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Auditor Report of EIH Associated Hotels Ltd.

Mar 31, 2015

Report on the Financial Statements

We have audited the accompanying financial statements of EIH Associated Hotels Limited ("the Company"), which comprise the Balance sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date, audited by the branch auditors of the Company's branch at Cochin.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these financial statements on a going concern basis that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and consistent application of appropriate accounting policies and making judgements and estimates that are reasonable and prudent, and design, implementation and maintenance of adequate internal financial controls, that operate effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

Other Matters

We did not audit the financial statements of Cochin branch included in the financial statements of the Company whose financial statements reflect total assets of Rs. 295.62 million as at 31st March, 2015 and total revenue of Rs. 108.55 million for the year ended on that date, as considered in the financial statements. The financial statements of this branch have been audited by the branch auditors whose report has been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of this branch, is based solely on the report of such branch auditors.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013 ('the Act'), we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the said order.

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and 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 it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branch not visited by us.

(c) The report on the account of branch office of the Company audited under section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

(d) 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 and with the returns received from the branch not visited by us.

(e) In our opinion, the aforesaid financial statements comply with the Accounting standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(f) On the basis of written representations received from the Directors as on 31st March, 2015 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2015 from being appointed as a Director in terms of section 164(2) of the Act.

(g) We respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigation on its financial position in its financial statements in respect of claims and demands on the Company which are being contested as mentioned in Note 28(a).

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There has been no delay in transferring amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE TO AUDITORS' REPORT

The Annexure referred to in paragraph 1 under the heading 'Report on other Legal and Regulatory Requirements' of our report at even date

i (a) The Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) Some fixed assets of the Company have been physically verified by the management during the year as a part of a regular programme of verification which, in our opinion is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification which were not material have been properly dealt with in the books of accounts.

ii (a) As explained to us, the inventories have been physically verified by the Management during the year at reasonable intervals. 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) 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.

iii the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Consequently, clauses [iii](a) and (b) of paragraph 3 of the aforesaid order are not applicable.

iv In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system of the Company.

v In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year.

vi the Central Government has not prescribed maintenance of cost records under section 148(1) of the Act for the Company.

vii (a) the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-tax, Sales-tax/Value Added tax, Wealth-tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income tax, Wealth tax, Sales tax/Value Added tax, Duty of Customs, Service tax, Excise duty and Cess and other statutory dues which were outstanding as at 31st March, 2015 for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of Income tax, Sales tax/Value Added tax, Wealth tax, Service tax, Duty of Customs, Excise duty and Cess which have not been deposited as at 31st March, 2015 on account of any dispute other than the disputed Income tax, Sales tax/Value Added tax, Service tax, Luxury tax and Excise duty as indicated below:

Name of the Nature of Amount Period to which the statute the dues in amount relates Millions

Tamil Nadu Tax Luxury Tax 14.55 2007-2008 to on Luxuries Act, 2011-2012 1981

The Himachal Luxury Tax 2.50 2008-2009 to Pradesh Tax 2011-2012 on Luxuries (in hotels & lodging houses) Act, 1979

Rajasthan Tax Luxury Tax 12.54 2010-2011 to on Luxuries 2013-2014 (In Hotels and Lodging House) Act, 1990 Central Excise Excise 0.08 2006-2007 to Act, 1944 Duty 2007-2008

Value Added Tax Value 0.12 2007-2008 on various states Added Tax

Value 1.02 1996-1997, 1997-1998, Added Tax 2010-2011

Value 0.56 1996-1997, 1997-1998, Added Tax 1999-2000

Value 6.45 2006-2007 to Added Tax 2011-2012

Value 4.95 2011-2012 to Added Tax 2013-2014 (VAT) on Service Tax

Value 7.17 2011-2012 to Added Tax 2013-2014 (VAT) on Service Tax

Value 5.85 2011-2012 to Added Tax 2013-2014 (VAT) on Service Tax

Service Tax Service Tax 0.18 2007-2008 to 2012-2013

Service Tax 1.23 2005-2008

Service Tax 8.48 2010-2011

Service Tax 28.03 2011-2012

Service Tax 14.19 April, 2008 to September, 2011

Service Tax 17.64 May, 2011 to March, 2012

Service Tax 2.32 April, 2012 to June, 2012

Service Tax 0.29 July, 2012 to March, 2013

Income Tax Income Tax 17.16 2007-2008, 2009-2010 Act, 1961 to 2011-2012

Name of the Forum where statute pending Tamil Nadu Tax Assistant on Luxuries Act, Commissioner, 1981 Chennai

The Himachal Himachal Pradesh Pradesh Tax High Court on Luxuries (in hotels & lodging houses) Act, 1979

Rajasthan Tax Additional on Luxuries Commissioner (In Hotels and (Appeals) Lodging House) Commercial Taxes Act, 1990 Udaipur Central Excise CESTAT Delhi Act, 1944

Value Added Tax Allahabad High on various states Court

VAT Commissioner, Agra

Orissa High Court and VAT Tribunal, orissa

Assistant Commissioner and Deputy Commissioner Chennai

Deputy Commissioner (Appeals), Commercial Taxes, Jaipur

Additional Commissioner (Appeals), Commercial Taxes, udaipur

Deputy Commissioner (Appeals), Commercial Taxes, Jaipur

Service Tax The Company is in the process of filing an appeal before the Commissioner Service Tax, Agra

Commissioner, Service Tax, Chennai

Commissioner, Service Tax, Chennai

CESTAT, Delhi

CESTAT, Delhi CESTAT, Delhi Joint Commissioner, Service Tax, Jaipur

Joint Commissioner, Service Tax, Jaipur

Income Tax Commissioner Act, 1961 of Income Tax (Appeals)

d) According to the records of the Company the amount which was required to be transferred to Investor Education and Protection Fund has been transferred as per the requirement of clause (vii)(c) of paragraph 3 of this order.

viii The Company does not have accumulated losses and has not incurred any cash loss during the year covered by our Report and in the immediately preceding financial year.

ix In our opinion and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks. The Company has no debenture holder.

x According to the information and explanations given to us the Company has not given any guarantee for loans taken by others from bank or financial institutions during the year.

xi In our opinion and according to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were obtained.

xii According to the information and explanations given to us no material fraud on or by the Company have been noticed or reported during the course of our audit.

For RAY & RAY Chartered Accountants Firm's Registration Number 301072E

A.K. SHARMA New Delhi Partner 28th May, 2015 Membership Number 80085


Mar 31, 2013

Report on the Financial statements

We have audited the accompanying financial statements of EIH Associated Hotels Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial statements

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 sub-section (3C) of Section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and 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. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act 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, 2013;

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure of statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. As required by Section 227(3) of "the Act", 1956 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, 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 dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act;

e. on the basis of written representations received from the Directors as on 31st March, 2013 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2013 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Act;

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

Referred to in paragraph 1 under the heading ''Report on Other Legal and

Regulatory Requirements'' or our report of even date

i (a) The Company have maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification which were not material have been properly dealt with in the books of accounts.

(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 (a) As explained to us, inventories have been physically verified by the

Management during the year at reasonable intervals. 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) 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.

iii 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 Act. Consequently, clauses (iii)(a) to (iii)(g) of paragraph 4 of the aforesaid Order are not applicable to the Company.

iv In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system of the Company.

v (a) According to the information and explanations given to us, we are of the

opinion that the particulars of contracts or arrangements that need to be entered into the Register maintained under Section 301 of the Act have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the Register made under section 301 of the Act and exceeding the value of Rs. 5 lakhs in respect of each party during the year cannot be compared in absence of market quotations for similar items.

vi In our opinion and according to the information and explanations given to us, the Company has not accepted any deposit from the public during the year.

vii In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

viii The Central Government has not prescribed maintenance of cost records under section 209 (1)(d) of the Act for the Company.

ix (a) The Company is generally regular in depositing with appropriate

authorities undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, value added tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no undisputed amount payable in respect of income tax, wealth tax, service tax, value added tax/sales tax, customs duty, excise duty and cess which were outstanding as at 31st March, 2013 for a period of more than six months from the date they became payable.

x The Company does not have accumulated losses and has not incurred any cash loss during the year covered by our Report and in the immediately preceding financial year.

xi In our opinion and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks.

xii The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other similar securities.

xiii In our opinion and 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 (xiii) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xiv In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause (xiv) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xv 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 during the year.

xvi According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

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 investments.

xviii According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies/firms covered in the Register maintained under section 301 of the Act.

xix According to the information and explanations given to us, the Company has not issued debentures during the year under audit.

xx We have verified on the basis of the books of account and information and explanations given to us, the end use of money raised by the Rights Issue of Equity Shares during the year, as disclosed in Note 35.

xxi According to the information and explanations given to us no material fraud on or by the Company has been noticed or reported during the course of our audit.

For RAY & RAY

Chartered Accountants

Firm''s Registration Number 301072E

A.K. SHARMA

Kolkata Partner

29th May, 2013 Membership Number 80085


Mar 31, 2012

1. We have audited the attached Balance Sheet of EIH Associated Hotels Limited as at 31st March, 2012, the Statement of Profit and Loss and also the Cash Flow Statement for the year ended on that date annexed thereto, in which are incorporated the Branch Accounts audited by us. 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 the Companies (Auditor's Report Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 ('the Act') and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose 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:

(i) 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;

(ii) 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;

(iii) 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;

(iv) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act;

(v) 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 Clause (g) of sub-section (1) of Section 274 of the Act;

(vi) in our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with Notes 1 to 43 give the information required by the Act 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 the Statement of Profit and Loss, of the profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITOR'S REPORT

(Referred to in paragraph 3 of our report of even date)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) All the fixed assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification which were not material have been properly dealt with in the books of accounts.

(c) During the year no substantial parts of fixed assets have been disposed off by the Company.

ii. (a) The inventory has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion, 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) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of accounts.

iii. (a) 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.

(b) In view of our comments in Clause iii(a) above, Clauses iii(b), iii(c) and iii(d) of paragraph 4 of the aforesaid Order are not applicable to the Company.

(c) The Company has not taken any loan, secured or unsecured, during the year from companies, firms or other parties covered in the Register maintained under Section 301 of the Act.

(d) In view of our comment in paragraph iii(c) above, clauses iii(f) and iii(g) of paragraph 4 of the aforesaid Order are not applicable to the Company.

iv. 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, fixed assets and with regard to the sale of goods and services. Further, there is no continuing failure to correct major weaknesses in internal control system.

v. (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into the Register maintained under Section 301 of the Act have been so entered.

(b) According to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the Register maintained under Section 301 of the Act during the year cannot be compared in absence of market quotations for similar items.

vi. The Company has not accepted any deposit from the public during the year under Sections 58A and 58AA of the Act and the Companies (Acceptance of Deposits) Rules, 1975.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

viii. The Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Act for the Company.

ix. (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no dues of income tax, wealth tax, service tax, customs duty, excise duty and cess which have not been deposited on account of any dispute other than the disputed sales tax as indicated below:

Sl. No. Name of the Nature of the Forum where Amount statute dues dispute is (Rupees in pending Millions)

1 Sales Tax:

a) Orissa Sales Sales Tax i) Sales Tax Tax Act Tribunal, Orissa 0.39

ii) Orissa High Court 0.31

b) Uttar Pradesh Sales Tax Uttar Pradesh Commercial Commercial Tax Tax Act Appellate Authority 0.50

Total 1.20

x. The Company has no accumulated losses and has not incurred any cash loss during the year covered by our Report and the immediately preceding financial year.

xi. Based on our audit procedures and, according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks.

xii. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other similar securities.

xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. Therefore, the provisions of Clause (xiii) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xiv. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause (xiv) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xv. The Company has no guarantee outstanding as regards loan taken by the Subsidiary Company. Accordingly the provisions of Clause (xv) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xvi. According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

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 investments.

xviii. The Company has not raised any money by issue of shares during the year. Therefore, the provisions of Clause (xviii) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xix. The Company has not issued debentures during the year under audit. Accordingly, the provisions of Clause (xix) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xx. The Company has not raised any money by way of public issue during the year. Therefore, the provisions of Clause (xx) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xxi. During the course of our examination of the books of account carried out in accordance with Generally Accepted Auditing Practices, we have neither come across any instance of fraud on or by the Company nor have we been informed of any such case by the Management.

For RAY & RAY

Chartered Accountants

R.N. ROY

Partner

Gurgaon Membership Number 8608

28th May, 2012 Firm's Registration Number 301072E


Mar 31, 2011

1. We have audited the attached Balance sheet of eIH Associated Hotels Limited as at 31st March, 2011, the Proft and Loss Account and also the Cash Flow statement for the year ended on that date annexed thereto, in which are incorporated the Branch Accounts audited by us. 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 signifcant 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 the Companies (Auditors Report Amendment) order, 2004, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 (the Act) and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the annexure a statement on the matters specifed 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:

(i) 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;

(ii) 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;

(iii) the Balance sheet, Proft and 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, Proft and Loss Account and Cash Flow statement dealt with by this report comply with the Accounting standards referred to in sub-section (3C) of section 211 of the Act;

(v) 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 disqualifed as on 31st March, 2011 from being appointed as a Director in terms of Clause (g) of sub-section (1) of section 274 of the Act;

(vi) in our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with schedules 1 to 23 give the information required by the Act 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 the Proft and Loss Account, of the proft for the year ended on that date; and

(c) in the case of the Cash Flow statement, of the cash fows for the year ended on that date.

annexure to the auditors report (Referred to in paragraph 3 of our report of even date)

i. (a) the Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verifed by the Management during the year but there is a regular programme of verifcation which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. the discrepancies noticed on such verifcation are being reconciled.

(c) During the year no substantial part of fixed assets have been disposed off by the Company.

ii. (a) the inventory has been physically verifed by the Management during the year. In our opinion, the frequency of verifcation is reasonable.

(b) In our opinion, the procedures of physical verifcation 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) the Company is maintaining proper records of inventory. the discrepancies noticed on verifcation between the physical stocks and the book records were not material.

iii. (a) the Company has not granted any loans, secured or unsecured, to companies, frms or other parties covered in the Register maintained under section 301 of the Act.

(b) In view of our comments in Clause iii(a) above, Clauses iii(b), iii(c) and iii(d) of paragraph 4 of the aforesaid order are not applicable to the Company.

(c) the Company has not taken any loan, secured or unsecured, during the year from companies, frms or other parties covered in the Register maintained under section 301 of the Act. However, during the year the Company has repaid the loan taken from a Company (Maximum balance - Rs. 320 Million)

(d) In view of our comment in paragraph iii(c) above, clauses iii(f) and iii(g) of paragraph 4 of the aforesaid order are not applicable to the Company.

iv. 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, fixed assets and with regard to the sale of goods and services. Further, there is no continuing failure to correct major weaknesses in internal control system.

v. (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into the Register maintained under section 301 of the Act have been so entered.

(b) According to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the Register maintained under section 301 of the Act during the year cannot be compared in absence of market quotations for similar items.

vi. the Company has not accepted any deposit from the public during the year under sections 58A and 58AA of the Act and the Companies (Acceptance of Deposits) Rules, 1975.

vii. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

viii. the Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Act for the Company.

ix. (a) the Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no dues of income tax, wealth tax, service tax, customs duty, excise duty and cess which have not been deposited on account of any dispute other than the disputed sales tax as indicated below:

sl. no. name of the nature of the Forum where Amount statute dues dispute is (Rupees in pending Millions)

1 sales tax:

a) orissa sales sales tax i) sales tax tax Act tribunal, orissa 0.39

ii) orissa High Court 0.31

b) uttar Pradesh sales tax uttar Pradesh Commercial Commercial tax tax Act Appellate Authority 8.90

total 9.60

x. the Company has no accumulated losses and has not incurred any cash loss during the year covered by our Report and the immediately preceding fnancial year.

xi. Based on our audit procedures and, according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to fnancial institutions and banks.

xii. the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other similar securities.

xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual beneft fund/society. therefore, the provisions of Clause (xiii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xiv. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause (xiv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xv. the Company has no guarantee outstanding as regards loan taken by the subsidiary Company. Accordingly the provisions of Clause (xv) of paragraph 4 of the aforesaid order are not applicable to the Company.

xvi. According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

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 investments.

xviii. the Company has not raised any money by issue of shares during the year. therefore, the provisions of Clause (xviii) of paragraph 4 of the aforesaid order are not applicable to the Company.

xix. the Company has not issued debentures during the year under audit. Accordingly, the provisions of Clause (xix) of paragraph 4 of the aforesaid order are not applicable to the Company.

xx. the Company has not raised any money by way of public issue during the year. therefore, the provisions of Clause (xx) of paragraph 4 of the aforesaid order are not applicable to the Company.

xxi. During the course of our examination of the books of account carried out in accordance with Generally Accepted Auditing Practices, we have neither come across any instance of fraud on or by the Company nor have we been informed of any such case by the Management.

For RAY & RAY

Chartered Accountants

R.N. ROY

Partner

Gurgaon Membership number 8608

29th May, 2011 Firms Registration number 301072E






Mar 31, 2010

1. We have audited the attached Balance Sheet of EIH Associated Hotels Limited as at 31st March, 2010, the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto, in which are incorporated the Branch Accounts audited by us. 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 the Companies (Auditors Report Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 (the Act) and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose 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:

(i) 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;

(ii) 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;

(iii) the Balance Sheet, Profit and 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 and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act;

(v) 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 Act;

(vi) in our opinion and to the best of our information and according to the explanations given to us, the said accounts read in conjunction with Schedules 1 to 23 give the information required by the Act 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, 2010;

(b) in the case of the Profit and Loss Account, of the profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT

(Referred to in paragraph 3 of our report of even date)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) During the year no substantial part of fixed assets have been disposed off by the Company.

ii. (a) The inventory has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion, 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) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii. (a) 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.

(b) In view of our comments in Clause iii(a) above, Clauses iii(b), iii(c) and iii(d) of paragraph 4 of the aforesaid Order are not applicable to the Company.

(c) The Company has taken unsecured loan from a Company covered in the Register maintained under Section 301 of the Act during the year. The maximum outstanding amount involved during the year was Rs. 320 million and the year end balance of loan taken from such Company is Rs. 320 million.

(d) In our opinion, the rate of interest and other terms and conditions on which loan has been taken from a Company covered in the Register maintained under Section 301 of the Act are not, prima facie, prejudicial to the interest of the Company.

(e) The loan taken from a Company is repayable on demand and we are given to understand that the loan has not yet been recalled. The Company is regular in payment of interest.

iv. 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, fixed assets and with regard to the sale of goods and services. Further, there is no continuing failure to correct major weaknesses in internal control system.

v. (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into the Register maintained under Section 301 of the Act have been so entered.

(b) According to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the Register maintained under Section 301 of the Act during the year cannot be compared in absence of market quotation for similar items.

vi. The Company has not accepted any deposits from the public during the year under Sections 58A and 58AA of the Act and the Companies (Acceptance of Deposits) Rules, 1975.

vii. In our opinion, the Company has an internal audit system commensurate with the size and the nature of its business.

viii. The Central Government has not prescribed maintenance of cost records under Section 209(l)(d) of the Act for the Company.

ix. (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material . statutory dues applicable to it.

(b) According to the information and explanations given to us, there are no dues of income tax, wealth tax, service tax, customs duty, excise duty and cess which have not been deposited on account of any dispute other than disputed sales tax as indicated below:

Sl.No. Name of the Nature of the Forum where Amount statute dues dispute is (Rs. Million) pending

1 Sales Tax:

a) Central Sales Tax Act, 1956 Sales Tax Tamil Nadu Sales Tax Appellate Tribunal, Chennai 0.36

b) Orissa Sales Tax Act Sales Tax i) Sales Tax Tribunal, Orissa 0.39

ii) Orissa High Court 0.31

Total 1.06

x. The Company has no accumulated losses and has not incurred any cash losses during the year covered by our report and the immediately preceding financial year.

xi. Based on our audit procedures and, according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks.

xii. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other similar securities.

xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of Clause (xiii) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xiv. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of Clause (xiv) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xv. The Company has given guarantee for loan taken by its Subsidiary Company from a bank. According to the information and explanations given to us, we are of the opinion that the terms and conditions on which the Company has given guarantee for loan taken from a bank are not, prima facie, prejudicial to the interest of the Company.

xvi. According to the information and explanations given to us, the term loans raised by the Company have been applied for the purpose for which they were raised.

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 investments.

xviii.The Company has not raised any money by issue of shares during the year. Therefore, the provisions of Clause (xviii) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xix. The Company has not issued any debentures during the year under audit. Accordingly, the provisions of Clause (xix) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xx. The Company has not raised any money by way of public issue during the year. Therefore, the provisions of Clause (xx) of paragraph 4 of the aforesaid Order are not applicable to the Company.

xxi. During the course of our examination of the books of account carried out in accordance with Generally Accepted Auditing Practices, we have neither come across any instance of fraud on or by the Company nor have we been informed of any such case by the Management.

For RAY & RAY Chartered Accountants

Firms Registration Number 301072E

R.N. ROY Mumbai Partner

27th May, 2010 Membership Number 8608

 
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