Kabsons Industries Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2025

To the members of KABSONS INDUSTRIES LIMITED, Hyderabad Report on the Financial Statements:

Opinion

We have audited the accompanying financial statements of KABSONS INDUSTRIES LIMITED(“the company”), which comprise the Balance Sheet as at March 31, 2025, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date and a summary of the material accounting policies and other explanatory information (hereinafter referred to as “the financial statements”)

In our opinion and to the best of our information and according to the explanations given to us, the accompanying financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standard) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2025, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those standards are further described in the Auditors responsibility for the Audit of Financial Statements section of our report. We are independent of the company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. 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. Key Audit Matters

Key Audit matters are those matters that in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

Deferred Tax Assets

Key Audit matter description:

The Company has not recognised deferred tax asset for deductible temporary differences and unused tax losses as the utilization of deferred tax assets is dependent on the company''s ability to generate future taxable profits sufficient to utilize deductible temporary differences and tax losses before they expire. We determined this to be a key audit matter due to inherent limitations in estimation and uncertainty in forecasting the amount and timing of future taxable profits and the reversal of temporary differences and utilization of tax losses.

Management has supported the non -utilization of the deferred tax assets mainly with taxable income projections which contain estimates of and tax strategies for future taxable income. Changes in the industrial scenario, the business and its markets and changes in regulations may impact these projections.

Principal Audit procedures

Our audit procedures include, among others, evaluating the future estimated business projections and projected tax computations prepared by the company to assess the recognition and measurement of the current tax and deferred tax assets and liabilities and evaluate the compliance with tax legislation. We paid attention to Longterm Forecasts and critically assessed the assumptions and judgements underlying these forecasts by considering the historical accuracy of forecasts and the sensitivities of the profit forecasts. We assessed the adequacy and the level of estimation involved.

Report on Other information other than Financial statements

The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Corporate Governance and Shareholder''s Information, but does not include the financial statements and our auditor''s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management’s Responsibility for the Financial Statements:

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 read with relevant rules issued there under and other accounting principles generally accepted in India.

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

In preparing the financial statements, the Board of Directors is responsible for assessing the company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company''s financial reporting process.

Auditor’s Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

• identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

• obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls;

• evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

• conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern;

• evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Financial Statements may be influenced. We consider quantitative materiality and qualitative factors (i) in planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Financial Statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor’s Report) Order,2020(“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, to the extent applicable.

2) As required by Section 143(3) of the Companies Act,2013 we report that:

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

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

c) the Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the books of account;

d) in our opinion, the aforesaid financial statements comply with the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of Companies (Accounts) Rules, 2014;

e) on the basis of written representations received from the directors as on 31^st March 2025 taken on record by the Board of Directors, none of the directors is disqualified as on 31^st March 2025 from being appointed as a director in terms of Section 164(2) of the Act;

f) with respect to the adequacy of internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure B", Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the company’s internal financial controls with reference to financial statements ;

g) with respect to Managerial Remuneration to be included in the Auditor’s report under Section 197(16): Company has not paid any remuneration to the directors other than sitting fees to independent directors. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us;

h) 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 Ind AS financial statements Refer Note 32 to the Ind AS financial statements;

ii. the Company has no long-term contracts and did not have derivative contracts; and

iii. the instance of delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company is as given below.

Amount (Rs.) Period to which the amount relates Due date

22.55 1994-95 19.10.2001

iv. (a) the Management has represented that, to the best of its knowledge and belief, other than as disclosed in the accounts, no funds (which are material either individually or in the aggregate) have been advanced (either from borrowed funds or share premium or any other sources or kind of funds) by the Company , to or in, any other person or entity, including foreign entity (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) the Management has represented, that, to the best of its knowledge and belief, other than as disclosed in the accounts, no funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c) based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement

v. the Company had not declared or paid any dividend during the year under Report.

vi. based on our examination which included test checks, the Company has used accounting software for maintaining its books of account for the financial year ended March 31, 2025 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with. Additionally the audit trail has been preserved by the Company as per the statutory requirements for record retention.

for K. S. RAO & Co.,

Chartered Accountants Firm Registration No:003109S Sd/-

(C. VENKATESHWARA RAO)

Partner

Place : Hyderabad Membership No: 219844

Date : 22nd May 2025 UDIN: 25219844BMOHJI8111

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Mar 31, 2024

We have audited the accompanying financial statements of KABSONS INDUSTRIES LIMITED(“the company"), which comprise the Balance Sheet as at March 31, 2024, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date and a summary of the material accounting policies and other explanatory information (herein after referred to as “the financial statements")

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion section of our report ,the accompanying financial statements give the information required by the Companies Act, 2013 (“the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standard) Rules, 2015, as amended, (“Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Qualified Opinion

The Company has not adopted and complied with the requirements of Ind AS-19 ''Employee Benefits'' in respect of the Gratuity liability which constitute a departure from the Accounting standards mentioned in the Companies (Indian Accounting Standards) Rules 2015 referred in section 133 of the Act. In view of this the liability of the company in this regard could not be ascertained. Consequently, we are unable to comment about the impact of the same on the profit for the year, income tax and shareholder''s funds.

We conducted our audit of the financial statements in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those standards are further described in the Auditors responsibility for the Audit of Financial Statements section of our report. We are independent of the company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. 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.

Emphasis of matter

We draw attention to Note 33.1 in the financial statements which states that the Company had decided not to provide interest on dealer/distributor depostis for the reasons explained in the said note. Our opinion is not modified in this reagard.

Key Audit Matters

Key Audit matters are those matters that in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report. Deferred Tax Assets Key Audit matter description:

The Company has not recognised deferred tax asset for deductible temporary differences and unused tax losses. As, the utilization of deferred tax assets is dependent on the company''s ability to generate future taxable profits sufficient to utilize deductible temporary differences and tax losses before they expire. We determined this to be a key audit matter due to inherent limitations in estimation and uncertainty in forecasting the amount and timing of future taxable profits and the reversal of temporary differences and utilization of tax losses.

Management has supported the non -utilization of the deferred tax assets mainly with taxable income projections which contain estimates of and tax strategies for future taxable income. Changes in the industrial scenario, the business and its markets and changes in regulations may impact these projections.

Principal Audit procedures

Our audit procedures include, among others, evaluating the future estimated business projections and projected tax computations prepared by the company to assess the recognition and measurement of the current tax and deferred tax assets and liabilities and evaluate the compliance with tax legislation. We paid attention to Longterm Forecasts and critically assessed the assumptions and judgements underlying these forecasts by considering the historical accuracy of forecasts and the sensitivities of the profit forecasts. We assessed the adequacy and the level of estimation involved.

Report on Other information other than Financial statements

The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Corporate Governance and Shareholder''s Information, but does not include the financial statements and our auditor''s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financialstatements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management''s Responsibility for the Financial Statements:

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act") with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 read with relevant rules issued there under and other accounting principles generally accepted in India.

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

In preparing the financial statements, the Board of Directors is responsible for assessing the company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company''s financial reporting process.

Auditor''s Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

• identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

• obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls;

• evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

• conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern;

• evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Financial Statements may be influenced.We consider quantitative materiality and qualitative factors (i) in planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Financial Statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor''s Report) Order,2020(“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, to the extent applicable.

2) As required by Section 143(3) of the Companies Act,2013 we report that:

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

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

c) the Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity 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 Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of Companies (Accounts) Rules, 2014 excepting Ind AS 19 ( Employee Benefits);

e) on the basis of written representations received from the directors as on 31^stMarch2024taken on record by the Board of Directors, none of the directors is disqualified as on31^stMarch2024 from being appointed as a director in terms of Section 164(2) of the Act;

f) with respect to the adequacy of internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate report in

"Annexure B", Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the company''s internal financial controls with reference to financial statements ;

g) with respect to Managerial Remuneration to be included in the Auditor''s report under Section 197(16): Company has not paid any remuneration to the directors other than sitting fees to independent directors. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us;

h) 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 ofpending litigations on its financial position inits Ind AS financial statements Refer Note 33to the Ind AS financial statements;

ii. the Company has nolong-termcontracts and did not have derivative contracts; and

iii. the instance of delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company is as given below.

Amount (Rs.)	Period to which amount relates to	Due date
22.55	1994-95	19.10.2001

iv.(a) the Management has represented that, to the best of its knowledge and belief, other than as disclosed in the accounts,no funds (which are material either individually or in the aggregate) have been advanced(either from borrowed funds or share premium or any other sources or kind of funds) by theCompany , to or in, any other person or entity, including foreign entity (“Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries") or provide any guarantee, security or thelike on behalf of the Ultimate Beneficiaries;

(b) the Management has represented, that, to the best of its knowledge and belief,other than as disclosed in the accounts, no funds (whichare material either individually or in the aggregate) have been received by the Company from anyperson or entity, including foreign entity (“Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c) based on the audit procedures that have been considered reasonable and appropriate in thecircumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above,contain any material misstatement

v. the Company had not declared or paid any dividend during the year under Report.

Vi based on our examination which included test checks, the Company has used accounting softwares for maintaining its books of account for the financial year ended March 31, 2024 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the softwares. Further, during the course of our audit we did not come across any instance of audit trail feature being

tampered with.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 01, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the

statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.

for K. S. RAO &Co Chartered Accountants FirmRegistrationNo:003109S

Place: Hyderabad Sd/-

Date:27^th MAY 2024 (P. GOVARDHANA REDDY)

Partner

Membership no:029193 UDIN:24029193BKFELJ9984

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Mar 31, 2014

We have audited the accompanying Financial Statements of KABSONS INDUSTRIES LIMITED, HYDERABAD (A.P)("The Company") which comprise the Balance Sheet as at 31st March, 2014 and the Statement of Profit and Loss and cash flow statement for the year then ended, and 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 in the sub-section(3C)of section 211 of the Companies Act 1956("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant tothe 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 the reasonable assurance about whether the financial statements are free from material misstatement.

An Audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatements 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 the 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 qualified audit opinion.

Basis for qualified opinion:

The Company has not adopted and complied with the requirements of AS-15 Employee Benefits'' in respect of the Gratuity liability which constitute a departure from the Accounting standards referred in section 211(3C) of the Act. In view of this the liability of the company in this regard could not be ascertained Consequently, we are unable to comment about the impact of the same on the profit for the year, income tax and shareholder''s finds.

Qualified Opinion

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

(a) In the case of the Balance Sheet, of the state of affairs of the company as at March 31, 2014;

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

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

Emphasis of matter

(a) We draw attention to Note 24.1 in the financialstatements which states that the Company''s currentliabilities exceeded its current assets by Rs. 3.36 crones. Further,as indicated by the Company''s Balance Sheet as at March 31, 2014, the net worth of the Company has eroded completely. These conditionsalong with other matters as set forth in Note 24.1, indicate the existence of a material uncertaintythat may cast significant doubt about the Company''s ability to continue as agoing concern

(b) We draw attention to Note 24.3in the financialstatements which states that the Company has not provided for the interest expense amounting to Rs. 6,34, 899for the year and Rs. 78,05,598 for earlier years against the Trade Deposits received from the Dealers/ Distributors.Consequently, the same has resulted in overstatement of profit for the year by Rs. 6,34,889, understatement of the balance in the statement of profit and loss by Rs. Rs. 84,40,497 and understatement of Current Liabilities by Rs. 84,40,497.

Other matters

The Company could not get confirmation of balances in respect of

(a) Trade Receivables amounting to Rs.42,05,216 and (b) Trade Payables amounting to Rs. 17,43,136. Consequently, we are unable to determine, if any adjustments are required to the amounts reflecting in the Balance Sheet as at March 31, 2014 and the impact of the same on the profit for the year, income tax and shareholder''s funds. Our opinion is not qualified in this regard.

Report on other Legal and Regulatory requirements

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

2. As required 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 Cash Flow statement dealt with by this report are in agreement with the books of account;

(d) except for the matter described under the basis for qualified opinion paragraph in our opinion, the Balance sheet, Statement of Profit and Loss, and Cash flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

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

(f) Since the Central Government has not issued any notification as to the rate at which 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.

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE Statement on the Companies (Auditor''s Report) Order 2003 Re: KABSONS INDUSTRIES LIMITED

i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situationof fixed assets.

(b) All the assets have not been physically verified by the management during the year but there is a regular program 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) During the year, the company has disposed off fixed assets which are not substantial part of the fixed assets.

ii) (a) The inventory has been physically verified during theyear by themanagement. In our opinion, thefrequency of verification is reasonable.

(b) 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 company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records have been properly dealt with in thebooks of account.

iii)(a) The company has not granted any loans, secured orunsecured to companies, firms or other parties covered inthe register maintained uls.301 of the Act.

(b) The company had taken interest free secured loan from a Company , interest-free unsecured loan from another Company and from a party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 31 Lakhs and the year-end balance of loans taken from such parties was Rs. 31 Lakhs.

(c) In our opinion, the terms and conditions on which loans have been taken from companies, and 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) According to explanations given to us, the lenders have not specified repayment terms. In view of this we cannot comment upon whether the payment of principal is regular.

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systemscommensurate with the size of the Companyand the nature of its business with regard to purchases of inventory,fixed assets and with regard to the sale of goods and gas. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section; and

(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 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

vi) The company has not accepted the deposits from the public within the meaning of Section 58Aand 58AA of the Companies Act, 1956 and the Rules framed thereunder.

vii) The company has no internal audit system.

viii) The Central Government has not prescribed maintenance of cost records under clause (d) of subsection (1) of Section 209 (1)(d) of the Companies Act, 1956 for the products/items dealt with by the company.

ix) (a) The company is not regular in depositing with appropriate authorities undisputed statutory dues including investor education protection fund, employee''s state insurance, sales tax. The extent of the arrears of outstanding statutory dues as at the last day of the financial year for a period of more than six months from the date they became payable are as given below:

S. Name of the Nature of the Amount Period to Due date no Statue dues (Rs.) which the amount relates

1 Companies Investor 22,550 1994-95 19.10.2001 Act, 1956 Education and Protection Fund

2 Maharashtra Sales Tax 5,817 2005-06 15.05.2005 Sales Tax Act

3 Maharashtra Sales Tax 9,538 2004-05 15.04.2005 Sales Tax Act

4 Maharashtra Sales Tax 800 2003-04 15.01.2004 Sales Tax Act

5 BST Act Sales Tax and 73,735 1997-98 15.08.2004 Penalty

6 BST Act Sales Tax and 1,34,780 1998-99 15.08.2004 Penalty

7 CST Act Sales Tax and 1,31,000 1997-98 15.08.2004 Penalty

8 CST Act Sales Tax and 5,17,000 1998-99 15.08.2004 Penalty

(b) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty, service tax and cess which have not been deposited on account of any dispute.

x) The accumulated losses of the company are more than fifty percent of its net worth. The company has not incurred cash losses during the financial year covered by our audit and as well as in the immediately preceding financial year.

xi) During the financial year covered by our audit the Company hadnot borrowed from financial institutions. Hence, clause (xi) of the above referred Order is not applicable.

xii) The company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii) The company is neither a chit fund nor a nidhi mutual benefitfund/society. Therefore, the provisions of clause 4(xiii) of the above referred Order are not applicable to the company.

xiv) The company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the above referred Order are not applicable to the company.

xv) The Company has not given any guarantee for loans taken by others from banks or financial institutions.

xvi) During the year the company has not availed any term loans from banks or financial institutions. Accordingly, the provisions of clause 4(xvi) of the above referred Order are not applicable to the company.

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

xviii) The company has not made preferential allotment of shares to parties and companies covered inthe register maintained under section 301 of the Act during the year.

xix) The company has not issued any debentures. Accordingly, the provisions of clause 4(xix) of the above referred Order are not applicable to the company.

xx) During the year the company has not raised money by public issue. Accordingly, the provisions of clause 4(xx) of the above referred Order are not applicable to the company.

xxi) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

for BRAHMAYYA & CO., Chartered Accountants. Firm''s Regn.No.0005135

Sd/- (D.SEETHARAMAIAH) Partner Membership No.002907

Place: Hyderabad

Date : 26-05-2014

---

Mar 31, 2012

1. We have audited the attached Balance Sheet of KABSONS INDUSTRIES LIMITED, HYDERABAD (A.P) as at 31st March, 2012 and also the Statement of Profit and Loss for the year ended on that date annexed thereto and the cash flow statement for the period ended on that date. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion dn these financial statements based on our audit.

2. 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 :

3. As required by the Companies (Auditors' Report) Order, 2003, issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. .

4. 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 purposes of our audit.

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

iii) The Balance Sheet, Statement of Profit and Loss and cashflow statement,dealt with by this report are in agreement with the books of account.

iv) In our opinion, the Balance Sheet, Statement of Profit & Loss and Cashflow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C)'of Section 211 of the Companies Act,1956, excepting AS-15''Employee Benefits". ,

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

5. a)lnterest for the year and for earlier years Rs.6,41,221/- and Rs.65,24,034/- respectively

against Trade Deposits received from Dealers/Distributors are not providied resulting in overstating the profit for the year by Rs.6,41,221/- and understating the current labilities by Rs.71,65,255/- (Refer Note No.25.3 of financial statements).

b)We draw attention to note No.25.1 of financial statements. The Company's current liabilities exceeded its current assets by Rs.497.07 Lakhs as on 31.03.2012. This factor along with the other matters as setforth in the note referred to, raise substantial doubt that whether the Company will be able to continue as a "Going concern". .

c)The Company has not complied with the requirements of AS-15 ‘Employee Benefits' in respect of gratuity. In view of this, the liability of the Company could not be ascertained. Consequently, we are unable to comment about the impact of this on the profit for the year.

d)There are no confirmation of balances in respect of sundry debtors, loans and advances and sundry creditors other than due from/to related parties.

6. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the notes thereon and subject to our comments in para 5 above, give the information as 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 the Statement of Profit and Loss Account, of the profit of the Company for the year ended on that date; and

iii)In the case of Cashflow Statement of the cash flows for the year ended on that date. Statement on the Companies- (Auditor's Report) Order 2003 Re: KABSONS INDUSTRIES LIMITED

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

b) AH 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) During the year, the company had disposed off fixed assets which does not affect the going concern basis.

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

b)The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the cdmpany and the nature of its business.

c)The company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records have been properly dealt with in the.books of account.

iii) a) The company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained u/s.301 of the Act. '

b)The company had. taken interest free loans from two Companies and from a party covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs 72.00 Lakhs and the year-end balance of loans taken from such parties was Rs.53.0Q Lakhs. '

c)ln our opinion, the terms and conditions on which loans have been taken from companies, and 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)Aceording to explanations given to us, the lenders have not specified repayment terms. In view of this we cannot comment upon whether the payment of principal is regular. .

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and gas. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

v) a) According to the information and explanations given to us, we are of the opinion that the particulars of

contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section and

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 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time. '

vi) The company has not accepted the deposits from the public within the meaning of Section 58Aand 58AA of the Companies Act, 1956 and the Rules framed thereunder.

vii) The company has no internal audit system.

viii) Central Government has not prescribed maintenance of cost records under clause (d) of sub-section (1) of Section 209 (1)(d) of the Companies Act, 1956 for the products/items dealt with by the company.

ix) a)The company is not regular in depositing with appropriate authorities undisputed statutory dues including investor education protection fund, employee's state insurance, sales tax. The extent of the arrears of outstanding statutory dues as at the last day of the financial year for a period of more than six months from the date they became payable and the payments tnade during the year are as given below.

The extent of the arrears of outstanding statutory dues as at the last day of the financial year for a period of more than six months from the date they become payable and the payments made during the year are as given below.

Name of Nature of the dues Amount Period to which Due Date of statue Rs. the amount relates date payment

1.Companies Act Investor Education 22,550 1994-95 19.10.2001} and Protection Fund

2.Karnataka Sales Tax Act Sales Tax 3,467 1999-00 15.05,1999} Unpaid

3.Karnataka Sales Tax Act Sales Tax 1,209 2004-05 15.03.2005}

4.Maharashtra Sales Tax Act Sales Tax 190 2000-01 15.05.2000}

5.Jharkand Sales Tax Act Sales Tax 3,271 2001-02 15.03.2002}

6.AP Sales Tax Act Sales Tax 7,525 2000-01 15.04.2001}

7.Maharashtra Sales Tax Act Sales Tax 5,817 2005-06 15.05.2005}

8.Maharashtra Sales Tax Act Sales Tax 9,538 2004-05 15.04.2005}

9.Maharashtra Sales Tax Act Sales Tax 800 2003-04 15.01.2004}

10.Maharashtra Sales Tax Act Sales Tax 5,535 2004-05 05.11.2004}

11.West Bengal Sales Tax Act Sales Tax 547 2004-05 15.01.2005}

12.West Bengal Sales Tax Act Sales Tax 23 2005-06 15.09.2005}

13.Gujarat Sales Tax Act Sales Tax 669 2005-06 15.10.2005} Unpaid

14.BST Act Sales Tax & Penalty 73,735 1997-98 15.08.2004}

15.BST Act Sales Tax & Penalty 1,34,780 1998-99 15.08.2004}

16.CST Act Sales Tax & Penalty 1,31,000 1997-98 15.08.2004}

17.CST Act Sales Tax & Penalty 5,17,000 1998-99 15.08.2004}

18.CST Act Sales Tax & Penalty 2,040 1998-99 21.02.2002}

19.ESI Act Employees State Insurance 104 2006-07 21.06.2006)

20.ESI Act Employees State Insurance 14 2006-07 21.11.2006}

21.ESIAct Employees State Insurance 265 1999-00 21.04.2000}

b) According to the information and explanations given to us, there are no dues of sales fax, income tax, customs duty, wealth tax, excise duty, service tax and cess which have not been deposited on account of any dispute.

x) In our opinion, the accumulated losses of the company are more than fifty percent of its networth. The Company has not incurred cash losses during the financial year covered by our audit and as well as in the immediately proceeding financial year.

xi) During the financial year covered by our audit the Company had not borrowed from financial institutions. Hence, clause (xi) of the above referred order is not applicable.

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

xiii) The Company is neither a chit fund nor a nidhi mutual benefit fund / society. Therefore, the provisions of clause 4 (xiii) of the above referred Order are not applicable to the company.

xiv), The company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the above referred order are not applicable to the company.

xv) The company has not given any guarantee for loans taken by others from banks or financial stitutions.

xvi). During the year the company has not availed any term loans from banks or financial institutions. Accordingly, the provisions of clause 4(xvi) of the above referred Order are not applicable to the company.

xvii) According to the information and explanations given to us and on 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.

xviii) The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year. ' .

xix) The Company has not issued any debentures. Accordingly, the provisions of Clause 4(xix);of the above referred Order are not applicable to the company.

xx) During the year the company has not raised money by public issue. Accordingly, the provisions of clause 4(xx) of the above referred Order are not applicable to the company. .

xxi) According to the information and explanations given to us, no fraud on or by the company has been noted or reported during the course of our audit.

For BRAHMAYYA & CO., Chartered Accountants Firm Regn. No.000513S

Sd/-

Place : Hyderabad (D.SEETHARAMAIAH)

Date : 01-06-2012 Partner, Membership No 2907

---

Mar 31, 2010

1) We have audited the attached Balance Sheet of KABSONS INDUSTRIES LIMITED, HYDERABAD (A P) as at 31st March, 2010 and also the Profit and Loss Account for the year ended on that date annexed thereto and the cash flow statement for the period ended on that date. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2) We conducted our audit in accordance with 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 missstatement. An audit includes examing, 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 statements presentation. We believe that our audit provides a reasonable basis for our opinion:

3) As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in theAnnexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4) 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 purposes of our audit.

ii) 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.

iii) The Balance Sheet, Profit & Loss account and Cashflow statement dealt with by this report are in agreement with the books of account.

iv) In our opinion, the Balance Sheet, Profit & Loss account and Cashflow statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

v) On the basis of the written representations received from the Directors as on 31st March, 2010 and taken on record by the Board of Directors, 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.

5) a) Interest for the year and for earlier years Rs.6,47,679/- and Rs.52,29,554/- respectively against Trade

Deposits received from Dealers/Distributors are not provided resulting in understating the Loss for the year by Rs.6,47,679/- and understating the current liabilities by Rs.58,77,233/- (Refer Note No.6 of Notes on Accounts).

b) We draw attention to note no.2 of Notes on accounts in the financial statements. The companys current liabilities exceeded its current assets by Rs.565.78 Lakhs as on 31.03.2010. This factor along with the other matters as setforth in the note referred to, raise substantial doubt that whether the company will be able to continue as a "Going Concern".

c) The Company has not complied with the requirements of AS-15 "Employee Benefits in respect of gratuity. In view of this, the liability of the Company in this regard could not be ascertained. Conse quently, we are unable to comment about the impact of this on the profit for the year.

6) In our opinion and to the Best of our information and according to the explanations given to us, the said 1956, in the matter 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 case of the Profit & Loss account, of the Profit of the company for the year ended on that date; and iii) In the case of Cashflow statement of the cash flows for the year ended on the date.

ANNEXURE Statement on the Companies (Auditors Report) Order 2003 Re : KABSONS INDUSTRIES LIMITED

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

b) All the assets have not been physically verified by the management during the year but there is a regular program 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) During the year, The company had disposed off some of the fixed assets, In our opinion, the sale of those assets does not affect the going concern assumption in respect of gas trading activity carried on by the company.

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

b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in related to the size of the company and the nature of its business.

c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records have been properly dealt with in the books of account.

iii) a) The Company has not granted any loans, secured or unsecured to Companies, firms or other parties covered in the register maintained u/s 301 of the Act.

b) The Company had taken interest free loan from two companies and from a party covered in the register maintained under section 301 of the companies Act, 1956. The maximum amount involved during the year was Rs.53.00 Lakhs and the year-end balance of loans taken from such parties was Rs.53.00 Lakhs.

c) In our opinion, the terms and conditions on which loans have been taken from companies, and 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) According to the explanations given to us, the lenders have not specified repayment terms, In view of this we cannot comment upon whether the payment of principal in regular.

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and gas. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

v) a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintaining under that section and 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 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

vi) The Company has not accepted the deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the Rules framed thereunder.

vii) The company has no internal audit system.

viii) Central Government has not prescribed maintenance of cost records under clause (d) of sub-section (1) of the section 209 (1)(d) of the companies Act, 1956 for the products / items dealt with by the Company.

ix)a) The Company is not regulat in depositing with appropriate authorities undisputed statutory dues including investor education protection fund, employees state insurance, sales tax.

b) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty, service tax and cess which have not been deposited on account of any dispute.

x) In our opinion, the accumulated losses of the company are more than fifty percent of its networth. The Company has not incurred cash losses during the financial year covered by our audit and as well as in the immediately preceeding financial year.

xi) During the financial year covered by our audit the Company had not borrowed from financial institutions. Hence, clause (xi) of the above referred order is not applicable.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares,debentures and other securities. xiii) The Company is neither a chit fund nor a nidhi mutual benefit fund / society. Therefore, the provisions ofclause 4(xiii) of the above referred Order are not applicable to the company.

(xiv) The Company not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the above referred order are not applicable to the company.

(xv) The Company has not given any guarantee for loans taken by others from banks or financial institutions. xvi) During the year the company has not availed any term loans from banks or financial institutions. Accordingly, the provisions of clause 4(xvi) of the above referred Order are not applicable to the company.

xvii) According to the information and explanations given to us and on overall examination of the balance sheetm of the company, we report that no funds raised on short-term basis have been used for long-term investment. xviii)The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section .301 of the Act during the year.

(xix) The Company has not issued any debentures. Accordingly, the provisions of Clause 4(xix) of the above referred Order are not applicable to the company. xx) During the year the company has not raised money by public issue. Accordingly, the provisions of clause 4(xx) of the above referred Order are not applicable to the company.

(xxi) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

For BRAHMAYYA & CO., Chartered Accountants Firm Regn.No.000513S

Place: Hyderabad Sd/-

Date : 13-08-2010 (D.SEETHARAMAIAH)

Partner, Membership No.2907