Auditor Report of Hiran Orgochem Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Hiran Orgochem Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, 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 management and Board of Directors of the Company are responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ('the act') with respect to 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 principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with rule 7 of Companies (Accounts) Rules, 2014. This responsibility includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; design, implementation and maintenance of adequate internal financial controls, thatare operating effectively for ensuring the accuracy and completeness of the accounting records, 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 orerror.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. 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 mis statement.

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 financial control relevant to the Company's preparation of the financial statements, that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls An audit . also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's management and Board of Directors, 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 on the financial statements.

Basis for Qualified Opinion

1. During the year, all the fixed assets of the company (except Motor Car) are sold by asset management company appointed by State bank of India, including the land & factory building due to company's inability to repay the loan. However, no documentary evidence so as to confirm the sale value was available with the company. Also, there are various legal cases pending against the company and its directors under SARFASEI Act, 2002 and Negotiable Instruments Act, 1881. So we are unable to comment on whether company can operate as going concern.

2. Company has exceeded the limit specified in Section 18 6 of Companies Act, 2013 as regards to lending money.

3. Company has not accounted for Foreign exchange gain / loss as required by Account Standard 11 relating to "Foreign Exchange Transactions".

4. Sales recognized by the company were not in conformity with the sales tax returns filed by the company. Sales as per books of accounts were 42.22 lakhs however sales as per returns filed by the company was Nil.

5. During the year Management has provided for doubtful loans and advances for Rs. 96.50 lacs. Company has also written off Short term loans and advances aggregating to Rs. 202.07 lakhs (net of loans and advances written back). We were not provided with any documentary evidence or basis on which management has relied and classified these loans as doubtful or writing it off.

6. Company has not appointed Chief Financial Officer and a whole time Company Secretary as on 31" March, 2015 as re'quired by Section 203 of Companies Act, 2013.

7. We have been informed that there are huge outstanding demands, disputed as well as undisputed, against the company with regards to Sales Tax, Income Tax, Excise Duty, Wealth Tax, etc. However, the necessary documentary evidences /information were not made available by the management. Hence we are unable to quantify the same. Loss of the Company is understated to that extent.

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 matters 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 in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at 31 st March 2015, its Loss and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters Specified in paragraphs 3 and 4 of the Order.

As required by section 143(3) of the Act, we further report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid financial statements comply with the applicable Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules 2014 except for Accounting Standard 11 relating to "Foreign Exchange Transactions";

e) On the basis of written representations received from the directors as on March 31,2015, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of Section 164(2) of the Act

f) In our opinion and to the best of our information and according to the explanations given to us, we report as under with respect to other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014:

i. The Company has not disclosed the full impact of pending litigations on account of Excise Duty, Income Tax, Sales Tax & other matters on its financial position in its financial statements.

ii. The Company did not have any long-term contracts including derivative contracts; as such the question of commenting on any . material foreseeable losses thereon does not arise

iii. The Company is yet to transfer unclaimed dividends outstanding for a period more than seven years aggregating to Rs. 4.22 lakhs to the Investor Education and Protection Fund.

Annexure referred to in our Report of even date to the members of Instant Holding Limited on the accounts of the company for the year ended 31 st March, 2015

On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of our audit, we report 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, all the fixed assets at factory were in possession of the asset reconstruction company (ARC) during the whole year and hence could not be physically verified. These assets were subsequently sold by the ARC. Other fixed assets have been physically verified by the management at regular intervals; as informed to us no material discrepancies were noticed on such verification;

ii. (a) The Physical verification of inventories have been conducted at reasonable intervals by the management;

(b) In our opinion and according to the information and explanation given to us, the procedures of physical verification of inventories followed by the management reasonable and adequate in relation to size of the company and the nature of its business.

(c) Company is maintaining proper records of Inventory and no material discrepancies found during the year.

iii. (a) The company has granted unsecured interest free loan to one company covered in the register maintained under section 189 of the Companies Act.

(b) In the case of loan granted to the party listed in the register maintained under section 189 of the Act, the loan is interest free and principal amounts , are being repaid regularly in accordance with the agreed contractual terms.

(c) There are no overdue amount of more than Rupees one lakh in respect of loans granted to the party listed in the register maintained under section 189 of the Act.

iv. In our opinion and according to the information and explanations given to us, there is no adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets and for the sale of services.

v. The Company has not accepted any deposits from the public covered under Section 73 to 76 of the Companies Act, 2013

vi. As informed to us, the Central Government has not prescribed maintenance of cost records under subsection (1) of Section 148oftheAct

vii. (a) According to the information and explanations given to us and based on the records of the company examined by us, the company is irregular in depositing the undisputed statutory dues, including Provident Fund, 'Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and other material statutory dues, as applicable, with the appropriate authorities in India;

According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were in arrears, as at March 31, 2015 for a period of more than six months from the date they became payable.

Name of Liabi lity Amount due for more than 6 months as on 31.03.2015

Service Tax . 2,29,503

Central Sales Tax 31,315

Professional Tax 9,575

Provident fund 16,774

Maharashtra VAT 1,38,87,577

Income Tax 46,44,378

Wealth Tax 7,554

Investor Education 4,22,543 and Protection Fund

(b) We have been informed that there are huge outstanding disputed demands, against the company with regards to Sales Tax, Income Tax, Excise Duty, Wealth Tax, etc. However, the necessary documentary evidences / information were not made available. Hence we are unable to quantify the same. Loss of the Company is understated to that extent.

(c) The Company is yet to transfer unclaimed dividends outstanding for a period more than seven years aggregating to Rs. 4.22 lakhs to the Investor Education and Protection Fund.

viii. The company does have accumulated losses at the end of the financial year and has incurred cash Josses in the financial year and in the immediately preceding financial year.

ix. The company examined by us and as per the information and explanations given to us, the company has defaulted in repayment of its dues to the banks and financial institutions and overdue position to financial institutions and banks are as under.

Name of Bank/ Amount Period of Institution Overdue Default

State Bank of Rs. 45,36,42,082 Loan has been India* recalled on 23.12.2011

State Bankof Rs. 15,42,88,358 Loanhasbeen Patiala recalled on 2.8.01.2012

SICOM Ltd. Rs. 2,83,90,199 Loan has been recalled on 23.01.2012

* Total outstanding 5,601.42 lakhs

Less: Amountmcovered from sellingoff all factory assets of the Company by the ARC (1,065.00 lakhs)

Net outstanding 4,536.42 lakhs

x. The Company has given corporate guarantee of Rs. 2700 Lacs in the earlier period and is continuing for the loans taken by Actgen Pharma Private Limited from Bank of India. The account of Actgen Pharma Private Limited with the bank has been classified as NPA w.e.f. 30.06.2013. Also, networth of Actgen Pharma Private Limited is completely erodedHowever, company is of the view that assets of Actgen Pharma Private Limited are sufficient to meet the liabilities of the bank and management does not foresee any development of their liability on the company.

xi. In our opinion, and according to the information and explanations given to us, the company has not raised any term loans during the year.

xii. We are unable to comment on occurrence of any material fraud on or by the Company due to lack of documentary evidence provided for our verification as envisaged above.

For MVK Associates Chartered Accountants Firm Reg. No: 120222W

Sd/-

CA. Kapil Gupta Partner Membership No.: 047911

Place: Mumbai Date : 30,hMay, 201 5

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Mar 31, 2014

We have audited the accompanying financial statements of Hiran Orgochem Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and 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

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred 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 Companies Act, 2013. 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 the entity''s internal controls. 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

1. Long term Investments of the company aggregating to 4.41 crores is in Actgen Pharma Private limited. Networth of Actgen Pharma Private Limited has completely eroded but the management is of the view that such diminution is of not permanent nature and hence provision for diminution in the value of investment is not provided. Losses more than twice its shareholders funds and provision for diminution in value of this assets has not been provided in the books of accounts.

2. During the year, State bank of India have taken physical possession of all the secured assets on 4th February, 2014 including the land & factory building due to company''s inability to repay the loan. And there are various legal cases pending against the company and its directors under SARFASEI Act, 2002 and Negotiable Instruments Act, 1881. So we are unable to comment on whether company can operate as going concern.

3. Company has exceeded the limit specified in Section 372A of Companies Act, 1956 as regards to lending money and also limits specified in Section 293 of Companies Act, 1956 as regards to borrowing money.

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 matters described in the Basis for Qualified Opinion paragraph, the financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:

* in the case of the balance sheet, of the state of affairs of the Company as at 31 March 2014;

* in the case of the statement of profit and loss, of the profit for the loss ended on that date;

* in case of cash flow statement, of the cash flow for the period 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, except for the effects of the matter described in the Basis for Qualified Report and note no. 35 to the financial statements, 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. we are able to determine 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, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956; read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of Companies Act, 2013; except Accounting Standard 11 relating to "Foreign Exchange Transactions" refer note 34 to financial statements.

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 Companies Act, 1956.



ANNEXURE TO THE AUDITORS'' REPORT

Referred in Paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements of our report of even date

1) a) The company has not updated fixed assets register including quantitative details and situation of fixed assets.

b) The Fixed assets has not been physically verified by the Management at reasonable intervals as the physical possession of all the fixed assets are taken by State Bank of India (lender) on 2ndFebruary, 2014.

c) During the period ended 31st March, 2014 lenders to the company has taken physical possession of all the fixed assets of the company. In our opinion the going concern status of the company is affected.

2) a) The stock in trade of has been physically verified by the Management. In our opinion having regard to the nature of stocks, the frequency of verification is reasonable.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of stock followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) In our opinion, the company has maintained proper records of inventory. No material discrepancies have been noticed on physical verification of stocks as compared to book records.

3) a) As informed to us, the company had granted unsecured loans to two parties covered in the register maintained under section 301 of the Act. In respect of the said loans, the maximum amount outstanding at any time during the year was Rs. 270.77 lakhs and the year-end balance is NIL.

b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of the loans given by the Company, are not prima facie prejudicial to the interest of the Company.

c) The loan amount is recoverable on demand.

d) In respect of the said loans, there are no overdue amounts.

e) The Company has taken unsecured loan from one party covered in the register maintained under section 301 of the Companies Act, 1956. In respect of the said loans, the maximum amount outstanding at any time during the year was Rs. 1,120.91 lakhs and the year-end balance is Rs 1,056.73 Lakhs.

f) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of the loans taken by the Company, are not prima facie prejudicial to the interest of the Company.

g) The loan amount is repayable on demand.

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

5) a) In our opinion and according to the information and explanation provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanation given to us, many of the items are of special nature and these prices cannot be compared with alternative quotations, the transaction exceeding the value of rupees five lacs in respect of any party made in pursuance of contract or arrangement entered in the register maintained under section 301 of the companies Act 1956 have been made at prices which are prima facie reasonable having regard to the prevalent market prices at the relevant time.

6) In our opinion and according to the information and explanations given to us the company has not accepted any deposits from the public within the meaning of section 58-A and 58-AA of the Act and the rules framed there under. Therefore, the provision of clause (vi) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the company.

7) We have been informed by the management that Company has its own internal audit system commensurate with its size and nature of business.

8) Cost records and accounts prescribed by the Central Government U/s 209(1)(d) of the Companies Act, 1956, if any, maintained by the company has not been produced for our verification.

9) a) The company is regular in depositing with appropriate authorities undisputed statutory dues including income tax, cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, the company is generally regular in depositing with appropriate authorities undisputed material statutory dues including Income Tax and other statutory dues and there are no undisputed statutory dues outstanding as at 31st March 2014, for a period of more than six months from the date they became payable except the following

c) According to the information and explanations given to us by the management following are the disputed statutory due in respect of various statues which have not been deposited. However the documentary evidences for the same have not been provided for our verification.

Name of The Nature of Amount Period To Forum Statute Dispute Which The Where Amount Dispute Relates Is Pending

Central Excise Differential Rs. 1,80,802 2006-2007 Assistant Act, 1944 Duty Commissioner, Surat.

Central Excise Classification Rs 18,99,400 2008-2009 Assistant Act, 1944 of exempted Commissioner, goods Surat.

Central Excise Classification Rs 2,60,318 2008-2009 Assistant Act, 1944 of exempted Commissioner, goods Surat.

Central Excise Classification Rs 26,63,584 2008-2009 Assistant Act, 1944 of exempted Registrar goods Tribunal, Ahmedabad

Central Excise Capital goods Rs 4,42,479 2011-2012 Deputy Act, 1944 Commissioner of Central excise & custom

Central Excise Input Service Rs. 30,62,910 2011-2012 Deputy Act, 1944 Tax Commissioner of Central excise & custom

Central Excise Service Tax Rs. 1,30,159 2006-2007 Assistant Act, 1944 Commissioner, Surat.

Maharastra Value Input VAT Rs. 5,95,320 2006-2007 Joint Added Tax Act, Credit Commissioner, 2002 Mumbai

Maharastra Value Input VAT Rs. 1,37,93,591 2008-2009 Joint Added Tax Act, Credit Commissioner, 2002 Mumbai

Maharastra Value Input VAT Rs. 3,67,00,884 2008-2009 Deputy Added Tax Act, Credit Commissioner 2002 of Sales Tax, Bandra

Maharastra Value Input VAT Rs. 2,12,05,142 2005-2006 Deputy Added Tax Act, Credit Commissioner 2002 of Sales Tax, Bandra

Central Sales Non Rs. 15,06,355 2005-2006 Deputy tax Act, 1956 submission of Commissioner C forms of Sales Tax, Bandra

Central Sales Non Rs. 1,81,20,896 2008-2009 Deputy tax Act, 1956 submission of Commissioner H/E1/C forms of Sales Tax, Bandra

Central Sales Non Rs. 5,85,76,068 2008-2009 Joint tax Act, 1956 submission of Commissioner, C forms Vadodara

Income Tax Act, Income Tax Rs. 2,66,990 2007-2008 Income Tax 1961 Demand Appelatte Tribunal

Income Tax Act, Income Tax Rs. 2,25,25,986 2010-2011 Commissioner 1961 Penalty of Income Tax

10) The company''s networth at the end of financial year has completely eroded. The Company has incurred cash loss during the financial year covered by our audit and also in the immediately preceding financial year.

11) According to the information and explanations given to us by the management, the company has defaulted in repayment of its dues to the banks and financial institutions and overdue position to financial institutions and banks are as under.

12) According to the information and explanations given to us and based on the documents and records produced before us, the company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures or other securities.

13) The Company is not a chit fund or a nidhi mutual benefit/society. Therefore, the provisions of clause 4(xiii) of the companies (Auditor''s Report) order 2003 are not applicable to the company.

14) In our opinion the company has maintained proper records and contracts with respect to its investments where timely entries of transactions are made in order. All investments at the close of the year are held in the name of the company.

15) The Company has given corporate guarantee of Rs. 2700 Lacs in the earlier period and is continuing for the loans taken by Actgen Pharma Private Limited from Bank of India. The account of Actgen Pharma Private Limited with the bank has been classified as NPA w.e.f. 30.06.2013. Also, networth of Actgen Pharma Private Limited is completely eroded. However, company is of the view that assets of Actgen Pharma Private Limited are sufficient to meet the liabilities of the bank and management does not foresee any development of their liability on the company.

16) As the company has not taken any term loan during the period, para 4 (xvi) of the order is not applicable.

17) The company has not raised any fund, long term or short term during the year.

18) The company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

19) According to the information and explanations given to us the company has not issued debentures during the year.

20) The company has not raised any money through a public issue during the year.

21) Based upon the audit procedures performed and information and explanations given to us, we are unable to report if any fraud on or by the Company has been noticed during the course of our audit as adequate documentary evidence were not made available.

For MVK Associates Chartered Accountants Firm Reg. No: 120222W

CA. Kapil Gupta Partner Membership No. : 047911

Place : Mumbai Date : May 30, 2014

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Jun 30, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Hiran Orgochem Limited (''the Company"), which comprise the Balance Sheet as at June 30,2013, and 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

Management is responsible for the preparation of these finagcial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3Q 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 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 atjune 30,2013;

b. inthecaseoftheStatementofProfrtandLoss,ofthe loss for the year ended on that date; and

c. in the case of the 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 (''the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

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

e. on the basis of written representations received from the directors as on June 30, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on June 30, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274oftheCompaniesAct, 1956.

f. Without qualifying our opinion, we draw attention to the following:

(i) Note No. 5(i) to 5(v) - State Bank of India, State Bank of Patiala and SICOM Ltd has recalled their loans during the previous year arid no provision for interest is made for the current period since amount is not quantified. Accordingly current year loss is understated to that extent;

(ii) Note No.10 (Hi) regarding investment in Actgen Pharma Private Limited of Rs. 441.00 lacs, we have relied on the management representation that there is no permanent diminution in the value of the investment and no provision is required as there is no permanent diminution in the value of the investment;

(iii)Note No.15(iii) regarding amount advanced against orders of Rs. 934.94 lacs in earlier years though unconfirmed, we have relied on the management representation as they consider the amount is good and recoverable and no provision is required.

Referred to in paragraph 3 of our report of even date on the accounts for the year ended 30th June 2013 of Hiran Orgochem Limited

1 (a) The company has not maintained proper records of fixed assets.

(b) All fixed assets have not been physically verified by the management during the year, however certain fixed asset were physically verified and we have been informed that no material discrepancies were noticed on such verification.

(c) No substantial part of Fixed Assets has been disposed off during the year, which has bearing on the going concern assumption.

2 (a) The stocks of finished goods, raw materials, work-in-process, stores and spare parts of the company have been physically verified by the management during the year.

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

(c) The discrepancies between the physical stocks and the book stocks were not material which have been properly dealt within the books of account

3 (a) As perthe information and explanation given to us and the records produced to us for our verification the company had obtained interest free unsecured loans from directors covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum outstanding amount of such loans during the year was Rs 14.95 Lacs and the year end outstanding balance is Rs 14.95 Lacs.

(b) The loans were at call and no stipulations had been made regarding payment of the principal and interest.

(c) The terms and conditions of the loans taken were prima facie not prejudicial to the interest of the company.

(d) The company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, comments regarding terms and conditions are not required.

4 In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and for 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 (a) In our opinion and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanations given to us, many of the items are of special nature and these prices cannot be compared with alternative quotations, the transactions exceeding the value of rupees five lacs in respect of any party made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are prima facie reasonable having regard to the prevalent market prices at the relevant time.

6 According to information and explanation given to us the company has not accepted the Deposits from publicduringtheyear.

7 We have been informed that company has its own internal audit system commensurate with its size and nature of business.

8 On the basis of information provided by the management and records produced, we are of the opinion that, prima facie, the cost records and accounts prescribed by the Central Government U/s 209(1 )(d) of the Companies Act, 1956 have been maintained by the company. However, we have not made a detailed examination of the cost records with a view to ascertain whether they are accurate or complete.

9 (a) In our opinion and according to the information and explanations given to us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales fax, Profession Tax, Wealth Tax, Custom Duty, Excise Duty, Cess, Service Tax and any other statutory dues have been delayed deposited during the year with the appropriate authorities and there are no undisputed statutory.

10 The company''s networth at the end of financial year has been completely eroded and have incurred cash losses in the current financial year and in immediately preceding financial year.

11 According-to the information and explanations given to us by the management, we are of the opinion that company has defaulted in repayment of its dues to the banks and financial institutions and overdue position to financial institutions and banks are as under.

12 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, debentures and other securities.

13 The company is not a chit fund or a nidhi/mutual benefit fund/society therefore, the clause 4 (xiii) of the Order is not applicable to the company.

14 In our opinion, the Company is not a dealer or trader in shares, securities, debenture and other investments.

15 The company has given corporate guarantee of Rs. 2700 Lacs in earlier period and is continuing for loans taken by M/s Actgen Pharma Private Limited from bank of India. The account of Actgen Pharma Private Limited with the bank has been classified as NPA w.e.f. 30.06.2013. However, management is of the view that assets of M/s Actgen Pharma Pvt Ltd are sufficient to meet the liabilities of the bank and management does not foresee any devolvement of their liability on the company.

16 DuringtheperiodcompanyhasnotobtainedanyTerm Loan.

17 On the basis of an overall examination of the Balance Sheet of the company, in our opinion and according to the information and explanations given to us, there are no funds raised on short-term basis have been used for long-term investment.

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

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

20 The company has not raised any money through a public issue during the year.

21 During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanation given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For And on Behalf of

MVK Associates

Chartered Accountants

Aniruddh Goyal

Place: Mumbai M.NO. 114851

Dated: 29.08.2013 FR N. No. 120222W

---

Jun 30, 2011

We have audited the attached Balance Sheet of HIRAN ORGOCHEM LIMITED, as at 30th June 2011 and also the Profit and Loss account for the year ended on that date annexed thereto and cash flow statement for the year ended on that date. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

2. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 (hereinafter referred to as the Act), we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said Order, to the extent applicable.

3. 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 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 Section 211 of the Companies Act, 1956;

e. On the basis of written representation received from the directors of the company as on 30th June, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th June 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

f. Without qualifying our opinion, we draw attention to note no. 7 of schedule -15 regarding export benefits of Rs. 119.18 Lacs and its consequential loss thereof if any and note no. 10 of schedule -15 regarding advance against orders of Rs. 2780.24 Lacs though unconfirmed, we have relied on management representation as they consider the amount is good and recoverable.

g. In our opinion and to the best of our information and according to the explanations given to us, the said Accounts, read together with the notes thereon and appearing in schedule of Accounting Policies and Notes on Accounts 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 30th June, 2011;

ii) In the case of the Profit and Loss Account, of the loss of the company for the year ended on that date, and

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

Referred to in paragraph 2 of our report of even date on the accounts for the year ended 30th June, 2011 of HIRAN ORGOCHEM LIMITED.

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

1. a) The company has not maintained proper records of fixed assets.

b) All fixed assets have not been physically verified by the management during the year, however certain fixed asset were physically verified and we have been informed that no material discrepancies were noticed on such verification.

c) No substantial part of Fixed Assets has been disposed off during the year, which has bearing on the going concern assumption.

2. a) The stocks of finished goods, raw materials, work-in- process, stores and spare parts of the company have been physically verified by the management during the year.

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

c) The discrepancies between the physical stocks and the book stocks were not material which have been properly dealt within the books of account.

3. a) As per the information and explanation given to us and the records produced to us for our verification the company had obtained interest free unsecured loans from three directors covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum outstanding amount of such loans during the year was Rs 56.65 Lacs and the year end outstanding balance is Rs 56.65 Lacs.

b) The loans were at call and no stipulations had been made regarding payment of the principal and interest.

c) The terms and conditions of the loans taken were prima facie not prejudicial to the interest of the company.

d) The company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the clause 4(iii)(b) to (d) of the order are not applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and for 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. a) In our opinion and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, many of the items are of special nature and these prices cannot be compared with alternative quotations, the transactions exceeding the value of rupees five lacs in respect of any party made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are prima facie reasonable having regard to the prevalent market prices at the relevant time.

6. The company has not accepted the Deposits from public.

7. We have been informed that the company has an internal audit system commensurate with its size and nature of business.

8. On the basis of information provided by the mangement and the records produced, we are of the opinion that, prima facie, the cost records and accounts prescribed by the Central Government U/s 209(1) (d) of the companies Act, 1956 have been maintained by the company. However, we are not required to carry out and have not carried out any detailed examination of such accounts and records.

9. a) In our opinion and according to the information and explanations given to us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Cess, Service Tax and any other statutory dues have been generally regularly deposited in time during the year with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 30th June, 2011 except income tax liability of Rs. 92.35 Lacs for assessment year 2010-11.

b) In our opinion and according to the information and explanations given to us, there are no dues outstanding in respect of Income Tax, Wealth Tax, Sales Tax, Custom Duty, Excise Duty, Cess and Service Tax on account of any dispute other than the following :-

Name Of The Nature Of Amount Statute Dispute

Central Excise Act, 1944 Differential Duty Rs. 1,80,802

Central Excise Act, 1944 Classification of Rs. 18,99,400 exempted goods

Central Excise Act, 1944 Classification of Rs. 40,03,740 exempted goods

Central Excise Act, 1944 Rebate of export duty Rs. 7,15,892

Maharastra Value Added Input VAT Credit Rs. 5,95,320 Tax Act, 2002

Maharastra Value Added Input VAT Credit Rs. 1,37,93,591 Tax Act, 2002

Income Tax Act, 1961 Income Tax Demand Rs. 4,80,259

Name of the Statute Period To Forum Where Which The Dispute Is Amount Relates Pending

Central Excise Act, 1944 2006-2007 Assistant Commissioner, Surat.

Central Excise Act, 1944 2007-2008 Assistant Commissioner, Surat.

Central Excise Act, 1944 2007-2008 Joint Commissioner Surat

Central Excise Act, 1944 2008-2009 Joint Commissioner New Delhi

Maharastra Value Added Tax Act, 2002 2006-2007 Joint Commissioner, Mumbai

Maharastra Value Added Tax Act, 2002 2008-2009 Joint Commissioner, Mumbai

Income Tax Act, 1961 2007-2008 Commissioner of Income Tax Mumbai

10. The companys accumulated losses at the end of financial year are more than fifty percent of its networth and have incurred cash losses in the current financial year. It has however not incurred cash losses in the immediately preceding financial year.

11. According to the information and explanations given to us, the companys overdue position to financial institutions or banks is as under.

S. N. Name of Bank/Institution Amount Overdue Period of Default

1 State Bank of India Rs. 77.47 Lacs Installment of May, 11 and June, 11

2 State Bank of Patiala Rs. 7.26 Lacs Installment of June, 11

3 Barclays Bank USD 2.43 Lacs Installment of April, 11 May, 11 and June, 11

12. 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, debentures and other securities.

13. The company is not a chit fund or a nidhi/mutual benefit fund/society therefore, the clause 4 (xiii) of the Order is not applicable to the company.

14. The company has maintained proper records of transactions and contracts in respect of dealing or trading in shares, securities, debentures and other investments and timely entries have been made therein. All shares, debentures and other investments have been held by the company in its own name.

15. The company has given corporate guarantee of Rs.2700 Lacs for loans taken by M/s Actgen Pharma Private Limited from banks. According to the information and explanations given to us, we are of the opinion that the terms and conditions of gurantee are not prima facie prejudicial to the interest of the company.

16. The company has obtained Term Loan from Sicom Limited and applied for the purpose for which the loan was taken.

17. On the basis of an overall examination of the Balance Sheet of the company, no funds raised on short-term basis have been used for long-term investment.

18. 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.

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

20. The company has not raised any money through a public issue during the year.

21. Based upon the audit procedures performed and on the basis of information and explanations provided by the Management, we report that no fraud on or by the company has been notice or reported during the course of our audit.

For And on Behalf of

Pachori & Associates

Chartered Accountants

Sd/-

S.V. Pachori, Partner

Place: Mumbai M.No. 33081.

Date: 12th August, 2011. F. R. No. 107219W

---

Mar 31, 2011

We have audited the attached Balance Sheet of HIRAN ORGOCHEM LIMITED, as at 30th June 2011 and also the Profit and Loss account for the year ended on that date annexed thereto and cash flow statement for the year ended on that date. 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.

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

2. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 (hereinafter referred to as the Act), we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said Order, to the extent applicable.

3. 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 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 Section 211 of the Companies Act, 1956;

e. On the basis of written representation received from the directors of the company as on 30th June, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th June 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

f. Without qualifying our opinion, we draw attention to note no. 7 of schedule -15 regarding export benefits of Rs. 119.18 Lacs and its consequential loss thereof if any and note no. 10 of schedule -15 regarding advance against orders of Rs. 2780.24 Lacs though unconfirmed, we have relied on management representation as they consider the amount is good and recoverable.

g. In our opinion and to the best of our information and according to the explanations given to us, the said Accounts, read together with the notes thereon and appearing in schedule of Accounting Policies and Notes on Accounts 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 30th June, 2011;

ii) In the case of the Profit and Loss Account, of the loss of the company for the year ended on that date, and

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

ANNEXURE TO THE AUDITORS' REPORT

Referred to in paragraph 2 of our report of even date on the accounts for the year ended 30th June, 2011 of HIRAN ORGOCHEM LIMITED.

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

1. a) The company has not maintained proper records of fixed assets.

b) All fixed assets have not been physically verified by the management during the year, however certain fixed asset were physically verified and we have been informed that no material discrepancies were noticed on such verification.

c) No substantial part of Fixed Assets has been disposed off during the year, which has bearing on the going concern assumption.

2. a) The stocks of finished goods, raw materials, work-in- process, stores and spare parts of the company have been physically verified by the management during the year.

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

c) The discrepancies between the physical stocks and the book stocks were not material which have been properly dealt within the books of account.

3. a) As per the information and explanation given to us and the records produced to us for our verification the company had obtained interest free unsecured loans from three directors covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum outstanding amount of such loans during the year was Rs 56.65 Lacs and the year end outstanding balance is Rs 56.65 Lacs.

b) The loans were at call and no stipulations had been made regarding payment of the principal and interest.

c) The terms and conditions of the loans taken were prima facie not prejudicial to the interest of the company.

d) The company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the clause 4(iii)(b) to (d) of the order are not applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and for 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. a) In our opinion and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.

b) In our opinion and according to the information and explanations given to us, many of the items are of special nature and these prices cannot be compared with alternative quotations, the transactions exceeding the value of rupees five lacs in respect of any party made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are prima facie reasonable having regard to the prevalent market prices at the relevant time.

6. The company has not accepted the Deposits from public.

7. We have been informed that the company has an internal audit system commensurate with its size and nature of business.

8. On the basis of information provided by the mangement and the records produced, we are of the opinion that, prima facie, the cost records and accounts prescribed by the Central Government U/s 209(1) (d) of the companies Act, 1956 have been maintained by the company. However, we are not required to carry out and have not carried out any detailed examination of such accounts and records.

9. a) In our opinion and according to the information and explanations given to us, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Cess, Service Tax and any other statutory dues have been generally regularly deposited in time during the year with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 30th June, 2011 except income tax liability of Rs. 92.35 Lacs for assessment year 2010-11.

b) In our opinion and according to the information and explanations given to us, there are no dues outstanding in respect of Income Tax, Wealth Tax, Sales Tax, Custom Duty, Excise Duty, Cess and Service Tax on account of any dispute other than the following :-

Name Of The Nature Of Amount Period To Forum Where Statute Dispute Which The Dispute Is Amount Relates Pending

Central Excise Act, 1944 Differential Duty Rs. 1,80,802 2006-2007 Assistant Commissioner, Surat.

Central Excise Act, 1944 Classifica -tion of Rs. 18,99,400 2007-2008 Assistant exempted goods Commissioner, Surat.

Central Excise Act, 1944 Classifica -tion of Rs. 40,03,740 2007-2008 Joint Commissioner exempted goods Surat

Central Excise Act, 1944 Rebate of export duty Rs. 7,15,892 2008-2009 Joint Commissioner New Delhi

Maharastra Value Added Input VAT Credit Rs. 5,95,320 2006-2007 Joint Commissioner Tax Act, 2002 Mumbai

Maharastra Value Added Input VAT Credit Rs.1,37,93,591 2008-2009 Joint Commissioner Tax Act, 2002 Mumbai

Income Tax Act, 1961 Income Tax Demand Rs. 4,80,259 2007-2008 Commissioner of Income Tax Mumbai

10. The company's accumulated losses at the end of financial year are more than fifty percent of its networth and have incurred cash losses in the current financial year. It has however not incurred cash losses in the immediately preceding financial year.

11. According to the information and explanations given to us, the company's overdue position to financial institutions or banks is as under.

S.N. Name of Bank/Institution Amount Overdue Period of Default

1 State Bank of India Rs. 77.47 Lacs Installment of May, 11 and June, 11

2 State Bank of Patiala Rs. 7.26 Lacs Installment of June, 11

3 Barclays Bank USD 2.43 Lacs Installment of April, 11 May, 11 and June, 11

12. 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, debentures and other securities.

13. The company is not a chit fund or a nidhi/mutual benefit fund/society therefore, the clause 4 (xiii) of the Order is not applicable to the company.

14. The company has maintained proper records of transactions and contracts in respect of dealing or trading in shares, securities, debentures and other investments and timely entries have been made therein. All shares, debentures and other investments have been held by the company in its own name.

15. The company has given corporate guarantee of Rs.2700 Lacs for loans taken by M/s Actgen Pharma Private Limited from banks. According to the information and explanations given to us, we are of the opinion that the terms and conditions of gurantee are not prima facie prejudicial to the interest of the company.

16. The company has obtained Term Loan from Sicom Limited and applied for the purpose for which the loan was taken.

17. On the basis of an overall examination of the Balance Sheet of the company, no funds raised on short-term basis have been used for long-term investment.

18. 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.

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

20. The company has not raised any money through a public issue during the year.

21. Based upon the audit procedures performed and on the basis of information and explanations provided by the Management, we report that no fraud on or by the company has been notice or reported during the course of our audit.

For And on Behalf of

Pachori & Associates

Chartered Accountants

Sd/-

S.V. Pachori, Partner

M.No. 33081.

F. R. No. 107219W

Place: Mumbai

Date:12th August 2011.

---

Mar 31, 2010

We have audited the attached Balance Sheet of HIRAN ORGOCHEM LIMITED, as at 31 March 2010 and also the Profit and Loss account for the year ended on that date annexed thereto and cash flow statement for the year ended on that date. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

2. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 (hereinafter referred to as the Act), we enclose in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said Order, to the extent applicable.

3. Further to our comments inthe 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 aud it;

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, 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 Section 211 of the Companies Act, 1956;

e. On the basis of written representation received from the di rectors of the company as on 31 * March, 2010 and taken on record by the Board of Directors, we report that none of the directors isdisqualified as on 31sMarch 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, subject to Note No.4 regarding non provision of doubtful debts of Rs. 64.85 lacs, read together with the notes thereon and appearing in schedule of Accounting Policies and Notes on Accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fai r view;

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

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

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

ANNEXURE TO THE AUDITORS REPORT

Referred to in paragraph 2 of our report of even date on the accounts for the year ended 31st March 2010 of HIRAN ORGOCHEM LIMITED.

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

1 .a) The Company has prima facie maintained proper records showing full particulars including quantitative details and situation of fixed assets upto 31st March 2002.The records for the subsequent years are not updated and prepared. All fixed assets have not been physically verified by the management during the year but there is a regular programme of periodical verification in a phased manner which, in our opinion, is reasonable having regards to the size of the company and the nature of its assets. As informed to us no material discrepancies were noticed on such verification.

b)No substantial part of Fixed Assets has been disposed off during the year, which has bearing on the going concern assumption.

2.a) The stocks of finished goods, raw materials, work-in- process, stores and spare parts of the Company have been physically verified by the management during the year.

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

c) The discrepancies between the physical stocks and the book stocks were not material which have been properly dealt with i n the books of accou nt.

3.a) As per the information and explanation given to us and the records produced to us for our verification the company had obtained interest free unsecured loans from two directors covered in the register maintained under Section 301 of the Companies Act, 1956 . The maximum outstanding amount of such loans during the year was Rs 8.84 lacs and the year end outstanding balance is Rs. Nil.

b) The loans were at call and no stipulations had been made regarding payment of the principal and interest.

c) The terms and conditions of the loans taken were prima facie not prejudicial to the interest of the company.

d) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the clause 4(iii)(b) to (d) of the order are not applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and for 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.a)ln our opinion and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained underthat section.

b) In our opinion and according to the information and explanations given to us, many of the items are of special nature and these prices cannot be compared with alternative quotations, the transactions exceeding the value of rupees five lacs in respect of any party made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 have been made at prices which are prima facie reasonable having regard to the prevalent market prices at the relevant time.

6. The Company has not accepted the Deposits from public.

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

8. On the basis of the records produced, we are of the opinion that, prima facie, the cost records and accounts prescribed by the Central Government U/s 209(1) (d) of the Companies Act, 1956 have been maintained by the Company. However, we are not required to carry out and have not carried out any detailed examination of such accounts and records.

9.a) In our opinion and according to the information and explanations given to us, undisputed statutory dues including Provident Fund, Investor* Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Cess, Service Tax and any other statutory dues have been generally regularly deposited in time during the year with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31s< March, 2010.

b) In our opinion and according to the information and explanations given to us, there are no dues outstanding in respect of Income Tax, Wealth Tax, Sales Tax, Custom Duty, Excise Duty, Cess and Service Tax on account of any dispute other then the following :-

NAME OF THE NATURE OF AMOUNT PERIOD TO STATUTE DISPUTE WHICH THE AMOUNT RELATES

Central Differential Rs. 1,80,802/- 2006-2007 Excise Act, 1944 Duty

Central Excise Duty Rs. 94,093/- 2009-2010 Excise Act, 1944

Central Classification Rs. 18,99,400/- 2008-2009 Excise Act, of Exempted 1944 Goods



NAME OF THE STATUE FORUM WHERE DISPUTE IS PENDING

Central Excise Act, 1944 Assistant Commissioner, Surat

Central Excise Act, 1944 Tribunal, Ahmedabad.

Central Excise Act, 1944 Assistant Commissioner, Surat.

10. The Company does not have accumulated losses as at the end of the financial year and has not incurred cash losses in the current financial year. It has however incurred cash losses in the immediately preceding financial year.

11. According to the information and explanations given to us, the Company has not defaulted in repayment of any dues to financial institutions or banks.

12. 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, debentures and other securities.

13. The Company is not a chit fund or a nidhi/mutual benefit fund/society therefore, the clause 4 (xiii) of the Order is not applicable to the Company.

14. The company has maintained proper records of transactions and contracts in respect of dealing or trading in shares, securities, debentures and other investments and timely entries have been made therein. All shares, Debentures and other investments have been held by the company in its own name.

15. The Company has given guarantees for loans taken by others from banks. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the company.

16. The Company has not obtained any new Term Loans during the year.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet no funds raised on short-term basis have been used for long-term investment.

18. 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.

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

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

21. Based upon the audit procedures performed and on the basis of information and explanations provided by the Management, we report that no fraud on or by the Company has been notice or reported during the course of our audit. *

FOR AND ON BEHALF OF

B. L. DASHARDA & ASSOCIATES

CHARTERED ACCOUNTANTS

B. L. DASHARDA, PARTNER M.NO. 13708. FRN. No. 112615W

Place :MUMBAI

Dated :29TH MAY, 2010