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Auditor Report of Gujarat Carbon & Industries Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Gujarat Carbon and Industries Limited, which comprise of the Balance Sheet as at 31st March, 2015, and the Profit and Loss Account and the 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 matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to 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 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating 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 there under.

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 the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, 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 control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Board of 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.

Basis for qualified opinion

1. We invite your attention to Note No.14 a. of notes forming part of financial statements regarding the accounts being prepared on a going concern basis. However, there is no alternative proposal to promote any other activity.

2. Accounting Standard 9 – "Revenue Recognition", the details and effect of which have been disclosed in paragraph 7 below. Further the disclosure requirements of AS 22 'Accounting for Taxes on Income' have not been followed regarding composition and accounting of deferred tax assets/ liabilities as on Balance Sheet date.

3. Note No. 14 d. regarding non provision of interest on certain inter-corporate deposits, the impact of which is not determined.

Opinion

Subject to above basis of qualification paragraph, 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,

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2015;

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

(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, 2015 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraphs 3 and 4 of the Order, to the extent applicable.

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 purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Income & Expenditure, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) 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.

(e) On the basis of the written representations received from the executive committee members as on 31st March, 2015 taken on record by the management, none of the Board members is disqualified as on 31st March, 2015 from being appointed as a member of the Board in terms of Section 164 (2) of the Act.

(f) With 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 does not have any pending litigations which would impact its financial position.

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

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure to Auditors' Report

(Referred to in paragraph under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

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

(b) The fixed assets were physically verified at the yearend by the management. The discrepancies noticed on such verification, which were not significant, have been properly dealt with in the books of account.

(ii) The Company does not have any inventories during the year.

(iii) According to the 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 189 of the Companies Act.

(iv) In our opinion and according to the information and explanations given to us there are adequate internal control systems commensurate with the size of the Company and the nature of its activities for purchase of inventory and fixed assets and for 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.

(v) The Company has not accepted deposits from the public.

(vi) The maintenance of cost records has not been prescribed by the Central Government under sub-section (1) of section 148 of the Companies Act.

(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, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues applicable to it. There were no arrears as at 31st March, 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us there are no dues of sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax or cess which have not been deposited as on 31st March, 2015 on account of any dispute. Details of dues of Income tax which have not been deposited as on 31st March, 2015 are as under: Name of the Nature of Amount under Period to the dispute is

Statute dues dispute which it (Rs. In lacs) relates

Income tax Act, 1961 Income tax 19.79 A.Y. 2002-2003

Income tax Act, 1961 Income tax 24.98 A.Y. 2003-2004



Name of the Forum where Statute pending

Income tax Act, 1961 Reverted to AO by ITI for review

Income tax Act, 1961 High Court of Gujarat

There are no amounts that are required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 2013 and rules made there under.

(viii) In our opinion, the accumulated losses of the Company are more than fifty percent of its net worth. The Company has incurred cash losses during the current financial year covered by our report and also in the immediately preceding financial year.

(ix) On the basis of records examined by us and the information and explanations given to us, the Company has not borrowed any funds during the year from financial institution or bank.

(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.

(xi) The Company has not obtained any term loans during the year.

(xii) According to the information and explanations given to us no fraud on or by the Company has been noticed or reported during the course of audit.

For Ramanlal G Shah & Co.

Chartered Accountants

Firm Registration No 108517W

(Vivek S. Shah)

Place: Ahmadabad Partner

Date: 23rd May, 2015 Membership No. 112269


Mar 31, 2014

We have audited the accompanying financial statements of Gujarat Carbon and Industries Limited, which comprise the Balance Sheet as at 31st March, 2014, and the Profit and Loss Account and the 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 and financial performance 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. Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with 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 of material misstatement.

An audit involves performing procedure to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, 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 the management, as well as evaluating the overall presentation of the financial statements.

Basis for qualified opinion

1. We invite your attention to Note No. 14 a. of notes forming part of financial statements regarding the accounts being prepared on a going concern basis. However, there is no alternative proposal to promote any other activity.

2. Accounting Standard 9 - "Revenue Recognition", the details and effect of which have been disclosed in paragraph 7 below. Further the disclosure requirements of AS 22 ''Accounting for Taxes on Income'' have not been followed regarding composition and accounting of deferred tax assets/ liabilities as on Balance Sheet date.

3. Note No. 14 d. regarding non provision of interest on certain inter-corporate deposits, the impact of which is not determined.

Opinion

Subject to above basis of qualification paragraph, in our opinion and to the best of our information and according to the explanations given to us, the said accounts 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, 2014;

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

(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 enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. As required by section 227 (3) of the Act, we report that:

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

b. In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d. In our opinion, the Balance Sheet and Statement of Profit and Loss and Cash Flow Statement 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, 2014 and taken on record by the Board of Directors, none of the director is disqualified as on 31st March, 2014 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

Annexure to Auditors'' Report

(Referred to in paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

As required by the Companies (Auditor''s Report) Order, 2003 issued by the Central Government of India in terms of subsection 4(A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books of accounts and records as we considered appropriate and the information and explanations given to us during the course of audit, we further state that:

(i) The nature of Company''s business / activities during the year have been such that clauses (xiii) and (xiv) of paragraph 4 of the Companies (Auditor''s report) Order, 2003 are not applicable to the company.

(ii) (a) The Company has maintained proper records to show full particulars, including quantitative details and situation of fixed assets, which requires to be updated.

(b) The Company has a program of physical verification of its fixed assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its business. In accordance with this programme, certain fixed assets are physically verified by the management during the year and according to the information and explanations given to us, no material discrepancies have been noticed on such verification.

(iii) The Company does not have any inventories during the year.

(iv) (a) According to the 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 Companies Act, 1956 during the year.

(b) According to information and explanations given to us the company has not taken any loans, secured or unsecured from companies, firms, of other parties covered in the register maintained under section 301 of the Act during the year.

(c) As the ICD is payable on demand, payment schedule has not been fixed. The company has provided interest up to 31.03.2002 amounting to Rs. 920.57 lacs which is pending for payment. No provision has been made for interest payable on such Inter Corporate Deposits since 31.03.2002, the amount of which is not determined.

(v) In our opinion and according to the information and explanations given to us, there are adequate internal control systems 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. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

(vi) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956

(b) In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance of such contracts or arrangements, and exceeding Rs. 5,00,000/- in respect of any party during the year.

(vii) The company has not accepted deposits from the public.

(viii) The company had no internal audit system during the year.

(ix) Since there are no operations during the year, the Company has not maintained the books of account prescribed under the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956.

(x) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Income Tax, Sales Tax, Custom Duty, Excise duty, Cess and other material Statutory dues appli -cable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, Investor Education Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess were in arrears as at 31st March, 2014 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 Customs Duty, Wealth Tax, Service Tax, and Cess, which has not been deposited on account of any dispute except as stated hereunder:

Name of the Nature of Amount under Period to Forum where the Statute dues dispute which it dispute is pending (Rs. In lacs) relates

Income tax Act, Income 19.79 A.Y. Reverted to AO by 1961 tax 2002-2003 ITAT for review

Income tax Act, Income 24.98 A.Y. ITAT 1961 tax 2003-2004 penalty

(xi) In our opinion, the accumulated losses of the company are more than fifty percent of its net worth. The Company has incurred cash losses during the financial year and also incurred cash loss during the year immediately preceding financial year.

(xii) In our opinion and according to the information and explanations given to us, company has not defaulted in repayment of its dues to a financial institution during the year.

(xiii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities

(xiv) 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.

(xv) The Company has not obtained any term loan during the year.

(xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that fund raised on short-term basis including other short-term loans from companies have not been used for long term investment.

(xvii) During the year the company has not made preferential allotment.

(xviii) During the period covered by our audit report, the company has not issued debentures.

(xix) The company has not raised monies through a public issue during the year.

(xx) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of audit.

For Ramanlal G Shah & Co. Chartered Accountants Firm Registration No 108517W

(Vivek S. Shah) Place : Ahmedabad Partner Date : 29th May, 2014 Membership No. 112269.


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Gujarat Carbon and Industries Limited, which comprise the Balance Sheet as at 31st March, 2013, and the Profit and Loss Account and the 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 and financial performance 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.

Auditor''s Responsibility .

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with 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 of material misstatement.

An audit involves performing procedure to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, 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 the management, as well as evaluating the overall presentation of the financial statements. Basis for qualified opinion

1. We invite your attention to Note No.15 a. of notes forming part of financial statements regarding the accounts being prepared on a going concern basis. However, there is no alternative proposal to promote any other activity.

2. Accounting Standard 9 - "Revenue Recognition", the details and effect of which have been disclosed in paragraph 7 below. Further the disclosure requirements of AS 22 ''Accounting for Taxes on Income'' have not been followed regarding composition and accounting of deferred tax assets/ liabilities as on Balance Sheet date.

3. Note No. 15 d. regarding non provision of interest on certain inter-corporate deposits, the impact of which is not determined.

Opinion

Subject to above basis of qualification paragraph, in our opinion and to the best of our information and according to the explanations given to us, they said accounts 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" March, 2013;

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

(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 enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. As required by section 227 (3) of the Act, we report that:

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

b. In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d. In our opinion, the Balance Sheet and Statement of Profit and Loss and Cash Flow Statement 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 director is disqualified as on 31s1 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 Auditors'' Report (Referred to in paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

As required by the Companies (Auditor''s Report) Order, 2003 issued by the Central Government of India in terms of subsection 4(A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books of accounts and records as we considered appropriate and the information and explanations given to us during the course of audit, we further state that;

(i) The nature of Company''s business / activities during the year have been such that clauses (xiii) and (xiv) of paragraph 4 of the Companies (Auditor''s report) Order, 2003 are not applicable to the company.

(ii) (a) The Company has maintained proper records to show full particulars, including quantitative details and situation of fixed assets, which requires to be updated.

(b) The Company has a program of physical verification of its fixed assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its business. In accordance with this programme, certain fixed assets are physically verified by the management during the year and according to the information and explanations given to us, no material discrepancies have been noticed on such verification.

(iii) The Company does not have any inventories during the year.

(iv) (a) According to the 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 Companies Act, 1956 during the year.

(b) as stated in paragraph (iv) (a), the company has not granted such loans during the year.

(c) According to information and explanations given to us the company has not taken any loans, secured or unsecured from companies, firms, of other parties covered in the register maintained under section 301 of the Act during the year.

(d) As the ICD is payable on demand, payment schedule has not been fixed. The company has provided interest up to 31.03.2002 amounting to Rs. 920.57 lacs which is pending for payment. No provision has been made for interest payable on such Inter Corporate Deposits since 31.03.2002, the amount of which is not determined.

(v) In our opinion and according to the information and explanations given to us, there are adequate internal control systems 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. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system.

(vi) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956

(b) In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance of such contracts or arrangements, and exceeding Rs. 5,00,000/- in respect of any party during the year.

(vii) The company has not accepted deposits from the public.

(viii) The company has no internal audit system during the year.

(ix) Since there are no operations during the year, the Company has not maintained the books of account prescribed under the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956.

(x) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including

Provident Fund, Investor Education Protection Fund, Income Tax, Sales Tax, Custom Duty, Excise duty, Cess and other material Statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, Investor Education Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess were in arrears as at 31st March, 2013 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 Customs Duty, Wealth Tax, Service Tax, and Cess, which has not been deposited on account of any dispute except as stated hereunder:_

Name of the Statute Nature of Amount under Period to Forum where the dues dispute which it dispute is pending (Rs. In lacs) relates

Income tax Act, 1961 Income tax 19.79 A.Y. 2002-2003 Reverted to AO by ITAT for review Income tax Act, 1961 Income tax 24.98 A.Y. 2003-2004 Commissioner (Appeals)

(xi) In our opinion, the accumulated losses of the company are more than fifty percent of its net worth. The Company has incurred cash losses during the financial year and also incurred cash loss during the year immediately preceding financial year.

(xii) In our opinion and according to the information and explanations given to us, company has not defaulted in repayment of its dues to a financial institution during the year.

(xiii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities

(xiv) 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.

(xv) The Company has not obtained any term loan during the year.

(xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that fund raised on short-term basis including other short-term loans from companies have not been used for long term investment.

(xvii) During the year the company has not made preferential allotment.

(xviii) During the period covered by our audit report, the company has not issued debentures.

(xix) The company has not raised monies through a public issue during the year.

(xx) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of audit.

For Ramanlal G Shah & Co.

Chartered Accountants

Firm Registration No 108517W

(Vivek S. Shah)

Place : Ahmedabad Partner

Date : 24th May, 2013 Membership No. 112269.


Mar 31, 2010

We have audited the attached Balance sheet of Gujarat Carbon and industries Limited as at 31st March 2010 and also 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.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material 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 provided a reasonable basis for our opinion.

1. We invite your attention to Note No.1 of schedule 13B regarding the accounts being prepared on a going concern basis. However, there is no alternative proposal to promote any other activity.

2. 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;

3. 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;



4. The Balance sheet and the Profit and Loss Account dealt with by this report are in agreement with the books of account;

5. In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 except Accounting Standard 9 - "Revenue Recognition", the details and effect of which have been disclosed paragraph 7 below. Further reference is invited to Note 18 of Schedule 13B regarding treatment of deferreo tax assets, wherein the disclosure requirements of AS 22 Accounting for Taxes on Income have not been followed regarding composition of deferred tax assets/ liabilities as on balance sheet date.

6. On the basis of the written representations received from directors of the Company 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 of the company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act 1956)

7. In our opinion and to the best of our information and according to the explanations given to us, the said accounts subject to what is stated in paragraph 1 above, and:

Note No. 5 of Schedule 13 B: regarding non provision of interest of Rs. 87.51 lacs payable on Inter Corporate Deposits. Had the above provision been considered, loss for the year would have been Rs. 112.24 lacs (as against reported loss figure of Rs. 27.73 lacs), accumulated losses would have been Rs. 1307.47 lacs (as against reported figure of Rs. 1219.96 lacs) and read with other notes thereon, given 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 principle generally accepted in India:

(a) in the case of the Balance Sheet, of the state of alfairs of the Company as at 31st March, 2010.

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

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

8. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of subsection 4(A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books of accounts and records as we considered appropriate and the information and explanations given to us during the course of audit, we further state that:

(i) The nature of Companys business / activities during the year have been such that clauses (xiii) and (xiv) of paragraph 4 of the Companies (Auditors report) Order, 2003 are not applicable to the company.

(ii) (a) The Company has maintained proper records to show full particulars, including quantitative details and situation of fixed assets, which requires to be updated.

(b) The Company has a program of physical verification of its fixed assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its business. In accordance with this programme, certain fixed assets have been physically verified by the management during the year and according to the information and explanations given to us, no material discrepancies have been noticed on such verification.

(iii) The Company does not have any inventories during the year.

(iv) (a) According to the 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 Companies Act, 1956 during the year.

(b) (c) & (d) as stated in paragraph (iv) (a), the company has not granted such loans during the year.

(e) (f) According to information and explanations given to us the company has not taken any loans, secured or unsecured from companies, firms, of other parties covered in the register maintained under section 301 of the Act during the year.

(g) As the ICD is payable on demand, payment schedule has not been fixed. The company has provided interest up to 31.03.2002 amounting to Rs. 920.57 lacs which is pending for payment. No provision is made for interest payable on such Inter Corporate Deposits amounting to Rs.87.51 lacs,

{v) In our opinion and according to the information and explanations given to us, there are adequate internal control systems 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. During the course of our audit. we have not observed any continuing failure to correct major weakness in internal control system.

(vi) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956

(b) In our opinion and according to the information and explanations given to us, there are no transactions made in- pursuance of such contracts or arrangements, and exceeding Rs. 5,00,000/- in respect of any party during the year.

(vii) The company has not accepted deposits from the public.

(viii) The company has no internal audit system during the year.

(ix) Since there are no operations during the year, the Company has not maintained the books of account prescribed under the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956.

(x) (a) The Company is generally regular except stated hereunder in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Income Tax, Sales Tax, Custom Duty, Excise duty, Cess and other material Statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, Investor Education Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess were in arrears as at 31st March, 2010 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 Customs Duty, Wealth Tax, Service Tax, and Cess, which has not been deposited on account of any dispute except as stated hereunder:

Name of the statute Nature of Amount Period to Forum where dues Under which the Dispute dispute it relates is pending (Rs Lacs)

Income tax Act, 1961 Income tax 6.79 A.Y. 2002- 2003 Commissioner (Appeals)

Gujarat Sales Tax Act Sales tax 7.02 2000-2001 Commissioner

(Sales tax)



(xi) In our opinion, the accumulated losses of the company are more than fifty percent of its net worth. The Company has incurred cash losses during the financial year and also incurred cash loss during the immediately preceding financial year.

(xii) In our opinion and according to the information and explanations given to us, company has not defaulted in repayment of its dues to a financial institution during the year.

(xiii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities

(xiv) 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.

(xv) The Company has not obtained any term loan during the year.

(xvl) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that fund raised on short-term basis including other short-term loans from companies have not been used for long term investment.

(xvii) During the year the company has not made preferential allotment.

(xviii) During the period covered by our audit report, the company has not issued debentures.

(xix) The company has not raised monies through a public issue during the year.

(xx) According to the information and explanations given to us. no fraud on or by the Company has been noticed or reported during the course of audit.

For Ramanlal G Shah & Co.

Chartered Accountants

(Vivek S. Shah)

Partner

Membership No. 112269

Registration Number 108517W

Place: Ahmedabad

Date: August 28, 2010


Mar 31, 2009

We have audited the attached Balance sheet of Gujarat Carbon and Industries Limited as at 31* March 2009 and also 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.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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 provided a reasonable basis for our opinion, ~

1. We invite your attention to Note No.1 of schedule 13 regarding the accounts being prepared on a going concern basis. However, there is no alternative proposal to promote any other activity.

2. We have obtained ail the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

3. 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;

4. The Balance sheet and the Profit and Loss Account dealt with by this report are in agreement with the books of account;

5. In our opinion, the Balance Sheet and the Profit and Loss Account dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, except Accounting Standard 9 - "Revenue Recognition", the details and effect of which have been disclosed in paragraph 7 below. Further reference is invited to Note 18 of Schedule 13 regarding treatment of deferred tax assets, wherein the disclosure requirements of AS 22 Accounting for Taxes on Income have not been followed regarding position of deferred tax assets/ liabilities as on balance sheet date.

6. On the basis of the written representations received from directors of the Company and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2009 from being appointed as a director of the company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

7. In our opinion and to the best of our information and according to the explanations given to us, the said accounts subject to what is stated in paragraph 1 above, and:

Note No. 5 of Schedule 13: regarding non provision of interest of Rs. 90.89 lacs payable on Inter Corporate Deposits. Had the above provision been considered, loss for the year would have been Rs. 1092.32 lacs (as against reported loss figure of Rs. 1001.43 lacs), accumulated losses would have been Rs. 1286.07 lacs (as against reported figure of Rs. 1195.18 lacs)

and read with other notes there on, given 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 principle generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2009.

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

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

8. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of subsection 4(A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books of accounts and records as we considered appropriate and the information and explanations given to us during the course of audit, we further state that:

i) The nature of Companys business / activities during the year have been such that clauses (xiii) and (xiv) of _paragraph 4 of the Companies (Auditors report) Order, 2003 are not applicable to the company

it) (a) The Company has maintained proper records to show full particulars, including quantitative details and situation of fixed assets, which requires to be updated

(b) The Company has a program of physical verification of its fixed assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its business. In accordance with this programme, certain fixed assets have been physically verified by the management during the year and according to the information and explanations given to us, no material discrepancies have been noticed on such verification.

(c) The company has sold its entire plant & machinery and related electrical installations abroad during the year.

iii)_(a) As explained to us, the inventories have not been physically verified during the year by the management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories.

iv) (a) According to the 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 Companies Act, 1956 during the year.

(b) According to information and explanations given to us the company has not taken any loans, secured or unsecured from companies,firms, of other parties covered in the register maintained under section 301 of the Act during the year.

(c) As the ICD is payable on demand, payment schedule has not been fixed. The company has provided interest up to 31.03.2002 amounting to Rs. 1013.87 lacs which is pending for payment. No provision is made for interest payable on such Inter Corporate Deposits amounting to Rs.90.89 lacs.

v) In our opinion and according to the information and explanations given to us, there are adequate internal control systems 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. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system. v

vi) (a) In our opinion and according to the information and explanations given to us, there are no transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956

(b) In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance of such contracts or arrangements, and exceeding Rs. 5,00,000/- lacs in respect of any party during the year.

vii) The company has not accepted deposits from the public.

viii) The company has no internal audit system during the year.

ix) Since there are no operations during the year, the Company has not maintained the books of account prescribed under the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956.

x) (a) The Company is generally regular except stated here under in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Income Tax, Sales Tax, Custom Duty, Excise duty, Cess and other material Statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, Investor Education Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess were in arrears as at 31st March, 2009 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 Customs Duty, Wealth Tax, Service Tax, and Cess, which has not been deposited on account of any dispute except as stated hereunder:

Name of the Nature of Amount Under Period to which Forum where the statuteIt dues Dispute (Rs Lacs) relates dispute is pending

Income Tax Act, 1961 Income Tax 6.79 AY 2002-03 CIT (Appeals) Central Excise Act, 1944 Excise 1.50 2003-04 Commissioner (Appeals) Gujarat Sales Tax Act Sales Tax 7.02 2000-01 Commissioner (Sales Tax)

xi) In our opinjon, the accumulated losses of the company are more than fifty percent of its net worth. The Company has incurred cash losses during the financial year and also incurred cash loss during the year immediately preceding financial year.

xii) In our opinion and according to the information and explanations given to us, company has not defaulted in repayment of its dues to a financial institution during the year.

xiii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities

xiv) 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.

xv) The Company has not obtained any term loan during the year.

xvi) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that fund raised on short-term basis including other short-term loans from companies have not been used for long term investment.

xvii) During the year the company has not made preferential allotment.

xviii) During the period covered by our audit report, the company has not issued debentures.

xix) The company has not raised monies through a public issue during the year.

xx) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of audit.

For Ramanlal G Shah & Co..

Chartered Accountants

(Vivek S. Shah)

Partner

Membership No. 112269

Place: Ahmedabad

Date: September 19, 2009

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