Centerac Technologies Ltd Directors Report.

To the Members of Centerac Technologies Limited Report on the Ind AS Financial Statements

Wc have audited the accompanying Ind AS Financial Statements of CENTERAC TECHNOLOGIES LIMITED ("the Company), which comprise of the Balance Sheet as at March 31, 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 significant accounting policies and other explanatory information ("the Ind AS Financial Statements").

Managements Responsibility for the Ind AS Financial Statements

The Companys 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 financial position, financial performance (including other comprehensive income), statement of changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Indian Accounting Standards specified under Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the 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 Indian Accounting Standards and Auditing Standards and matters which arc required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of the Ind AS Financial Statements in accordance with the Standards on Auditing, as 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 hid AS Financial Statements. The procedures selected depend on the auditors judgement, 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 Companys 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 Companys Directors, as well as evaluating the overall presentation of the Ind AS Financial Statements.

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

Basts for Qualified Opinion

a) Section 164(2)(a) provides that a person who was a director of a company which has failed to file financial statements or annual returns for a continuous period of three financial years shall not be eligible to be re-appointed as a director of that company or appointed in any other company for a period of five years from the date on which the said company fails to do so. Further, Section 167(1 )(a) provides for vacation of office of the director as soon as he incurs any of the disqualifications specified under Section 164.

As a company in which two directors (including the Managing Director) of the Company were directors as at the year-end, had failed to file its annual returns and financial statements with the Registrar of Companies ("ROC") for a continuous period of three financial years, such two directors were disqualified to be appointed/re- appointed as a director. Due to such disqualification, they should have vacated the office as required by Section 167(2), which they have failed to adhere.

Further, for the Financial Year 2017-18, the said two directors (who are so disqualified) were managing day-to-day affairs of the Company and were also authorised signatories to operate bank accounts and sign the required documents, etc. for and on behalf of the Company.

However, we have been informed that the said defaulting company has subsequently completed filings of annual returns with ROC.

We have also been informed that since the date of the Balance Sheet, the said directors have vacated the office and three new directors are appointed in the Board Meeting held on May 23, 2018.

b) Without prejudice to

(a) above -

Section 196(2) of Companies Act, 2013 ("the Act"), inter-alia, provides that a company cannot appoint or re-appoint any person as its Managing Director, Whole Time Director or Manager for a term exceeding five years at a time. Further, Section 196(4) of the Companies Act, 2013 provides that subject to the provisions of section 197 and Schedule V, a Managing Director, Whole-time Director or Manager is to be appointed and the terms and conditions of such appointment and remuneration payable be approved by the Board of Directors at a meeting which shall be subject to approval by a resolution at the next General Meeting of the Company.

Though the term of appointment of the Managing Director of the Company expired in 2015, the Company did not consider appointment/re-appointment of Managing Director, as required by Section 196 of the Act till the date of the Annual General Meeting ("AGM"), i.e. September 21, 2017. However, Managerial Remuneration amounting to Rs.3 lakhs for the quarter ended June 30, 2017 and sum of Rs.2 lakhs was provided for the months of July and August 2017, for which the approval of shareholders was obtained only at the AGM held on September 21, 2017. Out of the said amount, Rs.2.16 lakhs was paid till the date of AGM. Thus, the remuneration to the extent paid/payable to the Managing Director was not in compliance with the provisions of the Act.

c) In terms of Section 185 of the Companies Act, 2013 ("the Act"), a company cannot advance any loan to its directors. During the half year ended September 30, 2017,. the Company advanced interest-free loan of Rs.6.57 Lakhs to its director which is not in compliance with the provisions of Section 185 as also Section 186(7) of the Act. However, subsequently, the loan has been repaid and no amount is outstanding as on March 31, 2018.

Qualified 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 Results of the Company:

a. are presented in accordance with the requirements of Regulation 33 of the SEBI (Listing Obligation and Disclosure Requirements Regulations, 2015), as modified by SEBI Circular No. CIR/CFD/FAC/62/2016 dated July 5, 2016; and

b. give a true and fair view in conformity with the aforesaid Ind AS and other accounting principles generally accepted in India, of the net loss, total comprehensive loss and other financial information of the Company for the year ended March 31, 2018.

Other Matter

Section 149 (1) (a) of the Act requires a public company to have a minimum of three directors. As two of its directors are disqualified under Section 164 (2), the Company would said to have not complied with the aforesaid statutory requirement. However, in the Board Meeting held on May 23, 2018, the Company has complied with the aforesaid requirement by appointing three new directors.

Our opinion is not qualified in respect of this matter.

The Comparative financial information of the Company for the year ended March 31, 2017and the transition date opening Balance Sheet as at April 1, 2016 included in these Ind AS Financial Statements, are based on the previously issued financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 and other accounting principles generally accepted in India and audited by us (vide their modified audit report on May 24, 2017and unmodified audit report on May 30, 2016 respectively), as adjusted for the differences in the accounting principles adopted by the Company on transition to Ind AS, which have been audited by us.

Our opinion above on the Ind AS Financial Statements, and our report on Other Legal and Regulatory Requirements below, is not modified in respect of the above matter.

Report on Other Legal and Regulatory Requirements

1. 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 hooks 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 Cash Flows 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 Ind AS specified under Section 133 of the Act, read with relevant rules issued thereunder;

e. According to the information and explanations given to us and on the basis of our examination of the records of the Company, one of the companies in which two of the directors of the Company were directors failed to file its annual returns and financial statements with the Registrar of Companies ("ROC") for a continuous period of three financial years and accordingly, in our opinion, the said two directors of the Company were disqualified from being appointed as directors under Section 164(2). Further, on the basis of written representations received from the remaining two directors as on March 31, 2018 taken on record by the Board of Directors, the remaining two directors are not disqualified as on March 31,2018;

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

g. With respect to the other matters to be included in the Auditors 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, if any, of pending litigations on its financial position in its financial statements of the Financial Statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as required under the applicable law or accounting standards;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year ended March 31,2018.

2. As required by the Companies (Auditors Report) Order, 2016 ("the Order"), issued by the Central Government of India in terms of Section 143(11) of the Act, we enclosed in "Annexure B", a statement on the matters specified in the paragraphs 3 and 4 of the Order.

ANNEXURE A TO THE INDEPENDENT AUDITORS REPORT

Referred to in paragraph (l) under the heading of "Report on Other Legal and Regulatory Requirements" of our Independent Auditors Report of even date to the members on the Ind AS Financial Statements for the year ended March 31, 2018.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act") We have audited the interna! financial controls with reference to financial statements of CENTERAC TECHNOLOGIES LIMITED ("the Company"), as of March 31, 2018 in conjunction with our audit of the Ind AS Financial Statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

The Companys management is responsible for establishing and maintaining internal financial controls based on the internal control with reference to financial statements 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 (the "Guidance Note") issued by the Institute of Chartered Accountants of India ("ICAI"). 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 Act.

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with 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. 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 with reference to financial statements 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 with reference to financials statements and their operating effectiveness. Our audit of Internal Financial Controls with reference to financial statements included obtaining an understanding of Internal Financial Controls with reference to financial statements, 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 judgement, including the assessment of the risks of material misstatement of the 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 with reference to financial statements.

Meaning of Internal Financial Controls Over Financial Reporting

A companys internal financial control with reference to financial statements 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 with reference to financial statements 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 expenditure 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 companys assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to financial statements

Because of the inherent limitations of internal financial controls with reference to financial statements, 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 with reference to financial statements to future periods are subject to the risk that the internal financial control with reference to financial statements 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 ail material respects, an adequate internal financial controls system with reference to financial statements and such internal financial controls with reference to financial statements were operating effectively as at March 31, 2018, based on the internal control with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note.

ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT

Referred to in paragraph 2 under the heading of "Report on Other Legal and Regulatory Requirements" of our Independent Auditors Report of even date on the Ind AS Financial Statements for the year ended March 31, 2018 Report on the Companies (Auditors Report) Order, 2016, issued in terms of Section 143(11) of the Companies Act, 2013("the Act") of CENTERAC TECHNOLOGIES LIMITED ("the Company")

i. a. The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment (PPE).

b. The PPE of the Company are physically verified by the management according to a phased programme designed to cover all the PPE twice during the year, which in our opinion, is at reasonable intervals having regard to the size of the Company and the nature of its assets. As informed to us, no material discrepancies were noticed on such verification.

c. According to the information and explanations given to us and on the basis of our examination of the records of the Company, for an immovable property as included in Note 3 on ‘Property, plant and equipment and Others to the financial statements, though the agreement to purchase the same was entered into and was in the name of the Company (in erstwhile name of the Company), the said agreement has not yet been registered in the name of the Company with the appropriate authority; the said immovable property was transferred on January 31, 2018 as a result of which there is no balance as on the Balance Sheet Date.

ii. The Company did not carry out any manufacturing and trading activity, and did not hold any inventory at any time during the year. Accordingly, paragraph 3(ii) of the Order is not applicable.

iii. The Company has not granted any loans, secured or unsecured, to companies, firms, limited liabilities partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, paragraph 3(iii) of the Order is not applicable.

iv. In our opinion and according to the information and explanations given to us, the Company has advanced loan to its Managing Director which is not in compliance with the provisions of Section 1 85 of the Act. In respect of the said loan to the Managing Director, the maximum amount outstanding during the year is Rs. 14,27,500 and the amount outstanding as at March 31, 2018 is NIL.

Further, the Company has not complied with the provisions of Section 186 of the Act in respect of a loan given, though the Company is in compliance with Section 186 with respect to investments made. The details of non-compliance under Section 186 of the Act are as under:

Nature of non-compliance Name of Party Amount

involved

Rs

Balance as at Balance Sheet Rs Remarks, if any
Interest-free loan given and hence it is below the prescribed rate of interest under Section 186 (7) of the Act Mr.Sanjiv Khandelwal (Managing Director) 14,27,500 NIL The loan is interest-free loan

The Company has not granted any other loan or given guarantee or provided security in connection with a loan to any person or other body corporate requiring compliance with the provisions of Sections 1 85 and 186 of the Act.

v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposit from the public. Accordingly, paragraph 3 (v) of the Order to comment on whether the Company has complied with the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and rules framed thereunder, is not applicable,

vi. As the Company is not engaged in manufacturing activities, the question of maintaining cost records, pursuant to the Companies (Cost Records and Audit) Rules, 2014 as specified by the Central Government under Section 148 (1) of the Act does not arise, and accordingly, paragraph 3(vi) of the Order is not applicable.

vii. a. According to the information and explanations given to us and on the basis of thebooks and records examined by us, the Company has been regular in depositing undisputed statutory dues including Provident Fund, Income-tax, Goods and Services Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and other statutory dues as applicable to it with the appropriate authorities, except in few cases there were delays in payment of service tax, excise duty, customs duty and tax deduction at source. Flowever, there are no arrears of outstanding statutory dues on the last day of the financial year, for a period of more than six months from the date they become payable. As informed to us, the provisions of the Employees State Insurance Act are not applicable to the Company.

b. According to the information and explanations given to us and on the basis of the books and records examined by us, there arc no dues outstanding in respect of Income-tax, Sales-tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax and Cess as on March 31, 2018, as applicable to it, which have not been deposited on account of any dispute.

viii. The Company does not have any loan or borrowing from any financial institution, bank, government or dues to debenture holders. Accordingly, paragraph 3(viii) of the Order is not applicable.

ix. According to the information and explanations given to us and on the basis of the books and records examined by us, the Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. Accordingly, paragraph 3 (ix) of the Order in respect thereof is not applicable.

x. According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year in the course of our audit.

xi. According to the information and explanations give to us and based on our examination of the records of the Company, subject to the fact that appointment /reappointment of the Managing Director was not done after its earlier term expired and also the remuneration of Rs. 5 lakhs was provided (and of which Rs. 2.16 lakhs was paid) during the year for which approval of the Shareholders was obtained only at the Annual General Meeting ("AGM"), held on September 21, 2017, the Company has paid/provided for managerial remuneration in accordance with the limits prescribed under Section 197 read with the limits prescribed under Section 197 read with Schedule V to the Act.

xii. The Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable to the Company.

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

xiv. According to the information and explanations given to us and on the basis of the books and records examined by us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, reporting under paragraph 3(xiv) of the Order is not applicable,

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

xvl. The Company is not required to be registered under Section 45-1A of the Reserve Bank of India Act, 1934. Accordingly, paragraph 3(xvi) of the Order is not applicable to the Company.