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Auditor Report of Motor & General Finance Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of The Motor & General Finance 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

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation 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 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 thereunder.

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the company as at March 31,2015 and its loss and its 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 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 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 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 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; and

(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 has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note no. 26 of the financial statements.

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 Independent Auditor's Report

(The Annexure referred to in paragraph 1 of Report on Other Legal and Regulatory Requirements of even date on the financial statements of The Motor & General Finance Limited for the year ended March 31,2015)

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

(b) As per information and explanations given to us, fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

ii. (a) As explained to us physical verification of stock in trade comprising of commercial project has been conducted by the management at reasonable intervals. In our opinion the frequency of verifications is reasonable.

(b) In our opinion the procedures of physical verification of stock in trade comprising of commercial project followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) On the basis of our examination of the records of the stock in trade comprising of commercial project, we are of the opinion that the company is maintaining proper records. No material discrepancies were noticed on verification between the physical record and book records.

iii. According to the information and explanations given to us, the company has granted unsecured loans, to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.

(a) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of repayment of principal amount does not arise. However the interest is being paid regularly.

(b) As stated above no repayment schedule have been specified and there are no overdue amounts in excess of Rs. one lacs.

iv. In our opinion, and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of stock in trade, fixed assets and 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, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system

v. The company has not accepted any deposits within the meaning of sections 73 to 76 of the Act. Therefore, the provisions of paragraph 3 (v) of the Order are not applicable to the company.

vi. The company has made and maintained cost accounts and records specified by the Central Government under section 148(1) of the Companies Act, 2013. However, we have not made a detailed examination of these accounts and records with a view to determine whether they are accurate or complete.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the company, amounts deducted/accrued in the books of accounts in respect of undisputed statutory dues including income tax, provident fund, employees' state insurance, sales tax, wealth tax, service tax and other material statutory dues, as applicable to the company, have generally been regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed demand payable in respect of aforesaid statutory dues were in 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 income tax, sales tax, wealth tax and service tax which have not been deposited on account of any dispute, other than the following:-

Name of the statute Nature of dues/Year Amount in Rs.

Electricity Act Electricity charges 6,924,304 (1993-94 & 2004)

Employee State ESIC's Dues 7,475,606 Insurance (1989-2010) Corporation Act,1948

Finance Act Services tax (2008-09) 10,351,192



Name of the statute Forum where dispute is pending

Electricity Act BSES Yamuna Power Ltd.

Employee State ESIC Court Insurance Corporation Act,1948

Finance Act Commissioner of Service Tax

(c) According to the information and explanations given to us and the records of the company examined by us, no amount required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under.

viii. In our opinion, the accumulated losses of the company are not more than 50% of its net worth. The company has not incurred any cash loss during the financial year covered by our audit and in the immediately preceding financial year.

ix. Based on our examination of the records and according to the information and explanations given to us the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

x. In our opinion and 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. Accordingly, the provisions of paragraph 3(x) of the Order are not applicable to the company.

xi. In our opinion and according to the information and explanations given to us, and on overall examination of the Balance Sheet of the company, we report that term loans have been applied for the purpose for which they were obtained.

xii. In course of our examination of the books and records of the company, carried out in accordance with the generally accepted auditing practices in India, we have not come across any instance of fraud on or by the company, and according to the information and explanations given to us, no fraud was noticed or reported during the year by the management.

For S. N. Dhawan & Co. Chartered Accountants Firm's Registration. No.: 000050N

(S. K. Khattar) Place: New Delhi Partner Date: May 29, 2015 Membership No. 084993


Mar 31, 2014

We have audited the accompanying financial statements of The Motor & General Finance Limited ("the Company"), 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 notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the 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.

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 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 of the Company''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 qualified audit opinion.

Basis for Qualified Opinion

Provision of Rs. 511.26 lacs has not been made for diminution in the value of noncurrent long term investments. (Refer Note No. 26(iv)). Had our aforesaid observation been considered, the profits for the year would have been Rs. (184.75) lacs (as against the reported figure of Rs. 326.51 lacs) and the deficit in statement of profit & loss would have been Rs. 1904.46 Lacs (as against the reported figure of Rs. 1393.20Lacs).

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 matter 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 profit for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("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 and proper returns adequate for the purposes of our audit;

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. except for the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the accounting standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013;

e. On the basis of written representations received from the Directors, as at March 31, 2014 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as at March 31, 2014 from being appointed as a Director under clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

Annexure to Independent Auditor''s Report

(Referred to in Paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date on the accounts of The Motor & General Finance Limited for the year ended March 31, 2014)

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

b) As per information and explanations given to us, fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

c) According to the information and explanations given to us, the Company has not disposed off a substantial part of its fixed assets during the year.

ii) a) As explained to us physical verification of stock in trade comprising of commercial project has been conducted by the management at reasonable intervals. In our opinion the frequency of verifications is reasonable.

b) In our opinion the procedures of physical verification of stock in trade comprising of commercial project followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) On the basis of our examination of the records of the stock in trade comprising of commercial project, we are of the opinion that the Company is maintaining proper records. No material discrepancies were noticed on verification between the physical record and book records.

(iii) (a) The Company has granted Inter Corporate Deposits to one company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of such inter corporate deposit including interest given to such party was Rs. 4211.21 lacs.

(b) In our opinion the rate of interest and other terms and conditions on which Inter Corporate Deposits have been given, are prima facie not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of repayment of principal amount does not arise. However the interest is being paid regularly.

(d) As stated above no repayment schedule have been specified and there are no overdue amounts in excess of Rs. one lac.

(e) The Company has taken Inter Corporate Deposits from one company and interest free advances from four companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of such loans and advances including interest was Rs. 5441.16 lacs.

(f) In our opinion, the other terms and conditions on which Inter Corporate Deposits and interest free advances have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company.

(g) The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest wherever stipulated.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of the business with regard to purchase of fixed assets, purchase and transfer of stock in trade, sale of goods and services during the year. During the course of our audit we have not come across any continuing failure to correct major weaknesses in the internal control systems.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

(vii) The Company has an internal audit system. However, functioning thereof (including extent of coverage) needs to be strengthened to make it commensurate with the size and nature of its business.

(viii) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956.

(ix) (a) According to the information and explanations given to us and according to the records produced before us for our verification, the Company is generally regular in depositing, with appropriate authorities the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Cess and any other material statutory dues applicable to it.

(b) According to the information and explanations furnished to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Service tax and Cess were in arrears as at March 31, 2014 for a period of more than six months from the date they become payable.

(c) According to the information and explanations given to us, there are no dues of Income Tax, Sales Tax, Wealth Tax, Service Tax and Cess which have not been deposited on account of any dispute, other than the following:-

Name of the statute Nature of dues Rs. Forum where dispute is in Lacs pending

Electricity Act Electricity 69.24 BSES Yamuna Power Ltd. charges (1993-94 & 2004)

x) In our opinion, the accumulated losses of the Company are not more than 50% of its net worth. The Company has not incurred any cash losses during the financial year covered by our audit and in the immediately preceding financial year.

xi) Based on our examination of the records and according to the information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

xii) 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.

xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable.

xiv) In our opinion the Company is not dealing or trading in shares, securities, debentures or other investments. Therefore, the provisions of clause 4 (xiv) of the Order are not applicable.

xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

xvi) According to the information and explanations given to us, the term loans availed by the Company were applied for the purposes for which they were obtained.

xvii) According to the information and explanations given to us, and on overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments.

xviii) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix) The Company has not issued any debentures during the year.

xx) The Company has not raised any money through public issue during the year.

xxi) To the best of our knowledge and belief and 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 our audit.

For S. N. Dhawan & Co., Chartered Accountants FRN-000050N

(S. K. Khattar) Place: New Delhi Partner Date : May 30, 2014 M. No.084993


Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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 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. 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 qualified audit opinion.

Basis for Qualified Opinion

Provision of Rs 280.43 lacs has not been made for diminution in the value of non current long term investments. (Refer Note No. 30). Had our aforesaid observation been considered, the profits for the year would have been Rs. 49.16 lacs (as against the reported figure of Rs. 329.58 lacs) and the deficit in statement of profit & loss would have been Rs. 1944.05 Lacs (as against the reported figure of Rs. 1719.71Lacs).

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 matter 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, 2013;

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

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

Emphasis of Matter

Without qualifying our opinion we draw attention:

There is non-compliance of the provisions of Non Banking Financial Companies Prudential Norms (Reserve Bank) Directions 1998 with regard to maintenance of Credit Concentration/Investment Norms in respect of lending to one of the Company where these are exceeding the limits. (Refer Note No.31)

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 and proper returns adequate for the purposes of our audit;

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. except for the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the accounting standards referred to in subsection (3C) of section 211 of the Act;

e. On the basis of written representations received from the Directors, as at March 31, 2013 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as at March 31, 2013 from being appointed as a Director under clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

f. 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.

Annexure to Independent Auditor''s Report

(Referred to in Paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date on the accounts of The Motor & General Finance Limited for the year ended March 31, 2013)

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

(b) As per information and explanations given to us, fixed assets other than lease assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification. For Assets on Lease, confirmations from lessees, as regards their physical existence, were not available.

(c) According to the information and explanations given to us, the Company has not disposed off a substantial part of its fixed assets during the year.

ii) The Company does not have any inventory. Therefore, the provisions of clause 4 (ii) (a), (b) & (c) of the Order, are not applicable.

(iii) (a) The Company has granted Inter Corporate Deposits to one company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of such inter corporate deposit given to such party was Rs. 3459 lacs.

(b) In our opinion the rate of interest and other terms and conditions on which Inter Corporate Deposits have been given, are prima facie not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of repayment of principal amount does not arise. However the interest is being paid regularly.

(d) As stated above no repayment schedule have been specified and there are no overdue amounts in excess of Rs. One lacs.

(e) The Company has taken Inter Corporate Deposits from one company and interest free advances from two companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of such loans and advance taken were. Rs. 2250 lacs & 1677 lacs respectively.

(f) In our opinion, the other terms and conditions on which Inter Corporate Deposits and interest free advances have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company.

(g) The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest wherever stipulated.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of the business with regard to purchase of fixed assets. As explained, there was neither purchase of inventories nor sale of goods and services during the year. During the course of our audit we have not come across any continuing failure to correct major weaknesses in the internal control systems.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 read with Non Banking Financial Companies Acceptance of Public Deposit (Reserve Bank) Directions 1998.

(vii) The Company has an internal audit system. However, functioning thereof (including extent of coverage) needs to be strengthened to make it commensurate with the size and nature of its business.

(viii) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956.

ix) (a) According to the information and explanations given to us and according to the records produced before us for our verification, the Company is generally regular in depositing, with appropriate authorities the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax and any other material statutory dues applicable to it.

(b) According to the information and explanations furnished to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax and Sales Tax etc. were in arrears as at March 31, 2013 for a period of more than six months from the date they become payable.

(c) According to the information and explanations given to us, there are no dues of Income Tax, Sales Tax, Wealth Tax and Service Tax which have not been deposited on account of any dispute, other than the following:-

Name of the statute Nature of dues Rs. in Lacs Forum where dispute is pending

Sales Tax Act Transfer of Right to use 4.82 Before U. P. Tribunal, Deputy (1970-71 to 1995-96) Commissioner and Assistant Commissioner

Electricity Act Electricity charges 69.92 BSES Yamuna Power Ltd. (1993-94 & 2004)

Delhi Municipal Interest on Property Tax 47.52 Municipal Taxation Tribunal Corporation Act.

x) In our opinion, the accumulated losses of the Company are not more than 50% of its net worth. The Company has not incurred any cash losses during the financial year covered by our audit and in the immediately preceding financial year.

xi) Based on our examination of the records and according to the information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

xii) 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.

xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable.

xiv) In our opinion the Company is not dealing or trading in shares, securities, debentures or other investments. Therefore, the provisions of clause 4 (xiv) of the Order are not applicable.

xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

xvi) According to the information and explanations given to us, the term loans availed by the Company were applied for the purposes for which they were obtained.

xvii) According to the information and explanations given to us, and on overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments.

xviii) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix) The Company has not issued any debentures during the year.

xx) The Company has not raised any money through public issue during the year.

xxi) To the best of our knowledge and belief and 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 our audit.



For S. N. Dhawan & Co.,

Chartered Accountants

FRN-000050N

(S. K. Khattar)

Place: New Delhi Partner

Date : May 30, 2013 M. No.84993


Mar 31, 2012

We have audited the attached Balance Sheet of The Motor & General Finance Limited as at March 31, 2012, the Statement of Profit & Loss and also the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 provides a reasonable basis for our opinion.

1. As required by the Companies (Auditors' Report) Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5, of the said Order.

2. Attention is drawn to Note No. 29 regarding Inter-Corporate Deposits given to Jayabharat Credit Limited in which directors are interested, on the terms and conditions as stated therein.

3. Further to our comments in the Annexure referred to in paragraph 1 above, we report that :

i) Provision of Rs. 305.98 lacs has not been made for diminution in the value of noncurrent long term permanent investments. (ReferNote No.30).

ii) There is non-compliance of the provisions of Non Banking Financial Companies Prudential Norms (Reserve Bank) Directions 1998, with regard to maintenance of Credit Concentration/Investment Norms in respect of lending to one of the Company where these are exceeding the limits. (Refer Note No.31)

4. We further 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, the Statement of Profit & Loss and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, the Balance Sheet, the Statement of Profit & Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 subject to our comments in our paragraphs 3 (i) above.

e) On the basis of written representations received from the Directors, as at March 31, 2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as at March 31, 2012 from being appointed as a Director under clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

We further report that, without considering the observation made in paragraph 3 (ii) above the effect of which could not be determined, had the observation made by us in paragraph 3 (i) above been considered, the profits for the year would have been Rs. 647.09 lacs (as against the reported figure of Rs. 953.07 lacs) and the deficit in statement of profit & loss would have been Rs. 2289.35 Lacs (as against the reported figure of Rs.1983.38 Lacs).

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 Significant Accounting Policies and Notes thereon give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2012;

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

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

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON ACCOUNTS OF THE MOTOR &

GENERAL FINANCE LIMITED FOR THE YEAR ENDED MARCH 31, 2012

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

fixed assets except for assets on lease.

(b) As per information and explanations given to us, fixed assets other than lease assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification. For Assets on Lease, confirmations from lessees, as regards theirphysical existence, were not available.

(c) According to the information and explanations given to us, the Company has not disposed off a substantial part of its fixed assets during the year.

ii) The Company does not have any inventory. Therefore, the provisions of clause 4 (ii) (a), (b) & (c) of the Order, are not applicable.

iii) (a) The Company has granted Inter Corporate Deposits to one company covered in the register maintained under section

301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of such inter corporate deposit given to such party was Rs. 2541.00 lacs.

(b) In our opinion the rate of interest and other terms and conditions on which Inter Corporate Deposits have been given, are prima facie not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of repayment of principal amount does not arise. However the interest is being paid regularly.

(d) The Company has taken Inter Corporate Deposits/Advances (including interest free advances from two parties) from three companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 2012.00 lacs and the year-end balance of loans taken from such parties was Rs. 1476.00 lacs.

(e) In our opinion, the other terms and conditions on which Inter Corporate Deposits/Advances (including interest free advances) have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company.

(f) The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest wherever stipulated.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of the business with regard to purchase of fixed assets. As explained, there was neither purchase of inventories nor sale of goods and services during the year. During the course of our audit we have not come across any continuing failure to correct major weaknesses in the internal control systems.

(v) (a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or

arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of rupees five lacs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 read with Non Banking Financial Companies Acceptance of Public Deposit (Reserve Bank) Directions, 1998.

(vii) The Company has an internal audit system. However, functioning thereof (including extent of coverage) needs to be strengthened to make it commensurate with the size and nature of its business.

(viii) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956.

ix) (a) According to the information and explanations given to us and according to the records produced before us for our

verification, the Company is generally regular in depositing, with appropriate authorities the undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax and any other material statutory dues applicable to it.

(b) According to the information and explanations furnished to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax and Sales Tax etc. were in arrears as at March 31, 2012 for a period of more than six months from the date they become payable.

(c) According to the information and explanations given to us, there are no dues of Income Tax, Sales Tax, Wealth Tax and Service Tax which have not been deposited on account of any dispute, other than the following:-

Name of the statute Nature of dues Rs. in Lacs Forum where dispute is pending

Sales Tax Act Transfer of Right to use 4.24 Before U. P. Tribunal, Deputy (1970-71 to 1995-96) Commissioner and Assistant Commissioner

Electricity Act Electricity charges 69.24 BSES Yamuna Power Ltd. (1993-94 & 2004)

x) In our opinion, the accumulated losses of the Company are not more than 50% of its net worth. The Company has not incurred any cash losses during the financial year covered by our audit and in the immediately preceding financial year.

xi) Based on our examination of the records and according to the information and explanations given to us the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.

xii) 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.

xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable.

xiv) In our opinion the Company is not dealing or trading in shares, securities, debentures or other investments. Therefore, the provisions of clause 4 (xiv) of the Order are not applicable.

xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

xvi) According to the information and explanations given to us, the term loans availed by the Company were applied for the purposes for which they were obtained.

xvii) According to the information and explanations given to us, and on overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investments.

xviii) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix) The Company has not issued any debentures during the year.

xx) The Company has not raised any money through public issue during the year.

xxi) To the best of our knowledge and belief and 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 our audit.

For S. N. Dhawan & Co.,

Chartered Accountants

Firm Reg. No.000050N

(S. K. Khattar) Partner

M. No.84993

Place: New Delhi Date : August 23, 2012

 
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