLA

Place : New Delhi Partner

Dated : 30th May, 2012 Membership No. 505002

---

Mar 31, 2011

We have audited the attached Balance Sheet of Pearl Polymers Limited as at 31st March, 2011 and also the Profit & Loss Account and Cash Flow Statement for the year ended on that date annexed thereto.These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

Further to our comments in the Annexure referred to in above paragraph, 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 the books.

c) The audit reports of Mahad, Jigani and Lucknow branches conducted by the branch auditors have been forwarded to us and have been considered in preparing our report.

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

e) Read with Note 17 on Schedule 18 regarding related party disclosures being identified and certified by the management, in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act.

f ) On the basis of the written representations received from the Directors as on March 31, 2011 and taken on record by the Company, we report that none of the Directors is disqualified as on 31st March 2011 from being appointed as a Director under Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

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

i) In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2011;

ii) In the case of Profit and Loss Account, of the profit for the year ended on that date; and

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

Annexure to the Auditor's Report on the accounts of Pearl Polymers Limited for the year ended 31st March, 2011 as referred to in our report of even date.

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

(b) The fixed assets have been physically verified by the management during the year as per a phased programme which, in our opinion, is reasonable having regard to the size of the company and the nature of its business. No material discrepancies between the book records and physical verification were noticed.

(c) The Company has not disposed off substantial part of fixed assets during the year and hence the going concern status of the Company is not affected.

(ii) (a) The inventories other than in transit and lying with third parties have been physically verified by the management at reasonable intervals during the year. In respect of inventories lying with third parties, these have substantially been confirmed by them. In our opinion the frequency of verification is reasonable.

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

(c) In our opinion and according to information and explanations given to us, the Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account.

(iii) (a) In our opinion and according to information given to us, the company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly provisions of paragraphs 4(iii)(b) to 4(iii)(d) of the Order are not applicable.

(b) In our opinion and according to information given to us, the Company has taken Fixed Deposit under public fixed deposit scheme of the Company from Five parties and an interest free loan from one party covered in the register maintained under Section 301 of the Act aggregating to Rs.135 lakhs and Rs.70 lakhs during the year respectively. The maximum amount of fixed deposit and loan outstanding during the year was Rs.24,896 (thousand) and Rs.5,000 (thousand) respectively. The year end balance was Rs.9,800 (thousand) in respect of fixed deposits and Rs.2,587 (thousand) in the case of loan.

(c) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and conditions on which fixed deposit and Loan have been taken from the parties covered in the register maintained under Section 301 of the Companies Act,1956 are not prima facie prejudicial to the interest of the company.

(d) In respect of the fixed deposit and loan taken, the company is repaying the principal amount and paying the interest as stipulated.

(iv) In our opinion and according to the information and explanations 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, fixed assets and for the sale 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, we are of the opinion that the particulars of contracts or arrangements that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 exceeding the value of Rupees Five Lakhs or more in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for transactions of purchase of goods where in the absence of similar contract with other parties, we are unable to comment whether the transactions were mede at prevailing market price at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of Section 58A, 58AA or any other relevant provisions of Act, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As per the information and explanations given to us, no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the Company in respect of deposits accepted.

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

(viii) In our opinion and according to the information and explanations given to us, the maintainence of cost records has not been prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956.

(ix) (a) According to the information and explanations given to us, the Company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employee's State Insurance, Income-tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues with the appropriate authorities as per its records. There were no undisputed dues that were outstanding as at March 31, 2011 for a period of more than six months from the date they became payable.

(b) As per the information and explanations given to us, there is no case where Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess have not been deposited on account of dispute except as stated hereunder:

Name of the Statute Nature of the Dues Amount (Rs. in ('000)

The Central Excise Producing and clearing 36,059 Act,1944 dutiable and non-dutiable product under Notification No.4/97

The Central Excise Excise duty on freight 7,272 Act, 1944

The Central Excise Interest on differential 40 Act, 1944 duty paid in respect of supplementary invoices.

The Central Excise Disallowance of Cenvat 7,265 Act, 1944 Credit on Shrink Films

The Central Excise Disallowance of Cenvat 911 Act, 1944 Credit on Shrink Films

The Central Excise Disallowance of Cenvat 435 Act, 1944 Credit on Shrink Films / Shrink Sleeves

The Central Excise Disallowance of Cenvat 427 Act, 1944 Credit on Shrink Films / Shrink Sleeves

The Central Excise Penalty 750 Act,1944

The Central Excise Excise Duty 6,195 Act, 1944 Penalty 6,195 Interest 6,536

The Central Excise Disallowance of Cenvat 42 Act, 1944 Credit on Shrink Films / Shrink Sleeves

The Central Excise Disallowance of Cenvat 500 Act, 1944 Credit on the Supply of Pet Chips

The Central Excise Service Tax Demand on 4 Act, 1944 Transportation Abatement not allowed

The Sales Tax Act Sales Tax in respect of 5,377 exempted sales

Total 78,008

Name of the Statute Period to Forum where which the the dispute amount is pending relates

The Central Excise March 1997 to Central Excise and Act, 1944 June 1997 Service Tax Appellate Tribunal

The Central Excise March 1997 to Supreme Court of India Act, 1944 December 2001

The Central Excise January 2001 to Central Excise and Act, 1944 April 2003 Service Tax Appellate Tribunal

The Central Excise August 2001 to Commissioner of Central Act, 1944 February 2006 Excise, Raigad

The Central Excise March 2006 to Assistant Commissioner of Act, 1944 February 2007 Central Excise, CBD Belapur

The Central Excise March 2007 to - do - Act, 1944 January 2008

The Central Excise February 2008 to - do - Act, 1944 December 2008

The Central Excise 2004-05 CESAT Delhi Act, 1944

The Central Excise 2002-03 - do - Act, 1944

The Central Excise February 2009 to Assistant Commissioner of Act, 1944 December 2009 Central Excise, CBD Belapur

The Central Excise July 2004 to Commissioner of Customs Act, 1944 August 2004 & Central Excise (Appeals) Mumbai III

The Central Excise Jan 2005 to Assistant Commissioner of Act, 1944 March 2005 Central Excise, CBD Belapur

The Sales Tax Act 2002-2003 & Sales tax Appellate 2003-04 Tribunal,Haryana

(x) According to the records of the Company, the Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses in the financial year under report and the immediately preceding financial year.

(xi) According to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institution, banks or debenture holders.

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

(xiii) In our opinion and according to the information and explanations given to us, the provisions of any special statute applicable to chit fund, nidhi, mutual benefit fund, societies are not applicable to the Company.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

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

(xvi) In our opinion and according to the information and explanations given to us, on an overall basis, term loans have been applied for the purposes for which they were obtained.

(xvii) According to the information and explanations given to us and on the basis of overall examination of the Balance Sheet of the company we are of the opinion that the company has utilized funds aggregating to Rs.22,209 (thousand) raised on short term basis by way of working capital loan from Bank and/or reduction in net current assets for acquiring fixed assets during the year.

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

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

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

(xxi) During the course of our examination of the books of accounts and records carried out in accordance with the generally accepted auditing practice and according to the information and explanation given to us, no fraud on or by the Company has been noticed or reported during the year nor have we been informed of any such case by the management.

Anil Bhalla Partner Membership No.11367 For and on behalf of J.C. Bhalla & Co. Chartered Accountants (FRN 001111N)

Place : New Delhi Dated : 30th May, 2011

---

Mar 31, 2010

We have audited the attached Balance Sheet of Pearl Polymers Limited as at March 31, 2010 and also the Profit & Loss Account and Cash Flow Statement for the year ended on that date annexed thereto.These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting, the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. W e believe that our audit provides a reasonable basis for our opinion.

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

Further to our comments in the Annexure referred to in above paragraph, 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 the books.

c) The audit reports of Mahad, Jigani and Lucknow branches conducted by the branch auditors have been forwarded to us and have been considered in preparing our report.

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

e) Read with Note 17 on Schedule 18 regarding related party disclosures being identified and certified by the management, in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act.

f ) On the basis of the written representations received from the Directors as on March 31, 2010 and taken on record by the Company, we report that none of the Directors is disqualified as on 31st March 2010 from being appointed as a Director under Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956. g) In our opinion and to the best of our information and according to the explanations given to us the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i) In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2010;

ii) In the case of Profit and Loss Account, of the profit for the year ended on that date; and

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

Annexure to the Auditors Report on the accounts of Pearl Polymers Limited for the year ended 31st March, 2010 as referred to in our report of even date.

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

(b) The fixed assets have been physically verified by the management during the year as per a phased programme which, in our opinion, is reasonable having regard to the size of the company and the nature of its Business. No material discrepancies between the book records and physical verification were noticed.

(c) The Company has not disposed off substantial part of fixed assets during the year and hence the going concern

status of the Company is not affected. (ii) (a) The inventories other than in transit and lying with third parties have been physically verified by the management at reasonable intervals during the year. In respect of inventories lying with third parties, these have substantially been confirmed by them. In our opinion the frequency of verification is reasonable.

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

(c) In our opinion and according to information and explanations given to us, the Company is maintaining proper records of inventories. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account.

(iii) (a) In our opinion and according to information given to us, the company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly provisions of paragraphs 4(iii)(b) to 4(iii)(d) of the Order are not applicable.

(b) In our opinion and according to information given to us, the Company has taken Fixed Deposit under public fixed deposit scheme of the Company from Six parties and an interest free loan from One party covered in the register maintained under Section 301 of the Act. The maximum amount of fixed deposit and loan outstanding during the year was Rs.11396 (thousand) and Rs. 1000 (thousand) respectively. The year end balance was Rs.11396 (thousand) in respect of fixed deposits and Nil in the case of loan.

(c) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and conditions on which fixed deposit and Loan have been taken from the parties covered in the register maintained under Section 301 of the Companies Act,1956 are not prima facie prejudicial to the interest of the company.

(d) In respect of the fixed deposit and Loan taken, the company is repaying the principal amount and paying the interest as stipulated.

(iv) In our opinion and according to the information and

explanations 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 and services. Further, in our opinion, there is no continuing failure to correct major weaknesses in internal control system of the Company.

(v) (a) In our opinion and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 exceeding the value of Rupees Five Lakhs or more in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for transactions of uniqu and specialized nature where in the absence of similar contract with other parties, we are unable to comment whether the transactions were mede at prevailing market price at the relevant time.

(vi) In our opinion and according to the information and

explanations given to us, the company has complied with the provisions of Section 58A, 58AA or any other relevant provisions of Act, and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As per the information and explanations given to us, no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the Company in respect of deposits accepted.

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

(viii) In our opinion and according to the information and explanations given to us, the maintenance of cost records has not been prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956.

(ix) (a) According to the information and explanations given to us, the Company has generally been regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues with the appropriate authorities as per its records. There were no undisputed dues that were outstanding as at March 31, 2010 for a period of more than six months from the date they became payable.

(b) As per the information and explanations given to us, there is no case where Sales Tax, Income Tax, Wealth Tax, taken by others from banks or financial institutions during the year.

(xvi) According to the information and explanations given to us, on an overall basis, term loans have been applied for the purposes for which they were obtained.

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

(xviii) During the year, the Company has not made any preferential allotment of shares to parties and companies

Name of the Statute Nature of the Dues Amount (Rs. in (000)

The Central Excise Producing and clearing dutiable 36,059 Act,1944 and non-dutiable product under Notification No.4/97

The Central Excise Excise duty on freight 7,272 Act, 1944

The Central Excise Interest on differential duty paid 40 Act, 1944 in respect of supplementary invoices.

The Central Excise Disallowance of Cenvat Credit on 7,265 Act, 1944 Shrink Films

The Central Excise Disallowance of Cenvat Credit on 911 Act, 1944 Shrink Films

The Central Excise Disallowance of Cenvat Credit on 435 Act, 1944 Shrink Films / Shrink Sleeves

The Central Excise Disallowance of Cenvat Credit on 427 Act, 1944 Shrink Films / Shrink Sleeves

The Central Excise Penalty 750 Act, 1944

The Central Excise Excise Duty 6,195

Act, 1944 Penalty 6,195

Interest 5,731

The Central Excise Disallowance of Cenvat Credit on 42 Act, 1944 Shrink Films / Shrink Sleeves

The Central Excise Disallowance of Cenvat Credit on 500 Act, 1944 Supply of Pet Chips

he Central Excise Service Tax Demand on 4 Act, 1944 Transportation Abatement not allowed

The Sales Tax Act Sales Tax in respect of 5,377 Exempted sales

Total 77,203



Name of the Statute Period to which the Forum where the dispute amount relates is pending

The Central Excise March 1997 to Central Excise and Act,1944 June 1997 Service Tax Appellate Tribunal

The Central Excise March 1997 to Supreme Court of India Act, 1944 December 2001

The Central Excise January 2001 to Central Excise and Act,1944 April 2003 Service Tax Appellate Tribunal

The Central Excise August 2001 to Commissioner of Central Act,1944 February 2006 Excise, Raigad

The Central Excise March 2006 to Assistant Commissioner of Act,1944 February 2007 Central Excise, CBD Belapur

The Central Excise March 2007 to - do - Act,1944 January 2008

The Central Excise February 2008 to - do - Act,1944 December 2008 The Central Excise 2004-05 CESAT Delhi Act,1944

The Central Excise 2002-03 - do - Act,1944

The Central Excise February 2009 to Assistant Commissioner of Act,1944 December 2009 Central Excise, CBD Belapur

The Central Excise July 2004 to Commissioner of Customs Act,1944 August 2004 & Central Excise (Appeals) Mumbai III

he Central Excise Jan 2005 to Assistant Commissioner of Act,1944 March 2005 Central Excise, CBD Belapur

The Sales Tax Act 2002-2003 & 2003-04 Sales tax Appellate Tribunal, Haryana



Service Tax, Custom Duty, Excise Duty, Cess have not been deposited on account of dispute except as stated hereunder:

(x) According to the records of the Company, the Company

does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses in the financial year under report and the immediately preceding financial year.

(xi) According to the information and explanations given to

us, the Company has not defaulted in repayment of dues to financial institution, banks or debenture holders.

(xii) According to the information and explanations given to

us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and

explanations given to us, the provisions of any special statute applicable to chit fund, nidhi, mutual benefit fund, societies are not applicable to the Company.

(xiv) According to the information and explanations given to

us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loans covered in the register maintained under Section 301 of the Companies Act,1956.

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

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

(xxi) During the course of our examination of the books of accounts and records carried out in accordance with the generally accepted auditing practice and according to the information and explanation given to us, no fraud on or by the Company has been noticed or reported during the year nor have we been informed of any such case by the management.



Anil Bhalla

Partner

Membership No.11367

For and on behalf of

Place : New Delhi J.C. Bhalla & Co.

Dated : 29th May, 2010 Chartered Accountants

(FRN 001111N)

---

Mar 31, 2009

We have audited the attached Balance Sheet of Pearl Polymers Limited as at March 31 2009 and also the Profit & Loss Account and Cash Flow Statement for the year ended on that date annexed theretoThese financial statements are the responsibility of the Companys management Our responsibility is to express an opinion on these financial statements based on our audit We conducted our audit in accordance with 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 auditincludes examining on a test basis evidence supporting the amounts and disclosures in the financial statements An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation We believe that our audit provides a reasonable basis for our opinion

As required by the Companies (AuditorsReport) Order 2003 issued by the Central Government in terms of section 227(4A) of the Companies Act 1956 on the basis of such checks as we considered appropriate we enclose in the Annexure a statement on the matters specified in paragraph 4 and 5 of the said order to the extent applicable Further to our commentsin the Annexure referred to in above paragraph 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 fronvour examination of the books

c) The audit reports of Mahad Jigani and Lucknow branches conducted by the branch auditors have been forwarded to us and have been considered in preparing our report

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

e) Read with Note 17 on Schedule 18 regarding related party disclosures being identified and certified by the management in our opinion the Balance Sheet Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act

f) On the basis of the written representations received from the Directors we report that none of the Directors are disqualified as on 31 ST March 2009 from being appointed as a Director under

Clause (g) of sub-section (1) of Section 274 of the Companies Act 1956

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

i) In the case of the Balance Sheet of the state of affairs of the company as at 31st March2009;

ii) In the case of Profit and Loss Account of the profit for the year ended on that date; and

iii) In the case of the Cash flow statement of the cash flows tor the year ended on that date

Annexure to the Auditors Report on the accounts of Pearl Polymers Limited for the year ended 31st March 2009 as referred to In our report of even date

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

(b) The fixed assets have been physically verified by the management during the year as per a phased programme which in our opinion is- reasonable having regard to the size of the company and the nature of its assets No material discrepancies were noticed on such verification

(c) The Company has not disposed off substantial part of fixed assets during the year and hence the going concern status is not affected

(ii) (a) The inventories other than in transit and lying with third parties have been physically verified by the management at reasonable intervals during the year In respect of inventories lying with third parties; these have substantially been confirmed by them In our opinion the frequency of verification is reasonable

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

(c) In our opinion and according to information and explanations given tous the Company is maintaining proper records bf inventories The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account

(iii) (a) In our opinion and according to information given to us the company has not granted any loan secured or unsecuredto companies firms or other parties covered in the register maintained under Section 301 of the Companies Act 1956 Accordingly provisions of clause 4(iii)(b) to 4(lii)(d)Of the Order are not applicable

(b) In our opinion and according to information given to us the Company has taken Fixed Deposit under public fixed deposit scheme of the Company from Five parties covered in the register maintained under Section 301 of the Act The maximum amount of fixed deposit outstanding during the year was Rs12996 (thousand) The year end balance of fixed deposit was Rs10396 (thousand) in respect of five parties

(c) In our opinion and according to the information and explanation given to us the rate of interest and other terms and conditions on which fixed deposit have been taken from theparties covered in the register maintained under Section 301 of the Companies Act 1956 are not prima facie prejudicial to the interest of the company

(d) In respect of the fixed deposit taken the company is repaying the principal amount and paying the interest as stipulated

(iv) In our opinion and according tothe information and explanations 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 and services Further in our opinion there is no continuing failure to correct major weaknesses in internal control system

(v) (a) In our opinion and according to the information and explanations given to us we are of the opinion that the transactions that need to be entered in the register maintained under section 301 of the Companies Act 1956 have been so entered -(b) In our opinion and according to the information and explanations given to us the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act 1956 exceeding the value of Rupees Five Lakhs or more inrespect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time

(vi) In our opinion and according to the information and explanations given to us the company has complied with the provisions of Section 58A 58AA or any other relevant provisions of Act and the Companies (Acceptance of Deposits) Rules 1975 with regard to the deposits accepted from the public As per the information and explanations given to us no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the Company in respect of deposits accepted

(vii) Inour opinion the internal audit system of the company is commensurate with the size and nature of its business

(viii) In our opinion and according to the information and explanations given to us the maintenance of cost records has not been prescribed by the Central Government under section 209(1)(d) of the Companies Act 1956;

(ix) (a) According to the information and explanations given to us the Company has generally been regular in depositing undisputed statutory dues including Provident Fund Investor Education and Protection Fund Employees State

Insurance Income-tax Sales Tax Service Tax Custom Duty Excise Duty Cess and any other material statutory dues with the appropriate authorities as per its records There were no undisputed dues that were outstanding as - at March 31 2009 for a period of more than six months from the date they became payable (b) As per the information and explanations given to us there is no case where Sales Tax Income Tax Wealth Tax Service Tax Custom Duty Excise Duty Cess have not been deposited on account of dispute except as stated hereunder:

(xvi) According to the information and explanations given to us on an overall basis term loans have been applied for the purposes for which they were obtained

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

(xviii) During the year the Company has made preferential allotment of shares by way of allotment of Preference

Name of the Statute Nature of the Dues Amount (Rs in (000)

The Central Excise Producing arid clearing dutiable 36,000 Act 1944 and non-dutiable product under Notification No4/97

The Central Excise Excise duty on freight 7,272 Act 1944

The Central Excise Interest on differential duty paid 40 Act 1944 in respect of supplementary invoices

The Central Excise Disallowance of Cenvat Credit on 7,265 Act 1944 Shrink Films

The Central Excise Disallowance of Cenvat Credit on 911 Act 1944 Shrink Films

The Central Excise Disallowance of Cenvat Credit on 14 Act 1944 Pet Chips

The Central Excise Disallowance of Cenvat Credit on 435 Act 1944 Shrink Films / Shrink Sleeves

The Central Excise Disallowance of Cenvat Credit on 427 Act 1944 Shrink Films / Shrink Sleeves

The Central Excise Penalty 750 Act 1944

The Central Excise Excise Duty 6,195 Act 1944 Penalty 6,195 Interest 4926

The Sales Tax Act Sales tax in respect of exempted 5,377 sales

The Sales Tax Act Sales Tax Demand 899

The Sales Tax Act Sales Tax Demand 3,389

Total 80,095



Name of the Statue Period to which the Forum where the dispute amount relates is pending

The Central Excise March 1997 to Central Excise and Act,1944 June 1997 Service Tax Appellate Tribunal

The Central Excise April 1997 to - do - Act,1944 December 2001

The Central Excise January 2001 to - do - Act, 1944 April 2003

The Central Excise August 2001 to Commissioner of Central Act, 1944 February 2006 Excise Raigad

The Central Excise March 2006 to Assistant Commissioner of Act, 1944 February 2007 Central Excise CBD Belapur

The Central Excise July 2004 to Joint Commissioner of Act, 1944 August 2005 Central Excise CBD Belapur

The Central Excise March 2007 to Assistant Commissioner of Act, 1944 January 2008 Central CBD Belapur

The Central Excise February 2008 to Assistant Commissioner of Act, 1944 December 2008 Central CBD Belapur

The Central Excise 2004-05 CESAT Delhi Act, 1944

The Central Excise 2002-03 -do-

The Sales Tax Act 2002-03 & 2003-04 Sales tax Appellate Tribunal Haryana

The Sales Tax Act 2000-2001 Assistant Commissioner of Sales Tax

The Sales Tax Act 2001-2002 Assistant Commissioner of Sales Tax

(x) According to the records of the Company the Company does not have accumulated losses at the end of the financial year The Company has not incurred cash losses in the financial year underreport and the immediately preceding financial year

(xi) According to the information and explanations given to us the Company has not defaulted in repayment of dues to financial institution banks or debenture holders

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

(xiii) In our opinion and according to the information and explanations given to us the provisions of any special statute applicable to chit fund nidhi mutual benefit fund societies are not applicable to the Company

(xiv) According to the information and explanations given to us the Company is not dealing or trading in shares securities debentures and other investments

(xv) According to the information and explanations given to us the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year

Shares to a party covered underSection 301 of the Companies Act 1956 aggregating to Rs:700 lakhsThe price at which the shares have been issued is not prejudicial to the interest of the company

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

(xx) The Company has not raised any money through a public - issue during the year

(xxi) During the course of our examination of the books of accounts and-records carried out in accordance with the generally accepted auditing practice and according to the information and explanation given to us no fraud on or by the Company has been noticed or reported during the year nor have we been informed of any such case by the management

Notes :

1 DEBENTURES:

Comprising 500000 (Previous Year-500000) 9% Secured Redeemable Non Convertible Debentures of Rs100/- each issued on private placement basis secured by Parri Passu charge on the immovable property of the Company situated at Gurgaon (Haryana) together with factory Building constructed/ to be constructed alongwith Plant & Machinery installed/to be installed The Debentures to the extent of 5% have been redeemed in four equal quarterly instalments commencing from 30th April 2005 The balance 95% are to be repaid in 19 equal quarterly instalments commencing from 30th April 2006 out of which Rs30000(00p) have been paid till 31st March 2009 (Due within One year Rs10000(000) Previous Year Rs10000(000))

2 WORKING CAPITAL LOANS

Working Capital Loans from Banks are secured by hypothecation of inventories and Book Debts and are further secured by first charge on Companys immovable property at Okhla and second charge on Companys immovable property at GurgaonThe above said loans are further secured by personal guarantee of MrChand Seth MrHarish Seth Directors of the Company and MrKrishen Seth

3 WORKING CAPITAL DEMAND LOANS

Working Capital Demand Loan from Financial Institutions is secured by Parri Passu mortgage/charge on immovable property of the Company situated at Mahad (Maharashtra) and Jigani (Kamataka) together with factory building constructed/to be constructed alongwith Plant & Machinery installed/to be installedThe above said loan is further secured by personal guarantees of Mr Chand Seth Mr Harish Seth Directors of the Company and Mr Krishen Seth (Due within One year Rs20000(000) Previous Year Rs15000(000))

4 TERM LOANS:

(a) Term loan of Rs19375(000) (Previous Year-Rs 29035(000) is secured by way of parri-passu charge on the immovable property situated at Mahad (Maharashtra) & Jigani(Karnataka) The same is further secured by way of legal mortgage on companys unit situated at Mahad (Maharashtra) The above said loan is further secured by personal guarantees of MrChand Seth Mr Harish Seth Directors of the Company and Mr Krishen Seth

(b) (i) Term Loans of Rs7960(000)(Previous Year-Rs11439{000) is secured by way of pari-passu charge on the immovable property situated at Companys unit at Mahad (Maharashtra) and Jigani (Karnataka) together with factory building constructed / to be constructed with plant & machinery installed / to be installedThe above said loan is further secured by personal guarantees of Mr Chand Seth Mr Harish Seth Directors of the Company and MrKrishen Seth

(ii) Term Loan of Rs85000(000) (Previous Year Rs 50000(000) is secured by a first mortgage /charge on immovable properties situated at companys unit at Pantnagar (Uttrakhand) and a Companys Flat at Banglore The abovesaid loan is further secured by personal guarantee of Mr Chand Seth and Mr Harish Seth Directors of the Company

(c) Term Loan of Rs314(000) (Previous Year -Rs 3314(000 ) is secured by way of pari-passu charge on the immovable property of the Company situated at Jigani (Karnataka) together with factory building constructed with plant & machinery installed/to be installed The above said loan is further secured by personal guarantees of Mr Chand Seth Mr Harish Seth Directors of the Company and Mr Krishen Seth

(d) Term Loan of Rs12829(000) (Previous Year-Rs15729(000) is secured by first pari-passu charge on the assets situated at the Companys unit situated at Gurgaon (Haryana) The above said loan is further secured by personal guarantees of Mr Chand Seth Mr Harish Seth Directors of the Company

(e) Term Loan of Rs21007(000) (Previous Year- Nil) is secured by first pari-passu charge on the assets situated at the Companys unit at Gurgaon (Haryana) The above said loan is further secured by personal guarantees of Mr Chand Seth and Mr Harish Seth Directors of the Company

(f) Term Loan of Rs32502(000) (Previous Year Rs37000(000) is secured by way of pari-passu first mortgage/charge created on all immovable and movable assets both present and future (save and except book debts) in respect of property situated at Baddi The above said loan is further secured by personal guarantees of Mr Chand Seth and Mr Harish Seth Directors of the Company

(g) Term Loan of Rs10500(000) (Previous Year Rs 12500(000) is secured by way of pari-passu first mortgage/charge created on all immovable and movable assets both present and future (save and except book debts) in respect of property situated at Baddi The above said loan is further secured by personal guarantees of Mr Chand Seth and Mr Harish Seth Directors of the Company

(Due within one year Rs 43813 (000) (Previous Year-Rs 25539 (000)

5 VEHICLE LOANS:

Vehicle loans from Banks secured against hypothecation of respective vehicles (Due within One Year Rs1576(000) Previous Year Rs1039(000))



Akhil Bhalla Partner Membership No505002 For and on behalf of Place : New Delhi JC Bhalla & Co Dated : 29th June 2009 Chartered Accountants