Thapar Ispat Ltd.की ऑडीटर रिपोर्ट

Jun 30, 2012

We have audited the attached Balance Sheet of M/s THAPAR ISPAT LIMITED as at 30th June, 2012 and the Profit & Loss Account and also .the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

01. We conducted our audit in accordance with the 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 statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

02. As required by the Companies (Auditor''s Report) Order, 2003 and Companies (Auditors Reports)(Amendment ) order 2004 issued by the Central Government of India in terms of sub-section 4(A) Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

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

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

(c) The Balance Sheet and 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 and Profit & Loss Account and cash flow statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

(e) On the basis of written representations received from the directors as on 30th June, 2010 and taken on record by the Board of Directors, we report that none of the Directors other than Nominee Director of PSIDC are prima facie as on 30th June, 2011, disqualified from being appointed as a Director in terms of clause (g) of sub-section(I) 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 financial statements read together with the Significant Accounting policies and other notes thereon give the information required by the Companies Act, 1956, and in the manner so required and give a true & fair view in conformity with the accounting principles generally accepted in India: (i) In the case of the Balance Sheet of the State of affairs of the company as at 30th June, 2012 and: (ii) In the Case of the Profit & Loss Account, of the profit/loss for the year ended on that date: and (iii) In the case of the cash flow state of the cash flows for the year ended on that date.

ANNEXURE TO AUDITORS REPORT

(REFERRED TO IN PARAGRAPH (2) OF OUR REPORT OF EVEN DATE ON THE STATEEMNT OF ACCOUNTS FOR M/s. THAPAR ISPAT LIMITED AS AT AND FOR THE YEAR ENDED 30th JUNE, 2012)

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

b) All Fixed assets have been physically verified by the management during the year. No material discrepancies were noticed on such verification.

c) The Company did not dispose off a substantial part of fixed assets during the year.

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

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

c) The company is maintaining proper records of inventory. The discrepancies notices on verification between the physical stocks and the books records were not material and were properly dealt with in the books of accounts.

3. a) The company has not granted loans secured or unsecured to companies, firms or other parties covered in the registered maintained under Section 301 of the Companies Act 1956. As the Company has not granted any loan secured or unsecured, to the parties listed in the register maintained under section 301 of the Companies Act, 1956, paragraph (iii)(a),(b),(c''),&(d) of order are not applicable.

b) The company has not taken loans secured or unsecured from companies, firm or other parties covered in the register maintained under Section 301 of the Companies Act 1956 as such paragraph (iii)(e),(f) & (g) of the order are not applicable.

4. In our opinion and recording 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 business, with regard to purchases of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5. There are no transaction that need to be entered into the register maintained under section 301 of the companies Act, 1956.

6. According to information & explanation given to us, the company has not accepted any new deposits as per Section 58 A of the Companies Act, 1956.

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

8. We have broadly reviewed the books of account maintained by the company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209{l)(d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However we have not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

9. a) According to information and explanation given to us, the company has been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employee''s state insurance, income tax, wealth tax, service tax, sale tax, customs duty, excise duty, and cess and other material statutory dues applicable to it.

b) According to information and explanation given to us, no undisputed amounts payable in respect of income tax, wealth tax, sale tax, service tax, customs duty, excise duty, and cess were in arrears, as at 30l June, 2012 for period of more than six months from the date they become payable.

c) According to the information and explanation given to us, the following are the particular of dues on account of income tax, wealth tax, service tax, sale tax, customs duty, excise duty, and cess which have not been deposited on account of any dispute.

Name of the Nature of dues Amount Period to which Forum where dispute statutory (Rs. amount relating pending in Lacs)

Indian Custom, Custom Duty 139.50 1999-2000 Joint Director General Act Interest & 2.00 2006-2007 of Foreign Trade, Penalty New Delhi

However liability in this regard has been provided.

10. The accumulated loss of the Company as at 30th June, 2012is not less than Fifty percent of its net worth. The Company has incurred cash losses for the year ended 30th June, 2012 and also in the immediately proceeding year.

11. According to information and explanations given to us and on the basis on examination of books of accounts the company has defaulted in repayment of dues of all the banks and financial institution. The information is as under:-

Name of Bank/Institutions Amount in Default (Rs.Lacs) Period of Default

Punjab & Sind Bank 95.88 1999-2000

Oriental Bank of Commerce 85.98 1999-2000

I.I.B.I. 1608.59 1999-2000

P.S.I.D.C. 4281.64 1999-2000

12. According to the information and explanations given to us the company has not granted any loans and advance on the basis of security by way of pledge of shares and other securities. Accordingly clause 4(XII) of the order is not applicable. 13. In our opinion, the company is not a chit fund or a nidhi / mutual benefit fond/society. Therefore, the provisions of clause 4(xiii) of the companies (Auditors Report) order, 2003 are not applicable to the company. 14. According to the information and explanations given to us the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly , the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the company. 15. In our opinion, and according to information and explanations given to us the company has not given guarantees for loans taken by others from banks or financial institutions. 16. In our opinion, and according to information and explanations given to us the term loans have been applied for the purpose for which they were raised. 17. 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 except permanent working capital. 18. According to the information and explanations given to us, the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year. 19. According to the information and explanations given to us, during the year covered by our audit report, the company has not issued any debentures. 20. There has not been any public issue during the year. 21. According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit. 22. The company is a Sick Industrial Company within the meaning of clause (o) of section (3) of the Sick Industrial Companies (Special Provisions) Act, 1985. The Company has reported that it has filed reference based on account for the year 2000-01 to 2010-11 and the same have been reportedly rejected by Honble BIFR and appeal against order of BIFR is pending before AAIFR. The reference based on accounts of 30.06.2010 has been registered with Hon''ble BIFR and hearing of the same is going on.

For VIMAL DIXIT & ASSOCIATES

CHARTERED ACCOUNTANTS Sd/-

(Vimal Kant Dixit)

PARTNER Place: Ludhiana

Date : 1/12/2012 Membership No: 078201

---

Jun 30, 2010

We have audited the attached Balance Sheet of M/s THAPAR ISPAT LIMITED as at 30th June, 2010 and the Profit & Loss Account and also the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

01. We conducted our audit in accordance with the 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 statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

02. As required by the Companies (Auditors Report) Order, 2003 and Companies (Auditors Reports)(Amendment) order 2004 issued by the Central Government of India in terms of sub-section 4(A) Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

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

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

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

(c) The Balance Sheet and 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 and Profit & Loss Account and cash flow statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

(e) On the basis of written representations received from the directors as on 30th June, 2010 and taken on record by the Board of Directors, we report that none of the Directors other than Nominee Director of PSIDC are prima facie as on 30th June, 2010, disqualified from being appointed as a Director in terms of clause (g) of sub-section(I) 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 financial statements read together with the Significant Accounting policies and other notes thereon give the information required by the Companies Act, 1956, and in the manner so required and give a true & fair view in conformity with the accounting principles generally accepted in India:

(i) In the case of the Balance Sheet of the State of affairs of the company as at 30th June, 2010 and:

(ii) In the Case of the Profit & Loss Account, of the profit/loss for the year ended on that date: and

(iii) In the case of the cash flow state of the cash flows for the year ended on that date.

ANNEXURE TO AUDITORS REPORT (REFERRED TO IN PARAGRAPH (2) OF OUR REPORT OF EVEN DATE ON THE STATEEMNT OF ACCOUNTS FOR M/s. THAPAR ISPAT LIMITED AS AT AND FOR THE YEAR ENDED 30th JUNE, 2010)

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

b) All Fixed assets have been physically verified by the management during the year. No material discrepancies were noticed on such verification.

c) The Company did not dispose off a substantial part of fixed assets during the year.

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

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

c) The company is maintaining proper records of inventory. The discrepancies notices on verification between the physical stocks and the books records were not material and were properly dealt with in the books of accounts.

3. a) The company has not granted loans secured or unsecured to companies, firms or other parties covered in the registered maintained under Section 301 of the Companies Act 1956. As the Company has not granted any loan secured or unsecured, to the parties listed in the register maintained under section 301 of the Companies Act, 1956, paragraph (iii)(a),(b),(c), & (d) of order are not applicable.

b) The company has not taken loans secured or unsecured from companies, firm or other parties covered in the register maintained under Section 301 of the Companies Act 1956 as such paragraph (iii)(e),(f) & (g) of the order are not applicable.

4. In our opinion and recording 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 business, with regard to purchases of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5. There are no transaction that need to be entered into the register maintained under section 301 of the companies Act, 1956.

6. According to information & explanation given to us, the company has not accepted any new deposits as per Section 58 A of the Companies Act, 1956.

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

8. We have broadly reviewed the books of account maintained by the company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209(l)(d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However we have not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

9. a) According to information and explanation given to us, the company has been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees state insurance, income tax, wealth tax, service tax, sale tax, customs duty, excise duty, and cess and other material statutory dues applicable to it.

b) According to information and explanation given to us, no undisputed amounts payable in respect of income tax, wealth tax, sale tax, service tax, customs duty, excise duty, and cess were in arrears, as at 30th June, 2010 for period of more than six months from the date they become payable.

c) According to the information and explanation given to us, the following are the particular of dues on account of income tax, wealth tax, service tax, sale tax, customs duty, excise duty, and cess which have not been deposited on account of any dispute.

Name of the Nature of dues Amount Period to which Forum where dispute statutory (Rs. amount relating pending in Lacs)

Indian Custom, Custom Duty 139.50 1999-2000 Joint Director General Act Interest & 2.00 2006-2007 of Foreign Trade, Penalty New Delhi

However liability in this regard has been provided.

10. The accumulated loss of the Company as at 30th June, 2010 is not less than Fifty percent of its net worth. The Company has incurred cash losses for the year ended 30th June, 2010 and also in the immediately proceeding year.

11. According to information and explanations given to us and on the basis on examination of books of accounts the company has defaulted in repayment of dues of all the banks and financial institution. The information is as under:-

Name of Bank/ Institutions Amount in Default(Rs.Lacs) Period of Default

Punjab & Sind Bank 95.88 1999-2000

Oriental Bank of Commerce 85.98 1999-2000

U.B.I. 1608.59 1999-2000

P.S.I.D.C. 4281.64 1999-2000

12. According to the information and explanations given to us the company has not granted any loans and advance on the basis of security by way of pledge of shares and other securities. Accordingly clause 4(XII) of the order is not applicable.

13. In our opinion, the company is not a chit fund or a nidhi / mutual benefit fond/society. Therefore, the provisions of clause 4(xiii) of the companies (Auditors Report) order, 2003 are not applicable to the company.

14. According to the information and explanations given to us the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly , the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the company.

15. In our opinion, and according to information and explanations given to us the company has not given guarantees for loans taken by others from banks or financial institutions.

16. In our opinion, and according to information and explanations given to us the term loans have been applied for the purpose for which they were raised.

17. 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 except permanent working capital.

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

19. According to the information and explanations given to us, during the year covered by our audit report, the company has not issued any debentures.

20. There has not been any public issue during the year.

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

22. The company is a Sick Industrial Company within the meaning of clause (o) of section (3) of the Sick Industrial Companies (Special Provisions) Act, 1985. The Company has reported that it has filed reference based on account for the year 2000-01 to 2008-09 and the same have been reportedly rejected by Honble BIFR and appeal against order of BIFR is pending before AAIFR.

For VIMAL DIXIT & ASSOCIATES CHARTERED ACCOUNTANTS

Sd/- PARTNER

Place: Ludhiana Date : 03/12/2010