Mar 31, 2018
Report on the Standalone Ind AS Revised Financial Statements
We have audited the accompanying standalone Ind AS Revised financial statements of Maha Rashtra Apex Corporation Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018 the Statement of Profit and Loss, (including the statement of Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information [hereinafter referred to as âstandalone Ind AS Revised Financial statementsâ].
Managementâs Responsibility for the Standalone Ind AS Revised Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these [standalone] Ind AS Revised financial statements that give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act., read with [the Companies (Indian Accounting Standards) Rules, 2015, as amended and other accounting principles generally accepted in india.
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 the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS revised financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone Ind AS Revised 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 of the standalone Ind AS Revised financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as 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 IND AS Revised financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the IND AS revised financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS revised financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS revised financial statements that give a true and fair view 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 Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS revised 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 Ind AS revised financial statements.
Opinion:
In our opinion and to the best of our information and according to the explanations given to us, the Ind AS revised 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 March 31, 2018, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Emphasis on Matters:
On revised financial statements:
In forming our Opinion on the revised financial statements, which is not qualified, we have considered the disclosure made in note (Refer Note No 1(a)) on Fair Value Gain, of unquoted Equity share which is regrouped from Other Income to Other Comprehensive Income and its consequential effect on EPS. The original financial statements were approved by the board on 30/05/2018 and our previous report was signed on that date.
Further we draw attention to the following:
a. Refer to Note No 31, As per the scheme sanctioned by Honorable High Court of Karnataka vide order dated 8th October2004 all Deposit/ Bonds should have been repaid by 15.06.2009 and 15.09.2009. The balance outstanding as on date are shortfall of repayment amounting to Rs.6282.72 Lakhs.
b. the management believe that the accumulated loss of earlier years would be effectively monitored and paired in due course. The revised financial statements, as such have been prepared on going concern basis.
c. Fair value of Investments in Associate companies are as furnished by the management on the basis of unaudited revised financial statements
d. In the opinion of the management Income tax Provision is required to be made on the profits as per IGAAP.
Our opinion is not modified in respect of the matters as stated in the above paragraph.
Other Matter
The Ind AS revised financial statements of the Company for the year ended March 31, 2017, included in these standalone Ind AS revised financial statements, have been audited by the predecessor auditor who expressed an Qualified opinion on those statements on 26.05.2017. The comparative financial information of the Company for the year ended March 31, 2017 and the transition date opening balance sheet as at April 01, 2016 included in these standalone Ind AS revised financial statements, are based on the previously issued statutory financial statements prepared in accordance with the accounting principles generally accepted in India, including the Companies (Accounting Standards) Rules, 2006 (as amended) specified under section 133 of the Act, read with the Companies (Accounts) Rules, 2014 audited by the predecessor auditor whose report for the year ended March 31,2017 and March 31, 2016 dated May 26, 2017, and May 30, 2016 respectively expressed an qualified opinion on those standalone financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by us.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure 1 statement on the matters specified in paragraphs 3 and 4 of the 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;
(c) The Balance Sheet, Statement of Profit and Loss (including the Statement of Other Comprehensive Income), the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS Revised financial statements comply with the Indian Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of written representations received from the directors as on March 31, 2018, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company with reference to these standalone Ind AS revised financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;
(g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, 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 litigations on its financial position in its Ind AS revised financial statements - Refer Note 38 On Contingent Liabilities to the Ind AS revised financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses].
iii. Refer to Note No.32 The entire deposit liability is covered under the scheme of arrangement, hence the Transfer of unclaimed deposit and remaining unpaid for a period of exceeding 7 years to Investor Education and Protection Fund, the question of delay in transferring such sums does not arise.
Annexure â1â to the Independent Auditorâs Report to the members of Company for the year ended 31st March, 2018
The Annexure referred to in our Independent Auditorsâ Report to the members of the Company on the revised financial statements for the year ended 31st March 2018, we report that:
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets ;
(b) i. During the year, Fixed assets have been physically verified by the management as informed, no material discrepancies were noticed on such verification; In our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its assets.
ii. In respect of the Assets on lease have not been physically verified by the Management as most of the assets are under legal proceedings. Material discrepancies noticed (if any) on such verification have been properly dealt with in the books of account.
(c) The title deeds of the immovable properties are in the name of the Company.
(ii) The nature of business of the Company does not require it to have any inventory. Hence, the requirement of clause (ii) of paragraph 3 of the said Order is not applicable to the Company
(iii) As Informed, the company has not granted any loans, during the year secured or unsecured to companies, firms, Limited liability Partnership or other parties covered in the register maintained under section 189 of the Act. In respect of loans granted in earlier years the repayment of loans is not regular but the company has taken proper steps for recovery.
(iv) The Company has not made any Loans requiring compliance of section 185 of the Companies Act 2013 during the year. In respect of an Investment of 50,000 equity shares of â10/- each in M/s Eldorado Investments Company (P) Ltd. a subsidiary company for a sale consideration of â 9,50,000/-compliance of Section 186 of the Companies Act 2013 is pending.
(v) The Company has not accepted any deposits from the public covered under Section 73 to 76 of the Companies Act, 2013
(vi) As informed to us, the Company is not required maintain cost records under sub-section (1) of Section 148 of the Act, clause not applicable.
(vii) (a) Based on the records of the company examined by us, the company is regular in depositing the undisputed statutory dues, including Provident Fund, Employeesâ State Insurance, Income-tax, Sales-tax, , Service Tax, Goods and Service Tax, Custom Duty, Excise Duty and other material statutory dues, as applicable, with the appropriate authorities in India ;
(b) According to the information and explanations given to us and based on the records of the company examined by us, there are no dues of Income Tax, Service Tax, Sales Tax, Customs Duty and Excise Duty which have not been deposited on account of any disputes. Disputed income tax liability amounting to 264.82 lakhs for the Assessment years 1998-99 to 2000-01 are pending before CIT(A) for disposal. This demand has raised on account of disallowance of depreciation on leased assets and bad debts. The said demand is adjusted against refund due to the company. Disputed sales tax amounting to â17.54 lakhs in Andhra Pradesh pending for disposal Sales Tax Appellate Tribunal.
(viii) The company has not borrowed loans from Banks financial institution, government authorities. In respect of Debenture interest accrued thereon up to 31.03.2002, the company is in the process repayment as per the scheme of compromise and arrangement sanctioned by the Honorable High Court of Karnataka dated 8th October 2004.
(ix) As Informed, the company has not raised money by way of Initial public offer /Further Public Offer (including debt Instrument) during the year.
(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company or any fraud on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such instance by the Management.
(xi) The Managerial Remuneration paid to its Managing Director is within the limits specified under Section 197 read with Schedule V of the Companies Act.
(xii) The Company is Not a Nidhi company and Paragraph 3(xii) of the Order is not applicable to the Company.
(xiii) The Company has disclosed all transaction with the related parties are in compliance with section 177 and 188 of Companies Act 2013 were applicable and the details have been disclosed in the standalone Ind As revised financial statements etc., as required by applicable Indian Accounting standards (refer to Note No:26) . However in respect of Two Associate companies i.e Mangala Investment Limited and Rajmahal Hotels Ltd. in absence of documentary evidence we are unable to comment upon related party transactions entered in- respect of armâs length price.
(xiv) No private placement or preferential allotment of the shares or debentures were made during the year.
(xv) The company has not entered into any non-cash transactions with directors or persons connected with him.
(xvi) The certificate of registration granted to the company to act as Non-Banking Financial Company as per Section 45-IA of Reserve Bank of India Act, 1934, has been cancelled by an order dated 13th June 2002.
ANNEXURE 1 TO THE INDEPENDENT AUDITORâS REPORT
Referred to in Paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ in the Independent Auditorâs Report of even date to the members of Maha Rashtra Apex Corporation Limited on the Standalone Ind AS Revised Financial Statements for the year ended March 31, 2018
Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of Maha Rashtra Apex Corporation Limited (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the Standalone Ind AS Revised Financial Statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (âthe Guidance Noteâ) issued by the Institute of Chartered Accountants of India (âICAIâ).
These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing specified under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the ICAI.
For MAIYA AND MAIYA
Chartered Accountants
ICAI Firm Registration Number: 001944S
S/d
RAVI PRASAD K
Partner
Membership Number: 228348
Place of Signature: Bengaluru.
Date: 12th June, 2018.
Mar 31, 2016
Report on the Financial Statements
1. We have audited the accompanying financial statements of MAHA RASHTRA APEX CORPORATION LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2016, 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
2. The management and Board of Directors of the Company are 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 Companies (Accounts) Rules, 2014. This responsibility 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 application of appropriate Accounting policies; making judgments and estimates that are reasonable and prudent; design, implementation and maintenance of adequate internal financial controls, that are 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
3 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.
4 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 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 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 management and Board of Directors, as well as evaluating the overall presentation of the financial statements.
5 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion
Basis for qualified Opinion:
By an order dated 13th June 2002, RBI has cancelled the certificate of registration granted to the company to act as Non-Banking Financial Company.
Accrued interest on deposits and bonds were provided up to 31.03.2002 only in accordance with the scheme of restructure of the debts as sanctioned by the Honorable High Court of Karnataka.
All the installment of repayments of deposits/bonds as per the scheme of High Court of Karnataka are due for payment on 15th September 2009 and 15th June 2009.The company stopped repayment of deposits/bonds on maturity dates till the sanction of restructure by the Honorable High Court of Karnataka on 8th October 2004. Now the company has started repayment of deposits/bonds under the sanctioned scheme and shortfall in repayment amounted to Rs. 4649.61lakhs.
Provision has not been made in the accounts as required under RBI prudential Norms since 2000. The effect of non-provision is overstatement of assets by '' Rs.1868.99 Lakhs, and Understatement of loss by Rs.Rs.1868.99 Lakhs, including Short provision for diminution in the value of investments Rs..6.27 lakhs.
In terms of direction issued by RBI
i. The company has not obtained Credit Rating.
ii. The Capital adequacy is negative.
iii. In view of negative net worth all lending and investments are in excess of credit concentration limit stipulated by Reserve Bank of India.
iv The company has encased all the approved securities and utilized for repayment of deposits/bonds.
Emphasis on Matters:
Your kind attention is drawn to the following matters:
i. Note 3.5 on Notes to accounts, the company is incurring losses since 2001 and its funds are blocked in non-performing assets. The assets of the company is completely eroded and net worth of the company is negative. The company has prepared its financial statement of accounts on a going concern basis as the management is off the view that it will be able to recover the dues from the borrowers/debtors and monitor the deficit in operation but we are unable to comment on the ultimate reliability of company''s assets. These conditions indicate the existence of material uncertainty that may cast significant doubt about the companies ability to continue as a going concern.
ii. Note 3.6 to Notes on Accounts, Provision has not been made in the accounts as required under RBI prudential Norms since 2000. The effect of non-provision is overstatement of assets by Rs..1868.99 Lakhs, and Understatement of loss by '' 868.99.including Short provision for diminution in the value of investments '' Rs.6.27Lakhs.
iii. Note 3.7 to Notes on Accounts, Investment in shares includes 750000 equity shares of ''.10 each in Bhooma Automobiles Ltd., sent for transfer in June 2012 is still pending for transfer in the name of the company. These shares were initially held by the company shown under investment and included in the list submitted to Honorable High Court of Karnataka in CP/37/2003. Subsequently these shares were sold, but ROC Karnataka objected for sale of these shares for not obtaining prior permission from Honorable High Court of Karnataka. Therefore the company repurchased these shares during 2012 and sent for transfer in the companies name. These shares are not available for physical verification. And company has invested 50,000 shares of Rs. 10/- each in Eldorado Investment Company Pvt. Ltd.., a subsidiary company for a consideration of Rs.9,50,000/-,share certificate not produced for verification.
iv. No provision for Income tax liability against the order of the AO u/s 143(3) amounting to Rs..264.82 Lakhs in respect of following assessment years.
i. A.Y 1998 - 99 Rs..52.44 Lakhs against disallowance of depreciation on leased asset and not giving credit for Tax
ii. A.Y 1999 - 2000 '' Rs.85.80 Lakhs against disallowance of depreciation on Leased assets and Bad debts.
iii. A.Y2000- 01 Rs..126.58 Lakhs against disallowance of depreciation on Leased assets and Bad debts. These appeals are pending before CIT (A) for disposal.
iv. Disputed sales tax amounting to Rs..17.54 lakhs in Andhra Pradesh pending for disposal Sales Tax Appellate Tribunal.
V. Note No 3.11 of Notes on account Un En-cashed cheques amounting to Rs..415.19 Lakhs being un encashed DD/Multi city cheques issued for repayment of deposits/Bonds in terms of the scheme which is included under other current liabilities.
Qualified Opinion
6. In our opinion and to the best of our information and according to the explanations given to us, except for the effect/possible effect of the matters included in para the Basis for Qualified Opinion Paragraph and under Emphasis on matters reported above, to this report referred to in 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 2016, its loss and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of section143 of the Act, we give in the Annexure âAâ statement on the matters Specified in paragraphs 3 and 4 of the Order to the extent applicable.
8 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 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, except the matters in para on emphasis matter reported above, and Basis for Qualified Opinion may have adverse effect on the functioning on the company, aforesaid financial statements comply with the applicable Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules 2014
e. on the basis of written representations received from the directors as on March 31, 2016, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016, from being appointed as a director in terms of Section 164(2) of the Act.
f. With Respect to the adequacy of Internal financial controls over financial reporting of Company and the Operating effectiveness of such controls, refer to our separate report in âAnnexure Bâ; and
g. Company has not appointed Internal Auditor as per the requirement of companies act 2013.
h. In our opinion and to the best of our information and according to the explanations given to us, we report as under with respect to other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014:
(i) The Company has disclosed the impact of pending litigations which would impact its financial position - refer to Note No 3.13 Notes to accounts.
(ii) The Company did not have any long-term contracts including derivative contracts; as such the question of commenting on any material foreseeable losses thereon does not arise.
(iii) As the entire deposit liability is covered under the scheme of arrangement transfer of matured deposit remaining unpaid for a period of exceeding 7 years to Investor Education and Protection Fund, the question of delay in transferring such sums does not arise
i. An amount of Rs..6,90,028/- provided in the accounts towards delayed payment of interest under section 194 A of IT Act 1961, on repayment of deposits / bonds is liable for disallowance under 40 (a). (ia).
The Annexure referred to in our Independent Auditors'' Report to the members of the Company on the financial statements for the year ended 31st March 2016, we report that:
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets ;
(b) i. Fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification;
ii. Assets on lease have not been physically verified by the Management as most of the assets are under legal proceedings. Material discrepancies noticed on such verification have been properly dealt with in the books of account.
(c) The title deeds of the immovable properties are in the name of the Company.
(ii) The nature of business of the Company does not require it to have any inventory. Hence, the requirement of clause (ii) of paragraph 3 of the said Order is not applicable to the Company (iii)
(iii) The company has not granted any loans, during the year secured or unsecured to companies, firms, Limited liability Partnership or other parties covered in the register maintained under section 189 of the Act. In respect of loans granted in earlier years the repayment of loans is not regular but the company has taken proper steps for recovery.
(iv) The Company has not made any Loans requiring compliance of section 185 of the Companies Act 2013 during the year. In respect of an Investment of 50,000 equity shares of Rs.10/- each in Eldorado Investments Company (P) Ltd a subsidiary company for a sale consideration of Rs.9,50,000/compliance of Section 186 of the Companies Act 2013 is pending.
(v) The Company has not accepted any deposits from the public covered under Section 73 to 76 of the Companies Act, 2013
(vi) As informed to us, the Central Government has not prescribed maintenance of cost records under sub-section (1) of Section 148 of the Act
(vii) (a) Based on the records of the company examined by us, the company is regular in depositing the undisputed statutory dues, including Provident Fund, , Employees'' State Insurance, Income-tax, Sales-tax, Service Tax, Custom Duty, Excise Duty and other material statutory dues, as applicable, with the appropriate authorities in India ;
(b) According to the information and explanations given to us and based on the records of the company examined by us, there are no dues of Income Tax, Service Tax, Sales Tax, Customs Duty and Excise Duty which have not been deposited on account of any disputes. Disputed income tax liability amounting to Rs..264.82 lakhs for the Assessment years 1998-99 to 2000-01 are pending before CIT (A) for disposal. This demand has raised on account of disallowance of depreciation on leased assets and bad debts. The said demand is adjusted against refund due to the company. Disputed sales tax amounting to Rs..17.54 lakhs in Andhra Pradesh pending for disposal Sales Tax Appellate Tribunal.
(viii) The company has not borrowed loans from Banks financial institution, government authorities. In respect of Debenture interest accrued thereon up to 31.03.2002, the company is in the process repayment as per the scheme of compromise and arrangement sanctioned by the Honorable High Court of Karnataka dated 8th October 2004.
(ix) The company has not raised money by way of Initial public offer /Further Public Offer (including debt Instrument) during the year.
(x) No fraud on or by the Company was noticed or reported during the year under report
(xi) The Managerial Remuneration paid to its Managing Director is within the limits specified under Section 197 read with Schedule V of the Companies Act.
(xii) The Company is Not a Nidhi company and Nidhi rules 2015 is not applicable.
(xiii) The Company has disclosed all transaction with the related parties are in compliance with section 177 and 188 of Companies Act 2013 were applicable and the details have been disclosed in the financial statements etc., as required by applicable accounting standards. However in respect of Two Associate companies i.e Mangala Investment Limited and Rajmahal Hotels Ltd in-absence of documentary evidence we are unable to comment upon related party transactions entered inrespect of arm''s length price.
(xiv) No private placement or preferential allotment of the shares or debentures were made during the year.
(xv) The company has not entered into any non-cash transactions with directors or persons connected with him.
(xvi) The certificate of registration granted to the company to act as Non-Banking Financial Company as per Section 45-IA of Reserve Bank of India Act, 1934, has been cancelled by an order dated 13th June 2002.
For RAO & SWAMI
Chartered Accountants
(Firm''s Registration No.003105S)
Place : Bengaluru (P V Shenoy)
Date : 30/05/2016 (Partner)
(Membership No. 020205)
Mar 31, 2015
1 We have audited the accompanying financial statements of MAHA RASHTRA
APEX CORPORATION LIMITED ("the Company"), which comprise the Balance
Sheet as at March 31,2015, 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
2. The management and Board of Directors of the Company are
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 Companies (Accounts) Rules, 2014. This
responsibility 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 application of appropriate accounting
policies; making judgments and estimates that are reasonable and
prudent; design, implementation and maintenance of adequate internal
financial controls, that are 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
3. 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
4. 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 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 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 management and Board of
Directors, as well as evaluating the overall presentation of the
financial statements
5 We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion
Basis for qualified Opinion:
By an order dated 13 June 2002, RBI has cancelled the certificate of
registration granted to the company to act as Non-Banking Financial
Company.
Accrued interest on deposits and bonds were provided up to 31.03.2002
only in accordance with the scheme of restructure of the debts as
sanctioned by the Honorable High Court of Karnataka.
All the installment of repayments of deposits/bonds as per the scheme
of High Court of Karnataka are due for payment on 15th September 2009
and 15th June 2009.The company stopped repayment of deposits/bonds on
maturity dates till the sanction of restructure by the Honorable High
Court of Karnataka on 8th October 2004.Now the company has started
repayment of deposits/bonds under the sanctioned scheme and shortfall
in repayment amounted to Rs. 5554.72Lakhs.
Provision has not been made in the accounts as required under RBI
prudential Norms since 2000.The effect of non-provision is
overstatement of assets by Rs. 2729.53 Lakhs, and Understatement of
loss by Rs. 2729.53 Lakhs, including Excess provision for diminution in
the value of investments Rs. 65.75 lakhs.
In terms of direction issued by RBI
i. The company has not obtained Credit Rating.
ii. The Capital adequacy is negative.
iii. There has been delay in submission of statement to RBI
iv. In view of negative net worth all lending and investments are in
excess of credit concentration limit stipulated by Reserve Bank of
India.
v. The company has encased all the approved securities and utilized
for repayment of deposits/bonds Emphasis on Matters:
Your kind attention is drawn to the following matters:
i. Note 3.6 on Notes to accounts, the company is incurring losses
since 2001 and its funds are blocked in non performing assets. The
assets of the company is completely eroded and net worth of the company
is negative. The company has prepared its financial statement of
accounts on a going concern basis as the management is of the view that
it will be able to recover the dues from the borrowers/debtors and
monitor the deficit in operation but we are unable to comment on the
ultimate reliability of company's assets. These conditions indicate the
existence of material uncertainty that may cast significant doubt about
the companies ability to continue as a going concern.
ii. Provision has not been made in the accounts as required under RBI
prudential Norms since 2000. The effect of non-provision is
overstatement of assets by Rs. 2729.53lakhs, and Understatement of loss
by Rs. 2729.53 lakhs, including Excess provision for diminution in the
value of investments Rs. 65.75 lakhs.
iii. No provision for Income tax liability against the order of the AO
u/s 143(3) amounting to Rs. 264.82 Lakhs in respect of following
assessment years.
i. A.Y 1998 - 99 Rs. 52.44 Lakhs against disallowance of depreciation
on leased asset and not giving credit for Tax
ii. A.Y 1999 - 2000 Rs. 85.80 Lakhs against disallowance of
depreciation on Leased assets and Bad debts.
iii. A.Y 2000 - 01 Rs. 126.58 Lakhs against disallowance of
depreciation on Leased assets and Bad debts.
These appeals are pending before CIT (A) for disposal.
iv. Disputed sales tax amounting to Rs. 17.54 lakhs in Andhra Pradesh
pending for disposal Sales Tax Appellate Tribunal.
iv. Note No 3.12 of Notes on account Un Encashed cheques amounting to
Rs. 460.38 Lakhs being un encashed DD/Multi city cheques issued for
repayment of deposits/Bonds in terms of the scheme which is included
under other current liabilities.
Qualified Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us, except for the effect/possible effect of
the matters included in para under emphasis on matters reported above
and the Basis for Qualified Opinion Paragraph, to this report referred
to in 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, its loss
and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
7 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 section143 of the Act, we give in the Annexure a
statement on the matters Specified in paragraphs 3 and 4 of the Order
to the extent applicable.
8 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 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, except the matters in para on emphasis matter
reported above, and basis for qualified may have adverse effect on the
functioning on the company,aforesaid financial statements comply with
the applicable Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules 2014
e. on the basis of written representations received from the directors
as on March 31, 2015, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2015, from being
appointed as a director in terms of Section 164(2) of the Act.
f. The company has not carried out Internal audit as per section 138
of companies act
g. In our opinion and to the best of our information and according to
the explanations given to us, we report as under with respect to other
matters to be included in the Auditor's Report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014:
(i) The Company has disclosed the impact of pending litigations which
would impact its financial position - refer to Note No 3.14 Notes to
accounts.
(ii) The Company did not have any long-term contracts including
derivative contracts; as such the question of commenting on any
material foreseeable losses thereon does not arise.
(iii) As the entire deposit liability is covered under the scheme of
arrangement transfer of matured deposit remaining unpaid for a period
of exceeding 7 years to Investor Education and Protection Fund,the
question of delay in transferring such sums does not arise
(iv) An amount of Rs. 12,29,088/- provided in the accounts towards
delayed payment of interest under section 194 A of IT Act 1961, on
repayment of deposits / bonds is liable for disallowance under 40 (a)
(ia).
(v) The Company has not complied with appointment of internal auditor
as required section 138 of the Companies Act 2013.
ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF COMPANY
FOR THE YEAR ENDED 31ST MARCH, 2015.
The Annexure referred to in our Independent Auditors' Report to the
members of the Company on the financial statements for the year ended
31st March 2015, we report that:
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets ;
(b) i. Fixed assets have been physically verified by the management at
reasonable intervals; no material discrepancies were noticed on such
verification; ii. Assets on lease have not been physically verified by
the Management as most of the assets are under legal proceedings.
Material discrepancies noticed on such verification have been properly
dealt with in the books of account.
(ii) The nature of business of the Company does not require it to have
any inventory. Hence, the requirement of clause (ii) of paragraph 3 of
the said Order is not applicable to the Company
(iii) The company has not granted any loans, during the year secured or
unsecured to companies, firms or other parties covered in the register
maintained under section 189 of the Act.
In respect of loans granted in earlier years the repayment of loans is
not regular but the company has taken proper steps for recovery.
(iv) Generally there is an adequate internal control system
commensurate with the size of the Company and the nature of its
business, for the purchase of fixed assets and for the sale of
services. Further, on the basis of our examination of the books and
records of the Company and according to the information and
explanations given to us, no major weakness has no been noticed or
reported.
(v) The Company has not accepted any deposits from the public covered
under Section 73 to 76 of the Companies Act, 2013.
(vi) As informed to us, the Central Government has not prescribed
maintenance of cost records under sub section (1) of Section 148 of the
Act.
vii) (a) Based on the records of the company examined by us, the
company is regular in depositing the undisputed statutory dues,
including Provident Fund, , Employees' State Insurance, Income-tax,
Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and other
material statutory dues, as applicable,with the appropriate authorities
in India ;
(b) According to the information and explanations given to us and based
on the records of the company examined by us, there are no dues of
Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs Duty and Excise
Duty which have not been deposited on account of any disputes. Disputed
income tax liability amounting to Rs. 264.82 lakhs for the Assessment
years 1998-99 to 2000-01 are pending before CIT(A) for disposal. This
demand has raised on account of disallowance of depreciation on leased
assets and bad debts. The said demand is adjusted against refund due to
the company. Disputed sales tax amounting to Rs. 17.54 lakhs in Andhra
Pradesh pending for disposal Sales Tax Appellate Tribunal.
(c) As the entire deposit liability is covered under the scheme of
arrangement transfer of matured deposit remaining unpaid for a period
of exceeding 7 years to Investor Education and Protection Fund, the
question of delay in transferring such sums does not arise
viii) As at 31st March, 2015, the Company has accumulated loss and the
net wealth of the company is completely eroded. The company incurred
cash losses in such financial year and in the immediately preceding
financial year.
(ix) According to the records of the company examined by us and as per
the information and explanations given to us, the company has not
availed of any loans from any financial institution or banks and has
not issued debentures. And interest accrued thereon up to 31.03.2002,
the company is in the process repayment as per the scheme of compromise
and arrangement sanctioned by the Honorable High Court of Karnataka
dated 8th October 2004.
(x) The Company has not given any guarantee for loan taken by others
from a bank or financial institution during the year.
(xi) In our opinion, and according to the information and explanations
given to us, the company has not raised any term loans during the year.
(xii) During the course of our examination of the books and records of
the company, carried in accordance with the auditing standards
generally accepted in India, we have neither come across any instance
of fraud on or by the Company noticed or reported during the course of
our audit nor have we been informed of any such instance by the
Management.
For RAO & SWAMI
Chartered Accountants
(Firm's Registration No.003105S)
Place : Bengaluru (P V Shenoy)
Date : 27/05/2015 (Partner)
(Membership No. 020205)
Mar 31, 2014
We have audited the accompanying financial statements of MAHA RASHTRA
APEX CORPORATION LIMITED which comprise the Balance Sheet as at March
31, 2014, 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 read with general Circular 15/2013 dated
13th September of the Ministry of Corporate affairs, in respect of
section 143 of companies act 2013. 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 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, but not for the
purpose of expressing an opinion on the effectiveness on the entity''s
internal control. 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.
Basis for Qualified Opinion
A) In terms of direction issued by RBI, we state that:
i) The Company has not obtained Credit Rating
ii) The Capital Adequacy Ratio is negative.
iii) There has been some delay in submission of Statements to RBI.
iv) In view of the negative net worth, all lending''s and investments
are in excess of Credit Concentration Limit stipulated by the Reserve
Bank of India.
v) The company has en-cashed all the approved securities and utilized
for repayment of deposits.
B) Though the net-worth of the Company is negative, it has prepared the
accounts on "going concern" basis on the presumption that deficit in
operations will be effectively monitored (refer Note No.3.6.).
C) By its order dated 13th June, 2002, RBI has cancelled the
Certificate of Registration granted to the Company to act as
Non-Banking Financial Company
D) Accrued interest on deposits and bonds were provided upto 31.3.2002
only as per the Scheme of Restructure of the debts of the Company as
sanctioned by the Hon''ble High Court of Karnataka (refer Note 3.1(a)).
E) The company has stopped repayment of deposits/bonds on maturity
dates, till the sanction of Scheme of Restructure by the Hon''ble High
Court of Karnataka on 8th October, 2004. Now the company has started
repayment under the sanctioned Scheme and the short fall in repayment
amounted to Rs. 6732.43 lakhs (refer Note No 3.1 and 3.2).All the
instalments of repayment of deposits/bonds are as per scheme sanctioned
by High Court of Karnataka due for payment on 15th September 2009 and
15th June 2009 (refer Note No3.1 (e) and Note No 3.1(f)).
F) Though the management is of the view that it will be able to monitor
effectively the deficit in operation, we are unable to comment on the
ultimate reliability of company''s assets.
G) a. Provision has not been made as required under RBI Prudential
Norms since 1.4.2000. Had this been provided for, the net assets would
have been less and the accumulated loss would have been more by the
provision required Rs. 2816.90 Lakhs. (inclusive of Short provision for
diminution in the value of investments Rs. 1,92,862/-) (Refer Note
No. 3.7).
H) Two current accounts with scheduled Bank shows a overdrawn balance
of Rs. 2,69,39,173/- (Cr) under Short term Borrowings from Banks
grouped under Current Liabilities. The company has submitted a
reconciliation statement. But we are unable to comment on the accuracy
of the same (Refer Note No 3.16.)
Opinion:
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matters
described in the Basis for Qualified Opinion paragraph 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 March 31, 2014;
b) in the case of the Statement of Profit and Loss, of the loss 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 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a) 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 comply with the Accounting Standards notified under
the Act read with general circular 15/2013 dated 13th September 2013
issued by the ministry of corporate affairs inrespect of Section 133 of
the companies act 2013.; except Note No. 3.14 and 3.15 creation of
Deferred Tax Asset and regarding creation of Capital Redemption Reserve
for redemption of 14% Cumulative Preference Shares, and.
e) on the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
f) Based on the written communication received from the company, it had
complied with the provisions of section185 of the Companies act 2013.
g) Since the Central Government has not issued any notification as to
the rate at which the cess is to be paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
The Annexure referred to in paragraph 1 of the Our Report of even date
to the members of MAHA RASHTRA APEX CORPORATION LIMITED on the accounts
of the company for the year ended 31st March, 2014.
On the basis of such checks as we considered appropriate and according
to the information and explanation given to us during the course of our
audit, we report that:
1. The company has maintained proper records showing full particulars
including quantitative details and situation of its fixed assets.
(a) As explained to us, fixed assets have been physically verified by
the management once in a year; no material discrepancies were noticed
on such verification.
(b) We are informed that assets on lease are not physically verified as
most of the lease accounts are under legal proceedings and the value of
these assets are not significant.
2. The Company has informed us that stock on hire could not be
physically verified as most of the hire purchase accounts are irregular
and legal proceeding are in progress for recovery of dues.
3. a) As per the explanations furnished by the Management, during the
year the Company has not granted any loans, secured or unsecured to
Companies, Firms or other parties listed in the Register maintained
under Section 301 of the Companies Act, 1956.
b) We are informed that certain Companies to which loans were granted
earlier are now having common directors with the lending company on
account of change of directors subsequently. In the opinion of the
management, section 297 and 299 are not applicable to these companies
as per sub-section (6) of section 299 of the Companies Act, 1956.
c) Though the Company is persuading the borrowers to repay the loans,
we are of the opinion that more efforts are required to be put for the
recovery of these loans.
d) As per the information and explanations given to us, the Company has
not taken any loans, secured or unsecured, from companies, firms or
other parties listed in the register maintained under section 301 of
the Companies Act, 1956
4. In our opinion and according to the information and explanations
given to us, there is generally an adequate internal control procedure
commensurate with the size of the company and the nature of its
business, for the purchase of inventories & fixed assets and payment
for expenses & for sale of assets. During the course of our audit, no
major instance of continuing failure to correct any weaknesses in the
internal controls has been noticed.
5. We are informed by the Management that Register required to be
maintained u/s 301 is properly maintained and during the year Company
has not entered into any transactions which are required to be entered
in the Register maintained under section 301, as Section 297 and 299
are not applicable to transactions between two companies covered under
sub-section 6 of section 299 of the Companies Act, 1956. Though the
company had stopped repayment of deposits/debentures matured after 15th
April, 2002, in view of the Scheme of Restructure filed before the
Hon''ble High Court of Karnataka, it has started the repayment of
deposits/bonds as under the Scheme sanctioned by the Hon''ble High Court
of Karnataka as referred in Note No.3.1. and 3.2. All the instalment of
repayment of Bonds/Deposits as per scheme sanctioned by High Court of
Karnataka due for payment on 15th September and 15th June 2009 (refer
Note No3.1 and 3.2). The case filed by depositors before National
Consumer Forum, New Delhi is pending. We are informed by the management
that there are no orders by Company Law Board or National Company Law
Tribunal or Reserve Bank of India or any other Court or Tribunal.
6. The Company has not accepted any deposits from the public covered
under section 58A and 58AA of the Companies Act, 1956.
7. We are informed that the Company has discontinued the Internal Audit
system on account of discontinuance of its regular business from 15th
April, 2002.
8. The Central Government has not prescribed the maintenance of cost
records under Section 209(1)(d) of the Companies Act, 1956.
9. a. According to the information and explanations given to us, the
Company is generally regular in depositing with appropriate authorities
undisputed statutory dues including Provident Fund, Employees State
Insurance, Income-Tax, Wealth Tax, Service Tax and other statutory dues
applicable to it and there are no arrears of outstanding statutory dues
for a period of more than six months from the date they became payable.
b. According to the records of the Company, disputed Income-Tax has
been adjusted from the refund due and the Sales-Tax dues which has not
been deposited on account of dispute are given below:
(Rs. in lakhs)
Name of Nature of Forum where
the Statute Period Arrears dispute is pending Amount
Andhra Pradesh Sales Tax Sales Tax Appellate
Sales Tax Act 95-96 96-97 Tribunal 17.54
10. The net worth of the Company is completely eroded. The Company has
incurred cash loss of Rs. 119.44 lakhs during the year (previous year
the company has incurred cash loss. of Rs. 56.08 lakhs).
11. As per the information given by the company, there are no defaults
in repayment of dues to financial institutions or banks. In respect of
matured debentures and interest accrued there on upto 31.3.2002,
company is in the process of payment to debenture-holders as per the
Scheme of Compromise and Arrangement sanctioned by the Hon''ble High
Court of Karnataka on 8th October, 2004 (refer Note No. 3.1 and 3.2).
12. 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.
13. The Company is not a chit fund or a nidhi/mutual benefit
fund/society. Therefore, the provision of this clause of the Companies
(Auditor''s Report) Order, 2003 (as amended) is not applicable to the
Company.
14. The Company is not dealing or trading in shares, securities and
other investments. The shares, debentures and other securities held by
the Company as long term investments are held in its own name except to
the extent of exemption granted under section 49 of the Companies Act,
1956.
15. According to the information and explanations given to us, the
Company has not given any guarantees for loan taken by others from a
bank or financial institution.
16. During the year the Company has not taken term loans from banks or
financial institutions and there are no outstanding loans as on 31st
March, 2014.
17. During the year the Company has not raised any short term funds.
The Company is in the process of repaying the overdue long term funds,
(all are raised before 31.3.2002) as per the Scheme of Arrangement
sanctioned by the High Court of Karnataka (Refer Note No.3.2).
18. The Company has not made any allotment of shares during the year.
19. As per the information and explanations given to us the Company has
created charge in respect of debentures issued. As per the Scheme of
Restructure sanctioned by the High Court, the unpaid deposits also are
secured by charge on company''s financial assets (Refer Note No.3.1).
20. The Company has not raised any money by public issue during the
year.
21. Based on the audit procedures performed and the information and
explanations given to us, we report that no fraud on or by the Company
has been noticed or reported during the year, nor have we been informed
of such case by the management.
For RAO &SWAMI,
Chartered Accountants
FRN: 003105S
P V Shenoy
Place: Udupi (Partner)
Date: May 30, 2014 Membership No. : 020205
Mar 31, 2012
We have audited the attached Balance Sheet of MAHA RASHTRAAPEX
CORPORATION LIMITED as at 31st March, 2012 and the annexed Profit &
Loss Account for the year ended on that date. These financial
statements are the responsibility of he Company's Management. Our
responsibility is to express an opinion on these financial statements
based on ouraudit.
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 the Management, as well as evaluating the overall presentation of
the financial statements.
We believe that our audit provides are as on able basis for our opinion.
1. As required by the Companies (Auditor's Report) Order, 2003 as
amended by the Companies (Auditor's Report) (Amendment) 0rder2004
issued by the Central Government intermsofSection227(4A)ofthe
CompaniesAct,1956, wegiveintheannexure astatement on the matters
specified in Paragraphs 4 and 5 of the said order, to the extent
applicable to the Company.
2. Furtherto our comments in theAnnexure referred to in Paragraph (1)
above, we report that:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of
ouraudit.
b) In our opinion, proper books of account as required bylaw have been
kept by the Company so far as appears from examination of those books.
c) The Balance Sheet and Profit & Loss Account referred to in this
report are in agreement with the books of account.
d) On the basis of the 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 are disqualified as on
31st March,2012 from being appointed as Directors of this Company in
terms of Clause (g) of Sub-section (1) of Section 274 of the Companies
Act, 1956.
e) In our opinion, the Balance Sheet and Profit & Loss Account, dealt
with by this report, have been prepared in compliance with the
Accounting Standards referred to in Section 211 (3C) of the Companies
Act, 1956, except Note No.12 Other Disclosure to theAccounts. B(15) and
B(14) of regarding creation of Capital Redemption Reserve for
redemption of 14% Cumulative Preference Shares, and creation of
Deferred Tax Asset.
f) In terms of direction issued by RBI, we state that:
i) The Company has not obtained Credit Rating
ii) The Capital Adequacy Ratio is negative.
Hi) There has been some delay in submission of Statements to RBI.
iv) In view of the negative networth, all lendings and investments are
in excess of Credit Concentration Limit stipulated by the Reserve Bank
of India.
v) The company has encashed all the approved securities and utilized
for repayment of deposits.
g) Though the networth of the Company is negative, it has prepared the
accounts on "going concern" basis on the presumption that deficitin
operations will be effectively monitored (refer Note No.12B(5)).
h)
Byitsorderdated13thJune,2002,RBIhascancelledtheCertificateofRegistration
grantedtothe Company toact asNon- Banking Financial Company.
i) Accrued interest on deposits andbondswere provided upto 31.3.2002
only as per the Scheme of Restructure of the debts of the Company as
sanctioned by the Hon'ble High Court of Karnataka (refer Note
No12B(1)(a)).
j) The company has stopped repayment of deposits/bonds on maturity
dates, till the sanction of Scheme of Restructure by the Hon'ble High
Court of Karnataka on 8th October, 2004. Now the company has started
repayment under the sanctioned Scheme and the short fall in repayment
amounted to' 117.46 crores (refer Note No12.B(1) and (2)).AII the
instalments of repayment of deposits/bonds are as per scheme sanctioned
by High Court of Karnataka due for payment on 15th September 2009 and
15th June 2009 (referNote no12.B1 (e) and Note B(1)(f)).
k) Though the management is of he view that it will be able to monitor
effectively the deficit in operation, we are unable to comment on the
the ultimate readability of company's assets.
I) Provision has not been made as required under RBI Prudential Norms
since 1.4.2000. Had this been provided for, the net assets would have
been less and the accumulated loss would have been more by the
provision required (Refer Note No. 12 B(6)).
m) Subject to the comments made in Para (e), (f), (g), (h), (i), (j),
(k) and (I) above, in our opinion and to the best of our information
and according to the explanations given to us the said accounts read
together with the notes thereon give the information required by the
CompaniesAct, 1956, in the mannerso required andgiveatrueandfairview:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012 and,
(ii) in the case of the Profit & Loss Account, of the "Loss̢̈ forthe
year ended on thatdate.
iii) inthe caseofCash Flow statement, of the Cash Flow for the year
ended on thatdate.
ANNEXURE TO AUDITORS' REPORT
Referred to in Paragraph 1 of our report of even date:
i) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets. We are
informed that these fixed assets have been physically verified by the
Management once in a year and no serious discrepancies have been
noticed on such verification. Weare informed that assets on lease are
not physically verified as most ofthe lease accounts are under legal
proceedings and the value of these assets are not significant.
ii) The Company has informed usthat stock on hire could not be
physically verified as mostofthehirepurchaseaccountsare irregular and
legal proceeding are in progress for recovery of dues.
iii) a) As per the explanations furnished by the Management, during the
year the Company has not granted any loans, secured or
unsecured toCompanies, Firmsor other parties listed in the
RegistermaintainedunderSection 301 ofthe Companies Act, 1956.
b) We are informed that certain Companies to which loans were granted
earlier are now having common directors with the lending company on
account of change of directors subsequently. In the opinion of the
management, section 297 and 299 are not applicable to these companies
as per sub-section (6) of section 299 of the Companies Act, 1956.
c) Though the Company is persuading the borrowers to repay the loans,
we are of the opinion that more efforts are required to be put for the
recovery of these loans.
d) As per the information and explanations given to us, the Company has
not taken any loans, secured or unsecured, from companies, firms or
other parties listed in the register maintained undersection 301 of the
Companies Act, 1956.
iv) In our opinion and according to information and explanations given
to us, there is adequate internal control procedure commensurate with
the size ofthe Company and the nature of its business forthe purchase
and sale of assets. During the course of Audit, no majorweakness has
been noticed in the internal controls.
v) We are informed by the Management that Register required to be
maintained u/s 301 is properly maintained and during the year Company
has not entered into any transactions which are required to be entered
in the Register maintained under section 301, as Section 297 and 299
are notapplicable to transactions between two companies covered under
sub-section 6 ofsection 299 ofthe CompaniesAct, 1956.
vi) Though the company had stopped repayment of deposits/debentures
matured after 15th April, 2002, in view ofthe Scheme of Restructure
fled before the Hon'ble High Court of Karnataka, it has started the
repayment of deposits/bonds as under the Scheme sanctioned by the
Hon'ble High Court of Karnataka as referred in Note No. 12 B(1) and
B(2) .All the instalment of repayment of Bonds/Deposits as per scheme
sanctioned byHighCourtofKarnataka duefor payment on 15th September and
15th June 2009 (refer Note12 B(1) B(2)). The casefiled by depositors
before National Consumer Forum, New Delhi is pending. We are informed
by the management that there are no orders by Company Law Board or
National Company LawTribunal or Reserve Bankof India or any otherCourt
orTribunal.
vii) We are informed that the Company has discontinued the Internal
Audit system on account of discontinuance of its regular business from
15th April, 2002.
viii) The Central Government has not prescribed the maintenance of cost
records underSection 209(1)(d) ofthe CompaniesAct, 1956.
ix) a) According to the information and explanations given to us, the
Company is generally regular in depositing with appropriate authorities
undisputed statutory dues including Provident Fund, Employees State
Insurance, Income-Tax, Wealth Tax, Service Tax and other statutory dues
applicable to it and there are no arrears of outstanding statutory
duesfora period of more than six months from the date they became
payable.
b) According to the records of the Company, disputed Income-Tax
hasbeenadjustedfromtherefunddueandtheSales-Taxdues whichhas not been
deposited on account of dispute are given below:
(Rs. in lakhs)
Name of the Statute Nature of Period Forumwhere Amount
Arrears dispute is pending
Andhra Pradesh Sales Tax Act Sales Tax 95-96, 96-97
SalesTaxAppellateTribunal 17.54
x) ix).The networth of the Companyis completely eroded. The Company has
incurred cash loss of Rs. 90.13 lakhs during the year (previous year
the company has incurred cash loss, of Rs. 86.51 lakhs).
xi) As per the information given by the company, there are no defaults
in repayment of dues to financial institutions or banks. In respect of
matured debentures and interest accrued there on upto 31.3.2002,company
is in the process of payment to debenture-holders as per the Scheme of
Compromiseand Arrangement sanctioned by the Hon'ble High Court
ofKarnataka on 8th October, 2004 (refer Note 12 No. B(1) and (2))
xii) In our opinion, the Company has maintained adequate records where
the Company has granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
xiii) As the Company is not a Chit Fund, Clause 4(xiii) of the
Companies (Auditor's Report) Order 2003 as amended by the Companies
(Auditor's Report) (Amendment) 0rder2004 is not applicableto
theCompany.
xiv) The Company is not dealing or trading in shares, securities and
other investments. The shares, debentures and other securities held by
the Company as long term investments are held in its own name except to
the extent of exemption granted under section 49 of the Companies Act,
1956.
xv) As per the information and explanations given to us, the Company
has not given any guarantee for loans taken by others from bank or
financial institutions.
xvi) During the year theCompany has not taken term loans from banks or
financial institutions and there are no outstanding loans as on 31st
March, 2012.
xvii) During the year the Company has not raised any short term funds.
The Company is in the process of repaying the overdue long term funds,
(all are raised before 31,3.2002)as per the Scheme ofArrangement
sanctioned by the High Court ofKarnataka (Refer Note No. 12 B(2)).
xviii) The Company has not made any allotment of shares during the
year.
xix) As per the information and explanations given to us the Company
has created charge in respect of debentures issued.As per the Scheme of
Restructure sanctioned by the High Court, the unpaid deposits also are
secured by charge on company's financial assets (Refer Note No. 12 B
(1) (i)).
xx) The Company has not made any public issues of shares during the
year.
xxi) As per the explanations given to us and also on the basis of
verification made by us, we report that no fraud on or by the Company
has been noticed or reported during the course of audit.
for RAO & SWAMI,
Chartered Accountants
FRN.003105S UDUPI PVShenoy
August 14,2012 Partner
Membership No. 020205
Mar 31, 2010
We have audited the attac hed Balance Sheet of MAHARASHTRA APEX
CORPORATION LIMITED as at 31st March, 2010 and the annexed Profit &
Loss Account for the year ended on that date. These financial
statements are the responsibility of he Companys
Management Our respon sibility is toex press an opinionon 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 the Management, as well as evaluating the overall presentation of
the financial statements. We believe that our audit provides are as
onable basis for our opinion.
1. As required by the Companies (Auditors Report) Order, 2003 as
amended by the Companies (Auditors Report) (Amendment) Order 2004
issued by the Central Government in terms of Section 227 (4A)of the
Companies Act, 1956, we give in theannexure a statement on the matters
specified in Paragraphs 4 and 5 of the said order; to the extent
applicable to the Company.
2. Furtherto ourcomments in the Annexure referred to in Paragraph (1)
above, we report that:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit.
b) Inouropinion.properbooks ofaccountas required bylaw have been kept
by the Company sofaras appears from examination ofthose books
c) TheBalanceSheetandProfit&LossAccountreferredto in this report are in
agreement with the books of account.
d) On the basis of the written represent
ations received from the Directors as on31st March,2010 and taken on
record by the Board of
Directors, we report that none of the Directors are disqualified as on
31st March, 2010from being appointed as Directors of this
Company in terms of Clause(g) of Sub-section(1)of Section 274
of the Companies Act,1956.
e) In ouropinion,the Balance Sheet and Profit & Loss Account,
dealtwithby this
report, have been prepared in compliance with the Accounting Standards
referred to in Section 211 (3C) of the Companies Act, 1956, except Note
Nos. B(17) and B(16) of Schedule M regarding creation of Capital
Redemption Reserve for redemption of 14% Cumulative Preference Shares,
and creation of Deferred Tax Asset.
f) In terms of direction issued by RBI.we state that:
i)The Company has not obtained Credit Rating
ii) The Capital Adequacy Ratio is negative.
Hi) There has been some delay in submission of Statements to RBI.
iv) In view of the negative networth, all lendings and investments are
in excess of Credit Concentration Limit stipulated bythe Reserve
BankerIndia.
v) Thecompanyhasencashed all the approved securities and utilized for
repayment of deposits.
g) Though thenetworth ofthe Company is negative, it has prepared the
accounts on "going concern" basis on the presumption that dentin
operations will be effectively monitored (refer Note No.B(3) of
Schedule-M).
h) By its order dated 13th June, 2002, RBI has cancelled the
Certificate of Registration granted to the Company toad as Non- Banking
Financial Company.
i) Accrued intereston deposits andbondswere provided upto 31.3.2002only
asper theSchemeof Restructure of the debts of theCompany as sancLed by
the Honble High Court of Lnataka (refer NLB(1)(a) of Schedule-M).
j) The company has stopped repayment ofdeposits/bonds on maturity dates,
till the sanction of Scheme of Restructure by the Honble High Court of
Karnataka on 8th October, 2004. Now the company has started repayment
under the sanctioned Scheme and the short fall in repayment amounted to
Rs.135.91 crores (refer Note Nos.B(1) and 2) of Schedule-M). The fmal
instalments of repayment of deposits/bonds are as per scheme sanctioned
by High Court of Karnataka due for payment on 15th September 2009 and
15th June 2009 (refer Note no 1(e) and Note (m)-TrLtment of change in
Account toHardship Payment of Bonds/Deposits (refer Note No.B(4) of
scheduleM.
k) Though the management is of the view that it will be able to monitor
effectively the deficit in operation, we are unable to commentonthe the
ultimate readability of companys assets.
I) Provision has not been made as required under RBI Prudential Norms
since 1.4.2000. Had this been provided for, the net assetswouldhave
been less and the accumulated loss would have been more by the
provision required (Refer Note No. B(6) ofSchedule-M).
m) Subject to the comments made in Para (e), (f), (g), (h), (i), (j),
(k) and (I) above, in our opinion and to the best of our information
and according to the explanations given to us the said accounts read
together with the notes thereon give the information required by the
CompaniesAct, 1956 in the mannerso required and give a true and fair
view:
(i) in the case of the Balance Sheet, of the state of affairs of
the Company a sat 31 st March,2010 and,
(ii) in the case of the Profit & Loss Account, of the" Profit"
for the year ended on that date.
iii) in the case of Cash Flow statement,ofthe Cash Flow for the year
ended on that date.
ANNEXURE TO AUDITORSREPORT Referred to in Paragraph 1 of our report
of even date:
i). The Company has maintained proper records showing full particulars
including quantitative details and situation offxed assets. We are
informed that these fixed assets have been physically verified by the
Management once in a year and no serious discrepancies have been
noticed on such verifcation. Weare informed that assets on lease are
not physically verified a most ofthe lease accounts are underlegal
proceedingsandthevalueoftheseassetsarenotsignificant.
ii). The Company has informed usthat stockon hire could not be
physically verified as mostofthehirepurchaseaccountsare irregular and
legal proceeding are in progress for recovery of dues.
iii) a) As per the explanations furnished by the Management,during the
year the Company has not granted any loans, secured or unsecured
toCompanies, Firmsor other parties listed in the Register maintained
under Section 301 of the Companies Act, 1956.
b)We are informed that certain Companies to which loans were granted
earlier are now having common directors with the lending company on
account of change of directors subsequently. In the opinion of the
management, section 297 and 299 are not applicable to these companies
as persub-section(6)ofsection299oftheCompaniesAct,1956.
c) Though the Company is persuading the borrowers to repay the loans,
we are of the opinion that more efforts are required to be put forthe
recovery of these loans.
d) As per the information and explanations given to us, the Company has
not taken any loans, secured or unsecured, from companies, frms or
other parties listed in the register maintained under section 301 of
the Companies Act, 1956.
iv). In our opinion and according to information and explanations given
to us, there is adequate internal control procedure commensurate with
the size ofthe Company and the nature of its business for the purchase
and sale of assets. During the course of Audit, no majorweakness has
been noticed in the internal controls.
v). We are informed by the Management that Register required to be
maintained u/s 301 is properly maintained and during the year Company
has not entered into any transactions which are required to be entered
in the Register maintained under section 301, as Section 297 and 299
are notapplicable to transactions between two companies covered under
sub-section 6 ofsection 299 ofthe CompaniesAct, 1956.
vi). Though the company had stopped repayment of deposits/debentures
matured after 15th April, 2002, in view ofthe Scheme of Restructure
fled beforethe Honbk High Court of Karnataka, it has started the
repayment of deposits/bondsas under the Scheme sanctioned by the
Honble High Court of Karnataka as referred in Note No. B(1) and B(2)
of Schedule-M The final instalment of repayment of Bonds/Deposits as
per scheme sanctioned byHighCourtofKamataka duefor payment on 15th
September and 15th June2009(referNoteB(1)B(2)ofschedules. The case
filed by depositor before National Consumer Forum, New Delhi, criminal
cases fled atJMFC.Yellapur and JMFC, Davangere also are pending. We are
informed by the management that there are no orders by Company Law
Board or National Company Law Tribunal or Reserve
BankoflndiaoranyotherCourtorTribunal.
vii) We are informed that the Company has discontinued the lntemal
Audit system on account of discontinuance of its regular business
from 15th April, 2002.
viii) The Central Government has not prescribed the maintenance
of costre cord sunder Section 209(1) (d) of the Companies Act, 1956.
ix) a) According to the information and explanations given to us, the
Company is generally regular in depositing with appropriate authorities
undisputed statutory dues including Provident Fund Employees State
Insurance, Income-Tax, Wealth Tax, Service Tax and other statutory dues
applirabletoit andttiere arenoar^arsofoutstandingstatutory duesfora
periodofmorethansixmonthslroiTithedatBtheybecamepayable.
b) According to the records ofthe Company, disputed Income-Tax has been
adjusted from the refund due and the Sales-Tax dueswhich has not been
deposited on account of dispute are given below:
(Rs. in lakhs)
Name ofthe Statute Nature of Period
Arrears Forum where dispute is
pending Amount
Andhra Pradesh Sales
TaxAct Sales Tax 95-96
& 96-97 Sales Tax Appellate
Tribunal 17.54
x). The net worth of the Companyis completely eroded. The Company has
not incurred cash loss during the year (previous year incurred cash
lossofRs. 226 lakhs).
xi) As per the information given by the company, there are no defaults
in repayment of dues to financial institutions or banks. In respect of
matured debenture sandinte restaccrued^ of Compromise and Arrangement
sanctioned bytheHonble HighCourt
of Kamataka on 8th October, 2004 (referNoteNo.B( 1) of Schedule-M).
xii) In our opinion, the Company has maintained adequate records where
the Company has granted loans and advances on the basis of security by
way of pledge of shares debentures and other securities.
xiii) As the Company is not a Chit Fund, Clause 4(xiii) of the
Companies (Auditors Report) Order 2003 as amended by the Companies
(Auditors Report) (Amendment) Order 2004 is not applicable
to the Company.
xiv) The Company is not dealing or trading in shares, securities and
other investments. The shares, debentures and other securities held by
the Company as long term investments are held in its own name except to
the extent of exemption granted under section 49 ofthe CompaniesAct,
1956in respectofSubsidiary, RivieraSteels Pvt.Ltd.
xv) As per the information and explanations given to us, the Company
has not given any guarantee for loans taken by others from bank or
financial institutions.
xvi) During the year the Company hasnot taken term loans from banks or
financial institutions and there are no outstanding loansason31st March
2010
xvii) During the year the Company has not raised any short term funds.
The Company is in the process of repaying the overdue long term funds,
(all are raised before 31.3.2002) as perthe Scheme of Arngements
anctioned byt he High Court of Kamataka (Refer Note No.B(2)).
xviii) The Company has not made any allotment of shares during the
year.
xix) As per the information and explanations given to us the Company
has created charge in respect of debentures issued .As per the Scheme
of Restructure sanctioned by the High Court, the unpaid deposits also
are secured by charge on companysf nancial assets (Refer Note No.B(1
)(i)).
xx) The Company has not made any public issues.
xxi) As per the explanations given to us and also on the basis of
verification made by us, we report that no fraud on or by the Company
has been noticed or reported during the course of audit.
for RAO & SWAM,
Chartered Accountants
FRN.003105S
UDUPI PV Shenoy
Augusts,2010 Partner
Membership No. 020205