Auditor Report of Rishab Special Yarns Ltd.

Mar 31, 2025

We have audited the financial statements of RISHAB SPECIAL YARNS LIMITED (“the Company”),
which comprise the balance sheet as at March 31, 2025, and the statement of profit and loss (including
other comprehensive income), statement of changes in equity and statement of cash flows for the year
then ended, and notes to the financial statements, including a summary of significant accounting policies
and other explanatory information (Collectively referred to as ''standalone financial statements'').

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 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 (financial position) of the Company as at March 31,2025, and its profit (financial
performance including other comprehensive income), changes in equity and its cash flows for the year
ended on that date:-

a. In the case of the balance sheet, of the state of affairs of the company as at 31^st March 2025,

b. In the case of the statement of profit and loss, of the profit (financial performance including other
comprehensive income), changes in equity; and

c. In the case of the cash flow statement, of the cash flow statement for the year ended on that date.
Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section
143(10) of the Companies Act, 2013. 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 am
independent of the Company in accordance with the Code of ethics issued by the Institute of Chartered
Accountants of India together with the ethical requirements that are relevant to our audit of the financial
statements under the provisions of the Companies Act, 2013 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

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; we have determined that
there are no key audit matters to communicate in our report.

Other Information

The Company''s Board of Directors is responsible for the other information. The other information comprises
the information included in the annual report, 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.

Responsibility of Management 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),
changes in equity and cash flows 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. 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 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, the Board of Directors 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 but to do so.

Boards of Directors are 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 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 Standards on Auditing (''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 control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances. Under section 143(3} 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.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor''s Report) Order, 2020 (“the Order”), issued by the Government
of India - Ministry of Corporate Affairs in terms of sub-section (11) of section 143 of the Act, we
enclose in the”Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the said
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 purposes of our audit.

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

c. The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income),
the Statement of Changes In Equity and the Cash Flow Statement dealt with by this Report are
in agreement with the books of accounts;

d. In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting
Standards prescribed under Section 133 of the Act read with Companies (Indian Accounting
Standard), Rules 2015 as amended.

e. On the basis of the written representations received from the directors as on 31 March 2025,
taken on record by the Board of Directors, none of the directors is disqualified as on 31 March
2025, 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. With respect to the matter to be included in the Auditor''s Report under section 197(16), In our
opinion and according to the information and explanations given to us and after relying on the
certificate of company secretary, the remuneration paid by the Company to its directors during
the current year is in accordance with the provisions of section 197 of the Act. The remuneration
paid to any director is not in excess of the limit laid down under section 197 of the Act. The
Ministry of Corporate Affairs has not prescribed other details under section 197(16) which are
required to be commented upon by us.

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 its financial position.

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

iii. There has not been any occasion in case of the Company during the year under report to
transfer any sums to the investor education and protection fund. The question of delay in
transferring such sums does not arise.

iv. (a) The Management The Management has represented that, to the best of its knowledge and

belief, no funds (which are material either 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 the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, no funds (which
are material either 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 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;

(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(e), as provided under (a) and (b) above,
contain any material misstatement

For M/s. Bhatter and Associates
Chartered Accountants

Firm Reg. No.131411W
Sd/-

CA Gopal Bhatter
(Partner)

Place: Mumbai Membership No. 411226

Date: 30^th May 2025 UDIN: 25411226BMIQLU7958

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Mar 31, 2024

The Members of RISHAB SPECIAL YARNS LIMITED Report on the standalone Financial StatementsOpinion

We have audited the financial statements of RISHAB SPECIAL YARNS LIMITED (“the Company”), which comprise the balance sheet as at March 31, 2024, and the statement of profit and loss (including other comprehensive income), statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information (Collectively referred to as ''standalone financial statements'').

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 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 (financial position) of the Company as at March 31, 2024, and its profit (financial performance including other comprehensive income), changes in equity and its cash flows for the year ended on that date:-

a. In the case of the balance sheet, of the state of affairs of the company as at 31^st March 2024,

b. In the case of the statement of profit and loss, of the profit (financial performance including other comprehensive income), changes in equity; and

c. In the case of the cash flow statement, of the cash flow statement for the year ended on that date. Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. 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 am independent of the Company in accordance with the Code of ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013 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

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; we have determined that there are no key audit matters to communicate in our report.

Other Information

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the annual report, 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.

Responsibility of Management 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), changes in equity and cash flows 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. 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 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, the Board of Directors 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 but to do so.

Boards of Directors are 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 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 Standards on Auditing (''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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3} 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.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor''s Report) Order, 2020 (“the Order”), issued by the Government of India - Ministry of Corporate Affairs in terms of sub-section (11) of section 143 of the Act, we enclose in the”Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the said 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 purposes of our audit.

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

c. The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes In Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of accounts;

d. In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act read with Companies (Indian Accounting Standard), Rules 2015 as amended.

e. On the basis of the written representations received from the directors as on 31 March 2024, taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 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. With respect to the matter to be included in the Auditor''s Report under section 197(16), In our opinion and according to the information and explanations given to us and after relying on the certificate of company secretary, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under section 197(16) which are required to be commented upon by us.

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 its financial position.

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

iii. There has not been any occasion in case of the Company during the year under report to transfer any sums to the investor education and protection fund. The question of delay in transferring such sums does not arise.

iv. (a) The Management The Management has represented that, to the best of its knowledge

and belief, no funds (which are material either 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 the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, no funds (which are material either 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 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;

(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(e), as provided under (a) and (b) above, contain any material misstatement

For M/s. Bhatter and Associates Chartered Accountants

Firm Reg. No.131411W Sd/-

Rohit Kumar Tawari (Partner)

Place: Jaipur Membership No. 197557

Date: 30^th May 2024 UDIN: 24197557BKAERN7142

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Mar 31, 2014

We have audited the accompanying financial statements of Rishab Special Yarns Limited ("the Company"), which comprise the Balance Sheet as at March 31, 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

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Opinion

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

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

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

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

Report on Other Legal and Regulatory Requirements:

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.

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 How Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated 13 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 March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS'' REPORT

Statement on the Matters Specified in paragraph 4 & 5 of Companies (Auditors Report) order 2003 as referred to in our Report of even date under the heading "Report on Other Legal & Regulatory" requirements:

1. (a) The company has maintained proper records showing full particulars including quantitative details and situation of the Tangible Assets.

(b) As explained to us, the Tangible Assets have been physically verified by the management during the year at regular Intervals, 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) The company has decided to discontinue the manufacturing operations due to non viability and has disposed off its entire Tangible Assets except major part of Land & Building and some Furniture. Accordingly, the going concern status of the company has affected.

2. The Company did not have any inventory during whole of the year under audit.

3. (a) The company has not granted unsecured loans during the year to the persons specified under section 301 of The Companies Act 1956.

(b) The company has taken interest-free unsecured loans, repayable on demand, from three parties covered in the register maintained under section 301 of the Companies Art, 2013. The maximum amount involved during the year was Rs. 1,96,00,000/- and the year-end balance of loans taken from such parties was Rs. 1,76,27,951/-. As the loans are interest free and repayable on demand, sub clause (f) and (g) are not applicable.

4. In our opinion and according to the information and explanations give to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase and also 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 internal controls.

5. As explained to us, there has not been any transaction required to be entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- or more in respect of each such party.

6. In our opinion and according to the information and explanations given to us, the company has not accepted deposits from the public. Hence the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 2013 and the Rules framed there under are not applicable.

7. As explained to us, in view of no business activities being carried on by the company, no interna) audit was carried out.

8. As explained to us, there was no manufacturing activity during the year, as such the clause regarding maintenance of cost records U/s 209 (1) (d) of the Companies Act, 1956 is not applicable.

9. a. The company is generally regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues with appropriate authorities, wherever applicable to it.

b. According to the information and explanations given to us, as at 31st March, 2014, except a sum of Rs. 14623/- in respect of Sales Tax, no undisputed amounts payable in respect of income tax, wealth tax, service tax, sales tax, custom duty, excise duty and cess were in arrears for a period exceeding six months from the date they become payable.

c. As per records of the company and in accordance with the information and explanations given to us, there are no dues of income tax, custom duty, wealth tax, which have not been deposited on account of any dispute. However, in the case of excise duty and cess the particulars on account of dispute are reported herein below:

Name of Statute Nature of Period to Amount Forum Dues which the (Rupees amount in Lakh) relates

Excise & Customs Excise Duty 2002-2003 83.36 The Commissioner - (NCCD) (Appeals), Customs, Excise & Service Tax

Textile Textile 1989-1997 8.27 Rajasthan High Committee Committee Court Cess

10. The accumulated losses of the company at the end of the financial year are more than 50% of its net worth and though the company has not incurred cash losses during the year immediately preceding financial year, it has incurred cash losses during the year under report.

11. During the year the company has not availed any loan from financial institutions. There are no dues of Financial Institutions, Banks & Debenture Holders.

12. The company has not granted any loans and/or advances 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 benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

14. During the year, the company has not done any dealing/trading in shares, debentures and other securities.

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

16. During the year the company has not taken any term loan.

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

18. During the year, the company has not made any preferential allotment of shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The company has not issued any debentures.

20. During the year, the company has not raised any money by public issue.

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

For Jain Shrimal & CO. Chartered Accountants (FRN. 001704C)

[S.K. Jain] Place : Jaipur Partner Dated : 30.05.2014 (M. No. 010145)

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Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Rishab Special Yarns Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these 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''* 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 issuod 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 nvolves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

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

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

(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

As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act. we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order. 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 suDsection (3C) of section 211 of the Companies Act, 1956;

e) on the basis of written representations received from the directors as on March 31, 2013, and 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 clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

RE : RISHAB SPECIAL YARNS LIMITED, JAIPUR ANNEXURE TO THE AUDITOR''S REPORT

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

1. (a) The company has maintained proper records showing full particulars including quantitative details and situation of the angible Assets.

(b) As explained to us, the Tangible Assets have been physically verified by the management during the year at regular intervals, 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) The company has decided to discontinue the manufacturing operations due to non viability and has disposed off its entire Tangible Assets except major part of Land & Building and some Furniture. Accordingly, the going concern status of the company has affected.

2. The Company did not have any inventory during whole of the year under audit. i

3. (a) The company has not granted unsecured loans during the year to the persons specified under section 301 of The Companies Act 1956.

(b) The company has taken interest-free unsecured loans, repayable on demand, from four parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 2,25,78,117/- and the year end balance of loans taken from such parties was Rs. 2,00,85,360/-. As the loans are interest free and repayable on demand, sub clause (f) and (g) are not applicable.

4. In our opinion and according to the information and explanation give to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase and also 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 internal controls.

5. As explained to us, there has not been any transaction required to be entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- or more in respect of each such party.

6. In our opinion and according to the information and explanations given to us, the company has not accepted deposits from the public. Hence the provisions of Section 58A, 58Aa or any other relevant provisions of the Companies Act, 1956 and the Rules framed there under are not applicable.

7. As explained to us, in view of no business activities being carried on by the company, no internal audit was carried out.

8. As explained to us, there was no manufacturing activity during the year, as such the clause regarding maintenance of cost records U/s 209(1)(d) of the Companies Act, 1956 is not applicable.

9. a. The company is generally regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues with appropriate authorities, wherever applicable to it.

b. According to the information and explanations given to us, as at 31** March, 2013, except a sum of Rs. 14623/- in respect of Sales Tax, no undisputed amounts payable in respect of income tax, wealth tax, service tax, sales tax, custom duty, excise duty and cess were in arrears for a period exceeding six months from the date they become payable.

10. The accumulated losses of the company at the end of the financial year are more than 50% of its net worth and though the company has not incurred cash losses during the year under report, it has incurred cash losses during the immediately preceding financial year.

11. During the year the company has not availed any loan from financial institutions. There are no dues of Financial Institution, Banks & Debenture Holders.

12. The company has not granted any loans and/or advances 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 benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

14. During the year, the company has not done any dealing/trading in shares, securities, debentures and other investments.

15. According to the information and explanation given to us, the company has not given guarantees for loans taken by others from banks or financial institutions.

16. During the year the company has not taken any term loan.

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

18. During the year, the company has not made any preferential allotment of Shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The company has not issued any debentures.

20. During the year, the company has not raised any money by public issue.

21. In accordance with the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

FOR Jain Shrimal & CO.

CHARTERED ACCOUNTANTS

(FRN.001704C)

[S.K.JAIN]

Place: Jaipur PARTNER

Dated: 30/05/2013 (M. No. 010145)

---

Mar 31, 2011

We have audited the attached Balance Sheet of RISHAB SPECIAL YARNS LIMITED, JAIPUR as at 31st March 2011. and also the Profit & Loss Account for the year ended on that date annexed thereto and cash flow statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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 paragraphs 4 and 5 of the said order.

Further to our comments in the annexure referred to in the paragraph (1) above:

(i) 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.

(ii) In our opinion proper books of account as required by law have been maintained by the company so far as appears from our examination of such books.

(iii) 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.

(iv) In our opinion, the Balance Sheet, the Profit 8. Loss Account and Cash Flow Statement dealt by this report have been prepared in compliance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956..

(v) Based on representations made by all the directors of the company and the information and explanation as made available, directors of the company do not prima facie have any disqualification as referred to in clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read 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:

(a) In the case of Balance Sheet, of the state of affairs as at 31st March, 2011 and

(b) In the case of Profit and Loss Account, 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.

ANNEXURE TO THE AUDITORS REPORT (Referred to in Paragraph 3 of our report of even date)

1. (a) The company has maintained proper records showing full particulars including quantitative details and situation of the Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management during the year at regular intervals, 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) The company has decided to discontinue the manufacturing operations due to non viability and has disposed off its entire fixed assets except major part of Land & Building and some Furniture. Accordingly, the going concern status of the company has been affected.

2. The Company did not have any inventory during whole of the year under audit.

3. (a) The company has not granted unsecured loans during the year.

(b) The company has taken interest-free unsecured loans, repayable on demand, from four parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 26158787/- and the year end balance of loans taken from such parlies was Rs. 22126526/-. As the loans are interest free and repayable on demand, sub clause (f) and (g) are not applicable.

4. In our opinion and according to the information and explanation give to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase and also 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 internal controls.

5. As explained to us, there has not been any transaction required to be entered in the register maintained under section 301 of the Companies Act, 1956 aggregating during the year to Rs. 5,00,000/- or more in respect of each such party.

6. In our opinion and according to the information and explanations given to us, the company has not accepted deposits from the public. Hence the provisions of Section 58A, 58Aa or any other relevant provisions of the Companies Act, 1956 and the Rules framed there under are not applicable.

7. As explained to us, in view of no business activities being carried on by the company, no internal audit was carried out.

8. As explained to us, there was no manufacturing activity during the year, as such the clause regarding maintenance of cost records U/s 209( 1) (d) of the Companies Act, 1956 is not applicable.

9. a. The company is generally regular in depositing undisputed statutory dues including provident fund,

employees state insurance, income tax, sales tax, wealth tax, service fax, custom duty, excise duty, cess and other material statutory dues with appropriate authorities, wherever applicable to it.

b. According to the information and explanations given to us, as at 31st March, 2011, except a sum of Rs. 14623/- in respect of Sales Tax, no undisputed amounts payable in respect of income tax, wealth tax, service tax, sales tax, custom duty, excise duty and cess were in arrears for a period exceeding six months from the date they become payable.

c. As per records of the company and in accordance with the information and explanation given to us, there are no dues of income tax, custom duty, wealth tax, which have not been deposited on account of any dispute. However, in the case of excise duty and cess the particulars on account of dispute are reported herein below:

Name of Statute Nature of Period to which the Amount Forum Dues amount relates

Excise & Customs Excise Duty 2002-2003 83.36 Customs, Excise & (NCCD) Service Tax Appellate Tribunal

Textile Committee Textile 1989-1997 8.27 Rajasthan High Court Committee Cess

10. The accumulated losses of the company at the end of the financial year are more than 50% of the net worth of the company and the company has incurred cash losses during the year and also in the immediately preceding financial year.

11. During the year the company has not availed any loan from financial institutions. There are no dues of Financial Institution, Banks & Debenture Holders. The company has not issued any debentures.

12. The company has not granted any loans and/or advances 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 benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

14. During the year, the company has not done any dealing/trading in shares, securities, debentures and other investments.

15. According to the information and explanation given to us, the company has not given guarantees for loans taken by others from banks or financial institutions.

16. During the year the company has not taken any term loan.

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

18. During the year, the company has not made any preferential allotment of shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The company has not issued any debentures.

20. During the year, the company has not raised any money by public issue.

21. In accordance with the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

FOR N. C. DHADDA & CO. CHARTERED ACCOUNTANTS (Regn. No. 000986C)

[S.K.JAIN] PARTNER (M. No. 010145)

Place: Jaipur Dated: 27.05.2011

---

Mar 31, 2010

We have audited the attached Balance Sheet of RISHAB SPECIAL YARNS LIMITED, JAIPUR as at 31st March 2010, and also the Profit & Loss Account for the year ended on that date annexed thereto and cash flow statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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 paragraphs 4 and 5 of the said order.

Further to our comments in the annexure referred to in the paragraph (1) above:

{I) 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.

(ii) In our opinion proper books of account as required by law have been maintained by the company so far as appears from our examination of such books.

(iii) 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.

(iv) In our opinion, the Balance Sheet, the Profit 8. Loss Account and Cash Flow Statement dealt by this report have been prepared in compliance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956..

(v) Based on representations made by all the directors of the company and the information and explanation as made available, directors of the company do not prima facie have any disqualification as referred to in clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(vi) We refer to Note No. 2 in the financial statements. In view of continued losses and unavibility of the business, the management discontinued the business operations of the company and sold entire remaining plant & machinery & misc. fixed assets except for land and building & some furniture & fixtures. These factors, along with other matters as set forth in the Note No. 2 may unable the company to continue as a going concern.

(vii) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the notes thereon, give the information required by the Companies Act 1956 in the manner so required and subject to para (vi) above, give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) In the case of Balance Sheet, of the state of affairs as at 31st March, 2010; and

(b) In the case of Profit and Loss Account of the LOSS 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.

ANNEXURE TO THE AUDITORS REPORT

(Referred to In Paragraph 3 of our report of even date)

1. (a) The company has maintained proper records showing full particulars including quantitative details and situation of the Fixed Assets.

(b) As explained to us, the fixed assets have been physically verified by the management during the year of regular intervals, which in our opinion is reasonable, having regard to the size of the company and nature of its assets. No material discrepancies were notice on such physical verification.

(c) The company has decided to discontinue the manufacturing operations of the company due to non viability and has disposed off the entire plant & machinery of the company. Accordingly, the going concern status of the company has been affected.

2. The Company did not have any inventory during whole of the year under audit.

3. (a) The company has granted interest free unsecured loans, repayable on demand, to one party listed in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 4,79,000/- and the year end balance of such loans was Rs. NIL. As the loans are interest free and repayable on demand, sub clause (b), (c) and (d) are not applicable.

(b) The company has taken interest-free unsecured loans, repayable on demand, from four parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 27267737/- and the year end balance of loans taken from such parties was Rs. 26165237/-. As the loans are interest free and repayable on demand, sub clause (f) and (g) are not applicable.

4. In our opinion and according to the information and explanation give to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase and also 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 internal controls.

5. As explained to us, there has not been any transaction required to be entered in the register maintained under section 301 of the Companies Act, 1956 and aggregating during the year to Rs. 5,00,000/- or more in respect of each such party.

6. In our opinion and according to the information and explanations given to us, the company has not accepted deposits from the public. Hence the provisions of Section 58A, 58Aa or any other relevant provisions of the Companies Act, 1956 and the Rules framed there under are not applicable. As informed to us in companys case, no order has been passed by the Company Law Board or National Company Law Tribunal or any court or any other tribunal.

7. As explained to us, in view of no business activities, no internal audit was carried out.

8. As explained to us, there was no manufacturing activity during the year, as such the clause regarding maintenance of cost records U/s 209(1) (d) of the Companies Act, 1956 is not applicable.

9. a. The company is generally regular in depositing undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues with appropriate authorities, wherever applicable to it.

b. According to the information and explanations given to us, as at 31st March, 2010, except a sum of Rs. 14623/- in respect of Sales Tax, no undisputed amounts payable in respect of income tax, wealth tax, service tax, sales tax, custom duty, excise duty and cess were in arrears for a period exceeding six months from the date they become payable.

c. As per records of the company and in accordance with the information and explanation given to us, there are no dues of income tax, custom duty, wealth tax, which have not been deposited on account of any dispute. However, in the case of excise duty and cess the particulars on account of dispute are reported herein below:

Name of Statute Nature of Period to which the Amount Forum Dues amount relates

Excise & Customs Excise Duty 2002-2003 83.36 Customs, Excise & (NCCD) Service Tax Appellate Tribunal

Textile Committee Textile 1989-1997 8.27 Rajasthan High Court Committee Cess

10. The accumulated losses of the company at the end of the financial year are more than 50% of the net worth of the company and the company has incurred cash losses during the year and also in the immediately preceding financial year.

11. During the year the company has not availed any loan from financial institutions. There are no dues of Financial Institution, Banks & Debenture Holders. The company has not issued any debentures.

12. The company has not granted any loans and/or advances 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 benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

14. During the year, the company has not done any dealing/trading in shares, securities, debentures and ther investments.

15. According to the information and explanation given to us, the company has not given guarantees for loans taken by others from banks or financial institutions.

16. During the year the company has not taken any term loan.

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

18. During the year, the company has not made any preferential allotment of shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. During the year, the company has not issued any debentures.

20. During the year, the company has not raised any money by way of public issue.

21. In our opinion, on the basis of audit conducted by us and in accordance with the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

FOR N. C. DHADDA & CO.

CHARTERED ACCOUNTANTS

(Regn. No. 000986C)

[ S.K.JAIN ]

PARTNER

(M. No. 010145)

Place: Jaipur

Dated :20th August, 2010

---

Mar 31, 2009

We have audited the attached balance sheet of Rishab Special Yarns Limited as at 31st March, 2009 the Profit & Loss Account for the year ended on that date annexed thereto and the cash flow statement for the year ended on that date. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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 paragraphs 4 and 5 of the said order.

1. Further to our comments in the annexure referred to in the paragraph (1) above:

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

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

(c) The balance sheet, the profit & loss Account and cash flow statement dealt with by this report are in agreement with the books of account;

(d) in our opinion, the balance sheet, the profit & loss Account and cash flow statement dealt with by this report have been prepared in compliance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

(e) based on representations made by all the directors of the company and the information and explanation as made available, directors of the company do not prima facie have any disqualification as referred to in clause (g) of sub- section (1) of section 274 of the Companies Act, 1956;

(f) We refer to Note No.2 in the financial statements. In view of continued losses and unvaibilHy of the business, the management discontinued the business operations of the company and sold entire remaining plant & machinery & misc. fixed assets except for land & building . These factors, alongwith other matters as set forth in the Note No.2 may unable the company to continue as a going concern.

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

i. in the case of balance sheet, of the state of affairs as at 31 st March, 2009; and

ii. in the case of profit and loss account, of the loss 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 dqte) To The Members of Rishab Special Yarns Limited Jaipur

i. a) As informed by the management, the proper records of fixed assets showing full particulars including quantitative details and location of fixed assets are under updation and compilation.

b) As explained to us, the fixed assets have been physically verified by the management during the year at regular intervals, which in our opinion is reasonable, having regard to the size of the company and nature of its assets. No material discrepancies were notice on such physical verification.

c) The company has decided to discontinue the manufacturing operations of the company due to non viability and has disposed off the entire plant & machinery of the company. Accordingly, the going concern status of the company has been affected.

ii. 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 information and explanation given to us, the procedures of physical verification of the company are reasonable and adequate having regard to the size of the company and nature of its business.

c) in our opinion and according to the information and explanation given to us, the company is maintaining proper records of inventory. The discrepancies noticed on such verification between physical stocks and book records were not material and have been properly dealt with in the books of accounts.

iii. a. The company has granted interest free unsecured loans, repayable on demand, to one party listed in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 700000/- and the year end balance of such loans was Rs. 479000/-. As the loans are interest free and repayable on demand, sub clause (b),(c) and (d) are not applicable. b. The company has taken interest-free unsecured loans, repayable on demand, from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 2,43,90,727/- and the year end balance of loans taken from such parties was Rs. 2,16,92,727/-. As the loans are interest free and repayable on demand, sub clause (f) and (g) are not applicable.

iv. In our opinion and according to the information and explanation give to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business with regard to purchase and also 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 internal controls.

v. As explained to us, there has not been any transaction required to be entered in the register maintained under section 301 of the Companies Act, 1956 and aggregating during the year to Rs. 5,00,000/- or more in respect of each such party.

vi. in our opinion and according to the information and explanations given to us, the company has not accepted deposits from the public. Hence the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956, and the Rules framed there under are not applicable. In companys case, no order has been passed by the Company Law Board or National Company Law Tribunal or any court or any other tribunal. As informed to us , no order has been passed by the Company Law Board.

vii. As explained to us, in view of no business activities, no internal audit was carried out.

viii. As explained to us, there was no manufacturing activity during the year, as such the clause regarding maintenance of cost records u/s 209(1 )(d) of the companies Act, 1956 is not applicable.

ix. a. The company is generally regular in depositing undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty cess and other material statutory dues with appropriate authorities, wherever applicable to it.

b. According to the information and explanations given to us, as at 31st March, 2009, except a sum of Rs. 14623/- in respect of Sales Tax, no undisputed amounts payable in respect of income tax, wealth tax, service tax, sales tax, custom duty, excise duty and cess were in arrears for a period exceeding six months from the date they became payable.

c. As per records of the company and in accordance with the information and explanation given to us, there are no dues of income tax, custom duty, wealth tax, which have not been deposited on account of any dispute. However, in the case of excise duty and Cess the particulars on account of dispute are reported herein below:-

Name of Nature of dues Period to which the Statute amount relates

Excise & Excise Duty(NCCD) 2002-2003 Customs

Textile Textile Committee 1989-1997 Committee Cess (Cess), Rules



Name of Statue Amount Forum

Excise & Customs 83.36 Customs, Excise & Service Tax Appellate Tribunal

Textile Committee (Cess), Rules 8.27 Rajasthan High Court

x. The accumulated losses of the company at the end of the financial year are more than 50% of the net worth of the company and the company has incurred cash losses during the year and also in the immediately preceding financial year.

xi. During the year the company has not availed any loan from financial institutions. There are no dues of Financial Institution, Banks & debenture holders.The company has not issued any debentures.

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

xiv. During the year, the company has not done any dealing/trading in shares, securities, debentures and other investments.

xv. According to the information and explanation given to us, the company has not given guarantees for loans taken by others from banks or financial institutions. xvi. During the year the company has not taken any term loan .

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

xviii. During the year, the company has not made any preferential allotment of shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

xix. During the year, the company has not issued any debentures.

xx. During the year, the company has not raised any money by way of public issue.

xxi. In our opinion, on the basis of audit conducted by us and in accordance with the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit. For R.MohnoU Co.

Chartered Accountants Place: Jaipur (Narender Mital)

Dated: 11/11/2009 Partner

M.No.72715