SEL Manufacturing Company Ltd Auditors Report.

To the Members of

SEL Manufacturing Company Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SEL Manufacturing Company Limited ("the Company"), which comprise the Balance Sheet as at 31st, March 2018, 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 significant accounting policies and other explanatory information (hereinafter referred to as "Standalone Ind AS financial statements"), in which are incorporated the returns for the year ended on that date audited by the branch auditors of the companys overseas branch at Sharjah, United Arab Emirates.

Managements Responsibility for the Standalone Ind AS Financial Statements

The Companys Board of Directors is responsible for the matter stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to 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 the relevant rules issued there under.

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 Standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

The Honble National Company Law Tribunal, Chandigarh ("NCLT") on April 11th, 2018 admitted the Corporate Insolvency Resolution Process ("CIRP") application filed against the Company and appointed Mr. Navneet Kumar Gupta having IP Registration No. IBBI/IPA-001/IP-P00001/2016-17/10009 as Interim Resolution Professional ("IRP") in terms of the Insolvency and Bankruptcy Code, 2016 ("Code")vide order dated 25th April 2018 to manage the affairs, business and assets of the company. The company has preferred an appeal against the admission of petition and appointment of IRP with National Company Law Appellate Tribunal (NCLAT).The CIRP has since been kept in abeyance vide order date 22nd June, 2018 of Honble High Court of Punjab & Haryana. In view of the abovesaid order of Honble High Court of Punjab & Haryana, the powers and responsibilities to manage the affairs, business and assets of the company is vested with the Board of Directors of the company.

Auditors Responsibility

Our responsibility is to express an opinion on these Standalone 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 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 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 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 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

Basis for Qualified Opinion

We refer to:

1) Note No. 38 to the Standalone Ind AS financial statements in respect of non provision of interest on borrowings from banks (classified as NPA) amounting Rs.54084 lakhs & Rs. 35901 lakhs (amount calculated after considering the rates and terms and conditions stipulated originally as per CDR package) for the year ended 31st March, 2018 & 31st March 2017respectively. The same is not in compliance with the requirements of para 27 of the Ind AS 1- Presentation of Financial Statements w.r.t. preparation of financial statements on accrual basis. Consequently, borrowings are not reflected at fair value in financial statements as required by Ind AS 109, Financial Instruments.

2) Note no. 13 (Other Financial Assets) to the Standalone Ind AS financial statements includes interest subsidy receivable amounting to Rs.26,621 Lakhs which consists of interest subsidy (i) under TUFS from Ministry of Textiles and (ii) Subsidy under Textile Policy of Government of Madhya Pradesh for the Financial years 2013-14 to 2016-17 for which no confirmation was available The company has not provided for any allowance under ECL there against.

3) The company has not provided to us for our review any working regarding impairment testing being conducted to assess recoverable amount of Capital work in progress of Rs16986 lakhs outstanding as at 31st March 2018. We are unable to comment on whether the company needs to make a provision in respect of impairment losses on above as required under Ind AS 36.

4) Note no. 40(c), to the Standalone Ind AS financial statements relating to write down of inventories of Raw materials, Work in Progress, Finished Goods identified as non-moving, slow moving, obsolete and damaged inventory to net realizable value by Rs 40710 lakhs for which the company has not provided to us any technical market/commercial evaluation for the same to justify its reasonableness. Being a technical matter we are unable to comment on the loss recognized by the company due to write down of inventories to net realizable value.

5) Note no.18, 20 and 22 to the Standalone Ind AS financial statements in respect of Borrowings (Non Current), Short Term Borrowings and other Financial Liabilities (Current) contains secured loans from banks. There is shortfall in the carrying value of the security against the secured loans consequently the loans are not fully secured.

We further report that, had the impact of our observations made in paragraph 1 of Basis for qualified opinion paragraph been considered, the net loss for the year ended 31st March, 2018 would have been increased by Rs. 54084 lakhs and the borrowings for the year ended 31st March 2018 and 31st March 2017 would have been increased by Rs. 89985 lakhs & Rs. 35901 lakhs and Equity would have been reduced by the same amount for the years ended 31.3.2018 and

31.3.2017 respectively. The financial impact of matters stated in paragraphs 2,3,4&5 to the Basis for Qualified Opinion cant be measured reliably.

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 the above para of "Basis for Qualified Opinion" of our report, that 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, of the state of affairs of the Company as at March 31,2018 and its loss, its cash flows and the changes in equity for the year ended on that date.

Material Uncertainty Related to Going Concern

Note no. 37 of the StandaloneInd AS financial statements, stating thereto that the terms and conditions of the sanctioned CDR package w.r.t. interest and principal repayment were not complied with. Consequently , State Bank of India, in its capacity as financial creditor had filed a petition under Insolvency and Bankruptcy Code, 2016 (IBC) against the company with Honble National Company Law Tribunal, Chandigarh Bench (NCLT) which was admitted on 11th April 2018 and Corporate Insolvency Resolution Process (CIRP) has been initiated in terms of IBC. The company has preferred an appeal against the admission of petition and appointment of IRP with nClat. The CIRP has since been kept in abeyance vide order dated 22.06.2018 of Honble High Court of Punjab and Haryana. The company has incurred net loss of Rs.222643lakhs resulting into accumulated losses of Rs. 296335 lakhs leading to erosion of entire net worth and current liabilities have exceeded the current assets of the company, Further concerning the companys ability to realize the value of inventories, trade receivables and other financial assets, meet its contractual/ financial obligations w.r.t. repayment of overdue principal and accrued interest on secured borrowings, arranging working capital for ensuring normal operations, further investments required towards ongoing projects under construction and the Corporate guarantee given on the behalf of its subsidiary namely SEL Textiles Limited. Moreover the company has derecognized Deferred Tax assets and MAT credit since availability of future taxable income is not certain. Due to financial constraints, the company has started job work operations in major spinning plants instead of pursuing its own manufacturing activities since November 2017. These conditions indicate the existence of a material uncertainty that may cast significant doubt on the companys ability to continue as going concern and therefore company may be unable to realize its assets and discharge its liabilities in the normal course of business.

Emphasis of Matter

We draw attention to the following matters:

(1) Note No. 37(c) of the Standalone Ind AS financial statements in respect of Contingency related to compensation payable in lieu of bank sacrifice, the outcome of which is materially uncertain and cannot be determined currently.

(2) Note No. 34 A (iv) of the Standalone Ind AS financial statements in respect of contingency related to export incentives obligation refundable amounting Rs. 3855 lakhs in respect of allowance for foreign trade receivables, which is further subject to interest and penalties. the amount of such obligation cannot be determined currently.

(3) Note No. 34 A (iii) of the Standalone Ind AS financial statements in respect of contingency related to Income Tax demands raised by the Income Tax Authorities amounting Rs. 27854 Lakhs for various matters,which is further subject to interest and penalties,the amount of such obligation cannot be measured with sufficient reliability.

(4) Note no. 39, to the Standalone Ind AS financial statements regarding the balance confirmations of Trade Receivables, Capital/Trade Advances & Trade Payables. During the course of preparation of Standalone Ind AS financial statements, e-mails/letters have been sent to various parties by the company with a request to confirm their balances as on 31st March, 2018 out of which few parties have confirmed their balances direct to us or to the company.

(5) As reported vide note 40(a) to the Standalone Ind AS financial statements, the company has provided for allowance of Rs.88093 lakhs in respect of Trade Receivables due to change in probability factor in estimating Expected credit losses (under ECL Model) as reported in para 3 to the financial statements. Further, Note No. 40(b) to the Standalone Ind AS financial statements, the company has provided for impairment loss of Rs. 3584 Lakhs in respect of long outstanding Capital/Trade Advances given to suppliers.

(6) Note No. 34(B), to the Standalone Ind AS financial statements in respect of Capital Commitments contains uncertainty regarding contracts yet to be executed, escalation costs and other additions to the reported figures, if any. Being a technical matter, we are unable to comment on the total contingent capital commitment figure reported as the same cannot be measured with sufficient reliability.

Our opinion is not modified in respect of matters reported in para (1) to (6) of Emphasis of Matter.

Other Matter

We did not audit the financial statements of Overseas branch included in the Standalone Ind AS financial statements of the Company whose financial statements reflect NIL total assets as at 31st March, 2018 and NIL revenues for the year ended on that date, as considered in the Standalone Ind AS financial statements. The financial statements of the branch has been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of the branch, is based solely on the report of such branch auditors.

Our opinion is not modified in respect of this matter.

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 terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in the paragraph 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 purpose 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 and proper returns adequate for the purpose of our audit have been received from the companys overseas branch at United Arab Emirates not visited by us;

c. The reports on the accounts of the branch office of the Company audited under Section 143 (8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d. The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account and with the returns received from the companys overseas branch at United Arab Emirates audited by other auditors.

e. In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under section 133 of the Companies Act, 2013, read with relevant rules except noncompliance of provisions of para 42(b) of Ind AS 8,Accounting Policies, Changes in Accounting Estimates and Errors, which requires disclosure of restated opening balances of assets, liabilities and equity for the earliest prior period presented which had not been made by the company in the Standalone Ind AS statement of assets and liabilities.

f. In our opinion, the matters described in the "basis of Qualified Opinion" and "emphasis of matter" paragraphs above may have an adverse impact on the functioning of the company.

g. On the basis of written representations received from the directors as on March 31, 2018 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2018, from being appointed as a director in terms of Section 164 (2) of the Companies Act, 2013;

h. 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"; and

i. 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 of pending litigations on its financial position in its standalone Ind AS financial statements - Refer note no. 34 to the standalone 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.

FOIR MALHOTRA MANIK & ASSOCIATES
CHARTERED ACCOUNTANTS
FRN. 015848N
PLACE: LUDHIANA (CA. MANIK MALHOTRA)
DATED: 05.07.2018 PROPRIETOR
M.No.:094604

Annexure-A to the Independent Auditors Report

The Annexure referred to the Independent Auditors Report to the members of the company on the Standalone Ind AS financial statements for the year ended on 31st March, 2018. We report that:

(1) (a)The Company has maintained proper records showing particulars including quantitative details and situation of fixed assets except for certain items of fixed assets, the quantitative details of which are in the process of being compiled. As explained to us, the same will be compiled by the management in due course of time.

(b) According to the information and explanations given to us, the Company has adopted a policy of physical verification of fixed assets once in every three years. However, the Company has not physically verified any of the fixed assets during the year under audit.

(c) According to the information and explanation 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) In our opinion and according to the information and explanation given to us, the physical verification of inventories has been conducted at reasonable interval by the management and no material discrepancy was noticed on physical verification as compared to the book records.

(iii) In our opinion and according to the information and explanation given to us, the Company has not granted any loans secured or unsecured, to Companies, Firms and other parties covered in the register maintained section 189 of the Companies Act, 2013.

(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 Companies Act, 2013 in respect of loans, investments, guarantees and security.

(v) The Company has not accepted deposits from the public within the meaning of provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under. No order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other Tribunal on the company.

(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 of the Companies Act, 2013 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of such records with a view to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and the books and records examined by us, we state that the company is regular in depositing undisputed statutory dues including income tax, provident fund, employees state insurance, custom duty, Goods & services tax, excise duty, service tax, value added tax,cess and other statutory dues to the appropriate authorities. According to the information and explanations given to us, there were no undisputed amounts payable in respect of income tax, provident fund, employees state insurance, custom duty, Goods & services tax, excise duty, service tax, value added tax, cess and other material statutory dues in arrears, as at 31st March, 2018 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us there are no dues of income tax, provident fund, employees state insurance, custom duty, goods & services tax, excise duty, service tax, value added tax, cess and other statutory dues, which have not been deposited on account of any dispute except disclosed as under:

Name of the statute Nature of dues Amount (In Lakhs) Period to which the amount relates (Assesment Year) Forum where the dispute is pending
Income Tax Act, 1961 Tax and Interest* 27853.69 2010-11 2011-12 & 2013-14 ITAT, Chandigarh
Income Tax Act, 1961 Tax deducted at source 3.92 2009-10 to 2015-16 CPC, Bangalore

*Interest calculated upto 31.01.2018 and subject to further interest & penalty proceedings.

(viii) In our opinion and according to the information and explanations given to us, the company has defaulted in repayment of loans/borrowings and interest thereon to banks as given below:

Bank Name Nature of Amount Amount Overdue

Since

State Bank of India Interest 2151273757 31.07.2016
Principle 270190825 30.06.2016
Interest 2665852542 30.04.2016
Principle 421276872 30.04.2016
Interest 1246880296 31.05.2015
Principle 359914069 31.08.2015
Interest 761825336 31.08.2015
Principle 264594581 31.10.2015
Interest 2603318721 31.01.2016
Principle 417758097 31.01.2016
Punjab & Sind Bank Interest 322345721 31.12.2015
Principle 133857937 31.12.2015
Bank of Maharashtra Interest 124760780 30.11.2015
Principle 194762373 30.09.2015
Punjab National Bank Interest 972982306 28.02.2016
Principle 368890523 31.01.2016
Indian Bank Interest 678847025 30.06.2015
Principle 146193757 31.07.2015
Sber Bank Interest 242158446 31.03.2016
United Bank Interest

Principle

178440444

321376503

30.06.2015

31.07.2015

Union Bank of India Interest

Principle

489302126

129904929

30.04.2015

30.04.2015

UCO Bank Interest 608386292 30.09.2015
Principle 272576919 31.08.2015
Corporation Bank Interest 2006917518 31.01.2016
Principle 266474022 31.03.2016
Allahabad Bank Interest 3209358134 31.10.2015
Principle 831217408 30.11.2015
Dena Bank Interest 177351067 31.10.2015
Principle 237793438 31.10.2015
Indian Overseas Bank Interest 1497875295 31.01.2016
Principle 67620190 31.03.2016
Vijaya Bank Interest 16081796 31.03.2016
Principle 17164076 31.03.2016
Andhra Bank Interest 1027795009 28.02.2016
Principle 54555840 31.03.2016
EXIM Bank Interest 8274928 31.05.2016
Principle 6471034 31.01.2016

(ix) In our opinion and according to the information and explanations given to us, no money was raised by way of initial public offer or further public offer (including debt instruments) and term loans during the year.

(x) To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company, by its officers or employees has been noticed or reported during the year.

(xi) According to the information and explanations given to us and the audit procedures conducted by us, managerial remuneration has been paid or provided was in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.

(xii) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 3 (xii) of the Companies (Auditors Report) Order, 2016, are 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, all transactions with the related parties are in compliance with Section 177 and 188 of Companies Act, 2013 where applicable and the details of the 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 given to 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 and therefore, the provisions of clause 3 (xiv) of the Companies (Auditors Report) Order, 2016, are not applicable to the Company.

(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 any non-cash transactions with directors or persons connected with the directors and therefore, the provisions of clause 3 (xv) of the Companies (Auditors Report) Order, 2016, are not applicable to the Company.

(xvi) In our opinion and according to the information and explanations given to us, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

FOR MALHOTRA MANIK & ASSOCIATES
CHARTERED ACCOUNTANTS
FRN. 015848N
PLACE: LUDHIANA (CA. MANIK MALHOTRA)
DATED: 05.07.2018 PROPRIETOR
M.No. 094604

ANNEXURE- B TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 1(h) under the "Report on other legal and regulatory requirements" of our report of even date)

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")

We were engaged to audit the Internal Financial Control over financial reporting of SEL Manufacturing Company Limited ("the Company") as of 31st March, 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 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 (the Guidance Note) issued by the Institute of Chartered Accountants of India(the 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 the companys 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 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, to the extent applicable to an audit of internal financial controls, 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 control 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 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 qualified audit opinion on the Companys internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial controls 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 controls 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 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 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 internal financial controls over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Disclaimer of Opinion

The system of internal financial controls over reporting with regard to the company were not made available to us to enable us to determine if the company has established adequate internal financial control over financial reporting and whether such internal financial controls operating effectively as on 31st March 2018.

Basis for Qualified Opinion

In our opinion and acc ort which came to our notice during the course of audit of standalone Ind AS financial statements indicates material weaknesses in the internal financial controls over financial reporting as at March 31,2018.

A material weakness is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the companys annual or interim financial statements will not be prevented or detected on timely basis.

Qualified Opinion

In our opinion, the matters disclosed in above paragraphs under "Basis of Qualified Opinion" indicates material weaknesses in the internal financial controls over financial reporting.

We have considered the disclaimer of opinion as well as material weaknesses identified and reported in Qualified Opinion paragraph in determining the nature, timing, and extent of audit tests applied in our audit of the financial statements of the Company for the year ended March 31,2018, and the disclaimer and material weaknesses do not affect our opinion on the financial statements of the Company

FOR MALHOTRA MANIK & ASSOCIATES
CHARTERED ACCOUNTANTS
FRN. 015848N
(CA. MANIK MALHOTRA)
PLACE: LUDHIANA PROPRIETOR
DATED: 05.07.2018 M.No.:094604