Auditor Report of Star Paper Mills Ltd.

Mar 31, 2025

We have audited the accompanying Financial Statements of Star Paper Mills 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 material accounting policies and Other Explanatory Notes for the year ended on that date (hereinafter referred to
as "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 the 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, 2025, its profits, total comprehensive Income, changes in equity and its cash
flows 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 Act.
Our responsibilities under those Standards are further described in the Auditors'' Responsibility 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 ethical requirements that are relevant to our audit of the
financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtained by
us is sufficient and appropriate to provide a basis for our audit opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, 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 for incorporation in our report:

Key Audit Matters

Addressing the Key Audit Matters

Evaluation of provisions and Contingent Liabilities: Provisions and liabilities are recognised in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability requires the application of judgement to existing facts and circumstances. There are also a number of litigations including direct and indirect taxes, various claims, etc. pending before various forums against the Company. The management''s judgement is required for estimating the amount to be provided and/or disclosed as contingent liability.

Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of recognition of provisions and disclosure of contingent liability includes the following: • We have obtained an understanding of the Company''s internal instructions and procedures in respect of estimation, assessment and disclosure of contingent liabilities; • Understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases;

Key Audit Matters	Addressing the Key Audit Matters
We identified this as a key audit matter because the estimates and assessment with respect to these involve a significant degree of management''s judgement, interpretations, and may therefore require adequate attention to arrive at the required conclusion. (Refer Note No. 39 to the Financial Statements, read with the Material Accounting Policy No.35. 3.14)	• Reviewed the estimation made by the management for measurement, recognition of provisions considering the past events, risks and uncertainties surrounding the obligations and probability of the outflow of resources towards the possible obligation; • Discussed with the management regarding any material developments and status of matters requiring legal clarification; • Read various correspondences and related documents pertaining to litigations involved and relevant external legal opinions obtained by the management and performed substantive procedures on estimation supporting the disclosure of contingent liabilities; • Reviewed the management''s assessments of those matters which have not been provided for or disclosed as contingent liability since the probability of material outflow has been considered to be remote; • Reviewed the adequacy and completeness of disclosures; Based on the above procedures performed, the estimation of provision and disclosures for contingent liabilities have been considered to be adequate and reasonable.
Verification of Inventories and Valuation thereof The total inventory of the Company amounts to Rs. 13,538.08 Lakhs (as on March 31,2025) (Refer Note 5 and 51.1 read with Material Accounting Policy No. 35.3.10). Existence of Inventories and valuation thereof was focus area of audit considering that the amount involved therein was substantial and the nature of operations of the Company.	Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of determination of year-end inventory and valuation thereof include the following: • Ensuring the effectiveness of the design, implementation and maintenance of controls over inventory and in system and procedure for conducting the physical verification and testing these controls being operated effectively. • Observing the verification of Inventories at the year end undertaken by the management and evaluation of procedures and documentation in this aspect. • Obtaining and reviewing the necessary evidences, working papers and documents for the physical verification carried out as above. • Verifying the valuation process/methodology and checks being performed at multiple levels and ensuring that the valuation is consistent with and as per the policy followed in this respect. Based on the above procedures performed, the determination of year-end inventory and valuation thereof have been considered to be adequate and reasonable.

Information Other than the Financial Statements and Auditors'' Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the information
included in the Annual Report.

Our opinion on the Financial Statements does not cover the other information and we do not express any form of assurance s
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 conclude that there is a material misstatement of this other information, we are
required to report that fact.

We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the 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 state of affairs (financial
position), Profit or Loss (financial performance including other comprehensive income), Changes in Equity and Cash Flows of the
Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards
specified under section 133 of the act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act
for safeguarding of the assets of the company and for preventing and detecting frauds and other irregularities; selection and
application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy
and completeness of the accounting records, relevant to the preparation and presentation of the 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.

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

Auditors'' Responsibility 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 auditors'' 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 Standard on Auditing (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 control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion
on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such
controls;

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

• 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.

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

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

II. Further to our comments in the annexure referred to in the paragraph above, 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 except for the matters stated in paragraph III(f) below on reporting under Rule 11(g)
of the Companies (Audit and Auditors) Rules, 2014, as amended from time to time;

c. The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), the 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 Indian Accounting Standards specified under
Section 133 of the Act, read with Rule 7 of the Companies (Indian Accounting Standards) Rules, 2015, as amended
from time to time;

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

f. With respect to the maintenance of accounts and other matters connected therewith, reference is invited to
paragraph II(b) above on reporting under section 143(3)(b) of the Act; and

g. With respect to the adequacy of the internal financial controls with reference to financial statements of the Company
and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses
an modified opinion on the adequacy and operating effectiveness of the Company''s internal control with reference
to financial statements.

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

a. The Company has disclosed the impact of pending litigations on its financial position in its financial statements-
Refer Note no. 39 of the financial statements;

b. The Company did not have any material foreseeable losses against long-term contracts, including derivative
contracts and thereby requirement for making provision in this respect is not applicable to the company;

c. There has been no delay in transferring amounts required to be transferred, to the Investor Education and Protection
Fund by the Company during the year;

d. i) The Management has represented that, to the best of its knowledge and belief as disclosed in Note No.48 to the

financial statements, 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(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;

ii) The Management has represented, that, to the best of its knowledge and belief as disclosed in Note No.48 to the
financial statements, no funds (which are material either individually or in the aggregate) have been received by
the Company from any person(s) or entity(ies), 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; and

iii) 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 (i) and (ii) above, contain any material misstatement.

e. The dividend declared or paid during the year by the Company is in compliance with section 123 of the Act.

f. Based on our examination which included test checks, except for the instances mentioned below, the Company has
used accounting software for maintaining its books of account, which have a feature of recording audit trail (edit
log) facility and transactions recorded in the respective software as:

• Audit trail feature on data changes was enabled at application level of the accounting software. However,
while changing the master data only latest data is stored. Further audit trail in all cases, system saves User ID
and date except time.

• The feature of recording audit trail (edit log) facility has also been enabled at database level to log any direct
data changes for the accounting software.

Audit trail (edit log) facility was enabled and operated throughout the year for the accounting software and we did
not come across any instance of the audit trail feature being tampered with during the course of our audit.

As per proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1,2023 and reporting
under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the
statutory requirements for record retention, audit trail on data changes are maintained since the implementation of
the software.

IV. With respect to the reporting under Section 197 (16) of the Act to be included in the Auditors'' Report, in our opinion and
according to the information and explanations given to us, the Remuneration (including Sitting fees) paid by the Company
to its Directors during the current year is in accordance with the provisions of Section 197 of the Act and is not in excess
of the limit laid down therein.

For Lodha & Co., LLP

Chartered Accountants
Firm''s ICAI Registration No.:301051E/E300284

Place: Kolkata Vikram Matta

Date: May 29, 2025 Partner

Membership No:054087
UDIN: 25054087BMNWEQ7485

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Mar 31, 2024

To the Members of Star Paper Mills Limited Report on the Financial Statements Opinion

We have audited the accompanying Financial Statements of Star Paper Mills 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 material accounting policies and Other Explanatory Notes for the year ended on that date (hereinafter referred to as "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 the 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, its profits, total comprehensive Income, changes in equity and its cash flows 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 Act. Our responsibilities under those Standards are further described in the Auditors'' Responsibility 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 ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, 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 for incorporation in our report:

Key Audit Matters

Addressing the Key Audit Matters

Evaluation of provisions and Contingent Liabilities: Provisions and liabilities are recognised in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability requires the application of judgement to existing facts and circumstances. There are also a number of litigations including direct and indirect taxes, various claims, etc. pending before various forums against the Company.

Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of disclosure of contingent liability and recognition of provisions includes the following: • We have obtained an understanding of the Company''s internal instructions and procedures in respect of estimation, assessment and disclosure of contingent liabilities; • Understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases; • Reviewed the estimation made by the management for measurement, recognition of provisions considering the past events, risks and uncertainties surrounding the obligations and probability of the outflow of resources towards the possible obligation; • Discussed with the management regarding any material developments and status of matters requiring legal clarification;

Key audit Matters	Addressing the Key Audit Matters
The management''s judgement is required for	• Read various correspondences and related documents pertaining
estimating the amount to be provided and/or	to litigations involved and relevant external legal opinions obtained
disclosed as contingent liability.	by the management and performed substantive procedures on
We identified this as a key audit matter	estimation supporting the disclosure of contingent liabilities;
because the estimates and assessment with	• Examined management''s judgements and assessments in respect of
respect to these involve a significant degree of management''s judgement, interpretations, and	whether provisions are required;
may therefore require adequate attention to arrive	• Reviewed the management''s assessments of those matters which
at the required conclusion. (Refer Note No. 40 to the Financial Statements,	have not been provided for or disclosed as contingent liability since the probability of material outflow has been considered to be remote;
read with the Material Accounting Policy No.35. 3.14)	• Reviewed the adequacy and completeness of disclosures;
	• Based on the above procedures performed, the estimation of provision and disclosures for contingent liabilities have been considered to be adequate and reasonable.
Verification of Inventories and Valuation thereof	Our Audit procedures based on which we arrived at the conclusion
The total inventory of the Company amounts to	regarding reasonableness of determination of year-end inventory and
Rs. 11,517.28 Lakhs (as on March 31,2024) (Refer	valuation thereof include the following:
Note 5 and 51.1 read with Material Accounting	• Ensuring the effectiveness of the design, implementation and
Policy No. 35.3.10).	maintenance of controls over inventory and in system and procedure
Existence of Inventories and valuation thereof	for conducting the physical verification and testing these controls
was focus area of audit considering that the	being operated effectively.
amount involved therein was substantial and the	• Observing the verification of Inventories at the year end undertaken by
nature of operations of the Company. Physical verifications in all the locations have	the management and evaluation of procedures and documentation in this aspect.
been conducted by the management at the year	• Obtaining and reviewing the necessary evidences, working papers
end.	and documents for thephysical verification carried out as above. Verifying the valuation process/methodology and checks being performedat multiple levels and ensuring that the valuation is consistent with and as per the policy followed in this respect.

Information Other than the Financial Statements and Auditors'' Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report.

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 conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the 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 state of affairs (financial position), Profit or Loss (financial performance including other comprehensive income), Changes in Equity and Cash Flows of the Company in accordance with the

accounting principles generally accepted in India, including the Indian Accounting Standards specified under section 133 of the act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the 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.

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

Auditors'' Responsibility 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 auditors'' 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 Standard on Auditing (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, forgery, intentional omissions, misrepresentations, or the override of internal control;

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

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

• 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.

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

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

II. Further to our comments in the annexure referred to in the paragraph above, 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 except for the matters stated in paragraph 3(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014, as amended from time to time;

c) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), the 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 Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time;

e) 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 directors are 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 maintenance of accounts and other matters connected therewith, reference is invited to paragraph 2(b) above on reporting under section 143(3)(b) of the Act; and

g) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal control with reference to financial statements.

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

a) The Company has disclosed the impact of pending litigations on its financial position in its financial statements-Refer Note no. 40 of the financial statements;

b) The Company did not have any material foreseeable losses against long-term contracts, including derivative contracts and thereby requirement for making provision in this respect is not applicable to the company;

c) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company;

d)i) The Management has represented that, to the best of its knowledge and belief as disclosed in Note No.48 to the financial statements, 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(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;

ii) The Management has represented, that, to the best of its knowledge and belief as disclosed in Note No.48 to the financial statements, no funds (which are material either individually or in the aggregate) have been received by the Company from any person(s) or entity(ies), 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; and

iii) 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 (i) and (ii) above, contain any material misstatement.

Place: Kolkata Date: May 24, 2024

e) The dividend declared or paid during the year by the Company is in compliance with section 123 of the Act.

f) Based on our examination which included test checks, the Company has used accounting software incorporating all the financial and other transactions involving various operational areas and functions for maintaining its books of account which, except in respect of master data, have the feature of recording audit trail (edit log) facility at application level. The feature of audit trail (edit log) is coded in the said software via programs, and it is not possible to ascertain whether audit trail (edit log) facility was operating throughout the year for all relevant transactions. Audit trail (edit log) with respect to the direct changes at database level have not been enabled.

In respect of the above software, to the extent applicable as above, we have, however, not come across any instance of the same being tampered with.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from 1st April, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, on preservation of audit trail (edit log) as per the statutory requirements for record retention is not applicable for the financial year ended 31st March, 2024.

IV. With respect to the reporting under Section 197 (16) of the Act to be included in the Auditors'' Report, in our opinion and according to the information and explanations given to us, the Remuneration (including Sitting fees) paid by the Company to its Directors during the current year is in accordance with the provisions of Section 197 of the Act and is not in excess of the limit laid down therein.

For Lodha & Co, LLP

Chartered Accountants Firm''s ICAI Registration No.:301051E/E300284

Boman R. Parakh

Partner

Membership No: 053400 UDIN: 24053400BKFCGA5840

---

Mar 31, 2023

We have audited the accompanying Financial Statements of Star Paper Mills Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2023, 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 Notes for the year ended on that date (hereinafter referred to as “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 the 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, 2023, its profits, total comprehensive Income, changes in equity and its cash flows 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 Act. Our responsibilities under those Standards are further described in the Auditors’ Responsibility 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 ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, 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 for incorporation in our report:

Evaluation of provisions and Contingent Liabilities:

There are a number of litigations including direct and indirect taxes, various claims, etc. pending before various forums against the Company and the management’s judgement is required for estimating the amount to be provided and/or disclosed as contingent liability.

We identified this as a key audit matter because the estimates and assessment with respect to these involve a significant degree of management''s judgement, interpretations, and may therefore require adequate attention to arrive at the required conclusion.

(Refer Note No. 38 to the Financial Statements, read with the Significant Accounting Policy No. 3.12)

Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of

disclosure of contingent liability and recognition of provisions includes the following:

• We have obtained an understanding of the Company’s internal instructions and procedures in respect of estimation, assessment and disclosure of contingent liabilities;

• Understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases;

• Discussed with the management regarding any material developments thereto and latest status of legal matters;

• Read various correspondences and related documents pertaining to litigations involved and relevant external legal opinions obtained by the management and performed substantive procedures on estimation supporting the disclosure of contingent liabilities;

• Examined management’s judgements and assessments in respect of whether provisions are required;

• Reviewed the management’s assessments of those matters which have not been provided for or disclosed as contingent liability since the probability of material outflow has been considered to be remote;

• Reviewed the adequacy and completeness of disclosures;

Based on the above procedures performed, the estimation of provision and disclosures for contingent

liabilities have been considered to be adequate and reasonable.

Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of determination of year-end inventory and valuation thereof include the following:

Verification of Inventories and Valuation thereof

The total inventory of the Company amounts to '' 9558.20 Lakhs (as on March 31, 2023) (Refer note 5 and 50.1 read with accounting policy number 3.8).

Existence of Inventories and valuation thereof was focus area of audit considering that the amount involved therein was substantial and the nature of operations of the Company.

Physical verifications in all the locations have been conducted by the management at the year end.

• Ensuring the effectiveness of the design, implementation and maintenance of controls over inventory and in system and procedure for conducting the physical verification and testing these controls being operated effectively.

• Observing the verification of Inventories at the year end undertaken by the management and evaluation of procedures and documentation in this aspect.

• Obtaining and reviewing the necessary evidences, working papers and documents for the physical verification carried out as above.

Verifying the valuation process/methodology and checks being performed at multiple levels and ensuring that the valuation is consistent with and as per the policy followed in this respect.

Information Other than the Financial Statements and Auditors’ Report Thereon

The Company’s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report.

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 conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

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

The Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act,20i3 (“the Act”) with respect to the preparation of these Financial Statements that give a true and fair view of the state of affairs (financial position), Profit or Loss (financial performance including other comprehensive income), Changes in Equity and Cash Flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under section 133 of the act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the 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.

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

Auditors’ Responsibility 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 auditors’ 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 Standard on Auditing (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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls;

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

• 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.

Other Matters

The comparative financial information of the company for the year ended 31^st March,2022 included in these Ind AS Financial Statement, is based on the Financial Statements for the year ended 31^st March, 2022 audited by the predecessor auditor, M/s. Jain Pramod Jain and Co., an independent firm of Chartered Accountants, whose report for the year ended 31^st March, 2022 dated 27^th May, 2022 expressed unmodified opinion on those Financial Statements. Reliance has been placed by us on the said Financial Statements and the report issued thereupon for the purpose of these Financial Statements and the report issued by us.

Our opinion is not modified in respect of the above matter.

Report on Other Legal and Regulatory Requirements

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

II. Further to our comments in the annexure referred to in the paragraph above, 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 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 Indian Accounting Standards specified under Section 133 of the Act, read with Rule

7 of the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time;

e) On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors are disqualified as on March 31, 2023 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of

the Company’s internal control with reference to financial statements.

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

a) The Company has disclosed the impact of pending litigations on its financial position in its financial statements-Refer Note no. 38 of the financial statements;

b) The Company did not have any material foreseeable losses against long-term contracts, including derivative contracts and thereby requirement for making provision in this respect is not applicable to the company;

c) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company;

d) i) The Management has represented that, to the best of its

knowledge and belief as disclosed in Note No.46 to the financial statements, 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(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

Place: Kolkata Date: May 29, 2023

whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

ii) The Management has represented, that, to the best of its knowledge and belief as disclosed in Note No.46 to the financial statements, no funds (which are material either individually or in the aggregate) have been received by the Company from any person(s) or entity(ies), 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; and

iii) 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 (i) and (ii) above, contain any material misstatement.

e) The dividend declared or paid during the year by the Company is in compliance with section 123 of the Act.

f) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) is applicable with effect from April 1,2023 to the Company, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31,2023.

IV. With respect to the reporting under Section 197 (16) of the Act to be included in the Auditors’ Report, in our opinion and according to the information and explanations given to us, the Remuneration (including Sitting fees) paid by the Company to its Directors during the current year is in accordance with the provisions of Section 197 of the Act and is not in excess of the limit laid down therein.

For Lodha & Co.

Chartered Accountants Firm’s ICAI Registration No.:301051E

Boman R. Parakh

Partner

Membership No: 053400 UDIN: 23053400BGSCNB6971

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Mar 31, 2018

INDEPENDENT AUDITORS'' REPORT

To The Members of Star Paper Mills Limited Report on the Ind AS Financial Statements

We have audited the accompanying Ind AS financial Statement of Star Paper Mills Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

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 Ind AS financial statements that give a true and fair view of the state of affairs(financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these Ind AS 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 of the Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Ind AS financial statements are free from material misstatement.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs (financial position) of the Company as at 31st March, 2018, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Other Matter

The comparative financial information of the Company for the year ended 31st March 2017 and the transition date opening Balance Sheet as at 1st April 2016 included in these Ind AS financial Statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rule, 2006 audited by Lodha & Co. Chartered Accountants for the year ended 31.03.2016 and 31.03.2017, whose reports dated 25.05.2016 and 25.05.2017 respectively expressed an unmodified opinion on those financial statements as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind As, which have been audited by us. Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

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

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

d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act.

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

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

g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, 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 Ind AS 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 no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

	For JAIN PRAMOD JAIN & CO.
	Chartered Accountants)
	Firm Registration No. 016746 N
	(P. K. JAIN)
	Partner
	M. No. 010479
Camp: Kolkata
Date: 21.05.2018

ANNEXURE ''A'' TO INDEPENDENT AUDITORS'' REPORT OF STAR PAPER MILLS LIMITED

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

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

(b) Fixed assets have been physically verified by the management according to the regular programme of periodical verification in phased manner which in our opinion is reasonable having regard to the size of the company and the nature of its fixed assets. No material discrepancies were noticed on such verification;

(c) The title deeds of immovable properties are held in the name of the company.

ii. The inventories of the Company at all its locations (except stock in transit) have been physically verified by the management at reasonable intervals and the

discrepancies which were noticed on physical verification of inventory as compared to book records were not material;

iii. The Company has not granted any loan to companies, firms, or other parties covered in the Register maintained under section 189 of the Act. Therefore the

provisions of clause 3 (iii) of the order are not applicable to the company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, the company has complied with provisions of section 1 85 and 186 of the Com-

panies Act, 2013 with respect of loans, investments, guarantees and securities..

v. The Company has not accepted any deposit from public.

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

vii. (a) According to the information and explanations and records of the Company, the company is regular in depositing undisputed statutory dues including

Provident Fund, Employees'' State Insurance, Income tax, Sales tax, Service tax, Custom Duty, Excise Duty, Value Added Tax, Cess and other statutory dues with the appropriate authorities. There are no arrears of outstanding statutory dues for a period of more than six months from the date they became payable as on 31st March, 2018;

(b) According to the records and information and explanations given to us, there are no dues in respect of custom duty that have not been deposited on account of any dispute. In our opinion and according to the information and explanations given to us, the dues in respect of income tax or sales tax or service tax or excise duty or value added tax that have not been deposited with the appropriate authority on account of dispute and the forum where the dispute is pending are given below:

Name of Statute	Nature of Dues	Amount involvec (Rs. in Lacs)	1 Period to which it relates to	Forum where matter is pending
The U.P. Act, 2008	VAT	19.87	F.Y.-2010-2011 2011-2012	Additional Commissioner (Appeals)
	VAT	24.40	2009-10	Tribunal
The Central Sales Tax Act, 1 956	Sales Tax	4.29	1996-1997	High Court
	Sales Tax	406.00	1995-1996	Tribunal
The Central Excise Act	Excise Duty	37.55	2009-2010 to 2011-12	CESTAT, Nzaew Delhi
UP Krishi Mandi Adiniyam, 1965	Interest on Mandi Tax	33.81	01.01.1993 to 31.12.2013	High Court
	Mandi Tax	560.72	2004-2005 to 2015-2016	High Court

viii. The Company has not defaulted in repayment of loans or borrowings to banks.

ix. The Company did not raise any money by way of initial/further public offer(including debt instruments) and term loans.

x. Based upon the audit procedure performed and information and explanation given to us, we report that no fraud by the company or any fraud on the company by its officers or employees has been noticed or reported during the course of our audit.

xi. Managerial Remuneration has been paid or provided in accordance with the requisite approvals mandated by the provision of Section 197 read with schedule V of the Companies Act, 2013.

xii. Provision of Nidhi Company is not applicable to the Company..

xiii. According to the information and explanation give to us and based on our examination of the records of the company, all transactions with the related parties are in compliance with Section 177 and 188 of the Companies Act, 2013 and the details have been disclosed in the financial statements, etc as required by the applicable accounting standard.

xiv. The company has not made any preferential allotment or private placements of shares or fully or partly convertible debentures during the year under review.

xv. The company has not entered into any non-cash transaction with Directors or persons connected with him.

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

	For JAIN PRAMOD JAIN & CO.
	Chartered Accountants)
	Firm Registration No. 016746 N
	(P. K. JAIN)
	Partner
	M. No. 010479
Camp: Kolkata
Date: 21.05.2018

ANNEXURE ''B'' TO THE INDEPENDENT AUDITORS'' REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENT OF STAR PAPER MILLS LIMITED.

Report on the Internal Financial Controls under Clause (i) of sub -section 3 of section 143 of the Companies Act, 2013.

We have audited the internal financial controls over financial reporting of Star Paper Mills Limited, as at March 31, 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

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

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with Guidance note on Audit of Internal Financial Controls over Financial Reporting (the" Guidance Note" ) and the Standard on Auditing, issued by ICAI prescribed under section 143 (10) of the Companies Act 201 3, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those standards and the Guidance Note require that we Comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate Internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

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

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

Meaning of Internal Financial Controls Over Financial Reporting

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

Inherent Limitations of Internal Financial Controls over Financial Reporting

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

Opinion

In our opinion, the Company has in all material respect, an adequate internal financial controls systems over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on "the internal control over financial reporting criteria established by the Company Considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India"

	For JAIN PRAMOD JAIN & CO.
	Chartered Accountants)
	Firm Registration No. 016746 N
	(P.K.JAIN)
	Partner
	Membership No. 010479
Camp: Kolkata
Date: 21.05.2018

---

Mar 31, 2015

1. Report on the Financial Statements

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

2. Managements' 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 Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

3. 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) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditors' 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 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 control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's 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 qualified audit opinion.

4. Basis for Qualified Opinion

Attention is drawn to the Note 23.1 regarding excess remuneration amounting to Rs. 21.57 Lakhs paid to managerial personnel for an earlier year, which is subject to approval of the Central Government.

We further report that impact with respect to the above cannot be ascertained and commented upon by us.

5. Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matter described in of the matter described in the Basis for Qualified Opinion paragraph, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its Profit and its Cash Flows for the year ended on that date.

6. Emphasis of Matter

We draw attention to Note No.26.1 dealing with regard to dispute for levy of Mandi Fee amounting to Rs.230 lacs in respect of goods procured in earlier years against which the company has filed a review petition before Hon'ble High Court at Allahabad. Against the said demand the company has deposited Rs. 230 lacs (included under Long Term Loans and Advances) and the accrual of liability is dependent upon the decision of the Hon'ble High Court at Allahabad. The said amount has been considered as contingent liability. Our conclusion is not qualified in respect of this matter.

7. Report on other Legal and Regulatory Requirements

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

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

d) In our opinion, the Balance Sheet, Statement of Profit and loss and Cash Flow Statement comply with the Accounting Standards specified under section 133 of the Act , read with Rule 7 of the Companies (Accounts) Rules, 2013;

e) On the basis of the written representations received from the directors as on March 31, 2015, 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) 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 effect of pending litigations on its financial positions in its financial statements as required in terms of Accounting Standards and provision of Companies Act, 2013. – Refer Note. 26 to financial statement.

ii. The Company did not have any Long term contracts including Derivative contracts for which there were any material foreseeable losses.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Annexure to the Auditor's Report our Report of even date:

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

(b) All the assets have not been physically verified by the management during the year but there is regular programme of verification, which, in our opinion, is reasonable having regard to the size of Company and the nature of its assets. There were no material discrepancies with regard to book records in respect of the assets verified during the year.

ii. (a) The inventory has been physically verified by the management at regular intervals during the year in our opinion and according to the information and explanation given to us, the frequency of verification is reasonable.

(b) In our opinion, the procedure for the physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. As explained to us, discrepancies noticed on physical verification of inventory were not material.

iii. According to information and explanations given to us the company has not granted any loans, secured or unsecured, to companies, forms or other parties in the register maintained under section 189 of the Companies Act, 2013. Accordingly, clause 3(iii) of the Order is not applicable to the company.

iv. In our opinion there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system.

v. The Company has not accepted any deposits from the public under Sections 73 to 76 or any other relevant provisions of Companies Act, 2013. and rules framed there under.

vi. We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 148 (1) of the Act in respect of the Company product and are of the opinion that prima facie the prescribed records have been made and maintained. However, we have not carried out any detailed examination of such records with a view to determine whether they are accurate or complete.

vii. (a) According to the records of the Company, there were delays in depositing with appropriate authorities undisputed statutory dues including provident fund, Investor Education and protection Fund. Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable to it. According to the information and explanation given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2015 for a period of more than six months from the date they became payable.

(b) According to the record of the Company and according to the information and explanation given to us by the management, the details of disputed statutory dues are as below:

Name of the Status Name of Dues Forum where Dispute is pending

The Uttar Pradesh Value Added Tax Additional Commissioner VAT Act 2008 (Appeals)

The Central Sales Tax Sales Tax High Court Act, 1956

Tribunal

UP Krishi Utpadan Mandi Tax High Court Mandi Adhiniyam 1965

The Central Excise Act Excise Duty Central Excise Service Tax Applicant Tribunal, New Delhi.

Name of the Status Period to which the Amount amount relate (Rs. in Lacs)

The Uttar Pradesh VAT Act 2008 2008-09 to 2011-12 44.17 & 2012-13

The Central Sales Tax Act, 1956 1996-97 4.29

1995-96 406.00

UP Krishi Utpadam Mandi Adhiniyam 1965 1.1.1993- 361.60 31.12.2003

The Central Excise Act 2009-10 30.44 2010-11, 2011-12

c. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company .

viii. The Company has accumulated losses as at the year end which has not exceeded fifty percent of its net worth. The Company has not incurred cash losses during the year covered by our audit and had incurred cash losses in the immediately preceding financial year

ix. Based on our audit procedure and on the information and explanation given by the management, we are of the opinion that during the year the company has not defaulted in repayment of dues to banks. There were no debenture holders during the year and no loan was taken from financial institutions.

x. The Company has not given guarantees for loans taken by others from bank or financial institutions.

xi. As per the information and explanation given to us, the Company has not availed term loan during the year. Accordingly , the provision of clause 3 (xi) of the order are not applicable

xii. Based upon the audit procedures performed and information and explanations given to us, we report that no material fraud on or by the Company has been noticed or reported during the course of our audit.

For Lodha & Co.

Chartered Accountants

Firm ICAI Registration No: 301051E

Place: Kolkata H K Verma

Date: 20th May, 2015 Partner

Membership No. 55104

---

Mar 31, 2014

1. Report on the Financial Statements

We have audited the accompanying financial statements of STAR PAPER MILLS LIMITED ("the Company") which comprise the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

2. Managements'' 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.The 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.

3. 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 judgement, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error in making those risk assessments, the auditor consider internal control relevant to the company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of according policies used and the reasonableness or 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 qualified audit opinion.

4. Basis for Qualified Opinion

Attention is invited to the Note 23.1 regarding excess remuneration amounting to Rs 64.51 Lakhs payable to managerial personnel for earlier years, which is subject to approval of the Central Government.

We further report that impact with respect to the Notes given as above cannot be ascertained and commented by us.

5. Qualified Opinion

In our opinion and to the best of our information and according to the explanation given to us, except for the effects of the matter described on the Basis for Qualified Opinion paragraph, 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 me 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 case of the Cash Flow Statements of the cash flows for the year ended on that date.

6. 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 paragraph 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 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 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 sub-section (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, 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 referred to in paragraph 6 of our report of even date.

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

(b) All the assets have not been physically verified by the management during the year but there is regular programme of verification, which, in our opinion, is reasonable having regard to the size of Company and the nature of its assets. There were no material discrepancies with regard to book records in respect of the assets verified during the year.

(c) During the year, the Company has not dispose off substantial part of its fixed assets.

ii. (a) The inventory has been physically verified by the management at regular intervals during the year in our opinion and according to the information and explanation given to us, the frequency of verification is reasonable.

(b) In our opinion, the procedure for the physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. As explained to us, discrepancies noticed on physical verification of inventory were not material.

iii. (a) According to information and explanations given to us the company has not granted any loans, secured or unsecured, to companies, forms or other parties in the register maintained under section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (iii) (b) and (c) of the Order are not applicable.

(b) As informed to us, the Company has taken unsecured loans from a company covered in the register maintained under section 301 of the Act. The maximum amount of such loans during the year was Rs.421.24 Lakhs and the year-end balance was Rs.421.24 Lakhs.

(c) As explained ,the loan is repayable on demand and in our opinion, the rate of interest and other terms and conditions of such loan are not prima facie prejudicial to the interest of the company.

(d) According to the information and explanations given to us, the company has been regular in repayment of the principal amount and interest thereon as applicable.

iv. In our opinion there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls.

v. According to the information and explanations given to us, during the year there were no contracts or arrangement referred to in Section 301 of the Act which were required to be entered in the register under that section and accordingly Para v(b) of the Order is not applicable.

vi. The Company has not accepted any deposits from the public under Section 58A, 58AA or any other relevant provision of the Act and the rules framed there under.

vii. In our opinion and according to the information and explanation and explanations given to us, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

viii. We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209 (1) (d) of the Act in respect of the Company product and are of the opinion that prima facie the prescribed records have been made and maintained. However, we have not carried out any detailed examination of such records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company, there were delays in depositing with appropriate authorities undisputed statutory dues including provident fund, Investor Education and protection Fund. Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable to it. According to the information and explanation given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2014 for a period of more than six months from the date they became payable.

(b) According to the record of the Company and according to the information and explanation given to us by the management, the details of disputed statutory dues are as below:

Name of the Status Name of Forum where Dispute is the dues pending

The Uttar Pradesh Sales Tax Additional Commissioner Trade Tax Act, 1948 (Appeals)

The Uttar Pradesh Value Added Tax Additional Commissioner VAT Act 2008 (Appeals)

The Central Sales Tax Sales Tax High Court Act, 1956 Tribunal

Additional Commissioner (Appeals)

The Uttar Pradesh Tax Entry Tax Additional Commissioner on Entry of Goods Act (Appeals)

The Uttar Pradesh Entry Tax Supreme Court Trade Tax Act, 1948

UP Krishi Utpadan Mandi Tax High Court Mandi Adhiniyam 1965



Name of the Status Period to which the Amount amount relate (Rs. in Lacs)

The Uttar Pradesh 2004-05 & 2005-06 163.11 Trade Tax Act, 1948

The Uttar Pradesh 2008-09 to 2011-12 65.72 VAT Act 2008 & 2012-13

The Central Sales Tax 1996-97 4.29 Act, 1956 1995-96 406.00

2010-11 2.55 The Uttar Pradesh Tax 2008-09 163.27 on Entry of Goods Act

The Uttar Pradesh 2008-11 38.96 Trade Tax Act, 1948

UP Krishi Utpadan 1.1.1993- 230.00 Mandi Adhiniyam 1965 31.12.2003

x. The Company has accumulated losses as at the year end which has not exceeded fifty percent of its net worth. The Company has incurred cash losses during the year covered by our audit and had incurred cash losses in the immediately preceding financial year

xi. Based on our audit procedure and on the information and explanations given by the management, we are of the opinion that during the year the Company has not defaulted in repayment of dues to banks. There were no debenture-holders there in the year and no loan was taken from financial institutions.

xii. Based on our examination of documents and records and according to information and explanations given to us, we are of the opinion that the Company has not granted loans and 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. Accordingly, the provisions of clause 4 (xiii) of the Order are not applicable to the Company.

xiv. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Order are not applicable to the Company.

xv. The Company has not given guarantees for loans taken by others from bank or financial institutions.

xvi. As per the information and explanation given to us, the Company has not availed term loan during the year. Accordingly, the provisions of clause 4 (xv) of the Order are not applicable.

xvii. According to the information and explanations given to us and on overall examination of the Balance Sheet of the company, we report that short-term funds amounting to Rs.6,533.63 Lakhs have been used for long-term investments, i.e. for acquisition of fixed assets/funding losses to the company, etc.

xviii. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

xix. The Company has not issued any debenture during the period. Accordingly, the provisions of clause 4 (xix) of the Order are not applicable to the Company.

xx. The company has not raised money by public issues during the period.

xxi. Based upon the audit procedures performed and information and explanations given by the management, we report that no material fraud on or by the Company has been noticed or reported during the course of our audit.



For Lodha & Co. Chartered Accountants Firm ICAI Registration No: 301051E

Place: Kolkata H. K Verma Date : 19th May, 2014 Partner Membership No. 55104

---

Mar 31, 2013

1. Report on the Financial Statements

We have audited the accompanying financial statements of STAR PAPERS MILLS 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.

2. 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.

3. 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 Charted 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 judgement, including the assessment of the risk 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.

4. Basis for Qualified Opinion

I. Attention is invited to the following Notes regarding:

(a) non -provision of the diminution in value of investment as stated in note 12(b) and

b) provision of managerial remuneration amounting to Rs. 64.51 lacs which is subject to approval of the Central Government.

(Note 21a)

II. We further report that impact with respect to the Notes given in paragraph I (a) above cannot be ascertained and commented by us.

5. Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, 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 me 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 loss for the year ended on that date; and

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

6. 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 paragraph 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 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 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 accounts;

d. In our opinion, the balance Sheet Statement of profit and loss, and cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; and

e. On the basis of written representations received from the directors as on March 31,2013, taken on record by the Board of Directors, none of the directors is dis-qualified 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

Annexure referred to in paragraph 6 of our report of even date.

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

(b) All the assets have not been physically verified by the management during the year but there is regular programme of verification, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. There were no material discrepancies with regard to book records in respect of the assets verified during the year.

(c) During the year, the Company has not disposed off substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified by the management at regular intervals during the year. In our opinion and according to the information and explanations given to us, the frequency of verification is reasonable.

(b) In our opinion, the procedure for the physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. As explained to us, discrepancies noticed on physical verification of inventory were not material.

(iii) (a) According to information and explanations given to us the company has not granted any loans, secured or unsecured, to companies, firms or other parties in the register maintained under section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (iii) (b) and (c) of the Order are not applicable.

(b) As informed to us, having regards to terms and conditions of the loan as mentioned above, there is no overdue amount outstanding in respect of such loans. However, interest has not been recovered regularly and at the year-end outstanding interest were Rs.7.38 lacs.

(c) As informed to us, the Company has taken unsecured loans from a company covered in the register maintained under section 301 of the Act. The maximum amount of such loans during the year was Rs.416.74 lacs and the year-end balance was Rs.416.74 lacs.

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

(e) According to the information and explanations given to us, the company has been regular in repayment of the principal amount and interest thereon as applicable.

(iv) In our opinion there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls.

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

(b) Based on the audit procedures applied by us and according to the information and explanations given to us, the transactions made pursuance of contracts or arrangements exceeding the value of Rs. 5 lacs in respect of a party has been made at prices which are reasonable having regard to prevailing market prices.

(vi) The Company has not accepted any deposits from the public under Section 58A, 58AA or any other relevant provision of the Act and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209 (1) (d) of the Act in respect of the Company''s product and are of the opinion that prima facie the prescribed records have been made and maintained. However, we have not carried out any detailed examination of such records with a view to determine whether they are accurate or complete.

(ix) (a) According to the records of the Company, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident Fund, Investor Education and protection Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth-tax, Service-tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable to it. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding, as at 31st March 2013 for a period of more than six months from the date they became payable.

(b) According to the records of the Company and according to the information and explanation given to us by the management, the details of disputed statutory dues are as below:

Name of the Status Name of Forum where Dispute is the dues pending

The Uttar Pradesh Sales Tax Trade Tax Tribunal

Trade Tax Act 1948

The Uttar Pradesh Sales Tax Additional Commissioner

Trade Tax Act 1948 (Appeals)

The Uttar Pradesh Entry Tax Additional Commissioner

Trade Tax Act 1948 (Appeals)

The Uttar Pradesh Entry Tax Supreme Court

Trade Tax Act 1948

The Uttar Pradesh Value Added Tax Additional Commissioner

VAT Act, 2008 (Appeals)

UP Krishi Utpadan Mandi Tax High Court

Mandi Adhiniyam 1965

The Central Sales Sales Tax High Court

Tax Act, 1956

The Central Sales Sales Tax High Court

Tax Act, 1956

Name of the Status Period to which the Amount amount relate (Rs. in Lacs)

The Uttar Pradesh 2004-2007 1.32

Trade Tax Act 1948

The Uttar Pradesh 2004-05 to 2005-06 163.11

Trade Tax Act 1948

The Uttar Pradesh 2007-09 22.82

Trade Tax Act 1948

The Uttar Pradesh 2008-2011 38.93

Trade Tax Act 1948

The Uttar Pradesh 2007-11 96.86

VAT Act, 2008 2012-13 2.79

UP Krishi Utpadan 1.1.1993-31.12.2003 176.00

Mandi Adhiniyam 1965

The Centrak Sales 1986-91 69.10

Tax Act, 1956 1996-97 8.59

The Central Sales 1995-96 477.93

Tax ACT, 1956 2005-07 0.90



(x) The Company has accumulated losses as at the year-end which has not exceeded fifty percent of its'' networth. However, the effect of the unquantified qualification has not been taken into consideration for the purpose of making our comments in this clause. The Company has incurred cash losses during the year covered by our audit and had incurred cash losses in the immediately preceding financial year.

(xi) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that during the year the Company has not defaulted in repayment of dues to financial institutions, bank or debenture holders.

(xii) Based on our examination of documents and records and according to information and explanations given to us, we are of the opinion that the Company has not granted loans and advance on the bases 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. Accordingly, the provisions of clause 4 (xiii) of the order are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Order are not applicable to the Company.

(xv) The Company has not given guarantees for loans taken by others from bank or financial institutions.

(xvi) As per the information and explanation given to us, the Company has not availed fresh term loan during the year.

(xvii) According to the information and explanations given to us and on overall examination of the Balance Sheet of the company, we report that short-term funds amounting to Rs. 4707.49 lacs have been used for long-term investments, i.e. for acquisition of fixed assets/funding losses to the company etc.

(xviii)The Company has not made an preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

(xix) The Company has not issued any debenture during the period. Accordingly, the provision of clause 4 (xix) of the Order are not applicable to the Company.

(xx) The Company has not raised money by public issues during the period.

(xxi) Based upon the audit procedures performed and information and explanations given by the management we report that no fraud on or by the Company has been noticed or reported during the course of our audit.



For Lodha & Co.

Chartered Accountants

Firm ICAI Registration No: 301051E



Place: Kolkata H.S.Jha

Date: 24th May, 2013 Partner

Membership No. 55854

---

Mar 31, 2012

We have audited the attached Balance Sheet of Star Paper Mills Limited as at 31st March 2012 and also Statement of Profit and Loss and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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.

I. As required by the Companies (Auditor's Report) Order' 2003 as amended by the Companies (Auditor's Report) (Amendment) Order' 2004 ("the order") issued by the Central Government in exercise of the powers conferred by section 227(4A) of the Companies Act' 1956("the Act") and according to the information and explanations given to us and on the basis of such checks as we considered appropriate' we state that:

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

(b) All the assets have not been physically verified by the management during the year but there is regular programmed of verification' which' in our opinion' is reasonable having regard to the size of the Company and the nature of its assets. There were no material discrepancies with regard to book records in respect of the assets verified during the year.

(c) Duri ng the year' the Company has not disposed off substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified by the management at regular intervals during the year.

In our opinion and according to the information and explanations given to us' the frequency of verification is reasonable.

(b) In our opinion' the procedure for the physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. As explained to us' discrepancies noticed on physical verification of inventory were not material.

(iii) (a) According to information and explanations given to us the company had given unsecured loans to

two companies listed in the register maintained under Section 301 of the Act. The maximum amount involved during the year was Rs.64.96 lacs and the year-end balance of such loans was Rs. Nil

(b) In our opinion' the rate of interest and other terms and conditions on which the unsecured loans as mentioned in (a) above were prima facie not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us' the principal amount and interest in respect of loan granted as mentioned above are repayable on demand. These loans have been fully repaid.

(d) As informed to us' having regards to terms and conditions of the loan as mentioned above' there is no

overdue amount outstanding in respect of such loans. However' interest has not been recovered regularly and at the yearend outstanding interest were Rs.8.20 lacs.

(e) As informed to us' the Company has taken unsecured loans from a company covered in the register maintained under section 301 of the Act. The maximum amount of such loans during the year was Rs.325 lacs and the year-end balance was Rs.321.24 lacs.

(f) In our opinion' the rate of interest and other terms and conditions of such loan are not prima facie prejudicial to the interest of the Company.

(g) According to the information and explanations given to us' the company has been regular in repayment of the principal amount and interest thereon as applicable.

(iv) In our opinion there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory' fixed assets and with regard to the sale of goods and services. During the course of our audit' no major weakness has been noticed in the internal controls.

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

(b) Based on the audit procedures applied by us and according to the information and explanations given to us' the transactions made pursuance of contracts or arrangements' exceeding the value of Rs.5 lacs in respect of a party has been made at prices which are reasonable having regard to prevailing market prices.

(vi) The Company has not accepted any deposits from the public under Section 58A' 58AA or any other relevant provision of the Act and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us' the Company has an internal audit system commensurate with the size of the Company and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209 (1) (d) of the Act in respect of the Company's product and are of the opinion that prima facie the prescribed records have been made and maintained. However' we have not carried out any detailed examination of such records with a view to determine whether they are accurate or complete.

(ix) (a) According to the records of the Company' the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund' Investor Education and Protection Fund' Employees' State Insurance' Income-tax' Sales-tax' Wealth-tax' Service Tax' Custom Duty' Excise Duty' Cess and other statutory dues applicable to it. According to the information and explanations given to us' no undisputed amounts payable in respect of aforesaid dues were outstanding' as at 31st March 2012 for a period of more than six months from the date they became payable.

(b) According to the records of the Company and according to the information and explanation given to us by the management' the details of disputed statutory dues are as below:

Period to which Amount Name of the Name of Forum where dispute the amount relate Rs. in Statue the Dues is pending (Financial Year) Lacs)

The Uttar Pradesh Sales Tax Additional Commissioner 2000-01 0.28 Trade Tax Act' 1948 (Appeals)

-do- 2007-08 141.24

Trade Tax Tribunal 2004-07 1.32

The Uttar Pradesh Entry Tax Additional Commissioner 2007-09 22.82 Trade Tax Act' 1948 (Appeals)

The Uttar Pradesh VAT Additional Commissioner 2007-10 47.78

VAT Act' 2008 (Appeals)

UP Krishi Utpadan Mandi Tax High Court 1.1193- 176.12 Mandi Adhiniyam 31.12.2003 1965

The Central Sales Sales Tax High Court 1986- 91 69.10 Tax Act' 1956 1996- 97 8.59

Additional Commissioner 1995 - 1996 477.93 (Appeals)

Tribunal 2005 - 07 0.90

The Income Tax Act Income Tax Commissioner (Appeals) 2008 - 09 370.99 1956

(x) The Company does not have any accumulated losses. The Company has incurred cash losses during the year covered by our audit and had incurred cash losses in the immediately preceding financial year. The effect of unquantified qualification has not been taken into consideration for the purpose of making comment in respect of this clause.

(xi) Based on our audit procedures and on the information and explanations given by the management' we are of the opinion that during the year the Company has not defaulted in repayment of dues to financial institutions' bank or debenture holders.

(xii) Based on our examination of documents and records and according to information and explanations given to us' we are of the opinion that the Company has not granted loans and advances on the basis of security byway of pledge of shares' debentures and other securities.

(xiii) In our opinion' the Company is not a chit fund oar niche mutual benefit fund / society. Accordingly' the provisions of clause 4 (xiii) of the Order are not applicable to the Company.

(xiv) In our opinion' the Company is not dealing in or trading in shares' securities' debentures and other investments. Accordingly' the provisions of clause 4 (xiv) of the Order are not applicable to the Company.

(xv) The Company has notgiven guarantees for loans taken by others from bankor financial institutions.

(xvi) As per the information and explanation given to us' the Company has not availed fresh term loan during the year.

(xvii) According to the information and explanations given to us and on overall examination of the Balance Sheet of the company' we report that short-term funds amounting to Rs.2'764.73 lacs have been used for long-term investments' i.e. for acquisition of fixed assets/funding losses to the company.

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

(xix) The Company has not issued any debenture during the period. Accordingly' the provisions of clause 4 (xix) of the Order are not applicable to the Company.

(xx) The company has not raised money by public issues during the period.

(xxi) Based upon the audit procedures performed and information and explanations given by the management' we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

II. Attention is invited to the following Notes regarding:

a) non-provision of diminution in value of investment' as stated in Note 13b; and

b) payment of managerial remuneration amounting to Rs. 64.51 lacs which is subject to approval of the Central Government.(Note 22a)

III. We further report that impact with respect to the Notes given in paragraph II above cannot be ascertained and commented by us.

IV. Further to above' we report that:

(i) We have obtained all the information and explanations' which to the best of our knowledge and belief were necessary for the purposes of our audit;

(ii) 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;

(iii) 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;

(iv) In our opinion' the balance sheet' statement of profit and loss and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Act;

(v) On the basis of information available with the company and written representations received from the directors' and taken on record by the Board of Directors' we report that none of the directors is disqualified as on 31st March 2012 from being appointed as directors in terms of section 274(1) (g) of the Act;

(vi) In our opinion and to the best of our information and according to the explanations given to us' the financial statements' subject to our remarks as given in Para II above whereby as given in Para III above' we are unable to ascertain and indicate the impact thereof on these accounts' 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 2012;

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.

For Lodha and Co. Chartered Accountants

Firm ICAI

Registration No: 301051 E H S Jha

Place : Kolkata Partner

Date : 28th May' 2012 Membership Number: 55854

---

Mar 31, 2011

We have audited the attached Balance Sheet of Star Paper Mills Limited as at 31st March 2011 and also the Profit and Loss account and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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.

1, As required by the Companies (Auditor's Report) Order, 2003 as amended by the Companies (Auditor's Report) (Amendment) Order; 200-1- ("the order") issued by the Central Covernmeiil it) exercise of the powers conferred by section 227(4 A) of the Companies Act, 1956("the Act") and according to the information and explanations given to us and on the basis of such checks as we considered appropriate, we state that

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

(b) All the assets have not been physically verified by the management during the year but there is regular programme of verification, which, in our opinion, its reasonable having regard to the size of the Company and the nature of its assets.There were no material discrepancies with regard to book records in respect of the assets verified during the year.

(c) During the year, the Company has not disposed off substantial part of its fixed assets,

(ii) (a) The inventory has been physically verified by the management at regular intervals during the year. In our opinion and according to the information and explanations given to us, the frequency of verification is reasonable.

(b) In our opinion. the procedure for the physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(e) The Company is maintaining proper records of inventory, As explained to us, discrepancies noticedon physical verification of inventory were not material,

(iii) (a) According to information and explanations given to us the company had given unsecured loans to three companies listed in the register maintained under Section 301 of the Act. The maximum amount involved during the year was Rs. 125.96 lacs and the year-end balance of such loans was Rs.64.96lacs.

(b) In our opinion, the rate of interest and other terms and conditions on which the unsecured loans as mentioned in (a) above were prima facie not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us, the principal amount and interest in respect of loan granted as mentioned above are repayable on demand, These loans have not been recalled.

(d) As informed to us.having regards to terms and conditions of the loan as mentioned above, there is no overdue amount outstanding in respect of such loans. However, interest has not been recovered regularly and at the year end outstanding interest were Rs. 79.29 lacs.

(e) An informed to us, the Company has not taken loan, secured or unsecured. from any companies, firms or other parties covered in the Register maintained under Section 301 of the Act. Accordingly, the provisions of clause (iii) (f) and (g) of the order are not applicable to the company.

(iv)In our opinion there are adequate internal control procedures commensurate with the- size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and service . During the course of our audit, no major weakness has been noticed in the internal controls.

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

(b) Based on the audit procedures applied by us and according to the information and explanations given to us. the transactions made pursuance of contracts or arrangements exceeding the value of Rs.5 lacs in respect of a party has been made at prices which are reasonable having regard to prevailing market prices

(vi) The Company has not accepted any deposits from the public under Section 58A, 58 AA or any other relevant provision of the Act and the rules framed there under,

(vii) In our opinion and according to the information and explanations given to us, the Company has an interna] audit system commensurate with the size of the Company and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Act in respect of the Company's product and are of the opinion that prima facie the prescribed records have been made and maintained. However, we have not carried out any detailed examination of such records with a view to determine whether they are accurate or complete.

(ix) (a) According to the records of the Company, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund. Employees' State Insurance, Income-tax, Sales-tax. Wealth-tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable to it. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March 2011 for a period of more than six months from the date they became payable.

(b) According to the records of the Company and according to the information and explanation given to us by the management, the details of disputed statutory dues are as below:

Name of the Statue Nature of the Dues Forum where dispute is pending

The Uttar pradesh Slaes Tax Joint Commissioner Trade Tax Act,1948 (Appeals)

Additional Commissioner (Appeals) Trade Tax Tribunal

The uttar Pradesh Entry Tax Additional Commissioner Trade Tax Act, (Appeals) 1948

The Central Sales Sales Tax High Court Tax Act,1956 Additional Commissioner (Appeals)

The Central Excise Duty Commissioner Excise Act,1944 (Appeals)

Name of the Statue Period to which Amount the amount relate (Rs.in Lacs) (Financial Year)

The Uttar pradesh 2000-01 1.97 Trade Tax Act,1948 2005-2011 144.21

2002-01 0.21

The uttar Pradesh 2007-2009 237.50 Trade Tax Act, 1948

The Central Sales 1996-97 4.29 Tax Act,1956 1995-1996 406.00 and 2005-07

The Central May 2009 7.22 Excise Act,1944 to June 2009

(x) The Company does not have any accumulated losses. The Company has incurred cash losses during the year covered by our audit but had not incurred cash losses in the immediately preceding financial year. The effect of unquatified qualification has not been taken into consideration for the purpose of making comment in respect of this clause.

(xi) Based on our audit procedures and on the information and explanations given by the management we are of the opinion that during the year the Company has not defaulted in repayment of dues to financial institutions, bank or debenture holders.

(xii) Based on our examination of documents and records and according to information and explanations given to us, we are of the opinion that the Company has not granted loans and 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. Accordingly, the provisions of clause 4 (xiii) of the Order are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause4(xiv) of the Order are not applicable to the Company.

(xv) The Company has not given guarantees for loans taken by others from bank or financial institutions,

(xvi) As per the information and explanation given to us, the Company has not availed fresh term loan during the year.

(xvii) According to the information and explanations given to us and on overall examination of the Balance Sheet of the company, we report that sbort-term funds amounting to Rs. 1,358.79 lacs have been used For long-term investments, i.e. for acquisition of fixed assets.

(xviii) The Company has not made any preferential alloltment of shares to parties and companies covered in the register maintained under Section 301 of the Act.

(xix) The Company has created security in respect of debentures issued.

(xxi) Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of ouraudit.

IT. Attention is invited to the Following Notes as given in Schedule 16 regarding:

a) non-provision and non-ascertainment of diminution in value of investment, the impact of which is presently non-ascertainable ( Note 5); and

b) payment of managerial remuneration amounting to Rs.62.34 lacs which is subject to approval of the Central Crovernment,(Note 11 (c))

III. We further report that overall impact with respect to the Notes given in paragraph 11 above cannot be ascertained and commented by us.

IV. Further to above, we report that:

(i) We have obtained all the information and explanations,which to the best of our knowledge and belief were necessary for the purposes of our audit:

(ii) 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;

(iii) The balance sheet, 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, pmfit and loss account and cash Flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 274 of the Act;

(v) On the basis of information available with the company and written representations received from the directors, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on31st March 2011 from being appointed as directors in terms of section 274(1) (g) of the Act;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the financial statements, subject lu our remarks as given in Para II above whereby as given in Para 111 above, we are unable to ascertain and indicate the impact thereof on these accounts, give a true and fair view in conformity with the aecounting principles generally accepted in India:

a) in the case of the balance sheet, of the state of affairs of the Company as 31st March 2011:

b) in the cose of the profit and loss account, of the loss for the year ended on that date: and

c) in the case of the cash flows, statement, of the cash flow for the year ended on that date

For Lodha and Co.,

Chartered Accountants Firm ICAI Register No: 301051E

H S jha

Partner Membership Number: 558854 Place : Kolkata Date :30th May, 2011

---

Mar 31, 2010

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

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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

I. As required by the Companies (Auditors Report) Order, 2003 as amended by the Companies (Auditors Report) (Amendment) Order, 2004 ("the Order") issued by the Central Government in exercise of the powers conferred by section 227(4A) of the Companies Act, 1956 ("the Act") and according to the information and explanations given to us and on the basis of such checks as we considered appropriate, we state that:

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

(b) All the assets have not been physically verified by the management during the year but there is regular programme of verification, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. There were no material discrepancies with regard to book records in respect of the assets verified during the year.

(c) During the year, the Company has not disposed off substantial part of its fixed assets.

(ii) (a) The inventory has been physically verified by the management at regular intervals during the year. In our opinion and according to the information and explanations given to us, the frequency of verification is reasonable.

(b) In our opinion, the procedure for the physical verification of the inventory followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. As explained to us, discrepancies noticed on physical verification of inventory were not material.

(iii) (a) According to information and explanations given to us the company had given unsecured loans to a company listed in the register maintained under Section 301 of the Act. The maximum amount involved duringthe year was Rs. 110.46 lakhs and the year-end balance of such loans was Rs.75.96 lakhs.

(b) In respect of loans given by the company, loan of Rs. 11 lacs given to subsidiary company, which has merged with another company with effect from 1 st April 2008 as given in Note 5 of Schedule 17 is interest free and in other cases the rate of interest and other terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(c) According to the information and explanations given to us, the principal amount and interest in respect of loan granted as mentioned above are repayable on demand. These loans have not been recalled.

(d) As informed to us, having regards to terms and conditions of the loan as mentioned above, there is no overdue amount outstanding in respect of such loans. However, interest has not been recovered regularly and at the year end outstanding interest were Rs.80.62 lakhs.

(e) As informed to us, the Company has not taken loan, secured or unsecured, from any companies, firms or other parties covered in the Register maintained under Section 301 of the Act. Accordingly, the provisions of clause (iii) (f) and (g) of the Order are not applicable to the Company.

(iv) In our opinion there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal controls.

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

(b) Based on the audit procedures applied by us and according to the information and explanations given

to us, the transactions made pursuance of contracts or arrangements exceeding the value of Rs.5 lakhs in respect of a party has been made at prices which are reasonable and having regard to prevailing market prices.

(vi) The Company has not accepted any deposits from the public under Section 58A, 58AA or any other relevant provision of the Act and the rules framed there under.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209 (I) (d) of the Act in respect of the Companys product and are of the opinion that prima facie the prescribed records have been made and maintained. However, we have not carried out any detailed examination of such records with a view to determine whether they are accurate or complete.

(ix) (a) According to the records of the Company, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales-Tax, Wealth-Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable to it. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding, as at 31 st March 2010 for a period of more than six months from the date they became payable.

(b) According to the records of the Company and according to the information and explanation given to us by the management, the details of disputed statutory dues are as below:

Name of the Nature of Forum where dispute Statute The Dues is pending

The Uttar Pradesh SalesTax High Court Trade Tax Act, 1948 Joint Commissioner (Appeals) Additional Commissioner (Appeals) Trade Tax Tribunal

The Uttar Entry Tax Joint Commissioner PradeshTrade Tax (Appeals) Act, 1948 Additional Commissioner (Appeals) Trade Tax Tribunal

The Central Sales Sales Tax High Court Additional Commissioner (Appeals)

Name of the Period to which Amount Statute the amount relate (Rs. in Lakhs) (Financial Year)

The Uttar Pradesh 1979-80 0.28 Trade Tax Act, 1948 2000-01 and 2004-05 2.18 2005-2007 1.11 2002-04 and 2007-2010 168.66

The Uttar 2004-05 2.01 PradeshTrade Tax 2005-2007 11.90 Act, 1948 2007-09 94.67

The Central Sales 1996-97 8.59 Tax Act, 1956 2005-07 4.83

(x) The Company does not have any accumulated losses. The Company has not incurred any cash losses during the year covered by our audit and the immediately preceding financial period.

(xi) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that during the year the Company has not defaulted in repayment of dues to financial institutions, bank or debenture holders.

(xii) Based on our examination of documents and records and according to information and explanations given to us, we are of the opinion that the Company has not granted loans and 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. Accordingly, the provisions of clause 3 (xiii) of the Order are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 3 (xiv) of the Order are not applicable to the Company.

(xv) The Company has not given guarantees for loans taken by others from bank or financial institutions.

(xvi) As per the information and explanation given to us, the Company has not availed fresh term loan during the period.

(xvii) According to the information and explanations given to us and on overall examination of the Balance Sheet of the company, we report that short-term funds amounting to Rs.592.68 lakhs have been used for long-term investments, i.e. for acquisition of fixed assets.

(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act.

(xix) The Company has created security in respect of debentures issued.

(xx) The company has not raised money by public issues duringthe period.

(xxi) Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

II Attention is invited to Note 12 (b) of Schedule 17 regarding payment of managerial remuneration amounting to Rs. 97.56 lakhs which is subject to approval of the Central Government, the impact of which cannot be ascertained on the accounts.

III Further to above, we report that:

(i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessaryforthe purposes of our audit;

(ii) 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;

(iii) The balance sheet, 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, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Act;

(v) On the basis of information available with the Company and written representations received from the directors, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 st March 2010 from being appointed as directors in terms of section 274( I) (g) of the Act;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the financial statements, subject to Para II above the impact of which cannot be ascertained on the accounts 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 31 st March 2010;

b) in the case of the profit and loss account, 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.

For Lodha and Co.,

Chartered Accountants

Firm ICAI Registration No: 301051E

H. S.Jha Place: Kolkata Partner Date: 28th May 2010 Membership Number: 55854