ఆడిటర్ నివేదిక Apt Packaging Ltd.

Mar 31, 2025

1. We have audited the accompanying standalone financial statements of Apt Packaging Limited
having CIN: L24100MH1980PLC022746 (“the Company”), which comprise the Standalone Balance
Sheet as at 31^st March 2025, the Standalone Statement of Profit and Loss (including other
comprehensive income), Standalone Statement of Cash Flows and Standalone Statement of Changes
in Equity for the year then ended, and notes to the Standalone financial statements, including a
summary of material accounting policies and other explanatory information.

2. 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 aforesaid
standalone financial statements give the information required by the Companies Act, 2013 (‘the Act'') in
the manner so required and give a true and fair view in conformity with Indian Accounting Standards
prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards)
Rules, 2015, as amended (“Ind AS”) and the other accounting principles generally accepted in India, of
the state of affairs of the Company as at 31st March 2025 and its profit (financial performance
including other comprehensive income), the changes in equity and its cash flows for the year ended on
that date.

Basis for Qualified Opinion

3. We conducted our audit in accordance with Standards on Auditing (SAs) specified under section
143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s
Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are
independent of the Company in accordance with the Code of Ethics issued by the Institute of
Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our
audit of the Standalone financial statements under the provisions of the Act and the rules there under,
and we have fulfilled our other ethical responsibilities in accordance with these requirements and the
ICAI''s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our qualified opinion.

Qualification

4. a. The company has not provided/ paid interest of Rs 0.57 Lakhs for the year on delayed payment to
parties covered under the provisions of Micro, Small and Medium Enterprises Development Act,
2006. Refer note no 16.2 to the financial statements.

b. The company has not provided GST liability totaling Rs. 20.70 Lakhs for the financial year 2019¬
20 for the reasons stated in note no - 29(g) to the financial statements. The appeal against this order
has been filed before the appellate authority.

c. The balances of Trade Receivable, Trade Payable, Unsecured Loans, Employees, Loans and
Advances are subject to confirmations and reconciliation. Refer note no 33 to the financial
statements.

d. Attention is invited to note no 7.4 to the financial statement in respect of non-provisioning of
doubtful debts amounting Rs. 11.45 Lakhs.

Emphasis of Matter

5. a. The company is valuing its stock on first in first out basis based upon the physical verification of
inventory conducted by the management at the year end. The Company has yet to implement a
system by which the valuation is derived based on the purchases and consumption records
maintained in the computer system.

b. The interest on unsecured loans availed from related and other unrelated parties has not been
provided for in view of waiver of interest for the current year received from lenders.

c. We draw attention to Note No. 31 to the financial statements, which states that the Company''s
accumulated losses have exceeded its net worth as at the balance sheet date. Notwithstanding this,
the financial statements have been prepared by the management on a going concern basis.

Subsequent to the year end, the Company has made a preferential allotment of equity shares on
May 8, 2025, for a total consideration of Rs1,965.00 lakhs (including share premium), resulting in a
positive net worth.

Our opinion is not modified in respect of above matters.

Information other than the Standalone Financial Statements and Auditor’s Report thereon

6. The Company''s Board of Directors is responsible for the other information. The other information
comprises the information included in the annual report but does not include the financial statements
and our auditor''s report thereon.

7. Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.

8. In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with
the financial statements, or our knowledge obtained in the audit or otherwise appears to be
materially misstated. If, based on the work we have performed, we conclude that there is material
misstatement of this other information; we are required to report that fact. We have nothing to report
in this regard.

Management’s Responsibility for the Standalone Financial Statements

9. The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act
with respect to the preparation of these standalone financial statements that give a true and fair view
of the financial position, financial performance (including other comprehensive income), changes in
equity and cash flows of the Company in accordance with the accounting principles generally
accepted in India, including the Ind AS specified under section 133 of the Act. 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 financial
statement that give a true and fair view and are free from material misstatement, whether due to fraud
or error.

10. In preparing the financial statements, management is responsible for assessing the Company''s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless management either intends to liquidate the Company or
to cease operations, or has no realistic alternative but to do so.

11. The Board of Directors is also responsible for overseeing the Company''s financial reporting process.

Auditor’s Responsibilities for the Audit of the Standalone Financial Statements

12. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with Standards on Auditing will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.

13. As part of an audit in accordance with Standard on Auditing, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:

a. Identify and assess the risks of material misstatement of the standalone financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk
of not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.

b. Obtain an understanding of internal financial controls relevant to the audit in order to design audit
procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are
also responsible for expressing our opinion on whether the Company and its subsidiary
companies which are companies incorporated in India, has adequate internal financial controls
system in place and the operating effectiveness of such controls.

c. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

d. Conclude on the appropriateness of management''s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the ability of the Company to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor''s report to the related disclosures in the standalone financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor''s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.

e. Evaluate the overall presentation, structure and content of the standalone financial statements,
including the disclosures, and whether the standalone financial statements represent the
underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the standalone financial statements that,
individually or in aggregate, makes it probable that the economic decisions of a reasonably
knowledgeable user of the standalone financial statements may be influenced. We consider
quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in
evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in
the standalone financial statements.

14. We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.

15. We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.

16. From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the standalone financial statements of the current period
and are therefore the key audit matters. We describe these matters in our auditor''s report unless law
or regulation precludes public disclosure about the matter or when, in extremely rare circumstances,
we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of
such communication.

Report on Other Legal and Regulatory Requirements

17. As required by the Companies (Auditor''s Report) Order, 2020 (“the Order”), issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give
in the “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order, to the
extent applicable. 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 subject to our comment on edit log in para (h) (vi) below,
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, and the Statement of Cash Flow dealt with
by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified
under Section 133 of the Act, read with the Companies (Accounting Standard) Rules, 2015 as
amended.

(e) On the basis of the written representations received from the directors as on 31st March, 2025
taken on record by the Board of Directors, none of the directors is disqualified as on 31st March,
2025 from being appointed as a director in terms of Section 164 (2) of the Act.

(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”.

(g) In our opinion and to the best of our information and according to the explanations given to us,
the remuneration paid by the Company to its directors during the year is in accordance with the
provisions of section 197 of the Act.

(h) With respect to the other matters to be included in the Auditor''s 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 financial statements - Refer Note 29 to the 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.

iv. (a) the Management has represented that, to the best of its knowledge and belief, no
funds (which are material either individually or in the aggregate) have been advanced or
loaned or invested (either from borrowed funds or share premium or any other sources or
kind of funds) by the company to or in any other person or entity, including foreign entity
(“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that
the Intermediary shall, whether, directly or indirectly lend or invest in other persons or
entities identified in any manner whatsoever by or on behalf of the company (“Ultimate
Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate
Beneficiaries;

(b) the Management has represented, that, to the best of its knowledge and belief, no
funds (which are material either individually or in the aggregate) have been received by
the company from any person or entity, including foreign entities (“Funding Parties”), with
the understanding, whether recorded in writing or otherwise, that the company shall,
whether, directly or indirectly, lend or invest in other persons or entities identified in any
manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or
provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and.

(c) Based on audit procedures that have been considered reasonable and appropriate in
the circumstances, nothing has come to our notice that has caused us to believe that the
representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b)
above, contain any material mis-statement.

v. The company has not declared a dividend including interim dividend.

vi. As per the information and explanations given to us and based on our examination, which
included test checks, the accounting software of the company in which books of accounts
are maintained during the year does not have feature of recording audit trail (edit log)
facility.

For Gautam N Associates
Chartered Accountants
FRN: 103117W

SD/-

Gautam Nandawat
Partner
M No: 032742
UDIN:25032742BMJJLA4489

Place: Chhatrapati Sambhajinagar
Dated: 28^th May 2025

---

Mar 31, 2014

We have audited accompanying financial statements of APT Packaging Limited (''the Company''), which comprise the Balance Sheet as at 31** March 2014, the Statement of Profit & Loss and the Cash Flow Statement for the year ended and a summary of significant accounting policies and other explanatory information.

Management'' Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flow of the company in accordance with Accounting Standard referred to in-sub section (3C) of section 211 of the Companies Act, 1956(''the Act'') read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013; General Circular 08/2014 dated 4"'' April, 2013 of the Ministry of Corporate Affairs the financial statement, auditor''s report and board reports are prepared and presented according to the relevant provisions / schedules / rules of the Companies Act 1956 and in accordance with the accounting prindples generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control 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 conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountant of India. Those standards require that we comply with ethical requirement and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosure in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statement in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing opinion on the effectiveness of the company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting policies used and the reasonableness of the accounting estimate made by management, 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.

Opinion

1) The accounts of the Company for the year have been prepared on a ''Going Concern'' basis, as the Company has once again declared as a Sick Company by The Board for Industrial and Financial Reconstruction (BIFR) as per hearing held on 01 10-2013 vide their order dated 20 / 11 / 2013.The "PNB" has been appointed as the ''Operating Agency'' [OA] by the BIFR. According to information and explanation given to us the company is in the process of preparing the draft rehabilitation scheme which is to be submitted before the BIFR and OA

2) The outstanding balances of debtors, creditors, loans and advances including inter corporate deposit (taken and given),balance with statutory/fisca! liabilities (Assets & Liabilities) i.e. Excise & Service tax deposits/balances subject to confirmations, reconciliation and consequent adjustment, if any. (Refer Note No.37 )

3) There is certain unimplemented portion of sanction scheme (SS07) to be implemented specifically recovery of special capital incentives and interest thereon by Government of Maharashtra, extension of sales tax deferral period for further eight years and past & future interest on the sales tax deferral dues of the resulting company Machhar Industries Ltd. while discharging the company as SICK Industrial company which was declared as a SICK Company on 17.12.2002 by the Hon''ble BIFR vide its order dated 16.06.2011 and accordingly, while preparing and presenting the financial statements for the year under consideration the company has followed the order of BIFR. (Refer Note No 34)

4) In our opinion subject to stated above and to the best of our information and according to the explanations give to us, the aforesaid financial statements give the information required the Act in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India:

a) In the case of Balance Sheet, of the state of affairs of the company as at March 31, 2014;

b) In the case of the Statement of Profit and Loss, of the Loss 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 (Auditor''s Report) Order, 2003(''the Order'') as amended, issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of test checks of the books and the records of the company and according to the information and explanations given to us, we annexed hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2) Further to our comments in the Annexure referred to above, we report that:

a) Subject to what is stated at point no.2 in section ''Opinion'', we have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion, proper books of accounts as required by Law have been kept by the company as so far as appears from our examination of those books;

c) The Balance Sheet and Statement of Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, Balance Sheet, the statement of Profit & Loss Account and the Cash Flow Statement comply with Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013; General Circular 08/2014 dated 4th April, 2013 of the Ministry of

Corporate Affairs the financial statement;

e) On the basis of the written representations received from the Directors, taken on record by the Board of Directors, and according to the information and explanations given to us, none of the directors is disqualified as on 31st March 2014 from being appointed as a

Director under section 274(1) (g) of the Companies Act, 1956.

ANNEXURE TO THE INDEPENDENT AUDITORS* REPORT

Statement referred to in paragraph 4 & 5 of the Auditor'' Report of even date to the member of APT PACKAGING LIMITED ("the Company"1) on the financial statements for the year ended 31st March, 2014.

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

b) Some of the fixed assets are physically verified during the year by the management in accordance with a program of verification, which in our opinion provides for physical verification of all the fixes assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

c) Fixed Assets are disposed off by the company during the year do not form substantial part thereof.

2) a) As informed to us, the stock of finished goods, work-in-process and raw materials at all the units of the Company have been physically verified by the Management once in a year except for the goods lying with the third parties. In our opinion it should be conducted at least twice in a year.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of stock followed by the management are reasonable and adequate in relation the size of Company and the nature of its business.

c) On the basis of our examination of the records of inventory, we are of the opinion that the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account.

3) a) The Company has taken loans from two directors, one ex-director, six shareholders, three relatives of the director, three promoters Group Company and Resulting Company covered in the register maintained under Section 301 of the Companies Act, 1956 to meet the short fall of Sanctioned Scheme and as per banker''s clause. The maximum amount involved during the year is Rs. 1203.10 Lacs including Opening Balance of Rs. 1084.13 Lacs and the yearend balance of loans taken from such parties was Rs. 947.98 Lacs.

b) According to the information and explanation given to us, out of the above, loan amount of Rs. 68.20 Lacs is Interest free and balance Rs. 879.78 Lacs is interest bearing. For interest bearing unsecured loans the interest is provided. The terms and conditions of these toans are not prejudicial to the interests of the company. The company is regular in repaying the loan amount and interest whenever applicable and as stipulated.

c) The company has not given loans to any firms covered in the register maintained under section 301 of the companies Act, 1956.

4) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

5) a) According to the information and explanation given to us, we are of the opinion that the transaction that needs to be entered in to the register maintained u/s 301 of the Companies Act, 1956 have been so entered.

b) in our opinion and according to the information and explanation given to us, there are transactions exceeding Rs.5 Lacs each which have been made at prices, which are reasonable having regard to the prevailing market prices, for such goods materials or services at the relevant time.

6) The Company has not accepted any deposits from the public within the provisions of section 58A and 58AA of the Companies Act, 1956 and rules framed there under.

7) A In our opinion, the company has an adequate Internal Audit system commensurate with its size and the nature of its business.

8) 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 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie,the prescribed accounts have been made and maintained. ''

9) a) According to the records of the company, the company is generally regular in depositing with the appropriate authorities undisputed statutory dues including P.F., customs, excise duty, income tax,- sales tax, investors education and protection fund, Service Tax, Custom Duty Cess and other material statutory dues applicable except Rs.4.68 lacs.

The statements of Arrears of Statutory dues outstanding for more than six months are as follows:

TYPE OF TAXES AMOUNT IN LACS

Property Tax 3.92

Sales Tax 0.77

b) As at 31st March 2014 according to the records of the company, the following are the particulars of disputed dues on Account on

Sales Tax have not been deposited:

Name of Statute Disputed Liability Rs. Forum where dispute In Lacs is pending

Sales Tax Govt, of 4.75 Sales Tax Authority, Maharashtra Aurangabad / Haridwar.

Property Tax 1.35 Muncipal Corporation Authority, Aurangabad. Income Tax - Carried 0 00 Commissioner of Income Forward (Being Loss Return) Tax Appeals, Aurangabad Unabsorbed Depreciation of Rs. 1354.42 Lacs.

10) The company has accumulated losses exceeding its net worth as on March 31, 2014. The Company has not incurred any cash losses during the financial year covered by our audit considering exceptional items profit at Rs. 177.66 Lacs and there was a cash loss in the financial year immediately preceding current financial year amounting to Rs. 196.36 Lacs.

11) Based on our audit procedures and on the information and explanations given by the management, the company has delayed repayment of loans to banks in respect of term loans. The following are the details of the delays.

Particulars Amount in Lacs Period of Delays

Term loans upto Dec 172.18 Up to 120 days. Paid on 2013 (incl interest or vefore 31-03-2014 of Rs.53.65 Lacs)

Term loans upto Mar 117.30 Lacs 90 days 104.19 Lacs 2014 (Incl Interest Not paid till of Rs.3997 Lacs 31-03-2014.

As at the year end, out of the above delays, term loan amounting to Rs. 172.18 Lacs have been rectified and hence no delays exist to that extent, whereas Rs. 104.19 Lacs still unpaid accordingly delay exist as at March 31, 2014.

12) According to the information and explanations given to us and records of the company, the company has not granted any loans and advances on the basis of securities by way of pledge of shares, debentures and securities. According to the provisions of clause 4(xii) of the Companies (Auditors Report) order, 2003 the same are not applicable to the Company.

13) In our opinion, the company is not a Chit Fund or a Nidhi / Mutual benefit fund/Society. Accordingly, the provisions of clause 4 (xiii) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

14) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other instruments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

15) In accordance with the sanctioned scheme of Demerger and the order of Honorable BIFR, for resulting company, the company has given Guarantees to banks and other creditors for their respective outstanding balances as on cut off date i.e. 01.04.2007 incase if the resulting company fails to pay or shortfall to pay the same. As this is stipulated as per the Sanctioned Scheme ordered by the BIFR, the same is not treated as prejudicial to the interest of the company. According to information and explanations given to us by the managment there is outstanding balance of Rs. 399.36 lacs as on 31.03.2014 on account of Sales tax deferral.

16) According to the records of the Company, information and explanation given to us, the company has obtained term loans during the year under audit and the same were applied for the purpose for which they are raised except Rs.12.16 Lacs kept in cash credit account with lien mark at Punjab National Bank.

17) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we are of the opinion that the Company has used funds to the extent of Rs. 33.77 Lacs raised on short-term basis has been utilized for the repayment of long-term loan (Term Loan) except permanent working capital.

18) During the year, the company has not made any allotment of shares, hence the provisions of clause 4(xviii) of the Companies (Auditors Report) order, 2003 are not applicable to the company.

19) According to the records of the Company, the company has not issued any debentures as per the provisions under clause 4(xix) of the Companies (Auditors Report) order, 2003.

20) The company has not raised any money by Public-issues during the period covered by our Audit report as per the provisions under clause 4(xx) of the Companies (Auditors Report) order, 2003.

21) During the course of our examination of the books records of the company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have been informed of such case by the management.

For Rathi & Bangad Chartered Accountants [Firm Reg. No. 108702W]

Date: 30/05/2014 Dilip D.Jain Place: Aurangabad Proprietor M. No. 044301

---

Mar 31, 2013

Report on the Financial Statements

We have audited accompanying financial statements of APT Packaging Limited (''the Company"), which comprise the Balance Sheet as at 31st March 2013, the Statement of Profit & Loss and the Cash Flow Statement for the year ended and a summary of significant accounting policies and other explanatory information. Management'' Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of trie financial position, financial performance and cash flow of the company in accordance with Accounting Standard/ referred to in sub-section (3C) of section 211 of the Companies Act, 19!-6(''the Act''). The responsibility includes the design, implementation and maintenance of internal control 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 conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountant of India. Those standards require that we comply with ethical requirement and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosure in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statement in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting policies used and the reasonableness of the accounting estimate made by management, 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. Opinion

1. The Accounts of Company for the year have been prepared on a ''Going Concern basis, as the company''s net worth as on '' 31.03.2013 has become negative and accordingly the Company has to inform the same to the Board for Industrial and Financial Reconstruction (BIFR) for registration under Sick Industrial Companies Act, 1985 (SICA). ( Refer Note No 34)

2. The outstanding balances of debtors, creditors, loans and advances (taken and given), are balance with statutory/fiscal liabilities (Assets & Liabilities) i.e. Excise & Service tax deposits/balances subject to confirmations, reconciliation and consequent adjustment, if any. (Refer Note No.37 )

3. There is certain unimplemented portion of sanction scheme (SS07) to be implemented specifically recovery of special capital incentives and interest thereon by Government of Maharashtra and extension of sales tax deferral period for further eight: years while discharging the company as SICK Industrial company which was declared as a SICK Company on 17.12.2002 by the Hon''ble BIFR vide its order dated 16.06.2011 and accordingly, while preparing and presenting the financial statements; for the year under consideration the company has followed the order of BIFR. (Refer Note No 33)

4. In our opinion subject to stated above and to the best of our information and according to the explanations give to us, the aforesaid financial statements give the information required the Act in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India:

a) In the case of Balance Sheet, of the state of affairs of the company as at March 31, 2013;

b) In the case of the Statement til Profit and Loss, of the Loss for the year ended on-that date; and c)'',Jn#ie case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Ligal and Regulatory Requirements

1) As required by the Companies (Auditor''s Report) Order, 2003(''the Order*) as amended, issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of test checks of the books and the records of the company and according to the information and explanations given to us, we annexed hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order. * 2) Further to our comments in the Annexure referred to above, we report that:

a) Subject to what is stated at point no.2 in section ''Opinion'', we have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion, proper books of-accounts as required by Law have been kept by the company as so far as appears, from our examination of those books;

c) The Balance Sheet and Statement of Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, Balance Sheet, Profit & Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards-referred to in subsection (3C) of section 211of the Companies Act 1956;

e) On the basis of the written representations received from the Directors, taken on record by the Board of Directors, and according to the information and explanations given to us, none of the directors is disqualified as on 31st March 2013 from being appointed as a Director under section 274(1) (g) of the Companies Act, 1956.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

Statement referred to in paragraph 4 & 5 of the Auditor7 Report of even date to the member of APT PACKAGING LIMITED ("the Company") on the financial statements for the year ended 31* March, 2013.

1) a. The company has maintained proper records showing full particulars incij^''rig quantative details and situation of fixed assets.

b. Some of the fixed assets are physically verified during the year by the management in accordance with a programme of verification, which in our opinion provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

c. The Fixed Assets are disposed off by the company during the year do not form substantial part tnereof.

2) a. As informed to us, the stock of finished goods, work-in-process and raw materials^ all the units of the Company have been physically verified by the Management once in a year except for the goods lying with the third parties. In our opinion, it should be conducted at least twice a year.

b. *v our opinion and according to the information and explanations given to us, the procedures of physical verification of stock followed by the management are reasonable and adequate in relation the size of Company and the nature of its business.

c. On the basis of our examination of the records of inventory, we are of the opinion that the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account

3) a. The Company has taken loans from three directors, six shareholders, two relatives of the director, three promoters Group Company and Resulting Company covered in the register maintained under Section 301 of the Companies Act, 1956 to meet the short fall of Sanctioned Scheme and as per banker''s clause. The maximum amount involved during the year is Rs. 1084.79 Lacs, , ,

b. According to the information and explanation given to us, out of the above, loan amount of Rs, 73.92 Lacs is Interest free and balance Rs.1010.87 Lacs is interest bearing. For interest bearing unsecured loans the interest is provided. The terms and conditions of these loans are not prejudicial to the interests of the company. The company is regular in repaying the loan amount and interest whenever applicable and as stipulated.

4) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

5) a According to the information and explanation given to us, we are of the opinion that the transaction that needs to be entered

in to the register maintained u/s 301 of the Companies Act, 1956 have been so entered. b. In our opinion and according to the information and explanation given to us, there are transaction exceeding Rs.5 Lacs each which have been made at prices, which are reasonable having regard to the prevailing market prices, for such goods materials or services at the relevant time.

6) The Company has not accepted'' any deposits from the public within the provisions of section 58A and 58AA of the Companies Act, 1956 and rules framed there under.

7) In our opinion, the company has an adequate Internal Audit system commensurate with its size and the nature of its business. However, the company has not carried out internal audit from 1* January, 2013, Jt is highly recommended that tht company should carried out the internal audit for better control & efficient management.

8) According to the information and explanations given to us, cost records have been prescribed under section 209(1) (d) of ¦ theCompanies Act, 1956. The records are under Compilation/Preparation and could not be reviewed.

9) a. According to the records of the company, the company is generally regular in depositing with the appropriate authorities undsputed statutory dues including P.F., customs, excise duty, income tax, sales tax, investors education and protection fund, Service Tax, Custom Duty Cess and other material statutory dues applicable except Rs.5.98 lacs.

10) The company has accumulated losses exceeding its net worth as on March 31, 2013. The Company has suffered cash losses amounting to Rs.196.36 Lacs during the financial year covered by our audit and there was a cash loss in the financial year immediately preceding currant financial year amounting to Rs.59.50 Lacs:

11) Based on our audit procedures and on the information and explanations given by the management, the company has delayed repayment of loans to banks irfrespect of term loans .The following are the details of the delays.

Particulars Amount in Lacs Period of Delays

Term loans 368.2 Up to 60 days

As at the year end, these delays have been rectified and hence no delays exist as at March 31, 2013.

12) According to the information and explanations given to us and records of the company, the company has not granted any loans and advances on the basis of securities by way of pledge of shares, debentures and securities. According to the provisions of clause 4(xii) of the Companies (Auditors Report) order, 2003 the same are not applicable to the Company.

13) In our opinion, the company is not a Chit Fund or a Nidhi / Mutual benefit fund/Society. Accordingly, the provisions of clause 4 (xiii) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

14) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other instruments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

15) In accordance with the sanctioned scheme Of Demerger and the order of Honorable BIFR, for resulting company, the company has given Guarantees to banks and other creditors for their respective outstanding balances as on cut off date le. 01.04.2007 incase if the resulting company fails to pay or shortfall to pay the same . As this is stipulated as per the Sanctioned Scheme ordered by the BIFR, the same is not treated as prejudicial to the interest of the company. According to infonwation and explanations given to us by the management there is outstanding balan6e ofRs. 399.36 lacs as on 31.03.2013 on account of Sales tax deferral.

16) According to the records of the Company, information and explanation given to us, the company has obtained term loans during the year under audit and the same were applied for the purpose for which they are raised except Rs.24.33 Lacs kept in current account with Punjab National Bank.

17) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we are of the opinion that the Company has not used funds raised on short-term basis for long-term investment except permanent working capital. ¦ -

18) During the year, the company has not made any allotment of shares, hence the provisions of clause 4(xviii) of the Companies (Auditors Report) order, 2003 are not applicable to the company.

19) According to the records of the Company, the company has not issued any debentures as per the provisions under clause 4(xix) of the Companies (Auditors Report) order, 2003.

20) The company has not raised any money by Public-issues during the period covered by our Audit report as per the provisions under clause 4(xx) of the Companies (Auditors Report) order, 2003.

21) During the course of our examination of the books records of the company, carried out in accordance with the generally accepted auditing practices in tndia, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have been informed of such case by the management. For Rathf & Bangad

Chartered Accountants

Firm Reg. No. 108702W]

Dilip D. Jain

Date: 06.07.2013

Place: Aurangabad M. No. 044301

---

Mar 31, 2012

We have audited the attached Balance Sheet of APT PACKAGING LIMITED as at 31st March 2012, the Profit & Loss Account of the Company and the Cash Flow Statement for the year ended on that date (together referred to as "Financial statement"). These financial statements are the responsibility of the Company's management. Our responsibility is to express opinion on these financial statements based on our audit.

We have conducted our audit in accordance with the auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit Includes, examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable, basis for our opinion.

In accordance with the provisions of the Companies Act, 1956, we report that:

1) As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India In terms of Section 227(4A) of the Companies Act, 1956, and on the basis of test checks of the books and the records of the company and according to the information and explanations given to us, we annexed hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2) Further to our comments in the Annexure referred to above, we report that:

a) Subject to what is stated at point no. 'h and I below, we have obtained all the information and explanation, which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion, proper books of accounts as required by Law have been kept by the company as far as appears from our examination of these books.

c) The Balance Sheet and Profit & Loss Account referred to in this report are in agreement with the books of accounts.

d) In our opinion, Balance Sheet, Profit & Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in section 211(3C) of the Companies Act 1956.

e) On the basis of the written representations received from the Directors, taken on record by the Board of Directors, and according to the information and explanations given to us, none of the directors is disqualified as on 31st March 2012 from being appointed as a Director under section 274(1) (g) of the Companies Act, 1956.

f) During the year under audit the Company has disposed off its entire investment at cost in subsidiary Navneet Machine Manufacturing Co. Ltd and hence the same become cease as subsidiary and accordingly the financial results of that erstwhile subsidiary company has not been incorporated for the year and as such no consolidated financial statement has been prepared and presented (Refer Note No. 35.)

g) During the year under audit, the company has discontinued its operations other than packaging Industries i.e. chemical divisions Chikalthana and Nandrabad being units activities were suspended for more than twelve years and also the business of Garments division as there is no synergy with main activity. (Refer Note No. 30.)

h) The profit on sale of fixed assets of discontinued chemical division amounting to Rs. 130.12 Lacs Net of loss of Rs. 4.01 Lacs has been disclosed as an extra ordinary item on the face of financial statement. (Refer Note no. 30 and 34) The profit and loss of Discontinued Garment division has not been separately shown on the face of the financial statement According to the information and explanations given by the management the turnover of this division is of Rs. 9.47 Lacs for the year which is not material and no hence no attempt is made to disclose as separate item. (Refer Note no. 31)

i) The outstanding balances of debtors, creditors, loans and advances (taken and given), balances with various statutory/fiscal liabilities (Assets & Liabilities) i.e. Excise deposits/balances, VAT(Sales Tax), CST, TDS/TCS are subject to confirmations, reconciliation's and consequent adjustment, if any. (Refer Note No. 40.)

3) In our opinion Subject to what is stated in point no. h and i of paragraph 2 above, and to the best of our information and according to the explanations given to us, the said financial statements read together with the Significant Accounting Policies and Notes to Accounts and in particular Note no. 36 regarding contingent liability, Note no. 37 regarding un implemented portion of BIFR's Sanctioned scheme and Note no. 9 regarding balances etc with Micro, Small and Medium enterprises respectively (for details refer said notes) give the information required by the Companies Act, 1956, in the manner so required and present a true and fair view in conformity with the accounting principals generally accepted in India:

a. In the case of the Balance Sheet of the State of affairs of the Company as at 31st March, 2012 and

b. In the case of Profit and Loss Account, of the "Loss" for the year ended on that date.

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

ANNEXURE TO THE AUDITORS' REPORT REFERRED TO IN PARAGRAPH 4 OF OUR REPORT OF EVEN PATE OF APT PACKAGING LIMITED

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

b. Some of the fixed assets are physically verified during the year by the management in accordance with a programme of verification, which in our opinion provides for physical verification of all the fixes assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

c. During the year, the Company has disposed off its entire assets (freehold land, building, Plant and Machinery etc.) of waterproofing and emulsified anfo/emulsion matrix division situated at Nandrabad Dist Aurangabad as well as the Plant & Machinery of ammonium nitrate division situated at Chikalthana, Aurangabad both known as chemical division. According to information and explanations given by the management that the operations of the said divisions were. suspended for more than twelve years, the chemical division was demerged in consideration of the sanctioned scheme by the BIFR, the business activities pertains to the these divisions are discontinued and to concentrate on main activity of the company it disposed off the assets.

In view of above, we are of the opinion that the disposal off of the said fixed asset does not affect the overall going concern status of the company.

2) a. As informed to us, the stock of finished goods, work-in-process and raw materials at all the units of the Company have been physically verified by the Management once in a year except for the goods lying with the third parties. In our opinion, It should be conducted at least twice a year.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of stock followed by the management are reasonable and adequate in relation the size of Company and the nature of its business.

c. On the basis of our examination of the records of inventory, we are of the opinion that the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account.

3) a. The Company has taken loans from three directors, six shareholders, two relatives of the director, two promoters Group Company and Resulting Company covered in the register maintained under Section 301 of the Companies Act, 1956 to meet the short fall of Sanctioned Scheme and as per banker's clause. The maximum amount involved during the year is Rs. 777.42 lacs and the year end balance of loans taken from such parties was Rs. 777.42 lacs.

b. The company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

c. According to the information and explanation given to us, out of the above loan amount of Rs. 105.08 Lacs is Interest free and balance Rs. 672.34 Lacs is interest bearing. For interest bearing unsecured loans the interest is provided. The said loan is repayable on demand subject to prior permission of Punjab National Bank as per banker's clause. The terms and conditions of these loans are not prejudicial to the interests of the company. d. The company is regular in repaying the loan amount and interest whenever applicable and as stipulated.

4) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

5) a. According to the information and explanation given to us, we are of the opinion that the transaction that needs to be entered in to the register maintained u/s 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanation given to us, there are no such transactions exceeding Rs. 5 Lacs each which have been made at prices, which are not reasonable having regard to the prevailing market prices, for such goods, materials or services at the relevant time.

6) The Company has not accepted any deposits from the public within the provisions of section 58A and 58AA of the Companies Act, 1956 and rules framed there under.

7) in our opinion, the company has an adequate Internal Audit system commensurate with its size and the nature of its business

8) According to the information and explanations given to us, no cost records have been prescribed under section 209(1) (d) of the Companies Act, 1956 for any of its products.

9) a. According to the records of the company, the company is generally regular in depositing with the appropriate authorities undisputed statutory dues including P.F., customs, excise duty, income tax, sales tax, investors education and protection fund, Service Tax, Custom Duty Cess and other material statutory dues applicable except Rs. 42.72 Lacs.

The statements of Arrears of Statutory dues outstanding for more than six months are as follows:

TYPE OF TAXES AMOUNT IN LACS

Sales Tax 40.38

Property Tax 2.25

TDS 00.09

b. As at 31st March 2012 according to the records of the company, the following are the particulars of disputed- dues on Account on Sales Tax have not been deposited:

Name of Statute Disputed Forum where dispute is pending Liability Rs. In Lacs

Sales Tax Govt. of 1.52 Sales Tax Authority, Aurangabad. Maharashtra

10) During the financial year the company has been discharged as Sick Company by The Board of Industrial and Financial Restructuring(BIFR) vide its order dated 16th June 2011 on companies net worth becoming positive as on 31.03.2011. The company has accumulated losses exceeding more than 50% of its net worth as on March 31, 2012. The Company has suffered cash losses amounting to Rs. 59.50 Lacs during the financial year covered by our audit and there was a cash loss in the financial year immediately preceding current financial year amounting to Rs. 18.77 Lacs.

11) Based on our audit procedures and on the information and explanations given by the management, the company has delayed repayment of loans to banks in respect of term loans. The following are the delays.

Particulars Amount in Lacs Period of delays

Term Loans 416.60 Up to 60 days.

As at the year end, these delays have been rectified and hence no delays exist as at March 31, 2012.

12) According to the information and explanations given to us and records of the company, the company has not granted any loans and advances on the basis of securities by way of pledge of shares, debentures and securities. According to the provisions of clause 4(xii) of the Companies (Auditors Report) order, 2003 the same are not applicable to the Company.

13) In our opinion, the company is not a Chit Fund or a Nidhi/Mutual benefit fund/Society. Accordingly, the provisions of clause 4 (xiii) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

14) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other instruments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

15) In accordance with the sanctioned scheme of Demerger and the order of Honorable BIFR, for resulting company, the company has given Guarantees to banks and other creditors for their respective outstanding balances as on cutoff date i.e. 01.04.2007 incase if the resulting company fails to pay or shortfall to pay the same. As this is stipulated as per the Sanctioned Scheme ordered by the BIFR, the same is not treated as prejudicial to the interest of the company. According to information and explanations given to us by the management there is outstanding balance of Rs. 399.36 lacs as on 31.03.2012 on account of Sales tax deferral.

16) According to the records of the Company, information and explanation given to us, the company has obtained term loans during the year under audit and the same were applied for the purpose for which they are raised.

17) According to the information and explanations given to us and on overall examination of the balance sheet of the - company, we are of the opinion that the Company has used no funds raised on short-term basis for long-term investment except permanent working capital.

18) During the year, the company has not made any allotment of shares, hence the provisions of clause 4(xviii) of the Companies (Auditors Report) order, 2003 are not applicable to the company.

19) According to the records of the Company, the company has not issued any debentures as per the provisions under clause 4(xix) of the Companies (Auditors Report) order, 2003.

20) The company has not raised any money by Public-issues during the period covered by our Audit report as per the provisions under clause 4(xx) of the Companies (Auditors Report) order, 2003.

21) During the course of our examination of the books records of the company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have been informed of such case by the management.



For Rathi & Bangad Chartered Accountants (Firm Reg. No. 108702W)

Dilip O. Jain Proprietor M. No. 044301

Date: 13/08/2012 Place: Aurangabad

---

Mar 31, 2011

We have audited the attached Balance Sheet of APT PACKAGING LIMITED as at 31st March 2011, the Profit & Loss Account of the Company and the Cash Flow Statement for the year ended on that date (together referred to as "Financial statement"). These financial statements are the responsibility of the Company's management. Our responsibility is to express opinion on these financial statements based on our audit.

We have conducted our audit in accordance with the auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes, examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

In accordance with the provisions of the Companies Act, 1956, we report that:

1) As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, and on the basis of test checks of the books and the records of the company and according to the information and explanations given to us, we annexed hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2) Further to our comments in the Annexure referred to above, we report that:

a) Subject to what is stated at point no. ‘f' below, we have obtained all the information and explanation, which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion, proper books of accounts as required by Law have been kept by the company as far as appears from our examination of these books.

c) The Balance Sheet and Profit & Loss Account referred to in this report are in agreement with the books of accounts.

d) In our opinion, Balance Sheet, Profit & Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in section 211(3C) of the Companies Act 1956.

e) On the basis of the written representations received from the Directors, taken on record by the Board of Directors, and according to the information and explanations given to us, none of the directors is disqualified as on 31st March 2011 from being appointed as a Director under section 274(1) (g) of the Companies Act, 1956.

f) The outstanding balances of debtors, creditors, loans and advances(taken and given), balances with various statutory / fiscal liabilities ( Assets & Liabilities) i.e. Excise deposits / balances, VAT( Sales Tax),CST, TDS / TCS are subject to confirmations, reconciliation's and consequent adjustment, if any. (Refer Note No. 14 in schedule13. )

3) In our opinion Subject to what is stated in point no. f of paragraph 2 above, and to the best of our information and according to the explanations given to us, the said financial statements read together with the Significant Accounting Policies and Notes to Accounts and in particular Note no. 6 regarding contingent liability, Note no.7 regarding unimplemented portion of BIFR's Sanctioned scheme and Note 12 regarding balances etc with Micro, Small and Medium enterprises respectively (for details refer said notes in Schedule 13) give the information required by the Companies Act, 1956, in the manner so required and present a true and fair view in conformity with the accounting principals generally accepted in India:

a. In the case of the Balance Sheet of the State of affairs of the Company as at 31st March, 2011 and

b. In the case of Profit and Loss Account, of the "Loss" for the year ended on that date.

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

ANNEXURE TO THE AUDITORS' REPORT_REFERRED TO IN PARAGRAPH 4 OF OUR REPORT OF EVEN DATE OF APT PACKAGING LIMITED

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

b. Some of the fixed assets are physically verified during the year by the management in accordance with a programme of verification, which in our opinion provides for physical verification of all the fixes assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

c. The Fixed assets are disposed off by the company during the year do not form a substantial part thereof.

2) a. As informed to us, the stock of finished goods, work-in-process and raw materials at all the units of the Company have been physically verified by the Management once in a year except for the goods lying with the third parties. In our opinion, it should be conducted at least twice a year.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of stock followed by the management are reasonable and adequate in relation the size of Company and the nature of its business.

c. On the basis of our examination of the records of inventory, we are of the opinion that the company is maintaining proper records of inventory. The discrepancies noticed on physical verification of stocks as compared to book records were not material and have been properly dealt with in the books of account.

3) a. The Company has taken loans from two directors, seven Shareholders, Four relatives of the Director, two promoters Group Company and Resulting Company covered in the register maintained under Section 301 of the Companies Act, 1956 to meet the short fall of Sanctioned Scheme. The maximum amount involved during the year is Rs. 792.72 Lacs including opening balance of Rs. 491.72 and the year end balance of loans Rs.474.04 Lacs.

b. According to the information and explanation given to us, out of the above loan amount of Rs. 360.45 Lacs is Interest free and balance Rs.432.27 is interest bearing. Out of interest free loan amount Rs. 360.45 Lacs, Rs 250.00 Lacs was converted into equity shares during the year. Hence with respect to amount of Rs. 250.00 Lacs, reasonable steps for the repayment do not arise. For interest bearing unsecured loans the interest is provided. The terms and conditions of these loans are not prejudicial to the interests of the company. The company is regular in repaying the loan amount and interest whenever applicable and as stipulated.

c. The Company had given unsecured loans of Rs. 1.11 Lacs to its wholly owned subsidiary. The same is interest free and long term. Therefore there is no overdue amount.

4) In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system.

5) a. According to the information and explanation given to us, we are of the opinion that the transaction that needs to be entered in to the register maintained u/s 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanation given to us, there are no such transactions exceeding Rs.5 Lacs each which have been made at prices, which are not reasonable having regard to the prevailing market prices, for such goods, materials or services at the relevant time.

6) The Company has not accepted any deposits from the public within the provisions of section 58A and 58AA of the Companies Act, 1956 and rules framed there under.

7) In our opinion, the company has an adequate Internal Audit system commensurate with its size and the nature of its business.

8) According to the information and explanations given to us, no cost records have been prescribed under section 209(1) (d) of the Companies Act, 1956 for any of its products.

9) a. According to the records of the company, the company is generally regular in depositing with the appropriate authorities undisputed statutory dues including P.F., customs, excise duty, income tax, sales tax, investors education and protection fund, Service Tax, Custom Duty Cess and other material statutory dues applicable except Rs.30.25 lacs. The statements of Arrears of Statutory dues outstanding for more than six months are as follows:

TYPE OF TAXES AMOUNT IN LACS

Sales Tax 16.31

Property Tax 13.85

TDS 00.09

b. As at 31st March 2011 according to the records of the company, the following are the particulars of disputed dues on Account on Sales Tax have not been deposited:

Name of Statute Disputed Liability Forum where dispute is Rs. In Lacs pending

Sales Tax Govt. 1.52 Sales Tax Authority, of Maharashtra Aurangabad.

10) The company has already been declared as Sick Company by Board of Industrial and Financial Restructuring vide its order dated 17th December 2002 within the meaning of clause (o) of Sub-section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985(i.e.SICA) and also sanctioned the scheme on 15/11/2007. The Company has suffered cash loss in current financial year but not in immediately preceding financial year. However the company has been discharged from the perview of SICA by the Hon'ble BIFR vide its order dated 16-06-2011

11) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to a financial institution or bank.

12) According to the information and explanations given to us and records of the company, the company has not granted any loans and advances on the basis of securities by way of pledge of shares, debentures and securities. According to the provisions of clause 4(xii) of the Companies (Auditors Report) order, 2003 the same are not applicable to the Company.

13) In our opinion, the company is not a Chit Fund or a Nidhi / Mutual benefit fund/Society. Accordingly, the provisions of clause 4 (xiii) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

14) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other instruments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) order, 2003 are not applicable to the Company.

15) In accordance with the sanctioned scheme of Demerger and the order of Honorable BIFR, for resulting company, the company has given Guarantees to banks and other creditors for their respective outstanding balances as on cut off date i.e. 01.04.2007 incase if the resulting company fails to pay or shortfall to pay the same . As this is stipulated as per the Sanctioned Scheme ordered by the BIFR, the same is not treated as prejudicial to the interest of the company. According to information and explanations given to us by the management there is outstanding balance of Rs. 399.96 lacs as on 31.03.2011 on account of Sales tax deferral.

16) According to the records of the Company, information and explanation given to us, the company has obtained term loans during the year under audit and the same were applied for the purpose for which they are raised.

17) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we are of the opinion that the Company has used no funds raised on short-term basis for long-term investment except permanent working capital.

18) During the year, the company has made preferential allotment of 25,00,000 equity shares of Rs.10/- each for cash at par to the promoters and promoter group company with lock-in-period of 3 years in accordance with the Sanctioned Scheme by Hon'ble BIFR. As this is stipulated as per the Sanctioned Scheme ordered by the BIFR, the same is not treated as prejudicial to the interest of the company.

19) According to the records of the Company, the company has not issued any debentures as per the provisions under clause 4(xix) of the Companies (Auditors Report) order, 2003.

20) The company has not raised any money by Public-issues during the period covered by our Audit report as per the provisions under clause 4(xx) of the Companies (Auditors Report) order, 2003.

21) During the course of our examination of the books records of the company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year, nor have been informed of such case by the management.

For Rathi & Bangad Chartered Accountants [Firm Reg. No .108702W]

Dilip D.Jain Proprietor M.No. 044301

Date : 31/08/2011 Place : Aurangabad