Mar 31, 2014
We have audited the accompanying financial statements of CLASSIC
DIAMONDS (INDIA) LIMITED ("the Company"), which comprise the Balance
Sheet as at 31st March, 2014, the Statement of Profit and Loss and the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
The 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 Section 211(3C) of the
Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal control relevant to
the preparation and fair presentation of the financial statements that
are free from material misstatement, whether due to fraud or error.
Auditors'' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit in accordance with the Standards on
Auditing issued by the Institute of Chartered Accountants of India.
However, because of the matters described in the Basis for Disclaimer
of Opinion paragraph below, we were not able to obtain sufficient
appropriate audit evidence to provide a basis for an audit opinion.
Basis for Disclaimer of Opinion
1. We could not observe the counting of physical inventories in the
absence of information available and restriction placed by the
Management Accordingly, we were unable to satisfy ourselves by
alternative means concerning the inventory quantities held at 31st
March, 2013 and 31st March, 2014 which are stated in the Balance Sheet
at Rs.44,11,593and Rs.44,11,593 respectively.
2. In addition, we were unable to confirm or verify by alternative
means balance of accounts receivableRs.2,957,822,918 and balance of
accounts payable Rs.244,505,890 and corresponding translation gain or
loss, if any on theses balance is not recorded for the year ended 31st
March, 2014 and same matters was reported in previous year.
3. We are also unable to confirm the bank balance (including working
capital facility and overdraft) and interest payable thereon since the
accounts are freezed by the consortium of banks and by income tax
authorities and as a result facility has been ceased to be operational
and same matter was reported in previous year,.
4. The Company has been unable to renegotiate its borrowings from its
bankers and also incurred loss in current year and previous year.
Wthout such financial support there is substantial doubt that it will
be able to continue as a going concern. Consequently, adjustments may
be required to the recorded asset amounts and classification of
liabilities. The financial statements (and notes thereto) do not
disclose this fact.
As a result of these matters, we were unable to determine whether any
adjustments might have been found necessary in respect of recorded or
unrecorded inventories, bank balance (including overdraft facilities)
and interest payable thereon and accounts receivable/payable and the
elements making up the Statement of Profit and Loss and the Cash Flow
Statement.
Disclaimer of Opinion
Because of the significance of the matters described in the Basis for
Disclaimer of Opinion paragraph above, we have not been able to obtain
sufficient appropriate audit evidence to provide a basis for an audit
opinion. Accordingly, we do not express an opinion on the aforesaid
financial statements.
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 in terms of Section 227(4A) 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) As described in the Basis for Disclaimer of Opinion paragraph
above, we were unable to obtain all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
(b) Due to the possible effects of the matters described in the Basis
for Disclaimer of Opinion paragraph above, we are unable to state
whether proper books of account 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, the Statement of Profit and Loss and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account except for fixed assets register and other matter as
referred in Basis for Disclaimer of Opinion
(d) Due to the possible effects of the matters described in the Basis
for Disclaimer of Opinion paragraph above, we are unable to state
whether the Balance Sheet, the Statement of Profit and Loss and the
Cash Flow Statement comply with the Accounting Standards referred to in
Section 211(3C) of the Act.
(e) We are unable to comment on compliance of Section 274(1)(g) of the
Act since none of the directors has submitted written representations
with regards to being appointed as a director in terms of Section
274(1)(g) of the Act and consequently the same not been taken on record
by the Board of Directors.
Annexure to Independent Auditors'' Report Referred to in paragraph under
the heading of "Report on Other Legal and Regulatory Requirements" of
our Report of even date
i. In respect of its fixed assets:
a) The company has not maintained proper records showing full
particulars including quantitative details and situation of its fixed
assets.
b) As explained to us, the fixed assets have not been physically
verified by the management during the year. Hence, we are unable to
comment on discrepancies between book record and physical assets.
c) In the absence of fixed assets register and physical verification
report of fixed assets we are unable to comment on disposal of fixed
assets
ii. In respect of its inventories:
a) As explained to us, the inventories other than those lying with
outside parties were physically verified during the year by the
management at reasonable intervals. However, records of such physical
verification were not made available to us for verification.
b) In our opinion and according to the information and explanations
given to us, we are unable to comment on the procedures of physical
verification in the absence of appropriate audit evidence.
c) In our opinion and on the basis of our examination of the records,
in the absence of appropriate audit evidence, we are unable to comment
on discrepancy on physical verification of stocks by the management if
any.
iii.
d) According to information and explanations given to us, 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. As the Company has not granted any loans, the clause
4(iii)(b), 4(iii)(c) and 4(iii)(d) of the Order are not applicable.
e) According to the information and explanations given to us, the
Company has not taken any loans, secured or unsecured, to / from
companies, firms or other parties listed in the Register maintained
under Section 301 of the Companies Act, 1956 except for interest free
loan from the Director and relative of director. The maximum amount
involved during the year was Rs. 2,49,409 and Rs. 89,313 respectively and
year-end balance is Rs.7,494 and Nil respectively.
f) In our opinion and according to information and explanations given
to us, in respect of such interest free unsecured loans taken by the
Company, the other terms and conditions are prima facie, not
prejudicial to the interest of the Company.
g) In respect of such loans taken by the Company, the principal amounts
were repayable on demand.
iv. In our opinion, and according to the information and explanations
given to us, there is an inadequate internal control system
commensurate with the size of the Company and there are no sale of
goods and services during the year. There are no purchases of
inventory and fixed assets during the year.
v. In respect of contracts or arrangements 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:
a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register maintained under the said
Section have been so entered.
b) Where each of such transaction is in excess of Rs. 5 lakh in respect
of any party, having regard to the explanation that some of the items
sold during the year where the suitable alternative sources are not
readily available for obtaining comparable quotations. Hence, we are
unable to comment on transactions have been made at prices which are
prima facie reasonable having regard to prevailing market prices at the
relevant time.
vi. According to the information and explanations given to us, the
Company has not accepted any deposit from the public during the year.
In respect of unclaimed deposits, the Company has complied with the
provisions of Sections 58A, 58AA or any other relevant provisions of
the Companies Act, 1956.
vii. According to the information and explanations given to us the
Company does not have internal audit system.
viii. The Central Government has not prescribed maintenance of cost
records under clause (d) of sub-section (1) of Section 209 of the
Companies Act, 1956 for trading activities. Accordingly, this para is
not applicable to the Company.
ix. According to the information and explanations given to us in
respect of statutory dues:
a) The Company has not deposited undisputed statutory dues, including
Provident Fund, Investor Education & Protection Fund, and Employees''
State Insurance, Income-tax, Sales-tax, Wealth-tax, Custom Duty, Excise
Duty, Cess and other material statutory dues applicable to it with
appropriate authorities.
b) There are undisputed amounts payable in respect of certain statutory
dues for a period of more than six months from the date they became
payable as given below:
Name of the statutory dues For the financial Amount (Rs.)
Year
Profession tax 2012-13 43,200
Employees contribution to ESIC Earlier years* 31,779
Employers contribution to ESIC Earlier years* 58,825
Income tax 2010-11 39,596,893
Wealth tax 2010-11 14,000
Property Tax 2011-12 132,270
Employees contribution to MLWF 2011-12 14,191
Value Added Tax 2012-13 309,693
Value Added Tax - Surat 2011-12 117,107
Value Added Tax - Maharashtra 2005-06 59,377,769
Value Added Tax - Maharashtra 2008-09 12,466,008
Value Added Tax - Maharashtra 2013-14 82,193
Value Added Tax - Maharashtra 2012-13 93,572
Value Added Tax - Maharashtra Earlier years* 216,806
Investor Education Protection Fund Earlier years* 10,385
year wise break up not available
c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Customs Duty, Excise Duty and Cess which have not been deposited as on
31March 2014 on account of disputes are given below:
Name of statute Nature of dues Forum Period to which
where the amount
dispute is relates pending
Income tax act, Disallowances CIT(A) F.Y. 2007-08
1961 of expenses
Income tax act, Disallowances CIT(A) F.Y. 2008-09
1961 of expenses
and deductions
Income tax act, Disallowances ITAT F.Y. 2009-10
1961 of expenses
and deductions
Name of Statute Amount involved (Rs.)
Income tax act, 1961 53,75,640
Income tax act, 1961 24,72,17,205
Income tax act, 1961 2,05,61,740
xi. Accumulated losses of the Company at the end of the financial year
are more than hundred percent of its net worth.
The Company has incurred cash losses during the current financial year
and in the immediately preceding financial year.
xii. In our opinion and according to the information and explanations
given to us, the company has defaulted in repayment of dues to banks
amounting to Rs.3,00,64,46,069/- in respect of loans repayable on
demand. Also, the Company has failed to repay the overdraft balance in
Current Accounts with the banks amounting to Rs.13,83,08,413/-.The
Company has not defaulted in repayment of dues to financial
institution. The Company has not issued any debentures and hence,
clause
(xi) so far as it related to debenture holders does not apply in the
case of the Company.
xiii. In our opinion and 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.
xiv. In our opinion, and according to the information and explanations
given to us, the nature of activities of the Company does not attract
any special statue applicable to chit fund and nidhi / mutual benefit
fund / societies. Accordingly, clause 4
(xiii) of the Order is not applicable to the Company. xv. In our
opinion, the Company is not dealing in or trading in shares,
securities, debentures or other investments. Accordingly, the
provisions of paragraph 4
(xiv) of the Order are not applicable to the Company.
xvi. In our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
corporate guarantees to banks or financial institutions on behalf of
associated concerns are prejudicial to the interests of the Company.
xvii. In our opinion and according to the information and explanations
given to us, the Company has not raised any term loan during the
current period consequently the para of the order is not applicable.
xviii. In our opinion and according to the information and
explanations given to us and on an overall examination of the Balance
Sheet, we are unable report on utilisation of short term fund for long
term purpose as referred in basis of disclaimer of opinion since we do
not have appropriate audit evidence for classification and
recoverability of certain amounts.
xix. The Company has not made any preferential allotment of shares to
parties or companies covered in the Register maintained under Section
301 of the Companies Act, 1956, during the year.
xx. The Company has not issued any debentures. Accordingly, clause
(xix) of paragraph 4 of the Order is not applicable in the case of the
Company.
xxi. The Company has not raised any money by public issue during the
year.
xxii. To the best of our knowledge and according to the information
and explanations given to us, no fraud by the Company and no material
fraud on the Company has been noticed or reported during the year.
For JMR & Associates
Chartered Accountants
Firm Reg. No. 106912W
Place: Mumbai (CA. Nikesh Jain)
Date : 30th May, 2014 Partner
Membership No: 114003
Mar 31, 2012
1. We have audited the attached Balance Sheet of CLASSIC DIAMONDS
(INDIA) LIMITED, Mumbai as at 31st March, 2012, 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.
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 (Auditor's Report) Order, 2003 as
amended by Companies (Auditor's 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,
and on the basis of the information and explanation given to us and the
books and records examined by us in the normal course of audit and to
the best of our knowledge and belief, 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 purpose of our
audit subject to our observations in Para 5 below;
(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 are, subject to our
observations in Para 6 below, in compliance with the Accounting
Standards referred to in Sub-section (3C) of Section 211 of the
Companies Act, 1956 to the extent applicable;
(e) On the basis of written representations received from the
Directors, as on 31st March, 2012 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
31st March, 2012 from being appointed as a director in terms of clau ð
(g) of sub-section (1) of section 274 of the Companies Act, 1956;
5. Note No.30 regarding lock-out at the Company's factory at SEEPZ and
consequential non- availability of books of accounts and other records
for the purpose of audit;
6. In our opinion and to the best of our information and according to
the explanations given to us, and subject to Para 5 above and:
I. Provision of Gratuity / Leave encashment not being provided on
actuarial basis, which is in non- compliance with the requirements of
Accounting Standard 15 'Employee Benefits' as specified in the
Companies (Accounting Standards) Rules, 2006. In the absence of an
actuarial valuation being made, we are unable to quantify the effect,
if any, on the profits of the company for the year ended 31st March,
2012. (Refer Note No.36).
ii. Note No.33 regarding change in method of accounting relating to
foreign exchange transactions; the year end assets and liabilities have
not been converted at closing rate which is in non- compliance with the
requirements of Accounting Standard 11 'Foreign Exchange transactions'
as specified in the Companies (Accounting Standards) Rules, 2006. Had
such conversion being made, the gross amount of debtors & creditors
(before giving netting off effect) would have been higher by Rs.
38,769.38 lakh and Rs. 30,938.77 lakh respectively and loss before tax
for the year would have been lower by Rs. 7,830.62 lakh.
The said accounts 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 Affairs of the
Company as at 31st March, 2012;
(b) in the case of Profit and Loss Account, of the Loss of the Company
for the year ended on that date; and
(c) in the case of Cash Flow Statement, of the Cash Flow for the year
ended on that date.
ANNEXURE TO THE AUDITORS' REPORT TO THE MEMBERS OF CLASSIC DIAMONDS
(INDIA)
LIMITED FOR THE YEAR ENDED 31ST MARCH, 2012
(Referred to in paragraph 3 of our report of even date)
i. In respect of its fixed assets:
a) The Company is in the process of compiling fixed assets records to
show full particulars, including quantitative details and situation of
fixed assets.
b) Physical verification of fixed assets was carried out by the
management, but since fixed assets records are still under compilation,
no comparison with book records has yet been made.
c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
ii. In respect of its inventories:
a) As explained to us, the inventories other than those lying with
outside parties were physically verified during the year by the
management at reasonable intervals. However, records of such physical
verification were not made available to us for verification.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) Since inventory verification records were not available for
verification, we are unable to determine whether the Company has
maintained proper records of its inventories and whether material
discrepancies were noticed on physical verification.
iii. According to the information and explanations given to us, the
Company has, neither granted nor taken any loans, secured or unsecured,
to / from companies, firms or other parties listed in the Register
maintained under Section 301 of the Companies Act, 1956. Accordingly,
sub-clauses (a), (b), (c), (d), (e), (f) and (g) of the order, are not
applicable in the case of the Company.
iv. In our opinion, and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
Company and the nature of its business with regard to purchases of
inventory and fixed assets and the sale of goods and services. During
the course of our audit, we have not observed any major weakness in
such internal control system.
v. In respect of contracts or arrangements 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:
a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register maintained under the said
Section have been so entered.
b) Where each of such transaction is in excess of Rs. 5 lakh in respect
of any party, having regard to the explanation that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, the
transactions have been made at prices which are prima facie reasonable
having regard to prevailing market prices at the relevant time.
vi. According to the information and explanations given to us and in so
far as it appears from our audit, the Company has not accepted any
deposits from the public. Accordingly, clause (vi) of paragraph of the
order is not applicable in the case of the Company.
vii. The company does not have a formal internal audit system. However,
its internal control procedures ensure internal checking of financial
records which in our opinion is reasonable under the circumstances
having regard to the nature of the business and size of the Company.
viii. As informed, the Central Government has not prescribed
maintenance of cost records under clause (d) of sub-section (1) of
Section 209 of the Companies Act, 1956.
ix. According to the information and explanations given to us in
respect of statutory dues:
a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Investor Education &
Protection Fund, and Employees' State Insurance, Income- tax,
Sales-tax, Wealth-tax, Service tax, Value Added Tax, Custom Duty,
Excise Duty, Cess and other material statutory dues applicable to it
with appropriate authorities.
b) There were no undisputed amounts payable in respect of Income-tax,
Wealth-tax, Custom Duty, Excise Duty, Cess and other material statutory
dues in arrears as at 31st March, 2012 for a period of more than six
months from the date they became payable except Income Tax relating to
Assessment Year 2011-12 amounting to Rs.401.35lakh.
x. The Company does not have accumulated losses as at 31st March 2012.
The Company has incurred cash losses during financial year ended on
that date. However, no cash losses were incurred 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 banks
amounting to Rs. 28,736.89 lakh in respect of loans repayable on demand.
The Company has not defaulted in repayment of dues to financial
institution. The Company has not issued any debentures and hence clause
(xi) so far as it related to debenture holders does not apply in the
case of the Company.
xii. In our opinion and 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.
xiii. The provisions of any special statute as specified under clause
(xiii) of the said Order are not applicable to the Company.
xiv. In our opinion, the Company is not dealing in or trading in
shares, securities, debentures or other investments. Accordingly, the
provisions of paragraph 4 (xiv) of the Order are not applicable to the
Company.
xv. In our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
corporate guarantees to banks or financial institutions on behalf of
associated concerns are not prejudicial to the interests of the
Company.
xvi. In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
xvii. In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short term basis have not been used during
the year for long term investments.
xviii. The Company has not made any preferential allotment of shares to
parties or companies covered in the Register maintained under Section
301 of the Companies Act, 1956, during the year.
xix. The Company has not issued any debentures. Accordingly, clause
(xix) of paragraph 4 of the Order is not applicable in the case of the
Company.
xx. The Company has not raised any money by public issue during the
year.
xxi. During the course of 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 significant
fraud on or by the Company, noticed or reported during the year nor
have we been informed of such case by management.
For APTE & CO.
Chartered Accountants Firm
Reg.No.lll925W
(Dr. JayantApte)
Place: Mumbai Partner
Date: 14th August, 2012 Membership No: 035494
Mar 31, 2011
1. We have audited the attached Balance Sheet of CLASSIC DIAMONDS
(INDIA) LIMITED, Mumbai as at 31th March, 2011, 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.
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 (Auditor's Report) Order, 2003 as
amended by Companies (Auditor's 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,
and on the basis of the information and explanation given to us and the
books and records examined by us in the normal course of audit and to
the best of our knowledge and belief, 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 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
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 are in compliance with the
Accounting Standards referred to in Sub-section (3C) of Section 211 of
the Companies Act, 1956 to the extent applicable; except regarding
provision of Gratuity / Leave encashment not being provided on
actuarial basis, therefore we are unable to quantify the effect, if
any, on the profits of the company for the year ended 31th March 2011.
(Refer Note No. B-7 of Schedule XV).
e. On the basis of written representations received from the
Directors, as on 31st March, 2011 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
31st March, 2011 from being appointed as a director in terms of clause
(g) of sub-section (I) of section 274 of the Companies Act, 1956;
f. Subject to our comment in Para 4(d) above, in our opinion and to
the best of our information and according to the explanations given to
us, the said accounts 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 Affairs of the
Company as at 31st March, 2011 ;
b) in the case of Profit and Loss Account, of the Profit of the Company
for the year ended on that date; and
c) in the case of Cash Flow Statement, of the Cash Flow for the year
ended on that date.
ANNEXURETOTHE AUDITORS' REPORT TO THE MEMBERS OF CLASSIC DIAMONDS
(INDIA)
LIMITED FOR THE YEAR ENDED 31st MARCH, 2011
(Referred to in paragraph 3 of our report of even date)
1 (a) Fixed Assets records showing full particulars, including
quantitative details and situation of fixed assets are being compiled
by the company.
(b) Fixed assets have not been physically verified by the management
during the year.
(c) No disposal of substantial part of the fixed assets of the company
has taken place during the year.
2 (a) The inventories, other than those lying with outside parties have
been physically verified by the management. In our opinion,
the frequency of verification is reasonable.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
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 records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material in relation to
the operations of the Company and the same have been properly dealt
with in the books of account.
3. According to the information and explanation given to us, the
Company has, during the year, neither granted nor taken any loan
secured or unsecured to / from companies, firms and other parties
covered in the register maintained Under Section 301 of the Companies
Act, 1956. Accordingly, paragraphs 4(iii) (a), (b), (c) ,(d), (e), (f)
and (g) of the order, not applicable.
4. In our opinion, and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory and fixed assets and die sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal controls.
5 (a) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that the particulars of contracts and arrangements that need to
be entered in the register maintained in section 301 of the Companies
Act, 1956 have been so entered. (b) The Company is dealing in the
items which requires technical appraisal and expertise in determining
prevailing market prices as on the date of transaction and in the
absence of required information and records, we are unable to express
the opinion in respect of transactions made in pursuance of contracts
or arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956, with regards to prices which are reasonable
having regard to prevailing market prices at the relevant time.
6. During the year the Company has not accepted any deposits to which
provisions of Section 58A, 58AA or any other relevant provisions of the
Companies Act, 1956 and the rules framed there under would apply.
7. The company did not have any independent internal auditor during
the year. We are informed that the company is in the process of
appointment an internal auditor. However, according to the information
and explanation given to us, the company has an internal audit system,
which is commensurate with the size of the company and nature of its
business.
8. The Central Government has not prescribed maintenance of cost
records under Section 209(I)(d) of the Companies Act, 1956 for any of
the products of the Company.
9 (a) According to the information and explanations given to us, and
verification of records of the Company, the Company is regular in
depositing with appropriate authorities undisputed statutory dues,
including Provident Fund, Investor Education Protection Fund,
Employees' State Insurance, Income-tax, Sales-tax, Wealdi-tax, Service
tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable
to it. According to the information and explanations given to us, there
are no undisputed amounts payables in respect of the aforesaid dues as
at 31st March, 2011.
(b) According to the records of the company and information and
explanation given to us, there are no disputed dues pending / payable
of Income Tax, Sales Tax, Wealth Tax, ServiceTax, Custom Duty, Excise
Duty, Cess as on 31th March 2011.
10. The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the Management, we are of the opinion that the
Company has not defaulted in repayment of dues to any bank or financial
institution. The Company has not issued any debentures.
12. The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The Company is not carrying the chit fund business; hence, the
provisions of any special statute applicable to chit fund are not
applicable.
14. The Company is not dealing in or trading in shares, securities,
debentures or other investments.
15. In our opinion, terms and conditions on which the Company has
given corporate guarantees to banks on behalf of Associated concerns,
are not prima facie prejudicial to the interest of the Company.
16. On the basis of the review of the utilization of funds pertaining
to term loans on overall basis and related information as made
available to us by the Company, prima facie, the term loans taken by
the Company were applied for the purpose for which they had been
raised.
17. According to Cash flow statements and other records examined by us
and on the basis of the information and explanation given to us, on
overall basis we report that funds raised on short term basis have not
been used for long term investments by the company.
18. The Company has made preferential allotment of shares to parties
or companies covered in the Register maintained under section 301 of
the Companies Act, 1956, However, the price at which shares have been
issued is not prejudicial to the interest of the company.
19. During the year, the Company has not issued any debentures.
20. During the year, the Company has not raised money by public
issue(s).
21. Based upon the audit procedures performed and information and
explanations given by the management, we report that no fraud on or by
the Company has been noticed or reported during the course of our
audit.
For Apte & Co.
Chartered Accountants
Jayant Apte
Partner
Membership No: 035494
Place: Mumbai
Date: 11th August, 2011
Mar 31, 2010
1. We have audited the attached Balance Sheet of CLASSIC DIAMONDS
(INDIA) LIMITED, Mumbai as at 31st March, 2010, 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 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 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,
and on the basis of the information and explanation given to us and the
books and records examined by us in the normal course of audit and to
the best of our knowledge and belief, 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 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 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 are in compliance with the
Accounting Standards referred to in Sub-section (3C) of Section 211 of
the Companies Act, 1956 to the extent applicable; except regarding
provision of Gratuity / Leave encashment not being provided on
actuarial basis, therefore we are unable to quantify the effect, if
any, on the profits of the company for the year ended 31st March 2010.
(Refer Note No. B-7 of Schedule XV).
e. On the basis of written representations received from the Directors,
as on 31st March, 2010 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March,
2010 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956;
f. Subject to our comment in Para 4(d) above, in our opinion and to the
best of our information and according to the explanations given to us,
the said accounts 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 Affairs of the
Company as at 31 st March, 2010;
b) in the case of Profit and Loss Account, of the Profit of the Company
for the year ended on that date; and c)in the case of Cash Flow
Statement, of the Cash Flow for the year ended on that date.
ANNEXURE TO THE AUDITORS REPORT TO THE MEMBERS OF CLASSIC DIAMONDS
(INDIA) LIMITED FOR THE YEAR ENDED 31 ST MARCH, 2010
(Referred to in paragraph 3 of our report of even date)
1 (a) Fixed Assets records showing full particulars, including
quantitative details and situation of fixed assets are being compiled
by the company.
(b) Fixed assets have not been physically verified by the management
during the year.
(c) No disposal of substantial part of the fixed assets of the company
has taken place during the year.
2(a) The inventories, other than those lying with outside parties have
been physically verified by the management. In our opinion, the
frequency of verification is reasonable.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
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 records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material in relation to
the operations of the Company and the same have been properly dealt
with in the books of account.
3. According to the information and explanation given to us, the
Company has, during the year, neither granted nor taken any loan
secured or unsecured to / from companies, firms and other parties
covered in the register maintained Under Section 301 of the Companies
Act, 1956. Accordingly, paragraphs 4(iii) (a), (b), (c) ,(d), (e), (f)
and (g) of the order, not applicable.
4. In our opinion, and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory and fixed assets and the sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal controls.
5 (a) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that the particulars of contracts and arrangements that need to
be entered in the register maintained in section 301 of the Companies
Act, 1956 have been so entered. (b) The Company is dealing in the
items which requires technical appraisal and expertise in determining
prevailing market prices as on the date of transaction and in the
absence of required information and records, we are unable to express
the opinion in respect of transactions made in pursuance of contracts
or arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956, with regards to prices which are reasonable
having regard to prevailing market prices at the relevant time.
6. During the year the Company has not accepted any deposits to which
provisions of Section 58A, 58AA or any other relevant provisions of the
Companies Act, 1956 and the rules framed there under would apply.
7. The company did not have any independent internal auditor during
the year. We are informed that the company is in the process of
appointment an internal auditor. However, according to the information
and explanation given to us, the company has an internal audit system,
which is commensurate with the size of the company and nature of its
business.
8. The Central Government has not prescribed maintenance of cost
records under Section 209(1 )(d) of the Companies Act, 1956 for any of
the products of the Company.
9 (a) According to the information and explanations given to us, and
verification of records of the Company, the Company is regular in
depositing with appropriate authorities undisputed statutory dues,
including Provident Fund, Investor Education Protection Fund,
Employees State Insurance, Income-tax, Sales-tax, Wealth-tax, Service
tax, Custom Duty, Excise Duty, Cess and other statutory dues applicable
to it. According to the information and explanations given to us, there
are no undisputed amounts payables in respect of the aforesaid dues as
at 31st March, 2010.
(b) According to the records of the company and information and
explanation given to us, there are no disputed dues pending / payable
of Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise
Duty, Cess as on 31st March 2010.
10. The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the Management, we are of the opinion that the
Company has not defaulted in repayment of dues to any bank orfinancial
institution. The Company has not issued any debentures.
12. The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The Company is not carrying the chit fund business; hence, the
provisions of any special statute applicable to chit fund are not
applicable.
14. The Company is not dealing in or trading in shares, securities,
debentures or other investments.
15. In our opinion, terms and conditions on which the Company has
given corporate guarantees to banks on behalf of Associated concerns,
are not prima facie prejudicial to the interest of the Company.
16. On the basis of the review of the utilization of funds pertaining
to term loans on overall basis and related information as made
available to us by the Company, prima facie, the term loans taken by
the Company were applied for the purpose for which they had been
raised.
17. According to Cash flow statements and other records examined by us
and on the basis of the information and explanation given to us, on
overall basis we report that funds raised on short term basis have not
been used for long term investments by the company.
18. The Company has made preferential allotment of shares to parties
or companies covered in the Register maintained under section 301 of
the Companies Act, 1956. However, the price at which shares have been
issued is not prejudicial to the interest of the company.
19. During the year, the Company has not issued any debentures.
20. During the year, the Company has not raised money by public
issue(s).
21. Based upon the audit procedures performed and information and
explanations given by the management, we report that no fraud on or by
the Company has been noticed or reported during the course of our
audit.
For A. N. Damania & Co.
Chartered Accountants
Ashvin Damania
Place: Mumbai Proprietor
Date: 11th August, 2010 Membership No: 40166
Firm Reg.No.:102077W
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