Castex Technologies Ltd Auditors Report.

To the Members of

Castex Technologies Limited,

Report on the Standalone IND AS Financial Statements

We have audited the accompanying standalone IND AS financial statements of Castex Technologies Limited (the Company), which comprise the balance sheet as at 31st March 2018,the statement of profit and loss[including other comprehensive income], the statement of cash flows and the statement of changes in equity for the year then ended, and a summary of the significant accounting policies and other explanatory information(hereinafter referred to as "standalone Ind AS financial statements")

Managements Responsibility for the standalone IND AS Financial Statements

The management and companys board of directors is responsible for the matters specified in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone IND AS financial statements that give a true and fair view of the financial position, financial performance [including other comprehensive income], cash flows and changes in equity of the company in accordance with the accounting principles generally accepted in India, including the Indian accounting standards [Ind AS] prescribed under section 133 of the Act, read with companies (Indian Accounting Standards) rules 2015.

This responsibility also includes the 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 the 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 control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone 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 standalone IND AS financial statements based on our audit.

In conducting our audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunderand the Order issued under section 143(11) of the Act.

We conducted our audit of the standalone 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 standalone Ins AS financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone IND AS financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the standalone IND AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the companys preparation of the standalone 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 companys management and directors, as well as evaluating the overall presentation of the standalone 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 standalone IND AS financial statements.

Our Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 of the company as at March 31, 2018 and itsProfit and loss account for the year ended March 31, 2018 ,total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Emphasis of Matter

Notwithstanding anything contained in the standalone Ind AS financial statements of Castex Technologies Limitedas on 31.03.2018, affects the true & fair opinion over the same, but following is a list of matters, considered significant for the users of the standalone Ind AS financial statements, adequately disclosed by the management:

A corporate insolvency resolution process ("CIRP") has been initiated against Castex Technologies Limited (the Company) vide an order of Chandigarh bench of the National Company Law Tribunal (NCLT) dated December 20, 2017 under the provisions of the insolvency and bankruptcy code 2016 (Code). Pursuant to the order, the power of the Board of directors stands suspended and are exercisable by MrDinkar T. Venkatasubramanian, who was appointed as interim resolution professional (IRP) by the NCLT vide order dated December 20, 2017 and was consequently confirmed as Resolution Professional (RP) by the Committee of Creditors (CoC) in its meeting held on January 12, 2018. Accordingly Mr. Dinkar T. Venkatasubramanian took control of management and operations of the company. As the powers of the Board of Directors had been suspended, the above results have not been adopted by Board of Directors.However, These Standalone Ind AS financial statements have been signed by Sanjay Arora (Whole Time Director) and taken on record by the RP..

1. The company has been continuously making losses, consequently its net worth is negative and thecompanys total liabilities exceeded its total assets. This indicates the existence of materialuncertainty that may cast significant doubt on the companys ability to continue as a going concern. However, in view of the Corporate Insolvency Resolution Process in respect of the company, which is in progress, the accounts have been prepared on a going concern basis (Refer Note [2.1 ] to Financial Statements).

2. Considering the current operating level of the company , and the ongoing CIRP it is not possible to determine:

a. Impairment if any , in the economic value of fixed assets, capital work in progress and tools & die;

b. Diminution, if any, in the value of investment. (Refer Note [2.8,2.13,2.14 ] to Financial Statements)

3. In respect of various claims submitted by the financial, operational & other creditors of the Company to the RP pursuant to Insolvency and Bankruptcy Code, 2016, that are currently under consideration / verification/ reconciliation. Pending finalization of resolution plan, we are unable to comment on the consequential impact, if any, on the accompanying statement [Refer Note [2.1 ] to financial Statements]

4. Trade receivables, loans & advances and other recoverable at March 31, 2018, which also includes balances from the group entities, are subject to confirmation/reconciliation and recoverability assessment thereof is under process. (Refer Note [2.11 ] to Financial Statements)

5. In terms of sections 25(2)(c) and 28(1)(a) of IBC 2016, the CoC has approved the raising of interim finance in its meeting held on 12th March, 2018, Accordingly, the Company has entered into an agreement with ECL Finance Limited, a Mumbai based subsidiary Company of Edelweiss Financial Services Limited and availed interim finance facility up to INR 30,00,00,000 (Rupees Thirty Crores) under the Facility Agreement dated 11, April, 2018, (Refer Note 2.12 in significant accounting policies)

6. The financial statements for the year ended 31 March 2017 was carried out and reported by Manoj Mohan & Associates. whose report has been furnished to us by the management and which has been relied upon by us for the purpose of our audit.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order, 2016 ("the Order") issued by the Central Government of India in exercise of powers conferred by sub section (11) of section 143 of the act, we give in annexure A, a statement on the matters specified in paragraph 3 & 4 of the Order, to the extent applicable.

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 cash flow statement and the statement of changes in equity dealt with by this report are inagreement with the relevant books of account;

(d) In our opinion, the aforesaid standalone IND AS financial statements comply with the Indian Accounting Standards specified under section 133 of the Act, read with the relevant rules there under;

(e) On the basisof the written representations received fromthe directors as on 31stMarch 2018 and taken on record by theboard of directors, none of the directors is disqualified as onMarch 31, 2018, from being appointed as a director in termsof Section 164 (2) of the Act; and

(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". Our report expresses an unmodified opinion on the adequacy and the operating effectiveness of the companys internal financial controls over financial reporting; and

(g) With respect to the other matters to be included in the Auditors Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules, 2014 as amended, according to the explanations and information given to us:

i. The company has disclosed the impact of pending litigations on its financial position in its standalone IND AS financial statements [Refer Note no. 3.27.5].

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 andProtection Fund by the company.

For Raj Gupta & Co

Chartered Accountants

Firms registration number: 000203N

Gunjandeep Singh

[Partner]

Membership Number: 529555

Place : New Delhi

Dated : JUNE 5, 2018

Annexure - A to the Independent Auditors Report

The Annexure referred to in Independent Auditors Report to the members of the Company on the standalone IND AS financial statements for the year ended 31st March 2018.

I. In respect of fixed assets:

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

b. As explained to us, fixed assets, according to the practice of the company, have been physically verified by the management at reasonable intervals. , the frequency of physical verification of fixed assets is reasonable having regard to the size of the Company and nature of its assets. According to the information and explanation given to us , no material discrepancies were noticed on such physical verification.

c. According to the information and explanations given to us and on the basis of our examination of the records of the company, the title deeds of immovable properties are held in the name of the company. However, none is made available to us as they are pledged with the financial institutions.

II. In respect of inventories: We have been informed that the inventories are physically verified during the period by the Company at reasonable intervals. The frequency of physical verification, in our opinion, is reasonable having regard to the size of the company and nature of its business. The discrepancies noticed on verification between the physical inventories and the book records were not material in relation to the operation of the company and the same have been properly dealt with in the books of account.

III. The company, during the year,has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013 (Rs.the Act).Accordingly, paragraph 3(iii) of the Order is not applicable to the company.

IV. In our opinion and according to the information and explanations given to us, the company has complied during the year with the provisions of section 185 and 186 of the Act, with respect to the loans, investments, guarantees and security.

V. Since the company has not accepted any deposit from public, the directives issued by the Reserve Bank of India and the provisions of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under with regard to the deposits accepted from the public are not applicable.

VI. The Central Government has prescribed the maintenance of cost records under section (1) of section 148 of the Companies Act, and on the basis of recordsproduced before us for our verification; we are of the opinion that, prima facie, the prescribed accounts and cost records have been maintained. However, we are neither required to carry out nor have carried out any detailed examination of such accounts & records.

VII. (a) According to the information and explanations given to us and on the basis of our examination of the records of the company, the company has not beenregularin depositing undisputed statutory dues including provident fund, employees state insurance, income-tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess, Goods and Services Tax and other statutory dues with appropriate authorities during the year ended 31st March 2018. The outstanding dues as on the date of the balance sheet i.e. March31, 2018 were Rs.2931.14 Lakhs. According to information and explanation given to us, arrears of undisputed statutory dues outstanding for a period of more than 6 months as on March 31,2018 were Rs. 1512.19 Lakhs.

(b) According to the information and explanation given to us, and as per our verification of records of the company, the company has not paid/deposited following statutory dues on account of disputes:

S.No. Name of Statute Period to which it pertains Forum where dispute is pending Amount (Rs. In Lakh)
1 Excise/Service Tax 2008 to 2014 Commissioner Central Excise (Appeals) 98.21
2 Income Tax 2006 to 2016 Income Tax Appellate Tribunals 1688.53
3 Sale Tax 2015-16 Appeals under process 2.55
Total 1789.29

VIII. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to information and explanations given by the management, A corporate insolvency resolution process ("CIRP") has been initiated against the company vide an order of Chandigarh bench of the National Company Law Tribunal (NCLT) dated December20, 2017 under the provisions of the insolvency and bankruptcy code 2016 (Code). Pursuant to the order, the power of the Board of directors stands suspended and are exercisable by Mr Dinkar T. Venkatasubramanian, who was appointed as interim resolution professional (IRP) by the NCLT vide order dated December22, 2017 and was consequently confirmed as Resolution Professional (RP) by the Committee of Creditors (CoC) in its meeting held on January12, 2018.

IX. According to the information and explanations given to us, and as per our verification of the records of the company, the company, during the year, has not raised moneys by way of initial public offer or further public offer(Including debt instruments). The term loans availed by the company have been applied for the purpose for which the loans were obtained.

X. According to the information and explanations given to us, no fraud by the company or on the company by its officers or employees has been noticed or reported during the Year ended 31st March 2018.

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

XII. In our opinion, and according to the information and explanations given to us, the company is not a Nidhi company. Therefore, the provisions of Clause 3 (xii) of the Order are not applicable to the company.

XIII. According to the information and explanations given to us and as per our verification of the records of the company all transactions with the related parties are in compliance with the Sections 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in theIND ASfinancial statements as required by the applicable accounting standards.

XIV. According to the information and explanations given to us and as per our verification of the records of the company, the company has not made any preferential allotment of shares.

XV. According to the information and explanations given to us, and as per our verification of the records of the company, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of Clause 3 (xv) of the order are not applicable to the company.

XVI. In our opinion, the company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3 (xvi) of the order are not applicable to the company.

For Raj Gupta & Co

Chartered Accountants

Firms registration number: 000203N

Gunjandeep Singh

[Partner]

Membership Number: 529555

Place : New Delhi

Dated : JUNE 5, 2018

Annexure – B to the Independent Auditors Report

Report on the Internal Financial Controls over financial reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act") of Castex Technologies Limited

We have audited the internal financial controls over financial reporting of Castex Technologies Limited ("the Company") as of 31st March 2018 in conjunction with our audit of the standalone IND AS financial statements of the company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

The management and companys board of directorsare responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India ("the Guidance Note"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companys 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 companys internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, 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 an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the standalone IND AS financial statements, whether due to fraud or error. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the companys internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

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

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial 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

A corporate insolvency resolution process ("CIRP") has been initiated against Castex Technologies Limited (the Company) vide an order of Chandigarh bench of the National Company Law Tribunal (NCLT) dated December 20, 2017 under the provisions of the insolvency and bankruptcy code 2016 (Code). Pursuant to the order, the power of the Board of directors stands suspended and are exercisable by Mr Dinkar T. Venkatasubramanian, who was appointed as interim resolution professional (IRP) by the NCLT vide order dated December 20, 2017 and was consequently confirmed as Resolution Professional (RP) by the Committee of Creditors (CoC) in its meeting held on January 12, 2018. The power of the Board of Directors have been suspended and assigned to Resolution Professional.

In our opinion to the best of our information and according to the explanations given to us, the company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31stMarch 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 Raj Gupta & Co

Chartered Accountants

Firms registration number: 000203N

Gunjandeep Singh

[Partner]

Membership Number: 529555

Place : New Delhi

Dated : JUNE 5, 2018