Auditor Report of Kerala Ayurveda Ltd.

Mar 31, 2025

We have audited the Standalone financial statements of Kernln Ayurveda Limited (''the Company ).
which comprise the Balance Sheet as at 31st March, 2025 the Statement of Profit and Loss (including
other comprehensive income), the Statement of Changes in Equity and the Statement of Cash flows for
the year then ended and the notes to the financial statements, including a summary of significant
accounting policies and other explanatory information

In our opinion and to the best of our information and according to the explanations gi\en to us. except
for the possible effects of the matter described in the '' Basis for Qualified Opinion section the aforesaid
financial statements give the information required by the Companies Act 2013 ("the Act") in the manner
so required and give a true and fair \ icw in conformity with the Indian Accounting Standards prescribed
under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules. 20l5.as
amended. ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs
of the Company as at 31st March. 2025, its loss including comprehensive income, its cash flows and
the changes in equity for the y ear ended on that date

Basis for Qualified Opinion

The Company lias a bank account with HDFC Bank Limited hav ing a balance of ?3 85 lakhs as at 31st
March 2025, w hich is subject to confirmation and reconciliation In the absence of sufficient audit
evidence regarding the accuracy and completeness of this balance, we are unable to determine the
possible adjustments, if any. that may be required in respect of this item

We conducted our audit of the financial statements in accordance with the Standard of Auditing (SAs)
specified under section I43( 10) of the Act Our responsibilities under those SAs arc further described
in the Auditors Responsibilities for the Audit of the Financial Statements section of our report We are
independent of the Company in accordance with the Code of Ethics issued bv the Institute of Chartered
Accountants of India together w ith the ethical requirements that are relevant to our audit of the financial
statements under the prov isions of the Act and the Rules thereunder and we have fulfilled our ethical
responsibilities in accordance with these requirements and the ICAI’s Code of Ethics. We believe that
the audit ev idcncc vve hav e obtained is sufficient and appropriate to prov ide a basis for our opinion on
the financial statements.

Emphasis of Matters

I Wc draw attention to Note 43 to the financial Statements, relating to the restatement of prior
penod figures due to errors and omissions identified during the current reporting period Ilicsc
restatements have been made in accordance with Ind AS 8 Accounting Policies, Changes in
Accounting Estimates and Errors

2. We draw attention to Note 16 of the financial statements, relating to the significant trade
receivables due from the Company ''s subsidiaries A substantial portion of these balances has
been outstanding for more than 6 months Management has represented that these amounts are
fully recoverable and accordingly , no prov ision for expected credit loss has been recognised

Our opinion is not modified in respect of the above matters

Key audit matters

Key audit matters are those matters that, in our professional judgment, w ere of most significance in our
audit of the standalone financial statements of the current period These matters w ere addressed m the
context of our audit of the standalone financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters We have determined the matters
described below to be the key audit matters to be communicated in our report.

Restatement of prior period Financial Statements due to material error:

Key Audit Matter

How tlu* mutter was addressed in Audit

During the >car. the Companv has restated its comparative financial statements to coned certain material prior period errors The restatements primarilv relate to: ¦ Incorrect foreign exchange translation and restatement of balances denominated in foreign currencies. ¦ Inadequate impairment assessment of investments and loans extended to certain subsidiancs. and • Misclassification of certain financial assets and liabilities in the earlier periods. These restatements involved significant management judgment. retrospective adjustments, and reclassification of comparative financial information, all of which were material to users of the financial statements Given the nature, extent, and complexity of these restatements and the increased audit effort required to validate the adjustments, we considered this to be a kev audit matter

Our procedures included, among others • Obtaining a detailed understanding of the nature of the prior period errors and the Company''s restatement process. • Evaluating the Company''s internal documentation and management''s assessment supporting die restated figures. • Re-performing management''s calculations for ¦ Restatement of foreign currency balances and unrealised exchange gains/losses: ¦ Impairment testing of investments and inter-company loans based on recoverability: and ¦ Reclassification and measurement of financial instruments under applicable Ind AS (including Ind AS 109 and Ind AS 32) • Assessing whether the restated disclosures in the financial statements complv with the requirements of Ind AS X Accounting Policies. Changes in Accounting Estimates and Errors • Evaluating the appropriateness and completeness of the disclosures related to restated comparatives Reference in Financial Statements: Refer Note 43 Disclosures required under Ind AS Hfor correction of prior period errors.

Identification and disclosures of Related Parties:

Key Audit Matter	How the matter was addressed in Audit
The Companv has significant related party transactions, which include sale and purchase of goods and services, as well as lending, investment, and borrowing transactions with its subsidiancs. associates, joint ventures, and other related parties.	Our audit procedures included, among others: ¦ Evaluated the design and tested the operating effectiveness of controls over identification and disclosure of related part> transactions Identification and disclosure of related parties was a significant area of focus and hence is considered a Kev Audit Matter

Given the pervasive nature of these transactions.	• Obtained a list of related parties from the
the risk of incomplete identification.	Company s management and traced die
inappropriate classification and inadequate	related parties to declarations given bv
disclosure is heightened	directors, where applicable, and to Note 39 of the standalone Ind AS financial
Assessing compliance with Ind AS 24 Related	statements.
Party Disclosures requires significant	¦ Reviewed the minutes of the meetings of
management judgment, particularly in ensuring	the Board of Directors and Audit
completeness and accuracy of disclosures and	Committee and traced related partv
compliance with corporate governance	transactions with limits approved by
requirements.	Audit Committee / Board • Reviewed die declarations of related
Accordingly, related partv transactions were	partv transactions given to the Board of
considered a key audit matter	Directors and Audit Committee ¦ Verified the disclosures in the standalone Ind AS financial statements for compliance with Ind AS 24 Reference in Financial Statements Refer Note 39 Related Party Transactions

Testing for impairment of investments and loans advanced to subsidiary Companies:

Key Audit Matter	How the matter was addressed in Audit
The Company has invested in various	Our audit procedures included, among others.
subsidiaries and advanced significant loans to us	•	Reviewing the financial health of the
such entities, which are outstanding as at the		subsidiaries by examining their
balance sheet date. These investments and loans		audited/unaudited financial statements
form a substantial portion of the Company''s		and cash How forecasts
financial assets	¦	Obtaining a schedule of loans advanced
		to subsidiaries and verifying balances
The assessment of recoverability of loans and the		with underlying loan agreements.
valuation of these investments involves	•	Assessing the terms and conditions of the
significant management judgment This includes		loans, including tenure, interest, and
evaluating:		repayment clauses
• Die financial position and cash flow	¦	Evaluating the reasonableness of
projections of the subsidiaries.		management''s assessment of
• Die purpose and utilisation of the loans.		impairment including assumptions used
• Probability of repayment or		for calculating expected credit losses.
restructuring, and	¦	Reviewing the basis and documentation
¦ The fair valuation of investments in		for impairment provision recognised for
accordance with Ind AS requirements		the specific subsidiary loan
	¦	Assessing compliance with disclosure
Given die materiality of the amounts involved.		requirements under Ind AS 107. Ind AS
the related partv nature of the transactions, and		109, Ind AS 36 and Ind AS 24.
the judgment involved in assessing the	¦	Evaluating the adequacy and
impairment and recoverability, we considered		appropriateness of disclosures made in
this a kev audit matter		the financial statements.
	Reference in Financial Statements
	Refer Note 9 and 10 - Investments and hums to
	Subsidiaries

Information other than the standalone financial statements and auditor''s report thereon

The Company''s management and Board of Directors are responsible for the other information The
oilier information comprises the information included in the Company''s annual report, but docs not
include the financial statements and our auditor''s report thereon Hie annual report is expected to be
made available to us alter the date of this auditor''s report

Our opinion on the financial statements does not cover the other information and we do not express am
form of assurance conclusion thereon

In connection with our audit of the financial statements, our responsibility is to read the other
information and. in doing so. consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated If. based on the work we have performed, we conclude that there is a material misstatement
of this other information, we are required to report the fact We have nothing to report in this regard

Responsibilities of management and those charged with governance for the standalone financial
statements

The Company s Board of Directors is 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 including other comprehensive
income, and cash flows and changes in equity of the Company in accordance with the accounting
principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified
under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015. as
amended

This responsibility also includes maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding of 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 arc reasonable and prudent, and design, implementation and maintenance
of adequate internal financial controls, that were 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
or error.

In preparing the financial statements, management is responsible for assessing the Company s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the Board of Directors either intends to liquidate the Company
or to cease operations, or has no realistic alternative hut to do so

The Board of Directors is also responsible for overseeing the Company s financial reporting process.
Auditor’s Responsibilities for the audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor s report that
includes our opinion Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted m accordance with SAs will always detect a material misstatement when it exists
Misstatements can arise from fraud or error and are considered material if. individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these Financial Statements

As part of an audit in accordance with SAs. we exercise professional judgment and maintain
professional scepticism throughout the audit We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. Hie risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud mat involve collusion, forgery , intentional omissions, misrepresentations, or the
override of internal control

• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances Under section l43(3)(i)of the Companies
Act. 2013. we arc also responsible for expressing our opinion on whether the company has
adequate internal financial controls system in place and the operating effectiveness of such
controls,

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company s ability to continue as a
going concern If we conclude that a material uncertainty exists, we arc required to draw
attention in our auditor''s report to the related disclosures in the financial statements or. if such
disclosures arc inadequate, to modify our opinion Our conclusions are based on the audit
evidence obtained up to the date of our auditor''s report However, future events or conditions
may cause the Company to cease to continue as a going concern

• Evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation

Materiality is the magnitude of misstatements in the financial statements that, individually or in
aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the
financial statements may be influenced We consider quantitative materiality and qualitative factors in
(i) planning the scope of our audit work and in evaluating the results of our work, and (n) to evaluate
the effect of any identified misstatements in the financial statements

We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identity during our audit

We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably'' be thought to bear on our independence, and where applicable, related
safeguards

Report on Other Legal and Regulatory Requirements

1 As required by the Companies (Auditor’s Report) Order. 2020 ("the Order”), issued by the
Central Government of India in terms of sub-section (11) of section 143 of the Companies Act.
2013. we give in the "Anncxurc A" statement on the matters specified in paragraphs 3 and 4 of
the Order, to the extent applicable

2. As required by Section 143 (3) of die Act. we report that:

i) Wc have sought and obtained all the information and explanations which to the best of our
know ledge and belief were necessary for the purposes of our audit
it) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph
above, in our opinion, proper books of account as required b\ law have been kept by the
Company so far as it appears from our examination of those books
iii) The company docs not have an> branches which has not been audited by us and so
provisions of section I43(X) are not applicable to the company
i\) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive
income), the Statement of Changes in Equity and die Statement of Cash flows dealt with
b> this Report are m agreement with the books of account

v) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph
above, in our opinion, the aforesaid Financial Statements comply with the Indian
Accounting Standards specified under Section 133 of the Act read with Companies (Indian
Accounting Standards) Rules. 2015. as amended.

vi) On the basis of the written representations received from the directors as on 31st March,
2025 taken on record by the Board of Directors, none of the directors is disqualified as on
31st March. 2025 from being appointed as a director in terms of Section 164 (2) of the Act

mi) With respect to the adequacy of the internal financial controls over financial reporting of
the Company and the operating effectiveness of such controls, refer to our separate Report
in Annexure B’ Our report expresses a qualified opinion on the adequacy and operating
effectiveness of the Company‘s internal financial controls over financial reporting,
v in) In our opinion, the managerial remuneration for the year ended March 31. 2025 has been
paid / provided b\ the Company to its directors in accordance with the provisions of section
107 read with Schedule V to the Act,

ix) With respect to the matters to be included in the Auditor''s Report in accordance w ith Rule
11 of the Companies (Audit and Auditors) Rules. 2014. m our opinion and to the best of
our information and according to the explanation given to us:

i. The Company does not have any pending litigations which would impact its
financial position.

ii The Company did not have any long-term contracts including derivative contracts
for which there were any material foreseeable losses;
ni. There were no amounts which were required to be transferred to the Investor
Education and Protection Fund by the Company.
iv. n) The Management has represented that, to the best of its knowledge and belief,
no funds (which are material cither individually or in the aggregate) have been
advanced or loaned or invested (either from borrowed funds or share premium or
any other sources or kind of funds) by the Company to or in any other person or
entity, including foreign entity (“Intermediaries**), with the understanding, whether
recorded in writing or otherwise, that the Intermediary shall, whether, directly or
indirectly lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide
any guarantee, security or ihe like on behalf of the Ultimate Beneficiaries

b) rhe Management has represented, that, to the best of its know ledge and belief,
no funds (which are material cither individually or in the aggregate) have been
received by the Company from any person or entity, including foreign entity
(“Funding Parties’), with the understanding, whether recorded in writing or
otherwise, that the Company shall, whether, directly or indirectly, lend or invest in
other persons or entities identified ui any manner whatsoever by or on behalf of the
Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the
like on behalf of the Ultimate Beneficiaries;

c) Based on the audit procedures that have been considered reasonable and
appropriate in the circumstances, nothing has come to our notice that has caused
us to believe that the representations under sub-clause (i) and (ii) of Rule 11(c), as
provided under (a) and (b) above, contain any material misstatement

v Based on our examination which included test checks, the Company has used an
accounting software for maintaining its books of account for the financial year
ended 31 March 2025 which has a feature of recording audit trail (edit log) facility

and the same has operated throughout the year for all relevant transactions recorded
in the software Further, during the course of our audit and based on our test checks
we did not come across any instance of the audit trail feature being tampered with,
further, the C ompany has n system which ensures that the audit trail is preserved
by ihc Company as per ihc sLatuLory requirements for record retention,
vi. Since Ihc Company has nut dcclnred or paid any dividend dunng ili^ year, ihc
question of cum men Ling on whether dividend declared or piud is in accordance
with Section 123 of Ihc Companies Acl 2013 docs not arise.

For G Joseph <& Associates
Chartered Accountants
firm Keg. No. 00631 OS

Sd/-

UDIN 25233286BMIIBT4819 Raphael Sharon

Place: Hmakulam Partner

Date : 26.05.2025 233286

---

Mar 31, 2024

1. We have audited the accompanying standalone financial statements of Kerala Ayurveda Limited ("the Company”), which comprise the Balance Sheet as at March 31,2024 , the Statement of Profit and Loss (Including other Comprehensive Income), the Cash Flow statement and the statement of changes in equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (Act) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including Indian Accounting Standards (‘Ind AS’) specified under section 133 of the act , of the state of affairs (financial position ) of the Company as at March 31,2024 and its Loss (financial performance including other Comprehensive Income) , its cash flows and the changes in equity for the year ended on that date.

Basis of Opinion

3. We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (‘ICAI’) together with the ethical requirements that are relevant to Our audit of the financial statements under the provisions of the Act and the Rules there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

4. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the financial year ended March 31,2024. These matters were addressed in the context of our audit of the standalone financial statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

Risk Description	Our Response
Refer to Note 10 to these Financial Statements. The total Inventories as of March 31, 2024 amounted to ^ 1311.93 lakhs representing 10.58 % of the total assets (2023: ^ 967.53 Lakhs 9.80 %	Our audit procedures included: • Challenging the management with regard to the calculation methodology, the basis for provision and the process with respect to inventory provision.
of the total assets) The Company has significant levels of inventories and significant management judgments are taken with regard to categorization of inventories into obsolete and/or slow moving and which should be therefore be considered for provision. Estimates are then involved in arriving at provisions against cost in respect of slow moving and obsolete inventories to arrive at valuation based on lower of cost and net realizable value.	• Testing the design, implementation and operating effectiveness of the key controls management has established for provision computations and to ensure the accuracy of the inventory provision. • Assessing the adequacy of, and movements in, inventory provisions held, by recalculating a sample of items included within the provision to ensure appropriate basis of valuation.
Given the level of significant management judgments and estimates involved this is considered to be a key audit matter	• Evaluating, on a sample basis, whether inventories were stated at the lower of cost or net realizable value at the reporting date by comparing the sales prices of inventories subsequent to the reporting date.
	• Evaluating the appropriateness of the assumptions used based on our knowledge and information of the client and the industry.

5. The Company’s Board of Directors are responsible for the other information. The other information comprises the information included in the Management report, Chairman’s statement, Director’s report etc but does not include the standalone financial statements and our auditor’s report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

6. The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs (financial position) , Loss ( financial performance including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted In India, including the Indian Accounting Standards specified under section 133 of the Act .This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of 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; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

7. In preparing the standalone financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

8. Those Board of Directors are also responsible for overseeing the Company’s financial reporting process.

9. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

10. As part of an audit in accordance with Standards on Auditing , we exercise professional judgment and maintain professional skepticism throughout the audit. we also:

• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the act , we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

11. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

12. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them

all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

13. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

14. As required by the Companies (Auditor’s Report) Order, 2020 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, a statement on the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.

15. Further to our Comments in Annexure A, as required by section 143(3) of the Act, We 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 it appears from our examination of those books

c. The standalone financial statements dealt with by this report are in agreement with the books of accounts

d. In our opinion, the aforesaid standalone financial statements comply with Ind AS specified under Section 133 of the Act

e. On the basis of the written representations received from the directors and taken on record by the board of directors, none of the directors is disqualified as on March 31, 2024 from being appointed as a director in terms of Section 164(2)of the Act.

f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

g. In our opinion, the managerial remuneration for the year ended March 31, 2024 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;

h. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i) the Company does not have any pending litigations which would impact financial position

ii) the Company does not have any long-term contracts requiring a provision for material foreseeable losses.

iii) The Company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

iv) a) The management has represented that, to the best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

b) The management has represented, that, to the best of its knowledge and belief, no funds have been received by the company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

Based on such audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to my notice that has caused me to believe that the representations under sub-clause (i) and (ii) of Rule 11 (e) as provided under (a) and (b) above , contain any material misstatement.

v. The company has neither declared nor paid any dividend during the year.

vi. Based on our examination, which included test checks, the Company has used accounting softwares for maintaining its books of account for the financial year ended March 31, 2024 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the softwares. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1,2023, reporting under Rule 11 (g) of the Companies (Audit and Auditors) Rules,

2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.

1. As required by the Companies (Auditor’s Report) Order, 2020 (the “Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

For Maharaj Rajan and Mathew Chartered Accountants

Firm Registration Number 001932S

Mathew Joseph B.com ,FCA,DISA(ICA) Ernakulam ( Partner)

29/05/2024 Membership Number 022658

UDIN: 24022658BKAJVW7853

---

Mar 31, 2023

T. we nave audited ine accompanying stamaiwy financial EUemenB or Kerala Ayurveoa Limned (tub Company"), which compiisc trie flalance Snctl as at March 31, 2023 , (tie Statement of Profit antf Loss (I rtchudi i ly other Comprehensive Income), the Cash I idw statement and the statement of changes fit equity fur the year then ended, end a summary of Utc significant accounting policies and other explanatory information.

2. In eur opinion and te the best ef oui infbntialkjn and decoding le the cuptanaHocrs given to us, the aforesaid standalone financial statements give the information required by the Companies Ad, 2013 (Ad) m Eire manner so enquired and give a true and fair view ipi conformity with the accounting principles generally accepted m India including Indian Accounting Standards find AS) specified under section 133 of the act, of trie stale ef affairs (financial position ) of Ific Company as at March 31, 21)23 and its profit (flnancral performance including otfiei Comprehensive income) its cash flews and the changes in equity for tiro year ended on that dale.

Oasis of Opinio ri

3. We conducted our audit m accordance with the Standards on Auditing specified under section 143(10} of the Act Our responsibilities under those Standaids arc further described in Ihe Auditor''s Responsibilities fot the Audit of the standalone financial Slatomenls section of our report. We are independent of the Company rn accordance with the Code of Ethics issued by the Instilule et Cliartcred Accountants ef India (''ICAI") together with Ihe ethical loquironohls that are relevant to Our audit of the financial statements under the previsions of the Act and the Rules there under, and we have fulfilled cur other ethical responsibilities nr accordance with tlicsc requirements and Ihe Code of Ethics. We believe that the audit evidence we have obtained is su/cicnt and appropnale to provide a basis for our opinion.

Key Audi! Matters

4. Key audit matters arc If rose mailers that, in our profcssfonal judgment, wore of mosl significance m our audit of the standalone financial statements for Ihe financial year ended March 31, 2023. These mailers were addressed nr the context of our audit of Ihe standalone financial statements as a whole and in forming eur opinion thereon and we do nel provide a separate opinion on these matters. We have determined Ihe manors described bclew to he the hey audit matters tu be cormnur ucated m our report.

Key Audit Matter

Auditor''s Response

Existence and impairment of Trade Receivables . Refer to note 11, Trade Receivables te the standalone financial statements. The total fiadc Receivables as of March 31,2023 amounted to RS1207.36 lakhs representing 12.3(1 % of (he total assets (2022. RS 1036.16 Lafchs 11.30% of die total assets) Trade Receivables are significant te the Company''s financial statements. The Colloctabilily ef fiadc recorvabtos is a key element of llic company''s working capital management, which is nranaged on an ongoing basis by its management. Due te the nature of Ihe Business and the requirements of customers, venous contract terms aie in place, there is a nsk that Ihe carrying values may not reflective of then recoverable amounts as a! Lhc reporting date, which would require an imparmnenl provision. Whore there are indicators of impairment, Ihe company undertakes assessment of the recoverability of the amounts. Given the magnitude and inherent uncertainty involved in the judgment, involved in estimating impairment assessment of trade receivables, we have identified tins as a key audit mailer.

Principal Audit Procedures Wo performed audit procedures on the assessment of trade receivables, which included substantive testing of revenue transactions, obtaining trade loccivabte external confirmations and testing the subsequent payments received. Assessing the impact of impairment on bade receivables requires judgment and we evaluated management''s assumptions in determining the provision for impairment of trade receivables, by analyzing too ageing of receivables, assessing Significant overdue individual trade receivabtos and specific Local risks, combined with Ihe legal documentations. whereapjJlicabfc. Wc also reviewed (tic system of obtaining periodical confirmation from the customers. Wc tested Ihe liming ef revenue and trade receivables recognition based on fie ternis agreed with the customers. We also reviewed, on a sample basis, terms of the contract with the customers, invoices raised, etc., as a part of cur audit procedures. Furthermore we assessed the adequacy and appropriateness of Ihe disclosures in the separate financial statements..

Information Other than the Standalone Financial Statements and Auditor''s Report Thereon

5. The Company''s [foard of Directors is responsible for the other information. Ihe olher information composes the information mdudod in Ihe Management report, Chairman''s statement. Director''s report etc but does not include the standalone financial statements and our auditor''s report thereon

Oui opinion on the standalone financial statements does not cover Ihe other information and we do nel express any form of assurance conclusion thereon.

in connection with our audit of the standalone financial statements, our responsibility is to read Ihe other mfotmaben and, in doing so, consider whether the otliei information is inalcually inconsistent with mo standalone financial statements or out Knowledge obtained in the audit or otherwise appears to bo materially misstated, if, based on Ihe wurk wo have performed, we conclude that there is a malcnal misstatement of this other infetmalion, we are required te report that fact. We have jiolhrng to report in this regard.

Responsibilities oF Management and Those Charged with Governance for the Standalone Financial Statements

6,Thc Company’s Board of Directors is responsible for mo matters slated in Section 134(5J of me Act with respect to the props ration of these standalone financis I statements (fiat give a true and fair wcw of the slate of a Tars (financial position) . profit ( financial performance inducting dha comprehensive income) changes in equity and cash flews of the Company hl accordance with the accounting principles generally aocopted In India, including trie Indian Accounting Stands ids specified under section 133 of the Act .tins responsibility ataj includes maintenance of adequate accounting records in accordance with the provisions of the Ad for safeguarding of the assets of the Company and for preversing and detecting frauds arid other irregularities, selection and application of appropriate accounting policies, making judgments and estimates trial are reasonable and prudent, and design. implcmenlatioii and fnaMerianca of adequate interna I financial controls, that were operating ulectivcly for ensunng the accutacy and completeness of the accounting records, relevant to Uic preparation and prcscmlalkm Ihe standalone financial statements that gwe a true and fail view and are free from material misstatement, whether due lo fraud or error.

r.ln preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concurn and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or -has no realistic alternative but to do so.

8 .Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

Auditor''s Kcspunsibilitics for the Audit el the standalone Financial Statements

9.Our objectives are to obtain reasonable assurance about whether the standalone financial statement! as a whole are free from material misstatement, whether due to fraud or error, and lo issue an audrier''s leporf that mcludes our opinion. Reasonable assurance Is a high level of assurance, but is not a guarantee that an audit conducted m accordance with Standards on auditing wil always delect a material miss talon wit when it exists. Misstatements can arise from fraud or eiror and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken en the basis of these standalone financial statements.

10. As part of an audit rn accordance with Standards an Auditing , we exorcise professional judgment and maintain professional skepticism throughout the audit, we also:

- Identity and assess the risks of malarial misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain and if evidence that is suddent and appropriate to provide a basis for our opinion. The risk of nol delecting a material nnsekiLerocnt resulting from fraud is higher than fur one resulting from error, as fraud may involve col listen, forgery, intentional emissions, misrepresentations, or the override ef internal control.

¦ Obtain an understanding of internal control relevant lo the audit in order to design audit procedures that arc appropriate in the circumstances. Under section I43(3)(t) of the ad , we ate also responsible for expressing our opinion an whether the company has adequate ndenial financial controls system m place and (he operating effectiveness of such controls.

* Evaluala Itic appropriateness ef accounting policies used and the reasonableness ef accounting cslimales and related disclosures made by management.

- Conclude an the appropriateness of management''s use ef ttie going concern basis ef accounting and. based on the audit evidence obtained, whafier a material unccilainly exists related to events or coriditions that may cast significant doubt on the Company''s ability lo continue as a going concern, if we conclude Dial a material uncertainty exists, we are required lo draw attention in out auditor''s report lo the refuted disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up te ttie date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern

- evaluate the overall presentation, structure and content of the standalone financial statemente, including the disclosures, and whether tile standalone financial slatemoncs represent the underlying transactions and events in a inanner that achieves fair presentation.

11. We communicate with these charged with governance regarding, among oilier matters, Ibc planned scope and timing ef ttie audit and significant audit findings, including any significant deficiencies in internal control: lhal we identity during our audit.

12. We also provide those charged with governance with a statement that we have complied with rcfcivanL ethical requirements regarding independence, and to communicate with them all relationships and uttier mailers Lhal may reasonably be thought lo bear on our independence, and where applicable, retailed safeguards.

13. From Elm matters communicated with tirosc changed Aim governance, we determine Ihose mailers trial were of most significance m Ihe audit of (Tie standalone financial statements of tine current pence and are therefore the hey audit matters. We describe these manors in our auditors'' report unless law or regulslion precludes public disclosure about (he matter or whan, in extremely ram circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doirtg so would reasonably bo expected to outweigh the public interest benefits of such comma mcaliori.

Report cm Other Legal and He gu I a lory Requirements

14. As required by the Companies (Auditor''s Ftepoit) Order, 2020 issued by the Central Gowjmmcnt of India in terms of subsection (11) of section 143 of tfie Act, wd give m the Annoxure A, a statement on Ihe matters specified in paragraphs 3 and 4 of Ihe Order lo Ihe extent applicable.

15. Furthcr to our Commcnls m Annexure A, as required by section 143(3) of the Act, We report that:

a. We halve sought and obtained all Ihe information and explanations which lo the best of our knowledge and belief wore necessary for the purpose of our audit:

b. In ou r opinion proper books ef account as required by law have been kept by Vie Company so fa r as it appears from our examination of those books

c. The standalone fin uncial statements dealt with by tins report are in agreement with the books of accounts

d. In out opinion, the aforesaid standalone financial statements comply with Jnd AS speci tied under Section f33oftfie Ad

c. On the basis of the written representations received from the directors and taken on accord by trie beard of directors, none of Ihe directors is di&qualilied as on March 31, 2023 from being appointed as a director in terms of Section l64(2)of the Act.

f. With respect to the adequacy of the internal financial conlrols over financial reporting of ttie Company and the operating effectiveness of such controls, refer to cur separate Report in ''Amexura

m.

g. In our opinion, Ihe managerial remuneration for the year ended March 31, 2023 has been paid I provided by tlie Company to its directors in accordance with the provisions erf section 197 read with Schedule V lo the Act;

h. Wilh respect to Ihe otfioi matters lo bo included in the Auditor''s Report in accordance wilh Rule 11 of the Companies (Audit and Auditors) Rutes, 2014, m our opinion and lo Ihe best of ou( information and according to ihe explai lafions given to us.

i)lhc Company does net have any pending litigations which would impact its financial position

njthe Company dees not have any tong term contracts requiring a provision for material foreseeable tosses.

m}The Company does not have any amounts required to be transferred lo he Investor Lducalien and Protection Fund.

iv) a) ''l he managemcnl has represented lhal. to the best of ils knowledge and belief, no funds have boon advanced or leaned or invested (crthoi from borrowed funds or share premium or any olher sources or kmd of funds) by tic company lo or in any other personas) or ontily(ies), including foreign entities (“Intermediaries''), with ihe understanding, whether recorded in writing or otherwise, that Ihe Intermediary shall, whether, directly or indirectly lend or invest in other poisons or entities identified in any manner whatsoever by or on behalf of the company (‘Uftimate Beneficiaries'') or provide any guarantee, security or Ihe like an behalf of the Ultimate Beneficiaries.

b) The management has represented, that, lo the best of ils knowledge amt belief, no funds have been received by Ihu company front any pcrson(s) or onlilrfies), including foreign entities (‘Funding Parties''), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or err behalf of the Funding Party f Ultimate Beneficial o*n or prnvide any guarantee, security or Ihe like on behalf of Ihe Ultimate Beneficiaries, and

c) Liu sod un such audit pflxsAires that have been (xmetdtvad reasonable and appropriate in the circumstances, nothing lias come to my notice that has caused mo to believe dial (tie representations under sub-clause (i) and (u) of Rule 11 (e) as provided under (a) arid fbi above , contain any material misstatement.

v} The company has neither declared nor patd any dividend during tftc year.

vi. Since foc|uircmeiril of maintenance of accounting software which has a feature of audit trait under Rule 3 of the Companies (Accounts) Rules, 2G14 has been deferred from financial year commencing from 01 Aptrl 2022 to financial year t»mmeriting from 01 Apnl 2023, reporting under Rule 11(g)- of Companies (Audit and Auditors) Rules. 2014 is not applicable for the financial year ended 31 March 2023.

fbr Mullyraj Rujun and Mathew Chartered Accountants firm Reg i strati or Number 001932S

Mathew Joseph ticom >CA,DlSA[lCA)

Lmahutam (Partner)

3D.iJ5.''''2riZJ Membership Number D2265E

UDIN: 23D22B5BliGWDNWaa4a

---

Mar 31, 2018

Independent Auditor''s Report

To

The Members of Kerala Ayurveda Limited.

Report on the Standalone Financial Statements.

We have audited the accompanying standalone financial statements of Kerala Ayurveda Limited (''the Company''),which comprise the Balance Sheet as at SI^March^OI 8, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Cash Flow Statement for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (''the Act'') with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (''Ind AS'') prescribed under Section 133 of the Act.

This responsibility also 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; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone 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 standalone financial statements based on our audit.

In conducting 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 there under

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 these standalone financial statements are free from material misstatement.

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 including Ind AS specified under Section 133 of the Act, of the state of affairs of the Company as at 31st March 2018, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order,2016 (''the Order'') issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the ''Annexure A''a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act, we 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 it appears from our examination of those books;

c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, the aforesaid standalone financial statements comply with Ind AS specified under Section 133 of the Act;

e) On the basis of the written representations received from the Directors and taken on record by the Board of Directors, none of the Directors is disqualified as on 31 March, 2018 from being appointed as a Director in terms of Section 164(2) of the Act;

f) With respect to the adequacy of the Internal Financial Controls over Financial Reporting of the Company and the operating effectiveness of such controls, referto our separate report in ''Annexure B''.

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

I) the Company does not have any pending litigations which would impact its financial position:

ii. the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses and;

iii. The Company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

	For Biju George & Co
	Chartered Accountants
	Firm''s Registration No. 007920S
	Sd/-
Place: Bengaluru	Biju George
Date: May 30,2018	Proprietor Membership No. 206233

Annexure A

Annexure A to the Independent Auditor''s Report of even date to the members of Kerala Ayurveda Limited, on the standalone financial statements for the year ended 31 March, 2018

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

(b) The company has a program of verification to cover all the items of fixed assets in a phased manner which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the management during the year. According to the information and explanation given to us, no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii) As explained to us, Physical verification of inventory has been conducted at reasonable intervals by management and discrepancies noticed on such verification between physical stocks and book records were not material considering the operations of the company and the same have been properly dealt with in the books of account of the company.

(iii) According to the information and explanations given to us, the Company has granted unsecured loans to subsidiaries covered in the register maintained under Section 189 of the Act, in respect of which

a) The terms and conditions of the grant of such loans are, in our opinion, prima facie, not prejudicial to the company''s interest.

b) The Schedule of repayment has been stipulated for the loans granted and repayments are regular.

c) There are no overdue amount remaining outstanding as attheyear-end

iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of the section 185 and 186 of the Act in respect of grant of loans, making investments and providing guarantees and securities, as applicable.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of ClauseS(v) of the Order are not applicable.

(vi) 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 Sub Section (1) of Section 148 of the Act in respect of Company''s products/services and 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 cost records with a view to determine whether they are accurate or complete.

(vii) (a) Undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited to the appropriate authorities, though there has been a slight delay in a few cases. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

viii) The Company has not defaulted in repayment of loans or borrowings to any bank or financial institution or government during theyear. The Company did not have any outstanding debentures during the year.

(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments). In our opinion, the term loans were applied for the purposes for which the loans were obtained.

(x) To the best of our knowledge and according to the information and explanation given to us no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.

(xi) In our opinion and according to the information and explanations given to us, the Company has paid /Provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct.

(xii) The Company is not a Nidhi Company and hence reporting under Clause 3(xii) of the Order is not applicable to the Company.

(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with Sections 177 and 188 of the Companies Act 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards.

(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures and hence reporting under Clause 3 (xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to us, during the year, the Company has not entered into any non-cash transactions with its Directors or persons connected to its Directors and hence reporting under Clause 3 (xv) of the Order is not applicable to the Company.

(xvi) The Company is not required to be registered under Section 45-I A of the Reserve Bank of I ndia Act, 1934

Annexure B

Annexure B to the Independent Auditor''s Report of even date to the members of Kerala Ayurveda Limited on the standalone financial statements for the year ended 31 March, 2018

Independent Auditor''s report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the Internal Financial Controls over Financial Reporting of Kerala Ayurveda Limited ("the Company") as of March 31,2018 in conjunction with our audit of the standalone financial statements of the Company forthe year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company''s Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of the Company''s business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act 2013.

Auditors'' Responsibility

Our responsibility is to express an opinion on the Internal Financial Controls over Financial Reporting of the Company based on our audit. We conducted our audit in accordance with the Guidance note on audit of internal financial controls over financial reporting(the Guidance note) issued by The Institute of Chartered Accounts of India and the standards on Auditing prescribed under Section 143(10) of the Companies Act 2013, to the extent applicable to an audit of Internal Financial Controls . Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate Internal Financial Controls over Financial Reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the Internal Financial Controls system over Financial Reporting and their operating effectiveness. Our audit of Internal Financial Controls over Financial Reporting included obtaining an understanding of Internal Financial Controls over Financial Reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s Internal Financial Controls system over Financial Reporting.

Meaning of Internal Financial Controls over Financial Reporting

A Company''s Internal Financial Controls over Financial Reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s Internal Financial Controls over Financial Reporting include those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of Management and Directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of Internal Financial Controls over Financial Reporting , including the possibility of collusion or improper Management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the Internal Financial Controls over Financial Reporting to future periods are subject to the risk that Internal Financial Controls over Financial Reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanation given to us the Company has, in all material respects, an adequate Internal Financial Controls system over Financial Reporting and such Internal Financial Controls over Financial Reporting were operating effectively as at 31 March, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on audit of internal financial controls over financial reporting issued by the Institute of Chartered Accountants of India.

---

Mar 31, 2016

To

The Members of

KERALA AYURVEDA LIMITED,

Report on the Standalone Financial Statements

We have audited the accompanying Standalone Financial statements of Kerala Ayurveda Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2016 , the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone 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 the Companies (Accounts) Rules, 2014. This responsibility also 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; and design, implementation and maintenance of adequate internal financial controls that were 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 or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these Standalone 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 there under.

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 misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s 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. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s 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 standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 31st March, 2016, and its profit and its 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, 2016(“the order”), issued by the Central Government of India in terms of Sub-section (11) of Section143 of the Act, we give in the Annexure B, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143(3) of the Act, we 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 it appears from our examination of those books.

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

d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of the written representations received from the directors as on 31^st March, 2016 and taken on record by the Board of Directors, none of the directors is disqualified as on 31^st March, 2016 from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in “Annexure A” and

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

(i ) The Company does not have any pending litigations which would impact its financial position.

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

(iii) The company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

ANNEXURE - A TO INDEPENDENT AUDITORS’ REPORT

Referred to in Paragraph 1(f) under the heading of “Report on Other Legal and Regulatory Requirements” section of our report of even date

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (’the Act’)

We have audited the internal financial controls over financial reporting of Kerala Ayurveda Limited ( ''the Company'') as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended and as on that date. Management’s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India ( the '' Guidance Note''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Standards on Auditing prescribed under Section 143(10) of the Act and the Guidance Note, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial controls over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note.

ANNEXURE- B TO INDEPENDENT AUDITOR''S REPORT

The Annexure referred to in Independent Auditors Report to the members of the Company on the standalone financial statements for the year ended 31st March 2016, we report that:

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

(b) The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of 3 years. In accordance with this programme , certain fixed assets were verified during the year and no material discrepancies were noticed on such verification .In our opinion , this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

ii. As explained to us, physical verification of inventory has been conducted at reasonable intervals by the management and discrepancies noticed on such verification between physical stocks and book records were not material considering the operations of the Company and the same have been properly dealt with in the books of account.

iii. The Company has granted loans to its subsidiaries covered in the register maintained under section 189 of the Companies Act, 2013 (''the act'')

(a) In our opinion the terms and conditions on which the loans had been granted to subsidiaries listed in the register maintained under section 189 of the Act were not ,prima facie, prejudicial to the interest of the Company

(b)The loans are interest free and the terms of arrangements do not stipulate any repayment schedule and the loans are repayable on demand. Accordingly, the provisions of clause (iii) (b) of the order is not applicable.

(c) There are no overdue amounts in respect of the loans granted to the body corporate listed In the register maintained under section 189 of the Act

iv. In our opinion and according to the information and explanations given to as by the management, the company has complied with the provisions of the section 185 and 186 of the Companies Act, 2013, with respect to loans, investments, guarantees and securities made.

v. In our opinion and according to the information and explanations given to as by the management, the company has not accepted any deposit within the meaning of sections 73 and 76 of the Companies Act, 2013 and the rules framed there under.

vi. We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government under section 148 (1) of the Companies act 2013 for maintenance of cost records and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

vii. According to the records of the company, and information and explanations given to us, the Company has generally been regular in depositing with the appropriate authorities undisputed statutory dues including Provident fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other statutory dues applicable to it. There are no undisputed statutory dues as referred to above as at 31^st March, 2016 outstanding for a period of more than six months from the date they became payable.

viii. Based on our audit procedures and according to the information and explanations given to as by the management, the company has not defaulted in repayment of loans or borrowings to a financial institutions, Bank ,Government or dues to debenture holders. The Company has not issued any debenture .

ix. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they are obtained. Further as per the records, the Company did not raise any money by way of initial public offer, further public offer (including debt instruments).

x. Based upon the audit procedures performed and to the best of our knowledge and belief and according to the information and explanations given to as, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year.

xi. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Act.

xii. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3 (xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards

xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3 (xv) of the Order is not applicable.

xvi. The Company is not required to be registered under section 45-1A of the Reserve Bank of India Act 1934.

For BIJU GEORGE & CO

Chartered Accountants

FRN: 007920S

Sd/-

BIJU GEORGE, B. Sc, FCA, DISA(ICA)

Thodupuzha Proprietor

28 May, 2016 MEM REGN No. 206233

---

Mar 31, 2015

We have audited the accompanying financial statements of Kerala Ayurveda Limited, ("the Company"), which comprise the Balance Sheet as at March 31,2015, the Statement of Profit and Loss and the Cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ('the Act') with respect to the preparation and presentation 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 the Companies (Accounts) Rules, 2014. This responsibility also 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; and design, implementation and maintenance of adequate internal financial controls, that were 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 or error.

Auditors' 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 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 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 the 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.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, 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

a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2015,

b) In the case of the statement of Profit and Loss, of the profit 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, 2015 issued by the Central Government of India in terms of sub-section (11) of section143 of the Act, We give in the Annexure a statement on the matters Specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. As required by section 143(3) of the Act, we 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 it appears from our examination of those books;

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

d. 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;

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 and

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

(i) There were no pending litigations which would impact the financial position of the Company

(ii) The Company does not have any long-term contracts requiring a provision for material foreseeable losses.

(iii) The company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

ANNEXURE TO INDEPENDENT AUDITORS' REPORT Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory

Requirements" of our report of even date

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 have been physically verified by the Management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

ii) (a) The inventories have been physically verified during the year by the management. In our opinion 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 inventories followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business

(c) The Company has maintained proper records of inventories. As per the information and explanations given to us, no material discrepancies were noticed on physical verification

iii) (a) The company has granted loans to its subsidiaries covered in the register maintained under section 189 of the act ('the act')

(b) The terms of arrangements do not stipulate any repayment schedule and the loans are repayable on demand. Accordingly paragraph 3(ii)(b) of the order is not applicable to the Company in respect of repayment of the principal amount

(c) There are no overdue amounts of more than Rupees one lakh in respect of the loans granted to the body corporates 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 an adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit ,we have not observed any continuing failure to correct major weaknesses in such internal control system.

v) According to the information and explanation given to us the company has not accepted any deposit from the public. Accordingly the provisions of clause 3(v) of the Order are not applicable to the Company

vi) The central government has not prescribed maintenance of cost records under Section 148 (1) of The Companies Act, 2013 . Accordingly the provisions of clause 3(vi) of the Order are not applicable to the Company

vii) (a) According to the records of the company, undisputed statutory dues including Provident fund, Employees State Insurance , Income tax, Sales tax, Wealth Tax, Service tax, Duty of customs, Duty of excise, Value added tax, Cess and other material statutory dues have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us no undisputed amounts payable in respect of the aforesaid dues were outstanding as on March 31,2015 for a period of more than six months from the date of becoming payable. (b)According to the records of the company there are no amounts that are due to be Transferred to the Investor Education and Protection Fund in accordance with the relevant provisions of The Companies Act, 1956 and rules made there under.

viii) The accumulated loss of the company is not more than fifty percent of its net worth. The company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

ix) Based on our Audit procedures and according to the information and explanations given to us , we are of the opinion that the company has not defaulted in repayment of dues to financial institutions or bank or debenture holders.

x) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions. Accordingly the provisions of clause 3(x) of the Order are not applicable to the Company

xi) The Company did not have any the term loans outstanding during the year. Accordingly the provisions of clause 3(xi) of the Order are not applicable to the Company

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

For BIJU GEORGE & CO Chartered Accountants FRN: 007920S

Bengaluru BIJU GEORGE, B.SC, FCA 29 May, 2015 Proprietor MEM REGN No. 206233

---

Mar 31, 2014

We have audited the accompanying financial siatemonis of Kerala Ayurveda Limited (The Company"), which comprise the Balance Sheet as at March 31,2014, the Starement of Profit and Loss and Cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Management -s responses for the preparation o' these fmanc-al statements tnat give a true and fair view of the financial position, financial performance and cash nows of the Company in accordance with the accounting standards notified under the Companies Act, 1956, (the Act) read with the general circular 15/2013 dated 13th September ,2013 ol the Ministry of Corporate Affa-rs m respect of section 133 of the Companies Act 2013 and In accordance with iho accounting principles generally accepted In India This responsibility includes the design, implementation and maintenance of interna! control relevant to the preparation and presentation ol the financial statements that give a true and fa-r view and are free from material misstatement, whether oue to frauo or error

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit We conducted our audit in accordance with the Standards on Auditing Issued by the Institute of Chartered Accountants ol India. Those Standards require that we comply with ethical roqulroments and plan and perform tno aud-t to ootain reasonable assurance about whether the financial statements are free from materiel misstatements.

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

Wo believe tnat the audit evidence wo have obtained Is sufficient and appropriate to provide a basis tor our audit opinion

Opinion

In our opmion and to the best ol our Information and according to the explanations gven to us, the aforesaid tlnanclal statements give the .ntormation required by the Act .n the manner so required and give a true and fair view in conformity wtfh the accounting principles generally accepted in India-

a In the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2014; b. In the case ot the Statement of Profit and Loss, of the profit of the company for the year ended on that date and c In the case ot the Cash Flow Statement, of the cash flows of the company for the year ended on that date Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2003 ("the Order) issued by the Central Government of India in terms ot Section 227(4A) of the Act, we grve 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 betiel 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 Conyany so far as appears from our examination of those books.

c The Balance Sheet, the Statement of Profit and Loss and the Cash flow statement deat with by thus Report are in agreement with the books of account.

d. In our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement comply with the Accounting Standards notified under the Companies Act 1956 road with the general circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affaire m respect of section 133 ot the Companies Act 2013 e) On the basis ol the wriiten representations received from the directors as on March 31, 2014. taken on record by the Board of Directors, none of the directors is disqualified as on March 31. 2014. from being appointed as a director in terms of Section 274( 1 )(g) of the Compaines Act 1956

ANNEXURE TO INDEPENDENT AUDITORS' REPORT

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

I. In respect ot its fixed assets:

a) Tne Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b) As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies wore noticed on such physical verification.

c) In our opinion, the Company has not disposed off a substantial pan of its fixed assets dunng the year and the going concern status of the Company is not affected

II In respect of its inventories:

a) The inventonos have been physically venfied during the year by the management. In our opinion, 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 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 has maintained proper records of inventories. As explained to us. there were no material discrepancies noticed on physical verification of Inventories as compared to the book records

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

a) The Company has given unsecured loans to subsidianes. In respect of the said loans, the maximum amount outstanding at any time during the year was Rs. 2998.69 Lacs and the year-end balance Is Rs. 2956.19 Lacs

b) In our opinion and according to the information and explanations given to us. the rate ot 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 is interest free and principal amounts are repayable on demand

d) In respect of the said loans and Interest thereon, there are no overdue amounts,

e) The Company has taken additional loan from Group Company of the promoter.. In respect of the said loans, the maximum amount outstanding at any time dunng the year was Rs. 5357.85 Lacs and the year-end balance Rs. .4760.10Lacs.

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 is interest free and principal amounts are repayable on demand

IV. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchases ot fixed assets and for the services During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system,

V In respect of the contracts or arrangements referred to in Section 301 of the Companies Act. 1956:

a) Based on the audit procedures applied by us and according to the information and explanations provided by Ihe 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) As per information & explanations given to us and In our opinion, the transactions made in pursuance of contracts / arrangements entered In the Register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5,00,000 in respect of each party during the year have been made at prices which appear reasonable as per Information available with the Company.

VI. According to the information and explanation given to us. the Company has not accepted any deposits from the Public. Therefore the provisions of Clause (vi) of paragraph 4 of the order are not applicable to the company.

VII In our opinion tho Company has an internal audit system commensurate with the size and the nature of the business.

VIII. We have broadly reviewed the cost records maintained by tho Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act. 1956 and are of tho opinion that prima facie tho prescribed cost records have been maintained. Wo have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete

IX In respect of statutory dues:

According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance. Income-Tax, Tax. Wealth Tax, Service Tax, Customs Duty, Excise Duty. Cess, and other statutory dues have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us. no undisputed amounts payable in respect of the aforesaid dues were outstanding as at March 31.2014 for a period of more than six months from the date of becoming payable.

X. The Company's accumulated losses at the end of the financial year is less than 50% of its net worth. The Company has not incurred any cash loss during the financial year covered by the audit and in the immediately preceding financial year

XI Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted In repayment of dues to financial institutions, banks and debenture holders.

XII. In our opinion and according to the explanations given to us and based on the Information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

XIII. In our opinion, the Company Is not a chit fund /nidhi/ mutual benefit fund / society. Therefore, the provisions of clause (xili) of paragraph 4 of the Order are not applicable to the Company.

XIV According to the information and explanations given to us the Company has not dealt In shares or In securities or debentures or other Investment during the year

XV. The Company has given guarantee for Loans taken by others from Banks and Financial Institutions. The terms and conditions there of are not prima facie prejudicial to the interest of the Company.

XVI, The Company has not raised any new term loan during the year.

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

XVIII. The company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act 1956.

XIX. The company has not issued debentures and hence requirement of reporting regarding creation of securities in respects of debentures issued does not arise.

XX. The Company has not raised any monies by way of public issues during the year

XXI. In our opinion and according to the Information and explanations given to us, no material fraud on or by the Company has boon noticed or reported during the year.

For Maharaj Rajan & Mathew, Chartered Accountants Firm Regn No: 001932S

Place: Bangalore Mathew Joseph, Partner Date : 24th May. 2014 Membership No.22658

---

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Kerala Ayurveda Limited ("the Company"), which comprise the Balance Sheet as at March 31,2013, the Statement of Profit and Loss and Cash flow statement or the year 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 and financial performance of the Company in accordance with the accounting principles generally accepted in India including Accounting Standards referred to in Section 211 (3C) 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.

Auditors'' Responsibility

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

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 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:

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

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

(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 Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

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

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

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in Paragraph 1 under the heading of "Report on Other Legal and Regulatory

Requirements" of our report of even date

I. In respect of its fixed assets:

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

b) As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification.

c) In our opinion, the Company has not disposed off a substantial part of its fixed assets during the year and the going concern status of the Company is not affected.

II. In respect of its inventories:

a) The inventories have been physically verified during the year by the management. In our opinion, 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 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 has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to the book records.

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

a) The Company has given unsecured loans to subsidiaries. In respect of the said loans, the maximum amount outstanding at any time during the year was Rs..286,485,728/- and the year-end balance is Rs..286,485,728/-

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 is interest free and principal amounts are repayable on demand.

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

e) The Company has taken additional loan duringtheyearfromGroupCompanyofthepromoter.. Inrespectof the said loans, the maximum amount outstanding at any time during the year was Rs.. 550,165,937/- and the year-end balance is Rs..534,488,566/-.

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 given by the Company, are not prima facie prejudicial to the interest of the Company

g) The loan is interest free and principal amounts are repayable on demand.

IV. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchases of fixed assets and for the services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system

V. In respect of the contracts or arrangements referred to in Section 301 ofthe Companies Act, 1956:

a) Based on the audit procedures applied by us 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) As per information & explanations given to us and in our opinion, the transactions made in pursuance of contracts / arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5,00,000 in respect of each party during the year have been made at prices which appear reasonable as per information available with the Company.

VI. In our opinion and according to the information and explanations given to us, directives issued by the Reserve Bank of India and provisions of section 58 A and 58AA of the Companies Act, 1956 and the Rules framed there under to the extent applicable have been complied with.

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

VIII. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1 )(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

IX. In respect of statutory dues:

a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-Tax, Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess, and other statutory dues have been generally regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at March 31, 2013 for a period of more than six months from the date of becoming payable.

X. The Company''s accumulated losses at the end of the financial year is less than 50% of its net worth. The Company has not incurred any cash loss during the financial year covered by the audit and in the immediately preceding financial year.

XI. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders.

XII. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

XIII. In our opinion, the Company is not a chit fund /nidhi / mutual benefit fund / society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Order are not applicable to the Company.

XIV. According to the information and explanations given to us the Company has not dealt in shares or in securities or debentures or other investment during the year.

XV. in our opinion and according to the information and explanations given to us the terms and conditions on which the company has given guarantee for loans taken by subsidiary company from banks are not prima-facie prejudicial to the interest of the company.

XVI. The Company has not raised any new term loan during the year. The term loans outstanding at the beginning of the year have been applied for the purpose for which they were obtained.

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

XVIII. The company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

XiX. The company has not issued debentures and hence requirement of reporting regarding creation of securities in respects of debentures issued does not arise.

XX. The Company has not raised any monies by way of public issues during the year

XXI. In our opinion and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the year.



For Maharaj Rajan & Mathew,

Chartered Accountants

FirmRegnNo:001932S



Place: Bangalore Mathew Joseph, Partner

Date : 29th May, 2013 Membership No.22658

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of KERALA AYURVEDA LIMCTED as at 31st March 2011, the Profit and Loss Account and the Cash Flow Statement for the year ended on that date both annexed there to. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2009 issued by the Central Government of India in terms of sub section (4A) of Section 227 of the Companies Act, 1956. we enclose In the Annexure a statement on the matters specified in paragraph 4 and 5 of the said order to the extent applicable

4. Further to our comments in the Annexure referred to in paragraph (3) 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, the Profit and 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, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in sub-section 3(C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors, as on 31st March 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 at March 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Ad, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, they said accounts, read together with the notes thereon, give the information required by the Companies Act, 1956 In the manner so required and give a true and fair view In conformity with the accounting principles generally accepted in India.

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

ii) In the case of the Profit and Loss Account, of the profit of the Company tor the year ended on that date; end

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

Annexure to the Auditors' Report

(Referred to in paragraph (3) of our report of even date)

I. e) The company has maintained proper records showing lull particulars including quantitative details end situation of fixed assets.

b) All the fixed assets have not been physically verified by the management during the year but the Company has a regular programmer of verification which, In our opinion, is reasonable having regard to the size of the company and the nature of Its assets. No material discrepancies were noticed on such verification,

c) In our opinion the fixed assets disposed off during the year were not material) so as to affect the gong concern status of the company.

II. a) The management has conducted physical verification Inventory at reasonable intervals

b) In our opinion, the procedures of physical verification of Inventory followed by the management are reasonable and adequate In relation to the size of the company and the nature of Its business.

c) On the basis of our examination of the records of Inventory, we are of the opinion that the company Is maintaining proper records of Inventory. The discrepancies noticed on verification between the physical stocks and book records were not material and have been property dealt with In the books of account,

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

a) During the year the Company has given unsecured loan to subsidiary companies. In respect of the said loan the maximum amount outstanding at any time during the year is Rs. 288,225 564/- and the balance outstanding is Rs.22O,408,O79/-. In our opinion and according to the Information and explanation given to us the loan Is interest tree, repayable on demand and terms and conditions are not prejudicial to the interests of the company.

b) During the year the Company has taken additional loans from group company of the promoter. In respect of the said loans maximum amount outstanding at any time during the year is T554,152.783/- and balance outstanding isRs.488,347,463/-. In our opinion and according to the information and explanations giventous the loan is Interest free, repayable on demand and terms and conditions are not prejudicial to the Interests Of the company.

IV. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and tor the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system

V. a) According to the information and explanations given to us. we are of the opinion that the transactions that need to be entered in to the register maintained under Section 301 of the Companies Act, 1958 have been so entered.

b) According to the Information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered In the registers maintained under Section 301 and exceeding the value of five lakhs rupees In respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

VI. In our opinion and according to the Information and explanations given to us the company has not accepted deposits from the public during the year. Therefore the provisions of clause 4(vi) of the order are not applicable to the company.

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

VIII. On the basis of records produced we are of the opinion that prime facie cost records and accounts prescribed by the Central Govt under Section 209 (1) (d) of the Companies Act, 1956 in respect or products of the company covered under the rules under said section have beer maintained We have not however made a cot ailed examination of the records with a view to determine whether they are accurate or complete.

IIX. According to the records of the company, the company was regular In depositing the Provident Fund dues and Employees State Insurance dues with the appropriate authorities. Based on our audit procedures and according to the information and explanations given to us there are no arrears of statutory dues Including Provident Fund, Employees' State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Service tax, Cess and other statutory dues applicable to it which have been remained outstanding as at 31st March, 2011 for a period of more than six months from the date they become payable.

X. The company's accumulated loss at the end of the financial year Is less than 50% of its net worth. The company has not Incurred cash loss during the year covered by our audit and during the Immediately preceding financial yea;

XI. The company has not defaulted in repayment of dues to financial Institutions or banks. The company has no debenture holders.

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

XIII. The company is not a chit fund or a Nidhi / mutual benefit fund / society. Therefore the provisions of clause 4(xiii) of the Companies (Auditor’s Report) Order 2003 are not applicable to the company.

XIV. The company is not dealing or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 were not applicable to the company.

XV. In our opinion and according to the information and explanations given to us the terms and conditions on which the company has given guarantee for loans taken by subsidiary company from banks and other guaranties are not prime-facie prejudicial to the interest of the company.

XVI. The company did not have any term loans outstanding during the year.

XVII. According to the Information and explanations given Id us, the funds raised on short-term basis during the year have not been used for long -term investment

XVIII. The company has not made any preferential allotment of shares during the year to parties and companies covered in this Register maintained under Section 301 of the Companies Act, 1956.

XIX. The company has not issued any debentures and therefore the provisions of clause 4 of the Companies (Auditors Report) Order, 2003 are not applicable to the company

XX. During the period covered by our audit report, the company has not raised any money by public Issue.

XXI. Based upon the audit procedures performed and according to the Information and explanations given and representations made by the management, we report that no Fraud on or by the company has been noticed or reported during the year

For Maharaj Rajan & Mathew,

Chartered Accountants Firm Regn No:001932S

Place : Kochi Mathew Joseph, Partner

Date : 12/08/2011 Membership No.22658

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of KERALA AYURVEDA LIMITED as at 31st March 2010, the Profit and Loss Account and the Cash Flow Statement for the year ended on that date both annexed there to. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraph 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph (3) 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, the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agre- ement with the books of account,

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

e) On the basis of written representations received from the directors, as on 31st March 2010 and taken on re- cord by the Board of Directors, we report that none of the directors is disqualified as on 31st March 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956,

f) In our opinion and to the best of our information and according to the explanations given to us, the said acco- unts, read together with the notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally acce- pted in India.

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

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

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

Annexure to the Auditors Report (Referred to in paragraph (3) of our report of even date)

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

b) All the fixed assets have not been physically verified by the management during the year but the Company has a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

c) In our opinion the fixed assets disposed off during the year were not material so as to affect the going concern status of the company.

II. a) The management has conducted physical verification of inventory at reasonable intervals.

b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c) On the basis of our examination of the records of inventory, we are of the opinion that the company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and book records were not material and have been properly dealt with in the books of account.

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

a) During the year the Company has given unsecured loan to subsidiary company. In respect of the said loan the maximum amount outstanding at any time during the year is Rs. 120,900,643/- and the balance outstanding is Rs. 120,900,643/-. In our opinion and according to the information and explanation given to us the loan is interest free, repayable on demand and terms and conditions are not prejudicial to the interests of the company.

b) During the year the Company has taken additional loans from one existing party. In respect of the said loans maximum amount outstanding at any time during the year is Rs. 405,277,143/- and balance outstanding is Rs. 398,146,186/-. In our opinion and according to the information and explanations given to us the loan is interest free, repayable on demand and terms and conditions are not prejudicial to the interests of the company.

IV. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the 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 control system.

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

b) According to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the registers maintained under section 301 and exceeding the value of five lakhs rupees in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

VI. In our opinion and according to the information and explanations given to us the company has not accepted deposits from the public during the year. Therefore the provisions of clause 4 (vi) of the order are not applicable to the company.

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

VIII. We have broadly reviewed the books of account maintained by the company in respect of manufacture of Ayurvedic products pursuant to the order made by the Central Government for maintenance of cost records prescribed under section 209 (1) (d) of the Companies Act, 1956 and are of the opinion that prima-facie, the prescribed accounts and records have been made and maintained. We have not however made a detailed examination of the records with a view to determine whether they are accurate or complete.

IX. According to the records of the company the company was regular in depositing the Provident Fund dues and Employees State Insurance dues with the appropriate authorities except in a few cases where there were delays. Based on our audit procedures and according to the information and explanations given to us there are no arrears of statutory dues including Provident Fund, Employees State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty Service tax, Cess and other statutory dues applicable to it which have been remained outstanding as at 31st March, 2010 for a period of more than six months from the date they become payable.

X. The companys accumulated loss at the end of the financial year is less than 50% of its net worth. The company has incurred cash loss during the year covered by our audit and during the immediately preceding financial year.

XI. The company has not defaulted in repayment of dues to financial institution or bank. The company has no debenture holders.

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

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

XIV. The company is not dealing 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.

XV. In our opinion and according to the information and explanations given to us the terms and conditions on which the company has given guarantee for loans taken by subsidiary company from banks are not prima-facie prejudicial to the interest of the company.

XVI. According to the information and explanation given to us term loans taken during the year were applied for the purpose for which the loans were obtained.

XVII. According to the information and explanations given to us the funds raised on short-term basis during the year have not been used for long-term investment.

XVIII. The company has not made any preferential allotment of shares during the year to parties and companies covered in the Register maintained under section 301 of the Companies Act, 1956.

XIX. The company has not issued any debentures and therefore the provisions of clause 4 (xix) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

XX. During the period covered by our audit report, the company has not raised any money by public issue.

XXI. Based upon the audit procedures performed and according to the information and explanations given and representations made by the management, we report that no fraud on or by the company has been noticed or reported during the year.

For Maharaj Rajan & Mathew, Chartered Accountants

Place : Kochi Mathew Joseph, Partner

Date :21.08.2010 Membership No.22658