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Auditor Report of Tulip Star Hotels Ltd.

Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Tulip Star Hotels Limited (the “Company”), which comprise the Balance Sheet as at March 31, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Ind AS 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 Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (“Ind AS”) prescribed under section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS 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 Ind AS financial statements based on our audit.

In conducting 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 of the standalone Ind AS financial statements 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 standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS 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 standalone Ind AS 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 standalone Ind AS financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Emphasis of matter:

Attention is invited to note number 18,note number 19 and note number 20 ofnotes forming part of accounts regarding the quality of the Company’s investment in an investee company as well as recoverability of its interestf-ee loan in the said company. The Management is of the opinion that notwithstanding the ongoing financial and legal issues of the investee company, taking into account the present value of the investee company’s hotel property vis-a-vis its aggregate liabilities, there is no permanent diminution in the book value of the Company’s investments nor is there a threat to recovery of interest free loan in the investee company in the long run. Our opinion on the financial statements is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) of the Act, based on our audit 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, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Act.

f) According to the information and explanation given to us, the Company has not established its internal financial control over financial reporting on criteria based on or considering the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over financial reporting issued by the Institute of Chartered Accountants of India. Consequently, we are unable to obtain sufficient appropriate audit evidence to provide basis for our opinion whether the Company had adequate internal financial controls over financial reporting and whether such internal financial controls were operating effectively as at March 31st, 2018.

We have considered the disclaimer reported above in determining the nature, timing, and extent of audit tests applied in our audit of the financial statements of the Company, and the disclaimer does not affect our opinion on the financial statements of the Company.

g) 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, as amended, in our opinion and to the best of our information and according to the explanations given to us:

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements — Refer note number 21 of notes forming part of accounts;

ii. The Company did not have any long term contracts including derivative contracts that require provision under any law or accounting standards for which there were any material foreseeable losses.

iii. There was no amount to be transferred to the Investor Education and Protection Fund by the Company.

2. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

ANNEXURE TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 2 under the heading of “Report on Other Legal and Regulatory Requiremens” of our report of even date)

The Annexure referred to in our Independent Auditor’s Report to the members of the Company on the financial statements for the year ended 31 March 2018, we report that:

i. The Company does not have any Fixed Assets.

ii. The Company is a service company, primarily rendering hotel mangement services. Accordingly, it does not hold any physical inventories. Thus, paragraph 3(ii) of the Order is not applicable.

iii. The following are the particulars of unsecured loans granted by the Company to companies firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013 (‘the Act’).

Details of loans granted:

Sr.No.

Name of the Party

Relationship

Amount (Rs. )

Year-End Balance (Rs. )

1.

V Hotels Ltd

Common Directors

Nil

37,00,00,000

The above loans are interest free as such these loans are prejudicial to the interest of the Company.

We are informed that the terms of arrangements do not stipulate any repayment schedule. Accordingly, paragraph 3 (iii) (b) & 3 (iii) (c) of the Order is not applicable to the Company in respect of repayment of the principal amount.

iv. In our opinion and according to the information and explanations given to us, the company has not complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made to the following parties:

Sr.No.

Name of the Party

Amount (Rs. )

1.

Non compliance with the provisions of section 185 and 186 of the Act

V Hotels Ltd

37,00,00,000

2.

Non compliance with the provisions of section 186 of the Act

Banzai Estates Private Limited

1,15,00,000

v. The Company has not accepted any deposits from the public.

vi. The Central Government has not prescribed the maintenance of cost records under section 148 (1) of the Act, for any of the services rendered by the Company.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund and employees’ state insurance and other material statutory dues (barring tax deducted at source and service tax) have been regularly deposited during the year by the Company with the appropriate authorities.

As explained to us, the Company did not have any dues on account of sales tax, wealth tax, duty of customs, value added tax, cess and duty of excise.

According to the information and explanations given to us, the following undisputed amounts payable in respect of income tax and service tax were in arrears as at 31 March 2016 for a period of more than six months from the date they became payable.

Fringe Benefit Tax Rs. 4.75 Lacs

Service Tax Rs. 13.63 Lacs

Tax Deducted at Source Rs. 140.92 Lacs

(b) According to the information and explanations given to us, the following dues of income tax, have not been deposited by the Company on account of disputes:

Nature of Disputed Dues

Amount (Rs. ) In Lacs

Forum where dispute is pending

Penalty U/s 221(1) of the Income Tax Act, 1961 for assessment year 2007-08

40.34

Hon’ble Income Tax Tribunal, New Delhi

viii. The Company did not have any outstanding dues to financial institutions, banks or Debenture holders during the year.

ix. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly paragraph 3 (ix) of the order is not applicable.

x. According to the information and explanation given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

xi. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not paid/provided for any managerial remuneration.

xii. In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3 (xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India.

For K A M G & Associates

Chartered Accountants

Firm Reg. No. 311027E

Arpit Shah

Partner

Place: Mumbai Membership No. 180949

Date: May 29, 2018


Mar 31, 2015

We have audited the accompanying financial statements of Tulip Star Hotels Limited ('the Company'), which comprise the balance sheet as at 31 March 2015, the statement of Profit and loss and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

Te 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 and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of afairs of the Company as at 31 March 2015 and its loss and its cash fows for the year ended on that date.

Emphasis of matter:

Attention is invited to note number 19, note number 20 and note number 21 of notes forming part of accounts regarding the quality of the Company's investment in an investee company as well as recoverability of its interest free loan in the said company. t Te Management is of the opinion that notwithstanding the ongoing financial and legal issues of the investee company, taking into account the present value of the investee company's hotel property vis-à-vis its aggregate liabilities, there is no permanent diminution in the book value of the Company's investments nor is there a threat to recovery of interest free loan in the investee company in the long run. Our opinion on the financial statements is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143 (3) of the Act, we report that:

(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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, the statement of Profit and loss and the cash fow statement dealt with by this Report are in agreement with the books of account;

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

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

(f) with respect to the other matters to be includes in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. the Company has disclosed the impact of pending litigations on its financial position in its financial statements – Refer note number 22 of notes forming part of accounts;

ii. Te Company did not have any long term contracts including derivative contracts that require provision under any law or accounting standards for which there were any material foreseeable losses.

iii. There was delay of 50 days in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT

Te Annexure referred to in our Independent Auditor's Report to the members of the Company on the financial statements for the year ended 31 March 2015, we report that:

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

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

ii. Te Company is a service company, primarily rendering hotel management services Accordingly, it does not hold any physical inventories. Thus, paragraph 3(ii) of the Order is not applicable.

iii. Te following are the particulars of unsecured loans granted by the Company to companies firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013 ('the Act').

no. Party Relationship Amount year-End Balance

1 V Hotels Ltd Common Directors Nil 37,00,00,000

Te above loan is interest free and we are informed that the company has not yet raised any demand for repayment of this loan. Accordingly, paragraphs 3 (iii) (a) and 3 (iii) (b) of the Order are not applicable to the Company in respect of repayment of the principal amount.

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

v. Te Company has not accepted any deposits from the public.

vi. Te Central Government has not prescribed the maintenance of cost records under section 148 (1) of the Act, for any of the services rendered by the Company.

(a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund and employees' state insurance and other material statutory dues (barring tax deducted at source and service tax) have been regularly deposited during the year by the Company with the appropriate authorities.

As explained to us, the Company did not have any dues on account of sales tax, wealth tax, duty of customs, value added tax, cess and duty of excise.

According to the information and explanations given to us, the following undisputed amounts payable in respect of income tax and service tax were in arrears as at 31 March 2015 for a period of more than six months from the date they became payable.

Fringe benefit tax 2.75 Lacs

Service tax 9.15 Lacs

tax Deducted at Source 53.57 Lacs

(b) According to the information and explanations given to us, the following dues of income tax, have not been deposited by the Company on account of disputes:

Nature of Disputed Dues Amount Rs. in Lacs Forum where dispute is pending

Income tax on completion of regular as- 149.70 hon'ble income tax tribunal, New sessments for assessment year 2007-08 Delhi

Penalty U/s 221(1) of the income tax 40.34 hon'ble income tax tribunal, New

Act, 1961 for assessment year 2007-08 Delhi

(c) According to the information and explanations given to us the amounts which were required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 ( 1 of 1956) and rules there under has been transferred to such fund however with the delay of 50 days.

vii. The Company does have accumulated losses at the end of the financial year and has incurred cash losses in the financial year and in the immediately preceding financial year.

viii. Te Company did not have any outstanding dues to financial institutions, banks or Debenture holders during the year.

ix. Te Company has given the following guarantees to various banks for loans taken by V Hotels Ltd. Te details of guarantees are as follows:

Name of the Bank Amount of Guarantee given (Rs.)

consortium of banks 129,00,00,000

Plus interest canara bank 4,40,00,000

icici bank 12,40,000

According to the relevant records examined by us and on the basis of information and explanations given to us, as the terms and conditions of the guarantee given to consortium of banks amounting to Rs.129 Cr. includes a clause that reserves to the consortium of banks the right to claim from the Company all sums due to them without having to frst take recourse to the principal borrower, we are of the opinion that terms and conditions of the said guarantee are prejudicial to the interests of the Company.

x. According to the information and explanations given to us and on the basis of records examined by us no terms loans were raised during the year.

xi. According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For ray & ray Chartered Accountants Firm Reg. No. 301072E

Anil V. Karnik

Partner Place : Mumbai Membership No. 31005

Date : May 14, 2015


Mar 31, 2014

We have audited the accompanying financial statements of Tulip Star Hotels Ltd. ("the Company") which comprises the Balance Sheet as at March 31, 2014, the Statement of Profit and Loss and 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

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India including Accounting Standards referred in Section 211(3C) of the Companies Act, 1956 ("the Act"). This responsibility includes 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 ethical requirements and plan and perform our audit to obtain reasonable assurance about whether the financial statements are free of material misstatements.

An audit involves performing procedure to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

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

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

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

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

Emphasis of matter:

Attention is invited to note number 20 and note number 21 of notes forming part of accounts regarding the quality of the Company''s investment in an investee company as well as recoverability of its interest free loan in the said company. The Management is of the opinion that notwithstanding the ongoing financial and legal issues of the investee company, taking into account the present value of the investee company''s hotel property vis-a-vis its aggregate liabilities, there is no permanent diminution in the book value of the Company''s investments nor is there a threat to recovery of interest free loan in the investee company in the long run. Our opinion on the financial statements is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

2. As required by Section 227 (4A) of the Act, 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 those books; iii) the Balance Sheet, Statement of Profit and Loss and die Cash Flow Statement dealt with by this report are in agreement with the books of account; iv) in our opinion the Balance Sheet, Statement of Profit & Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in section 211 (3C) of the Act;

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

ANNEXURE TO THE AUDITORS'' REPORT

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

1. The Company has maintained proper records to show full particulars including quantitative details and situation of its fixed assets.

2. The fixed asset of the Company has been physically verified by the management during the year.

3. During the year, the Company has not disposed off any of its fixed assets.

4. The Company did not hold any inventories during the year.

5. The following are the particulars of unsecured loans taken / granted by the Company from / to companies firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

Details of loans taken:

No. Party Relationship Amount rs Year-End Balance rs

1 Cox & Kings Ltd Common Directors Nil 22,31,00,000

2 Tulip Hotels Pvt Ltd Common Directors Nil 13,84,00,000

Interest at 15% p.a. is charged by Cox & Kings Ltd, which rate in our opinion is not prejudicial to the interest of the Company.

We are given to understand that loan from Tulip Hotels Pvt. Ltd. is interest free, which is not prejudicial to the interest of the Company.

We are given to understand by the Company''s management that loan from Cox & Kings Ltd. is repayable on demand, which in our opinion is prima facie prejudicial to the interest of the Company.

According to the information and explanations given to us, loan from Cox & Kings Ltd. is repayable on demand and others are to be repaid at the end of tenure. Accordingly the question of regularity in repayment of principal does not arise.

Details of loans granted:

No. Party Relationship Amount Rs. Year-End Balance Rs.

1 V Hotels Ltd. Common Directors - 37,00,00,000

As the above loan is interest free, we are of the opinion that terms and conditions with respect to interest in case of loans granted are prima facie prejudicial to the interest of the Company.

There are no stipulations as regards repayments of these loans. Consequently, we are unable to comment on the regularity or otherwise of repayment of principal.

In view of the above comment, the question of overdues does not arise. There is no evidence to indicate steps taken by the Company for recovery.

6. In our opinion and according to the information and explanations given to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories, fixed assets and with regard to the sale of goods / services.

Further, during the course of our audit, we have neither come across nor have we been informed of any instances indicative of major weaknesses in the aforesaid internal control procedures, which would require corrective action.

7. On the basis of our examination of the books of account and according to the information and explanations provided by the management 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.

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

9. The Company has not accepted any deposits from the public during the year under sections 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. Further, during the course of our audit, we have neither come across nor have we been informed of any order passed under the aforesaid sections by the National Company Law Tribunal during the year.

10. The Company does not have an internal audit system.

11. In our opinion, clause VIII of paragraph 4 of the aforesaid Order pertaining to maintenance of cost records under section 209 (l)(d) of the Companies Act, 1956 is not applicable to the Company.

12. According to the books and records as produced before us and examined by us in accordance with generally accepted auditing practices in India and the managements representation, we are of the opinion that the Company is regular in depositing, barring investor protection fund, with appropriate authorities undisputed statutory dues including Provident Fund, Employees'' State Insurance, except for Tax Deducted at source Income Tax. Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess are not applicable to the Company.

The following unpaid statutory dues have remained outstanding as on 31.3.2014 for a period exceeding six months from the date they became payable.

Fringe Benefit Tax rs 2.75 Lacs

Provident Fund rs 1.43 Lacs

Service Tax rs 4.93 Lacs

Tax Deducted at Source rs 51.26 Lacs

13. According to the records of the Company there are no dues of Sales Tax, Income Tax, Service Tax, Customs Duty, Wealth Tax, Excise Duty / Cess which have not been deposited on account of any dispute Except the following:

Nature of Disputed Dues Amount rs In Lacs Forum where dispute is pending

Income Tax on 149.70 Hon''ble Income Tax Tribunal, completion of regular New Delhi asscessments for assessment year 2007-08

Penalty U/s 221(1) of the 40.34 Hon''ble Income Tax Tribunal, income tax act 1961 New Delhi

14. The Company does not have accumulated losses as at the end of the year and the Company has incurred cash losses during the year and in the immediately preceding financial year.

15. The Company does not owe any dues to Banks/Financial Institutions and hence the clause (xi) of paragraph 4 of the aforesaid order is not applicable to the Company.

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

17. We are given to understand that the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable to the Company.

18. According to the information and explanation given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other securities. We also report that the Company has held the Shares, Securities, Debentures and Other Securities in its own name.

19. The Company has given the following guarantees to various banks for loans taken by V Hotels Ltd. The details of guarantees are as follows:

Name of the Bank Amount of Guarantee given (Rs.)

Consortium of Banks 129,00,00,000 Plus interest

Canara Bank 4,40,00,000

ICI CI Bank 12,40,000

According to the relevant records examined by us and on die basis of information and explanations given to us, as the terms and conditions of the guarantee given to consortium of banks amounting to Rs. 129 Cr. includes a clause that reserves to the consortium of banks the right to claim from the Company all sums due to them without having to first take recourse to the principal borrower, we are of the opinion that terms and conditions of the said guarantee are prejudicial to the interests of the Company.

20. According to the information and explanations given to us and on the basis of records examined by us no terms loans were raised during the year.

21. On the basis of review of utilization of funds on overall basis, the related information made available to us and as represented to us by the management, we are of the opinion that no funds raised on short term basis have been used for long term investments.

22. In our opinion and according to information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year.

23. Since the Company has not issued any debentures during the year, the question of creation of any security or charge does not arise.

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

25. During the course of our examination of books of account carried out in accordance with generally accepted auditing practices we have neither come across any instance of fraud on or by the management nor have we been informed of such case by the management.

For Ray & Ray Chartered Accountants Firm Reg. No. 301072E

AnilV. Karnlk Partner Place : Mumbai Membership No. 31005 Date : May 29, 2014


Mar 31, 2013

Report on Financial Statements

We have audited the accompanying f nancial statements of Tulip Star Hotels Ltd. ("the Company") which comprises the Balance Sheet as at March 31, 2013, the Statement of Prof t and Loss and the Cash Flow Statement for the year then ended and a summary of signif cant accounting policies and other explanatory information

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these f nancial statements that give a true and fair view of the f nancial position, f nancial performance and cash f ows of the Company in accordance with the accounting principles generally accepted in India including Accounting Standards referred in Section 211(3C) of the Companies Act, 1956 ("the Act"). T is responsibility includes design, implementation and maintenance of internal control relevant to the preparation and presentation of the f nancial 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 f nancial 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. T ose standards require that we comply with ethical requirements and plan and perform our audit to obtain reasonable assurance about whether the f nancial statements are free of material misstatements.

An audit involves performing procedure to obtain audiThevidence about the amounts and disclosures in the f nancial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the f nancial 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 f nancial 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 f nancial statements.

We believe that audiThevidences we have obtained is suf cient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us the aforesaid f nancial statements give the information required by 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 af airs of the Company as at March 31, 2013;

b) in the case of Statement of Prof t & Loss, of the loss for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

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

2. As required by Section 227 (4A) of the Act, 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 those books;

iii) the Balance Sheet, Statement of Prof t and Loss and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

iv) in our opinion the Balance Sheet, Statement of Prof t & Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in section 211 (3C) of the Act;

v) on the basis of written representations received from the directors as on March 31, 2013 and taken on record by the Board of Directors we report that none of the directors is disqualif ed as on March 31, 2013 from being appointed as director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956; and (Referred to in paragraph 1 under the heading of "Report on Other Legal and Regulatory Requiremens" of our report of even date)

1. The Company has maintained proper records to show full particulars including quantitative details and situation of its f xed assets.

2. The f xed asset of the Company has been physically verif ed by the management during the year.

3. During the year, the Company has not disposed of any of its f xed assets.

4. The Company did not hold any inventories during the year.

5. The following are the particulars of unsecured loans taken / granted by the Company from / to companies f rms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

5 Tulip Hotels Pvt Ltd Common Directors Nil 13,84,00,000 Interest at 14% p.a. is charged by Cox & Kings Ltd, which rate in our opinion is not prejudicial to the interest of the Company.

We are given to understand that loan from Tulip Hotels Pvt. Ltd. is interest free, which is not prejudicial to the interest of the Company.

We are given to understand by the Company''s management that loan from Cox & Kings Ltd. is repayable on demand, which in our opinion is prima facie prejudicial to the interest of the Company.

According to the information and explanations given to us, loan from Cox & Kings Ltd. is repayable on demand and others are to be repaid at the end of tenure. Accordingly the question of regularity in repayment of principal does not arise.

Details of loans granted:

No. Party Relationship Amount Rs. Year-End Balance Rs.

1 V Hotels Ltd. Common Directors – 37,00,00,000

As the above loan is interest free, we are of the opinion that terms and conditions with respect to interest in case of loans granted are prima facie prejudicial to the interest of the Company.

There are no stipulations as regards repayments of these loans. Consequently, we are unable to comment on the regularity or otherwise of repayment of principal.

In view of the above comment, the question of overdues does not arise. There is no evidence to indicate steps taken by the Company for recovery.

6. In our opinion and according to the information and explanations given to us there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventories, f xed assets and with regard to the sale of goods / services.

Further, during the course of our audit, we have neither come across nor have we been informed of any instances indicative of major weaknesses in the aforesaid internal control procedures, which would require corrective action.

7. On the basis of our examination of the books of account and according to the information and explanations provided by the management 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.

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

9. The Company has not accepted any deposits from the public during the year under sections 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. Further, during the course of our audit, we have neither come across nor have we been informed of any order passed under the aforesaid sections by the National Company Law Tribunal during the year.

10. The Company does not have an internal audit system.

11. In our opinion, clause VIII of paragraph 4 of the aforesaid Order pertaining to maintenance of cost records under section 209 (1)(d) of the Companies Act, 1956 is not applicable to the Company.

12. According to the books and records as produced before us and examined by us in accordance with generally accepted auditing practices in India and the managements representation, we are of the opinion that the Company is regular in depositing, barring investor protection fund, with appropriate authorities undisputed statutory dues including Provident Fund, Employees'' State Insurance, except for Tax Deducted at source Income Tax. Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess are not applicable to the Company.

The following unpaid statutory dues have remained outstanding as on 31.3.2013 for a period exceeding six months from the date they became payable.

Fringe Benef t Tax Rs. 2.75 Lac

ESIC Rs. 0.10 Lac

Provident Fund Rs. 0.93 Lac

Service Tax Rs. 1.77 Lac

Tax Deducted at Source Rs. 42.86 Lacs

13. According to the records of the Company there are no dues of Sales Tax, Income Tax, Service Tax, Customs Duty, Wealth Tax, Excise Duty / Cess which have not been deposited on account of any dispute Except the following:

Nature of Disputed Dues Amount In Lacs Forum where dispute is pending

Income Tax on completion of regular assessments 149.70 Hon''ble Income Tax Tribunal, New Delhi

for assessment year 2007-08

Penalty U/s 221(1) of the Income Tax Act, 1961 40.34 Hon''ble Income Tax Tribunal, New Delhi

14. The Company does not have accumulated losses as at the end of the year and the Company has incurred cash losses during the year and in the immediately preceding f nancial year.

15. The Company does not owe any dues to Banks/Financial Institutions and hence the clause (xi) of paragraph 4 of the aforesaid order is not applicable to the Company.

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

17. We are given to understand that the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benef t Fund / Society are not applicable to the Company.

18. According to the information and explanation given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other securities. We also report that the Company has held the Shares, Securities, Debentures and Other Securities in its own name.

19. The Company has given the following guarantees to various banks for loans taken by V Hotels Ltd. The details of guarantees are as follows:

According to the relevant records examined by us and on the basis of information and explanations given to us, as the terms and conditions of the guarantee given to consortium of banks amounting to Rs. 129 Cr. includes a clause that reserves to the consortium of banks the right to claim from the Company all sums due to them without having to f rst take recourse to the principal borrower, we are of the opinion that terms and conditions of the said guarantee are prejudicial to the interest of the Company.

20. According to the information and explanations given to us and on the basis of records examined by us no terms loans were raised during the year.

21. On the basis of review of utilization of funds on overall basis, the related information made available to us and as represented to us by the management, we are of the opinion that no funds raised on short term basis have been used for long term investments.

22. In our opinion and according to information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year.

23. Since the Company has not issued any debentures during the year, the question of creation of any security or charge does not arise.

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

25. During the course of our examination of books of account carried out in accordance with generally accepted auditing practices we have neither come across any instance of fraud on or by the management nor have we been informed of such case by the management.

For Ray & Ray

Chartered Accountants

Firm Reg. No. 301072E

Anil V. Karnik

Partner

Place : Mumbai Membership No. 31005

Date : May 29, 2013


Mar 31, 2010

1. We have audited the attached Balance Sheet of Tulip Stat Hotels Ltd. as at March 31, 2010 and the annexed Profit & Loss Account and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted out audit in accordance with auditing standards genetally accepted in India. These standards require that we plan and perform our audit to obtain reasonable assurance about whethet the financial statements are free of material misstatements. 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 the management, as well as evaluating the overall financial statement ptesentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Furthet to our comments in the Annexure referted to above, we repott 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 out 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;

iii) the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

iv) in out opinion the Balance Sheet, Profit & 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;

v) on the basis of written representations received from the directots as on March 31, 2010 and taken on record by the record by the Board of Directots we report that none of the directots is disqualified as on March 31, 2010 from being appointed as director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956; and

5. In out opinion and to the best of our information and according to the explanations given to us the said accounts lead together with notes thereon give the information requited by the Companies Act, 1956 in the manner so required and subject to Note No. 4 of Schedule 9 regarding non provision of interest on income tax dues amounting to Rs. 2,78,91,670 because of which Provision for Income Tax is understated and the balance of Profit and Loss Account Loss is overstated by the said amount give a true and fait view in conformity with the accounting pt inciples generally accepted in India:

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

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

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

ANNEXURE TO THE AUDITORS REPORT - (Referred to in paragraph 3 of our report of even date)

1. The Company has maintained proper records to show full particulars including quantitative details and situation of its fixed assets.

2. As the Company does not have any assets, clause (i) (b) of paragraph 4 of the aforesaid order is not applicable to the Company.

3. During the year, the Company did not have any assets. However, this does not adversely affect the going concern status of the Company.

4. The Company did not hold any inventories during the year.

5. The following are the particulars of unsecured loans taken / granted by the Company from / to companies firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956:

Details of loans taken:

No. Party Relationship Amount Rs. Year-End Balance Rs. 1 ABK Enterprises P Ltd Common Directors Nil 1,10,000

2 Cox And Kings (I) Ltd Common Directors 3,91,00,000 20,29,00,000

3 Ezeego One Travels and Common Directors Nil 1,00,00,000 Tours Ltd. Interest at 15% p.a. is charged by Cox & Kings India Ltd., which rate in our opinion is not prejudicial to the interests of the Company.

We are given to understand that loan from Ezeego One Travels and Tours Ltd. was interest free, which is not prejudicial to the interest of the Company.

We are given to understand that loan from ABK Enterprises Pvt. Ltd. is interest free, which is not prejudicial to the interest of the Company.

We are given to understand by the Companys management that these loans are repayable on demand, which in our opinion is prima facie prejudicial to the interests of the Company.

According to the information and explanations given to us, the abovementioned loans are repayable on demand. Accordingly the question of regularity in repayment of principal does not arise.

Details of loans granted:

No. Party Relationship Amount Rs. Year-End Balance Rs.

1 V Hotels Ltd.(formerly Common Directors - 37,00,00,000 known as Tulip Hospitality Services Ltd.)

As the above loan is interest free, we are of the opinion that terms and conditions with respect to interest in case of loans granted are prima facie prejudicial to the interest of the Company.

There are no stipulations as regards repayments of these loans. Consequently, we are unable to comment on the regularity or otherwise of repayment of principal.

In view of the above comment, the question of overdues does not arise. There is no evidence to indicate steps taken by the Company for recovery.

6. In our opinion and according to the information and explanations given to us there are adequate internal control procedures commensurate with the size of the Company and the natute of its business with regard to purchase of inventories, fixed assets and with regard to the sale of goods / services.

Further, during the course of our audit, we have neither come across nor have we been informed of any instances indicative of major weaknesses in the aforesaid internal control procedures, which would require corrective action.

7. On the basis of our examination of the books of account and according to the information and explanations provided by the management 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.

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

9- The Company has not accepted any deposits from the public during the year under sections 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. Further, during the course of our audit, we have neither come across nor have we been informed of any order passed under the aforesaid sections by the National Company Law Tribunal during the year.

10. The Company does not have an internal audit system.

11. In our opinion, clause VIII of paragraph 4 of the aforesaid Order pertaining to maintenance of cost tecords under section 209 (l)(d) of the Companies Act, 1956 is not applicable to the Company.

12. According to the books and records as produced before us and examined by us in accordance with generally accepted auditing practices in India and the managements representation, we are of the opinion that the Company is regular in depositing, barring investor protection fund, with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, except for Tax Deducted at source Income Tax. Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess are not applicable to the Company.

The following unpaid statutory dues have remained outstanding as on 31.3.2010 for a period exceeding six months from the date they became payable.

Income Tax Payable for AY 2007-08 Rs. 456.00 Lacs

Tax Deducted at Source Rs. 29.34 Lacs

Fringe Benefit Tax Rs. 2.75 Lac

13. According to the records of the Company there are no dues of Sales Tax, Income Tax, Service Tax, Customs Duty, Wealth Tax, Excise Duty / Cess which have not been deposited on account of any dispute Except the following:

Nature of Disputed Dues Amount Rs. In Lacs Forum where dispute is pending

Income Tax on completion of regular 149.70 Commissioner of Income Tax (Appeals), assessments for assessment year 2007-08 New Delhi

14. The Company does not have accumulated losses as at the end of the year and the Company has incurred cash losses during the year and in the immediately preceding financial year.

15. The Company does not owe any dues to Banks/Financial Institutions and hence the clause (xi) of paragraph 4 of the aforesaid order is not applicable to the Company.

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

17. We are given to understand that the provisions of any special statute applicable to Chit Fund, Nidhi or Mutual Benefit Fund / Society are not applicable to the Company.

18. According ro the information and explanation given to us, the Company is not dealing or trading in Shares, Securities, Debentures and other securities. We also report that the Company has held the Shares, Securities, Debentures and Other Securities in its own name.

19. The Company has given the following guarantees to various banks for loans taken by V Hotels Ltd. The details of guarantees are as follows:

Name of the Bank Amount of Guarantee given (Rs.)

Consortium of Banks 129,00,00,000

Plus interest

Canara Bank 4,40,00,000

ICICI Bank 12,40,000

According to the relevant records examined by us and on the basis of information and explanations given to us, as the terms and conditions of the guarantee given to consortium of banks amounting to Rs. 129 Cr. includes a clause that reserves to the consortium of banks the right to claim from the Company all sums due to them without having to first take recourse to the principal borrower, we are of the opinion that terms and conditions of the said guarantee are prejudicial to the interests of the Company.

20. According to the information and explanations given to us and on the basis of records examined by us no terms loans were raised during the year.

21. On the basis of review of utilization of funds on overall basis, the related information made available to us and as represented to us by the management, we are of the opinion that no funds raised on short term basis have been used for long term investments.

22. In our opinion and according to information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year.

23. Since the Company has not issued any debentures during the year, the question of creation of any security or charge does not arise.

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

25. During the course of our examination of books of account carried out in accordance with generally accepted auditing practices we have neither come across any instance of fraud on or by the management nor have we been informed of such case by the management.

For Ray & Ray

Chartered Accountants Anil V. Karnik

Partner Place : Mumbai Membership No. 31005

Date : May 31, 2010 Firm Reg. No. 301072E

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