Sadhana Nitro Chem Ltd Auditors Report.

TheAnnexure referred to in independent auditors report to the members of the Company on the standalone IND AS financial statements of Sadhana Nitro Chem Limited for the year ended 31st March 2018.We report that:

i) a) The company has generally maintained proper records, showing full particulars including quantitative details and situation of property, plant and equipment.

b) property, plant and equipment have been physically verified by the Management during the year based on a phased programme of verifying all the assets over three years, which in our opinion is reasonable having regard to the size of the company and the nature of its property, plant and equipment. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.

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.

ii) The Management has conducted physical verification of inventory at reasonable intervals and no material discrepancies were noticed on physical verification.

iii) The Company has granted loan to a Company covered in the register maintained under section 189 of the Companies Act, 2013("theAct").

a) In our opinion , the rate of interest and other terms and condition on which the loan had been granted to

the company listed in the register maintained under Section 189 of the Act was not , prima facie ,

prejudicial to the interest of the Company.

b) The schedule of repayment of principal and payment of interest is not stipulated and in absence of such a schedule , we are unable to comment on the regularity of the repayments or receipts of principal amounts and interest.

c) There are no overdue amounts in respect of the loan granted to a company covered in the register

maintained under Section 189 of the Act.

iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made. The Company has not provided any guarantees / security.

v) The Company has not accepted any deposits from the public.

vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of

the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company

pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii) According to the information and explanations given to us, in respect of statutory dues:

a) There were delays by the Company in depositing undisputed statutory dues, including Provident Fund,

EmployeesState Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess

and other material statutory dues applicable to it to the appropriate authorities.

b) There were no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues in arrears as at March 31,2018 for a period of more than six months from the date they became payable.

c) According to the information and explanations given to us, there are no dues of income tax, sales-tax,service tax, customs duty and cess which have not been deposited on account of any dispute except as given below:

Name of Statue Nature of Dues Forum where dispute is pending Period to which the amount relates Amount involved (Rs) Amount Pending (Rs)
Maharashtra Value Added Tax Ad Maharashtra Value Added Tax Ad Maharashtra Value Added Tax Tribunal A.Y :2012-13 12,48,439/- 6,98,439/-
Income Tax Ad Income Tax Commissioner of Income Tax - Appeals, Mumbai A.Y : 2014-15 55,180/- 55,180/-

viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks or government. The Company did not have any borrowings during the year by way of debentures.

ix) According to the information and explanations given to us , the Company has not raised any money by way of public issue or further public offer (including debt instruments) during the year. The term loans raised by the company have been applied for the purpose for which they were raised.

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.

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

xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

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 details of such transactions have been disclosed in the standalone Ind AS financial statements as required by the applicable accounting standards.

xiv) According to the information and explanations give to us and based on our examination of the records of

theCompany, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year except of issue of sweat equity shares to a Director in accordance with the Issue o f

Sweat Equity Regulations, 2002 issued by Securities and Exchange Board of India.

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

xvi) The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934.

For Chandrashekar Iyer & Co

Chartered Accountants Firm Registration No: 114260W

Place: Mumbai Date: April 30, 2018 Chandrashekhar Iyer

Partner

Membership No.47723

ANNEXURE "B" TO AUDITORS REPORT

Referred to in paragraph 2(f) of our report of even date

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("theAct")

1. We have audited the internal financial controls overfinancial reporting of Sadhana Nitro Chem Limitedfthe Company") as of March 31,2018 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

2. 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 (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 underthe Companies Act, 2013.

Auditors Responsibility

3. Our responsibility is to express an opinion on the Companys internal financial controls overfinancial 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.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system overfinancial reporting and their operating effectiveness. Our audit of internal financial controls overfinancial 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 financial statements, whetherdue to fraud or error.

5. 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 overfinancial reporting.

Meaning of Internal Financial Controls over Financial Reporting

6. 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

7. Because of the inherent limitations of internal financial controls overfinancial 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 overfinancial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31st March, 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 Chandrashekar Iyer & Co

Chartered Accountants Firm Registration No: 114260W Chandrashekhar Iyer

Place: Mumbai Partner

Date: April 30, 2018 Membership No.47723