To The Members of Lakhani India Limited
We have audited the attached Balance Sheet of Lakhani India Limited as
at March 31,2009, and the Profit & Loss Account and Cash Flow Statement for the period
01.04.2008 to 31.03.2009 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.
1. We conducted our audit in accordance with Auditing Standards generally accepted in
India. Those Standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatements. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by the management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
2. As required by the Companies (Auditors' Report) order, 2003, issued by the Central
Government of India in terms in Sub-section (4A) Section 227 of the Companies Act, 1956,
we enclosed in the Annexure a statement on the matters specified in paragraphs 4 &5 of
the said order.
3. Further to our comments in the Annexure referred to 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 examination of these books read with our comments in para 3
(c) of Annexure to this report.
(iii) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with
by this report are in agreement with the books of account.
(iv) In our opinion, the Balance Sheet, Profit & Loss Account Cash Flow Statement
dealt with by this report comply with 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 31
March, 2009 and taken on record by the Board of Directors, we report that none of the
Directors is disqualified as on 31 March, 2009 from being appointed as a director in terms
of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.
(vi) In our opinion and to the best of our information and according to the
explanations given to us, the said financial statement read with notes thereon 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 the affairs of the Company as at
31st March, 2009.
b) In the case of the Profit and Loss Account, of the Profit for the year ended on that
c) In the case of the Cash Flow Statement, of the cash flow for the year ended on that
||For R.N. Bahl & Co.
|Place: New Delhi
|Dated : 29th September, 2009
ANNEXURE TO AUDITORS' REPORT
(Referred to in paragraph 2 of our Report of even date)
1. The nature of Company's activities during the year have been such that clauses
(xii),(xiii),(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to
the Company for the year.
2. (a) The fixed asset register of the company is under preparation. As informed the
old fixed asset register is mislaid during family settlement process.
(b) As informed company has programme of physical verification of Fixed Assets in a
phased manner. In accordance with the same, certain plants & machineries were
physically verified during the year. It is certified by the company that there are no
discrepancies in respect of fixed assets verified during the year.
(c) The company has not disposed off a substantial part of fixed assets during the
(3) (a) Physical verification of inventory has been conducted during the year by the
management /outside Agencies at reasonable intervals.
(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 nature of its business.
(c) The company is keeping the stock records on "Card System basis". It is
informed that there were no material discrepancies between the physical balance and
balance as per Cards. We are unable to comment on the accuracy of this system.
4. 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 Companies Act,
1956. Therefore provisions of clauses (iii)(b),(iii)(c),(iii)(d) of paragraph 4 of the
Order are not applicable.
The Company has taken unsecured loans from its directors / parties covered in the
register maintained under Section 301 of the Companies Act, 1956. The maximum amount
involved during the year was Rs. 214.48 lacs and the year end balance of loans taken was
In our opinion and according to the information and explanation given to us, the rate
of interest and other terms and conditions of such loans are, prima-facie not prejudicial
to the interest of the Company.
In respect of unsecured loan taken by the Company, the loan amount is payable on demand
and is interest free.
(5) In our opinion and according to the information and explanations given to us, there
are adequate internal control procedures commensurate with the size of the Company and the
nature of its business for purchase of inventory, fixed assets and for the sale of goods.
During the course of audit, we have not observed any other continuing failure to correct
major weaknesses in internal controls.
(6) In our opinion and according to the information and explanations given to us, the
transactions that need to be entered into register in pursuance of Section 301 of the Act,
have been so entered and the transactions have been made at prices, which are reasonable
having regard to prevailing market prices at the relevant time as certified by the
management and relied upon by us. Substantial transactions of purchases/sales are
explained to be specific and customised.
(7) The Company has not accepted deposits from the public within the meaning of Section
58A and 58AA of the Companies Act, 1956 and the Rules framed there under.
(8) There is no formal Internal Audit System prevalent in the organization. However we
are informed that there are sufficient check systems commensurate with the size of company
and nature of its business.
(9) Cost records for the year under Audit as required u/s 209(1) (d) of the Companies
Act, 1956 are under preparation. We have perused the Cost Audit Report for the financial
year ending 31st March,2008 confirming that proper cost records have been maintained.
(10) According to the information and explanation given to us in respect of statutory
and other dues:
(a) The Company has been generally regular in depositing with appropriate authorities
undisputed statutory dues including Provident Fund, Investor Education and Protection
Fund, E.S.I, Sales Tax, Customs Duty, Excise Duty, Income Tax, Wealth Tax, Cess and any
other statutory dues during the year.
(b) According to the information and explanation given to us, no undisputed amounts
payable in respect of income tax, wealth tax, sales tax, customs duty, excise duty and
cess were in arrears , as at 31st March 2009 for a period of more than six
months from the date they become payable.
(c) According to the information and explanations given to us, there are no cases of
non-deposit with the appropriate authorities of disputed dues of sales tax / income tax /
excise duty/ custom duty / wealth tax and cess except as stated below:
||Nature of dues/ Period
||Name of Statute
||Amount (Rs. In Lacs)
||Forum where dispute is pending
||Income Tax (A.Y. 2004-05 to 2006-07)
||Income Tax Act, 1961
||Sales Tax ( 2002-03 to 2005-06)
||Haryana Sales Tax Act
||Appeals yet to be filed
(11) The Company does not have any accumulated losses as on 31st March,
2009. The Company has not incurred cash losses during the financial year covered by our
audit and in the immediately preceding financial year.
(12) In our opinion and according to the information and explanation given to us, the
Company has not defaulted in repayments of dues to financial institution and banks.
(13) According to the information and explanations given to us, the Company has not
granted any loans and advances on the basis of security by way of pledge of shares,
debentures and other securities.
(14) According to the information and explanations given to us, the company is not a
chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause
4 (Xiii) of the Order are not applicable to the Company.
(15) According to the information and explanation given to us, the Company is not
engaged in dealing or trading in securities, debentures and other investments.
Accordingly, the provisions of the clause 4 (xiv) of the Order are not applicable to the
(16) 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.
(17) In our opinion the term loans have been applied for the purpose for which they
(18) According to information and explanation 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.
(19) The Company has not made any preferential allotment of shares during the year and
hence we have no comments to offer in respect of clause 4(xvii) of the companies
(Auditor's Report) Order, 2003.
(20) No debentures have been issued by the company during the year as such no
securities for the purpose has been created.
(21) During the year, the Company has not raised money by public issue.
(22) According to the information and explanation given to us, no fraud on or by the
Company has been noticed or reported during the financial year.
||For R.N. Bahl & Co.
|Place: New Delhi
|Dated : 29th September, 2009