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Auditor Report of Birla Cotsyn (India) Ltd.
Mar 31, 2015
We have audited the accompanying standalone financial statements of
BIRLA COTSYN (INDIA) LIMITED ("the Company") which comprise the Balance
Sheet as at 31st M arch, 2015, the Statement of Profit and Loss and
Cash Flow Statement for the year then ended and a summary of
significant accounting policies and other explanatory information.
Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation and presentation of these standalone financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the accounting principles generally accepted in India, including the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility
includes maintenance of adequate accounting records in accordance with
the provisions of the Act for safeguarding 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 statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company's Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our qualified audit opinion on the
standalone financial statements.
Basis for Qualified Opinion
1. With reference to note no. 7(B)(b) regarding inter corporate
deposits of Rs. 17,96,88,787/- taken from various parties as at 31st
March, 2015 in the absence of third party confirmation, reconciliation,
if any and other supportive audit evidence, we are unable to comment
upon such balances.
Further, few such parties have already filed winding up petition under
section 271 and 272 of the Companies Act, 2013 ("the Act") against the
Company for non-payment of dues (Section 433 & 434 of the Companies
Act, 1956). These matters are sub- judice and the impact, if any, of
the outcome is unascertainable of this stage.
2. With reference to note no. 7(B)(c) regarding dues to related
parties of Rs. 9,15,49,878/- and note no. 8(A)(a) trade payables of Rs.
22,69,36,818/- as at 31st March, 2015, in the absence of third party
confirmation, reconciliation, if any and other supportive audit
evidence, we are unable to comment upon such balances.
3. No provision has been made in the current year for interest payable
of Rs.37,73,961/- on loans taken from related parties by the Company
and no provision has been made for interest receivable of
Rs.1,89,20,004/- on loans given to related parties by the Company.
Consequently the loss for the year is higher by Rs.1,51,46,043/-, Other
Current Liabilities (Note No 8) is understated by Rs.37,73,961/- and
Other Non-Current Assets (Note 13) is understated by Rs.1,89,20,004/-.
4. With reference to Fixed Deposits accepted by the Company, the
Company has defaulted in repayment of dues of Rs. 4,33,29,363/- as at
31st March, 2015. However, on Company's petition / application under
section 58A(9) of the Companies Act, 1956, the Hon'ble Company Law
Board has passed an order dated 19th May, 2015 for rescheduling the
repayment of the deposits for a specified period under section 58A(9)
read with section 74(2) of the Companies Act, 2013.
5. With reference to note no 12(a) regarding capital advances of
Rs.94,55,65,044/- as at 31st March, 2015 given to various parties, the
Company has made a provision of Rs.94,32,23,851/-given to various
equipment suppliers and other parties mainly towards implementing
Weaving Project. The amount represents balances outstanding for more
than five years in respect of projects of the Company which have not
taken off. In the absence of third party confirmation, reconciliation,
if any and other supportive audit evidence, we are unable to comment
upon its recoverability in cash or kind, if any.
6. With reference to note no. 17(a) regarding loan of Rs.7,29,98,404/-
given to one related party, which has incurred losses and also has
negative net worth as at 31st March 2013, in the absence of latest
audited accounts and detailed information of projected cash flows as at
31 March, 2015 or other supportive audit evidence, we are unable to
comment upon its impairment, if any. With reference to note no.12(d)
regarding loans given to other related parties of Rs.33,89,08,208/- as
at 31st March, 2015, in the absence of third party confirmation,
reconciliation if any and other supportive audit evidence, we are
unable to comment upon such balances
7. With reference to note no. 10(D) regarding Plant & Machinery of Rs.
Rs.37,35,48,883/- situated at one factory unit of the company has been
generally operating at lower capacity. In the absence of future cash
flow projection and information about the value in use, we are unable
to comment upon its impairment provision, if any as per Accounting
Standard 28 "Impairment of Assets".
Qualified Opinion
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 above and read
with points mentioned in Emphasis of Matter paragraph, the aforesaid
financial statements give the information required by the Act in the
manner so required and give a true and fair view in conformity with the
accounting principles generally accepted in India, of the state of
affairs of the Company as at 31st March, 2015, and its loss and its
cash flows for the year ended on that date.
Emphasis of Matter
1. We draw attention to the Note no. 3(e) in the financial Statements.
The company has incurred net loss of Rs.1,64,41,10,595/- during the
year ended 31st March, 2015 and as of that date, the Company's
accumulated losses aggregate to Rs.345,55,84,162/- resulting in
complete erosion of its net worth. Further, as of that date, company's
current liabilities exceeded its current assets by Rs.3,91,88,56,757/-
subject to the effects of matters described in the Basis for Qualified
Opinion paragraph. These factors along with other matters as set forth
in said note raise substantial doubt about the company's ability to
continue as a going concern in the foreseeable future. However, the
company's financial statement has been prepared on going concern basis
as disclosed by management in said note. Our opinion is not qualified
in respect of this matter.
2. We draw attention to Note no. 4A and 4B regarding notice issued by
consortium of banks under section 13(2) of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security Interest
(SARFAESI) Act 2002 for non-payment of principal and interest thereon
after the due date by the company and therefore all loans accounts
became Non Performing Assets effective from respective dates mentioned
in such notice. We are informed that the company is contesting the
action taken under section 13(4) of SARFAESI Act and therefore the
matter is sub-judice. These factors along with other matters as set
forth in said notice raise substantial doubt about the company's
ability to continue as a going concern in the foreseeable future.
However, the company's financial statements have been prepared on going
concern basis as disclosed by management in said note. Our opinion is
not qualified in respect of this matter.
Other Matters
The company had given loan to three related parties in earlier years
and the amount outstanding as at 31st March, 2015 Rs.44,47,33,111/-
(including interest till 31st March, 2015) which is not in compliance
with the requirements of section 185 of the Companies Act, 2013.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in Annexure a
statement on the matters Specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit except for the matter described in the Basis for
Qualified Opinion Paragraph.
(b) In our opinion, proper books of accounts 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, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
accounts.
(d) Except for the effects of the matters described in the Basis for
Qualified Opinion paragraph, and read with points mentioned in Emphasis
of Matter paragraph, in our opinion, the aforesaid standalone financial
statements comply with the Accounting Standards specified under Section
133 of the Act, read with Rule 7 of the Companies (Accounts) Rules,
2014.
(e) On the basis of written representations received from the directors
as on 31st March, 2015 taken on the record by the Board of Directors,
none of the director is disqualified as on 31st March, 2015 from being
appointed as a director in terms of Section 164(2) of the Act.
(f) 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 financial statements- Refer Note 26 to the
financial statements;
II. The Company does not have any long term contracts including
derivative contracts; as such the question of commenting on any
material foreseeable losses does not arise
III. There has not been an occasion in case of the Company during the
year under report to transfer any sums to the Investor Education and
Protection Fund. The question of delay in transferring such sums does
not arise.
ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT
1 Fixed Assets:
1.1 The Company has maintained proper records showing full particulars
including quantitative details and situation of fi xed assets.
1.2 The fi xed assets are physically verifi ed during the year by the
Management in accordance with a regular program of verifi cation which,
in our opinion is reasonable having regard to the size of the Company
and the nature of its assets. No material discrepancies were noticed on
such verifi cation by the management between the book and physical
verifi cation records.
2 Inventories:
2.1 As per the information given to us, inventory has been physically
verifi ed by the Management during the year. In our opinion, the
frequency of verifi cation is reasonable.
2.2 In our opinion and according to the information and explanations
given to us, the procedures of physical verifi cation of such inventory
followed by the Management are reasonable and adequate in relation to
the size of the Company and the nature of its business
2.3 In our opinion and according to the information and explanations
given to us, the Company is maintaining proper records of inventory and
no major discrepancies were noticed on physical verifi cation.
3 Loans borrowed or given:
3.1 According to information and explanations given to us the Company
has granted loans to three bodies corporate covered in the register
maintained under section 189 of the Companies Act, 2013.
3.2 In the case of the loans granted to the bodies corporate listed in
the register maintained under section 189 of the Act, since there are
no terms for repayment of interest we cannot comment upon the
regularity of the same. The terms of arrangements do not stipulate any
repayment schedule and the loans are repayable on demand. Accordingly,
paragraph 3(iii)(b) of the Order is not applicable to the Company in
respect of repayment of the principal amount.
3.3 There are no overdue amounts of more than rupees one lakh in
respect of the loans granted to the bodies corporate listed in the
register maintained under section 189 of the Companies Act, 2013.
4 Internal Control System:
4.1 In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchases of inventory and fi xed assets and for the sale of goods and
services.
4.2 As regards purchase of fi xed assets and capitalization of work in
progress, the Company needs to strengthen internal controls for keeping
proper identifi cation of Assets.
5 Deposit from Public:
5.1 The Company has defaulted in repayment of dues of Rs. 4,33,29,363/-
till 31st March, 2015. However, on Company's petition / application
under section 58A(9) of the Companies Act, 1956, the Hon'ble Company
Law Board has passed an order dated 19th May, 2015 for rescheduling the
repayment of the deposits for a specifi ed period under section 58A(9)
read with section 74(2) of the Companies Act, 2013.
6 Maintenance of Cost Records:
6.1 We have broadly reviewed the cost records maintained by the Company
pursuant to the Companies (Cost Records and Audit) Rules, 2014, as
amended, prescribed by the Central Government under sub-section (1) of
section 148 of the Companies Act, 2013, and are of the opinion that,
prima facie, the prescribed cost records have been made and maintained.
We have, however, not made a detailed examination of the cost records
with a view to determine whether they are accurate or complete.
7 Remittance of Statutory Dues:
7.1 Undisputed statutory dues including provident fund, investor
education and protection fund, employees state insurance, income-tax,
sales-tax, wealth-tax, service tax, customs duty, excise duty, cess
have not been regularly deposited with the appropriate authorities and
there has been signifi cant delay in the same.
7.2 According to the information and explanation given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees state insurance, income tax,
wealth tax, service tax, sales tax, custom duty, excise duty, cess and
other undisputed statutory dues were outstanding at the end, for the
period of more than six month from the date they became payable, except
as stated below
Name of the Nature of Dues Amount (Rs.) Period to which
Statute the
Amount relates
Income Tax Dividend
Distribution tax 1,93,32,677 2009-10
Income Tax TDS on Interest 20,68,460 2012-13
Income Tax TDS on FD Interest 2,76,279 2014-15
Name of the
Statute Due Date Date of
payment
Income Tax 04-10-2010 Not paid
Income Tax 01-04-2012 to Not Paid
31-12-2012
Income Tax 1-04-2014 to 30-09- Not Paid
2014
7.3 According to the information and explanations given to us and as
per the records of the Company examined by us, there are no dues
outstanding of sales tax, income tax, custom duty, wealth tax, service
tax, excise duty and cess, which have not been deposited on account of
any dispute.
7.4 The amounts required to be transferred to investor education and
protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made there under has been
transferred to such fund within time.
8 Accumulated Losses:
8.1 In our opinion, the accumulated losses of the company are more than
Fifty percent of its net worth. The Company has not incurred any cash
losses during the fi nancial year covered by our audit and in the
immediately preceding fi nancial year.
9 Dues to Bank and Financial Institutions
9.1 In our opinion, and according to the information and explanation
given to us, the Company has defaulted in repayment of dues to fi
nancial institutions and banks for principal amount of Rs.
232,43,04,243/- and interest amounting of Rs. 106,35,40,174/- since
May 2012. The Company has received notice issued by consortium of banks
under section 13(2) of the Securitization and Reconstruction of
Financial Assets and Enforcement of Security Interest Act 2002 for non-
payment of principal and interest thereon after the due date by the
Company and therefore all loans accounts became Non Performing Assets
effective from respective dates mentioned in such notice. We are
informed that the company is contesting the action taken under section
13(4) of SARFAESI Act and therefore the matter is sub-judice.
10 Guarantees given by the Division for Loans Taken by Others:
10.1 According to the information and explanations given to us and
records produced, the Company has not given any guarantee for loans
taken by others from banks or fi nancial institutions.
11 End Use of Term Loans raised:
11.1 The Company has not taken any term loans during the year under
audit. Hence the question of application of term loans for the purposes
for which they were obtained does not arise.
12 Frauds
12.1 During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India and according to the information and
explanation given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the period, nor
have been informed of any such case by the management.
For Samria & Co.,
Chartered Accountants
Firm Reg. No.: 109043W
(Adhar Samria)
Place: Mumbai Partner
Date : 29th May, 2015 M. No: 049174
Mar 31, 2014
We have audited the accompanying financial statements of Birla Cotsyn
(India) Limited (the Company), which comprise the Balance Sheet as at
31st March, 2014 and the statement of Profit and Loss and Cash Flow
Statement for the period then ended and a summary of significant
accounting policies and other explanatory information.
Management''s 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 flows of the Company in accordance with
the Accounting Standards notified under the Companies Act, 1956 (which
continues to be applicable in respect of Section 133 of the Companies
Act, 2013 in terms of General Circular 15/2013 dated 13th September,
2013 of the Ministry of Corporate Affairs) and in accordance with the
accounting principles 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 free from material
misstatement, whether due to fraud or error.
Auditor''s 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
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain 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 statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the Company''s
internal control. An audit also includes evaluating the appropriateness
of the accounting policies used and the reasonableness of the
accounting estimates 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 qualified opinion.
Basis for Qualified Opinion
1) With reference to note no. 8(b) regarding inter corporate deposits
of Rs.19,85,95,895/- taken from various parties as at 31 March, 2014 in
the absence of 3rd party confirmation, reconciliation, if any and other
supportive audit evidence, we are unable to comment upon such balances.
Further, few such parties have already filed winding up petition under
section 433 and 434 of the Companies Act, 1956 (''the act") against the
Company for non-payment of dues. These matters are sub-judice and the
impact, if any, of the outcome is unascertainable of this stage.
2) With reference to note no. 8(d) regarding dues to related parties of
Rs.9,29,69,145/- and note no. 9(a) trade payables of Rs.24,98,36,255/-
as at 31 March, 2014, in the absence of third party confirmation,
reconciliation, if any and other supportive audit evidence, we are
unable to comment upon such balances.
3) With reference to note no. 13(a) regarding capital advances of Rs.
98,02,26,844/- as at 31 March, 2014 given to various parties, in the
absence of third party confirmation, reconciliation, if any and other
supportive audit evidence, we are unable to comment upon its
recoverability in cash or kind, if any. The amounts represent balances
outstanding for more than 5 years in respect of projects of the Company
which have not taken off.
4) With reference to note no. 18(a) regarding loans of Rs.
7,29,98,404/- given to one related party, which has incurred losses and
also has negative net worth as at 31 March, 2013, in the absence of the
audited accounts and detailed information of projected cash flows as at
31 March, 2014 or other supportive audit evidence, we are unable to
comment upon its impairment, if any.
5) With reference to note no. 16(a) regarding trade receivable of
Rs.85,30,14,604/- as at 31 March, 2014, the company has made provision
for doubtful debts of Rs.84,85,36,833/-, including provision of
Rs.5,05,14,751/- for the current period. In the absence of third party
confirmation, reconciliation, if any and other supportive audit
evidence, we are unable to comment upon its balance recoverability, if
any.
6) With reference to note no. 11(4) regarding Plant & Machinery of Rs.
Rs.37,35,48,883/- situated at one factory unit of the company has been
generally operating at lower capacity. In the absence of future cash
flow projection and information about the value in use, we are unable
to comment upon its impairment provision, if any as per Accounting
Standard 28 "Impairment of Assets".
Qualified Opinion
In our opinion and to the best of our information and according to the
explanations given to us, subject to the effects of the matter
described in the Basis for Qualified Opinion paragraph and read with
points mentioned in Emphasis of Matter paragraph, the financial
statements give the information required by the Act in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2014;
(b) in the case of the statement of Profit and Loss, of the loss for
the period ended on that date; and
(c) in the case of the Cash Flow statement, of the cash flows for the
period ended on that date.
Emphasis of Matter
1. We draw attention to the note no. 3(e) in the financial Statements.
The company has incurred net loss of Rs.54,54,76,827/- during the
period ended 31st March, 2014 and, as of the date; the company''s
current liabilities exceeded its current assets by Rs.2,87,00,90,359/-
subject to the effects of matters described in the Basis for Qualified
Opinion paragraph. These factors along with other matters as set forth
in said note raise substantial doubt about the company''s ability to
continue as a going concern in the foreseeable future. However, the
company''s financial statement has been prepared on going concern basis
as disclosed by management in said note.
2. With reference to note no. 4(a) regarding notice issued by
consortium of banks under section 13(2) of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security Interest
(SARFAESI) Act 2002 for non-payment of installments and interest
thereon after the due date by the company and therefore all loans
accounts became Non Performing Assets with effective from respective
dates mentioned in such notice. We are informed that the company is
contesting the action taken under section 13(4) of SARFAESI Act and
therefore the matter is sub judice. These factors along with other
matters as set forth in said notice raise substantial doubt about the
company''s ability to continue as a going concern in the foreseeable
future. However, the company''s financial statements have been prepared
on going concern basis as disclosed by management in said note.
other Matters
The company had given loan to three related parties in earlier years
and the amount outstanding as at 31st March, 2014 Rs.42,02,79,268/-
(including interest till 31st March, 2014) which is not in compliance
with the requirements of section 295 of the Companies Act, 1956.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure, a
statement on the matters specified in paragraph 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of
audit except for the matter described in the Basis for Qualified
Opinion Paragraph;
b. in our opinion proper books of accounts as required by law have
been kept by the company so far as appears from our examination of
those books;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts;
d. except for the effects of the matters described in the Basis for
Qualified Opinion Paragraph, and read with points mentioned in emphasis
of Matter paragraph in our opinion, the Balance Sheet, Statement of
Profit and Loss and Cash Flow Statement comply with the Accounting
Standards notified under the Act (which continues to be applicable in
respect of Section 133 of the Companies Act, 2013 in terms of General
Circular 15/2013 dated 13th September, 2013 of the Ministry of
Corporate Affairs);
e. on the basis of written representation received from the directors
as on 31st March, 2014 and taken on record by the Board of Directors,
none of the director is disqualified as on 31st March, 2014, from being
appointed as a director in terms of clause (g) of Sub- Section (1) of
Section 274 of the Companies Act, 1956.
ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT
[Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' in the Independent Auditors'' Report of even date to the
members of Birla Cotsyn (India) Limited ("the Company") on the
financial statements for the period ended 31st March, 2014]
1 Fixed Assets:
1.1 The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets on the
basis of available information.
1.2 All the fixed assets have not been physically verified by the
Management during the period but there is a regular programme of
verification which, in our opinion, is reasonable having regard to the
size of the company and the nature of its assets. No material
discrepancies were noticed on such verification by the management
between the book and physical verification records.
1.3 In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the period. However, in the previous year the
Company had taken advances for sale of factory land situated at two
separate units of the Company and according to the information and
explanation given to us , we are of the opinion that the future
disposal of said part fixed assets will not affect the going concern
status of the company.
2 Inventories:
2.1 As per the information given to us, Inventory has been physically
verified by the management during the period. In our opinion, the
frequency of verification is reasonable.
2.2 In our opinion and according to the information and explanation
given to us, the procedures of physical verification of such inventory
followed by the Management are reasonable and adequate in relation to
the size of the Company and the nature of its business
2.3 The Company is maintaining records of inventory and no major
discrepancies were noticed between physical stock and the book records
at the end of the period.
3 Loans borrowed or given:
3.1 According to information and explanations given to us the Company
has granted loan to three companies covered in the register maintained
under section 301 of Companies Act 1956. The maximum amount involved
during the period was Rs.42,02,79,268/- and the period-end balance of
loan granted to such parties was Rs. Rs.42,02,79,268/- (including
interest accrued till 31st March, 2014).
3.2 In our opinion and according to the information and explanation
given to us, the rate of interest and other terms and conditions for
such loans are not, prima facie, prejudicial to the interest of the
Company.
3.3 The said loans (including interest thereon) are repayable on demand
and there are no repayment schedules. Accordingly, the question of
overdue amount does not arise.
3.4 As mentioned in point 3.3 above, in the absence of agreed repayment
schedule, there is no overdue amount in excess of Rs. 1 Lakh in respect
of loan granted to Companies listed in the Register maintained under
301 of the Companies Act 1956.
3.5 The Company has taken during the period fresh unsecured loan from
Company covered in the register maintained under section 301 of the
Act. The maximum amount involved during the period is Rs.10,64,18,008/-
and the period end balance of such loan is Rs.10,41,13,524/-.
3.6 In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
3.7 In respect of the aforesaid loans, since there are no terms for
repayment of interest and principal amount, we cannot comment upon the
regularity of the same.
4 Internal Control system:
4.1 In our opinion and according to the information and explanations
given to us, there is adequate internal control procedure commensurate
with the size of the Company and the nature of its business for the
purchases of inventory and fixed assets and for the sale of goods and
services.
4.2 As regards purchase of fixed assets and capitalization of work in
progress, the Company needs to strengthen internal controls for keeping
proper identification of Assets. During the year Rs.3,39,05,855/- of
Capital Advances has been adjusted against Creditors as the materials
were not supplied by them.
4.3 During the period under audit, the Company did not have any
purchase or sale of traded goods.
5 Transactions covered u/s 301 of the Companies Act, 1956:
5.1 According to the information and explanation given to us, we are of
opinion that the particulars of contract or arrangement referred to in
section 301 of the Companies Act 1956 that need to be entered into the
register maintained under section 301 have been so entered.
5.2 According to the information and explanation given to us, we are of
opinion that the transaction made in pursuance of such contracts or
arrangement exceeding the value of Rupee Five Lakh in respect of such
parties during period have been made at a price which are reasonable
having regards to prevailing market price at the relevant time.
6 Deposit from public:
6.1 The Company has defaulted in repayment of dues of Rs. 2,29,57,000
till 31st March, 2014
6.2 The Company has made fixed deposit which is lower than 15% of the
principal amount of its deposits maturing during the period ending 31st
March, 2014.
6.3 The Company has not made provision for penal interest as per the
Companies (Acceptance of deposits) Rules 1975.
7 Internal audit systems:
7.1 The Company has appointed an external firm of Chartered Accountants
as Internal Auditors of the Company. In our opinion, the scope of
Internal Audit needs to be widened.
8 Maintenance of Cost Records:
8.1 We have been informed by the Management that proper records under
clause (d) of sub -section 1 of section 209 of the Companies Act 1956
have been maintained.
9 remittance of statutory dues:
9.1 Undisputed statutory dues including provident fund, investor
education and protection fund, employees state insurance, income-tax,
sales-tax, wealth-tax, service tax, customs duty, excise duty, cess
have not been regularly deposited with the appropriate authorities and
there has been significant delay in the same.
9.2 According to the information and explanation given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees state insurance, income tax,
wealth tax, service tax, sales tax, custom duty, excise duty, cess and
other undisputed statutory dues were outstanding at the end, for the
period of more than six month from the date they became payable, except
as stated below
Name of the Nature of dues Amount(Rs) period to which due date
statute the Amount
relates
Income Tax Dividend 1,93,32,677 2009-10 04-10-2010
Distribution
tax
Income Tax TDS 20,68,460 2012-13 01-04-2012to
31-12-2012
Name of the
statute date of payment
Income Tax Not paid
Income Tax Not Paid
9.3 According to the information and explanations given to us and as
per the records of the Company examined by us, there are no dues
outstanding of sales tax, income tax, custom duty, wealth tax, service
tax, excise duty and cess, which have not been deposited on account of
any dispute.
10 Accumulated Cash Losses:
10.1 In our opinion, the accumulated losses of the company are more
than fifty percent of its net worth. The Company has not incurred any
cash losses during the period and immediately preceding current period.
11 dues to Bank and Financial Institutions
11.1 In our opinion, and according to the information and explanation
given to us, the Company has defaulted in repayment of dues to
financial institutions and banks for principal amount of
Rs.232,64,84,049/- and interest amounting of Rs.55,20,05,217/- since
May 2012 and onwards. The Company has received notice issued by
consortium of banks under section 13(2) of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security Interest
(SARFAESI) Act 2002 for non-payment of installments and interest
thereon after the due date by the company and therefore all loans
accounts became Non Performing Assets with effective from respective
dates mentioned in such notice. We are informed that the company is
contesting the action taken under section 13(4) of SARFAESI Act and
therefore the matter is sub judice.
12 Loans and Advances against Securities:
12.1 According to the information and explanation given to us and based
on the documents and records produced to us, the Company has not
granted any loans and advances on the basis of securities by way of
pledge of shares, debentures or other securities.
13 Provisions applicable to Nidhi and Chit Fund Companies:
13.1 The Company is not a Chit Fund or a Nidhi / mutual benefit fund /
society. Therefore, clause 4(xiii) of the Order is not applicable to
the Division.
14 Dealing in shares and securities
14.1 The Company is not dealing in or trading in shares, securities,
debenture, and other investments. Therefore, clause 4(xiv) of the Order
is not applicable to the Division.
15 Guarantees given by the division for Loans Taken by others:
15.1 According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
16 End use of term Loans raised:
16.1 The Company has not taken any term loans during the period under
audit. Hence the question of application of term loans for the purposes
for which they were obtained does not arise.
17 utilisation of short term Funds:
17.1 According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short term basis have been used for long-term
investments during the period under audit.
18 preferential Allotment of shares, security of debentures and public
Issue
18.1 According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties
covered in the register maintained under section 301 of the Act.
19 Issue of Debentures
19.1 The Company has not issued any secured debentures during the
period covered by our report. Accordingly, provisions of clause (xix)
of the Companies (Auditors Report) order, 2003 are not applicable.
20 public Issue
20.1 The company has not raised any money by public issues during the
period covered by our report. Accordingly, provisions of clause (xx) of
the Companies (Auditors Report) order, 2003 are not applicable
21 Frauds
21.1 During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India and according to the information and
explanation given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the period, nor
have been informed of any such case by the management.
For Samria & Co.
Chartered Accountants
FRN: 109043W
Adhar samria
place: Mumbai (Partner)
date: 1st June, 2014 M.No. 049174
Jun 30, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of Birla Cotsyn
(India) Limited ("the Company"), which comprise the Balance Sheet
as at June 30, 2013, and the Statement of Profit and Loss and Cash Flow
Statement for the period then ended and a summary of significant
accounting policies and other explanatory information.
Management''s 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 flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act"). 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.
Auditor''s 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
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditors'' judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements 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 estimates 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 qualified audit opinion.
Basis for Qualified Opinion
1. With reference to note number 8 (b) regarding Inter corporate
deposits of Rs. 186,893,684 taken from various parties as at June 30,
2013, in the absence of third party confirmation, reconciliation, if
any and other supportive audit evidence, we are unable to comment upon
such balances.
Further, few such parties have already filed winding up petition under
section 433 & 434 of the Companies Act, 1956 against the Company for
non-payment of dues. These matters are sub-judice and the impact, if
any, of the outcome is unascertainable at this stage.
2. With reference to note number 8 (b) regarding dues to related
parties of Rs. 57,725,109 and note number 29 regarding trade payables
of Rs. 294,331,451 as at June 30, 2013, in the absence of third party
confirmation, reconciliation, if any and other supportive audit
evidence, we are unable to comment upon such balances.
3. With reference to note number 13 (a) regarding capital advances of
Rs. 928,391,624 as at June 30, 2013 given to various parties, in the
absence of third party confirmation, reconciliation, if any and other
supportive audit evidence, we are unable to comment upon its
recoverability in cash or kind, if any.
4. With reference to note number 18 (a) regarding loan of Rs
72,998,404 given to one related party, which have incurred losses and
also have negative net-worth as at June 30, 2013, in the absence of
detail information of projected cash flows as at June 30, 2013 or other
supportive evidence, we are unable to comment upon its impairment, if
any.
5. With reference to note number 16 (a) regarding trade receivables of
Rs. 929,652,317 as at June 30, 2013, the Company has made provision for
doubtful debts of Rs. 798,022,082. In the absence of third party
confirmation, reconciliation, if any and other supportive audit
evidence, we are unable to comment upon its balance recoverability, if
any.
6. With reference to note number 11 (3) regarding plant and machinery
of Rs. 373,548,883 situated at one factory unit of the Company has been
generally operating at lower capacity. In the absence of future cash
flow projection and information about the value in use, we are unable
to comment impairment provision, if any as per Accounting Standard 28
"Impairment of Assets".
Qualified Opinion
In our opinion and to the best of our information and according to the
explanations given to us, subject to the effects of the matter
described in the Basis for Qualified Opinion paragraph and read with
points mentioned in Emphasis of Matter paragraph, the financial
statements give the information required by the Act in the manner so
required and give a true and fair view in conformity with the
accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at June 30, 2013;
(b) in the case of the Statement of Profit and Loss, loss for the
period ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
period ended on that date.
Emphasis of Matter
1. We draw attention to note number 2(b) in the financial statements.
The Company incurred net loss of Rs. 1,396,945,873 during the period
ended June 30, 2013 and, as of that date; the Company''s current
liabilities exceeded its current assets by Rs. 2,325,087,902 subject to
the effects of matters described in the Basis for Qualified Opinion
paragraph.. These factors along with other matters as set forth in said
note raise substantial doubt about the Company''s ability to Continue as
a going concern in the foreseeable future. However, the Company''s
financial statement has been prepared on going concern basis as
disclosed by management in said note.
2. With reference to note no 2(b) regarding notice issued by
consortium of banks under section 13(2) of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security Interest
Act 2002 for nonpayment of installments and interest thereon after the
due date by the Company and therefore all loan accounts became Non
Performing Assets with effective from respective dates mentioned in
such notice. We are informed that the Company has filed response
against such notice and requested to restructure all loan accounts.
These factors along with other matters as set forth in said note, raise
substantial doubt about the Company''s ability to Continue as a going
concern in the foreseeable future. However, the Company''s financial
statements have been prepared on going concern basis as disclosed by
management in said note.
Other matters
1. The Company has not appointed full time company secretary as per
provisions of section 383A of the Companies Act, 1956 with effective
from January 1, 2013. However, we are informed that management is under
process of appointing company secretary in due course of time.
2. The Company has not appointed a managing director or manager as
required by the provisions of section 269 of the Companies Act, 1956
with effective from April 1, 2013. However we are informed that Company
has appointed managing director before the board meeting taken in
place.
3. The Company has given loan to three related parties amounting to
Rs. 392,106,843 as at June 30, 2013 (including interest till June 30,
2013) which falls under non-compliance of section 295 of the Companies
Act, 1956.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors'' Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure, a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit except for the matter described in the Basis for Qualified
Opinion paragraph;
b. in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. except for the effects of the matters described in the Basis for
Qualified Opinion paragraph, and read with points mentioned in Emphasis
of Matter paragraph in our opinion, the Balance Sheet, Statement of
Profit and Loss and Cash Flow Statement comply with the accounting
standards referred to in sub-section (3C) of section 211 of the Act;
e. on the basis of written representations received from the directors
as on June 30, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on June 30, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
[Referred to in paragraph 1 under ''Report on Other Legal and
Regulatory Requirements'' in the Independent Auditors'' Report of even
date to the members of Birla Cotsyn (India) Limited ("the Company")
on the financial statements for the period ended June 30, 2013]
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets except some plant and machineries acquired during the period of
Rs 94,919,822 for which we have not been provided records and
identification of such assets.
(b) All the fixed assets have not been physically verified by the
management during the period but there is a regular programme of
verification which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. As informed, no
material discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the period. However, during the period the
Company has taken advances for sale of factory lands situated at two
separate units of the Company and according to the information and
explanation given to us, we are of the opinion that the future disposal
of said part fixed assets will not affect the going concern status of
the Company.
(ii) (a) As explained to us, the inventory has been physically verified
by the management during the period. In our opinion, the frequency of
verification is reasonable.
(b) The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification carried
out at the end of the period.
(iii) (a) According to information and explanations given to us the
Company has granted loans to three companies which should be covered in
the register maintained under section 301 of the Companies Act,
1956.The maximum amount involved during the period was Rs.392,106,843
and the period-end balance of loans granted to such parties was Rs.
392,106,843 (including interest accrued till June 30, 2013).
(b) In our opinion and according to the information and explanations
given to us, the rate of interest and other terms and conditions for
such loans are not, prima facie, prejudicial to the interest of the
Company.
(c) The said loans (including interest thereon) are repayable on demand
and there are no repayment schedules. Accordingly, the question of
overdue amount does not arise.
(d) As mentioned in point (c) above, in the absence of agreed repayment
schedule, there is no overdue amount in excess of Rs 1 lakh in respect
of loans granted to Companies listed in register maintained under sec
301 of the Companies Act, 1956.
(e) The company has taken during the period fresh unsecured loan from
Company covered in the register maintained under section 301 of the
Act. The maximum amount involved during the period and the period end
balance of such loan is Rs. 11,228,910.
(f) In our opinion the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(g) In respect of the aforesaid loans, since there are no terms for
repayment of interest and principal amount, we can not comment upon the
regularity of the same.
(iv) In our opinion and according to the information and explanations
given to us, there is an internal control system commensurate with the
size of the Company and the nature of its business with regard to
purchase of inventory.
As regards purchase fixed assets, the Company needs to strengthen
internal controls for keeping proper identification of assets.
As regards sales and purchase of traded goods, we are represented that
the Company directly authorize the sellers to transfer goods to the
buyers'' destination. Accordingly, the Company neither maintains any
stock of traded goods any time during the period nor keeps any records
for goods inwards and outward confirmation from such parties. Further,
in most of the cases we have noticed that the buyers'' and sellers''
accounts are settled through journal entries and we are represented
that the Company directs the buyers to pay money on behalf of the
Company to the creditors. Further, we have not been provided any
settlement letters for such transactions. We are informed that the
Company is in the process of formalizing the documentation in this
regard. The system of obtaining independent confirmation of balances of
parties requires to be given more emphasis.
(v) (a) According to the information and explanation given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under section 301 have been so
entered.
(b) According to the information and explanation given to us, we are of
the opinion that the transactions made in pursuance of such contracts
or arrangements exceeding the value of Rupees five lacs in respect of
such parties during the period have been made at a price which are
reasonable having regard to prevailing market price at the relevant
time.
(vi) As per the information and explanation given to us and based on
our audit procedures performed, we report that the Company has not
complied the following provisions / directives issued by the Reserve
Bank of India and the provisions of sections 58A, 58AA or any other
relevant provisions of the Act and the rules framed there under, where
applicable:
i) The Company has defaulted in repayment of dues of Rs.5,192,000 till
June 30, 2013.
ii) The Company has made fixed deposit which is lower than 15% of the
principal amount of its deposits maturing during the year ending March
31, 2014.
iii) We have not been provided fixed deposit register which shall be
maintained at registered office of the Company, hence we are unable to
comment upon its non-compliance, if any.
iv) The Company has not made applicable provision for penal interest as
per the Companies (Acceptance of Deposits) Rules, 1975.
v) We are informed that the Company has not intimated to the Tribunal
on monthly basis about the default in repayment as per Section 58 AA of
the Company''s Act and also not furnished the requisite return as per
the Companies (Acceptance of Deposits) Rules, 1975.
(vii) The Company does not have formal internal audit system.
(viii) We have been informed by the Management that proper cost records
under clause (d) of sub-section 1 of section 209 of the Companies Act,
1956 have been maintained. And, for the said purpose we have relied
upon the cost auditors'' certificate which has been provided to us by
the management.
(ix) (a) Undisputed statutory dues including provident fund, investor
education and protection fund, or employees'' state insurance, income-
tax, sales-tax, wealth-tax, service tax customs duty, excise duty, cess
have not been regularly deposited with the appropriate authorities and
there has been a slight delay in few cases.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other undisputed statutory dues were outstanding, at the period end,
for a period of more than six months from the date they became payable
except as stated below.
Name of the Nature of dues Amount
(RS.) * Period to
which the Due Date Date of
statute amount
relates payment
Income
Tax Act Dividend
Distribution 19,332,677 2009-10 04-10-2010 Not
Paid
Tax
Income
Tax Act TDS 1,553,593 2012-13 01-04-2012
to Not Paid
31-12-2012
(c) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues outstanding of
income-tax, sales-tax, service tax, customs duty, wealth tax, excise
duty and cess on account of any dispute.
(x) In our opinion, the accumulated losses of the Company are not more
than fifty percent of its net worth except qualifications mentioned in
Basis for Qualified Opinion Paragraph in our audit report. Further, the
company has also incurred cash losses during the period of Rs
1,385,611,216 covered by our audit. There were no cash losses
immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has defaulted in repayment of dues to
financial institutions and banks for Principal amount of Rs.
211,663,000 and Interest amounting of Rs. 322,145,922 since May 2012.
(xii) According to information and explanation given to us and based on
the documents and records produced to us, the company has not granted
loans & advances on the basis of security by way of pledge of shares,
debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor''s Report) Order, 2003 (as amended)
are not applicable to the Company.
(xiv) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments.
(xv) In our opinion and according to the information and explanations
given to us, the Company has not given any guarantees for loans taken
by others from banks or financial institutions during the period.
(xvi) To the best of our knowledge and belief and according to the
information and explanations given to us, in our opinion, the term
loans availed by the Company were, prima facie, applied by it during
the period for the purpose for which the loans were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given to us, the
company has not made any preferential allotment of shares to parties
covered in the Register maintained under Section 301 of the Act.
(xix) The Company has not issued any secured debentures during the
period covered by our report. Accordingly, provisions of clause (xix)
of the Companies (Auditor''s Report) Order; 2003 are not applicable.
(xx) The Company has not raised any money by public issues during the
period.
(xxi) During the course of our examination of the books and 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 instance of
fraud on or by the Company, noticed or reported during the period, nor
have we been informed of any such case by the management.
For Kanu Doshi Associates
Chartered Accountants
Firm Registration No. 104746W
Manoj Kumar Pati
Partner
Membership No.504536
Place: Mumbai
Date: August 29, 2013.
Mar 31, 2012
1. We have audited the attached Balance Sheet of Birla Cotsyn (India)
Limited ('the Company' ) as at March 31, 2012 and also the Statement
of Profit and Loss and the cash flow statement for the year ended on
that date 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 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 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, as
amended by the Companies (Auditor's Report) (Amendment) Order 2004,
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of 'The Companies Act, 1956' of India (the
'Act' ) and on the basis of such checks of the books and records of
the Company as we considered appropriate and according to the
information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4. Further to our comments in the paragraph 3 above, we report that:
i. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
ii. In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books.
iii. The balance sheet, Statement of Profit and Loss and cash flow
statement dealt with by this report are in agreement with the books of
account.
iv. In our opinion, the balance sheet, Statement of Profit and Loss
and cash flow statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956.
v. On the basis of the written representations received from the
directors, as on March 31, 2012 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2012 from being appointed as a director in terms of clause
(g) of sub-section (I) of section 274 of the Companies Act, 1956.
vi. Certain balances of Trade Receivables and Trade Payables are
Subject to confirmation and reconciliation, if any.
vii. in our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India;
a) in the case of the balance sheet, of the state of affairs of the
Company as at March 31, 2012;
b) in the case of the statement of profit and loss, of the profit for
the year ended on that date; and
c) in the case of cash flow statement, of the cash flows for the year
ended on that date.
ANNEXURE TO AUDITORS' REPORT
[Referred to in paragraph 3 of the Auditors' Report of even date to the
members of Birla Cotsyn (India) Limited on the financial statements for
the year ended 31st March 2012]
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All the fixed assets have not been physically verified by the
management during the year but there is a regular programme of
verification which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. As informed, no
material discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the company during the year.
(ii) (a) As explained to us, the inventory has been physically verified
by the management during the year. In our opinion, the frequency of
verification is reasonable.
(b) The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification carried
out at the end of the year.
(iii) (a) According to information and explanations given to us the
company has not granted any loans, secured or unsecured, to or from
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Accordingly, the
sub-clauses (b), (c) and (d) of clause (iii) are not applicable to the
company.
(e) The company has not taken during the year any fresh unsecured loans
from company covered in the register maintained under section 301 of
the Act but it has opening balance outstanding of loan taken from one
company covered in the register maintained under section 301 of The
Act. The maximum amount involved during the year and the year end
balance of such loans aggregates to Rs. 23,09,44,047/- and Rs. NIL
respectively.
(f) In our opinion the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(g) In respect of the aforesaid loans, since there are no terms for
repayment of interest and principal amount, we can not comment upon the
regularity of the same.
(iv) In our opinion and according to the information and explanations
given to us, there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and with
regard to the sale of goods and services. During the course of our
audit, we have not observed any continuing failure to correct major
weaknesses in internal control system of the Company.
(v) (a) In respect of transactions entered in the register maintained
in pursuance of Section 301 of the Companies Act, 1956, to the best of
our knowledge and belief and according to the information and
explanations given to us, particulars of contracts or arrangements that
needs to be entered into the register have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of the contracts or
arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956 and exceeding the value of Rupees five lacs in
respect of such party during the year have been made at a price which
are reasonable having regard to prevailing market price at the relevant
time.
(vi) The Company has complied with the directives issued by the Reserve
Bank of India and the provisions of sections 58A, 58AA or any other
relevant provisions of the Act and the rules framed there under, where
applicable except with respect to one loan taken from an individual
where the provisions of sections 58A, 58AA or any other relevant
provisions of the Act and the rules framed there under have not been
complied with. However the company has repaid the same during the year.
(vii) In our opinion, the company has an internal audit system but it
needs to be strengthened both in terms of coverage and periodicity to
be commensurate with the growth in size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (I) of Section 209 of the
Act and we are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained.
(ix) (a) The Company is generally regular in depositing with
appropriate authorities undisputed statutory dues including provident
fund, investor education and protection fund, employees' state
insurance, income-tax, sales-tax, wealth-tax, service tax, customs
duty, excise duty, cess and other material statutory dues applicable to
it.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other undisputed statutory dues were outstanding, at the year end, for
a period of more than six months from the date they became payable
except as stated below.
Name of the Nature of Amount Period to Due Date Date of
statute dues (Rs in which the payment
Lacs)* amount
relates
Income Tax Dividend 1,20,28,236 2009-10 4-10-2010 Not paid
Act, 1961 Distribu
tion Tax
Income Tax Advance 92,25,000 2012-13 Sep 2011 Not Paid
Act, 1961 Tax
* Excludes penalty or interest thereon, if any.
(c) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues outstanding of
income-tax, sales-tax, service tax, customs duty, wealth tax, excise
duty and cess on account of any dispute.
(x) The Company does not have accumulated losses at the end of the year
and it has not incurred cash losses in the current year as well as in
the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has defaulted in repayment of dues to
financial institutions and banks for Principal amount of
Rs.5,01,86,776/- and Interest amount of Rs.4,04,I4,I0I/- since January
2012.
(xii) According to information and explanation given to us, we are of
the opinion that the Company has not granted any loans and advances on
the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor' s Report) Order, 2003 (as amended)
are not applicable to the Company.
(xiv) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments.
(xv) In our opinion and according to the information and explanations
given to us, the company has not given any guarantees for loans taken
by others from banks or financial institutions during the year.
(xvi) To the best of our knowledge and belief and according to the
information and explanations given to us, in our opinion, the term
loans availed by the Company were, prima facie, applied by it during
the year for the purpose for which the loans were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given to us, the
company has made preferential allotment of shares to two parties
covered in the Register maintained under Section 30I of the Act. In our
opinion, the price at which shares have been issued is not prejudicial
to the interest of the company.
(xix) The Company has not issued any secured debentures during the
period covered by our report. Accordingly, provisions of clause (xix)
of the Companies (Auditor' s Report) Order; 2003 are not applicable.
(xx) The Company has not raised any money by public issues during the
year.
(xxi) During the course of our examination of the books and 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 instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the management.
For Kanu Doshi Associates
Chartered Accountants
FRN No. I04746W
Jayesh Parmar
Partner
Membership No.45375
Place: Mumbai
Date: May 29, 2012
Mar 31, 2011
1. We have audited the attached Balance Sheet of Birla Cotsyn (India)
Limited ('the Company') as at March 3 1, 2011 and also the Profit and
Loss account and the cash flow statement for the year ended on that
date 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. The financial
statements for the year ended March 31, 2010 have been audited by
another firm of Chartered Accountants. We have relied on the same for
the purpose of this report.
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 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 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, as
amended by the Companies (Auditor's Report) (Amendment) Order 2004,
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of The Companies Act, 1956' of India (the Act') and on
the basis of such checks of the books and records of the Company as we
considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order.Further to
our comments in the paragraph 3 above, we report that:
i. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
ii. In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books.
iii. The balance sheet, profit and loss account and cash flow statement
dealt with by this report are in agreement with the books of account In
our opinion, the balance sheet, profit and loss account and cash flow
statement dealt with by this report comply with the Accounting
Standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956.
iv. On the basis of the written representations received from the
directors, as on March 3 1, 2011 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2011 from being appointed as a director in terms of clause
(g) of sub-section (I) of section 274 of the Companies Act, 1956.
v. in our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India;
a) in the case of the balance sheet, of the state of affairs of the
Company as at March 3 1, 2011;
b) in the case of the profit and loss account, of the profit for the
year ended on that date; and
c) in the case of cash flow statement, of the cash flows for the year
ended on that date.
ANNEXURE TO AUDITORS' REPORT
[Referred to in paragraph 3 of the Auditors' Report of even date to the
members of Birla Cotsyn (India) Limited on the financial statements for
the year ended 3 1 st March 2011 ]
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All the fixed assets have not been physically verified by the
management during the year but there is a regular programme of
verification which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. As informed, no
material discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the company during the year.
(ii) (a) As explained to us, the inventory has been physically verified
by the management during the year. In our opinion, the frequency of
verification is reasonable.
(b) The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification carried
out at the end of the year.
(iii) (a) The company has granted unsecured interest free loan to one
Company, covered in the register maintained under section 301 of the
Act. The maximum amount involved during the year and the year end
balance of such loans aggregates to Rs. 4,5 1,73,948/- and Rs. 4,5
1,73,948/- respectively.
(b) In our opinion the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(c) The above loan is receivable on demand hence the clause (iii) (c)
of para 4 of the order is not applicable.
(d) Since the above loan is receivable on demand and interest free,
clause (iii) (d) of para 4 of the order is not applicable.
(e) The company has taken unsecured loans, from three companies covered
in the register maintained under section 301 of the Act. The maximum
amount involved during the year and the year end balance of such loans
aggregates to Rs. 42,44,71,466/- and Rs.23,09,44,047/- respectively.
(f) In our opinion the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(g) In respect of the aforesaid loans, the Company is regular in
repaying the principal amounts wherever stipulated and is also regular
in payment of interest, where applicable.
(iv) In our opinion and according to the information and explanations
given to us, there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and with
regard to the sale of goods and services. During the course of our
audit, we have not observed any continuing failure to correct major
weaknesses in internal control system of the Company.
(v) (a) In respect of transactions entered in the register maintained
in pursuance of Section 301 of the Companies Act, 1956, to the best of
our knowledge and belief and according to the information and
explanations given to us, particulars of contracts or arrangements that
needs to be entered into the register have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of the contracts or
arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956 and exceeding the value of Rupees five lacs in
respect of such party during the year have been made at a price which
are reasonable having regard to prevailing market price at the relevant
time.
(vi) The Company has complied with the directives issued by the Reserve
Bank of India and the provisions of sections 58A, 58AA or any other
relevant provisions of the Act and the rules framed there under, where
applicable except with respect to one loan taken from an individual
where the provisions of sections 58A, 58AA or any other relevant
provisions of the Act and the rules framed there under have not been
complied with.
(vii) In our opinion, the company has an internal audit system but it
needs to be strengthened both in terms of coverage and periodicity to
be commensurate with the growth in size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (I) of Section 209 of the
Act and we are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained.
(ix) (a) The Company is generally regular in depositing with
appropriate authorities undisputed statutory dues including provident
fund, investor education and protection fund, employees' state
insurance, income-tax, sales-tax, wealth-tax, service tax, customs
duty, excise duty, cess and other material statutory dues applicable to
it.
Further, since the Central Government has till date not prescribed the
amount of cess payable under section 441A of the Companies Act, 1956,
we are not in a position to comment upon the regularity or otherwise of
the company in depositing the same.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other undisputed statutory dues were outstanding, at the year end, for
a period of more than six months from the date they became payable
except as stated below.
Name of Nature Amount Period to Due Date Date of
the of dues (Rs in which the payment
statute Lacs)* amoun
relates
Income Dividend 1,20,28,236 2009-10 4-10-2010 Not paid
Tax Act, Distribu
1961 tion Tax
* Excludes penalty or interest thereon, if any.
(c) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues outstanding of
income-tax, sales-tax, service tax, customs duty, wealth tax, excise
duty and cess on account of any dispute.
(x) The Company does not have accumulated losses at the end of the year
and it has not incurred cash losses in the current year as well as in
the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
financial institutions, banks or debenture holders.
(xii) According to information and explanation given to us, we are of
the opinion that the Company has not granted any loans and advances on
the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended)
are not applicable to the Company.
(xiv) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments.
(xv) In our opinion and according to the information and explanations
given to us, the company has not given any guarantees for loans taken
by others from banks or financial institutions during the year.
(xvi) To the best of our knowledge and belief and according to the
information and explanations given to us, in our opinion, the term
loans availed by the Company were, prima facie, applied by it during
the year for the purpose for which the loans were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given to us, the
company has made preferential allotment of shares to one party covered
in the Register maintained under Section 301 of the Act. In our
opinion, the price at which shares have been issued is not prejudicial
to the interest of the company.
(xix) The Company has not issued any secured debentures during the
period covered by our report. Accordingly, provisions of clause (xix)
of the Companies (Auditor's Report) Order; 2003 are not applicable.
(xx) We have verified the end use of money raised by public issues as
disclosed in the notes to the financial statements. (See Note (10A) and
(10Q)-
(xxi) During the course of our examination of the books and 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 instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the management.
For Kanu Doshi Associates
Chartered Accountants
FRN No. I04746W
Jayesh Parmar
Partner
Membership No.45375
Place : Mumbai
Date : 23rd May, 2011
Mar 31, 2010
1. We have audited the attached Balance Sheet of Birla Cotsyn (india)
Limited (the "Company") as at March 31, 2010, and the related Profit
and Loss Account and Cash Flow Statement for the year ended on that
date annexed thereto, which we have signed under reference to this
report. These financial statements are the responsibility of the
Companys Management. Our responsibility is to express an opinion on
these financial statements based on our audit.
2. We conducted our audit in accordance with the 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 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 financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004
(together the "Order"), issued by the Central Government of india in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956
of india (the Act) and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have 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 as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on March 31, 2010 and taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2010
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act;
(f) in our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, and give a true and fair
view in conformity with the accounting principles generally accepted in
india:
(i) in the case of the Balance Sheet, of the state of affairs of the
company as at March 31, 2010;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure to Auditors Report
Referred to in paragraph 3 of the Auditors Report of even date to the
members of Birla Cotsyn (india) Limited on the financial statements
for the year ended March 31, 2010
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets of the Company have been physically verified by
the Management during the year and no material discrepancies between
the book records and the physical inventory have been noticed. in our
opinion, the frequency of verification is reasonable.
(c) in our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. (a) The inventory (excluding stocks with third parties) has been
physically verified by the Management during the year. in respect of
inventory lying with third parties, these have substantially been
confirmed by them. in our opinion, the frequency of verification is
reasonable.
(b) in our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained under
Section 301 of the Act.
(b) The Company has taken unsecured loans, from two companies covered
in the register maintained under Section 301 of the Act. The maximum
amount involved during the year and the year-end balance of such loans
aggregates to Rs.8,21,52,886 and Rs.6,73,00,000, respectively.
(c) in our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(d) in respect of the aforesaid loans, the Company is regular in
repaying the principal amounts as stipulated and is also regular in
payment of interest, where applicable.
4. in our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. (a) in our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required sto be maintained under that section.
(b) in our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. Except for a loan taken from an individual which is not in
accordance with the provisions of Section 58A of the Act, the Company
has not accepted any deposits from the public within the meaning of
Sections 58A and 58AA of the Act and the rules framed there under. With
respect to the loan from an individual referred to above the provisions
of Sections 58A and 58AA of the Act and the rules framed there under
have not been complied.
7. in our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the Rules made by the
Central Government of india, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion,
the Company is generally regular in depositing the undisputed statutory
dues including provident fund, investor education and protection fund,
employees state insurance, income-tax, sales-tax, wealth tax, service
tax, customs duty, excise duty, cess and other material statutory dues
as applicable with the appropriate authorities.
Except for advance income tax aggregating Rs.86,26,480, there were no
undisputed dues outstanding for more than six months as at March 31,
2010;
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of income-tax,
sales-tax, wealth-tax, service-tax, customs duty, excise duty and cess
which have not been deposited on account of any dispute.
10. The Company does not have any accumulated losses as at March 31,
2010 and it has not incurred any cash losses in the financial year
ended on that date or in the immediately preceding financial year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. in view of the nature of business carried on by the Company, the
provisions of any special statute applicable to chit fund / nidhi /
mutual benefit fund/ societies are not applicable to the Company.
14. in our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. in our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
16. in our opinion, and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained, other than temporary
deployment pending utilization;
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short-term
basis which have been used for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The Company has not issued any secured debentures during the
period covered by out report. Accordingly, provisions of clause (xix)
of the Companies (Auditors Report) Order, 2003 are not applicable.
20. Money raised by the Company from Public issue on March 15, 2010
has been temporarily deployed in the current account with a bank
pending application for the purpose for which it is raised. The same
has been disclosed by the Company in the Note 9 ( c) of Schedule 21 to
the Accounts for the year.
21. During the course of our examination of the books and 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 instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the Management.
For and on behalf of
Dalal & Shah
Firm Registration Number 102021W
Chartered Accountants
S Venkatesh
Mumbai, Partner
August 10, 2010 Membership Number 037942
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Stocks To Buy Today, Dec 12: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Friday -
Market Outlook 2026: Kotak Securities Sees Nifty 50 at 30,000; THESE 4 Sectors Lead Rally, Gold To Stay Strong -
Stocks To Buy Today, Dec 10: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Wednesday -
D-Street Bleeds For 2nd Day! Sensex Slumps 678 Pts; Nifty Cracks 25,800; Why Stock Market Is Falling Today? -
Stocks To Buy Today, Dec 9: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Tuesday -
Stocks To Buy Today, Dec 8: Top 4 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Monday -
Stock Market Alert! Major Pre-Open Session Change From Dec 8: Full Timings, Rules & All You Need To Know -
Bank Nifty Surges: RBI’s 25 bps Rate Cut Triggers Strong Upside in Major Banking Stocks -
Closing Bell: Sensex Ends 158 pts Higher, Nifty Climbs Above 26,000; Hero MotoCorp, HAL Up 2% Each -
Stocks To Buy Today, Dec 4: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday
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