Auditor Report of Paramount Cosmetics (I) Ltd.

Mar 31, 2024

We have audited the accompanying financial statements of M/s. PARAMOUNT COSMETICS (INDIA)
LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2024, 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, notes to the financial statements including material accounting policy
information and other explanatory information (hereinafter referred to as the "financial statements").

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 Companies Act, 2013 ("the Act") in the manner so
required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under
section 133 of the Act read with companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS")
and other Accounting Principles generally accepted in India, of the state of affairs of the Company as at March
31, 2024 and its Profit, total comprehensive income, its cash flows and changes in equity for the year ended on
that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing ("SA" s)
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 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 independence requirements that are relevant to our audit of the financial statements
under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities
in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our opinion on financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit
of the financial statements of the current period. These matters were addressed in the context of our audit of the
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.

A) Provisions for taxation, litigation, and other significant provisions

(i) Accrual for tax and other contingencies requires the Management to make judgements and estimates in
relation to the issues and exposures arising from a range of matters relating to direct tax, indirect tax,
transfer pricing arrangements, claims, general legal proceedings, environmental issues, and other
eventualities arising in the regular course of business.

(ii) The key judgement lies in the estimation of provisions where they may differ from the future obligations.

By nature, provision is difficult to estimate and includes many variables. Additionally, depending on
timing, there is a risk that costs could be provided inappropriately that are not yet committed.

How the matter was addressed in Our audit procedures included:

(i) We tested the effectiveness of controls around the recognition of provisions.

(if) We used our subject matter experts to assess the value of material provisions in light of the nature of the
exposures, applicable regulations, and related correspondence with the authorities.

(iif) We challenged the assumptions and critical judgements made by management which impacted their
estimate of the provisions required, considering judgements previously made by the authorities in the
relevant jurisdictions or any relevant opinions given by the Company''s advisors and assessing whether
there was an indication of management bias.

(iv) We discussed the status in respect of significant provisions with the Company''s internal tax and legal
team.

(v) We performed retrospective review of management judgements relating to accounting estimate included
in the financial statement of prior year and compared with the outcome.

B) Assessment of contingent liabilities relating to litigations and claims

(i) The Company is periodically subject to challenges / scrutiny on range of matters relating to direct tax,
indirect tax, and transfer pricing arrangements.

(if) Further, potential exposures may also arise from general legal proceedings, environmental issues etc. in
the normal course of business,

(iif) Assessment of contingent liabilities disclosure requires Management to make judgements and estimates
in relation to the issues and exposures. Whether the liability is inherently uncertain, the amounts involved
are potentially significant and the application of accounting standards to determine the amount, if any,
to be provided as liability, is inherently subjective.

How the matter was addressed in our audit procedures included;

(i) We tested the effectiveness of controls around the recording and re-assessment of contingent liabilities.

(ii) We used our subject matter experts to assess the value of material contingent liabilities in light of the
nature of exposures, applicable regulations, and related correspondence with the authorities.

(iif) We discussed the status and potential exposures in respect of significant litigation and claims with the
Company''s internal legal team including their views on the likely outcome of each litigation and claim
and the magnitude of potential exposure and sighted any relevant opinions given by the Company''s
advisors.

(iv) We assessed the adequacy of disclosures made.

(v) We discussed the status in respect of significant provisions with the Company''s internal tax and legal
team.

(vi) We performed retrospective review of management judgements relating to accounting estimate included
in the financial statement of prior year and compared with the outcome.

Information Other than the financial statements and Auditor''s Report Thereon

The Company''s Board of Directors is responsible for the preparation of the other information. The other
information comprises the information included in the Management Discussion and Analysis, Board''s Report
including Annexures to Board''s Report, Corporate Governance and Shareholder''s Information, but does not
include the financial statements and our auditor''s report thereon.

Our opinion on the 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 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 during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we concluded that there is a material statement of this other
information, we are required to report that fact. We have nothing to report in this regard.

Managements and Board of Directors Responsibility for the financial statements

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 financial statements that give a true and fair view of the financial position, financial
performance, including other comprehensive income, changes in equity and cash flows of the Company in
accordance with the Ind AS and other 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 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.
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 management either intends to liquidate the Company or to cease operations,
or has no realistic alternative but to do so.

The Board of Directors are 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 in
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
skepticism 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. 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 financial controls 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 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 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 (ii) 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 identify 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.

From the matters communicated with those charged with governance, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor''s 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

1. As required by Section 143(3) of the Act, based on our audit 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 purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company as 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 Statement of Cash Flow dealt with by this Report are in agreement with the
relevant books of account.

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

(cj On the basis of the written representations received from the directors as on March 31,2024 taken on
record by the Board of Directors, none of the director 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 A''. Our report
expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal
financial controls over financial reporting.

( gj With respect to the other matter to be included in the auditor''s report in accordance with the requirements
of section 197(16) of the act, as amended:

In our opinion and to the best of our information and according to the explanations given to us, the remuneration
paid by the Company to its directors during the year is in accordance with the provisions of section 197 of 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 has disclosed the impact of pending litigations on its financial position in its financial
statements.

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

iii. There were amounts which were required to be transferred to the Investor Education and Protection Fund
by the Company and same has been transferred accordingly.

iv. (a) The management has represented that, to the best of its knowledge and belief, other than as disclosed
in the notes to the accounts, 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, other than as disclosed in the
notes to the accounts, 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

(c) Based on such 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(e), as provided under (a) and (b) above, contain any material misstatement.

v. During the Year the company has not declared or paid dividend during the year. Hence, the compliance
of Section 123 of the Act is not applicable.

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

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

2. 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, PARY & CO.,

Chartered Accountants
Firm Reg. No. 007288C

Rakesh Kumar Jain

Partner

Place: Surat Membership No: 106109

Date: 23/05/2024 UDIN:24106109BKHGYK2875

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Mar 31, 2015

We have audited the accompanying financial statements of Paramount Cosmetics (India) Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, 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 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 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 the 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.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under. We conducted our audit in accordance with the Standards on auditing specified under Section 143(10) 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 controls relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's 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 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 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 section 143 of the Act (hereinafter referred to the "Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure 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, 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 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.

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), 2014, in our opinion and to the best of our information and according to the explanations given to us;

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements,

(ii) In our opinion and as per the information and explanations provides to us, the Company has not entered into any long-term contracts including derivative contracts, requiring provision under applicable laws or accounting standards, for material foreseeable losses, and

(iii) The company is not required to transfer amount to investor education and protection fund therefore there is no delay in transferring the amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Annexure to the Independent Auditors' Report

(Referred to in Paragraph 1 under section (Report on Other Legal and Regulatory Requirements, of our report of even date)

1.1. The company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. However the addition made during the year are not updated.

1.2. Some of the fixed assets were physically verified during the year by the management in accordance with a program of verification of fixed assets at reasonable intervals. According to the information and explanation given to us no material discrepancy were noticed on such verification.

2.1. According to the information and explanation given to us , physical verification of inventory has been conducted by the management at reasonable interval.

2.2. 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.

2.3. In our opinion and according to the information and explanations given to us, the Company is maintaining proper records of its inventories and no material discrepancies were noticed on such physical verification.

3. As informed to us, the company has not granted any loan, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act 2013.

4. 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 with regard to purchase of inventories, fixed assets and for the sale of goods and services. During the course of audit, we have not observed any continuing failure to correct major weaknesses, if any, in internal control system.

5. According to the information and explanations given to us, the Company has not accepted any deposits from public within the meaning of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under during the year under review.

6. The Central Government has not prescribed maintenance of Cost Records under sub-section (1) of Section 148 of the Companies Act, 2013 in respect of products dealt with by the Company.

7.1 In our opinion and according to the information and explanation given to us the company is generally regular in depositing 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 any other statutory dues with the appropriate authorities and we have been informed that there are no arrears of outstanding statutory dues as at the last day of the financial year under audit for a period of more than six months from the date they became payable.

7.2 According to the information and explanations given to us and records examined by us the particulars of dues of Vat as on 31st march 2015 which have not been deposited on account of dispute is as follows:

Name of the Nature of Amount Period to Forum where statute dues which the the dispute involve Rs is pending (In Lakh) amount Relates

Gujarat sales Vat Dues 576.40 AY 2005-2006 The Commissioner tax- sales tax commercial department Taxes Surat, Gujarat

According to information and explanations given to us and the records of the company examined by us no dues of vat, duty of custom, duty of excise, wealth tax, service tax which have not been deposited on account of any dispute.

7.3 In our opinion and according to the information and explanations given to us, the company is not required to transfer amounts required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and Rules made there under.

8. The Company has no accumulated losses at the end of the financial year under audit. The company has not incurred cash losses during the financial year covered by audit and in the immediately preceding financial year.

9. According to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution or bank.

10. 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.

11. According to the information and explanations given to us, term loans were obtained during the year under audit and applied for the purpose for which it has taken the loan.

12. Based upon the audit procedures performed and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year of our audit.

For S.S. Jain & Associates Chartered Accountants Firm Registration No. 103970W

Sd/- S. K.Jain Proprietor Membership Number: 038664

Place: Bangalore Dated: 30th May 2015

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Mar 31, 2014

We have audited the accompanying financial statements of Paramount Cosmetics (India) Ltd. (''the Company'') which comprise the Balance Sheet as at 31st March 2014, 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 Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 (the Act) read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

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

a) Provision of Gratuity for Rs. 5,60,533/-is made for those employees who have completed five year of their services,

b) Balances of Debtors and creditors are subject to confirmation & reconciliation, any loss on account of this is undeterminable

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

ii) in the case of the statement of profit and loss, of the profit for the year ended on that date; and

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

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

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

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

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

d. in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards notified under the Act read with the general circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate affairs in respect of Section 133 of the Companies Act, 2013 and

e. on the basis of written representations received from the Directors as on 31st March 2014, and taken on record by the Board of Directors, none of the Directors is disqualified as on 31stMarch 2014, from being appointed as a Director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

The Annexure referred to in our report to the members of Paramount Cosmetics (India) Ltd. (''the Company'') for the year ended 31st March 2014. We report that:

1. In respect of its fixed assets:

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

b) As explained to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which in our opinion is reasonable, having regard to 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 substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of its inventories:

a) As explained to us, inventories have been physically verified by the management at regular intervals during the year, in our opinion the frequency of verification is adequate.

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 was no material discrepancies noticed on physical verification of inventory as compared to the book records.

3. The company has not given any loans, secured or unsecured, to the companies, firm or other parties covered in the register maintained under section 301 of the Act. Hence clauses (iii)(b), (c) & (d) of the order, are not applicable.

(a) The Company has taken unsecured loans from three persons covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year end balance of such loan aggregate to Rs. 3,34,43,416/- and Rs. 2,85,43,416/- respectively.

(b) In our opinion, the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

(c) In respect of the aforesaid loan, there is no stipulation about repayment of principal however the loans are repaid as and when demanded by the loaner.

(d) The company is regular in payment of interest.

4. 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 also for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. In respect of transactions covered under Section 301 of the Companies Act,1956;

a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that needed to be entered into in the register maintained under Section 301 of the Companies Act, 1956 have been properly entered.

b) According to the information and explanations given to us, the transactions of purchase of goods and materials and sales of goods, material and services, made in pursuance to contracts or arrangement entered in the registers main- tained under Section 301 of the Companies Act, 1956 and aggregating during the year to Rs. 500,000/- (Rupees Five lacs only) or more in respect of each party, have been made at prices which in our opinion are reasonable having regards to prevailing market prices for such goods, material or services or the prices at which similar transaction have been made with other parties as the case may be.

6. The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Act and rules framed there under.

7. In our opinion, the company''s present internal audit system is commensurate with the size of its business.

8. The Central Government has not prescribed maintenance of Cost Records under Section 209 (1) (d) of the Companies Act, 1956 in respect of certain manufacturing activities of the Company.

9. In respect of statutory dues:

a. According to the books and records as produced and examined by us in accordance with generally accepted auditing practices in India and also based on management representations of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales-tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues as applicable have been generally regularly deposited with the appropriate authorities in India except vat dues, income tax deducted at source,ESIC employees & employers contribution and Dividend Tax amounting to Rs 10,462/- (Annex 1)

b. As at 31st March 2014 there have been no disputed dues which have not been deposited with respective authorities in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Sales-tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other material statutory dues as applicable except:

Sr Name of the Nature of Amount (Rs. Period Forum where No. Statute the Dues in Lakhs) to which dispute is the amount relates pending

1 Gujarat Commissioner- Sales Tax Commercial Dept. Vat Dues 576.40 2005-06 Taxes Surat, Gujarat

10. The company has not incurred cash loss in the current financial year and there is no cash loss in the immediately preceding financial year.

11. According to the records of the Company, the Company has not defaulted in repayment of its dues of any Bank during the year.

12. In our opinion and according to the information and explanation given to us, 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.

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

14. The Company has not dealt in or of trading in shares, securities, debentures and other Investments. Accordingly, the provisions of Clause v(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

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

16. In our opinion, on the basis of information and explanation given to us, the term loans are applied for the purpose for which the loans were obtained.

17. 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 which have been used for long term investment.

18. During the year, 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.

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

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

21. In our opinion and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year, that causes the financial statements to be materially misstated.

For R. U. JAIN & CO. Chartered Accountants

R. U. JAIN Place: Bangalore Proprietor Dated : 30 May, 2014 Membership No. 031037

---

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Paramount cosmetics India Ltd. (''the Company'') which comprise the Balance Sheet as at 31 March 2013, 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

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

Auditor''s Responsibility

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

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

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

Opinion

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

a) Provision of Gratuity for Rs 12,54,171/-is made for those employees who have completed five year of their services,

b) Balances of Debtors and creditors are subject to confirmation & reconciliation any loss on account of this is undeterminable (i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2013;

(ii) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

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

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

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

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

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

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

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

Annexure to the Auditors'' Report

The Annexure referred to in our report to the members of Paramount cosmetics (India) Ltd. (''the Company'') for the year ended 31 March 2013. We report that:

1 In respect of its fixed assets:

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

b) As explained to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which in our opinion is reasonable, having regard to 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 of substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2 In respect of its inventories:

a) As explained to us, inventories have been physically verified by the management at regular intervals during the year, in our opinion the frequency of verification needs to be increased.

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 was no material discrepancies noticed on physical verification of inventory as compared to the book records.

3 The company has not given any loans, secured or unsecured, to the companies, firm or other parties covered in the register maintained under section 301 of the Act. Hence clauses (iii)(b), (c) & (d) of the order, are not applicable.

(a) The Company has taken unsecured loans from three persons covered in the register maintained under section 301 of the Act. The maximum amount involved during the year and the year end balance of such loan aggregate to Rs. 3,15,43,416 /- and Rs.2,85,43,416/- respectively.

(b) In our opinion, the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

(c) In respect of the aforesaid loan, there is no stipulation about repayment of principal however the loans are repaid as and when demanded by the loaner.

(d) The company is regular in payment of interest.

4. 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 also for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. In respect of transactions covered under Section 301 of the Companies Act,1956;

a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that needed to be entered into in the register maintained under Section 301 of the Companies Act, 1956 have been properly entered.

b) According to the information and explanations given to us, the transactions of purchase of goods and materials and sales of goods, material and services, made in pursuance to contracts or arrangement entered in the registers maintained under Section 301 of the Companies Act, 1956 and aggregating during the year to Rs. 5,00,000/- (Rupees Five lacs only) or more in respect of each party, have been made at prices which in our opinion are reasonable having regards to prevailing market prices for such goods, material or services or the prices at which similar transaction have been made with other parties as the case may be.

6. The Company has not accepted any deposits from the public within the meaning of section 58A and 58AA of the Act and rules framed there under.

7. In our opinion, the company''s present internal audit system is commensurate with the size of its business.

8. The Central Government has not prescribed maintenance of Cost Records under Section 209 (1) (d) of the Companies Act, 1956 in respect of certain manufacturing activities of the Company.

9. In respect of statutory dues:

a. According to the books and records as produced and examined by us in accordance with generally accepted auditing practices in India and also based on management representations of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales-tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other statutory dues as applicable have been generally regularly deposited with the appropriate authorities in India except vat dues, income tax deducted at source, ESIC employees & employers contribution and Dividend Tax amounting to Rs 3803512/- (Annex 1)

b. As at 31st March, 2013 there have been no disputed dues which have not been deposited with respective authorities in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Sales-tax, Wealth Tax, Service tax, Customs Duty, Excise Duty, Cess and other material statutory dues as applicable except:

Sr No.Name of the Nature of Amount (Rs. in Period to which Forum where Statute the Dues Lakhs) the amount relates dispute is pending

1 Gujrat Sales Tax Sales tax Dept. Vat Dues 576.40 2005-06 Commissioner- Commercial Taxes, Surat, Gujarat

10. The company has not incurred cash loss in the current financial year and there is no cash loss in the immediately preceding financial year.

11. According to the records of the Company, the Company has not defaulted in repayment of its dues of any Bank during the year.

12. In our opinion and according to the information and explanation given to us, 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.

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

14. The Company has not dealt in or of trading in shares, securities, debentures and other Investments. Accordingly, the provisions of Clause v(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

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

16. In our opinion, on the basis of information and explanations given to us, the term loans are applied for the purpose for which the loans were obtained.

17. 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 which have been used for long term investment.

18. During the year, 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.

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

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

21. In our opinion and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year, that causes the financial statements to be materially misstated.

For R. U. JAIN & CO.

Chartered Accountants

R. U. JAIN

Place: Bangalore Proprietor

Dated : 30 May, 2013 Membership No. 031037

---

Mar 31, 2012

We have audited the attached Balance sheet of PARAMOUNT COSMETICS INDIA LIMITED as at 31st March 2012 and the Profit and Loss Account for the year ended on that date annexed there to and Cash Flow Statement of the Company for the year ended on that date. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

1. We conducted our audit in accordance with Auditing Standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. 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 presentation. We believe that our audit provides reasonable basis for our opinion.

2. As required by the Companies (Auditor's Report) Order 2003 ( as amended ) 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 hereto a statement on the matters specified in paragraphs 4 & 5 of the said Order.

3. Further to our comments in the Annexure referred to in paragraph 2 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 accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet ,Profit and Loss Account and Cash Flow Statement dealt with by this report are in agree- ment with the Books of Accounts;

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

e) In our opinion, and based on information and expectations given to us, none of the Director are disqualified as on 31st March 2012 from being appointed as directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other 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 principle generally accepted in India, subject to :

a) Provision for gratuity for Rs. 6,87,588.73 is made for those employees who have completed five years of their service.

b) Balance of Debtors and Creditors are subject to confirmation & reconciliation, any loss on account of these are undeterminable.

i) In so far as related to the Balance Sheet, of the statement of affairs of the Company as at 31st March, 2012 :

ii) In so far as it relates to the Profit & Loss Account, of the Profit of Company for the period ended on that date; and

iii) In so far as it relates to the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

ANNEXURE TO AUDITORS' REPORT

Referred to in Paragraph 2 of our report of even date

1. In respect of its fixed assets:

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

b. As explained to us, the fixed assets have been physically verified by the management during the year 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 of substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year, 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 inventory as compared to the book records.

3. 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 not granted secured/unsecured loans to any companies, firm or other parties covered in the register maintained under section 301 of the Companies Act 1956 consequently the requirement of clause (b) (c) & (d) of the paragraph 4 of the order are not applicable.

b. The Company has taken unsecured loans from five parties covered in the register maintained under section 301 of the Act. The maximum amount outstanding at any time during the year and the year-end balance of such loan aggregate to Rs.2,89,54,020/- and Rs. 2,85,43,416/- respectively.

c. In our opinion and according to the information and explanations given to us, the rate of interest, wherever applicable and other terms and conditions are not prima facie prejudicial to the interest of the Company, there is no stipulation about the repayment of five of these loan hence clause (iii) (g) is not applicable.

4. 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 also for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal controls.

5. In respect of transactions covered under Section 301 of the Companies Act, 1956 ;

(a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that needed to be entered into in 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 of purchase of goods and materials and sales of goods, material and services, made in pursuance to contracts or arrangement entered in the registers main- tained under Section 301 of the Companies Act, 1956 and aggregating during the year to Rs.5,00,000/- (Rupees Five lacs only) or more in respect of each party, have been made at prices which in our opinion are reasonable having regard to prevailing market prices for such goods, materials or services or prices at which similar transactions have been made with other parties as the case may be, since the purchases/sales are for branded goods, comparative prices are not available.

6. According to the information and explanations 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.

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

8. The Central Government has not prescribed maintenance of Cost Records under Section 209(1) (d) of the Companies Act, 1956 in respect of certain manufacturing activities of the Company.

9. In respect of statutory dues:

a. According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance dues, Income-Tax, Sales-tax, Wealth Tax, Service Tax , Customs Duty, Excise Duty, Cess, FBT and other material statutory dues have not been regularly deposited with the appropriate authorities. According to the information and explanations given to us, Rs. 23,31,527/- undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2012 for a period of more than six months from the date of becoming payable, as per Annexure 1.

b. As at 31st March, 2012 there have been disputed Sales Tax dues aggregating to Rs.95,580/-, that have not been deposited on account of matters pending before appropriate appellate are as under:

Sr. Name of Nature of the Amount Forum where Period to which No. statute Dues (Rs.) dispute is pending the amount Relates

1 Daman Sales Tax 95,580 Commissioner (Appeals) 92-95

10. The Company does not have accumulated losses at the end of the financial year.The Company has not incurred cash loss during the financial year covered by our audit and the immediately preceding financial year.

11. 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 a financial institution or bank

12. 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.

13. In our opinion, the Company is not a chit fund or a niche/mutual benefit fund/ society. Therefore, clause 4(xiii) of the Companies (Auditors' Report) Order 2003 as amended is not applicable to the Company.

14. The Company has not dealt in or of trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

15. The Company has not given guarantees for loans taken by others from bank.

16. As explained to us, the Company has not raised any further business loan.

17. 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 which have been used for long term investment.

18. During the year, 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.

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

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

21. In our opinion and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year that causes the financial statements to be materially misstated.

For R. U. JAIN & CO.

Chartered Accountants

R. U. JAIN

Place: Bangalore, Proprietor

Dated: 29th August, 2012 Membership No. 031037

---

Mar 31, 2010

We have audited the attached Balance sheet of PARAMOUNT COSMETICS (INDIA) LIMITED as at 31st March 2010 and the Profit and Loss Account for the year ended on that date annexed there to and CashFlow Statement of the Company for the year ended on that date. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit.

1. We conducted our audit in accordance with Auditing Standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. 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 presentation. We believe that our audit provides reasonable basis for our opinion.

2. As required by the Companies (Auditors Report) Order 2003 ( as amended ) 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 hereto a statement on the matters specified in paragraphs 4 & 5 of the said Order.

3. Further to our comments in the Annexure referred to in paragraph 2 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 accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet ,Profit and Loss Account and Cash Flow Statement dealt with by this report are in agree- ment with the Books of Accounts;

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

e) In our opinion, and based on information and explanations given to us, none of the Director are disqualified as on 31st March 2010 from being appointed as directors in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other 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 principle generally accepted in India, subject to :

a) Provision for gratuity for Rs. 13,01,064/- is made for those employees who have completed five years of their service (Note 4 - Schedule 20).

b) Balance of Debtors and Creditors are subject to confirmation & reconciliation, any loss on account of these are undeterminable.

c) No provision is made for doubtful debts for Rs.13,57,582/- (Schedule 8)

d) Non compliance of Accounting Standard 22 for Deferred Tax, deferred tax assets are under stated by Rs.44,75,364/- (Note 14 Schedule 20)

i) In so far as related to the Balance Sheet, of the statement of affairs of the company as at 31st March 2010;

ii) In so far as it relates to the Profit & Loss Account, of the Profit of Company for the period ended on that date; and

iii) In so far as it relates to the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

ANNEXURE TO AUDITORS REPORT Referred to in Paragraph 2 of our report of even date

1. In respect of its fixed assets:

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

b. As explained to us, the fixed assets have been physically verified by the management during the year 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 of substantial part of fixed assets during the year and the going concern status of the Company is not affected.

2. In respect of its inventories:

a. As explained to us, inventories have been physically verified by the management at regular intervals during the year, in our opinion the frequency of verification needs to be increased.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inven- tories 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 inventory as compared to the book records.

3. 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 granted unsecured loans to one company covered in the register maintained under section 301 of the Companies Act 1956. In respect of the said loan, the maximum amount outstanding at any time during the year was Rs. 6,05,602/- and the year end balance of such loans aggregate to Rs. 6,05,602/-.

b. In our opinion and according to the information and explanations given to us, no interest is charged on the loan and other terms and conditions are not prima facie prejudicial to the interest of the Company.

c. In respect of the aforesaid loan, There is no stipulation about the repayment hence the clause iii (d) is not applicable. The said Loan is repayable on demand and there is no repayment Schedule.

d. In respect of the Loan given by the Company, the same is repayable on demand and therefore the question of overdue amount does not arise.

e. The Company has taken unsecured loans from two parties covered in the register maintained under section 301 of the Act. The maximum amount outstanding at any time during the year and the year-end balance of such loan aggregate to Rs.60,74,372/ - and Rs. 4,70,122/- respectively.

f. In our opinion and according to the information and explanations given to us, the rate of interest, wherever applicable and other terms and conditions are not prima facie prejudicial to the interest of the Company, there is no stipulation about the repayment of two of these loan hence clause (iii) (g) is not applicable.

4. 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 also for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal controls.

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

(a) To the best of our knowledge and belief and according to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that needed to be entered into in the register maintained under Section 301 of the Companies Act, 1956 have been properly entered.

(b) According to the information and explanations given to us, the transactions of purchase of goods and materials and sales of goods, material and services, made in pursuance to contracts or arrangement entered in the registers maintained under Section 301 of the Companies Act, 1956 and aggregating during the year to Rs.5,00,000/- (Rupees Five lacs only) or more in respect of each party, have been made at prices which in our opinion are reasonable having regard to prevailing market prices for such goods, materials or services or prices at which similar transactions have been made with other parties as the case may be, since the purchases/sales are for branded goods, comparative prices are not available.

6. The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act and rules framed there under.

7. In our opinion, the companys present internal audit system needs to be strengthened having regard to the nature and size of its business.

8. The Central Government has not prescribed maintenance of Cost Records under Section 209(1) (d) of the Companies Act, 1956 in respect of certain manufacturing activities of the Company.

9. In respect of statutory dues:

a. According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protec-

tion Fund, Employees State Insurance dues, Income-Tax, Sales-tax, Wealth Tax, Service Tax , Customs Duty, Excise Duty, Cess, FBT and other material statutory dues have not been regularly deposited with the appropriate authorities. According to the information and explanations given to us, Rs. 27,14,887/- undisputed amounts payable in respect of the aforesaid dues

were outstanding as at 31st March 2010 for a period of more than six months from the date of becoming payable, as per Annexure 1.

b. As at March,31,2010 there have been disputed Sales Tax dues aggregating to Rs.9,45,477/-, that have not been deposited on

account of matters pending before appropriate appellate are as under:

Sr. Name of Nature of the Amount Forum where Period to which

No. statute Dues Rs.) dispute is pending the amount

Sales Tax- relates

1. Daman Sales Tax 95,580 Commissioner (Appeals) 92-95

2. Guwahati - 1,23,192 Board of Revenue 99-00

3. Guwahati - 1,75,708 -do- 98-99

4. Guwahati - 2,50,797 -do- 97-98

5. Guwahati - 3,00,000 -do- 96-97

Total: 9,45,477

10. The Company has not incurred cash loss during the financial year covered by our audit and the immediately preceding financial year.

11. According to the records of the Company, the Company has settled loan account with G.S.F.C., and no outstanding balance.

12. In our opinion and according to the information and explanation given to us, 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.

13. In our opinion, the Company is not a chit fund or a niche/mutual benefit fund/ society. Therefore, clause 4(xiii) of the Compa- nies (Auditors Report) Order 2003 as amended is not applicable to the Company.

14. The Company has not dealt in or of trading in shares, securities, debentures and other investments. Accordingly, the provi- sions of Clause v(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

15. The Company has given guarantees for loans taken by others from bank. The same was cancelled on 12th May, 2009.

16. As explained to us, the Company has raised business loan for the purpose of products development and launching and it has been used for the said purpose.

17. 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 which have been used for long term investment.

18. During the year, 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.

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

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

21. In our opinion and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year that causes the financial statements to be materially misstated.

For R. U. JAIN & CO.

Chartered Accountants

R. U. JAIN Place : Bangalore, Proprietor

Dated: 30th August, 2010 Membership No. 031037