Kamar Chemicals & Industries Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2014

1. The financial statements of the Company for the year ended March 31, 2014 ("the original financial statements for the ended March 31, 2014) were audited by M/s. Nataraj Associates, Chartered Accountants, Chennai-18 and that audit report dated May 29, 2014 ("the audit report on the original financial statements") expressed an qualified opinion on the same. The original financial statements and the audit report on the original financial statements for the year ended March 31, 2014 were adopted by the shareholder of the Company in the annual general meeting of the Company held on September 22, 2014. The financial statements for the ended 31-03-2014 together with the report of the auditors dated 29-05-2014 is referred to as original financial statements.

The attached audited financial statements for the year ended 31-03-2014 and adopted by the Board in its meeting held on 20-01 -2015 are referred to "revised financial statements".

In the original financial statement a sum of Rs.7,71,43,052/- being the balance standing to the credit of SIPCOT as on 31-03-2014 was credited in the Profit and Loss account since as per the opinion obtained from the legal advisors, such liabilities did not exist. The then auditors had qualified in its report that the writing back of the amounts standing to the credit of SIPCOT with out any legal backing was not proper. The Directors also had given their reply to the comments on the auditors in its director''s report. The Directors Report together with audit qualifications in the original financial statements was adopted by the shareholders in the Annual General Meeting held on 22-09-2014.

After such adoption, the Directors were advised by legal exerts that the comment of the auditors in the original financial statements was correct and that the company could write it back to the Profit and Loss account only with thelegal backing. In view of this Directors felt that the originalfinancial statements could be revised.

The Department of Company Affairs, in its Circular No. 1 /2003 dated 13-01 -2003 has clarified that a Company could reopen and revise its accounts after their adoption in the Annual General Meeting and filling with the Register of Companies, in order to present the true and fair view of the state of affairs of the company and that such revised annual accounts should be adopted in the subsequent annual general meeting or in an Extra-ordinary General Meeting and to be filed the Registrar of Companies, after such adoption.

In view of the opinion of the legal experts obtained by the Company after the adoption of the audited accounts on 22-09-2014 and in view of circular of Department of Company Affairs, the Directors revised the original financial statements so that the revised financial statements would exhibit true and fair view, though in the opinion of the Company that liability did not exist.

2. We have audited the revisions carried out in the original financial statements for the year ended March 31, 2014 to prepare the attached revised financial statements comprising the revised balance sheet of the Company as at March 31, 2014 and also the revised statement of profit and loss and the revised cash flow statement for the year ended on that date, both annexed thereto. These revised financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on the audit report on the original financial statements and our audit of the revisions.

Having regard to the above and the limited application of SA 560, Subsequent Events, only to the matter described in paragraph 1 above in terms of the approval of the MCA, we conducted our audit of the revisions in accordance with the auditing standards generally accepted in India.

3. We have considered the earlier auditor''s report dated 29-05-2014 on the original accounts and have examined the changes made therein which are as under:

i) In our opinion, the concept of "GOING CONCERN" is no more valid as far as this Company is concerned having regard to the following:-

a) The company has incurred a net loss of Rs.81,056/- and a cash loss of Rs.59,594/- in the current year.

b) The net worth has been fully eroded and the accumulated losses as at 31-03-2014 stand at Rs.24.12 Crores as against the net owned shareholders funds of Rs. 7.33 Crores.

c) The SIPCOT has takeover all the assets of the company during the financial Year 2007-2008 and the viability of the company appears to be doubtful as the Company is not in a position to recommence its production.

ii) In our opinion the Company should have made provision for the following long pending doubtful assets:

a) As stated in the Note No.8 - Advance made to Suppliers ofRs.1,82,15,312/-

b) As stated in the Note No.8 - Staff Advance of Rs.36,846/-

c) As stated in the Note No. 9 - Trade Receivable ofRs.52,04,945/-

Consequently, the Loss for the year on account of above is under stated by Rs.2,34,57,103/-

4. As required by the Companies (Auditor''s Report) Order, 2003, 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 and 5 of the said Order, as reported in the audit report on the original financial statements.

5. Based on the audit report on the original financial statements and our audit of the revisions, and further to the 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 appears from our examination of those books. Attention is invited to sub-para (iv) below;

(iii) The revised balance sheet, revised statement of profit and loss and revised cash flow statement dealt with by this report are in agreement with the books of account;

(iv) In our opinion, the Revised Balance Sheet, Revised Statements of Profit and Loss , Revised Cash Flow Statement comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

(v) As reported in the audit report on the original financial statements, none of the directors is disqualified as on March 31, 2014 from being appointed as a director under section 274(1)(g) of the Companies Act, 1956;

(vi) In our opinion which is based on the audit report on the original financial statements and our audit of the revisions and according to the information and explanations given to us, the said revised financial statements, 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 the revised balance sheet, of the state of affairs of the Company as at March 31, 2014;

(b) in the case of the revised statement of profit and loss, of the loss of the Company for the year ended on that date; and

(c) in the case of the revised cash flow statement, of the cash flows of the Company for the year ended on that date.

ANNEXURE REFERED TO IN THE INDEPENDENT AUDITORS'' REPORT Referred to in Paragraph (3) thereof, (i) In respect of its fixed assets:

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

b) The company has a regular program of verifying fixed assets every year which, in our opinion, is reasonable having regard to the size of the Company and nature of its assets. All the Fixed assets have been physically verified by the management. As informed, discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.

c) There was no substantial disposal of fixed assets during the year.

(ii) According to the information and explanations given to us, as the Company has suspended its production activities, the clause (ii) of this order is not applicable.

(iii) In respect of the loans, secured or unsecured, granted or taken by the Company to /from companies, firms or others parties covered in the register maintained under Section 301 of the Companies Act 1956:-

a) The Company has not granted loans to companies covered in the register maintained under section 301 of the Companies Act, 1956.

b) In the case of fully owned subsidiaries, expenses reimbursable accounts do not have any stipulation with regard to payment or other terms.

c) According to the information and explanations given to us, the Company has, during the year, not taken any loans, secured or unsecured from companies, firms or other parties covered in the Register maintained under section 301 of the Companies Act, 1956.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to the purchase of fixed assets and sale of services. On the basis of our examination and according to the information and explanations given to us, there is no continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) In respect of the contracts or arrangements referred to in Section 301 of the Companies Act 1956:-

a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 that need to be entered into the register maintained under Section 301 have been so entered.

b) In our opinion and according to the information and explanations given to us, transactions made in pursuance of such contracts or arrangements exceeding the value of five lakh rupees have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A and 58AA of the Act and the rules made there under.

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

(viii) The Company is not required to maintain cost records prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act.

(x) The company is regular in depositing with appropriate authorities undisputed statutory dues includingprovident fund, employees'' state insurance, income tax, wealthtax, service tax, customs duty, excise duty, cess and other statutory dues with the appropriate authorities and no undisputed amount is due for a period of more than six months as at 31-03-2014 from the date they became payable except sales tax payable of Rs.1,15,375/-.

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

(xii) Based on our audit procedure and as per the information and explanations given by the management, we are of the opinion that the Company has not obtained confirmation from SIPCOT the status of the balance amount shown as outstanding to SIPCOT is not quantifiable.

(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, accordingly paragraph 4 (xii) of the Order is not applicable.

(xiii) The Company is not a chit fund / nidhi / mutual benefit fund / society to which the provisions of special statute relating to chit fund etc., are applicable, accordingly paragraph 4 (xiii) of the Order is not applicable.

(xiv) As the Company is not dealing or trading in shares, securities, debentures and other investments, paragraph 4 (xiv) of the Order is not applicable.

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

(xvi) In our opinion and according to the information and explanations given to us, the Company has not taken term loan from a bank during the year.

(xvii) As the company has not raised any funds on short-term basis during the year, the provisions of clause 4(xvii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

(xviii) The Company has not made any preferential allotment of shares to parties covered under Sec 301 register during the year.

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

(xx) As the company has not raised any money by public issue during the year, the provisions of clause . 4(xx) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

(xxi) Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year ended 31st March 2014.

For S VENKATRAM & CO Chartered Accountants (FR No. 004656S)

GSITHARAMAN Place : Chennai - 600 018 Partner Date : 20-01-2015 (M. No.004841)

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Mar 31, 2012

1. We have audited the attached Balance Sheet of M/s. KAMAR CHEMICALS & INDUSTRIES LIMITED (the company) as at 31st March 2012, the Profit and Loss Account and Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the 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 Companies (Auditors’ Report) order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, and on the basis of such checks which we considered appropriate and as per the information and explanations given to us, 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 appears from our examination of those books.

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

iv) In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the Accounting Standard 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 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 directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

vi) In our opinion, the concept of “GOING CONCERN” fs no more valid as far as this Company is concerned having regard to the following:-

a) The Company has incurred a net loss of Rs.7.40 lakhs and a cash loss of Rs.7.07 lakhs in the current year.

b) The net worth has been fully eroded and the accumulated losses as at 31-3-2012 stands at Rs.23.90 Crores as against the net owned shareholders funds of Rs.7.63 Crores.

c) The SIPCOT has taken over all the assets of the company during the financial Year 2007-2008 and the viability of the company appears to be doubtful as the company is not in a position to recommence its production.

d) In view of the above, we are of the opinion that the Company’s accounts should NOT have been compiled on “GOING CONCERN” basis. Had the Company not followed GOING CONCERN ACCOUNTING, there would have been significant Adjustments to the assets and liabilities as on 31“ March, 2012, which may result in further erosion in the net worth of the Company. The impact of above on the accounts is not ascertainable at this stage.

5. In our opinion and to the best of our information and according to the explanations given to us, in view of the adverse opinion formed by us vide para vi above, the said Balance Sheet and Profit and Loss Account does not give the information required by the Companies Act 1956 in the manner so required and also does not 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 31“ March, 2012;

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

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

ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

1. (a) The Company has maintained proper records showing full particulars including quantitativ details and location of the Fixed Assets.

(b) The company has physically verified the fixed assets during the period.

(c) The Company has not disposed off substantial part of fixed assets during the period.

2. The company does not have any inventories.

3. The company has not granted or taken any loans, secured or unsecured from Companies, firms or other parties listed in the register maintained u/s.301 of the Companies Act, 1956.

4. There are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for rendering of services.

5. (a) All the contracts or agreements with parties covered under section 301 of the Companies Act,

1956 have been properly entered in the register maintained under section 301 of the Act.

(b) In our opinion, the transactions of purchase of goods, material or services and sale of goods, . materials or services, made in pursuance of contracts or arrangements entered in the register maintained under section 301 and aggregating during the period to Rs.5,00,000/- or more, in respect of each party, have been made at prices which are reasonable having regard to the prevailing market price for such goods, materials or services or the prices at which transactions for similar goods, materials or services have been made with the other parties. .

6. In our opinion, the Company has not accepted deposits from the public within the meaning of section 58Aand 58AAof the Companies Act, 1956 and the companies (Acceptance of Deposits) Rules, 1975 or any other provisions of Companies Act, 1956.

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

8. The Central Government has not prescribed for the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 for any of the products deialt by the Company.

9. Undisputed statutory dues including Inyestor Education Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, cess have generally been regularly deposited with the appropriate authorities though there have been slight delays in depositing provident fund dues.

10. The Company has accumulated losses at the end of the financial year, which is more than 100% of its net worth. The company has incurred cash losses during the year.

11. In the absence of confirmation frofa SIPCOT the status of the balance amount shown as outstanding to SIPCOT is not known.

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

13. As the Company is not a chit fund, nidhi, mutual benefit fund or society the provisions of clause 4(xiii) of the Companies (Auditor’s Report) Order, 2003 are not applicable to the Company.

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of clause 4(xiv) of the Companies (Auditor’s Report) Order, 2003 are not applicable to the Company.

15. The Company has not given any guarantee for loans taken by others from bank or financial institutions, the terms and conditions of these guarantees are not prejudicial to the interest of the Company.

16. The Company has not taken any term loans during the year.

17. According to the information and explanations given to us, we report that no funds raised on short-term basis have been used for Long-Term investments.

18. The Company has not made preferential allotment of shares to parties and companies covered in-the register maintained u/s 301 Of the Companies Act, 1956. ’

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

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

21. During the course of our examination of the books and records of the company, we have neither come across any instance of fraud by the company, noticed of reported during the year, nor have we been informed of any such case by the management. For NATRAJ ASSOCIATES Chartered Accountants

(Regn. No.002440S)

P M KRISHNAN

Place : Chennai - 600 018 Partner

Date : August, 2012 (M.No.010739)

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Mar 31, 2011

1. We have audited the attached Balance Sheet of M/s. KAMAR CHEMICALS 8. INDUSTRIES LIMITED (the company) as at 31st March 2011, the Profit and Loss Account and Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the 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 Companies (Auditors' Report) order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, and on the basis of such checks which we considered appropriate and as per the information and explanations given to us, 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 appears from our examination of those books.

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

iv) In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the Accounting Standard 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 directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, ,1956, '

vi) in our opinion, the concept of "GOING CONCERN" is no more valid as far as this Company is concerned having regard to the following:-

a) The Company has incurred a net loss of Rs.14.95 lakhs and a cash loss of Rs.14.90 lakhs in the current year.

b) The net worth has been fully eroded and the accumulated losses as at 31" March, 2011 stands at Rs.23.83 Crores as against the net owned shareholders funds of (-) Rs.16.20 Crores.

c) The SIPCOT has takeover all the assets of the Company during the Financial Year 2007-2008 and the viability of the Company appears to be doubtful as the Company is not in a position to recommence its production.

d) In view of the above, we are of the opinion that the Company's accounts should NOT have been compiled on "GOING CONCERN" basis. Had the Company not followed GOING CONCERN ACCOUNTING there would have been significant adjustments to the assets and liabilities as on 31st March, 2011, which may result in further erosion in the net worth of the Company. The impact of above on the accounts is not ascertainable at this stage.

5. In our opinion and to the best of our information and according to the explanations given to us, in view of the adverse opinion formed by us vide para vi above, the said Balance Sheet and Profit and Loss Account does not give the information required by the Companies Act 1956 in the manner so required and also does not give a true and fair view in conformity with the accounting principles generally accepted in India-

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

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

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

ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

1 (a) The Company has maintained proper records showing full particulars including quantitative details and location of the Fixed Assets.

(b) The Company has physically verified the fixed assets during the period.

(c) The Company has not disposed off substantial part of fixed assets during the period

2. The Company does not have, any inventories. '

3. The Company has not granted or taken any loans, secured or unsecured from Companies, firms or other parties listed in the register maintained u/s.301 of the Companies Act, 1956.

4. There are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for rendering of services

5. (a) All the contracts or agreements with parties covered under section 301 of the Companies Act, 1956 have been properly entered in the register maintained under section 301 of the Act.

(b) In our opinion, the transactions of purchase of goods, material or services and sale of goods, materials or services, made in pursuance of contracts or arrangements entered in the register maintained under section 301 and aggregating during the period to Rs.5,00,000/- or more in respect of each party, have been made at prices which are reasonable having regard to the prevailing market price for such goods, materials or services or the prices at which transactions for similar goods, materials or services have been made with the other parties

6. In our opinion, the Company has not accepted deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules. 1975 or any other provisions of Companies Act. 1956.

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

8. The Central Government has not prescribed for the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 for any of the products dealt by the Company.

9. The Company is regular in depositing undisputed statutory dues except there has been a slight delay in remittance of Provident Fund dues.

10. The Company has accumulated losses at the end of the financial year, which is more than 100% of its net worth. The Company has incurred cash losses during the year.

11. In the absence of confirmation from SIPCOT the status of the balance amount shown as outstanding to SIPCOT is not known.

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

13. As the Company is not a chit fund, nidhi, mutual benefit fund or society the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company,

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.

15. The Company has not given any guarantee for loans taken by others from bank or financial institutions, the terms and conditions of these guarantees are not prejudicial to the interest of the Company.

16. The Company has not taken any term loans during the year.

17. According to the information and explanations given to us, we report that no funds raised on short- term basis have been used for Long - Term investments.

18. The Company has not made preferential allotment of shares to parties and Companies covered in the register maintained u/s 301 of the Companies Act, 1956.

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

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

21. During the course of our examination of the books and records of the Company, we have neither come across any instance of fraud by the Company, noticed of reported during the year, nor have we been informed of any such case by the management.

For NATRAJ ASSOCIATES Chartered Accountants (Regn. No.002440S)

P M KRISHNAN Partner (M.No.010739)

Place : Chennai -600 018 Date : 29th July, 2011

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Mar 31, 2010

1. We have audited the attached Balance Sheet of M/s. KAMAR CHEMICALS & INDUSTRIES LIMITED (the company) as at 31st March 2010, the Profit and Loss Account and Cash Flow Statement of the Company 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.

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 the 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 Companies (Auditors Report) order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, and on the basis of such checks which we considered appropriate and as per the information and explanations given to us, 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 appears from our examination of those books.

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

iv) In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the Accounting Standard 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 2010, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 st March 2010 from being appointed as a directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements read with the statement on significant Accounting policies and Notes to the Accounts, give the information required by the Companies Act 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: -

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

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

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



ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE



1. (a) The Company has maintained proper records showing full particulars including quantitative details and location of the Fixed Assets.

(b) The company has physically verified the fixed assets during the period.

(c) The Company has not disposed off substantial part of fixed assets during the period.

2. The company does not have any inventories.

3. The company has not granted or taken any loans, secured or unsecured from Companies, firms or other parties listed in the register maintained u/s.301 of the Companies Act, 1956.

4. There are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for rendering of services.

5. (a) All the contracts or agreements with parties covered under section 301 of the Companies Act, 1956 have been properly entered in the register maintained under section 301 of the Act.

(b) In our opinion, the transactions of purchase of goods, material or services and sale of goods, materials or services, made in pursuance of contracts or arrangements entered in the register maintained under section 301 and aggregating during the period to Rs.5,00,000/- or more, in respect of each party, have been made at prices which are reasonable having regard to the prevailing market price for such goods, materials or services or the. prices at which transactions for similar goods, materials or services have been made with the other parties.

6. In our opinion, the Company has not accepted deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the companies (Acceptance of Deposits) Rules, 1975 or any other provisions of Companies Act, 1956.

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

8. The Central Government has not prescribed for the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 for any of the products dealt by the Company.

9. The Company is regular in depositing undisputed statutory dues including, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues with the appropriate authorities except VAT of Rs. 1,10,279/- which is due for a period of more than six months from the date they became payable and also there has been a slight delay in remittance of Provident Fund dues.

10. The Company has accumulated losses at the end of the financial year, which is more than 100% of its net worth. The company has not incurred cash losses during the year and in the immediately preceding previous year. "

1.1. In the absence of confirmation from SIPCOT the status of the balance amount shown as outstanding to SIPCOT is not known.

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

13. As the Company is not a chit fund, nidhi, mutual benefit fund or society the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

14. As the Company is not dealing or trading in shares, securities, debentures and other investments, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

15. The Company has not given any guarantee for loans taken by others from bank or financial institutions, the terms and conditions of these guarantees are not prejudicial to the interest of the Company.

16. The Company has not taken any term loans during the year.

17. According to the information and explanations given to us, we report that no funds raised on short- term basis have been used for Long - Term investments.

18. The Company has not made preferential allotment of shares to parties and companies covered in the register maintained u/s 301 of the Companies Act, 1956.

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

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

21. During the course of our examination of the books and records of the company, we have neither come across any instance of fraud by the company, noticed of reported during the year, nor have we been informed of any such case by the management.

For NATRAJ ASSOCIATES

Chartered Accountants

(Regn. No.002440S)

Place: Chennai-18 V RAMGANESH

Date : 31.07.2010 Partner

(M.No.220570)