Panjon Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2014

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

MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 (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.

AUDITORS'' RESPONSIBILITY

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

BASIS FOR QUALIFIED OPINION

Inventories : The company''s inventories lying at branches etc. could neither be verified nor their net realisable is ascertainable. It was observed by the management that the stocks lying at the branches were not in saleable condition and the same was expired/damaged due to improper storage/moisture/pilferage etc. Same stock has been appearing in the books since previous years. The value of such stocks in books is Rs. 3,08,56,189/-. management has not stated the inventories at lower of cost and net realisable value, which constitutes a departure from the Accounting Standards referred to in subsection (3C) of Sec 211 of the Act. The company''s records indicate that had the management stated the inventories at the lower of cost and net realisable value since it is not realisable the entire value needs to be written off, an amount of Rs. 3,08,56,189/- would have been required to write the inventories down to their net realisable value. Accordingly, cost of sales would have been increased by Rs. 3,08,56,189 and profit for the year, shareholders value and inventories, would have decreased by Rs. 3,08,56,189/- (profit would have turned into loss), income tax would have reduced by Rs. 1,49,000/-.

Patent and copyright : The management had to write off Rs. 97,92,507/- every year on patents and copyrights for 5 years and thus, total depreciation of Rs. 4,89,62,536/- would have been written off in a period of 5 years. So far management has not written off any amount on patents and copyright of Rs. 4,89,62,536/-, which is a departure from the Accounting Standards referred to in subsection (3C) of Sec 211 of the Act. The company''s records indicate that had management written off patents and copyrights, then intangible fixed assets, net profit for the year and shareholders funds, would have been lower by Rs. 4,89,62,536/- or loss would have increased.

Deferred revenue Expenses : The management has not written off Deferred Revenue Expenses of Rs. 1,54,95,605/-, which is a departure from the Accounting Standards referred to in subsection (3C) of Sec. 211 of the Act. The company''s records indicate that if the management had written off these deferred revenue expenses, the profit for the year, shareholders funds would have been lower by Rs. 1,54,95,605/- or loss would have increased.

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 aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view and are 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 31st, 2014;

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

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

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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

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

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

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

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

d. Except for the effects of the matters described inbasis for qualified opinion paragraph, in our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with Accounting Standards notified under 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.

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

Annexure referred to in the Auditor''s Report to the members of M/S PANJON LTD., INDORE on the accounts of the Company for the year ended 31st March, 2014.

On the basis of such checks as we considered appropriate and in terms of the information and explanation given to us, we state that:-

In terms of the information and explanations given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief we state that

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

(b) As explained to us, the fixed assets have been physically verified by the management during the year. 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) In our opinion, the company has not disposed of substantial parts of fixed assets during the year and the going concern status of the company is not affected.

(ii) (a) The inventory has not been physically verified during the year by the management and were not made available for verification. In our opinion, the frequency of verification is not reasonable. Quantity, value and location of brought forward/carried forward stock has not been verified by us and it is not verifiable and not properly maintained. Also nature of the goods is expirable and cannot be consumed after lapse of certain time or if not stored properly, company has not taken stock quantity and value from that perspective and hence exact amount cannot be ascertained.

(b) The procedures of physical verification of inventories followed by the management are not reasonable and inadequate in relation to the size of the company and the nature of its business.

(c) The company is not maintaining proper records of inventory. As informed to us, the discrepancies noticed on verification between the physical stocks and the book records were material and not dealt with in the books of account.

(iii) (a) The Company has received Unsecured Loans and Trade Deposits from parties listed in the Register required to be maintained under section 301, which are treated as unsecured loan. The total No. of parties (directors and relative) are two and amount outstanding as on 31.03.14 is Rs. 105.54 lacs (Previous year R804.61) and maximum outstanding is Rs. 270.04 lacs. According to the information and explanation given to us, the rate of interest and other terms and conditions of the loan are prima-facie not prejudicial to the interest of the company. The Company is regular in repayment of deposits and there are no overdue.

(b) The company has not granted unsecured loans, advances to the Companies, Firms and Parties listed in the Register required to be maintained under section 301. The Total No. Of Parties are nil and amount outstanding as on 31.03.2014 is Rs. nil (Previous year Rs. 7.61 lacs) and maximum outstanding is Rs. nil. According to the information and explanations given to us, the rate of interest and other terms and conditions of the loan are prima-facie, prejudicial to the interest of the Company.

(c) The debtors are not regular in repaying the principal amounts as stipulated and also irregular in payment of interest.

(d) In our opinion the company has not taken reasonable steps to recover the loan amount.

(iv) In our opinion and according to the information and explanations given to us, the internal control is not adequate 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 services. During the course of our audit, we have observed continuing failure to correct major weaknesses in internal controls.

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts of arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year have been made but the reasonability of the prices having regard to prevailing market prices at that time cannot be ascertained.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits hence provisions of section 58A and 58AA of the Companies Act are not applicable to company, except Business deposits and from directors.

(vii) In our opinion, the company does not have Internal audit system commensurate with the size and nature of its business.

(viii) As informed and explained to us, the Central Government has ordered for maintenance of cost records under section 209(1)(d) of the companies Act vide order dated 16/03/2006 of the Central Government but the cost audit has not been completed till date.

(ix) (a) The company is generally irregular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund, ESIC, sales tax, income-tax TDS, service tax, cess and other material statutory dues applicable to it. Exact amount of dues is not known as relevant records could not be produced.

(b) According to the information and explanations given to us and records of the Company examined by us, the particulars of dues as at 31/3/2014, which have not been deposited on account of a dispute, are as follows.

Name of the Nature of the Amount under Forum where Statute Dues dispute not yet dispute is pending deposited

Excise Duty 2002-03 167530/- Stayed from High Court

Income Tax FY 1993-1994 (A.Y. 1994-95) 142130/- Rectification field

(x) The company does not have accumulated loss, as at the end of year the company more than fifty percent of its net worth subject to qualifications in the audit report. The company has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the company is not in default of repayment of dues to financial institution/Bank as at 31.03.2014.

(xii) We are of the opinion that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

(xv) As informed and explained to us the company has not given guarantees for loans taken by others from banks or financial institutions.

(xvi) The Company has not raised any term loan during the year under review.

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

(xviii) According to the information and explanations given to us, the company has made preferential allotment of 1,00,00,000 eq. shares of Rs. 10/- each for cash at par, out of which 65,00,000 equity shares of Rs. 10/- each for cash at par have been issued to parties and companies covered in the register required to be maintained under section 301 of the Act.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the company had not issued any debenture.

(xx) The company has not made any Public issue of shares during the year.

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

PLACE : INDORE For Trilok Jain & Co. DATE : 22nd September, 2014 Chartered Accountants FRN 00341C

(T.C. Jain) Partner M.No. 012712

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Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

The Company''s 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 an accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of 1L; Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

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

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

Opinion

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

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

(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003("the Order") issued by the Central Government of India in terms of 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 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 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 sub-section (3C) of section 211 of the Act.

(e) On the basis of the written representations received from the directors as on 31st March, 2013 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2013 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 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.

Annexure referred to in the Auditor''s Report to the members of M/S Panjon LTD., INDORE on the accounts of the Company for the year ended 31st March, 2013

On the basis of such checks as we considered appropriate and in terms of the information and explanation given to us, we state that:-

1. The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The management during the year at reasonable intervals physically verified the fixed assets. To the best of our knowledge, no material discrepancies have been noticed on such verification. Substantial part of the fixed assets has not been disposed off during the year, and therefore, does not affect the going concern status of &§ company.

2. Inventory has not been physically verified by the management and were not made available for verification. In our opinion, the procedure followed by the management for physical verification is not reasonable and adequate in relation to size of the company and nature of its business. On the basis of examination of the inventory records of the company, we are of the opinion that company is not maintaining proper records of the inventory. Quantity, value and location of brought forward / carry forward stock has not been verified by us and it is not verifiable and not properly maintained. Also nature of the goods is expirable and cannot be consumed after lapse of certain time or if not stored properly, company has not taken stock from that perspective and hence exact amount cannot be ascertained.

The procedures of physical verification of inventories followed by the management are not reasonable and inadequate in relation to the size of the company and the nature of its business.

The company is not maintaining proper records of inventory. As informed to us, the discrepancies noticed on verification between the physical stocks and the book rec(JPjs were material and not dealt with in the books of account.

3. The company has taken unsecured loans from companies, firms and other parties mentioned in register maintained under section 301 of the companies Act, 1956. The loans have been taken from Nine parties and the amount outstanding as on 31.03.2013 is Rs. 804.61 (prev yr. Rs. 211.53 Lacs). The maximum outstanding amount of loan taken during the year was Rs. 824.35 Lacs (Rs. 235.65 Lacs). In our opinion, the rate of interest and other terms and conditions on which company has taken loans, are not prima facie prejudicial to the interest of the company. The terms and conditions regarding repayment of such loans have not been stipulated. As the terms and conditions have not been stipulated therefore, we cannot comment whether principal is overdue or not by more than 1 lacs.

4. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its activities with regard to purchase of inventory, fixed assets and for the sale of goods & services. During the course of audit, we have not come across any major weaknesses in internal controls.

5. a) On the basis of the audit procedures performed by us, and according to the information, explanations and representations given to us, we are of the opinion that, the transactions in which directors were interested, and which were required to be entered in the register maintained under Section 301 of the Companies Act, have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at that time.

6. According to the information and explanations given to us, the company has not accepted any deposit from the public and so question of compliance with the directives issued by the Reserve Bank of India and provisions of Section 58A of the Companies Act, 1956 and Acceptance of Deposit Rules 1975 does not arise.

7. In our opinion, the company has No internal audit system commensurate with the size and nature of its business.

8. As informed and explained to us, the Central Government has ordered for maintenance of cost records under section 209(l)(d) of the companies Act vide order dated 16/03/2006 of the Central Government but the cost audit has not been completed till date.

9.The company is generally irregular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund ESIC, Sales Tax, Income-tax not known as relevant records could not be produced.

10. The company has neither accumulated losses at the end of the financial year nor has it incurred cash losses, both in the financial year under report and in the immediately preceding financial year.

11. As informed and explained to us, the company has not defaulted in repayment of dues to financial institutions and banks as at the balance sheet date.

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

13. According to the information and explanations given to us, the provisions of any special statute applicable to chit fund are not applicable to the company.

14. According to the information and explanations given to us, the company is not dealing or trading in shares, securities, debentures and other investments. -^.

15. According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from bank or financial institutions.

16. According to the information and explanations given to us and on the basis of our examination of books and records, the company has applied term loans during the year for the purpose for which these loans were obtained.

17. According to the information and explanations given to us and on the basis of our examinations of books and records, the company has not used funds raised on short-term basis for long- term investments.

18. According to the information and explanations given to us and on the basis of our examination of books and records, the company has not made any preferential allotment of shares to parties covered in the Register maintained under Section 301 of the Companies Act, 1956 during the year under audit.

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

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

21. According to the information and explanations given to us, no fraud on or by the compi^ has been noticed or reported during the year under audit.

Trilok Jain & Co.

Chartered Accountants

Firm Registration No: 00341C

Place: Indore (T C Jain)

Date: 1st August, 2013 Partner

Membership No: 012712

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Mar 31, 2011

We have audited the attached Balance sheet of PANJON LIMITED, INDORE 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.

We conducted our audit in accordance with auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

1. As required by Companies (Auditors Report) Order, 2003 issued by the Central Government in terms of section 227(4A) of the Companies Act, 1956, we annex hereto statement on the matter specified in the order.

2. Further to our comments in the Annexure referred to in paragraph (1) above.

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

(b) In our opinion, proper books of accounts, as required by law have been kept so far, as appears from our examination of the books.

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

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

(e) On the basis of written representation received from the directors and taken on records by board we mention that no directors of the Company are disqualified from being appointed in according with Clause (g) of sub section (i) of Section 274, as on 31st March 2011 on the said date.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with and subject to the notes thereon specifically notes no. (i), (vii) &

(viii) of Notes to Accounts relating to valuation of inventories, debtors, creditors, current assets and current liabilities, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view.

(I) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2011 and

(ii) in the case of the Profit & Loss of the Loss of Company for the year ended on that date.

iii) in the case of cash flow statement of the cash flows of the company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT REFERRED TO IN PARAGRAPH 1 OF THE AUDITOR'S REPORT OF EVEN DATE TO THE MEMBERS OF PANJON LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH 2011.

In terms of the information and explanations given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief we state that (i) (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets have been physically verified by the management during the year. 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) In our opinion, the company has not disposed of substantial parts of fixed assets during the year and the going concern status of the company is not affected.

(ii) (a) The inventory has not been physically verified during the year by the management and were not made available for verification. In our opinion, the frequency of verification is not reasonable. Quantity, value and location of brought forward / carried forward stock has not been verified by us and it is not verifiable and not properly maintained. Also nature of the goods is expiable and cannot be consumed after lapse of certain time or if not stored properly, company has not taken - stock from that perspective and hence exact amount cannot be ascertained.

(b) The procedures of physical verification of inventories followed by the management are not reasonable and inadequate in relation to the size of the company and the nature of its business.

(c) The company is not maintaining proper records of inventory. As informed to us, the discrepancies noticed on verification between the physical stocks and the book records were material and not dealt with in the books of account.

(i'i) (a) The Company has received Unsecured Loans and Trade Deposits from parties listed in the Register maintained under section 301. Which are treated as unsecured loan. The total No. of parties (directors and relative) are Six and amount outstanding as on 31.03.11 is Rs. 120.37 lacs (Previous year Rs. 101.95 lacs) and maximum outstanding is Rs. 120.43 lacs. According to the information and explanation given to us, the rate of interest and other terms and conditions of the loan are prima-facie not prejudicial to the interest of the company. The Company is regular in repayment of deposits and there are no overdue.

(b) The company has granted unsecured loans, advances to the Companies, Firms and Parties listed in the Register maintained under section 301. The Total No. Of Parties are five and amount outstanding as on 31.03.2011 is Rs. 36.69 lacs (Previous year Rs. 36.69 lacs) and maximum outstanding is Rs.36.69 lacs. According to the information and explanations given to us, the rate of interest and other terms and conditions of the loan are prima-facie, prejudicial to the interest of the Company.

(c) The debtors are not regular in repaying the principal amounts as stipulated and also irregular in payment of interest.

(d) In our opinion the company has not taken reasonable steps to recover the loan amount.

(iv) In our opinion and according to the information and explanations given to us, the internal control is not adequate 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 services. During the course of our audit, we have observed continuing failure to correct major weaknesses in internal controls.

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts of arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of upees five lacs in respect of any party during the year have been made but the reasonability of the prices having regard to prevailing market prices at that time cannot be ascertained.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits hence provisions of section 58A and 58AA of the Companies Act are not applicable to company, except Business deposits and from directors and shareholders.

(vii) In our opinion, the company does not have Internal audit system commensurate with the size and nature of its business

(viii) As informed and explained to us, the Central Government has ordered for maintenance of cost records under section 209(1)(d) of the companies Act vide order dated 16/03/2006 of the Central Government but the cost audit has not been completed till date.

(ix) (a) the company is generally irregular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund, ESIC, sales tax, income-tax TDS, service tax, Cess and other material statutory dues applicable to it. (b) According to the information and explanations given to us and records of the Company examined by us, the particulars of dues as at 31/3/2Q11, which have not been deposited on account of a dispute, are as follows.

Name of the Nature of the Amount under Forum where dispute is statute Dues dispute not yet Pending deposited Sales Tax Revision application with Asst.

81430/- Comm. 2004-05 Excise Duty MPCT Stayed from High Court

167530/-

Income Tax 2002-03 142130/- Rectification filed



FY 1993-1994 (AY. 1994-95)

The company does not have accumulated loss, as at the end of year the company more than fifty percent of its net worth. The company has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the company is not in default of repayment of dues to financial institution/Bank as at 31.03.2011.

(xii) We are of the opinion that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. (xiii) In our opinion, the company is not a chit fund or a nidhi I mutual benefit fund/society. Therefore, the Provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xv) As informed and explained to us the company has not given guarantees for loans taken by others from banks or financial institutions.

(xvi) The Company has not raised any term loan during the year under review.

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

xviii) According to the information and explanations given to us, the company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the company had not issued any debenture.

(xx) The company has not made any Public issue of shares during the year.

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

PLACE: INDORE For Trilok Jain & Co.

Date: 01.08.2011 Chartered Accountants

(T.C. Jain)

Partner

M.NO. 012712 FRN : 00341C

---

Mar 31, 2009

We have audited the attached Balance sheet of PANJON LIMITED, INDORE as at 31st March 2009, 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.

We conducted our audit in accordance with auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

(a) As required by Companies (Auditors Report) Order, 2003 issued by the Central Government in terms of section 227(4A) of the Companies Act. 1956, we annex hereto statement on the matter specified in the order.

(b) Further to our comments in the Annexure referred to in paragraph (1) above,

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

(b) In our opinion, proper books of accounts, as required by law have been kept so far, as appears from our examination of the books.

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

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

(a) On the basis of written representation received from the directors and taken on records by board we mention that no directors of the Company are disqualified from being appointed in according with Clause (g) of sub section (i) of Section 274, as on 31st March 2009 on the said date,

(b) In our opinion and to the best of our information and according to the explanations given to us. the said accounts read together with and subject to the notes thereon specifically notes no. (i) (vii) & (viii) of Notes to Accounts relating to valuation of inventories, debtors, creditors._ current assets and current liabilities, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view.

(I) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2008 and

II) in the case of the Profit & Loss of the Loss of Company for the year ended on that date.

III) in the case of cash flow statement of the cash flows of the company for the year ended on that date

ANNEXURE TO THE AUDITORS REPORT REFERRED TO IN PARAGRAPH 1 OF THE AUDITOR'S REPORT OF EVEN DATE TO THE MEMBERS OF PANJON LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH 2009.

In terms of the information and explanations given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief we state that

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

(b) As explained to us, the fixed assets have been physically verified by the management during the year 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) In our opinion, the company has not disposed of substantial parts of fixed assets during the year arid the going concern status of the company is not affected.

(ii)(a) The inventory has not been physically verified during the year by the management and were not made available for verification. In our opinion, the frequency of verification is not reasonable. Quantity, value and location of brought forward / carried forward stock has not been verified by us and it is not verifiable and not properly maintained, Also nature of the goods is expirable and cannot be consumed after lapse of certain time or if not stored properly, company has not taken stock from that perspective and hence exact amount cannot be ascertained.

(b) The procedures of physical verification of inventories followed by the management are not reasonable and in adequate in relation to the size of the company and the nature of its business,

(c) The company is not maintaining proper records of inventory, As informed to us, the discrepancies noticed on verification between the physical stocks and the book records were material and not dealt with in the books of account.

(iii) (a) The Company has received Unsecured Loans and Trade Deposits from parties listed in the Register maintained under section 301. Which are treated as unsecured loan, The total No, of parties (directors and relative) are four and amount outstanding as on 31.03.09 is Rs. 119.51 829/- (Previous year Rs 1.20,15,120/-) and maximum outstanding is Rs. 119.52 Lakhs According to the information and explanation given to us, the rate of interest and other terms and conditions of the lean are prima-facie not prejudicial to the interest of the company. The Company is regular in repayment of deposits and there are no overdue

(b) The company has granted unsecured loans, advances to the Companies, Firms and Parties listed in the Register maintained under section 301. The Total No. Of Parties are six and amount outstanding as on 31.03.2009 is Rs. 37.49 Lacs (Previous year Rs, 37,49 lacs) and maximum outstanding is Rs. 37.49 Lakhs. According to the information and explanations given to us, the rate of interest and other terms and conditions of the loan are prima-facie, prejudicial to the interest of the Company.

(c) The debtors are not regular in repaying the principal amounts as stipulated and also irregular in payment of interest

(d) In opinion the company has not taken reasonable steps to recover the loan amount.

(iv) in our opinion and according to the information and explanations given to us. the internal control is not adequate 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 services. During the course of our audit, we have observed continuing failure to correct major weaknesses in internal controls

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts of arrangements entered in the register maintained under section 301 of the Companies Act. 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made but the reasonability of the prices having regard to prevailing market prices at that time cannot be ascertained.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits hence provisions of section 58A and 58AA of the Companies Act are not applicable to company, except Business deposits and from directors and shareholders.

(vii) In our opinion, the company does not have Internal audit system commensurate with the size and nature of its business.

(viii) As informed and explained to us. the Central Government has ordered for maintenance of cost records under section 209(1 }(d) of the companies Act vide order dated 16/03/2006 of the Central Government but the cost audit has not been completed till date

(ix) (a) The company is generally irregular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund, ESIC, sales tax, income-tax TDS. service tax Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us and records of the Company examined by us. the particulars of dues as at 31/3/2009, which have not been deposited on account of a dispute, are as follows

Name of the Nature of the Dues Amount under Forum where dispute is Statute dispute not yet pending deposited

Sales Tax 2006-2007 156025/- Appeal pending with Dy. Comm MPCT Commercial Taxes, Indore

2006-2007 34,704/- Appeal pending with Dy. Comm Entry Tax Commercial Taxes, Indore

2004-05 81,430/- Revision application with Asst, MPCT Comm.

Excise duty 2002-03 167530/- Stayed from High Court

Income Tax FY 1993-1994 1,42,130/- Rectification filed (A.Y. 1994-95)

(x) The company does not have accumulated loss, as at the end of year the company more than fifty k percent of its net worth The company has rot incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the company is not in default of repayment of dues to financial institution/Bank as at 31.03,2009.

(xii) We are of the opinion that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) in our opinion, the company is not a chit fund or a nidhi / mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company

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

(xv) As informed and explained to us the company has not given guarantees for loans taken by others from banks or financial institutions.

(xvi) The Company has applied the funds raised by way of term loans towards the purpose for which they have been raised

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

(xviii) According to the information and explanations given to us, the company has not made preferential allotment of shares to partes and companies covered in the register maintained under section 301 of the Act

(xix) According to the information and explanations given to us, during the period covered by our audit report the company had not issued any debenture.

(xx) The company has not made any Public issue of shares during the year.

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

PLACE: INDORE For Trilok Jain & Co.

DATE: 01/08/2009 Chartered Accountants

(Bharat Jain)

Partner

M.No. 77738

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Mar 31, 2008

We have audited the attached Balance sheet of PANJON LIMITED, INDORE as at 31st March 2008, 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.

We conducted our audit in accordance with auditing standards generally accepted in India, These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

1. As required by Companies (Auditors Report) Order, 2003 issued by the Central Government in terms of section 227(4A) of the Companies Act, 1Q5S, we annex hereto statement on the matter specified in the order

2. Further to our comments m the Annexure referred to in paragraph (1) above.

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

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

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

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

e) On the basis of written representation received from the directors and taken on records by board we mention that no directors of the Company are disqualified from being appointed in according with Clause

(g) of sub section (i) of Section 274h as on 31sl March 2008 on the said date,

f) In our opinion and to the best of our information and according to the explanations given to us the said accounts read together with and sub act to the notes thereon specifically notes no. Notes to Accounts relating to valuation of inventories, debtors, creditors, Current assets and current liabilities, give the information required by the Companies Act 1956 in the manner so required and give a true and fair view,

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31&( March 2008 and

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

iii) in the case of cash flow statement of the cash flows of the company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT REFERRED TO IN PARAGRAPH 1 OF THE AUDITOR'S REPORT OF EVEN DATE TO THE MEMBERS OF PANJON LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH 2008.

In terms of the information and explanations given to us and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief we state that

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

(b) As explained to us, the fixed assets have been physically verified by the management during the year. 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)In our opinion, the company has not disposed of substantial parts of fixed assets during the year and the going concern status of the company is not affected.

(ii) (a) The inventory has not been physically verified during the year by the management and were not made available for verification. In our opinion, the frequency of verification is not reasonable, Quantity, value and location of brought forward / carried forward stock has not been verified by us and it is not verifiable and not properly maintained. Also nature of the goods is expiable and cannot be consumed after lapse of certain time or if not stored properly, company has not taken stock from that perspective and hence exact amount cannot be ascertained.

(b) The procedures of physical verification of inventories followed by the management are not reasonable and in adequate in relation to the size of the company and the nature of its business,

(c) The company is not maintaining proper records of inventory. As informed to us, the discrepancies noticed on verification between the physical stocks and the book records were material and not dealt with in the books of account.

(iii) (a) The Company has received Unsecured Loans and Trade Deposits from parties listed in the Register maintained under section 301. Which are treated as unsecured loan. The total No. of parties (directors and relative) are four and amount outstanding as on 31,03,08 is Rs. 1,20,15,120/- (Previous year Rs.1,26,21,813/-) and maximum outstanding is Rs.182 Lakhs According to the information and explanation given to us, the rate of interest and other terms and conditions of the loan are prima-facie not prejudicial to the interest of the company. The Company js regular in repayment of deposits and there are no overdue.

(b) The company has granted unsecured loans, advances to the Companies, Firms and Parties listed in the Register maintained under section 301, The Total No. Of Parties are six and amount outstanding as on 31.03.2008 is Rs,36.90 lacs (Previous year Rs.43.65 lacs) and maximum outstanding is Rs.43.65 Lakhs.. According to the information and explanations given to us, the rate of interest and other terms and conditions of the loan are prima-facie, prejudicial to the interest of the Company.

(c) The debtors are not regular in repaying the principal amounts as stipulated and also irregular in payment of interest.

(d) In our opinion the company has not taken reasonable steps to recover the loan amount.

(iv) In our opinion and according to the information and explanations given to us, the internal control is not adequate 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 services. During the course of our audit, we have observed continuing failure to correct major weaknesses in internal controls

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

(b) in our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts of arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made but the reasonability of the prices having regard to prevailing market prices at that time cannot be ascertained.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits hence provisions of section 58A and 58AAof the Companies Act are not applicable to company except Business deposits and from directors and shareholders.

(vii) In our opinion, the company does not have Internal audit system commensurate with the size and nature of its business

(viii) As informed and explained to us, the Central Government has ordered for maintenance of cost records under section 209(1 )(d) of the companies Act vide order dated 16/03/2006 of the Central Government but the cost audit has not been completed till date,.

(ix) (a) The company is generally irregular in depositing with appropriate authorities undisputed statutory. dues including provident fund, investor education protection fund, ESIC, sales tax, incorporation TDS, service tax. Cess and other material statutory dues applicable to it including Excise Duty demand of Rs.114054/-which has not been paid till the period of Audit

x)According to the information explanations given to us and records company by us, the particulars of statutory dues as at 31/3/2003, which have not been deposited on account of a dispute, are as follows.

Name of the Nature of the Dues Amount under Forum where d -ispute is Statute dispute not yet pending deposited

Sales Tax 2002-2003 1,66,051 Final Demand Pending. Case in MPCT Remand 2002-2003 84,054/- Revision filed at Additional CST Commissioner of CT, Indore Stayed from H.C.

2004-05 Relevant doc. not Case remanded with made available instructions

Excise duty 2002-03 167530/- Stayed from High Court

Income Tax FY 1993-1994 1,42,130/- Rectification filed (A.Y 1994-95)

(x) The company does not have accumulated loss, as at tie end of year the company more than fifty percent of its net worth. The company has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us the company is in default of repayment of dues to financial institution/Bank as at 31.03.2003. however the same has been regularized later on.

xii) We are of the opinion that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) in our opinion, the company is not a chit fund or a nidhi t mutual benefit fund/society. Therefore, the provisions of clause 4 (xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xv) As informed and explained to us the company has not given guarantees for loans taken by others from ranks or financial institutions.

(xvi) The Company has applied the funds raised by way of term loans towards the purpose for which they have been raised.

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

(xviii) According to the informs-ion and explanations given to us the company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of tie Act,

xix) According to the information and explanations given to us, during the period covered by our audit ' report, the company had not issued any debenture.

(xx) The company has not made any Public issue of shares during the year. (xxi) According to the information and explanations given to us, no fraud on or by the company has been need reported curing the year.

PLACE: INDORE FOR Trilok Jain & Co.

Date: 01.03.2008 Chartered Accountants

bharat Jain)

Partner

M.NO. 77738