To the member of
SHEEL INTERNATIONAL LIMITED
We have audited the attached balance sheet of M/s SHEEL INTERNATIONAL LIMITED asat 31st march, 2011 and profit & loss accounts of the company for the year ended onthat date annexed there to. These financial Statements are the responsibility of theCompanys management. Our responsibility is to express an opinion on these financialstatements based on our audit.
We conducted our audit in accordance with accounting standards generally accepted inIndia. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatements. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosurein the financial statements. An audit also includes assessing the accounting principlesused and significant estimates made by management, as well as evaluating the overallfinancial statement presentation. We believe that our audit provides a reasonable basisfor our opinion.
As required by the Companies (Auditors Report) Order, 2003 as amended by theCompanies Auditors (Amendment) Order, 2004 (the "Order"), issued by theCentral government of India in terms of sub-section (4A) of section 227 of the CompaniesAct, 1956 (the "Act"), We file the Annexure A statement on the matters specifiedin paragraphs 4 and 5 of the said Order.
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 ourknowledge 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 theCompany so far as appears from our examination or those books;
iii. The Balance Sheet, Profit and Loss Account and dealt with by this report are inagreement with the books of account;
iv. In our opinion and to the best of our information and according to explanationsgiven to us, the financial statements, read together with the notes thereon, comply withthe accounting standards referred to in subsection (3C) of Section 211 of the Act, givethe information required by the Act, in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India, subject tothe following.
(a) Note No. 6: Non provision of depreciation on Plant & Machinery.
(b) Note No. 7: Suspension of trading in securities of the company by the BSE.non filling of Listing requirement and other guidelines of the relevant authorities/law.
a) the Balance Sheet, of the state of affairs of the company as at March 31, 2011;
b) the Profit and Loss Account, of the Loss for the year ended on that date; and
c) On the basis of written representations received from the directors and taken onrecord by the Directors, we report that none of the directors is disqualified as on March31,2011 from being appointed as a director in terms of clause (g) of sub-section (1) ofSection 274 of the Act.
| ||FOR MANOJ SANGEETA & ASSOCIATES |
| ||Chartered Accountant |
| ||Sd/- |
|Place : New Delhi ||MANOJ KUMAR |
|Dates : 02.08.2011 ||Chartered Accountant |
| ||M.NO-098161 |
ANNEXURE TO AUDITORS REPORT TO THE MEMBER OF SHEEL INTERNATIONAL LIMITED
Annexure to the auditors report of even date to the members of the SheelInternational Limited on the Financial Statements for the year ended March 31st 2011.
Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and in terms of the information and explanationsgiven to us and the books and records examined by us in the normal course of audit, wereport that;
i) a) The Company has not maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b) Company has not physically verified the fixed assets during the year, hencediscrepancy, if any, cannot be commented.
c) The Fixed assets disposed off during the year are not substantial and hence it hasnot affected the going concern assumption .
ii) a) Inventory has been physically verified by the company as per Managementassurance but there is no frequency registered of physical checking in the company, wecannot comment on that.
b) as per clause (a) due to non maintenance of frequency of physical verification, wecan not comment on that, whether the physical verification of inventory is reasonable ornot.
c) The Company has maintained proper records of inventory and no material variation hasbeen noticed.
iii) (a) to (d) The company has maintained registered under Section 301 of thecompanies Act, 1956, The Company has taken loan in previous years from the JaysheeInvestment Pvt. Ltd. (parties covered under Section 301) and as per the explanation givenby the management company has paid loan of Rs.23,50,000 during the year and no othertransaction with parties U/s 301 has been noticed.
iv) In our opinion, there are adequate internal control systems commensurate with thesize of the Company and the nature of its business, for the fixed assets and for the saleservices. During the course of our audit, no major weakness has been noticed in theinternal controls in respect of these areas.
v) According to the information and explanation given to us, there was no transactiontaken place during the year with any party covered under section 301 of the Companies Actexcept mentioned in clause (iii). However we have not been provided any register to bemaintained as per provisions of the Act and therefore, Para 4 (v) and (b) are notapplicable to the company.
(vi) According to the information and explanation given to us, the company has notaccepted deposit from Public during the year under audit.
(vii) According to the information and explanation given to us, the company is nothaving any internal audit system.
(viii) According to the information and explanation given to us, the Central Governmenthas not prescribed maintenance of cost records under clause (d) of sub-section (1) ofsection 209 of the Companies Act, 1956 by the Company.
(ix) The Company has following dues payable in respect of income tax dues for thevarious assessment year which are as under
Rs. 7,46,000/- for the A.Y. 1996-97
Rs. 87,137/- for the A.Y. 1997-98
Rs. 9,49,589/- for the A.Y. 1998-99
Rs. 1,40,215/- for the A.Y. 1998-99 (TDS)
Rs. 6,000/- for the A.Y. 1999-2000
And in respect of the wealth tax, sales tax, custom duty and excise duty no informationhas been provided to us in respect of undisputed amount as at 31 March 2011, for theperiod more than six months from the date they become payable. Further we have not beenprovided with any tax assessment orders.
(x) The Company has accumulated losses at the end of the financial year 2010-11 Rs.1,74,18,594/- which is less than 50% of its net worth, and the company has not incurredany cash losses during the year.
(xi) The Company has Settled down the repayment of dues to financial institution andbanks. Regarding settlement of loan, only 7,97,245/- outstanding in the books of accountsof the company at the end of the financial year under audit , which has been paid inbeginning of the next year.
(xii) The Company has not granted any loans and advances on the basis of security byway of pledge of shares, debentures and other securities.
(xiii) The Company is not a chit fund of a nidhi/mutual benefit fund /society.Accordingly, the provisions of clause 4(xii) of the Order are not applicable to theCompany.
(xiv) The Company is not dealing in trading of shares, securities, debentures and otherinvestments.
(xv) The Company has not given guarantee for loans taken by others from banks offinancial institutions, the terms and conditions whereof in our opinion are not applicableto the Company.
(xvi) In our Opinion and according to the explanation provided to us, this clause isnot applicable to the company.
(xvii) Based on an overall examination of the Balance Sheet and of the Company, wereport that no funds raised on short terms basis have been used for long term investment.(excludes permanent working capital)
(xviii)The Company has not made any preferential allotment of shares to parties orcompanies covered in the register maintained under Section 301 of the Act. Accordingly,the provisions of clause 4(xviii) of the order ate not applicable to the Company.
(xix) The Company did not create any security in respect of the debenture issued, thisclause is not applicable to the company.
(xx) The Company has not raised any money by public issues during the year.Accordingly, the provisions of clause 4(xx) of the Order are not applicable to theCompany.
(xxi) No fraud on or by the Company has been noticed of reported during the year.
| ||FOR MANOJ SANGEETA & ASSOCIATES |
| ||Chartered Accountant |
| ||Sd/- |
| ||MANOJ KUMAR |
|Place : New Delhi ||Chartered Accountant |
|Dates : 02.08.2011 ||M.NO-098161 |