Gangotri Cement Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2014

Report on the Financial Statements

We have audited the accompanying financial statements of M/S GANGOTRI CEMENT LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information, which we have signed under reference to this report.

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 notified under ''the Companies Act, 1956'' of India (the "Act") read with the General Circular 15/ 2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013i This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) order, 2003 including companies (Auditors Report) (Amendment) order 2004 issued by the Central Government of India in terms of Sub-section (4A) of section 227 of the companies Act, 1956, we enclose in the Annexure a Statement on the matters specified in paragraphs 4 & 5 of the said 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 purposes of our audit.

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

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, subject to point no. 3 given below the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211of the companies Act, 1956 read with general circular 15/2013 dated 13 Spetember2013 of Ministry of Corporate Affairs in respect of section 133 of the Companies Act 2013 and

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

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

3. Attention of the members is drawn to the following Notes:-

a. Note No.26 of Notes on financial statements.

b. Note No.33 of Notes on financial statements regarding gratuity calculation. Effect of which could not Quantify.

c. Note No.34 of Notes on financial statements regarding certain disclosure relating to Micro / Small/ Medium Enterprises.

ANNEXURE TO THE AUDITORS''S REPORT REFERRED TO IN PARAGRAPH (1)

UNDER REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS'' SECTION OF OUR REPORT OF EVEN DATE OF M/S GANGOTRI CEMENT LTD

FOR THE YEAR ENDED ON 31-03-2014

I. a. The company has maintained proper records to show its full particulars including quantitative details and situation of fixed assets.

b. As explained to us, the fixed assets have been physical verified by the management with a phased programme over the year, which in our opinion is reasonable having regard to the size of the company and the nature of its assets. No serious discrepancies were noticed on such verification conducted during the year as compared with the books records.

c. The Company has not disposed off any fixed assets of the Company during the year under audit.

II. a. As explained to us, the inventory of the company has been physically verified in phased manner during the year by the management. In our opinion the frequency of verification is reasonable.

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

c. The Company is maintaining proper records of Inventory and no material discrepancies were noticed on physical verification of inventory as compared to books records.

III. a. According to the information and explanations given to us, during the period covered by audit report the Company has not given any unsecured loans to the Company covered in the register maintained under section 301 of the Company Act, 1956. Accordingly, the provisions of clause 4(iii) (b) to (d) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

b. According to the information and explanations given to us, during the period covered by audit report the Company has taken loans, secured or unsecured from companies, firms or other parties covered in the Registers maintained U/S 301 of the Companies Act 1956 (1 of 1956). Total Number of parties are 5 and amount involved (maximum amount involved) during the years Rs 172.63 Lakhs. During the year company has taken 55.00 Lacs and year-end balances were Rs. 149.56 lacs.

c. In our opinion the rate of interest and other terms and conditions on which loans have been taken from the other parties listed in the register maintained under section 301, of the companies act, 1956 are not, prima facie prejudicial to the interest of the company.

d. In our opinion & according to the information given to us there is no such stipulation up on the company regarding the payment of the loan taken from above party so the question related to regularity in payment of principal will not arise.

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 nature of its business, with regard to purchase of inventory and fixed assets and for sale of goods. During the course of our audit no major weaknesses has been noticed in the internal controls.

V. (a) In our opinion and according to the information and explanations given to us, there are transactions that need to be entered into the register made in pursuance of section 301 of the Act have been entered in the register so maintained.

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

VI. In our opinion and according to the information and explanations given to us the company has not accepted any deposits from public within the meaning of section 58 A & section 58AA of the Companies Act 1956

VII. The Company does not have a formal internal audit system. However, in our opinion, there are adequate internal control procedures commensurate with the size and nature of its business

VIII. We have broadly reviewed the books of accounts maintained by the company, in respect of products where pursuant to the rules made by the Central Government, about the maintenance of cost records has been prescribed under section 209 (1) (d) of the Companies Act 1956. We are in the opinion, that prima facie the prescribed books of accounts and records are not applicable to the company.

IX. a. The company generally is regular in depositing undisputed statutory dues including, income tax, VAT and other statutory dues with the appropriate authorities, except in certain cases where dues have been deposited after due date along with Interest charged thereon. However the following statutory undisputed dues have not been deposited:

S.No. Nature of Undisputed Statutory Dues Amount (in Rs) 1 | VAT 688601.45

b. According to the records of the company there are no dues of income-tax, Sales Tax, Service Tax, custom duty, wealth tax, excise duty / cess which have not been deposited on account of any dispute.

X. The Company accumulated losses at the end of the financial year are less than 50% of its net worth. However, it has not incurred cash losses during the financial year and immediately preceding financial year.

XI. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of the dues to a financial institution, banks during the year. There are no debenture holders in the Company.

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

XIII. The provision of special statute applicable to Chit Fund, Nidhi / Mutual benefit fund / Societies is not applicable to the company.

XIV. As per records of the company and the information and explanation given to us by the management, company is not dealing or trading in shares, securities and debentures and other investments.

XV According to the records of the company and according to the information and explanations given to us the Company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI The Company has neither raised any term loans during the year nor was any unutilized amount left on this account, as at the beginning of the year. Therefore, the provisions of Clause 4(xvi) of the Companies (Auditors Report) Order, 2003, are not applicable to the Company.

XVII. According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long term investment by the Company.

XVIII As per the records of the company and according to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the registered maintained under section 301 of the Act.

XIX The Company has not issued debentures; hence question of creation of securities does not arise.

XX. During the period covered by our audit report, the company has not raised any money by public issue.

XXI. To the best of our knowledge and belief and according to the information and explanation given to us, there is no fraud on or by the Company has been noticed during our audit or reported during the period.

FOR, SUNIL JOHRI & ASSOCIATES CHARTERED ACCOUNTANTS, FIRM REGN.NO.005960C

Place: Raipur Dated: 30/05/2014

SIMIT BANERJEE PARTNER M.NO.411114

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Mar 31, 2012

1. a) The company has maintained proper records to show its full particulars including quantitative details and station situation of fixed assets.

b) We are information that the Fixed Assets were physically verified at reasonable intervals during the year No serious discern penances were noticed on such verified

c) The Company has not disposed off any fixed assets of the Company during the year under audit.

II. a. As explained to us the inventory of the company has been physically verified during the by the management on quarterly basis. In our opinion the frequency of verification is reasonable.

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

c. The company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification of inventory as compared to books records.

III. a. The company has not granted any loans secured or unsecured to companies firms or other parties covered in the Registers maintained U/S 301 OF THE COMAPNIES acts 1956 (1 of 1956)

b. As reported in clause III a, Sub-clause b, b, d, are not applicable to company

e, The company has taken loans, sacred or unsecured from companies firms or other parties covered in the Registers maintained U/S 301 companies Act,1956 (1 of 1956 Total Number of parties is 7 and amount involved (maximum amount involved) during the year Rs.112.05 LAKHS during THE YEAR company has taken 119.50 Lacs and year-end balance was Rs.100.05 lacs.

f. In our opinion the rate of interest and other terms and conditions on which loans have been taken from the other parties listed in the register maintained under section 301, of the companies act 1956 are not prima facie prejudicial to the interest of the company.

g. In our opinion and according to the information and explanation a given to us in respect of paying principal and interest amount of unsecured loan the terms of repayment have not been stipulated therefore we have not made any comments

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 nature of its business, with regard to purchase of inventory and fixed assets and for sale of goods During the course of our audit no major weaknesses has been noticed in aLl for the internal controls.

V. (a) In our opinion and according to the information and explanations given to us the transaction that need to be entered into the register maintained under section 301 of the companies Act,1956 have not been occurred.

(b) In our opinion and having regard to our comments in para (v) above no transactions made in pursuance of contract or arrangements entered in the register maintained under section 301 of the companies Act, 1956 hence no comment called for in this regard.

VI In our opinion and according to the information and explanations given to us the company has not accepted any deposits from public within the meaning of section 58 A& 58 AA of the companies Act 1956.

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

VIII. We have broadly reviewed the books of accounts maintained by the company in respect of products where pursuant to the rules made by the Central Government, I respect of products where pun ant to the males section 209 (1) (d) of the companies Act 1956. We have in the opinion that prima facie die prescribed accounts and records have been made and maintained

IX a. The company is regular in depositing undisputed statutory dues including provident fund income tax excise duty service tax cess and other statutory dues with the appropriate authorities According to information and explanation given to us there is no undisputed arrers statutory dues as on last day of the financial year for a period of more than 6 months from the date they become payable.

X Company accumulated losses at the financial year is less than of fifty percentage of net worth company has not incurred cash losses during the financial year and immediately preceding financial year.

XI In our opinion and according to the information and explanation given to us the company has not defaulted in repayment of the dues to a financial institution banks.

XII According to the records of the company has not granted loans and advances on the basis of security by way of pledge of shares debentures and other securities.

XIII. The provision of special statute applicable to Chit Fund, Nidhi / Mutual benefit fund / Societies is not applicable to the company.

XIV As per records of the company and the information and explanation given to us by the management company is not dealing or trading in share securities and debentures and other investments.

XV According to the records of the company and according to the information and explanations given to us the company has not given any guarantee for loans taken by others from banks or financials institutions.

XVI The Company has enjoying Loan Facility from HDFC Bank. Tate Company has nosed the above loans for the purpose for which these are obtained.

XVII According to the information and explanations given to us and on an overall examination of the balance sheet of the company we report that no funds raised on short-term basis have been used for long term vestment by the Company.

XVIII As per the records of the company and according to the information and explanations given to us the company has not made any preferential allotment of shares to parties companies covered in the registered maintained under section 301 of the Act.

XIX The Company has not issued debentures; hence question of creation of securities does I not arise.

XX. During the period covered by our audit report, the company has not raised any money by public issue.

XXI To the best pure knowledge and belief and according to the information and explanation given to us there is no fraud on or by the company during our audit or reported during the period.

for SUNIL JOHRI & ASSOCIATES

CHARTERED ACCOUNTANT

FIRM REGN. N0.05960

Place: Raipur

Dated: 03/09/2012

partner M.N0.074654

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Mar 31, 2011

We have audited the attached Balance Sheet of M/S GANGOTRI CEMENT LIMITED, as at 31st March 2011 and also the Profit & Loss A/c, and the 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 have 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.

We report as follows: -

As required by the companies (Auditor's Report) order, 2003 including Companies (Auditor's Report) (Amendment) Order' 2004 issued by the Central Government of India in terms of Sub-section (4A) of section 227 of the companies Act, 1956, we enclose in the Annexure, a Statement on the matters specified in paragraphs 4 & 5 of the said order.

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

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

ii) In our opinion, proper books of account as required by law have been kept by the company as far as appears from our examination of those books.

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

iv) In our opinion, the Balance Sheet and Profit & Loss Account and Cash Flow Statement A/c dealt with by this report, read together with significant accounting policies and notes of accounts given in Schedule "R" comply with the accounting standards referred to in Sub-section (3C) of section 211 of the Companies Act, 1956.

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

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with the Significant Accounting Policies in Schedule-R give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India.

a. In the case of Balance Sheet, of the state of affairs of the company as at 31st March'2011; and

b. In the case of the Profit & Loss A/c, of the Profit for the year ended on that date.

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

ANNEXURE TO THE AUDITORS'S REPORT REFERRED TO IN

PARAGRAPH (1) OF OUR REPORT OF EVEN DATE

TO THE MEMBERS OF

M/S GANGOTRI CEMENT LTD.

I. a. The company has maintained proper records to show its full particulars including quantitative details and situation of fixed assets.

b. We are informed that the Fixed Assets were physically verified at reasonable intervals during the year. No serious discrepanancies were noticed on such verification.

c. The Company has not disposed off any fixed assets of the Company during the year under audit.

II. a. As explained to us, the inventory of the company has been physically verified during the year by the management on quarterly basis. In our opinion the frequency of verification is reasonable.

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

c. The Company is maintaining proper records of Inventory and no material discrepancies were noticed on physical verification of inventory as compared to books records.

III. a. The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the Registers maintained U/S 301 of the Companies Act 1956 (1 of 1956).

b. As reported in clause III a, Sub-clause b, c, d are not applicable to company.

e. The Company has taken loans, secured or unsecured from companies, firms or other parties covered in the Registers maintained U/S 301 of the Companies Act 1956 (1 of 1956). Total Number of parties is 8 and amount involved (maximum amount involved) during the years Rs.61.10 Lakhs. During the year company has taken 13.50 Lacs and year-end balance was Rs.21.05 lacs.

f. In our opinion the rate of interest and other terms and conditions on which loans have been taken from the other parties listed in the register maintained under. section 301, of the companies act, 1.956 are not, prima facie prejudicial to the interest of the company.

g. In our opinion and according to the information and explanation a given to us, in respect of paying principal and interest amount of unsecured loan the terms of repayment have riot been stipulated therefore we have not made any comments ^^as.

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 nature of its business, with regard to purchase of inventory and fixed assets and for sale of goods. During the course of our audit no major weaknesses has been noticed in the internal controls.

V. (a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have not been occurred.

(b) In our opinion and having regard to our comments in para (v) above, no transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956, hence no comment called for in this regard.

VI. In our opinion and according to the information and explanations given to us the company has not accepted any deposits from public within the meaning of section 58 A & 58 AA of the Companies Act 1956.

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

VIII. According to the information and explanations given to us by the management company is being a Small Scale industries and maintenance of cost records are exempt to the company vide notification no. GSR No 425(E) Date. 03-08-1998.

IX. a. The company is regular in depositing undisputed statutory dues including provident fund, income tax, sales tax, excise duty, service tax, cess and other statutory dues with the appropriate authorities. According to information and explanation given to us, there is no undisputed arrear statutory dues as on last day of the financial year for a period of more than 6 months from the date they become payable.

b. Company has not any disputed amount hence this clause is not applicable to company.

X. Company accumulated losses at the financial year is less than of fifty percentage of net worth. Company has not incurred cash losses during the financial year, and immediately preceding financial year.

XI. Company has not taken any loans from any banks and financial institution- ' therefore no question of defaulted of payments to bank etc arise. Company has not issued any debenture.

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

XIII. The provision of special statute applicable to Chit Fund, Nidhi / Mutual benefit fund / Societies is not applicable to the company.

XIV. As per records of the company and the information and explanation given to us by the management, company is not dealing or trading in shares, securities and debentures and other investments.

XV According to the records of the company and according to the information and explanations given to us the Company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI The Company has enjoying Loan Facility from HDFC Bank. The Company has used the above loans for the purpose for which these are obtained.

XVII. According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long term investment by the Company & vice versa.

XVIII As per the records of the company and according to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the registered maintained under section 301 of the Act.

XIX The Company has not issued debentures; hence question of creation of securities does not arise.

XX. During the period covered by our audit report, the company has not raised any money by public issue.

XXI. To the best of our knowledge and belief and according to the information and explanation given to us, there is no fraud on or by the Company has been noticed during our audit or reported during the period.

for, SUNIL JOHRI & ASSOCIATES

CHARTERED ACCOUNTANTS,

FIRM REGN NO.05960C Place : Raipur

Dated : 23-08-2011 (SUNIL JOHRI)

PARTNER

M.NO.074654

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Mar 31, 2010

We have audited the attached Balance Sheet of M/S GANGOTRI CEMENT LIMITED, as at 31st March 2010 and also the Profit & Loss A/c, and the 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 have 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.

We report as follows: -

As required by the companies (Auditors Report) order, 2003 including Companies (Auditors Report) (Amendment) Order 2004 issued by the Central Government of India in terms of Sub-section (4A) of section 227 of the companies Act, 1956, we enclose in the Annexure, a Statement on the matters specified in paragraphs 4 & 5 of the said order.

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

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

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

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

iv) In our opinion, the Balance Sheet, the Profit &Loss Account and the Cash Flow Statement A/c dealt with by this report, read together with significant accounting policies and notes on accounts given in Schedule "R" comply with the accounting standards referred to in Sub-section (3C) of section211 of the Companies Act, 1956.

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

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with the Significant Accounting Policies in Schedule-R give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India.

a. In the case of Balance Sheet, of the state of affairs of the company as at 31st March 2010; and

b. In the case of the Profit & Loss A/c, of the Loss for the year ended on that date, and

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

ANNEXURE TO THE AUDITORSS REPORT REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF M/S GANGOTRI CEMENT LTD.

I. a. The company has maintained proper records to show its full particulars including quantitative details and situation of fixed assets.

b. According to the information and explanations given to us, the Company has formulated a programme of verification by which al the assets of the Company are being verified in a phased manner over a period of two years, 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 verification conducted during the year as compared with the book records.

c. The Company has not disposed off any fixed assets of the Company during the year under audit.

II. a. As explained to us, the inventory of the company has been physically verified during the year by the management on quarterly basis. In our opinion the frequency of verification is reasonable.

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

c. The Company is maintaining proper records of Inventory and no material discrepancies were noticed on physical verification of inventory as compared to books records.

III. a. The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the Registers maintained U/S 301 of the Companies Act 1956 (1 of 1956).

b. As reported in clause III a, Sub-clause b, c, d are not applicable to company.

e. The Company has taken loans, secured or unsecured from companies, firms or other parties covered in the Registers maintained U/S 301 of the Companies Act 1956 (1 of 1956). Total Number of parties is 7 and amount involved (maximum amount involved) during the years Rs.55.85 Lakhs. During the year company has taken 62.00 Lacs and year-end balance was Rs. 51.10 lacs.

f. In our opinion the rate of interest and other terms and conditions on which loans have been taken from the other parties listed in the register maintained under section 301, of the companies act, 1956 are not, prima facie prejudicial to the interest of the company.

g. In our opinion and according to the information and explanation a given to us, in respect of paying principal and interest amount of unsecured loan the terms of repayment have not been stipulated therefore we have not made any comments

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 nature of its business, with regard to purchase of inventory and fixed assets and for sale of goods. During the course of our audit no major weaknesses has been noticed in the internal control system.

V. (a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have not been occurred.

(b) In our opinion and having regard to our comments in para (v) above, no transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956, hence no comment called for in this regard.

VI. In our opinion and according to the information and explanations given to us the company has not accepted any deposits from public within the meaning of section 58 A& 58 AA of the Companies Act 1956.

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

VIII. According to the information and explanations given to us by the management company is being a Small Scale industries and maintenance of cost records are exempt to the company vide notification no. GSR No425(E) to467(E), F No. 52/19/97 CAB, Dt. 03-08-1998.

IX. a. The company is regular in depositing undisputed statutory dues including provident fund, income tax, sales tax, excise duty, service tax, cess and other statutory dues with the appropriate authorities. According to information and explanation given to us, there is no undisputed arrear statutory dues as on last day of the financial year for a period of more than 6 months from the date they become payable except contribution to Gratuity Fund.

b. Company has not any disputed amount hence this clause is not applicable to company.

X. Company accumulated losses at the financial year is less than of fifty percentage of net worth. Company has not incurred cash losses during the financial year, and immediately preceding financial year.

XI. Company has not taken any loans from any banks and financial institution therefore no question of defaulted of payments to bank etc arise. Company has not issued any debenture.

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

XIII. The provision of special statute applicable to Chit Fund, Nidhi / Mutual benefit fund / Societies is not applicable to the company.

XIV. As per records of the company and the information and explanation given to us by the management, company is not dealing or trading in shares, securities and debentures and other investments.

XV According to the records of the company and according to the information and explanations given to us the Company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI As Company has not accepted any loan; this sub clause is not applicable to company.

XVII. According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long term investment by the Company & vice versa.

XVIII As per the records of the company and according to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the registered maintained under section 301 of the Act.

XIX The Company has not issued debentures; hence question of creation of securities does not arise.

XX. During the period covered by our audit report, the company has not raised any money by public issue.

XXI. To the best of our knowledge and belief and according to the information and explanation given to us, there is no fraud on or by the Company has been noticed during our audit or reported during the period.

for, SUNIL JOHRI & ASSOCIATES

CHARTERED ACCOUNTANTS,

Place: Raipur

Dated: 13-08-2010

(SUNIL JOHRI)

PARTNER M.NO. 074654 Firm Registration No. 005960C