1.  We have audited the attached Balance Sheet of AIMCO PESTICIDES
 LIMITED as at 30th September 2012, the related Statement of Profit and
 Loss and the Cash Flow Statement of the Company for the 18 month period
 1st April 2011 to 30th September 2012 annexed thereto. These financial
 statements are the responsibility of the Company''s management. Our
 responsibility is to express an opinion on these financial statements
 based on our audit.
 
 2.  We conducted our audit in accordance with auditing standards
 generally accepted in India. Those Standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free of material misstatements. An audit
 includes examining, on a test basis, evidence supporting the amounts
 and disclosures in financial statements. An audit also includes
 assessing the accounting principles used and significant estimates made
 by management, as well as evaluating the overall financial statement
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 3.  As required by the Companies (Auditor''s Report) Order, 2003, issued
 by the Central Government in terms of Section 227(4A) of the Companies
 Act, 1956, and on the basis of such checks as considered appropriate
 and according to the information and explanations given to us during
 the course of the audit, we enclose in the Annexure hereto a statement
 on the matters specified in Paragraphs 4 and 5 of the said Order.
 
 4.  Further to our comments in the Annexure referred to in above
 paragraph, we report that:
 
 a) We have obtained all the information and explanations except as
 mentioned in f(i) and f(ii), 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 as required by law have been
 kept by the Company so far as appears from our examination of the books
 of the Company;
 
 c) The Balance Sheet, the Statement of Profit and Loss and the Cash
 Flow Statement dealt with by the report are in agreement with the books
 of account of the Company;
 
 d) In our opinion, the Balance Sheet, the Statement of Profit and Loss
 and the Cash Flow Statement comply with the mandatory Accounting
 Standards referred to in Section 211 (3C) of the Companies Act, 1956
 except for non-compliance with Accounting Standard on Valuation of
 Inventories (AS 2) as referred to in para 4 f(vi) below;
 
 e) On the basis of written representations received from the directors
 of the Company as on 30th September 2012, and taken on record by the
 Board of Directors, we report that none of the directors is
 disqualified as on 30th September 2012, from being appointed as a
 director in terms of Section 274(1)(g) of the Companies Act, 1956;
 
 f(i) The Company has not obtained confirmations for balances from trade
 receivables, trade payables and advances. The balances are therefore as
 per the books and subject to reconciliations and write-offs or write
 back, if any. Our audit report on the financial statements for the year
 ended 31st March, 2011 was also modified accordingly;
 
 f(ii) The Company has provided interest on Term Loans, Cash Credit and
 other facilities, except on Funded Interest Term Loan of Rs. 40,100,000
 [See f(iv) below] on an estimated basis. The same is subject to
 confirmation of a bank and consequent reconciliations and write-offs or
 write back, if any. Our audit report on the financial statements for
 the year ended 31st March, 2011 was also modified accordingly;
 
 f(iii) No provision is made for debtors outstanding for more than three
 years which are doubtful of recovery Rs. 16,26,71,469. Our audit report
 on the financial statements for the year ended 31st March, 2011 was
 also modified accordingly;
 
 f(iv) No provision is made for interest payable on Funded Interest Term
 Loan which is estimated at Rs.1,85,10,221 including Rs. 1,02,54,903 in
 respect of the earlier years (Refer Note 10 of the Financial
 Statements);
 
 f(v) No provision is made for advances of Rs. 62,63,066 paid to various
 vendors in earlier years which are doubtful of recovery;
 
 f(vi) Inventory amounting to Rs. 4,68,92,790 has been valued at cost and
 not at lower of cost or net realizable value as required by Accounting
 Standard on Valuation of Inventories (AS 2).
 
 f(vii) The Company has paid remuneration to directors and ex- director
 and commission to ex - director for the various periods, for which the
 Company has yet to receive approval of the Central Government u/s 309
 of the Companies Act, 1956. (Refer Note 27.5 of the Financial
 Statements). Our audit report on the financial statements for the year
 ended 31st March, 2011 was also modified accordingly;
 
 f(viii) The Company does not have a whole-time secretary as required
 under section 383A of the Companies Act, 1956; Our audit report on the
 financial statements for the year ended 31st March, 2011 was also
 modified accordingly;
 
 f(ix) Attention is drawn to Note 27.2 of the Financial Statements
 regarding the Accounts being drawn on going concern basis.
 
 g) We further report that without considering items f(i), f(ii), f(vi),
 f(vii), f(viii) and f(ix) above the effect of which is not possible to
 quantify, had the observations made by us in f(iii), f(iv)and f(v)
 considered, the loss for the 18 months period would have been Rs.
 26,35,50,204 (as against the reported loss of Rs. 8,63,60,352), the
 accumulated losses would have been Rs. 43,66,29,273 (as against the
 reported figure of Rs. 24,91,84,517), interest accrued and due would have
 been Rs. 13,83,11,572 (as against the reported figure of Rs. 11,98,01,351),
 long term trade receivables would have been Nil (as against the
 reported figure of Rs. 16,26,71,469) and advance to suppliers would have
 been Rs.1,11,47,327 (as against reported figure of Rs. 1,74,10,393).
 
 h) In our opinion and to the best of our information and according to
 the explanations given to us, the said accounts read with Notes to
 Accounts in the Financial Statements give the information required by
 the Companies Act, 1956 in the manner so required and subject to f(i)
 to f(viii) above and its impact on the loss for the 18 months period
 and on certain assets and liabilities as per (g) above, give a true and
 fair view in conformity with the accounting principles generally
 accepted in India:
 
 a.  In the case of the Balance Sheet, of the state of affairs of the
 Company as at 30th September 2012;
 
 b.  In the case of the Statement of Profit and Loss, of the loss for
 the 18 month period 1st April 2011 to 30th September 2012 ;
 
 c.  In the case of the Cash Flow Statement, of the cash flows of the
 Company for the 18 months ended on 30th September, 2012.
 
 Statement referred to in paragraph 3 of the Auditors'' Report of even
 date to the Members of AIMCO PESTICIDES LIMITED on the accounts for the
 18 months ended 30th September, 2012.
 
 On the basis of such checks as considered appropriate and in terms of
 the information and explanations given to us, we state as under:
 
 1(a) The Company is maintaining proper records showing full particulars
 including quantitative details and situation of the fixed assets.
 
 1(b) As per the information and explanations given to us, the
 management at reasonable intervals carries out the physical
 verification of the fixed assets. The discrepancies noticed on such
 verification, which were not material, have been appropriately dealt
 with in the accounts.
 
 1(c) The fixed assets disposed of during the year do not constitute
 substantial part of the fixed assets.
 
 2(a) As per the information furnished, the inventories (except
 work-in-progress, goods-in-transit and stock lying with third parties,
 confirmations for which have been obtained) have been physically
 verified during the year by the management. In our opinion, having
 regard to the nature and location of stocks, the frequency of the
 physical verification needs to be increased;
 
 2(b) In our opinion and according to the information and explanations
 given to us, procedures of physical verification of inventory followed
 by the management should be enhanced to cover entire inventory of the
 Company and at more frequent intervals;
 
 2(c) The Company is maintaining proper records of inventory. In our
 opinion, discrepancies noticed on physical verification of stocks were
 not material in relation to the operations of the Company and the same
 have been properly dealt with in the books of account.
 
 3(a) As per the information and explanations given to us, the Company
 has in earlier years paid deposit to a party covered in the register
 maintained under section 301 of the Companies Act, 1956. The balance
 outstanding as at 30th September 2012 and the maximum amount
 outstanding during the period was Rs. 70,02,068. (Also refer Note 14(i)
 in the Financial Statements).
 
 3(b) In case of the aforesaid deposit the terms and conditions are not
 prima-facie prejudicial to the interests of the Company.  3(c) In case
 of the aforesaid deposit, the same is repayable on surrender of leased
 premises.  3(d) In case of the aforesaid deposit, since there is no
 default by the party, the question of taking reasonable steps for the
 recovery of the principal amount does not arise.  3(e) As per the
 information and explanations given to us, the Company has taken
 unsecured loans from seven parties covered in the register maintained
 under section 301 of the Companies Act, 1956. 
 
 The balance outstanding as at 30th September, 2012 from the parties was
 Rs. 87,67,774 and the maximum amount outstanding during the period was Rs.
 1,64, 16,841.
 
 3(f) In case of the aforesaid unsecured loans taken from parties
 covered in the register maintained under Section 301 of the Companies
 Act, 1956, the terms and conditions are not prima-facie prejudicial to
 the interests of the Company.  3(g) In case of the aforesaid unsecured
 loan taken from parties covered in the register maintained under
 Section 301 of the Companies Act, 1956, the loan is repayable on
 demand.
 
 4 In our opinion and as explained 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 and fixed
 assets and for the sale of goods. During the course of our audit, no
 major weakness has been noticed in the internal controls and there is
 no continuing failure for the same.
 
 5(a) Based on the audit procedures applied by us and according to the
 information and explanations provided by the management, we are of the
 opinion that the Company has not entered into any transactions which
 needs to be entered in the register maintained under section 301 of the
 Companies Act, 1956.  5(b) As referred to above, since there are no
 transactions the particulars of which are required to be entered in the
 register maintained under section 301 of the Act, the clause regarding
 reasonableness or otherwise of such transaction is not applicable.
 
 6 In our opinion and according to the explanations given to us, the
 Company has not complied with the provisions of Section 58A and 58AA or
 any other relevant provision of the Companies Act, 1956 and rules made
 there under in so far as that: (i) its Net Owned Fund as at the
 beginning of the year is below Rs. 1 crore and hence, it is not permitted
 to accept / renew deposits under rule 3(i)(e); (ii) Deposits from the
 shareholders exceed the limit of 10% prescribed in Rule 3(2)(i); and
 (iii) Deposits from general public exceed the limit of 25% prescribed
 in Rule 3(2)(ii) . According to the information and explanation given
 to us, no order has been passed by the Company Law Board or National
 Company Law Tribunal or Reserve Bank of India or any other Tribunal on
 the Company in respect of the aforesaid deposits.
 
 7 The Company has appointed a firm of Chartered Accountants to conduct
 the internal audit. In our opinion, the internal audit needs to be
 further strengthened and scope thereof widened in order to cover
 additional areas and make it commensurate with the size and nature of
 business and the activities of the Company.
 
 8 On the basis of the records produced, we are of the opinion that
 prima facie, the cost records and accounts prescribed by the Government
 of India under section 209(1)(d) of the Act have been made and
 maintained by the Company. However, we are not required to carry out
 and have not carried out any detailed examination of such records and
 accounts.
 
 9(a) According to the information and explanations given to us and the
 records examined by us, there is a delay by the Company in depositing
 with the appropriate authorities undisputed statutory dues on account
 of income-tax, sales-tax, wealth-tax, service tax and other statutory
 dues. According to the information and explanations given to us,
 following undisputed arrears of statutory dues were outstanding as at
 30th September 2012, for a period of more than six months from the date
 they became payable.
 
 Nature of the    
 Statute              Nature of the 
                      Dues                Amount (Rs.)     Period to 
                                                           which
                                                           amount 
                                                           relates
 
 Profession 
 Tax Act              Profession Tax         76,035        2006-07
 
 Service Tax Act      Service Tax         4, 95,892        2007-08
 
 Service Tax Act      Service Tax         2, 44,230        2011-12
 
 Income Tax Act       Income tax      1, 15, 15,000        1998-99
 
 Income Tax Act       Tax deducted 
                      at Source           1, 34,640        2005-06
 
 Income Tax Act       Tax deducted 
                      at Source           3, 51,202        2006-07
 
 Income Tax Act       Tax deducted 
                      at Source           1, 60,512        2007-08
 
 Income Tax Act       Tax deducted at
                      Source              1, 68,838        2008-09
 
 Income Tax Act       Fringe Benefit Tax  6, 22,645        2006-07
 
 Income Tax Act       Fringe Benefit Tax  3, 84,256        2007-08
 
 Income Tax Act       Fringe Benefit Tax  4, 34,285        2008-09
 
 9(b) According to the records of the Company, there are no dues of
 Income Tax, sales tax, wealth-tax, service tax, custom duty, excise
 duty, cess which have not been deposited on account of disputes.
 
 10 The Company has accumulated losses as on 30th September 2012 which
 are more than fifty percentage of the net worth of the Company. The
 Company has incurred cash losses during the financial year as well as
 in the preceding year.
 
 11 Based on our audit procedures and the information and explanations
 given by the management, the Company has defaulted in repayment of dues
 to a bank during the year. The details of dues which were unpaid till
 30th September, 2012 are as under:
 
 Name                  Amount (Rs.)   Overdue period
 
 State Bank of 
 India (Principal)     187,069,356    Various dates from 1st
                                      April, 2007 to 31st March, 2012
 
 State Bank of 
 India (Interest)      113,675,600    Various dates from 30th
                                      September, 2007 to 30th 
                                      September, 2012
 
 
 
 
 12 Based on our examination of the records and the information and
 explanations given to us, the Company has not granted any loans and/or
 advances on the basis of security by way of pledge of shares,
 debentures and other securities.
 
 13 Clause (xiii) of the Order is not applicable to the Company as the
 Company is not a Chit fund Company or nidhi/mutual benefit
 fund/society.
 
 14 During the year, the Company has no transactions in respect of
 dealing and trading in shares, securities, debentures and other
 investments. The Company does not hold any investment in shares,
 debentures or other securities.
 
 15 According to the information and explanations given to us, the
 Company has not given any guarantees for loans taken by others from
 bank or financial institutions.
 
 16 According to the information and explanations given to us, no term
 loan is raised during the year and the term loans raised during the
 earlier years were used for the purpose for which it was raised.
 
 17 Based on our examination of the Balance Sheet of the Company as at
 30th September 2012, we report that no funds raised on short term basis
 have been used for long term investment except for funds raised from a
 bank and public deposits aggregating to Rs. 10,31,09,356 which have been
 used for funding of accumulated losses.
 
 18 The Company has not made any preferential allotment of shares during
 the year.
 
 19 During the year covered by our audit the Company has not issued any
 secured debentures.
 
 20 The Company has not raised any money by public issues during the
 year covered by our report.
 
 21 As per the information and explanations given to us, no fraud on or
 by the Company has been noticed or reported during the year.
 
                                  For and on behalf of
 
                                  Contractor Nayak & Kishnadwala
 
                                  Chartered Accountants 
 
                                 (Firm Regn. No. 101961W)
 
                                  H. V. Kishnadwala
 
                                  Partner 
 
                                  Membership No. 37391 
 
 Mumbai, November 30, 2012