BENZO PETROCHEMICALS LIMITED
ANNUAL REPORT 2001-2002
The Members of
BENZO PETRO CHEMICALS LTD.
AUDITOR'S REPORT OF BENZO PETRO CHEMICALS LIMITED
We have audited the attached Balance Sheet of BENZO PETRO CHEMICALS LTD. as
on 31st March, 2002, and also the Profit and Loss Account 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.
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
statement. 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.
1. As required by the manufacturing and other companies (Auditor's Report)
order, 1988, issued by the company Law Board in terms of Section 227(4A) of
the Companies Act, 1956 and in terms of, information and explanations given
to us and on the basis of such checks as we considered appropriate, we
enclose in the annexure a statement on the matters specified in paragraph 4
and 5 of the said order.
2. Further to our comments in the Annexure referred to in paragraph 1
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 purpose of our audit.
b) In our opinion proper books of account as required by Law have been
kept by the company so far as appears from our examination of such books.
c) The Balance Sheet and Profit and Loss Account dealt with by this Report
are in agreement with the Books of account.
d) In our opinion, the Profit and Loss Account and Balance sheet dealt with
by this report comply with the accounting standards.
(Except AS-2 Regarding "Valuation of Inventories") referred to in Sub-
Section(3C) of Section 211 if the Companies Act, 1956 so far as it is
applicable to the Company.
e) On the basis of written representation received from the director's and
taken on records by the Board of directors, we report that none of
Directors is disqualified as on 30-03-2002 from being appointed as Director
in term of clause (g) of sub section(1) of Section 274 of Companies Act,
In our opinion and to the best of our information and according to the
explanations given to us, the said accounts subject to following,
The Company has been unable to re-negotiate its revival scheme for
financial Institution and bank borrowings at BIFR, and AAIFR who confirmed
the order of BIFR for winding up of the company. (Refer Note No. X off
Schedule-L - "Note on Accounts").
In our opinion, without financial support there is substantial doubt that
the Company will be able to continue as going concern, despite the accounts
are prepared on "going concern" basis. (Refer Note-1(A) in Schedule-K).
Consequently, adjustment may be required to the recorded amount and
classification of assets and liabilities. The financial statements (and
notes thereto) does not disclose this fact, and read with the notes
thereon, give the information required by the Companies Act, 1956, in the
manner so required but does not give true and fair view in conformity with
the accounting principle of "going concern".
I. In the case of Balance Sheet, of the State of Affairs of the Company at
31st March, 2002.
II. In the case of Profit and Loss Account, of the Loss for the year ended
on that date.
For J. HARKISONDAS & CO.,
Place: BARODA (RASHMI ACHARYA)
Date : 3-7-2002 PARTNER
ANNEXURE TO THE AUDITOR'S REPORT REFERRED TO IN PARAGRAPH-1 OF OUR REPORT
OF EVEN DATE ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2002 OF BENZO PETRO
In our opinion and on the basis of such checks as we considered appropriate
and according to information and explanation given to us, we start that
01. We have been informed that the Company has maintained proper records
showing full particulars, including quantitative details and situations of
Fixed Assets. We are also informed that al the Assets have not been
physically verified by the management during the years.
02. None of the Fixed Assets have been revalued during the year.
03. As informed to us, the Stock of Finished goods, Stores, Spares and Raw
Materials have not been physically verified during the year by the
04. As the Stock of Finished goods, stores, spares and Raw materials have
not bees physically verified during the year by Management, we are unable
to give our opinion for item Number (IV), (V) and (VI) of clause (A) of the
05. As informed to us, the company has not taken secured or unsecured loans
from the companies, firm or other parties listed in the register maintained
under section 301 of the Companies act, 1956. In view of provisions of
section 370 of Companies Act, 195 not being applicable, Loan from Companies
under same management, if any, have not been commented upon.
06. As informed to us, the Company has not granted interest from unsecured
loans the Companies, or other parties listed in the registers maintained
under section 301 of the Companies Act, 1956. In view of provision of
Section 370 of Companies under same management, if any, have not been
07. We are informed that the parties (including employees) to whom loans or
advance in the nature of loans, have been given by the company are not
repaying the principle amount as stipulated.
08. As the Company has stopped its business activities, we are unable to
comment on the adequacy of internal control System.
09. According to the information and explanation given to us, there were no
transactions for the purchase of the goods and the materials and the sales
of goods, material and services made in pursuance of contracts or
arrangements with the parties, and attracting provisions of the section 301
of the companies Act, 1956 and aggregating during the year Rs.50,000/- or
more in respect of each party.
10. As explained to us, the company has no procedure for the determination
of unserviceable or damaged stores, raw materials and finished goods, and
no provisions has been made in the accounts for the loses, if any, arising
due to its deterioration as the stock of Chemicals etc. are too old and out
11. As informed to us, the company has not accepted any deposits from the
public, hence the provisions of section 58A of companies act 1956 and the
companies (Acceptance of Deposits) rules, 1975, do not apply.
12. As the Company has stopped its business activities, the Company has not
generated any by products and scrap during the year.
13. Company do not have an internal audit system commensurate with size and
nature of its business.
14. We have been informed that the Central Government has not prescribed
the maintenance of the cost records under section 209(i)(d) of the
Companies Act, 1956 for the products of the Companies.
15. As there is no employee on payroll, provisions of provident fund and
ESIC acts are not applicable to the Company.
16. According to the information and explanations given to us no undisputed
amount payable in respect of Income Tax, Sales Tax, Customs Duty and Excise
Duty were outstanding as on 31st March, 2002 for a period of more than six
months from the date they became payable.
17. According to the information and explanations given to us, no personal
expenses of Employees or Directors have been charged to revenue accounts,
other than those payable under contractual obligation or in accordance with
generally accepted business practice.
18. The Company is a Sick Industrial company within the meaning of clause
(O) of Sub-Section(1) of section (3) of the Sick Industrial Companies
(Special Provisions) Act, 1985. We have been informed that the Board has
made an application on 24-07-1998 to the Board for Industrial and Financial
reconstruction for the same and the company is declared sick by the BIFR
vide their order dated 23-12-1998. (Ref No. 208/98).
For J. HARKISONDAS & CO.,
Place: Baroda (RASHMI ACHARYA)
Date : 3-7-2002 PARTNER
CASH FLOW NOTES:
Figures in brackets represent out flows.