Kamper Concast Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2014

Report on the financial statements

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

Management''s Responsibility for the Financial Statements:

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility;

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements read with, subject to note no. 13(1) for non provision of doubtful debts, 15(4) for non provision of deferred Tax Assets / liabilities, note no. 16(1)(1) relating to non provision of excise duty Of Rs. 265.47 lacs, note no. 16(1)(2) relating to non provision of Excise duty of Rs. 328.13 lacs, note no. 16(2) relating to non Electricity bills of Rs. 8,283.79 lacs, note no. 16(3) relating to non provision of Income tax liability of Rs.154.72 lacs, and other notes appearing there on, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

Report on Other Legal and Regulatory Requirements:

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

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 and the Statement of Profit and Loss, dealt with by this Report are in agreement with the books of account.

d) in our opinion, the Balance Sheet and the Statement of Profit and Loss comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13 th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013.

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.

Annexure: A

Referred to in paragraph 3 of our report of even date.

(i) (a) Whether the company is maintaining The company has maintained proper records showing full proper records showing particulars, including full particulars,including quantitative details and quantitative details and situation of fixed assets. situation of fixed assets. (b) Whether these fixed assets As explained to us, the have been physically verified fixed assets have been by the management at reasonable physically verified by the intervals;whether any material management during the year discrepancies were noticed on at regular intervals, such verification and if so, which in our opinion is whether the same have been reasonable,having regard properly dealt with in the to the size of the Company books of account. and nature of its assets. No material discrepancies were noticed on such physical verification.

(c) If a substantial part of fixed assets,have been disposed No substantial part of off during the year,whether it fixed assets have been has affected the going concern. disposed off during the year. (ii)(a)Whether the physical verification The stock of Raw Materials of inventory has been conducted and Finished Goods has at reasonable intervals by the been physically verified management. during the year by the management at regular intervals.In our opinion, the frequency of verification is reasonable.

(b) Are the procedures of physical In our opinion and verification of inventory according to the followed by the management is information and reasonable and adequate in explanation given to us, relation to the size of the the procedures of physical company and nature of its verification of inventory business?If not, the followed by the management inadequacies in such are reasonable and adequate procedures should be reported. in relation to the size of the company and the nature of its business.

(c) Whether the company is maintaining The company is maintaining proper records of inventory and proper records of whether any material discrepancies inventories.The were noticed on physical discrepancie noticed on verification and if so, whether verification between the the same have been properly dealt physical stocks and the with in the books of accounts. book records were not material and the same have been properly dealt with in the books of account.

(iii) (a) Has the company either granted or The company had granted taken any loans, secured or loan/advances to companies, unsecured to/from companies, firms firms or parties listed in or other parties covered in the the Register maintained register maintained u/s 301 of the under section 301 of the act. If so, give the number of Companies Act, 1956. The parties and amount involved number of parties are seven in the and the amount involved in these trasaction is Rs



(b) Whether the rate of interest and The loan / advances granted other is interest terms and is interest free. As no conditions of loans given specific terms and or taken by the company, conditions on which loan unsecured or unsecured, are have been taken from prima facie prejudicial to companies, firms or the interest of the company. parties listed in the registers maintained under section 301 of the Companies Act, 1956 are made available to us, so we are unable to comment on the effect on the interest of the company

(c) Whether the payment of principal As explained to us, no amount and interest are also fixed period is stipulated regular. for payment of principal amount. However, parties to whom the Company had granted loans / advances are blocked and not repaying the loan amount and no provision for doubtful debts has been made in this regard.

(d) If overdue amount is more than As no fixed period was one lakh.whether reasonable stipulated in the case steps have been taken by the of loan granted, it is not company for recovery/payment possible to comment on its of the principal and interest. repayment obligation & overdue amount as referred to in ''a'' above.

(iv) Is there an adequate internal In our opinion and control procedure commensurate according to the with the size of the company information and provided explanations and nature of its by the management, there business, For the purchase of are adequate internal inventory and fixed assets and control procedures for the sale of goods? Whether commensurate with the size there is a continuing failure of the company and the to correct major weakness in nature of its business, the internal control. with regard to purchases of inventory and fixed assets and with regard to sale of goods and services. However, there is further scope of improvement.

(v) (a) Whether transaction that need According to the to be entered into a register information and in pursuance of section 301 explanations given to us, of the act have be we are of the opinion that so entered. the particulars of contracts or arrangements, that needto be entered into register maintained under section 301 of Companies Act,1956 have been so entered.

(b) Whether each of these Based on the information transaction have been made explanation given at prices which are and to us, we are of the reasonable having regard to opinion that the the prevailing market prices transactions made in at the relevant time, pursuance of Contracts or agreements entered in the register-rnaintained under section 301of the companies Act, 1956 and exceting the value ofrupees five lacs in respect of any party during the year have been made at reasonable prices, having regard to the prevailing market price at the relevant time.

(vi) In case of company accepted deposits from the public, whether the directives issued by the reserve bank of india and the provisions of sections No, during the period of 58A and 58AA of the act and audit the company does not the rules trained there under, accepted deposits from the where applicable, have been public. complied with. If not the nature of contravention should be stated. If an order has been passed by the company law board whether the same has been complied with or not

(vii) In case of listed companies and /or other companies having paid -up capital and reserves exceeding Rs 50 lakhs as at the In our opinion the internal commencement of the financial audit system as entorced year concerned, or having during the year was an average annual turnover commensurate with the size exceeding five crores rupees and nature of the Companys for a period of three business, however, there is consecutive financial further scope for years immediately preceeding improvement, the financial year concerned, whether the company has an internal audit system commensurate with the size and nature of its business.

(viii) Where the maintainance of cost The Central Government has records has been prescribed by prescribed maintenance of the central government under cost records under Section clause (d) of sub - section 209(1 )(d)of the Companies, 209 (1) (d) of the act. Whether Act 1956 in respect of such accounts and records have certain manufacturing been made and maintained. activity of the Company. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie,the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(ix) Is the company regular in According to the records of depositing undisputed statutory the Company, undisputed dues including provident fund, statutory dues including investor educationand protection Provident fund, Investor fund, employees state insurance, Education and Protection income - tax, sales tax, wealth fund, Employees State - tax, custom duty, excise duty, Insurance, Income tax, ccss and any other statutory Sales tax, Wealth tax dues as with the appropriate Service Tax, Custom duty, authorities and if not, the Excia duty,Cess and any extent of the arrears of other statuory dues have outstanding statutory dues as been generally deposited at the last day of the financial with the appropriate year concerned for a period more authorities. According to than six months from the date they information and become payable, shall be indicated explanations given to us,no by the auditor. (BIFR Case) undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2014, for a period of more than six months from the date of they becoming payable, except in the case of the following disputed statutory dues that have not been deposited on account of matters pending before appropriate authorities. These dues are as under.

Name of the Nature of Amount Amou Period to Forum Where Statute Dues Disputed (Rs. nt Paid which the dispute In Lacs) (Rs. In amount is pending Lacs) relates Central compoun Excise Ding duty 530.94 - 1997-00 Commissio- Department ner Central Excise, Patna Case No. O-IN-O.NO-25-28 MP/COMMR. DENOVO/2001/DT-1 1.09.2001

Central Clandesti Excise ne removal 328.13 20.00 2000-02 Cestat, Department of goods Kolkata Case No. 0-IN-O 04/DENOVO/AAYUKT/2008/DATED-31.03 .2008

BSEB Electric 957.47 45.00 1999-00 Honb''l Bill for Patna the power High cut period Court

Case No. CWJC 12 53 8-99-00

Cabinet Excess Vigilance Capacity 7326.32 - 2000-05 Honb''l Department of furnace Patna High Court Case no. CWJC 11 4/06

Income Tax Scrutiny Department Proceedings 154.72 - 1997-98 Commiss ioner IT Appeal

Case No. ITA-220/A- 1-2005-06

(b) In case dues of sales tax/ income tax/custom tax/wealth tax / excise duty/cess have not been deposited on account of any dispute, then the amounts involved and the As mentioned above forum where dispute is pending may please be mentioned.

(x) Whether in case of company which The company has been has been registered for a period registered for a period not less than five years, its more than live years add accumulated losses at the end of its accumulated loss at the the financial year are not end of the financial year lessthan fifty percent of its is in excess of fifty net percent of its net worth and worth. The Company has whether it has incurred cash accumulated loss of losses in such financial year Rs. 1244.13lacs (Previous and in the financial year Year Rs. 713.81 lacs) immediately preceeding such at the end of the financial financial year also year ending 31st March 2014. The Company has incurred cash loss of Rs.531.22 lacs during the current financial year.

(xi) Whether the company has Based on our audit defaulted in repayments of dues procedures and according to a financial institutions or to information and Bank or debenture holders If yes, explanations given to us, the period and amount of default we are of the opinion that to be reported. the company has not defaulted in repayment of dues to

(xii) Whether adequate documents and records are maintained in cases In our opinion and according where the company has granted to the information and loans and advances on the basis explanations given to us, of security by the way of pledge the company has not granted of shares, debentures and other any loans and advances on securities; if not. The the basis of security by deficiencies to be pointed out. way of pledge of shares and other securities.

(xiii) whether the provisions of The company is not a chit any special statue applicable fund company and does not to chit fund have been duly have any nidhi/mutual complied benefit fund/ Society. So, the provision of clause 4(xiii) of the Companies (Auditor''s Report) (Amendment) Order, 2004 are not applicable.

(xiv) If the company is dealing or trading in shares, securities, debentures and other investments whether proper records have been The company is not dealing maintained of the transactions or trading in shares, and contracts and whether timely securities,debentures and entries have been made therein ; other investments. also whether the shares, Accordingly, the provision securities, debentures and of clause 4(xiv) of the other securities have been held Companies (Auditor s Report) by the company, in its own name (Amendment) Order, 2004 are except to the extent of not applicable, exemption, if any, granted under section 49 of the act.

(xv) whether the company has given According to the information any guarantee for loans taken and explanation provided by by others from bank or financial the management, the Company institutions, the terms and has given corporate conditions whereof are guarantee for loans taken by prejudicial to the interest of City Rolling Mills Pvt.Ltd., the company. a related party, For Rs. 423.28 Lacs from State bank of India.

(xvi) Whether the term loans were applied for the purpose for which the loans were obtained. Not Applicable

(xvii) Whether funds raised on According to the information short-terms basis have been and explanations given to us used for long- term investment and on an overall and vice - versa. If yes, examination of the Cash Flow the nature and amount is to be Statement and Balance Sheet indicated. of the Company, we are of the opinion that no funds raised on short-term basis have been used for long term investment.

(xviii)Whether the company has made any preferential allotment of The company has not made shares to parties and companies preferential allotment of covered in the register shares to parties, covered maintained under section in the register maintained 301 of the act, and if so under section 301 of the whether the price at which the Companies Act, 1956. shares have been issued is prejudicial to the interest of the company.

(xix) Whether securities have been The company has not issued created in respect of debentures any debentures during the issued year (xx) Whether the management has disclosed on the end use of The Company has not raised money by public issues and the money through public issue same has been verified. during the year.

(xxi) Whether any fraud on or by the Based upon the audit company has been noticed on procedures and information reported during the year.If yes, and explanation given by the nature and the amount the the management, we involved is to be indicated. report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For SINGHANIAAGRAWAL & CO. Chartered Accountants New Dak Bunglow Road, Patna. FRN No. 005527C The 21st day of August, 2014

S.C.Agrawal, M.No.- 072510 Partner

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Mar 31, 2013

Report on the financial statements

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

Management''s Responsibility for the Financial Statements;

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

Auditor''s Responsibility:

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements read with, subject to note no. 12(1). relating to non provision of doubtful debts of Rs. 229.69 lacs, note no. 14(4) for non provision of deferred Tax Assets / liabilities, note no. 15(1)(1) relating to non provision of excise duty of Rs. 265.47 lacs, note no. 15(1)(2) relating to non provision of Excise duty of Rs. 328.13 lacs, note no. 15(2) relating to non provision of Electricity bills of Rs. 8,283.79 lacs, note no. 15(3) relating to non provision of Income tax liability of Rs. 154.72 lacs, and other notes appearing there on, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

Report on Other Legal and Regulatory Requirements:

1. As required by the Companies (Auditor''s Report) Order, 2003 ("theOrder") issued by the Central Government of India in terms of sub-section (4 A) of section 227 of the Act, we give in the Annexure '' 1'' 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, and Statement of Profit and Loss, dealt with by this Report are in agreement with the books of account.

d) in our opinion, the Balance Sheet, and Statement of Profit and Loss comply with the Accounting Standards referred to in subsection (3 C) of section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

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

For SINGHANIA AGRAWAL & CO.

Chartered Accountants.

FRN No. 005527C

New Dak Bunglow Road Patna

The 21st day of August 2013 (S.C.Agrawal,

M.No.- 72510)

Partner.

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Mar 31, 2010

We have audited the attached Balance Sheet of M/S KAMPER CONCAST LIMITED as at 31st March 2010, the Profit & Loss Account and also Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit,

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

As required by the Companies (Auditors Report) (Amendment) Order, 2004 issued by the Central Government in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we annex hereto a statement on the matters specified in the paragraphs 4 & 5 of the said order.

Further to our comments in the Annexure referred to above, 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 it appears from our examination of those books.

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

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

e. 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 31s 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.

f. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with, subject to note no. 2(a) relating to non provision of excise duty of Rs. 265.47 lacs, note no. 2(b) relating to non provision of Excise duty of Rs. 2344.41 lacs, note no. 2(c) relating to non provision of Electricity bills of Rs. 8,986.17 lacs, note no. 2(d) relating to non provision of Income tax liability of Rs. 1,071.18 lacs, note no. 2(h) for non provision of deferred Tax Assets / liabilities, and note no. 2(j) relating to non provision of doubtful debts of Rs. 391.72 lacs, and other notes appearing thereon, 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,

(1) In the case of the Balance Sheet of the state of affairs of the company as at 31st March 2010, and

(2) In the case of Profit & Loss Account of the Profit of the company for the year ended on that date.

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

ANNEXURE 1 OF AUDIT REPORT REFERRED TO IN PARAGRAPH 3 OF OUR

REPORT OF EVEN DATE

1. In respect of its fixed assets:

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

(b) As explained to us, the fixed assets have been physically verified by the management during the year at regular intervals, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

(c) The company has not disposed any part of fixed assets during the year.

2. In respect of its inventories:

(a) The stock of Raw Materials and Finished Goods has been physically verified during the year by the management at regular intervals. In our opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanation given to us, the procedures of physical verification of inventory 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 inventories The discrepancies noticed on verification between the physical stocks and the book records were not material and the same have been properly dealt with in the books of account.

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

(a) The company had granted loan/advances to companies, firms or parties listed in the Register maintained under section 301 of the Companies Act, 1956. The number of parties are eight and the amount outstanding at the end of the year is Rs. 374.00 lacs

(b) The company had taken unsecured loans from four parties listed in the Register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year for loans taken were Rs 9.35 lacs.

(c) The loan granted/taken is interest free. As no specific terms and conditions on which loan have been taken from companies, firms or parties listed in the registers maintained under section 301 of the Companies Act, 1956 are made available, so we are unable to comment on the effect on the interest of the company.

(d) As explained to us, no fixed period is stipulated for repayment/payment of principal amount. However, parties to whom the Company had granted loans are bloe&d.arid!r{ot¦-.

repaying the loan amount and no provision for doubtful debts has been made in this regard.

(e) As no fixed period was stipulated in the case of loan granted, it is not possible to comment on its repayment obligation & overdue amount as referred to in a above.

4. In our opinion and according to the information and explanations provided by the management, there are adequate internal control procedures commensurate with the size of the company and the nature of its business, with regard to purchases of inventory and fixed assets and with regard to sale of goods and services. However, there is further scope of improvement.

5. In respect of transactions covered under section 301 of Companies Act, 1956.

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

(b) Based on the information and explanation given to us, we are of the opinion that the transactions made in pursuance of contracts or agreements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year have been made at reasonable prices, having regard to the prevailing market price at the relevant time.

6. The company has taken loans from others in contravention to the rules framed under section 58A, 58AA and any other relevant provisions of the Companies Act, 1956. No return or approval is made in this regard. As explained by the management, as no fixed period was stipulated for the repayment and the loans are interest free, no provision for interest is made.

7. In our opinion the internal audit system as enforced during the year was commensurate with the size and nature of the Companys business, however, there is further scope for improvement.

8. The Central Government has prescribed maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956 in respect of certain manufacturing activity of the Company. As per information and explanations given to us and books of Accounts examined by us, we are of the opinion, that prima facie, the prescribed accounts and records have not been maintained.

9. In respect of statutory dues:

(a) According to the records of the Company, undisputed statutory dues including Provident fund, Investor Education and Protection fund, Employees State Insurance, Income tax, Sales tax, Wealth tax, Service Tax, Custom duty, Excise duty, Cess and any other statutory dues have been generally deposited with the appropriate authorities. According to information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2010, for a period of more than six months from the date of they becoming payable.

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

Name of the Nature of Amount Amount Peroid to Forum statute the dues Disputed Paid (Rs. Which the Where (Rs.In In lakhs) amount dispute lakhs) related is pending

Central Compoundi 530.94 - 1997-00 Commiss Excise Dept. ng Duty ioner Centeral excise Patna Case No.0-IN-O.NO-25-28 MP/COMMR.DENOVO/2001/DT-11.09.2001

Central Clandestine 328.13 20.00 2000-02 CESTAT Excise removal of Kolkata Department goods

Case No. 0-IN-0 04/DEN0V0/AAYUKT/2008/DATED-31.03.2008

Central Excise Dispatch 79.57 - 2002-03 Commiss Department of goods ioner without (Appeal) paying Central duty excise, Patna

Case No. O-IN-0 NO-08/MP/ADDL.COMMR/2004DT- 13.02.2004

Central Excise Duty 1936.71 - 2002-07 Commiss Department Demanded ioner for Central higher excise, consump Patna tion of electri city

Case No. O-IN-0 NO. 23-24/MP/COMMR/2008DATED-26.09.2008

Elect. Bill B.S.E.B for the 957.47 45.00 1990-00 Honble power cut Patna period High Court Case No. CWJC 12538-99-

Minimum B.S.E.B annual 29.48 14.74 1988-99 GM cum guarantee Cheif Engg. Patna Case No.

Meter tempering 308.66 77.00 2008-09 Honble B.S.E.B & 107.43 - Patna Outstandin High g bill Court

Case No. CWJC8989/08

Cabinet Excess Vigilance capacity of 7326.32 - 2000-05 Honble Department furnace Patna High Court Case no. CWJC 114/06

Income tax Scrutiny 154.72 - 1997-98 Commiss Department proceeding ioner IT Appeal Case No. ITA-220/A-1-2005-06

Income tax Scrutiny 898.90 - 1996-97 Commiss Department proceeding ioner IT Appeal

Case No. ITA-302/A-1/2002-03

Income tax Scrutiny 17.56 - 1999-00 Commiss Department proceeding ioner IT Appeal Case No.ITA-303/A-1/2002-03

10. The company has been registered for a period more than five years and its accumulated loss at the end of the financial year is not more than fifty percent of its net worth. The Company has accumulated loss of Rs.362.10 lacs (Previous Year Rs. 411.41 lacs) at the end of the financial year ending 31st March 2010. The Company has not incurred cash loss during the current financial year.

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

12. In our opinion and according to the information and explanations given to us, the company has not granted any loans and advances on the basis of security by way of pledge of shares and other securities.

13. The company is not a chit fund company and does not have any nidhi/mutual benefit fund/ Society. So, the provision of clause 4(xiii) of the Companies (Auditors Report) (Amendment) Order, 2004 are not applicable.

14. The company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provision of clause 4(xiv) of the Companies (Auditors Report) (Amendment) Order, 2004 are not applicable.

15. According to the information and explanation provided by the management, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

16. According to the information and explanations provided by the management and the books and records examined by us, the company has not taken further term loans during the year.

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

18. The company has not made preferential allotment of shares to parties, covered in the register maintained under section 301 of the Companies Act, 1956.

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

20. The Company has not raised money through public issue during the year.

21. Based upon the audit procedures and information and explanation given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For SINGHANIA AGRAWAL & CO. Chartered Accountants.

New Dak Bunglow Road Patna.

The 1st day of September 2010. ( S.C.Agrawal, M.No.- 72510) Partner