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Auditor Report of Shri Keshav Cements & Infra Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of Shri Keshav Cements & Infra Limited [Formerly Known as KatwaUdyog Limited] ("the company"),which comprise the Balance Sheet as at 31 March 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our

audit.and

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 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 true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

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

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

Emphasis of Matters

There are no material/ Major points to be reported.

However, the financial statements of the company have been prepared on a going concern basis.

Report on other Legal and Regulatory Requirements: As required by section 143(3) of the Act, we report that:

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

b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books (and proper returns adequate for the purposes of our audit have been received from the branches not visited by us)

c) [The reports on the accounts of the branch offices of the Company audited under Section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt by us in preparing this report]

d) 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.[and the returns received from the branches not visited by us]

e) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

f) The going concern matter described in sub-paragraph (b) under the Emphasis of Matters paragraph above, in our opinion, may not have an adverse effect on the functioning of the Company.

g) On the basis of written representations received from the directors as on 31 March, 2015, taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2015, from being appointed as a director in terms of Section 164(2) of the Act.

h) With respect to the other matters included in the Auditor's Report and to our best of our information and according to the explanations given to us :

i. Company does not have any pending litigations which would impact its financial position.

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

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT OF SHRI KESHAV CEMENTS & INFRA LIMITED (FORMERLY KNOWN AS KATWA UDYOG LTD) REFERRED TO IN PARAGRAPH 1 OF OUR

REPORT OF EVEN DATE

1) The Company has maintained proper records showing full particulars, including quantitative details and situation of its fixed assets. The fixed assets are physically verified by the management in a phased manner, over a period of three years, which in our opinion is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such verification. There was no substantial disposal of fixed assets during the year. During the year Company has purchased additional machinery and spares for Plant-I for an amount to Rs. 54,42,576/- Plant –II Rs. 72,23,026/- Modvat Credit of Plant-I Rs. 5,47,840/- And Plant-II Rs. 8,19,104/- including capitalization after deducting MODVAT of Rs. 13,66,944/- 2) Physical verification of inventory has been conducted at reasonable intervals by the management. In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business. The Company is maintaining proper records of inventory. Discrepancies noticed on physical verification as compared to book records, which were not material, have been properly dealt with in the books of accounts.

3) a) As informed, the company has not granted any loan, secured or unsecured, to companies, firms or parties covered in the register maintained under Section 189 of the Companies Act, 2013.

b) The Company has taken unsecured loan from Directors covered in the register maintained under Section 73(2) of the Companies Act, 2013. The number of parties are 5 and the yearend balance of such loan taken was Rs.13,02,19,568/- c) In our opinion, the rate of interest and other terms and conditions on which loan has been taken from companies and parties covered in the Register maintained under Section 73(2) of the Companies Act, 2013 are not, prima facie, prejudicial to the interest of the Company.

d) The company is regular in repaying the principal amount as stipulated and has been regular in the payment of interest.

4) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company & nature of its business, for the purchases of inventory and fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5) a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 73(2) of the Companies Act, 2013 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) In our opinion and according to the information & explanations given to us, the Company has not accepted deposits from public under section 73 to 76. Hence question of further compliances does not arise.

7) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business, the Company has appointed a Chartered Accountant as an Internal Auditors and regularly carried out the Internal Audit.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Sec.293 of the Companies Act, 2013 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We are, however, not required to make a detailed examination of the records with a view to determine whether they are accurate or complete.

9) a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Excise duty, cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amount payable in respect of Income Tax, Wealth Tax, Sales Tax, Service Tax, Custom duty, Excise duty and cess were in arrears as at 31.03.2015 for a period of more than six months from the date they became payable.

c) According to the information & explanation give to us, there are no dues of Income Tax, Wealth Tax, Sales Tax, Service Tax, Custom duty, Excise duty or Cess which have not been deposited on account of any dispute.

d) The amount required to be transferred to investors education and protection fund in accordance with relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund, However unpaid dividend for the year 2012-13 is showing in balance sheet for Rs.25,309/- .

10) The Company does not have any accumulated losses. It has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

11) Based on our audit procedures and as per the information & explanation given by the management, the company has not defaulted in repayment of dues to financial Institution or Banks.

12) As informed and explained to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13) Since the Company is not dealing or trading in shares, securities, debentures and other investment, clause (xiv) of the Order is not applicable.

14) The company has not given any guarantee for loans taken by others from bank or financial institutions.

15) In our opinion and according to the information and explanations given to us, the term loans were applied for the purposes for which they were raised.

16) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short term basis have been used to finance long term investments.

17) During the period covered by our audit report, the Company has not issued any debentures.

18) The company has not raised any money from public issue during the year.

19) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the management

Place: Belgaum CA.Prabhakar K. Latkan

Date: 26.05.2015 Chartered Accountant

M.No : 21730

1083,Ananthashayan Galli,

BELGAUM- 590 002


Mar 31, 2014

We have audited the accompanying financial statements of Shri Keshav Cements & Infra Limited (formerly known as Katwa Udyog Ltd) (''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. The Company has changed the name from Katwa Udyog Limited to Shri Keshav Cements and Infra Limited vide Registrar of Companies Bangalore Certificate dated: 07-11 -2007. The change in name is intimated to all the State and Central Government Departments and the change of name is confirmed. The change of name is also intimated to BSE-Mumbai the approval is still under their consideration.

Management''s Responsibility for the Financial Statements:

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

Auditor''s Responsibility:

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards required 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 misstatements 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 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:

i) In the case of the Balance Sheet, of the state of affairs of the company as at 31s'' March, 2014

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 the Cash Flow Statement, of the cash flows for the year ended on that date

Report on other Legal and Regulatory Requirements:

1. As required by the Companies(Auditor''s Report) Order, 2003 ("the Order"), as amended, 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 and the Statement of Profit and Loss dealt with by this Report are in agreement with the books of account;

d) In our opinion, the Balance Sheet and Statement of Profit and Loss 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 31st March, 2014, and 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 clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956, nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the company.

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT OF SHRI KESHAV CEMENTS & INFRA LIMITED (FORMERLY KNOWN AS KATWA UDYOG LTD) REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE:

1) The Company has maintained proper records showing full particulars, including quantitative details and situation of its fixed assets. The fixed assets are physically verified by the management in a phased manner, over a period of three years, which in our opinion is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such verification. There was no substantial disposal of fixed assets during the year. During the year Company has purchased additional machinery and spares for Plant-I for an amount to Rs. 1,45,17,974/- Plant-II Rs. 1,85,00,794/- including capitalization after deducting Modvat Credit of Rs. 13,02,476/-.

2) Physical verification of inventory has been conducted at reasonable intervals by the management. In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business. The Company is maintaining proper records of inventory. Discrepancies noticed on physical verification as compared to book records, which were not material, have been properly dealt with in the books of accounts.

3) a) As informed, the company has not granted any loan, secured or unsecured, to companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) The Company has taken unsecured loan from Directors covered in the register maintained under Section 301 of the Companies Act, 1956. The number of parties are 5 and the yearend balance of such loan taken was Rs. 11,10,46,935/-.

c) In our opinion, the rate of interest and other terms and conditions on which loan has been taken from companies and parties covered in the Register maintained under Section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

d) The company is regular in repaying the principal amount as stipulated and has been regular in the payment of interest.

4) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company & nature of its business, for the purchases of inventory and fixed assets and for sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

5) a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) In our opinion & according to the information & explanations given to us, the Company has accepted deposits, by issuing SILA and it has complied with the provisions of sec. 58A, 58AA of the Companies Act, 1956 and the Company''s (Acceptance of the Deposits) Rules, 1975 with regard to the deposit accepted. During the year the Company has refunded entire deposits with interest up to date. Hence, there are no public deposits at the year end. No adverse order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business, the Company has appointed a Chartered Accountant as an Internal Auditors and regularly carried out the Internal Audit.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Sec.209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We are, however, not required to make a detailed examination of the records with a view to determine whether they are accurate or complete.

9) a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Excise duty, cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amount payable in respect of Income Tax, Wealth Tax, Sales Tax, Service Tax, Custom duty,

Excise duty and cess were in arrears as at 31.03.2014 for a period of more than six months from the date they became payable.

c) According to the information & explanation give to us, there are no dues of Income Tax, Wealth Tax, Sales Tax, Service Tax, Custom duty, Excise duty or Cess which have not been deposited on account of any dispute.

10) The Company does not have any accumulated losses. It has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

11) Based on our audit procedures and as per the information & explanation given by the management, the company has not defaulted in repayment of dues to financial Institution or Banks.

12) As informed and explained to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13) In our opinion, the Company is not chit fund or a nidhi/mutual benefit fund/societies. Therefore, the provisions of clause 4(xiii) of the Order, are not applicable to the Company.

14) Since the Company is not dealing or trading in shares, securities, debentures and other investment, clause (xiv) of the Order is not applicable.

15) The company has not given any guarantee for loans taken by others from bank or financial institutions.

16) In our opinion and according to the information and explanations given to us, the term loans were applied for the purposes for which they were raised.

17) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short term basis have been used to finance long term investments.

18) 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.

19) During the period covered by our audit report, the Company has not issued any debentures.

20) The company has not raised any money from public issue during the year.

21) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the management.

Place: Belgaum C.A. Prabhakar K. Latkan

Dated: 30-05-2014 Chartered Accountant

M No. 200/21730

1083, Ananthashayan galli,

BELGAUM-590002.


Mar 31, 2013

Report on the Financial Statements:

We have audited the accompanying financial statements of Shri Keshav Cements & Infra Limited (formerly known as Katwa Udyog Ltd] (''the company'') which comprise the Balance Sheet as at 31st March 2013 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. The Company has changed the name from Katwa Udyog Limited tp Shri Keshav Cements and Infra Limited vide Registrar of Companies Bangalore Certificate dated: 07-11-2007. The change in name is intimated to all the State and Central Government Departments and the change of name is confirmed. The change of name is also intimated to BSE-Mumbai the approval is still under their consideration.

Management''s Responsibility for the Financial Statements:

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

Auditor''s Responsibility:

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards required 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 misstatements 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 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:

i) In the case of the Balance Sheet, of the state of affairs of the Companyas at 31st March, 2013

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 the Cash Flow Statement, of the cash flows for the year ended on that date

Report on other Legal and Regulatory Requirements:

1. As required by the Companies(Auditor''s Report) Order, 2003 ("the Order"), as amended, 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 and the Statement of Profit and Loss dealt with by this Report are in agreement with the books of account;

d) In our opinion, the Balance Sheet and Statement of Profit and Loss 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 31st March, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2013, from being appointed as a director in terms of clause (g) of sub-section (1] of section 274 of the Companies Act, 1956.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956, nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the company.

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT OF SHRI KESHAV CEMENTS & INFRA LIMITED (FORMERLY KNOWN AS KATWA UDYOG LTD) REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE:

1) The Company has maintained proper records showing full particulars, including quantitative details and situation ''of its fixed assets. The fixed assets are physically verified by the management in a phased manner, over a period of three years, which in our opinion is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such verification. There was no substantial disposal of fixed assets during the year. During the year Company has purchased additional machinery and spares for Plant-I for an amount to Rs. 45,85,504/- Plant -II Rs. 2,50,10,779/- including capitalization after deducting Modvat Credit of Rs. 20,40,154/-.

2) Physical verification of inventory has been conducted at reasonable intervals by the management. In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business. The Company is maintaining proper records of inventory. Discrepancies noticed on physical verification as compared to book records, which were not material, have been properly dealt with in the books of accounts. , '' . ¦

3) a) As informed, the company has not granted any loan, secured or unsecured, to companies, firms or parties covered in the register maintained under Section 301 of the Companies Act, 1956.

b) The Company has taken unsecured loan from Directors covered in the register maintained under Section 301 of the Companies Act, 1956. The number of parties are 5 and the yearend balance of such loan taken was Rs.9,35,37,089/-.

c) In our opinion, the rate of interest and other terms and conditions on which loan has been taken from companies and parties covered in the Register maintained under Section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company.

d) The company is regular in repaying the principal amount as stipulated and has been regular in the payment of interest.

4) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company & nature of its business, for the purchases of inventory and fixed assets and for sale of goods. During the course of our audit, we have not "observed any continuing failure to correct major weaknesses in internal control system.

5) a) According to the information and explanations given to us, we are of the opinion that th transactions that need to be. entered into the register maintained under section 301 of th* Companies Act, 1956 have been so entered.

#

b) In our opinion and according to the information and explanations given to us, the transaction: made in pursuance of contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6) In our opinion & according to the information & explanations given to us, the Company has accepted public deposits, and it has complied with the provisions of sec. 58A, 58AA of the Companies Act, 1956 and the Company''s (Acceptance of the Deposits) Rules, 1975 with regard to the deposit accepted from public. No adverse order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.

7) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business, but it needs to be strengthened.

8) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Sec.209(l)(d)" of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We are, however, not required to make a detailed examination of the records with a view to determine whether they are accurate or complete.

9) a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Excise duty, cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us, no undisputed amount payable in respect of Income Tax, Wealth Tax, Sales Tax,. Service Tax, Custom duty, Excise duty and cess were in arrears as at 31.03.2013 for a period of more than six months from the date they became payable.

c) According to the information & explanation give to us, there are no dues of Income Tax, Wealth Tax, Sales Tax, Service Tax, Custom duty, Excise duty or Cess which have not been deposited on account of any dispute.

10)The Company does not have any accumulated losses. It has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

11)Based on our audit procedures and as per the information & explanation given by the management, the company has not defaulted in repayment of dues to financial Institution or Banks. „

12)As informed and explained to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13) In our opinion, the Company is not chit fund or a nidhi/mutual benefit fund/societies. Therefore, the provisions of clause 4(xiii) of the Order, are not applicable to the Company.

14)Since the Company is not dealing or trading in shares, securities, debentures and other investment, clause (xiv) of the Order is not applicable.

15)The company has not given any guarantee for loans taken by others from bank or financial institutions.

16)In our opinion and according to the information and explanations given to us, the term loans were applied for the purposes for which they were raised.

17)According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short term basis have been used to finance long term investments.

18)The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301of the Companies Act, 1956.

19) During the period covered by our audit report, the Company has not issued any debentures.

20)The company has not raised any money from public issue during the year.

21) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the management.

Place: Belgaum C.A. Prabhakar K. Latkan

Dated: 13-05-2013 Chartered Accountant

M No. 200/21730

1083, Ananthashayan galli,

BELGAUM-590 002.


Mar 31, 2012

1. We have audited the attached Balance Sheet of SHRI. KESHAV CEMENTS AND INFRA LIMITED. BELGAUM, [formally known as Katwa Udyog Limited] as at 31st March 2012, Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. The Company has changed the name from Katwa Udyog Limited to Shri Keshav Cements and Infra Limited vide Registrar of Companies Bangalore Certificate dated: 07-11-2007. The change in name is intimated to all the State & Central Government Departments and the change of name is confirmed. The change of name is also intimated to BSE - Mumbai the approval is still under their consideration.

2. We conducted our audit in accordance with the 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 as amended by the Companies (Auditor's Report)(Amendment) Order, 2004(the 'Order'), issued by Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act; 1956, we annex hereto 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 in paragraph (3) above, we report that

i) 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

ii) 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 the books.

iii) The Balance sheet; Profit and Loss Account and cash flow statements dealt with by this report are in agreement with the books of account;

iv) 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; save the compliance with accounting standards 28 on impairment of assets.

v) On the basis of the written representation 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 of the company are disqualified as on 31st March 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;.

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with significant accounting policies and other notes thereon subject to notes No ( r) on accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

c) In the case of cash flow statement, of cash flows for the year ended on that date.

STATEMENT ON THE COMPANIES [AUDITOR'S REPORT] ORDER, 2003

ANNEXURE TO THE AUDITORS1 REPORT

Shri. Keshav Cements and Infra Limited

[formally known as Katwa Udyog Limited]

Belgaum.

Referred to in paragraph 3 of our report of even date:

In respect of Fixed Assets:

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

b. The Company has physically verified all the assets during the year in accordance with programmed of verification, which in our opinion provides for physical verification of the Fixed Assets at reasonable intervals. According to the information and explanations given to us no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanations given to us, the Company has not made any substantial disposal of assets during the year and therefore the going concern concept is not affected

d. In our opinion and according to the information and explanation given to us, during the year Company has purchased additional machinery and spares for Plant-II for an amount of Rs. 3,77,90,187/- including capitalization of electricity and Company has also spent for an amount of Rs. 1,83,867/- towards Factory Building (Plant-II).

In respect of Inventories:

ii, a. As explained to us the management during the year physically verified the inventories. In our

opinion, the frequency of 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 were reasonable and adequate in relation to the size of the company and in the nature of its business.

c. In our opinion and according to the information and explanations given to us, the company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

iii a. As informed, the company has not granted loans, secured and unsecured to Companies, Firms or Other parties, covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, sub-clause (b)(c) and (d) are not applicable.

b. The Company has taken unsecured loans from directors covered in the register maintained under section 301 of the Companies Act, 1956. The number of parties are 5 and year end balance of such loan taken was Rs. 7,73,43,608/-

c. In our opinion, the rate of interest and other terms and conditions under section 301 of the Companies Act; 1956 are prima facie, not prejudicial to the interest of the Company.

d The Company is regular in repaying the principal amount as stipulated and has been regular in the payment of interest. -

e. The Company has not given loans and advances in the nature of loans to employees.

iv. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regards to purchase of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v. a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into a register in pursuance of section 301 of the Companies Act 1956 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 or arrangement have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion and according to information and explanations given to us, the company has accepted public deposits, and it has complied with the provisions of section 58A,58AA of the Companies Act, 1956 and the Companies ( Acceptance of the Deposit) Rules, 1975 with regard to the deposit accepted from public. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other tribunal

vii. In our opinion, the company has an internal audit system commensurate with the size and nature of its business, but it needs to be strengthened

viii. It is reported by the management that the Company has appointed qualified Cost Auditor and has maintained cost records as required u.s. 209(1) (d) of the Companies Act 1956. The Cost Auditor has issued a certificate stating that the Company has complied with the requirements as required u.s. 209(1) (d) of the Companies Act 1956.

ix. According to the records of the company, Provident Fund Investors Education and Protection Fund Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise duty, Cess, Fringe Benefit Tax and other material statutory dues applicable to it have been generally regularly deposited during the year with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of above were in arrears, as at March 31,2012 for a period of more than six months form the date on which they became payable.

x. According to the information and explanations given to us, there are no dues of Income Tax, Service Tax, Wealth Tax, Sales Tax, Custom Duty, Excise Tax, and Cess Fringe Benefit Tax, which have not been deposited on account of any dispute.

xi. The company does not have accumulated losses at the end of the financial year and had not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

xii. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

xiii. Based on our examination of the records and the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiv. In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4 (xiii) of the order are not applicable to the Company.

xv. In our opinion, as per the information and explanations given to us the company has not given any guarantee for the loans taken by others.

xvi. In our opinion, the term loans have been applied for the purpose 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 an over all basis, funds raised on short term basis have prima facie, not been used during the year for a long term investment (fixed assets etc) other than temporary deployment pending application. .

xviii. According to the information and explanations given to us, the company has not made any preferential allotments of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix. According to the information and explanations given to us, during the period covered by our audit report the company has not issued any debentures.

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

xxi. According to the information and explanation given to us, no fraud on or by the company has been noticed during the course of our audit

Place : Belgaum C.A. Prabhakar K. Latkan

Date: 14/08/2012 Chartered Accountant

M.No. 200/21730 1083, Anantshayan Galli Belgaum 590 002


Mar 31, 2010

1. We have audited the attached Balance Sheet of SHRI. KESHAV CEMENTS AND INFRA LIMITED, BELGAUM, [formerly known as Katwa Udyog Limited] as at 31st March 2010, Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. The Company has changed the name from Katwa Udyog Limited to Shri Keshav Cements and Infra Limited vide Registrar of Companies Bangalore Certificate dated: 07-11 -2007. The change in name is intimated to all the State & Central Government Departments and the change of name is confirmed. The change of name is also intimated to BSE - Mumbai the approval is still under their consideration.

2. We conducted our audit in accordance with the 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(the Order), issued by Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we annex hereto 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 in paragraph (3) above, we report that:

i) 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;

ii) 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 the books.

in) The Balance sheet, Profit and Loss Account and cash flow statements dealt with by this report are in agreement with the books of account;

iv) 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; save the compliance with accounting standards 28 on impairment of assets.

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

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with significant accounting policies and other notes thereon subject to notes No v on accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

c) In the case of cash flow statement, of cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT

Shri. Keshav Cements and Infra Limited [formerly known as Katwa Udyog Limited] Belgaum.

Referred to in paragraph 3 of our report of even date:

In respect of Fixed Assets:

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

b. The Company has physically verified all the assets during the year in accordance with programme of verification, which in our opinion provides for physical verification of the Fixed Assets at reasonable intervals. According to the information and explanations given to us no material discrepancies were noticed on such verification.

c. In our opinion and according to the information and explanations given to us, the Company has not made any substantial disposal of assets during the year and therefore the going concern concept is not affected.

d. In our opinion and according to the information and explanation given to us, the Company has undertaken expansion of Plant-I. The expansion work took in the earlier years. The amount spent towards expansion has been shown as capital work in progress. During the year the expansion of Plant-I is completed and Company has purchased additional machinery and spares for an amount of Rs. 1,06,49,888/- including capitalization of electricity and others and after deducting modvat credit. The capital work in progress of Rs. 7,66,85,418/- and net amount of Rs. 1,06,49,888/- totally amounting to Rs. 8,73,35,306/- has been transferred to Plant and Machinery Plant-I. Similarly, the Company has additional machinery & spares, capitalized electricity and other and after deducting modvat credit net amount of Rs. 2,68,25,980/- has been transferred to Plant and Machinery Plant-H.

In respect of Inventories:

ii. a. As explained to us the management during the year physically verified the inventories. In our opinion, the frequency of 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 were reasonable and adequate in relation to the size of the company and in the nature of its business.

c. In our opinion and according to the information and explanations given to us, the company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

I a. As iriformed, the company has not granted loans, secured and unsecured to Companies, Firms or Other parties, covered in the register maintained under section 301 ofthe Companies Act, 1956. Accordingly, sub-clause (b)(c) and (d) are not applicable.

b. The Company has taken unsecured loans from directors covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs, 6,17,46,241/-the number of parties are 5 and year end balance of such loan taken was Rs. 5,75,88,710/-

c. In our opinion, the rate ofinterest and other terms and conditions under section 301 of the Companies Act, 1956 are prima facie, not prejudicial to the interest ofthe Company.

d. The Company is regular in repaying the principal amount as stipulated and has been regular in the payment of interest.

e. The Company has not given loans and advances in the nature of loans to employees.

iv. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size ofthe company and the nature of its business with regards to purchase of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

v. a) According to the information and explanations given to us, we are ofthe opinion that the transactions that need to be entered into a register in pursuance of section 301 ofthe Companies Act, 1956 have been so entered.

b) m our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangement have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. In our opinion and according to information and explanations given to us, the company has accepted public deposits, andithas complied with the provisions of section 58A,58AA of the Companies Act, 1956 and the Companies ( Acceptance of the Deposit) Rules, 1975 with regard to the deposit accepted from public. No order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other tribunal.

vii In our opinion, the company has an internal audit system commensurate with the size and nature of its business, but it needs to be strengthened.

viii. It is reported by the management that the Company has appointed Mr. Manish Astamker, Mumbai, Cost Auditor and has maintained cost records as required u.s, 209( 1 )(d) of the Companies Act 1956. The Cost Auditor has issued a certificate stating that the Company has complied with the requirements as required u.s. 209(1) (d) ofthe Companies Act 1956.

ix. According to the records ofthe company, Provident Fund, Investors Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise duty, Cess, Fringe Benefit Tax and other material statutory dues applicable to it have been generally regularly deposited during the year with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of above were in arrears, as at March 31,2010 for a period of more than six months form the date on which they became payable.

x. According to the information and explanations given to us, there are no dues of Income Tax, Service Tax, Wealth Tax, Sales Tax, Custom Duty, Excise Tax, and Cess Fringe Benefit Tax, which have not been deposited on account of any dispute.

xi. The company does not have accumulated losses at the end of the financial year and had not incurred cash losses during the financial year covered by our audit and me immediately preceding financial year.

xii. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

xiii. Based on our examination of the records and the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiv. In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4 (xiii) of the order are not applicable to the Company.

xv. In our opinion, as per the information and explanations given to us the company has not given any guarantee for the loans taken by others.

xvi. In our opinion, the term loans have been applied for the purpose which they were raised.

xviL According to the cash flow statement and other records examined by us and the information and explanations given to us, on an over all basis, funds raised on short term basis have prima facie, not been used during the year for a long term investment (fixed assets etc) other than temporary deployment pending application.

xviil According to the information and explanations given to us, the company has not made any preferential allotments of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix. According to the information and explanations given to us, during the period covered by our audit report the company has not issued any debentures.

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

xxi. According to the information and explanation given to us, no fraud on or by the company has been noticed during the course of our audit



Place: Belgaum C.A. Prabhakar K. Latkan

Dated: 30-04-2010 Chartered Accountant

M No. 200/21730

1083, Ananthashayan galli,

BELGAUM-590002.