RCL Retail Ltd Auditors Report.

TO,

THE MEMBERS OF,

RCL RETAIL LIMTIED.

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of RCL RETAIL LIMITED ("the Company"), which comprises of the Balance Sheet as at 31st March 2017, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other Explanatory Information.

MANAGEMENTS RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

The Companys Board of Directors is responsible for the matters in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision 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 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 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 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 thereunder.

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 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 financial control relevant to the Companys preparation of the financial statements that give true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Companys Directors, as well as evaluating the overall presentation of the financial statements.

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

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the 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:

a) In the case of the Balance Sheet, of the State of affairs of the Company as at 31st March 2017;

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

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

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditors Report) Order, 2016 (‘the Order), as amended, issued by 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 said Order.

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

(1) 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;

(2) 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;

(3) 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;

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

(5) On the basis of written representation received from the directors, as on 31st March 2017 and taken on record by the Board of Directors, none of the directors is disqualified as at 31st March 2017 from being appointed as a director in terms of Section 164(2) of the Act;

(6) 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 the Annexure"B" to this report.

(7) With respect to the other matters to be included in the Auditors Report in accordance to Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to our best of our information and according to the explanations given to us :

i. The Company has disclosed the impact of pending litigation in its 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 is no requirement for transferring funds to the Investor Education and Protection Fund.

iv. The Company has provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8 November, 2016 to 30 December, 2016 and these are in accordance with the books of accounts maintained by the Company.

Date: 22.06.2017. For SIDHARTH MEHTA & CO.,
Place: Chennai Chartered Accountants
(SIDDHARRTH MEHTA)
Proprietor
Member ship No. 207043
Firm Reg. No. 008108S.

ANNEXURE "A" Refer to in paragraph 1 of the our report of even date

To the member of RCL Retail Limited on the Accounts Of Company For The Year ended 31st,March, 2017.

On the basis of such checks as we considered and according to the information and explanation given to as during the course of our audit we report that:

1. The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The Fixed Assets have been physically verified by the management at the end of the year and no material discrepancies have been noticed on such verification. For there it is observed that the immovable property is held in the name of company.

2. The Stock of Traded Goods has been physically verified by management at the close of the year.

As per the information given to us the procedure of physical verification of traded stock followed by the management is in our opinion reasonable and adequate in relation to the size of company and nature of its business.

On the basis of examination of stock record it is found that the same have been properly maintained and the discrepancies if any notice on physical verification have not been material as compared to the book record.

3. In our opinion and according to the information and explanations given to us, the company has an obligation to a body corporate covered under section 189 of the Companies Act 2013 and the balance amount as on the year end is Rs. 17.50 Lakhs.

i. In our opinion, the rate of interest and other terms and conditions on which the loans had been granted to the body corporate listed in the register maintained under section 189 of the Act where not, prima facie, prejudicial to the interest of the company.

ii. In case of the loans granted to the body corporate listed in the register maintained under section 189 of the Act, the borrower have been regular in the payment of principal and interest as stipulated.

iii. There are no overdue amounts in respect of the loan granted to a body corporate listed in the register maintained under section 189 of the Act.

4. According to the information and explanations given to us the company has complied with provisions of Section 185 and 186 of the Companies Act 2013, with respect to loans and investments made.

5. According to the information and explanations given to us the company has not accepted deposits from general public.

6. In our opinion the company is not required to maintain cost records as required under Sub-section (1) of Section 148 of the Companies Act 201 (Cost Records and Audit Rules 2014).

7. In the respect of statutory dues

According to information and explanations given to us, the company is not regular in depositing undisputed statutory dues including VAT and CST with the appropriate authorities. Further according to the information and explanation given to us, subject to interest of Rs.6,18,136.50/- u/s 201 and 234E of Income Tax Act 1961 for delay remittance of TDS and delay in filling of TDS Return and Sales Tax liability of Rs.28,396/- for the year ending 2010-2011 and Rs.34,210/- for the year ending 2011-2012, which is outstanding for more than 6 months from the date the became payable, there are no arrears of undisputed statutory dues outstanding As on 31st March 2017 for the period of more than 6 months from the date they became payable.

Further According to the information and explanation given to us, excepting disputed Income Tax liabilities of Rs.1,87,002/- for the Assessment Year 2012-2013 to 2015-2016 pending rectification before the central processing centre of Income Tax Bangalore and disputed Sales Tax liability of Rs.39,07,932/- for the year ending 2011-2012 pending before Appellate Deputy Commissioner, Chennai and disputed Sales Tax liability of Rs.10,65,755/- for the year ending 2013-2014, also pending before the Appellate Deputy Commissioner, Chennai, There are no other Disputed demand.

8. In our opinion according to the information and explanation given to us the company has not default in repayment of loan or borrowing from bank.

9. According to the information and explanation given to us, the company as during the year not raised moneys by way of initial public offer nor by way of term loans. Hence paragraph 3(ix) is not applicable to the company.

10. According to the information and explanation 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.

11. According to the information and explanation given to us, the company has paid managerial remuneration during the year and has complied with the provision of Section 197 of Companies Act, 2013.

12. According to the information and explanation given to us, in our opinion, the Company is not a Nidhi Company. Hence paragraph 3(xii) of the order is not applicable.

13. In our opinion, all transactions with the related parties are in compliance with section 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

14. According to the information and explanation given to us, the company has not made any preferential allotment or private placement of share or fully or partly convertible debentures during the year under review.

15. In our opinion and according to the information and explanation given to us, the company has not entered into any non-cash transaction with any of the parties in Section 192 of the Companies Act, 2013.

16. In our opinion and according to the information and explanation given to us, the company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

Date : 22.06.2017 For SIDHARTH MEHTA & CO.,
Place: Chennai Chartered Accountants
(SIDDHARRTH MEHTA)
Proprietor
Member ship No. 207043
Firm Reg. No. 008108S.

ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT OF RCL RETAIL LIMITED.

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 internal financial controls over financial reporting of RCL RETAIL LIMITED ("the company") as of March 31, 2017 in conjunction with our audit of 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 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". 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 the companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of 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 judgement, including the assessment of the risks of material misstatement of the 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 these 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 payments of the company are being made only in accordance with authorizations of management and directors of the company ;

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the companys assets that could have material effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

Because of the inherent limitations of internal control 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 subjected to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that degree of compliance with the policies or procedures may deteriorate.

OPINION

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 March 31, 2016, 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.

Date: 22.06.2017 For SIDHARTH MEHTA & CO.,
Place: Chennai Chartered Accountants
(SIDDHARRTH MEHTA)
Proprietor
Member ship No. 207043
Firm Reg. No. 008108S.