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Auditor Report of Regency Hospitals Ltd. Company
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Auditor Report of Regency Hospitals Ltd.

Mar 31, 2015

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying standalone financial statements of REGENCY HOSPITALS LIMITED ("the Company"), which comprises the Balance Sheet as at March 31, 2015, the Profit and Loss Statement, the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

MANAGEMENT'S RESPONSIBILITY FOR THE STANDALONE 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 standalone 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.

AUDITORS' RESPONSIBILITY

Our responsibility is to express an opinion on these standalone 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 misstatements.

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 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 standalone financial statements.

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 profit and its cash flows for the year ended on that date.

Our opinion is not qualified / modified in respect of this matter.

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 Section 143 of the Act , we give in the Annexure a statement on the matters specified in paragraphs 3 of the order.

2. As required by section 143(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 accounts 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 the Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, the Statement of the Profit & Loss Account and Cash Flow statement comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dt.13th September,2013 of the Ministry of Corporate affairs in respect of Section 133 of the Companies Act,2013.

(e) In our opinion there are no financial transactions or matters carried by the company which have any adverse effect on the functioning of the Company.

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

(g) In our opinion, adequate internal financial controls systems are in place and such controls are operating effectively in the company.

(h) On the basis of written representation received from the Directors and taken on record by the Board of Directors We report that :

i. The company has disclosed the impact of pending litigation on its financial position in its financial

ii. The company has made provision of all material foreseeable losses as required under any law or accounting standards under long term contracts entered by the company including derivative contracts .

iii. There is no amount outstanding which required to be transferred ,to Investor Education and Protection fund by the Company.

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 1 under the heading of "report on other legal and regulatory requirements" of our report of even date)

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

b) As informed to us , the fixed assets have been physically verified by the Management during the year . As informed to us , no discrepancies noticed during such physical verification .

ii. In respect of the Company's Inventories:

a. Inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments have been physically verified during the period by the management. In our opinion the frequency of verification is reasonable.

b. In our opinion and according to explanations given to us, the procedures of physical verification of inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. In our opinion and according to information and explanations given to us, and on the basis of our examination, the company is maintaining proper records of inventories. Further in our opinion and information and explanations given to us the discrepancies noticed on verification between the physical stock and the book records were not material and same have been properly dealt within the books of accounts.

iii. a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Therefore, the provisions of sub-clauses (a) & (b) of clause 3(iii) of CARO are not applicable.

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

v. The Company has not accepted any deposits from the public. Hence, the provisions of Section 73 to Sec 76 of the Companies Act 2013, and the Rules framed thereunder do not apply to this Company.

vi. To the base of our knowledge and according to the information given to us the Company has maintained the Cost records as prescribed by the Central Government under Section 148(1) of the Companies Act, 2013.

vii. a) According to the information and explanations given to us, no undisputed amounts payable by the Company in respect of Income Tax, Sales Tax, Customs Duty, Excise Duty and Service tax were in arrears as at 31st March, 2015 for a period of more than six months from the date they became payable.

b) According the information and explanation give to us, there are no dues of sales tax, income tax, customs duty, excise duty, service tax and cess which have not been deposited on account of any dispute except following:-

Nature of the Nature of Amount Amount Statute Dues (Rs.in Lacs) Deposited (Rs. In Lacs)

Custom Act, Custom Duty 38.45 19.23 1962

Nature of the Statute Period to which Forum where The amount Dispute is pending Relates

Custom Act, 1962 1990-93 Appeal filed in Allahabad High Court

c) According to the information and explanations given to us, company do not have any outstanding amount which was 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 thereunder.

viii. There are no accumulated losses of the Company as on March 31, 2015. The Company has not incurred any cash losses during the financial year covered by our audit and the immediately preceding financial year.

ix. According to the records of the Company examined by us and information and explanations give to us, the Company has not defaulted in repayment of dues to financial Institutions or Banks.

x. In our opinion and according to the information and explanation given to us, the terms & conditions of the guarantee given by the Company for loan taken by associate Company from Bank during the year are not prejudicial to the interest of the Company.

xi. According to the information and explanations given to us, the term loans have been applied for the purposes for which they have obtained.

xii. 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 was noticed or reported during the financial year.

For JAIN DHINGRA & ASSOCIATES

Chartered Accountants

Firm Registration No.:000987C

R.N.Dhingra

Partner

Membership No.15385

New Delhi, 30th May, 2015


Mar 31, 2014

We have audited the accompanying financial statements of REGENCY HOSPITAL LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2014, and the Statement of Profit & 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 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 Accounting Standards notified under the Companies Act,1956 (''the Act") read with General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 and in accordance with the accounting principles generally accepted in India. 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 of these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

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:

(a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2014;

(b) In the case of the Statement of Profit and Loss, of 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.

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 Section 227 (4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 & 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 accounts 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 the 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 the Profit & Loss, and the Cash Flow Statement comply with Accounting Standards notified under the Act read with General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

On the basis of written representation received from the Directors as on 31st March, 2014, taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2014 from being appointed as a director in terms of section 274(1)(g) of the Act..

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

i. In respect of its Fixed Assets :

a. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets on the basis of available information.

b. As explained to us, all fixed assets have been physically verified by the management in phased periodical manner, which in our opinion is reasonable, having regard to the size of the company and nature of its assets. No material discrepancies were noticed on such physical verification.

c. The Company has not disposed off its any fixed assets during the year.

d. Based on our scrutiny of records of the Company and the information and explanations received by us, we report there was no sale of assets made during the financial year. Hence the question of reporting whether the sale of any substantial part of the fixed assets has affected the going concern of the Company does not arise.

ii. In respect of the Company''s Inventories:

a. Inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments have been physically verified during the period by the management. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to information and explanations given to us, the procedures of physical verification of inventories of medicines, stores, spares, consumables, lab materials and surgical instruments followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. In our opinion and according to information and explanations given to us, and on the basis of our examination, the company has maintained proper records of inventories. As explained to us, the discrepancies noticed on verification between the physical stock and the book records were not material and same have been properly dealt within the books of accounts.

iii. In respect of the loans, secured or unsecured, granted or taken by the Company to/ from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 :

a. As informed, the Company has not granted any loans secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the provisions of sub-clauses (a) to (d) of clause 4(iii)

b. The Company has taken unsecured loans from 7 parties, covered in the register maintained under section 301 of the Companies Act, 1956.The maximum amount involved during the period and balances outstanding of said loans at end of the year were aggregating to Rs 555.27 Lacs and Rs 549.77 Lacs respectively.

c. In our opinion, the rate of interest and other terms and conditions on which loan has been taken from 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.

d. Such Loan is not due for repayment.

iv. In our opinion and according to the information and explanations given to us there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of stores, medicines and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in internal control system of the Company.

v. In respect of contracts or arrangements entered in the register maintained pursuance of Section 301 of the Companies Act,1956 to the best of our knowledge and belief and according to information and explanation given to us :

a. The particulars of contracts or arrangements referred to in Section 301 that were needed to be entered in the Register maintained under the section have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts / 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 each party during the period have been made at prices, which are reasonable having, to regard to prevailing market prices at relevant time.

vi. According to information and explanations given to us , the Company has not accepted any deposits from the public. Hence, the provisions of Section 58A and 58AA of the Companies Act 1956, and the Companies (Acceptance of Deposits) Rules, 1975, do not apply to this Company.

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

viii. According to information and explanation provided by the management of the Company, is not engaged in production, processing, manufacturing or mining activities. Hence the provisions of clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, do not apply to the Company. Hence in our opinion no comment on maintenance of cost records under section 209(1)(d) is required.

ix. a) According to information and explanations given to us and on the basis of our examination of the Books of account, the Company has been generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees'' state Insurance, Income Tax, Sales Tax, Wealth Tax, Service tax, Customs duty, Cess and other material statutory dues applicable to it. In respect of aforesaid dues ,there were no undisputed dues payable by the Company, were in arrears as at 31st March, 2014 for a period of more than six months from the date they became payable.

b) According the information and explanation give to us, there are no dues of sales tax, income tax, service tax , wealth tax, which have not been deposited with the appropriate authority on account of any dispute except following

Nature of Nature of Amount Amount Period to which Forum where the Statute Dues (Rs.in Deposited The amount Dispute is Lacs) Rs.In Lacs Relates pending Custom Act, Custom Duty 38.45 19.23 1990 -93 Appeal filed in 1962 All ahabad High Court

x. The Company does not have any accumulated losses as at 31st March, 2014 and not incurred cash losses during the financial year and during the immediately preceding financial period.

xi. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial Institutions , banks and debenture holder .

xii. According to the explanations given to us and based on available information, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion the company is not Chit Fund or a Nidhi/ Mutual benefit fund / Society. Therefore the provisions of clause 4(xiii) of the order (as amended) are not applicable to the company.

xiv. In respect of dealing/ trading in share securities, debentures and other investments, in our opinion and according to information and explanation given to us, generally did not deal or trade in it. However on short term basis, surplus funds were invested in mutual funds for which proper records of transaction have been maintained by the company in its own name.

xv. In our opinion and according to information and explanations given to us, the terms and conditions of guarantees given by the company for loans taken by subsidiary Company from banks during the year are not prime facie prejudicial to the interest of the Company. .

xvi. On the basis of records examined by us and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

xvii. According to information and explanations given to us and on an overall examination of the Balance sheet of the Company we are of the opinion that there were no funds raised on short term basis that have been used for long term investments.

ixviii. During the period, 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 had issued 11% Unsecured Fully Convertible Debentures to IFCI Venture Capital Fund Limited, which has been redeemed during the year and there has been no outstanding debentures as on 31st March, 2014.

xx. During the year, the Company has not raised money by Public Issue. Hence, the question of disclosure and verification of end use of such monies does not arise.

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 was noticed or reported during the year.

For JAIN DHINGRA & ASSOCIATES Chartered Accountants Firm Registration No.:000987C

R.N.Dhingra Partner Membership No.15385

Kanpur

14th August, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of REGENCY HOSPITALS LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2013, and the Statement of Profit & Loss Account and Cash Flow Statement of the Company forthe yearthen ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility forthe Financial Statements

Management is responsible forthe 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 accounting principles generally accepted in India, including 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 of these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In maKing those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in orderto design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31*,March, 2013;

(b) In the case of the Statement of Profit and Loss, of 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 forthe year ended on that date. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we enclosed in the Annexure a statement on the matters specified in paragraphs 4 & 5 of the said order.

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

(a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of ouraudit;

(b) In our opinion, proper books of accounts 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 the Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of accounts;

(d) In our opinion, the attached Balance Sheet, the Statement of the Profit & Loss Account and Cash Flow Statement dealt with by this report in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act,1956;

(e) On the basis of written representation received from the Directors and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2013 from being appointed as a director in terms of section 274(1 )(g) of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS''REPORT

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory requirements" of our report of even date) i. In respect of the Company''s Fixed Assets:

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

b. All fixed assets have been physically verified by the management in accordance with phased programme of verification adopted by the Company. In our opinion the frequency of verification is reasonable. To the best of our knowledge, no material discrepancies have been noticed on such verification.

c. The Company has not disposed off its any substantial fixed assets during the year.

d. Based on our scrutiny of records of the Company and the information and explanations received by us, we report there was no sale of assets made during the financial year. Hence the question of reporting whether the sale of any substantial part of the fixed assets has affected the going concern of the Company does not arise.

ii. In respect of the Company''s Inventories:

a. Inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments have been physically verified during the period by the management. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to explanations given to us, the procedures of physical verification of inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. In our opinion and according to information and explanations given to us, and on the basis of our examination, the company is maintaining proper records of inventories. Further in our opinion and information and explanations given to us the discrepancies noticed on verification between the physical stock and the book records were not material and same have been properly dealt within the books of accounts.

iii. In respect of the loans, secured or unsecured, granted or taken by the Company to/ from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

a. As informed, the Company has not granted any loans secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the provisions of sub-clauses (a) to (d) of clause 4(iii) of CARO are not applicable to the Company.

b. The Company has taken unsecured loans amounting to Rs. 549.47 Lacs from 7 parties, covered in the register maintained under section 301 of the Companies Act, 1956.

c. In our opinion, the rate of interest and other terms and conditions on which loan has been taken from 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.

d. Such Loan is not due for repayment.

iv. In our opinion and according to the information and explanations given to us there are adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of stores, medicines and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in internal control system of the Company.

v. In respect of contracts or arrangements entered in the register maintained pursuance of Section 301 of the Companies Act,1956, to the best of our knowledge and belief and according to information and explanation given to us:

a. The particulars of contracts or arrangements referred to in Section 301 that were needed to be entered in the Register maintained under the section have been so entered.

b. In our opinion and according to the information and explanation given to us, the transactions made in pursuance of such contracts or arrangements entered in the Register maintained under section 301 of the Companies Act, 1956, exceeding the value of Rupees Five lacs in respect of any party during the period have been made at prices, which are reasonable having, to regard to prevailing market prices at relevant time.

vi. The Company has not accepted any deposits from the public. Hence, the provisions of Section 58A and 58AA of the Companies Act, 1956, and the Companies (Acceptance of Deposits) Rules, 1975, do not apply to this Company.

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

viii. According to information and explanation provided by the management of the Company, is not engaged in production, processing, manufacturing or mining activities. Hence the provisions of clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, do not apply to the Company. Hence in our opinion no comment on maintenance of cost records under section 209(1 )(d) is required.

ix.According to information and explanation given to us and on the basis of our examination of the Books of account, the Company has been generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Income Tax, Sales Tax, Wealth Tax, Service tax, Customs duty, Cess and other material statutory dues applicable to it. There was no undisputed amounts payable by the Company in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Service Tax were in arrears as at 31 * March, 2013 for a period of more than six months from the date they became payable.

x. The Company does not have any accumulated losses as at 31" March, 2013 and not incurred cash losses during the financial year and during the immediately preceding financial period.

xi. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial Institutions or banks.

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

xiii. In our opinion the Company is not Chit Fund or a Nidhi / Mutual benefit fund / Society. Therefore the provision of clause 4 (xiii) of the order (as amended) is not applicable to Company.

xiv. In respect of dealing/trading in shares securities, debentures and other investments, in our opinion and according to information and explanation given to us, generally did not deal or trade in it. However on short term basis, surplus funds were invested in mutual funds forwhich proper records of transaction have been maintained by the company in its own name.

xv. In our opinion and according to the information and explanations given to us, terms and conditions of the guarantee given by the Company for loan taken by Associate Company from banks during the years are not prime facie prejudicial to the interest of the company.

xvi. On the basis of records examined by us and according to the information and explanations given to us, the term loans have been applied for the purpose forwhich they were raised.

xvii. According to the Cash flow statement and other records examined by us and the information and explanations given to us, on a overall basis, funds raised on short term basis have not been used during the year for long term investments.

xviii. During the period, 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 issued 11% Unsecured Fully Convertible Debentures to IFCI Venture Capital Funds Limited, during the years. The said debentures are unsecured an no charge or security is required to be created in respect of debentures issued.

xx. During the year, the Company has not raised money by Public Issue. Hence, the question of disclosure and verification of end use of such monies does not arise.

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 was noticed or reported during the year.

For Jain Dhingra & Associates

Chartered Accountants

Firm Registration No.:000987C

R.N.Dhingra

Partner

Membership No.15385


Mar 31, 2012

1. We have audited the attached Balance Sheet of REGENCY HOSPITAL LIMITED ("Company") as at March 31, 2012, the Statement of Profit & Loss Account and Cash Flow Statement of the Company for year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we enclosed in the Annexure a statement on the matters specified 4 & 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report as follows:

(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 accounts 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 the Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of accounts;

(d) In our opinion, the attached Balance Sheet, the Statement of the Profit & Loss Account and Cash Flow Statement dealt with by this report in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

(e) On the basis of written representation received from the Directors and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2012 from being appointed as a director in terms of section 274(1)(g) of the Companies Act, 1956.

(f) In our opinion, and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act,1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2012;

ii) In the case of Statement Profit & Loss Account, of the Profit of the Company for the year ended on that date;

iii) In the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT

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

i. In respect of the Company's Fixed Assets :

a. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. A Major portion of the assets has been physically verified by the management in accordance with phased programme of verification adopted by the Company. In our opinion the frequency of verification is reasonable. To the best of our knowledge, no material discrepancies have been noticed on such verification.

b. Based on our scrutiny of records of the Company and the information and explanations received by us, we report there was no major sale of assets made during the financial year. Hence the question of reporting whether the sale of any substantial part of the fixed assets has affected the going concern of the Company does not arise.

c. The Company has not disposed off its any substantial fixed assets during the year.

ii. In respect of the Company's Inventories:

a. Inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments have been physically verified during the period by the management. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to explanations given to us, the procedures of physical verification of inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. In our opinion and according to information and explanations given to us, and on the basis of our examination, the company is maintaining proper records of inventories. Further in our opinion and information and explanations given to us the discrepancies noticed on verification between the physical stock and the book records were not material and same have been properly dealt within the books of accounts.

iii. In respect of the loans, secured or unsecured, granted or taken by the Company to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

a. As informed, the Company has not granted any loans secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Therefore, the provisions of sub-clauses (a) to (d) of clause 4(iii) of CARO are not applicable to the Company.

b. The Company has taken unsecured loans amounting to Rs. 1256.49 Lacs from 8 parties, covered in the register maintained under section 301 of the Companies Act, 1956.

c. In our opinion, the rate of interest and other terms and conditions on which loan has been taken from 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.

d. Such Loan is not due for repayment.

iv. In our opinion and according to the information and explanations given to us there are adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of stores, medicines and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in internal control system of the Company.

v. In respect of contracts or arrangements entered in the register maintained pursuance of Section 301 of the Companies Act, 1956 to the best of our knowledge and belief and according to information and explanation given to us:

a. The particulars of contracts or arrangements referred to in Section 301 that were needed to be entered in the Register maintained under the section have been so entered.

b. In our opinion and according to the information and explanation given to us, the transactions made in pursuance of such contracts or arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 exceeding the value of Rupees Five lacs in respect of any party during the period have been made at prices, which are reasonable having, to regard to prevailing market prices at relevant time.

vi. The Company has not accepted any deposits from the public. Hence, the provisions of Section 58A and 58AA of the Companies Act 1956, and the Companies (Acceptance of Deposits) Rules, 1975, do not apply to this Company.

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

viii. According to information and explanation provided by the management of the Company, is not engaged in production, processing, manufacturing or mining activities. Hence the provisions of Clause (d) of sub section (1) of Section 209 of the Companies Act, 1956, do not apply to the Company. Hence in our opinion no comment on maintenance of cost records under section 209(1)(d) is required.

ix. a) According to information and explanation given to us and on the basis of our examination of the Books of account, the Company has been generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Income Tax, Sales Tax, Wealth Tax, Service tax, Customs duty, cess and other material statutory dues applicable to it. There was no undisputed amounts payable by the Company in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Service Tax were in arrears as at March 31, 2012 for a period of more than six months from the date they became payable.

b) According the information and explanation give to us, there are no dues of sales tax, income tax, service tax, wealth tax, which have not been deposited with the appropriate authority on account of any dispute except following :-

Nature of the Nature of Dues Amount Amount Statute (Rs.in Deposited Lacs) (Rs. in Lacs)

Custom Act, Custom Duty 38.45 19.23 1962



Nature of the Period to which Forum where Dispute Statute the amount is Pending Relates

Custom Act, 1990-93 Appeal filed in 1962 Allahabad High Court

x. The Company does not have any accumulated losses as at March 31, 2012 and not incurred cash losses during the financial year and during the immediately preceding financial period.

xi. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial Institutions or banks.

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

xiii. The Provisions of special statute applicable to Chit Fund or a Nidhi Mutual benefit fund/Society are not applicable to the Company

xiv. In our opinion Company is not dealer or trader in shares, securities, debentures and other investments.

xv. In our opinion and according to the information and explanations given to us, having regard to the fact that the subsidiary is wholly owned the terms and conditions of the guarantee given by the Company for loan taken by the subsidiary from a bank are not prime facie prejudicial to the interest of the Company..

xvi. On the basis of records examined by us and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

xvii. According to the Cash flow statement and other records examined by us and the information and explanations given to us, on a overall basis, funds raised on short term basis have not been used during the year for long term investments.

xviii. During the period, 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 year.

xx. During the year, the Company has not raised money by Public Issue. Hence, the question of disclosure and verification of end use of such monies does not arise.

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 was noticed or reported during the year.

FOR JAIN DHINGRA & ASSOCIATES Firm Registration No. 000987C Chartered Accountants

R. N. Dhingra Partner Membership No. 15385

Kanpur, August 14, 2012


Mar 31, 2010

1. We have audited the attached Balance Sheet of REGENCY HOSPITAL LIMITED as at March 31, 2010, the Profit & Loss Account and Cash Flow Statement for year ended on that date both annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Companys management .Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (CARO) as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together theOrder) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified 4 & 5 of the said order.

4. Further to our comments in the Annexure referred to 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 purposes of our audit;

(b) In our opinion, proper books of accounts 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 Profit & Loss Account dealt with by this report are in agreement with the books of accounts;

(d) In our opinion, the attached Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

(e) On the basis of written representation received from the Directors and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31,2010 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

(f) In our opinion, and to the best of our information and according to the explanations given to us, the said accounts read with notes appearing in Schedule of Significant Accounting Policies and Notes on Accounts 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-

i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2010; ii) in the case of Profit & Loss Account, of the Profit of the Company for the year ended on that date. Hi) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT (REFERRED TO IN OUR REPORT OF EVEN DATE TO THE MEMBERS OF REGENCY HOSPITAL LIMITED

AS AT AND FOR THE PERIOD ENDED MARCH 31, 2010)

i. In respect of its Fixed Assets :

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

b. The Company has a programme of physical verification of fixed assets by which all fixed assets are verified in phased manner over period of 2 years. In our opinion the periodicity of physical verification is reasonable having regard to the size of the Company and nature of its assets. According to information and explanations given to us no material discrepancies were noticed on such verification.

c. The Company has not disposed off any substantial fixed assets during the year. ii. In respect of its Inventories:

a. Inventories of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments have been physically verified during the period by the management. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to explanations given to us, the procedures of physical verification of inventories of medicines, stores ,spares .consumables, chemicals, lab materials and surgical instruments followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion and according to information and explanations given to us, and on the basis of our examination, the Company is maintaining proper records of inventories. Further in our opinion and information and explanations given to us the discrepancies noticed on verification between the physical stock and the book records were not material and same have been properly dealt within the books of accounts.

iii. In respect of the loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 :

a. The Company has not granted any loans to parties covered in the register maintained under section 301 of the Companies Act, 1956 and consequently we are not commenting on the related clauses.

b. The Company has taken unsecured loans amounting to Rs.315.59 Lacs from 7 parties, listed in the register maintained under section 301 of the Companies Act, 1956.

c. As per terms of the loans , no interest is being paid to unsecured loans amounting to Rs.315.59 Lacs from 7 parties, listed in the register maintained under section 301 of the Companies Act, 1956.

d. Such Loan is not due for repayment.

iv. In our opinion and according to information and explanations given to us, and having regard to the explanation that some of the items are purchased are of a special nature and suitable alternative sources do not exist for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of stores, medicines and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weaknesses in internal control system.

v. In respect of contracts or arrangements entered in the register maintained pursuance of Section 301 of the Companies Act, 1956 to the best of our knowledge and belief and according to information and explanation given to us :

a. The particulars of contracts or arrangement referred to in Section 301 that needed to be entered in the register maintained under the section have been so entered.

b. In our opinion and according to the information and explanation given to us, the transactions made in pursuance of the contract or arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 exceeding the value of rupees five lacs in respect of any party during the period have been made at prices, which are reasonable having, to regard to prevailing market prices at that time.

vi. The company has not accepted any deposits from the public. Hence, the provisions of Section 58A and 58AA of the Companies Act 1956, and the Companies (Acceptance of Deposits) Rules, 1975, do not apply to this Company.

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

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

ix. a) According to information and explanation given to us and on the basis of our examination of our records the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Income Tax, Sales Tax, Wealth Tax, Customs duty and other material statutory dues applicable to it. There was no undisputed amounts payable by the Company in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Excise Duty were in arrears as at March 31, 2010 for a period of more than six months from the date they became payable.

b) According the information and explanation give to us, there are no dues of sales tax, income tax, wealth tax, excise duty and cess which have not been deposited with the appropriate authority on account of any dispute except following :-

Nature of the Nature of Dues Amount Amount Period to which Forum where Statute (Rs.in Lacs) Depos- ited the amount Dispute is (Rs.in Lacs) Relates pending

Custom Act, Custom Duty 38.45 19.23 1990-93 Appeal filed in 1962 Allahabad High Court

x. The company has no accumulated losses as at March 31, 2010. The Company has not incurred any cash losses either during the financial year on that date or in the immediately preceding financial period.

xi. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to financial Institutions or banks.

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

xiii. The clauses (xiii) & (xiv) of the paragraph 4 of the Companies (Auditors Report) Order, 2003 are not applicable to the Company as the Company is neither engaged in the business of a Chit Fund or a Nidhi Mutual benefit fund / Society nor in trading in shares, securities, debentures and other investments.

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

xv. On the basis of records examined by us and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

xvi. According to the information and explanations given to us, and on a overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis has been used for long term investments. No long-term funds have been used to finance short-term assets.

xvii. During the period, 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.

xviii. The Company has not issued any debentures during year.

xix. During the year, the Company has not raised money by Public Issue. Hence the question of disclosure and verification of end use of such monies does not arise.

xx. 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 was noticed or reported during the year.

FOR JAIN DHINGRA & ASSOCIATES Chartered Accountants

R.N.Dhingra

Partner Membership No.15385

July 31,2010 Kanpur


Mar 31, 2009

1. We have audited the attached Balance Sheet of M/s. REGENCY HOSPITAL LIMITED as at 31 st March,2009, the Profit & Loss Account and Cash Flow Statement for period ended on that date both annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order ,2003 as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together the Order) issued by the Central Government of India in terms of sub- section (4A) of Section 227 of the Companies Act, 1956 (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified 4 & 5 of the said order.

4. Further to our comments in the Annexure referred to 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 purposes of our audit;

(b) In our opinion, proper books of accounts 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 Profit & Loss Account dealt with by this report are in agreement with the books of accounts;

(d) In our opinion , the attached Balance Sheet, the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act ,1956;

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

(f) In our opinion, and to the best of our information and according to the explanations given to us, the said accounts read with notes appearing in Schedule of Significant Accounting Policies and Notes on Accounts 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 -

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2009 ;

ii) In the case of Profit & Loss Account, of the Profit of the Company for the period ended on that date.

iii) In the case of the Cash Flow Statement, of the cash flows for the period ended on that date.

i. In respect of its Fixed Assets :

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

b. The Company has a programme of physical verification of fixed assets by which all fixed assets are verified in phased manner over period of 2 years. In our opinion the periodicity of physical verification is reasonable having regard to the size of the Company and nature of its assets. According to information and explanations given to us no material discrepancies were noticed on such verification.

c. The Company has not disposed off any substantial fixed assets during the year.

ii. In respect of its Inventories:

a. Inventories of medicines, stores .spares .consumables, chemicals ,lab materials and surgical instruments have been physically verified during the period by the management. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to explanations given to us , the procedures of physical verification of inventories of medicines, stores ,spares .consumables, chemicals ,lab materials and surgical instruments followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

c. In our opinion and according to information and explanations given to us , and on the basis of our examination ,the company is maintaining proper records of inventories. Further in our opinion and information and explanations given to us the discrepancies noticed on verification between the physical stock and the book records were not material and same have been properly dealt within the books of accounts.

iii. In respect of its Inventories :

a. The Company has not granted any loans to parties covered in the register maintained under section 301 of the Companies Act, 1956 and consequently we are not commenting on the related clauses.

b. The Company has taken unsecured loans amounting to Rs.218.93 Lacs from 4 parties, listed in the register maintained under section 301 of the Companies Act, 1956 .

c. As per terms of the loans ,no interest is being paid to unsecured loans amounting to Rs.218.93 Lacs from 4 parties .listed in the register maintained under section 301 of the Companies Act, 1956 .

d. Such Loan is not due for repayment.

iv. In our opinion and according to information and explanations given to us ,and having regard to the explanation that some of the items are purchased are of a special nature and suitable alternative sources do not exist for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of stores, medicines and fixed assets and for the sale of goods and services . During the course of our audit, we have not observed any major weaknesses in internal control system.

v. In respect of contracts or arrangements entered in the register maintained pursuance of Section 301 of the Companies Act, 1956 to the best of our knowledge and belief and according to information and explanation given to us:

a. The particulars of contracts or arrangement referred to in Section 301 that needed to be entered in the register maintained under the section have been so entered.

b. In our opinion and according to the information and explanation given to us, the transactions made in pursuance of the contract or arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 exceeding the value of rupees five lacs in respect of any party during the period have been made at prices, which are reasonable having , to regard to prevailing market prices at that time.

vi. The Company has not accepted any deposits from the public. Hence, the provisions of Section 58 A and 58 AA of the Companies Act 1956, and the Companies (Acceptance of Deposits) Rules, 1975, do not apply to this Company.

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

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

ix. a) According to information and explanation given to us and on the basis of our examination of our records the company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Income Tax, Sales Tax, Wealth Tax, Customs duty and other material statutory dues applicable to it. There was no undisputed amounts payable by the Company in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Excise Duty were in arrears as at 31st March, 2009 for a period of more than six months from the date they became payable.

b) According to the information and explanation give to us, there are no dues of sales tax, income tax, wealth tax, excise duty and cess which have not been deposited with the appropriate authority on account of any dispute except following :-

Nature of the Nature of Dues Amount Amount Statute (Rs.in Lacs) Deposited (Rs.in Lacs)

Custom Act. Custom Duty 38.45 19.23 1962

Nature of the Statute Period to which Forum where The amount Dispute is Relates pending

Custom Act. 19621990-93 Appeal filed in Allahabad High Court

x. The Company has no accumulated losses as at 31st March.2009. The Company has not incurred any cash losses either during the financial year on that date or in the immediately preceding financial period.

xi. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to Financial Institutions or Banks.

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

xiii. The clauses (xiii) & (xiv) of the paragraph 4 of the Companies (Auditors Report) Order, 2003 are not applicable to the Company as the Company is neither engaged in the business of a Chit Fund or a Nidhi Mutual benefit fund / Society nor in trading in shares, securities, debentures and other investments.

xiv. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from Banks or Financial Institutions.

xv. On the basis of records examined by us and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised.

xvi. According to the information and explanations given to us, and on a overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis has been used for long term investments. No long-term funds have been used to finance short-term assets.

xvii. During the period, 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.

xviii. The Company has not issued any debentures during year.

xix. During the year, the Company has not raised money by Public Issue. Hence the question of disclosure and verification of end use of such monies does not arise.

xx. 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 was noticed or reported during the period.

FOR JAIN DHINGRA & ASSOCIATES Chartered Accountants

R.N.Dhingra Partner Membership No.15385 Place: Kanpur Date : 25.06.2009

 
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