AUDITOR
To
The Members of
Ashco Niulab Industries Limited,
1. We have audited the attached Balance Sheet of Ashco Niulab Industries Limited as
at 31st March, 2012 and also the Statement of Profit and Loss and the Cash Flow Statement
of the Company for the six months period ended on that date annexed thereto. These
financial statements are the responsibility of the management of the Company. Our
responsibility is to express an opinion on these financial statements based on our audit.
2. We have 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 the 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 (the Order), issued by the Central
Government of India in terms 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 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, Statement of Profit and Loss and Cash Flow Statement dealt with
by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement comply with the mandatory Accounting Standards referred to in subsection 3C of
Section 211 of the Companies Act, 1956, except for non-provision of gratuity liability and
leave encashment, which is not as per AS-15 "Employee Benefits"
e) On the basis of written representations received from the directors and taken on
record by the Board of Directors, we report that none of the said directors is
disqualified as on 31st March, 2012 from being appointed as directors of the Company under
clause (g) of sub-section (1) of Sec 274 of the Companies Act, 1956;
f) In our opinion and to the best of our information and according to the explanations
given to us, the said Accounts read together with the Notes thereon give the information
required by the Companies Act, 1956 in the manner so required and subject to Note No.2.1
(ii) of the Notes to the Accounts for non provision of gratuity liability and leave
encashment as the same is accounted for on cash basis 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 31st
March, 2012;
ii) in the case of the Statement of Profit and Loss , of the loss of the Company for
the six months period ended on that date
and
iii) in the case of Cash Flow Statement, of the cash flows for the six months period
ended on that date.
|
For GMJ & Co |
|
Chartered Accountants |
|
FRN No. 103429W |
|
CA S.MAHESHWARI |
|
Partner |
|
M. No. 38755 |
| Place : Mumbai |
|
| Date : 5th January, 2013 |
|
ANNEXURE TO THE AUDITORS REPORT OF ASHCO NIULAB INDUSTRIES LIMITED FOR THE PERIOD
ENDED ON 31st MARCH, 2012 (Referred to in paragraph 3 of our Report of Even Date)
i. (a) The Company has maintained proper records showing major particulars including
quantitative details and situation of fixed assets.
(b) All the assets have not been physically verified by the management during the
period but there is a regular programme of verification by the management at reasonable
intervals. In our opinion the frequency of verification may be increased. No material
discrepancies were noticed on such verification by the management.
(c) In our opinion, the Company has not disposed off substantial part of Fixed Assets
during the period.
ii. (a) We are informed that the management has a regular programme of physical
verification of inventories. In our opinion the frequency of verification may be
increased.
(b) The procedures of physical verification of inventories followed by the management
needs to be strengthened significantly in relation to the size of the Company and the
nature of its business.
(c) The Company is maintaining proper records of inventory. We are informed that the
discrepancies noticed on verification between the physical stocks and the book records
were not material.
iii. (a) The Company has granted an advance of Rs. 50,92,13,465/- to wholly owned
subsidiary company covered in the register maintained under Section 301 of the Companies
Act, 1956. The maximum amount involved during the period was Rs.50,92,13,465/- and the
year-end balance of advance given to such party was Rs. 50,92,13,465/-.
(b) In our opinion and according to the information and explanations given to us, the
terms and conditions of interest free advance given by the Company, are prima facie not
prejudicial to the interest of the Company.
(c) The Company had taken unsecured loans from two parties covered in the register
maintained under Section 301 of the Companies Act 1956. The maximum amount involved during
the period was Rs. 2,13,67,534/- and the year-end balance of loan taken from such parties
was Rs. 1,93,39,799/-.
(d) In our opinion and according to the information and explanations given to us, the
terms and conditions of interest free unsecured loans taken by the Company, are prima
facie not prejudicial to the interest of the Company.
(e) The Company is regular in repaying the principal amount wherever stipulated.
iv. In our opinion and according to the information and explanations given to us, the
internal control systems need to be significantly strengthened to be commensurate with the
size of the Company and the nature of its business, for the purchase of inventory and
fixed assets and for the sale of goods and services. During the course of our audit, no
continuing failure to correct major weakness in the internal control system has been
noted.
v. (a) According to the information and explanations 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 have been entered in the register required to be maintained under that
section.
(b) In our opinion and according to the information and explanations given to us, there
were no transactions made in pursuance of contracts or arrangements entered in the
Register maintained under section 301 of the Companies Act, 1956, aggregating Rs.
5,00,000/- or more during the period.
vi. In our opinion and according to the information and explanations given to us, the
Company has not accepted deposits from public, and consequently the directives issued by
the Reserve Bank of India and the provisions of sections 58A, 58AA or any other relevant
provisions of the Companies Act, 1956 and the rules framed there under are not applicable
to the Company.
Vii The Company presently has no separate internal audit system. It has an internal
control system which needs to be significantly strengthened to be commensurate with the
size and nature of its business.
viii. According to the information and explanations given to us, the maintenance of
cost records has not been prescribed by the Central Government under clause (d) of sub
section 1 of Section 209 of the Companies Act, 1956, and hence, the provisions of clause
(viii) of paragraph 4 of the Companies (Auditors Report) Order, 2003 are not applicable
to the Company.
ix. (a) The Company is irregular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees State Insurance,
Income-Tax, Wealth Tax, Customs Duty, Excise Duty, Cess and any other statutory dues with
the appropriate authorities. Further, Service Tax, Profession Tax and Tax Deducted at
Source which are outstanding as at the last day of the financial period concerned for a
period of more than six months from the date they became payable are furnished below:
| Nature of Dues |
Amount in Rs. |
| Service Tax |
2,64,26,652 |
| Sales Tax |
52,63,905 |
| Tax Deducted at Source |
22,52,702 |
| Provident Fund |
27,22,284 |
| ESIC |
7,61,197 |
| Profession Tax |
2,89,015 |
| Labour Welfare Fund |
2,208 |
| Total |
3,77,17,963 |
(b) According to the information and explanations given to us, there are no dues of
Income Tax/ Sales Tax/ Wealth Tax/ Service Tax/ Custom Duty/ Excise Duty/ Cess which have
not been deposited on account of any dispute and hence the provisions of clause (ix) (b)
of paragraph 4 of the Companies (Auditors Report) Order, 2003 are not applicable to the
Company.
x. The accumulated losses of the company are not more than fifty percent of its net
worth. The company has incurred cash losses during the financial period and in the
immediately preceding financial period.
xi. The company has defaulted in repayment of dues to Financial Institutions and Banks.
The company has not issued any debentures. The period and amount of default are as under:
| Name of Bank / Institution |
Over dues Interest |
Over dues Principle |
Month Pending |
| SIDBI |
2,07,330 |
40,50,000 |
Jan-12 to Mar-12 |
| Punjab National Bank - Term Loan |
12,76,442 |
25,00,000 |
Jan-12 to Mar-12 |
| Punjab National Bank - Term Loan |
10,63,984 |
25,00,000 |
Jan-12 to Mar-12 |
| Citi Bank -Home Loan |
2,00,647 |
86,982 |
Mar-12 |
| Total |
27,48,403 |
91,36,982 |
|
xii. In our opinion and according to information and explanations given to us, the
Company has not granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities, and hence, the provisions of clause (xii) of
paragraph 4 of the Companies (Auditors Report) Order, 2003 are not applicable to the
Company.
xiii. In our opinion and according to information and explanations given to us, the
Company is not a chit fund or a nidhi/mutual benefit fund/society and hence the provisions
of clause (xiii) of paragraph 4 the Companies (Auditors Report) Order, 2003 are not
applicable to the Company.
xiv. In our opinion, the Company is not dealing or trading in shares, securities,
debentures and other investments. All the shares, securities, debentures and other
investments have been held by the Company, in its own name.
xv. In our opinion and according to information and explanations given to us, the
Company has not given any guarantees for the loans taken by others from banks or financial
institutions, and hence the provisions of clause (xv) of paragraph 4 the Companies
(Auditors Report) Order, 2003 are not applicable to the Company.
xvi. According to the information and explanations given to us, the term loans availed
in the recent past have been applied for the purpose for which they were obtained.
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 by the Company.
xviii. The Company has not made any preferential allotment of shares to parties and
companies covered in the Register maintained under Section 301 of the Companies Act, 1956.
xix The Company has not issued any debentures and hence the provisions of clause (xix)
of paragraph 4 the Companies (Auditors Report) Order, 2003 are not applicable to the
Company.
xx. The Company has raised an amount of Rs. 33,77,95,000/-by issue of GDR in April,
2010. The management has invested the proceeds in the wholly owned subsidiary Ashco Niulab
FZE.
xxi. According to the information and explanations given to us, no fraud on or by the
Company has been noticed or reported during the year.
|
For GMJ & Co |
|
Chartered Accountants |
|
FRN No. 103429W |
|
CA S.MAHESHWARI |
| Place : Mumbai |
Partner |
| Date : 5th January, 2013 |
M. No. 38755 |
+91-9892691696
