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Auditor Report of TCM Ltd.

Mar 31, 2016

To the Members of TCM Limited, (CIN: L24299KL1943PLC001192) 54/555,Elenjickal, MLRWLA 21,

Muttathil Lane, Kadavanthara, Cochin - 682020

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of TCM Ltd ( “the company”) which comprise the Balance Sheet as at 31st March, 2016, Statement of Profit and Loss, 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

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

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under

We conducted our audit in accordance with the Standards on Auditing specified under Section of 143 (10) of the Act . Those Standards require that we comply with the 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 the 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. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

i. All creditors and debtors are subject to confirmation; we are unable to report upon its financial implication on the financial statements under audit.

ii. None of the underlying documents in support of the investments as per the financial statements were made available for our verification except Equity Shares in Shamrao Vithal Co-op Bank Ltd for Rs. 50,000/-. Hence we are unable to express an opinion on the valuation and existence of those investments as on 31st March 2016

iii. Point No. III to the Additional Disclosures and Explanatory Notes regarding excess land.

iv. Non confirmation of deposits asperpoint no. VII to the Additional Disclosures and Explanatory Notes.

v. Non confirmation of balances with banks as per point no. VIII to the Additional Disclosures and Explanatory Notes.

a. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2016;

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

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

Report on Other Legal and Regulatory Requirements

As required by The Companies (Auditor’s Report) Order, 2016 (“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 the paragraph 3 and 4 of the Order, to the extend applicable.

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 it appears from our examination of those books.

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

d. In our opinion, the aforesaid 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. On the basis of the written representations received from the directors as on 31st March, 2016 and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in ‘Annexure B’; and 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 some pending litigations which would impact its financial position, the details of the same are attached with the financial statements in Note No.15A, Contingent Liabilities.

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

iii. There were some amounts which were required to be transferred to the Investor Education and Protection Fund by the Company, the details are as follows,

Sl. No

Nature of Dues

Amount

Related Period

1

Unpaid Debenture and Interest on unpaid debenture

60,620/-

1992-93

2

Unpaid Matured Deposits

15,000/-

1992-93

Annexure - A to the Independent Auditors Report of TCM Limited, (CIN: L24299KL1943PLC001192) 54/555,Elenjickal, MLRWLA 21, Muttathil Lane, Kadavanthara, Cochin - 682020 referred to in Paragraph 3 of CARO, 2016

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

b. The Management informed us that all the fixed assets have been physically verified by the Management during the period and no serious discrepancies between book records and physical assets have been noticed. In our opinion, the frequency of verification is reasonable.

c. As per the explanation and verification of documents we found that the title deeds of all the immovable properties are held in the name of the Company

2. Physical verification of inventory is being made by the management on an ongoing basis. The company maintains proper records of inventory and no discrepancy were noticed during physical verification of inventory during the period under audit.

3. According to the information and explanation given to us and on the verification of books of accounts, we are of the opinion that the company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register required to be maintained under section 189 of the Companies Act, 2013.

4. In our opinion and according to the information and explanation given to us the company has neither made any investments nor given any loan, guarantee or security, which has to comply with provisions of section 185 and 186 of the Companies Act, 2013.

5. The company has not accepted any deposit from the public during the period under audit.

6. The maintenance of cost records is not applicable to the company as the Turnover is less than the limit mentioned in the Companies (Cost Records and Audit) Rules 2014.

7. According to the information given to us by the Management and on the basis of our verification of the books and accounts and other records of the company, the company is irregular in depositing undisputed statutory dues. The following expenses have been outstanding for more than 6 months as at the end of financial year 2015-2016

Sl. No

Name of the Statute/ Department

Nature of Dues

Amount

Period to which amount relates

1

Tamilnadu General Sales Tax Act

AST Payable

11,822.00

2004-05

2

Central Excise Act

Excise Duty

2,82,705.00

2004-05

3

Income Tax Department

TDS

Contractors

18,566.00

2004-05

4

Income Tax Department

Income Tax

13,633.00

2004-05

5

LIC Department

LIC

Premium of Employees

1,48,181.00

2004-05

6

Postal Department

RD Collected from Employees

4,650.00

2004-05

7

Ministry Of Corporate Affairs ( Investor Education Protection Fund)

Unpaid Debenture and interest on unpaid debenture

60,620.00

1992-93

8

Income Tax Department

TDS Payable

1,920.00

2010-11

9

Income Tax Department

TDS Payable

1,92,648.00

2011-12

10

Employees State Insurance Department

ESI collected from employees and employer’s portion

4,05,211.00

2010-11

11

Provident Fund Department

PF collected from employees and employer’s portion

15,19,611.00

2010-11

12

Gonur Panchayath — Tamilnadu

Panchayath License fee

2,28,852.00

2011-12

13

Ministry Of Corporate Affairs ( Investor Education Protection Fund)

Unpaid Matured Deposits

15,000.00

1992-93

14

Income Tax Department

Income Tax

90,37,852.00

1995-96

15

Income Tax Department

Income Tax

27,45,136.00

1996-97

8. The company has not taken any loans/issued any debentures from banks/financial institutions/debenture holders, therefore question regarding default in payment of dues to banks / financial institutions/ debenture holders does not arise.

9. The company has not raised any moneys by way of initial public offer or further public offer and term loans during the year under audit, therefore the question regarding its application does not have any relevance.

10. On the basis of our verification of books of accounts and other records, we are of the opinion that no fraud by the company or any fraud on the company by its officers or employees has been noticed or reported during the period under audit.

11. The company has not paid or provided any managerial remuneration during the period under audit, hence the provisions U/s 197 of The Companies Act, 2013 has not applicable to the Company.

12. The Company is not a Nidhi Company; hence the said clause has no relevance.

13. The company has disclosed all such related party transaction in the financial statement by way of notes in the Additional disclosures and explanatory statements in compliance with section 177 and 188 of the Companies Act 2013 and as required by applicable Accounting standard.

14. According to the information and explanation given to us and based on our examination of books and accounts, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the period under audit.

15. According to the information and explanation given to us and based on our examination of books and accounts, the company has not entered any non- cash transactions with any of the directors of the Company or persons connected with him during the period under audit.

16. The company is not required to get registered under section 45-1A of the Reserve Bank of India Act, 1934.

Annexure “B” to the Independent Auditors’ Report of TCM Limited, (CIN: L24299KL1943PLC001192) 54/555,Elenjickal, MLRWLA 21, Muttathil Lane, Kadavanthara, Cochin - 682020

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of TCM Limited, (CIN: L24299KL1943PLC001192) (“the Company”) as of 31st March, 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the guidance note on audit of internal financial controls over financial reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the guidance note on audit of internal financial controls over financial reporting (the ‘Guidance Note’) and the standards on auditing (the ‘Standards’) issued by ICAI and deemed to be prescribed under section 143 (10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the guidance note issued by the ICAI.

Ernakulam

30-05-2016

FOR VBSK & COMPANY Suresh.G

Chartered Accountants Partner (M No. 210211)

(FRN 010779S)


Mar 31, 2015

We have audited the accompanying standalone fnancial statements of TCM Ltd ( "the company") which comprise the Balance Sheet as at 31st March, 2015, Statement of Proft and Loss, Cash Flow Statement for the year then ended, and a summary of the signifcant 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 fnancial statements that give a true and fair view of the fnancial position, fnancial performance and cash fows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specifed 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal fnancial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the fnancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITORS' RESPONSIBILITY

Our responsibility is to express an opinion on these standalone fnancial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the fnancial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the fnancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal fnancial control relevant to the Company's preparation of the fnancial 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 fnancial controls system over fnancial 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 Directors, as well as evaluating the overall presentation of the fnancial statements.

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

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone fnancial 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, subject to the following

i. All creditors and debtors are subject to confrmation; we are unable to report upon its fnancial implication on the fnancial statements under audit.

ii. None of the underlying documents in support of the investments as per the fnancial statements were made available for our verif cation except Equity Shares in Shamrao Vithal Co-op Bank Ltdfor Rs. 50,000/-. Hence we are unable to express an opinion on the valuation and existence of those investments as on 31st March 2015

iii. Point No. III to the Additional Disclosures and Explanatory Notes regarding excess land.

iv. Non confrmation of depositsas perpointno.VIIto the Additional Disclosures andExplanatory Notes.

v. Non confrmation of balances with banks as per point no. VIII to the Additional Disclosures and Explanatory Notes.

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

(b) in the case of the Statement of Proft and Loss, of the loss of the Company for the year ended on that date, and

( c) in the case of Cash Flow Statement for the cash outfow and infow for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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 specifed in the paragraph 3 and 4 of the Order, to the extend applicable.

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 it appears from our examination of those books.

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

(d) In our opinion, the aforesaid standalone fnancial statements, comply with the Accounting Standards specifed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

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 some pending litigations which would impact its fnancial position, the details of the same are attached with the fnancial statements in Note No.15A, Contingent Liabilities.

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

iii. There were some amounts which were required to be transferred to the Investor Education and Protection Fund by the Company, the details are as follows,

Sl. No Nature of Dues Amount Related Period

1 Unpaid Debenture and Interest on unpaid 60,620/- 1992-93 debenture

2 Unpaid Matured Deposits 15,000/- 1992-93

Annexure referred to in Paragraph 3 of CARO,2015

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

(b) The Management informed us that all the fxed assets have been physically verifed by the Management during the period and no serious discrepancies between book records and physical assets have been noticed.

2)(a) Physical verifcation of inventory is being made by the management on an ongoing basis

(b) The procedure of physical verifcation is reasonable and adequate in relation to size and nature of the business of the company.

(c) The company maintains proper records of inventory and no discrepancy were noticed during physical verifcation of inventory during the period under audit.

3) According to information and explanation given by the management of the company, the company has not granted any loan secured or unsecured during the period under audit as per the register maintained under section 189 of The Companies Act, 2013.

4) In our opinion there exist adequate internal control commensurate with size of the company and nature of its business in regard to purchase of inventory and fxed assets and sale of goods. Further, it is informed by the Management that there is no continuing failure to correct major weakness in the internal control system.

5) The company has not accepted any deposit from the public during the period under audit.

6) The maintenance of cost records is not applicable to the company as the Turnover is less than the limit mentioned in the Companies (Cost Records and Audit) Rules 2014 .

7) According to the information given to us and on the basis of our verifcation of the books and accounts and other records of the company, the company is irregular in depositing undisputed statutory dues. The following expenses have been outstanding for more than 6 months as at the end of fnancial year 2014-2015

Name of the Statute/ Sl. No Nature of Dues Department

1 Tamilnadu General Sales Tax AST Payable Act

2 Central Excise Act Excise Duty

3 Income Tax Department TDS Contractors

4 Income Tax Department Income Tax

5 LIC Department LIC Premium of Employees

6 Postal Department RD Collected from Employees

7 Ministry Of Corporate Unpaid Debenture Affairs ( Investor Education and interest on Protection Fund) unpaid debenture

8 Income Tax Department TDS Payable

9 Income Tax Department TDS Payable

10 Employees State Insurance ESI collected from Department employees and employer's portion

11 Provident Fund Department PF collected from employees and employer's portion

12 Gonur Panchayath - Panchayath Licence Tamilnadu fee

13 Ministry Of Corporate Unpaid Matured Affairs ( Investor Education Deposits Protection Fund)

14 Income Tax Department Income Tax

15 Income Tax Department Income Tax

Sl.Name of the Statute/ Period No. to which Amount amount relates

1. Taminadu Central sales 11,822.00 2004-05 Tax Act

2. Central excise Act 2,82,705.00 2004-05

3. Income Tax Department 18,566.00 2004-05

4. Income Tax department 13,633.00 2004-05

5. LIC Department 1,48,181.00 2004-05

6. Postal Department 4,650.00 2004-05

7. Ministryof Corporate 60,620.00 1992-93 Affair(Investor Education Protection)

8. Incom Tax Department 1,920.00 2010-11

9. Income Tax Department 1,92,648.00 2011-12

10.Employee State Insurence 4,05,211.00 2010-11 Department

11.Provident Fund Department 15,19,611.00 2010-11

12.Gonur Panchayath- 2,28,852.00 2011-12 Tamilnadu

13.Ministry Of Corporae 15,000.00 1992-93 Affair(Investor Education Protection Fund)

14.Income Tax Department 90,37,852.00 1995-96

15.Income Tax Department 27,45,136.00 1996-97

8) There is erosion in the net worth of the company for a sum exceeding 50% of the paid up share capital and free reserves as at 31st March, 2015, and the company has incurred a cash loss in the immediately preceding fnancial year.

9) The company has not taken any loans/issued any debentures from banks/fnancial institutions/debenture holders, therefore question regarding default in payment of dues to banks / fnancial institutions/ debenture holders does not arise.

10) The company has not given any guarantee for loans taken by others from bank or fnancial institution during the period under audit, therefore the question of any prejudice to the members of the company does not arise.

11) The company has not taken any term loan during the period under audit.

12) According to information and explanation given to us and audit procedures performed by us, no fraud or discrepancy on or by the company has been noticed or reported during the year under audit.

Ernakulam

30-05-2015

FOR VBSK & COMPANY

Chartered Accountants

(FRN 010779S)

FOR VBSK & COMPANY

Chartered Accountants

(FRN 010779S)

Suresh.G

Partner (M No. 210211)


Mar 31, 2014

We have audited the accompanying financial statements of TCM Limited which comprise the Balance Sheet as at 31 st March, 2014 and the Statement of Profit/Loss and 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 FINANCIAL STATEMENTS

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance 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.

AUDITORS'' RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the 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 the internal control relevant to the Company''s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

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

OPINION

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

i. All creditors and debtors are subject to confirmation; we are unable to report upon its financial implication on the financial statements under audit.

ii. None of the underlying documents in support of the investments as per the financial statements were made available for our verification except Equity Shares

(a) Shamrao Vithal Co-op Bank Ltd, (b) Orient Bell Limited, (c) Imkemex India Pvt Ltd. Hence we are unable to express an opinion on the valuation and existence of those investments as on 31st March 2014

iii. Point No. 4 to the Additional Disclosures regarding excess land.

iv. Non confirmation of deposits as per point no.ll to the Additional Disclosures.

v. Non confirmation of balances with banks as per point no.I2 to the Additional Disclosures.

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

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

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

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor''s Report) Order, 2003("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

(a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 those books.

(c) The Balance Sheet and Statement of Profit/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 and Statement of Profit/Loss and Cash Flow Statement, comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act, except AS- 28 on Impairment of Assets andAS-15on

Employee Benefits.

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

Annexure referred to Audit Report.

1) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. The Management informed us that, all the fixed assets have been physically verified by the Management during the period and no serious discrepancies between book records and physical assets have been noticed. Further regarding substantial disposal of assets it is informed by the Management and on our verification it is found that no substantial disposal of assets has taken place during the period under audit which would affect the sub stratum of the company as a going concern.

2) Physical verification of inventory is being made by the management on an ongoing basis and the procedure of physical verification is reasonable and adequate in relation to size and nature of the business of the company. The company maintains proper records of inventory and no discrepancy were noticed during physical verification of inventory during the period under audit.

3) According to information and explanation given by the management of the company, the company has neither granted nor taken any loan secured or unsecured from companies, firms or other parties listed in the register maintained under section 301, except unsecured interest free loan from the Managing Director ( Rs.32,98,400/-). The outstanding balance of loan from directors as on 31-03-2014 was Rs.4,59,09,408/-

4) In our opinion, there exist adequate internal control system commensurate with size of the company and nature of its business for the purchase of inventory, fixed assets and sale of goods. Further we are of the opinion that there is no failure on the part of the company to correct any major weakness in the internal control in regard to purchase of inventory, fixed assets and sale of goods.

5) It is informed by the management that no contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in to by the company during the period under audit, as such recording the particulars thereof is not applicable

6) The company has not accepted any deposit from the public during the period under audit

7) The company has no internal audit system commensurate with the size of the company and nature of its business.

8) Though maintenance of cost accounting records is applicable to the company, yet the same is not maintained at the premise of the company. According to the information made available to us, the company has made an application to the Ministry of Corporate affairs asking for waiver of such requirement for financial years 2004-05 to 2007-2008, since the company was under BIFR net. However no such request is pending for the year 2013-2014, the year under audit.

9) According to the information given to us and on the basis of our verification

of the books and accounts and other records of the company, the company is irregular in depositing undisputed statutory dues. The following expenses have been outstanding for more than 6 months as at the end of financial year 2013- 2014.

Name of the Statute / Department Nature of Dues Amount Period to which amount relates

Tamilnadu General Sales Tax Act AST Payable 11,822.00 2004-05

Central Excise Act Excise Duty 2,82,705.00 2004-05

Income Tax Department TDS Contractors 18,566.00 2004-05

Income Tax Department Income Tax 13,633.00 2004-05

LIC Department LIC Premium of 1,48,181.66 2004-05 Employees

Postal Department RD Collected from 4,650.00 2004-05 Employees

Ministry Of Corporate Unpaid Debenture 60,620.00 1992-93 Affairs (Investor Education and interest on Protection Fund) unpaid debenture

Income Tax Department TDS Payable 1,920.00 2010-11

Income Tax Department TDS Payable 1,92,648.00 2011-12

Employees State Insurance ESI collected from 4,05,211.00 2010-11 Department employees and employer''s portion

Provident Fund Department PF collected from 15,19,611.00 2010-11 employees and employer''s portion

Gonur Panchayath — Panchayath Licence 2,28,852.00 2011-12 Tamilnadu fee

Ministry Of Corporate Unpaid Matured 15,000.00 1992-93 Affairs (Investor Education Deposits Protection Fund)

Income Tax Department Income Tax 90,37,852.00 1995-96

Income Tax Department Income Tax 27,45,136.00 1996-97

10) The Accumulated losses at the end of the financial year are more than 50% of the net worth of the company. The company has incurred cash loss during the financial year ended 31st March 2014 and in the immediately preceding financial year. There is erosion in the net worth of the company for a sum exceeding 50% of the paid up share capital and free reserves as at 31st March, 2014.

11) The company has not defaulted in payment of dues to banks / financial institutions/ debenture holders during the period under audit.

12) The company has not granted any loan/advance against security of pledge of shares, debentures and other securities.

13) The company is not a chit fund/nidhi/mutual benefit fund/society

14) The company is not dealing/ trading in shares, securities, debentures and other investments

15) The company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the year under audit.

16) The company has not taken any term loan during the period under audit.

17) It is informed by the Management that the funds raised on short-term basis have not been used for long-term investments.

18) The company has not made any preferential issue of shares during the period under audit to parties and companies covered in the register maintained under section 301 of the Act.

19) The company has not issued any debentures during the period under audit therefore the question of creation of security or charges do not arise.

20) The company has not made any public issue during the year under audit hence the question of disclosing the end-use of those funds does not arise.

21) According to information and explanation given to us and audit procedures performed by us, no fraud or discrepancy on or by the company has been noticed or reported during the year under audit.

FOR VBSK & COMPANY Chartered Accountants (FRN 010779S) Place: Ernakulam Suresh. G Date: 30.05.2014 Partner (M No. 210211)


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of TCM Limited which comprise the Balance Sheet as at 31st March, 2013 and the Statement of Profit/Loss and 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 Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance 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.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the 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 the 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 the Management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity7 with the accounting principles generally accepted in India subject to the following points,

i. All creditors and debtors are subject to confirmation; we are unable to report upon its financial implication on the financial statements under audit,

ii. None of the underlying documents in support of the investments as per the financial statements were made available for our verification except Equity Shares in Shamrao Vithal Co-op Hank Ltd for Rs. 50,000/ Hence we are unable to express an opinion on the valuation and existence of those investments as on 31st March 2013

iii. Point No. 4 to the Additional Disclosures regarding excess land.

iv. Non confirmation of deposits as per point no. 11 to the Additional Disclosures.

v. Non confirmation of, balances mth banks as per point no. 12 to the Additional Disclosures.

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

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

(a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 those books.

(c) The Balance Sheet and Statement of Profit/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 and Statement of Profit/Loss and Cash Flow Statement, comply with the Accounting Standards referred to in sub- section (3C) of section 211 of the Act, except AS-28 on Impairment of assets and AS-15 on employee Benefits.

(e) On the basiss of the written representations received from the directors as on 31st March, 2013 taken on record by Board of Directors, none of 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 Act.

1) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. The Management informed us that, all the fixed assets have been physically verified by the Management during the period and no serious discrepancies between book records and physical assets have been noticed. Further regarding substantial disposal of assets it is informed by the Management and on our verification it is found that no substantial disposal of assets has taken place during the period under audit which would affect the sub stratum of the company as a going concern.

2) Physical verification of inventory is being made by the management on an ongoing basis and the procedure of physical verification is reasonable and adequate in relation to size and nature of the business of the company. The company maintains proper records of inventory and no discrepancy were noticed during physical verification of inventory during the period under audit.

3) According to information and explanation given by the management of the company, the company has neither granted nor taken any loan secured or unsecured from companies, firms or other parties listed in the register maintained under section 301, except unsecured interest free loan from the Managing Director ( Rs.49,00,000/-) and a Director (Rs. 1,00,000/-.)

4) In our opinion, there exist adequate internal control system commensurate with size of the company and nature of its business for the purchase of inventory, fixed assets and sale of goods. Further we are of the opinion that there is no failure on the part of the company to correct any major weakness in the internal control in regard to purchase of inventory, fixed assets and sale of goods.

5) It is informed by the management that no contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in to by the company during the period under audit, as such recording the particulars thereof is not applicable

6) The company has not accepted any deposit from the public during the period under audit

7) The company has no internal audit system commensurate with the size of the company and nature of its business.

8) Though maintenance of cost accounting records is applicable to the company, yet the same is not maintained at the premise of the company. According to the information made available to us, the company has made an application to the Ministry of Corporate affairs asking for waiver of such requirement for financial years 2004-05 to 2007-2008, since the company was under BIFR net. However no such request is pending for the year 2012-2013, the year under audit.

9) According to the information given to us and on the basis of our verification of the books and accounts and other records of the company, the company is irregular in depositing undisputed statutory dues. The following expenses have been outstanding for more than 6 months as at the end of financial year 2012-2013.

10) The Accumulated losses at the end of the financial year are more than 50% of the net worth of the company. The company has incurred cash loss during the financial year ended 31st March 2013 and in the immediately preceding financial year. There is erosion in the net worth of the company for a sum exceeding 50% of the paid up share capital and free reserves as at 31st March, 2013.

11) The company has not defaulted in payment of dues to banks / financial institutions/ debenture holders during the period under audit.

12) The company has not granted any loan/advance against security of pledge of shares, debentures and other securities. .

13) The company is not a chit fund/nidhi/mutual benefit fund/society

14) The company is not dealing/ trading in shares, securities, debentures and other investments

15) The company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the year under audit.

16) The company has not taken any term loan during the period under audit.

17) It is informed by the Management that the funds raised on short-term basis have not been used for long-term investments.

18) The company has not made any preferential issue of shares during the period under audit to parties and companies covered in the register maintained under section 301 of the Act.

19) The company has not issued any debentures during the period under audit therefore the question of creation of security or charges do not arise.

20) The company has not made any public issue during the year under audit hence the question of disclosing the end-use of those funds does not arise.

21) According to information and explanation given to us and audit procedures performed by us, no fraud or discrepancy on or by the company has been noticed or reported during the year under audit.

Ernakulam

31-05-2013

FOR VBSK & COMPANY

Chartered Accountants

(FRN 010779S)

Suresh.G

Partner (M No. 210211)


Mar 31, 2012

We have audited the attached Balance sheet of TCM Limited as at 31st March 2012 and the Statement of Profit / Loss account 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 the financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis- statements. 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 provide a reasonable basis for our opinion.

As required by the Companies (Auditor's Report) Order, 2003, issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we annex here to a statement on the matters specified in paragraph 4 and 5 of the said Order.

1) Further to our comments in the Annexure referred to in the paragraph (1) above and subject to the following qualifications,

I. All creditors and debtors are subject to confirmation, we are unable to report upon its financial implication on the financial statements under audit.

ii. None of the underlying documents in support of the investments as per the financial statements were made available for our verification except Equity Shares in Shamrao Vithal Co-op Bank Ltd for Rs. 50,000/-. Hence we are unable to express an opinion on the valuation and existence of those investments as on 31" March 2012

iii. Point No. 4 to the Additional Disclosures regarding excess land.

iv. Non confirmation of deposits as per point no. 11 to the Additional Disclosures.

v. Non confirmation of balances with banks as per point no. 12 to the Additional Disclosures.

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, the Company has kept proper books of accounts as required by the law so far as appears from our examination of those books of accounts.

c) The Balance sheet and the Statement of Profit / Loss, dealt with by this report are in agreement of the books of accounts.

d) In our opinion, the Balance sheet and the Statement of Profit / Loss comply with the Accounting Standard referred to in sub-section 3C of section 211 of the Companies Act, 1956, except Accounting Standard 28 on Impairment of Assets and Accounting Standard 15 on Employee Benefits

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

1) In the case of the Balance sheet, of the state of affairs of the Company as at 31st March, 2012.

ii) In the case of Statement of Profit/ Loss, of the loss of the Company for the year ended on that date.

2) On the basis of representations received from the Directors as on 31st March 2012 and taken on record by the Board of Directors of the Company, We report that none of the Directors is disqualified from being appointed as Directors under Clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS REPORT

Annexure referred to in Paragraph

1) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. The Management informed us that, all the fixed assets have been physically verified by the Management during the period and no serious discrepancies between book records and physicai assets have been noticed. Further regarding substantial disposal of assets it is informed by the Management and on our verification it is found that no substantial disposal of assets has taken place during the period under audit which would affect the sub stratum of the company as a going concern.

2) Physical verification of inventory is being made by the management on an ongoing basis and the procedure of physical verification is reasonable and adequate in relation to size and nature of the business of the company. The company maintains proper records of inventory and no discrepancy were noticed during physical verification of inventory during the period under audit.

3) According to information and explanation given by the management of the company, the company has neither granted nor taken any loan secured or unsecured from companies, firms or other parties listed in the register maintained under section 301, except unsecured interest free loan from the Managing Director ( Rs.52,33,000/-) .

4) In our opinion, there exist adequate internal control system commensurate with size of the company and nature of its business for the purchase of inventory, fixed assets and sale of goods. Further we are of the opinion that there is no failure on the part of the company to correct any major weakness in the internal control in regard to purchase of inventory, fixed assets and sale of goods.

5) It is informed by the management that no contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in to by the company during the period under audit, as such recording the particulars thereof is not applicable '

6) The company has not accepted any deposit from the public during the period under audit

7) The company has no internal audit system commensurate with the size of the company and nature of its business. .

8) Though maintenance of cost accounting records is applicable to the company, yet the same is not maintained at the premise of the company. According to the information made available to us, the company has made an application to the Ministry of Corporate affairs asking for waiver of such requirement for financial years 2004-05 to 2007-2008, since the company was under BIFR net. However no such request is pending for the year 2011-2012, the year under audit.

9) According to the information given to us and on the basis of our verification of the books and accounts and other records of the company, the company is irregular in depositing undisputed statutory dues. The following expenses have been outstanding for more than 6 months as at the end of financial year 2011-2012.

Period to SN Name of the Statute Nature of Dues Amount amount relates.

1 Tamilnadu General AST Payable 11,821.50 2004-05 Sales Tax Act

2 Central Excise Act Excise Duty 2,82,705.00 2004-05

3 Income Tax TDS 32,199.00 2004-05

4 LIC Department LIC Premium 1,48,181.66 2004-05 of Employees

5 Postal Department RD Collected from 4,650.00 2004-05 Employees

6 Ministry Of Corporate Affairs Unpaid Debenture 60,620.00 1992-93

(Investor Education and interest on unpaid Protection Fund) debenture

7 Income Tax Department TDS Payable 1,920.00 2010-11

8 Income Tax Department TDS Payable 56,700.00 2011-12

9 Employees State ESI collected from 4,05,211.00 2010-11 Insurance Department employees and employer's portion

10 Provident Fund Department PF collected from 23,78,377.00 2010-11 employees and employer's portion

11) The Accumulated losses at the end of the financial year are more than 50% of the net worth of the company. The company has incurred cash loss during the financial year ended 31s< March 2012 and in the immediately preceding financial year. There is erosion in the net worth of the company for a sum exceeding 50% of the paid up share capital and free reserves as at 31st March, 2012.

12) The company has not defaulted in payment of dues to banks / financial institutions/ debenture holders during the period under audit.

13) The company has not granted any loan/advance against security of pledge of shares, debentures and other securities.

14) The company is not a chit fund/nidhi/mutual benefit fund/society -

15) The company is not dealing/ trading in shares, securities, debentures and other investments

16) The company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the year under audit.

17) The company has not taken any term loan during the period under audit.

18) It is informed by the Management that the funds raised on short-term basis have not been used for long-term investments.

19) The company has not made any preferential issue of shares during the period under audit to parties and companies covered in the register maintained under section 301 of the Act. .

20) The company has not issued any debentures during the period under audit therefore the question of creation of security or charges do not arise.

21) The company has not made any .public issue during the year under audit hence the question of disclosing the end-use of those funds does not arise.

22) According to information and explanation given to us and audit procedures performed by us, no fraud or discrepancy on or by the company has been noticed or reported during the year under audit.

As per Report of even date attached

for and on behalf of

VBSK & Company

Chartered Accountants

(FRN 010779S)

Kochi-25. Suresh G

31.05.2012 Partner

(M. No. 210211)


Mar 31, 2010

We have audited the attached Balance sheet of TCM LTD as at 31st March 2010 and the Profit and Loss account 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 the financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statements. 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 provide a reasonable basis for our opinion.

As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we annex here to a statement on the matters specified in paragraph 4 and 5 of the said Order.

1) Further to our comments in the Annexure referred to in the paragraph (1) above and subject to the following qualifications,

/. All creditors and debtors are subject to confirmation, we are unable to report upon its financial implication on the financial statements under audit

ii. None of the underlying documents in support of the investments as per the financial statements were made available for our verification except Equity Shares in Shamrao Vithal Co-op Bank Ltd for Rs. 50,000/-. Hence we are unable to express an opinion on the valuation and existence of those investments as on 31st March 2010

iii. Note No. 4 regarding excess land.

iv. Non confirmation of deposits as per note no. 12. to Notes on Accounts

v. Non confirmation of balances with banks as per note no.13 to Notes on Accounts

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, the Company has kept proper books of accounts as required by the law so far as appears from our examination of those books of accounts.

c) The Balance sheet and the profit and Loss account dealt with by this report are in agreement of the books of accounts.

d) In our opinion, the Balance sheet and the Profit and Loss account comply with the Accounting Standard referred to in sub-section 3C of section 211 of the Companies Act, 1956, except Accounting Standard 28 on Impairment of Assets and Accounting Standard 15 on Employee Benefits

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

i) In the case of the Balance sheet, of the state of affairs of the Company as at 31 st March, 2010.

ii) In the case of Profit and Loss account, of the loss of the Company for the year ended on that date.

2) On the basis of representations received from the Directors as on 31st March 2010 and taken on record by the Board of Directors of the Company, We report that none of the Directors is disqualified from being appointed as Directors under Clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS REPORT Annexure referred to in Paragraph 1

1) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The Management informed us that all the fixed assets have been physically verified by the Management during the period and no serious discrepancies between book records and physical assets have been noticed. Further regarding substantial disposal of assets it is informed by the Management and on our verification it is found that no substantial disposal of assets have been effected in the period under audit which would affect the sub stratum of the company as a going concern.

2) Physical verification of inventory is being made by the management on an ongoing basis and the procedure of physical verification is reasonable and adequate in relation to size and nature of the business of the company. The company maintains proper records of inventory and no discrepancy were noticed during physical verification of inventory during the period under audit.

3) According to information and explanation given by the management of the company, the company has neither granted nor taken any loan secured or unsecured from companies, firms or other parties listed in the register maintained under section 301, except unsecured interest free loan from the Managing Director ( Rs.52,00,000/-) and a director ( Rs. 12,35,000/-)

4) In our opinion there exist an adequate internal control system commensurate with size of the company and nature of its business for the purchase of inventory, fixed assets and sale of goods. Further we are of the opinion that there is no failure on the part of the company to correct any major weakness in the internal control in regard to purchase of inventory, fixed assets and sale of goods.

5) It is informed by the management that no contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in to by the company during the period under audit, as such recording the particulars thereof is not applicable

6) The company has not accepted any deposit from the public during the period under audit

7) The company has no internal audit system commensurate with the size of the company and nature of its business.

8) Though maintenance of cost accounting records is applicable to the company, yet the same is not maintained at the premise of the company. According to the information made available to us, the company has made an application to the Ministry of Corporate affairs asking for waiver of such requirement for financial years 2004-05 to 2007-2008, since the company was under BIFR net. However no such request is pending for the year 2009-2010, the year under audit.

9) (a) According to the information given to us and on the basis of our verification of the books and accounts and other records of the company, the company is regular in depositing undisputed statutory dues, except the following which has been outstanding for more than 6 months as at the end of financial year 2009- 2010.

SN Name of the Statute Nature of Dues Amount Period to which

amount relates.

1 Central Sales Tax Act CST Payable 34,827,98 2004-05

2. TNGST AST Payable 11,821,50 2004-05

3. Central Excise Act Excise Duty 2,82,705.00 2004-05

4. Income Tax TDS 32,199,00 2004-05

5. LIC Department LIC Premium of 1,48,181,66 2004-05 Employee

6. Postal Department RD Collected 4,650,00 2004-05

from Employees

7 Ministry of Corpo rate affairs Unpaid Deben ture 60,620,00 1992-93

(Investor Education and interest on

Protection Fund) unpaid debe nture

(b) The Income Tax demand for Rs.27.85 lakhs for the year 1997-98 being under dispute unpaid and is pending before the Income Tax Appellate Tribunal.

10) The Accumulated losses at the end of the financial year are more than 50% of the net worth of the company. The company has incurred cash loss during the financial year ended 31 st March 2010 and in the immediately preceding financial year. There is erosion in the net worth of the company for a sum exceeding 50% of the paid up share capital and free reserves as at 31st March, 2010.

11) The company has not defaulted in payment of dues to banks / financial institutions/ debenture holders during the period under audit.

12) The company has not granted any loan/advance against security of pledge of shares, debentures and other securities.

13) The company is not a chit fund/nidhi/mutual benefit fund/society

14) The company is not dealing/ trading in shares, securities, debentures and other investments

15) The company has not given any guarantee for loans taken by others from Banks or Financial Institutions during the year under audit.

16) The company has taken an interest tree secured term loan from Goderaj Properties Ltd (Rs.2, 50, 00,000) during the period under audit, the balance of the same as on 31-03-2010 was Rs.19,67,52,846.00 ( Previous Year Balance Rs. 17,17,52,846.00) and the same has been utilized for the purpose for which it is taken.

17) It is informed by the Management that the funds raised on short-term basis have not been used for long-term investments.

18) The company has not made any preferential issue of shares during the period under audit to parties and companies covered in the register maintained under section 301 of the Act.

19) The company has not issued any debentures during the period under audit therefore the question of creation of security or charges do not arise.

20) The company has not made any public issue during the year under audit hence the question of disclosing the end-use of those funds does not arise.

21) According to information and explanation given to us and audit procedures performed by us, no fraud or discrepancy on or by the company has been noticed or reported during the year under audit.

As per Report of even date attached for and on behalf of VBSK & Company Chartered Accountants (FRN 010779S)

Ernakulam Suresh G

30th June 2010 Partner

(M. No. 210211)

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