Home  »  Company  »  Shree Ganesh Jew (I)  »  Quotes  »  Auditor Report
Enter the first few characters of Company and click 'Go'

Auditor Report of Shree Ganesh Jewellery House (I) Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of SHREE GANESH JEWELLERY HOUSE (I) LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the 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.

Auditor's 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 there under.

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

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

Basis for Qualified opinion

(i) Note No. 52 regarding fixed Deposits amounting to Rs. 3,031.08 Lacs pledged as security with axis bank against cash credit sanctioned was adjusted with cash credit balance in the company's book on maturity of the fixed deposits. However as per cash credit account statement furnished by the bank, fixed deposits figure was not adjusted with the cash credit account balance. Thus, cash credit balance as per bank statement showed excess by Rs. 3,031.08 lacs;

(ii) Note No. 53 regarding Cash credit balance of Dhanalaxmi bank was Rs. 1,827.27 Lacs and Rs. 91.59 Lacs reflecting less balance in Company's books. The Company had contested the excess amount claimed by the bank in the High Court of Kolkata and had received a stay order on the excess claim made by the bank;

(iii) Note No.7 regarding Cash Credit A/c (Account No: 911030049091869) balance of Rs. 98,641.67 Lacs as on March 31, 2015 in which impact of Rs. 18.20 Lacs debited by Bank on dated 31st January, 2014 and Rs. 290.27 Lacs credited by Bank on 28th August, 2014 in the CC account has not been considered. These are subject to reconciliation and consequential impact if any, presently not ascertainable;

(iv) Note No.7 includes Short-term borrowings of Rs. 44,655.46 Lacs have not been confirmed as on March 31, 2015, hence we are unable to comment the consequential impact on confirmation/ reconciliation of such balances if any,

We further report that the overall impact of the matters reported by us in the aforesaid paragraphs cannot be determined and commented.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of matter described in the Basis for Qualified Opinion paragraph, 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 31st March, 2015, and its Loss and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to the following notes :

a) Note No.33 Contingent Liability, which describes the uncertainty related to the outcome of the demand raised against the Company by Sales Tax authorities;

b) Note No. 51 and 54 in the financial statements regarding preparation of these accounts on going concern basis and is facing financial crunch with its inability to meet the financial obligations. The Company had applied for Composite Corporate Debt Restructuring with the banks to mitigate the above which was withdrawn by the banks in the consortium meeting held on 22nd January, 2015. As stated the company had again requested for reconsideration of restructuring proposal by all the lenders. These facts have been disclosed in above referred notes by the management, in view of which, the accounts have been continued to be prepared under the going concern assumption.

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.

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, except as reported in clause (iii) & (iv) of the Basis for Qualified Opinion Paragraph above;

b) Except the effects of matters referred in Basis for Qualified Opinion Paragraph above, in our opinion, proper books of account as required by law have been kept by the company so far as it appears from our examination of those books.

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

d) In our opinion, the aforesaid standalone 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) The matters described in Basis for Qualified Opinion paragraph and Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company.

f) On the basis of written representations received from the directors as on March 31, 2015, and taken on record by the Board of Directors, except two directors, none of the other directors is disqualified as on March 31, 2015 from being appointed as director under the sub-section (2) of Section 164 of the Companies Act.

g) The qualification relating to the maintenance of accounts and other matters connected therewith, are as stated in the Basis for Qualified Opinion Paragraph and Emphasis of Matters paragraph above.

h) 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.33(i)& (ii)]

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 the Auditors' Report

(Referred to in Paragraph 1 of "Other Legal and Regulatory requirements" of our Audit Report)

i) In respect of Fixed Assets:

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

b) The Company has a regular program of physical verification of fixed assets by which fixed assets are verified in a phased manner over a period of three years. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the company and the nature of its assets.

ii) In respect of Inventories:

a) The inventories have been physically verified by the management as at year end. In our opinion, the frequency of such verification is reasonable.

b) In our opinion, and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion, and according to the information and explanations given to us, the Company is maintaining proper records of its inventories and no material discrepancies noticed on such physical verification.

iii) The Company has granted loans to its subsidiary companies covered in register maintained under Section 189 of the Companies Act, 2013.The maximum amount involved during the year and the year-end balance was INR. 6,763.51 Lacs and INR. 6,763.51 Lacs respectively.

a) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions on which loans have been granted to its subsidiary companies and listed in the register maintained under section 189 of the Companies Act, 2013 are not prima facie, prejudicial to the interest of the Company.

b) According to the information and explanation given to us, loans granted and interest thereon are recoverable on demand. There are no stipulations made for the recovery of the loan. Hence we cannot comment on the regularity of receipt of principal amounts and interest thereon.

c) Based on the information and explanations, there is no overdue amount outstanding at the end of the year in respect of the above said loans.

iv) There is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in internal control system during the course of the audit.

v) According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of directives issued by the Reserve Bank of India and provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under.

vi) We have broadly reviewed the cost records maintained by the Company pursuant to the Rule made by the Central Government for the maintenance of cost records under Section 148(1) of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with the 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 books of accounts,the Company is generally been deposited regularly the undisputed statutory dues including Provident Fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other statutory dues with the appropriate authorities except delay some cases and some of the amounts are still not paid as detailed below:-

Service Tax -Rs. 2.20 Lacs and

Sales Tax -Rs. 94.68 Lacs

Except West Bengal Value Added Tax aggregating of' 41.34 Lacs, there were no un-disputed statutory dues as at the end of the year concerned outstanding 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 were no dues of Wealth Tax, Custom Duty, and Cess which have not been deposited with the appropriate authorities on account of any dispute. Based on the information and explanations available, the following Sales Tax dues have not been deposited with the appropriate authorities on account of Dispute:-

Sl. Name of the Status Nature of Dues No.

1. West Bengal Sales Tax Act/ Claim of Export rejected by Appellate Central Sales Tax Act Authority on ground of non accepting Form 12A on quarterly basis but the commercial taxes authority issued it on quarterly basis.

2. West Bengal Sales Tax Act/ Export Sales and Input Tax Credit Central Sales Tax Act disallowed and Gross Turnover enhanced by 63%.

3. West Bengal Sales Tax Act/ Input tax disallowed due to Purchase Central Sales Tax Act / Sale from the same party and further,Purchase tax levied on fixed assets purchased during the year.

4. West Bengal Sales Tax Act/ Tax on sales at branch outside the Central Sales Tax Act State of West Bengal @ 12.5% and CST sales taxed @ 1% thereon.

5. West Bengal Sales Tax Act/ Disallowance of export sale and Central Sales Tax Act purchase tax on Unregistered purchase.

6 West Bengal Sales Tax Act/ Disallowance of "Form F' Central Sales Tax Act

Sl. Name of the Status Amount Period to which No. ( Rs.In Lacs) the Amount Relates

1. West Bengal Sales Tax Act/ 291.07 2006-07 Central Sales Tax Act

2. West Bengal Sales Tax Act/ 1,807.33 2007-08 Central Sales Tax Act

3. West Bengal Sales Tax Act/ 27.44 2008-09 Central Sales Tax Act

4. West Bengal Sales Tax Act/ 519.46 2009-10 Central Sales Tax Act

5. West Bengal Sales Tax Act/ 2,078.83 2010-11 Central Sales Tax Act

6 West Bengal Sales Tax Act/ 83.18 2011-12 Central Sales Tax Act

Sl. Name of the Status Forum Where the dispute is No. Pending

1. West Bengal Sales Tax Act/ Revisional Board, Sales tax Central Sales Tax Act Kolkata (South Circle)

2. West Bengal Sales Tax Act/ Appellate Authority, Sales Central Sales Tax Act Tax Kolkata (South Circle)

3. West Bengal Sales Tax Act/ Appellate Authority, Sales Central Sales Tax Act Tax Kolkata (South Circle)

4. West Bengal Sales Tax Act/ Appellate Authority, Sales Central Sales Tax Act Tax Kolkata (South Circle)

5. West Bengal Sales Tax Act/ Senior Joint Commissioner Central Sales Tax Act Kolkata (South Circle)

6 West Bengal Sales Tax Act/ Appellate Authority, Sales Central Sales Tax Act Tax, Kolkata (South Circle)



c) According to the information and explanations given to us, there is 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 during the year.

viii) The Company has no accumulated losses at the end of the financial year and has incurred cash losses amounting to Rs. 76,037.33 Lacs during current financial year. The Company had incurred cash losses in the immediately preceding financial year also.

ix) In our opinion and according to the information and explanations given to us, the Company has defaulted in repayment of dues to its banker and debenture holders. The Company has applied for reconsideration of Composite Corporate Debt Restructuring as stated by the management in Note No.51 of the financial statements.

x) In our opinion and according to the information given to us, in respect of the guarantee given by the Company for the loans taken by others from a bank, the terms and conditions thereof are not, prima facie, prejudicial to the interest of the company.

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

xii) As represented to us by the management and based on our examination of the books and records of the Company in accordance with the generally accepted auditing practices in India, we have neither come across any material fraud on or by the Company noticed or reported during the year nor we have been informed of any such case by the management that causes the financial statements to be materially misstated.

For CHATURVEDI & PARTNERS Chartered Accountants Firm Registration No.307068E

Sd/- Pratik Niyogi Date: 30th May, 2015 Partner Place: Kolkata Membership No.066514




Mar 31, 2014

1. We have audited the accompanying financial statements of Shree Ganesh Jewellery House (I)Limited, which comprise the Balance Sheet as at March 31st, 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.

2. 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. 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.

3. 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.

4. Basis for Qualified Opinion

Mismatch of cash credit figure as per company''s books and bank confirmation

(i) Fixed Deposit amounting of RS. 2,287.58 Lacs pledged as security with Axis Bank against cash credit sanctioned was adjusted with the cash credit balance in the company''s books on maturity of the Fixed Deposits. However, as per cash credit account statement furnished by the bank the Fixed Deposit figure was not adjusted with the cash credit account balance. Thus, cash credit balance as per bank confirmation showed excess by RS. 2,287.58 Lacs. Further, as per confirmation received from the bank the matured amount was not adjusted in the cash credit account but was transferred to a separate account of the bank

(ii) Cash credit balance of Dhanalaxmi Bank was shown less as per company''s books by RS. 91.59 Lacs. Cash credit balance as per Company''s books was RS. 1,485.55 Lacs and as per bank confirmation was RS. 1,577.15 Lacs. As per documents furnished to us, the company had contested the excess amount claimed by the Bank in the High Court of Kolkata and had received a stay order on the excess claim made by the bank. However, as per order passed by the court on 10th March 2014, pendency of the writ petition shall not preclude the respondents (bank)to proceed strictly in accordance with the Master Circular of Reserve Bank of India on Wilful Defaulters.

5. 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 31st, 2014;

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

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

6. Emphasis of Matter

Attenfion is drawn to note 31 in the financial statements regarding preparafion of these accounts ongoing concern basis, although company has suffered significant operafing losses during the year and is facing financial crunch with its inability to meet the financial obligations. The Company has applied for Composite Corporate Debt Restructuring with the banks to mitigate the above. These mitigating factors have fully been disclosed in above referred note, in view of which, the accounts have been continued to be prepared under the going concern assumption.

7. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India

in terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure a statement on the matters specified

in paragraphs 4 and 5 of the Order.

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

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

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

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

d. Except for the effects of 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 Companies Act, 1956;

e. On the basis of written representations received from the directors as on March 31st, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31st, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

Annexure to the Independent Auditor’s Report

(Referred to in Paragraph 4 of our report)

i. In respect of Fixed assets:

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

b. The Company has a regular program of physical verification of fixed assets by which fixed assets are verified in a phased manner over a period of three years. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the company and the nature of its assets.

c. No substantial part of the fixed assets of the company was disposed off during the year.

ii. In respect of inventories:

a. The inventories have been physically verified by the management as at year end. In our opinion, the frequency of such verification is reasonable.

b. In our opinion, and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion, and according to the information and explanations given to us, the Company is maintaining proper records of its inventories and no material discrepancies noticed on such physical verification.

iii. a. The Company has granted loans to its subsidiary companies covered in register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance was RS. 6,269.60 Lacs and RS. 6,321.83 Lacs respectively.

b. In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions on which loans have been granted to its subsidiary companies and listed in the register maintained under section 301 of the Companies Act, 1956 are not prima facie prejudicial to the interest of the Company.

c. According to the information and explanation given to us, loans granted and interest thereon are recoverable on demand. There are no stipulations made for the recovery of the loan. Hence we cannot comment on the regularity of receipt of principal amounts and interest thereon.

d. There is no overdue amount outstanding at the end of the year in respect of the above said loans.

e. The company has not taken any loan secured or unsecured from companies, firms or other parties in the register maintained under Section 301 of the Companies Act, 1956.

iv. There is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in internal control system during the course of the audit.

v. In our opinion and according to the information and explanations given to us, there were no contracts or arrangements made with the parties which required to be covered in the registers maintained under Section 301 of the companies Act, 1956.

vi. In our opinion and according to information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA or any other relevant provision of the Act and rules framed there under.

vii. In our opinion and according to information and explanations given to us, the Company has adequate overall internal control system commensurate with its size and nature of its business.

viii. We have broadly reviewed the cost records maintained by the Company pursuant to the Rule made by the Central Government for the maintenance of cost records under Section 209 (1)(d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with the view to determine whether they are accurate or complete.

ix. In respect of Statutory dues:

a. According to the information and explanations given to us and on the basis of our examination of records of the company, in our opinion, the amounts deducted/accrued in the books of accounts in respect of undisputed statutory dues including Provident fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Customs duty, Cess and other material statutory dues have generally been deposited regularly during the year by the Company with the appropriate authorities except delay in some cases and some of the amounts are still not paid as detailed below. :

Sales Tax - RS. 104.02 Lacs

Service Tax - RS. 3.36 Lacs

As explained to us, the Company did not have any dues on account of Excise duty and Investor Education and Protection fund.

b. According to information and explanations given to us, no undisputed amounts payable in respect of Employees Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom duty, Cess and other Material statutory dues were in arrears as at 31st March 2014 for a period more than 6 months from the date they become payable.

c. According to the information and explanations given to us, there were no dues of Wealth Tax, Custom Duty, and Cess which have not been deposited with the appropriate authorities on account of any dispute. Based on the information and explanations available, the following Sales Tax dues have not been deposited with the appropriate authorities on account of Dispute :-

Sl. Name of Nature of Dues NO the Status

1. West Bengal Sales Tax Claim of Export rejected by Act/Central Sales Tax Act Appellate Authority on ground of non accepting Form 12A on quarterly basis but the commercial taxes authority issued it on quarterly basis

2. West Bengal Sales Tax Export Sales and Input tax credit Act/Central Sales Tax Act disallowed and Gross Turnover enhanced by 63%. 3. West Bengal Sales Tax Input tax disallowed due to Act/Central Sales Tax Act Purchase/ Sale from the same party and further, Purchase tax levied on fixed assets purchased during the year.

4. West Bengal Sales Tax Tax on sales at branch outside the Act/Central Sales Tax Act state of West Bengal @ 12.5% and CST sales taxed @1%thereon.

5. West Bengal Sales Tax Disallowance of export sale and Act/Central Sales Tax Act purchase tax on Unregistered purchase.

Sl. Name of Amount Period to Forum where the No. the status (RS in which the Dispute is Lacks) Amount Pending Realates

1 West Bengal Sales Tax 291.07 2006-07 Revisional Act/CentralSales Tax Board, Sales Act tax Kolkata (South Circle)

2 West Bengal Sales Tax 1,807.33 2007-08 Appellate Act/Central Sales Tax Authority, Act Sales tax Kolkata (South Circle)

3 West Bengal Sales Tax 27.44 2008-09 Appellate Act/Central Sales Tax Authority, Act Sales tax Kolkata (South Circle)

4 West Bengal Sales Tax 519.46 2009-10 Appellate Act/Central Sales Tax Authority, Act Sales tax Kolkata (South Circle)

5 West Bengal Sales Tax 2,078.83 2010-11 Senior Joint Act/Central Sales Tax Commissioner Act Kolkata (South Circle)

x. The Company does not have accumulated losses at the end of the financial year 31st March, 2014 and has incurred cash losses in the current financial year.

xi. In our opinion and according to the information and explanations given to us, the Company has defaulted in repayment of dues to its banker and debenture holders. The Company has applied for Composite Corporate Debt Restructuring.

xii. In our opinion, 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. According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

xiv. In our opinion and according to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

xv. In our opinion and according to the information given to us, in respect of the guarantee given by the Company for the loans taken by others from a bank, the terms and conditions thereof are not, prima facie, prejudicial to the interest of the company.

xvi. In our opinion 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 information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that funds raised on short term basis have not been used for long term investment.

xviii. The Company has made preferential allotment in the current financial year and has allotted 1,280,000 Equity Shares of RS. 10 each which includes Security Premium of RS. 115 each to Companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956 during the year.

xix. According to the information and explanations given to us and on the basis of the records examined by us, the company has created necessary charges for the debentures issued.

xx. The Company has not raised any money by public issues during the year.

xxi. As represented to us by the management and based on our examination of the books and records of the Company in accordance with the generally accepted auditing practices in India, we have neither come across any material fraud on or by the Company noticed or reported during the year nor we have been informed of any such case by the management that causes the financial statements to be materially misstated.

For CHATURVEDI & PARTNERS Chartered Accountants Firm Registration No. 307068E

Pratik Niyogi Partner Place: Kolkata Membership No. 066514 Date: 30th May, 2014


Mar 31, 2013

1. Report on the Financial Statements

We have audited the accompanying financial statements of Shree Ganesh Jewellery House (I) Limited, which comprise the Balance Sheet as at March 31st, 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

2. 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. 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

3. 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 whetherthe 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 overal 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

4. 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 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

5. 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 ;

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

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

e. on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub- section (1) of section 274 of the Companies Act, 1956

In respect of Fixed assets:

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

b. The Company has a regular program of physical verification of fixed assets by which fixed assets are verified in a phased manner over a period of three years. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In ouropinion, this periodicity of physical verification is reasonable having regard to the size of the company and the nature of its assets.

c. No substantial part of the fixed assets of the company was disposed off during the year.

i. In respect of inventories:

a. The inventories, except for stocks lying with third parties, have been physically verified by the management as at year end. In ouropinion, the frequency of such verification is reasonable. For stock lying with third parties, confirmations have been obtained at year end.

b. In ouropinion, andaccordingtothe information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In ouropinion, andaccordingtothe information and explanations given to us, the Company is maintaining proper records of its inventories and no material discrepancies noticed on such physical verification.

iii. a. The Company hasgranted loansto its subsidiary companies covered in register maintained under Section 301 of the companies Act, 1956. The maximum amount involved duringthe year and the year-end balance wasRs. 13,229.76 Lacs and Rs. 5,781.61 Lacs respectively.

b. In ouropinion and according to the information and explanations given to us, the rate of nterest and other terms and conditions on which loans have been granted to its subsidiary companies and listed in the register maintained under section 301 of the Companies Act, 1956 are not prima facie prejudicial to the interest of the Company.

c. According to the information and explanation given to us, loans granted and interest thereon are recoverable on demand. There are no stipulations made for the recovery of the loan. Hence we cannot comment on the regularity of receipt of principal amounts and interest thereon.

d. There is no overdue amount outstanding at the end of the year in respect of the above said loans.

e. The company has not taken any loan secured or unsecured from companies, firms or other parties in the register maintained under Section 301 of the Companies Act, 1956

iv There is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in internal control system duringthe course of the audit

v. In our opinion and according to the information and explanations given to us, there were no contracts or arrangements made with the parties which required to be covered in the registers maintained under section 301 of the companies Act, 1956

vi. In our opinion and according to information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA or any other relevant provision of the Act and rules framed there under

vii. In our opinion and according to information and explanations given to us, the company has adequate overall internal control system commensurate with its size and nature of its business

viii. We have broadly reviewed the cost records maintained by the Company pursuant to the Rule made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained However, we have not made a detailed examination of the cost records with the view to determine whether they are accurate or complete

ix. In respect of Statutory dues:

a. According to the information and explanations given to us and on the basis of our examination of records of the company, in our opinion, the amounts deducted/accrued in the books of accounts in respect of undisputed statutory dues including Provident fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Customs duty, Cess and other material statutory dues have generally been deposited regularly during the year by the Company with the appropriate authorities. As explained to us, the company did not have any dues on account of Excise duty, Service tax and Investor Education and Protection fund

b. According to information and explanations given to us, no undisputed amounts payable in respect of Employees Provident Fund, Employees'' State Insurance, Income tax, Sales tax, Wealth Tax, Custom duty, Cess and other Material statutory dues were in arrears as at 31st March 2013 for a period more than 6 months from the date they become payable,

c. According to the information and explanations given to us, there were no dues of Wealth tax, Custom duty, and Cess which have not been deposited with the appropriate authorities on account of any dispute. Based on the iformation and explanations available, the following Sales Tax dues have not been deposited with the appropriate authorities on account of Dispute

SI. Name of the Nature of dues Amount

1 West Bengal Claim of export rejected Rs. 291.07 Lacs Sales Tax Act/ by Appellate Authority on Central Sales ground of non accepting Tax Act Form 12A on quarterly basis but the Commercial taxes authority issued it on quarterly basis

2 West Bengal Export Sales and Input Rs.1,807.33 Lacs Sales Tax Act/ tax credit disallowed and Central Sales Gross Turnover, enhanced Tax Act by 63 %

3 West Bengal Input tax disallowed due Rs. 27.44 Lacs Sales Tax Act/ to purchase / sale from the Central Sales same party and further, Tax Act purchase tax levied on Fixed assets purchased during the year.

4 West Bengal Tax on sales at branches Rs. 519.46 Lacs Sales Tax Act/ outside the State of West Central Sales Bengal @ 12.5% and CST Tax Act sales taxed @ 1 % thereon

Name Period to Forum where which the the dispute is amount pending relates

West Bengal 2006-07 Revisional Board, Sales Tax Kolkata (South Circle)

West Bengal 2007-08 Appellate Authority, Sales Tax Kolkata (South Circle)

West Bengal 2008-09 Appellate Authority, Sales Tax Kolkata (South Circle)

West Bengal 2009-10 Appellate Authority, Sales Tax Kolkata (South Circle)

x. The company does not have accumulated losses at the end of the financial year 31st March, 2013 and has not incurred cash losses in the current financial year and in the immediately preceding financial year

xi. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its banker and debenture holders

xii. In our opinion, 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. According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/society

xiv In our opinion and according to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments

xv In our opinion and according to the information given to us, in respect of the guarantee given by the Company for the loans taken by others from a bank, the terms and conditions thereof are not, prima facie, prejudicial to the interest of the company

xvi. In our opinion 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 information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that funds raised on short term basis have not been used for long term investment

xviii. The Company has made preferential allotment of 41,44,000 shares of Rs. 10 each at a premium of Rs.140 each, to Companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956 duringthe year

xix. According to the information and explanations given to us and on the basis of the records examined by us, the company has created necessary charges for the debentures issued

xx. The Company has not raised any money by public issues duringthe year

xxi. As represented to us by the management and based on our examination of the books and records of the Company in accordance with the generally accepted auditing practices in India, we have neither come across any material fraud on or by the Company noticed or reported duringthe year nor we have been informed of any such case by the management that causes the financial statements to be materially misstated

For Chaturvedi & Partners

Chartered Accountants

Firm Registration No.: 307068E

Pratik Niyogi

Place: Kolkata Partner

Date: 27th May 2013 Membership No.: 066514


Mar 31, 2012

1. We have audited the attached Balance Sheet of Shree Ganesh Jewellery House limited (formerly known as Shree Ganesh Jewellery House Private Limited and hereinafter referred as "the company") as at 31st March 2012, the statement of Profit and Loss and Cash Flow Statement of the company 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.

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 (CARO) issued by the Central Government 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.

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 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 and Loss and cash flow statement dealt with

by this report are in agreement with the books of account;

d) In our opinion, the Balance Sheet, statement of Profit and Loss and Cash flow statement dealt with by this report are in compliance with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

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

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 31st March, 2012; and

ii. in the case of the statement of Profit and Loss, of the Profit for the year ended on that date; and

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

Annexure to auditors' Report

(Referred to in Paragraph 3 of our report)

i. In respect of Fixed assets:

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

b. The Company has a regular program of physical verification of fixed assets by which all assets are verified annually. In our opinion, the period of verification is reasonable having regard to the size of the company and the nature of its fixed assets. No significant discrepancies were noticed on such verification.

c. No substantial part of the fixed assets of the company was disposed off during the year.

ii. In respect of inventories:

a. The inventories, except for stocks lying with third parties, have been physically verified by the management as at year end. In our opinion, the frequency of such verification is reasonable. For stock lying with third parties, confirmations have been obtained at year end.

b. In our opinion, and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. In our opinion, and according to the information and explanations given to us, the Company is maintaining proper records of its inventories and no material discrepancies noticed on such physical verification.

iii.

a. The Company has granted loans to its subsidiary companies covered in register maintained under Section 301 of the companies Act, 1956. The maximum amount involved during the year and the year-end balance was Rs 7,999.44 Lacs and Rs 7,525.36 Lacs respectively.

b. In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions on which loans have been granted to its subsidiary companies and listed in the register maintained under section 301 of the Companies Act, 1956 are not prima facie prejudicial to the interest of the Company.

c. According to the information and explanation given to us, loans granted and interest thereon recoverable on demand. There are no stipulations made for the recovery of the loan. Hence we cannot comment on the regularity of receipt of principal amounts and interest thereon.

d. There is no overdue amount outstanding at the end of the year in respect of the above said advance

e. The company has not taken any loan secured or unsecured, to or from companies, firms or other parties in the register maintained under Section 301 of the Companies Act, 1956.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchase of certain items of inventories are for the Companies specialised requirements and suitable sources are not available to obtain comparative quotations , there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in internal control system during the course of the audit

v. In our opinion and according to the information and explanations given to us, there were no contracts or arrangements made with the parties which required to be covered in the registers maintained under section 301 of the companies Act, 1956.

vi. In our opinion and according to information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA or any other relevant provision of the Act and rules framed there under.

vii. In our opinion and according to information and explanations given to us, the company has adequate overall internal control system commensurate with its size and nature of its business.

viii. The Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for any of the products manufactured/services rendered by the company. Therefore this clause is not applicable.

ix. In respect of Statutory dues:

a. According to the information and explanations given to us and on the basis of our examination of records of the company, in our opinion, the amounts deducted/accrued in the books of accounts in respect of undisputed statutory dues including Provident fund, Employee State Insurance, Income Tax, Sales Tax, Wealth Tax, Customs duty, Cess and other material statutory dues have generally been deposited regularly during the year by the Company with the appropriate authorities. As explained to us, the company did not have any dues on account of Excise duty, Service tax and Investor Education and Protection fund.

b. According to information and explanations given to us, no undisputed amounts payable in respect of Employees Provident Fund, Employees' State Insurance, Income tax, Sales tax, Wealth Tax, Custom duty, Cess and other Material statutory dues were in arrears as at 31st March 2012 for a period more than 6 months from the date they become payable,

c. According to the information and explanations given to us, there were no dues of Wealth tax, Custom duty, and Cess which have not been deposited with the appropriate authorities on account of any dispute. Based on the information and explanations available, the following Sales Tax dues have not been deposited with the appropriate authorities on account of Dispute:

Sl. Name of the Nature of dues Amount Period to which the Forum where the No. Statute (In Lacs) amount relates dispute is pending

1. West Bengal Sales Claim of export Rs 318.50 2006-07/ 2007-08 Revisional Board/ Tax Act/ Central rejected by Assessing Lacs Joint Commissioner

Sales Tax Act Authority

x. The company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its banker and debenture holders.

xii. In our opinion 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. According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/society.

xiv. In our opinion and according to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

xv. In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

xvi. In our opinion 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 information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that funds raised on short term basis have not been used for long term investment.

xviii. The Company has not made any preferential allotment of shares to Companies/firms/parties covered in the register maintained under Section 301of the Companies Act, 1956

xix. According to the information and explanations given to us and on the basis of the records examined by us, the company has created necessary charges for the debentures issued.

xx. The Company has not raised any money by public issues during the year.

xxi. 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 Chaturvedi & Partners

Chartered Accountants

Firm Registration No.: 307068E

Pratik Niyogi Place: Kolkata Partner

Date: 24th May 2012 Membership No.: 066514


Mar 31, 2011

1. We have audited the attached Balance Sheet of Shree Ganesh Jewellery House Limited (formerly known as Shree Ganesh Jewellery House Private Limited) as at 31 March 2011, the Profit and Loss Account and Cash Flow Statement of the company 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.

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 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.,

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 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 and Profit and Loss Account dealt with by this report are in agreement with the books of account; -

d) In our opinion, the Balance Sheet and Profit and Loss Account dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

e) On the basis of written representations received from the directors, as on 31 March, 2011, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 March 2011 from being appointed as a director in terms of Section 274(1)(g) of section 274 of the Companies Act, 1956 and

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 31 March 2011; and

ii. in the case of Profit and Loss Account, of the Profit/Loss for the year ended on that date; and

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

- Annexure to Auditors'- Report

Referred to in Paragraph 3 of our report of even date

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

b. The Company has a regular program of physical verification of fixed assets by which all assets are verified annually. In our opinion, the period of verification is reasonable having regard to the size of the company and the nature of its assets. No significant discrepancies were noticed on such verification.

c. :'During the year, no substantial part of the fixed assets of the Company was disposed off and hence the assumption of going concern is not affected.

ii. a. The inventories, except for stocks lying with third parties, have been physically verified by the management as at year end. In our opinion, the frequency of such verification is reasonable. For stock lying with third parties, confirmations have been obtained at year end.

b. The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c. The Company is maintaining proper records of inventories. The discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of accounts.

iii. a. The company has granted loans to 4 companies and firms covered in register maintained under Section 301 of the companies Act, 1956. The maximum amount involved during the year end balance was Rs. 2206.24 lacs and the year end balance of such loans was Rs. 661.37 lacs.

b. In our opinion, the rate of interest and other terms and conditions on which loans have been granted to companies and firms listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

c. According to the information and explanation given to us, loans and interest thereon granted to companies and firms listed in the register maintained under Section 301 of the Companies Act, 1956 are recoverable in demand. There are no stipulations made for the recovery of the loan. Accordingly, we cannot comment on the regularity of receipt of principal amounts and interest thereon.

d. There is no overdue amount of more than Rupees one lac in respect of loan granted to companies, firms or other parties listed in the register maintained under section 301. -

e. The company has not taken any loan secured or unsecured, to or from companies, firms or other parties in the register maintained under Section 301 of the Companies Act, 1956.

iv. In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchase of certain items of inventories are for the Companies specialized requirements and suitable sources are not available or obtain comparative quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of itsn business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in internal control system during the course of the audit.

v. a. In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be 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 referred to (a) above and exceeding value Rs. 5 lacs with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.However, the Company has made certain purchases of inventories which are for the Companies specialised requirements and similarly has made sale of certain goods for the specialised requirement of the buyers ,for which suitable alternative source are not available to obtain comparative quotations. However on the basis of information and explanations provided, the same appears reasonable.

vi. The Company has not accepted any deposits from public during the year.

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

viii. The Central Government has not prescribed the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for any of the products manufactured/services rendered by the company.

ix.. a. According to the information and explanations given to us and on the basis of our examination of records of the company, amounts deducted/accrued in the books of accounts in respect of undisputed statutory dues including Provident fund, Employee State

Insurance, Income Tax, Sales Tax, Wealth Tax, Customs duty, Cess and other material statutory dues have generally been deposited regularly during the year by the Company with the appropriate authorities. As explained to us, the company did not have any dues on account of Excise duty, Service tax and Investor Education and Protection fund.

There were no dues on account of cess under Section 441A of the Act, since the date from which the aforesaid Section has come into force has not yet been notified by the Central Government.

According to information and explanations given to us, no undisputed amounts payable in respect of Employees Provident Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom duty, Cess and other

Material statutory dues were in arrears as at 31 March 2011 for a period more than 6 months from the date they become payable,

b. According to the information and explanations given to us, there were no dues of Wealth Tax, Custom duty, and Cess which have not been deposited with the appropriate authorities on account of any dispute.

As explained to us, the company did not have any dues on account of Service tax and Excise duty, and Investor Education and Protection Fund.

According to information and explanation given to us, the following Sales Tax dues have not been deposited with the appropriate authorities on account of Dispute:

Nature of Nature of the dues Amount involved Period to which Forum where dispute the statute (Rs. in lacs) the amount relates is pending

West Bengal Sales Claim of esport rejected Rs. 382.25 lacs 2003-04/ Revisional Board/ Tax Act/ Central by Assessing Authority 2006-07 Joint Commissioner Sales Tax Act

x. The company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its banker and debenture holders.

xii. In our opinion 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 and according to the information - and explanations given to us the Company is not a chit fund or a nidhi/ mutual benefit fund/society.

xiv. In our opinion and according to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

xv. In our opinion and according to the information - and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

xvi. In our opinion 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 information and explanations

given to us and on an overall examination of the - Balance Sheet of the Company, we are of the opinion report that funds raised on short term basis have not been used for long term investment.

xviii. The Company has not made any preferential allotment of shares to Companies/firms/parties covered in the register maintained under Section 301of the Companies Act, 1956

xix. According to the information and explanations given to us and on the basis of the records examined by us, the company has created necessary charges for the debentures issued.

xx. The Company had made an invitation to the public to subscribe to the shares of the company with initial public offering in March 2010. The allotment of shares has been completed in the year under audit. (Refer to note no. 22 on schedule 21 to the Financial Statements).

xxi. 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 Chaturvedi & Partners

Chartered Accountants Registration No: 307068E

Surojit Banerji

Place : Kolkata Partner

Date: 26 May 2011 Membership No.: 050912


Mar 31, 2010

1. We have audited the attached Balance Sheet of Shree Ganesh Jewellery House Limited (formerly known as Shree Ganesh Jewellery House Private Limited) as at 31 March 2010, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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, 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.

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 account as required by law have been kept by the Company so far as it appears from our examination of the books;

c) The Balance Sheet, Profit and 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, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub- section (3C) of Section 211 of the Companies Act, 1956;

e) On the basis of written representations received from directors as on 31 March 2010, and taken on record by the Board of Directors, we report that, none of the directors is disqualified as on 31 March 2010from being appointed as a Director in terms of Section 274(1)(g) of the Companies Act, 1956, and

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 the affairs of the Company as at 31 March 2010; and

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

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

b) The Company has a regular programme of physical verification of fixed assets by which all assets are verified annually. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were identified on such verification.

c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

ii) a) The inventory, except for stocks lying with third parties, has been physically verified by the management as at the year end. In our opinion, the frequency of such verification is reasonable. For stocks lying with third parties, written confirmations have been obtained at the year end.

b) The procedures for physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

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

iii) a) The Company has granted loans to 4 companies and firms covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 1,734.01 lacs and the year end balance of such loans was Rs. 563.02 lacs.

b) In our opinion, the rate of interest and other terms and conditions on which loans have been granted to companies and firms listed in the register maintained under Section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

c) According to the information and explanations given to us, loans and interest thereon granted to companies and firms listed in the register maintained under Section 301 of the Companies Act, 1956 are recoverable on demand. There are no stipulations made for the recovery of the loan. Accordingly, we cannot comment on the regularity of receipt of principal amounts and interest thereon.

d) There is no overdue amount of more than Rupees one lakh in respect of loans granted to any of the companies, firms or other parties listed in the register maintained under Section 301.

e) The Company has not taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

iv) In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchase of certain items of inventories are for the Companys specialised requirements and suitable alternative sources are not available to obtain comparative quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

v) a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be 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 and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time except for purchases of certain items of inventories which are for the Companys specialised requirements and similarly for sale of certain goods for the specialised requirements of the buyers and for which suitable alternative sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appears reasonable.

vi) The Company has not accepted any deposits from the public.

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

viii) The Central Government has not prescribed the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for any of the products manufactured/ services rendered by the Company.

ix) 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 account in respect of undisputed statutory dues including Provident Fund, Employee State Insurance, Income Tax, Sales tax, Wealth tax, Customs duty, Cess and other material statutory dues have generally been deposited regularly during the year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Excise duty, Service tax and Investor Education and Protection Fund.

There were no dues on account of cess under Section 441A of the Act, since the date from which the aforesaid Section has come into force has not yet been notified by the Central Government.

According to the information and explanations given to us, no undisputed amounts payable in respect of Employees Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth tax, Customs duty, Cess and other material statutory dues were in arrears as at 31 March 2010 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 were no dues of Wealth tax, Customs duty, and Cess which have not been deposited with the appropriate authorities on account of any dispute.

As explained to us, the Company did not have any dues on account of Service Tax and Excise Duty and Investor Education and Protection Fund.

According to the information and explanation given to us, the following Sales Tax and Income Tax dues have not been deposited with the appropriate authorities on account of dispute:

Name of the Nature of Amount Period to Forum where statute the dues Involved the amount dispute is (Rs. in lacs) relates pending

West Bengal Claim of export Rs. 383.25 lacs 2003-04/ Revisional Sales Tax sales rejected 2006-07 Board/ Act/Central by Joint Commissioner Sales Tax Assessing Act Authority

Indian Various matters Rs. 23.65 lacs 2005-06/ Commissioner Income tax of Act, 1961 arising on income 2006-07 Income Tax tax proceedings (Appeals)



x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers and debenture holders.

xii) In our opinion, 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 and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

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

xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

xviii)The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

xix) The Company had unsecured debentures outstanding during the year on which no security or charge was required to be created. There are no outstanding debentures as at the year end.

xx) The Company has made an invitation to the public to subscribe to shares of the Company with initial public offering as at the end of the year. As explained to us, the allotment of shares were completed post the year end. (Also Refer to Note no. 22 on Schedule 21 to the Financial Statements).

xxi) 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 B S R & Associates

Chartered Accountants

Registration No: 116231W

Vikram Advani Place: Gurgaon Partner

Date: 20 May 2010 Membership No: 091765

 
Subscribe now to get personal finance updates in your inbox!