Mar 31, 2019
INDEPENDENT AUDITOR''S REPORT TO THE MEMBERS OF TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED REPORT ON THE AUDIT OF STANDALONE FINANCIAL STATEMENTS Opinion
We have audited the accompanying standalone IND AS financial statements of TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2019 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 (hereinafter referred to as âstandalone Ind AS financial statementsâ).
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 Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the independence requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. 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.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report:
Sr. No. |
Key Audit Matters |
1. |
Evaluation of uncertain tax Positions The Company has material uncertain tax positions including matters under dispute which involves significant judgment to determine the possible outcome of these disputes, (refer note 25 to the standalone financial statements. |
Auditor''s Response: We have obtained the details of tax assessments & demands for all the cases disputed from the Management. We involved our internal expertise to challenge the Management''s underlying assumptions over the possible outcome of the disputes. We have also considered other rulings in evaluating the Management''s position on these uncertain tax positions. Additionally, we considered the effect of new information in respect of uncertain tax positions as at 1st April, 2018 to evaluate whether any change was required on these uncertainties. |
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 (âthe Actâ) with respect to the preparation of these standalone IND AS financial statements that give a true and fair view of the financial position and financial performance Other comprehensive income cash flows and changes in equity of the Company in accordance with the Indian Accounting Standards (IND AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.
This responsibility also includes maintenance of adequate accounting records in accordance with the preparation 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.
In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are responsible for overseeing the Company''s financial reporting process.
Auditors'' Responsibility
Our responsibility is to express an opinion on these standalone IND AS financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. 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 IND AS financial statements.
Auditor''s Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
- Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Other Matter
Non Provision of Doubtful Loans & Advances amounting to Rs.2272.77 lacs advanced to its subsidiary company and Group Company.
We further report that, had the observation made by us above been considered, the loss for the year would have been Rs.1722.02 lacs (as against the reported profit figure of Rs.550.75 lacs) and loss after considering accumulated figures of previous years would have been Rs.46.62 lacs (as against reported figure of profit of Rs. 2226.15 Lacs) and the balance of amount due from subsidiary company and group company would have been Rs. Nil (as against the reported figure of Rs.2272.77 lacs).
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion Paragraph above, 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, 2019, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors 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 âAnnexure Aâ a statement on the matters specified in paragraphs 3 & 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, Statement of Other Comprehensive Income, Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
(d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, our opinion, the aforesaid standalone IND AS 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, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2019 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) In our opinion the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure Bâ
(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, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has not disclosed the impact of pending litigations on its financial position in its financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There were no amounts which required to be transferred to the Investor''s
Education and Protection fund
1. The company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the company and the nature of its assets.
As per the information and explanations provided to us, there are no immovable fixed assets in the name of the Company.
2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.
3. The company has granted interest free loans of Rs.2272.77 to the company listed in the register maintained under section 189 of the Companies Act 2013. But the said Loan advanced to subsidiary company and Group Company to the extent of Rs.2272.77 doubtful in recovery.
4. During the year under audit, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 in respect of loans, investments, guarantees and security.
5. During the year under audit, the company has not accepted any deposits from the public to which the directives issued by Reserve Bank of India or the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under apply.
6. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 148(1) of the Companies Act, 2013, in respect of any activities carried on by the company.
7. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31st March, 2019 which have not been deposited on account of a dispute pending are as under:
Name of Statute |
Nature of dispute |
Amount (Rs. in lacs) |
Period for which the amount relates |
Forum where dispute is pending |
Income Tax Act, 1961 |
Income tax |
4.81 |
A.Y 1995-96 |
ACIT |
Income Tax Act, 1961 |
Income tax |
104.96 |
A.Y 1996-97 |
ACIT |
Income Tax Act, 1961 |
Income tax |
1.33 |
A.Y 2006-07 |
ACIT |
Income Tax Act, 1961 |
Income tax |
55.45 |
A.Y 2007-08 |
ITAT |
Income Tax Act, 1961 |
Income tax |
68.69 |
A.Y 2007-08 |
CIT-Appeal |
Income Tax Act, 1961 |
Income tax |
4.57 |
A.Y 2010-11 |
ACIT |
Income Tax Act, 1961 |
Income tax |
259.71 |
A.Y 2014-15 |
ITO |
Income Tax Act, 1961 |
Income tax |
22.74 |
A.Y 2015-16 |
CIT - Appeal |
8. On the basis of records examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.
9. According to the information and explanations given to us, the company has not raised any moneys by way of initial public offer or further public offer or any term loans during the year under review
10. To the best of our knowledge and belief and according to the information and explanations given to us we have not come across any fraud by the company or any fraud on the Company by its officers or employees during the course of our audit of the period under review.
11. During the year under audit, the company has not paid any managerial remuneration. Thus paragraph 3(xi) of the order is not applicable to the company.
12. In our opinion and according to information and explanations given to us, the company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the order is not applicable.
13. According to the information and explanations given to us and the records examined by us, the transaction with the related parties are in compliance with the provisions of section 177 and section 188 of the Companies Act, 2013 and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
14. According to the information and explanations given to us and the records examined by us, the company has not made any preferential allotment and private placement of shares during the year. Accordingly, paragraph 3(xiv) of the order is not applicable.
15. According to the information and explanations given to us and the records examined by us, 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.
16. The Company is required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
Report on the Internal Financial Controls under clause (i) of sub-section 3 of section 143 of the companies act, 2013 (âthe actâ)
We have audited the internal financial controls over financial reporting of TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED (âthe Companyâ) as of 31st March, 2019
in conjunction with our audit of the standalone IND AS 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 (the âGuidance Noteâ) issued by the Institute of Chartered Accountants of India. 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 and the Standards on Auditing 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 standalone Ind AS 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 system 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 (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 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, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2019, 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.
For Lakhani & Lakhani
Chartered Accountants
Firm Registration No: 115728W
Suhas Shinde
Partner
Membership No. 117107
Place: Mumbai
Date: 15th May, 2019
Mar 31, 2016
TO THE MEMBERS OF TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED
Report on the Financial Statements
We have audited the accompanying standalone financial statements of TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2016 and the Statement of Profit and Loss and the Cash Flow Statement, and a summary of the significant accounting policies and other explanatory information for the year then ended.
Managementâs Responsibility for the Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position and 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 Companies Act,
2013 read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the preparation 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.
Auditorsâ Responsibility
Our responsibility is to express an opinion on these standalone financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditorâs 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 Companyâs 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 Companyâs 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.
Basis of Opinion
Non Provision of Doubtful Loans & Advances amounting to Rs.2951.16 lacs advanced to its subsidiary company.
We further report that, had the observation made by us above been considered, the loss for the year would have been Rs.2922.55 lacs (as against the reported profit figures of Rs. 28.61 lacs) and loss after considering accumulated figures of previous years would have been Rs. 2361.56 lacs (as against reported figure of profit of Rs. 589.60 Lacs) and the balance of amount due from subsidiary company would have been Rs. Nil (as against the reported figure of Rs. 2951.16 lacs).
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion Paragraph above and Notes to Accounts, 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:
(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 profit of the Company for the year ended on that date
(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub section (11) of section 143 of the Act, we give in the âAnnexure Aâ a statement on the matters specified in paragraphs 3 & 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this
Report are in agreement with the books of account.
(d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014
(e) The matter described in the basis of qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the company.
(f) On the basis of the written representations received from the directors as on 31st March, 2016 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.
(g) In our opinion the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure Bâ
(h) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion Paragraph above.
(i) With respect to the other matters to be included in the Auditorâs 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 not disclosed the impact of pending litigations on its financial position in its financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investorâs Education and Protection fund by the company.
1. The company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies were noticed on such verification. In our opinion the verification is reasonable having regard to the size of the company and the nature of its assets.
2. The company is primarily engaged in investing activities. Accordingly, it does not hold any physical inventories. Thus paragraph 4(ii) of the Order is not applicable to the company.
3. The company has granted interest free loans of Rs. 2951.16 lacs to the company listed in the register maintained under section 189 of the Companies Act 2013. But the said Loan advanced to subsidiary company amounting to Rs.2951.16 lacs is doubtful in recovery.
4. During the year under audit, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 in respect of loans, investments, guarantees and security.
5. During the year under audit, the company has not accepted any deposits from the public to which the directives issued by Reserve Bank of India or the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under apply.
6. We have been informed that Central Government has not prescribed the maintenance of cost records under Section 148(1) of the Companies Act, 2013, in respect of any activities carried on by the company.
7. According to the information and explanations given to us, the company has been regular in depositing Employees Provident Fund dues and has also been regular in depositing undisputed income tax and other applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the records of the Company examined by us, the particulars of income tax as at 31st March 2016 which have not been deposited on account of a dispute pending are as under:
Name of the Statute |
AY |
Nature of Dispute |
Forum where the disputes are pending |
Amount Disputed |
Income tax Act, 1961 |
1995-96 |
Demand raised subject to rectification by ACIT |
ACIT Company Circle III (2) |
Rs.4.81 lacs |
Income tax Act 1961 |
1996-97 |
Rectification by AO raised a demand Company has to file rectification for the interest working 234B Waiver petition filed by the company. Expecting a relief of Rs 45 lacs |
ACIT Company Circle-III(2) CCIT-I , Chennai |
Rs.104.96lacs |
Income tax Act, 1961 |
2003-04 |
Diminution in the value of stock- Rs. 1289 lacs (value written off) However there will not be any demand on this issue only carried forward loss will be reduced. However the Carried forward loss will be useful for AY 2007-2008 demand. |
Madras High Court |
NIL |
Income tax Act 1961 |
2005-06 |
Assessment was re-opened for third time and order dated 28.03.2013 AO rejected the Excess relief u/s 115JB BCIT(A) has ordered in ITA No. No.646/2013-14/CIT(A)-11 rejecting the the Jurisdictions and on facts remanded back to AO |
CIT(A)-III |
Rs. 35.15 lacs |
Income tax Act 1961 |
2006-07 |
B/F loss not considered, rectification filed |
ACIT Company Circle III (2) |
Rs.1.33 lacs |
Income tax Act, 1961 |
2007-08 |
Department has filed appeal before Hon''ble ITAT on the issue of Short Term Capital gains @ 30.99% instead of 15% Revision order by AO has not considered the Rebate which is pending The Hon''ble ITAT vide order dated........... remanded back to Ld CIT(A) to adjudicate the same Ld CIT(a) has remanded back the matter to AO and it is pending with AO |
ITAT |
Rs.55.45 lacs |
Income tax 1961 |
2007-08 |
Department issued 148 notice and the assessment got completed The same issue of STCG @ 30.99 instead of 15%, assessment completed. Company had filed appeal before Commissioner Appeal-III Further to ITAT remanding back to Ld CIT(A),. Ld CIT(A) clubbed both the appeals and since the issue is common and had remanded the matter to AO on the issue on whether sale of shares is Business or Capital gains |
CIT-Appeal -III |
Rs 68.69 lacs |
Income tax Act 1961 |
2010-11 |
The Assessment was reopened u/s 148 on the issue of Client Modification code The Company has filed appeal against the order. |
ACIT Corporate Circle-3(1), Chennai |
Rs 4.57lacs |
8. On the basis of records examined by us and the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders.
9. According to the information and explanations given to us, the company has not raised any moneys by way of initial public offer or further public offer or any term loans during the year under review
10. To the best of our knowledge and belief and according to the information and explanations given to us we have not come across any fraud by the company or any fraud on the Company by its officers or employees during the course of our audit of the period under review.
11. During the year under audit, the company has not paid any managerial remuneration. Thus paragraph 3(xi) of the order is not applicable to the company.
12. In our opinion and according to information and explanations given to us, the company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the order is not applicable.
13. According to the information and explanations given to us and the records examined by us, the transaction with the related parties are in compliance with the provisions of section 177 and section 188 of the Companies Act, 2013 and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
14. According to the information and explanations given to us and the records examined by us, the company has not made any preferential allotment and private placement of shares during the year. Accordingly, paragraph 3(xiv) of the order is not applicable.
15. According to the information and explanations given to us and the records examined by us, the company has not entered into noncash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the order is not applicable.
16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
Report on the Internal Financial Controls under clause (i) of sub-section 3 of section 143 of the companies act, 2013 (âthe actâ)
We have audited the internal financial controls over financial reporting of TWENTYFIRST CENTURY
MANAGEMENT SERVICES LIMITED (âthe Companyâ) as of 31st March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs 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 (âICAIâ). 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 companyâs 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.
Our responsibility is to express an opinion on the Companyâs 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 âGuidance Noteâ) and the Standards on Auditing, 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, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. 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 auditorâs 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 Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companyâs 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 companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs 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 system 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 on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For Lakhani & Lakhani
Chartered Accountants
Firm Registration No. 115728W
Suhas Shinde
Partner
Membership No. 117107
Place: Mumbai
Date: 19-05-2016
Mar 31, 2015
Report on the Financial Statements
We have audited the accompanying standalone financial statements of
TWENTYFIRST CENTURY MANAGEMENT SERVICES LIMITED ("the Company"), which
comprise the Balance Sheet as at 31st March, 2015, the Statement of
Profit and Loss and the Cash Flow Statement and a summary of the
significant accounting policies and other explanatory information for
the year then ended.
Management''s Responsibility for the 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 and 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, 2013 read with Rule 7
of the Companies (Accounts) Rules, 2014. This responsibility also
includes maintenance of adequate accounting records in accordance with
the preparation of the Act for safeguarding the assets of the Company
and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditors'' Responsibility Our responsibility is to express an opinion
on these standalone financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
there under.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company''s preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances. 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.
Basis of Opinion
Non Provision of Doubtful Loans & Advances amounting to Rs. 2272.22
lacs advanced to its subsidiary company.
We further report that, had the observation made by us above been
considered, the profit for the year would have been Rs. 217.28 lacs (as
against the reported profit figures of Rs. 2489.50 lacs) and profit
after considering accumulated loss of previous years would have been
Rs. 33.33 lacs (as against reported figure of profit of Rs. 2305.55
Lacs) and the balance of amount due from subsidiary company would have
been Rs. Nil (as against the reported figure of Rs. 2272.22 lacs).
Qualified Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified Opinion Paragraph above and Notes
to Accounts, 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:
(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 Profit and Loss, of the profit of
the Company for the year ended on that date
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (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 paragraphs 3 & 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
(b) Except for the effects of the matter described in the Basis for
Qualified Opinion paragraph above, in our opinion, proper books of
account as required by law have been kept by the Company so far as it
appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) Except for the effects of the matter described in the Basis for
Qualified Opinion paragraph above, our opinion, the aforesaid
standalone financial statements comply with the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014
(e) The matter described in the basis of qualified Opinion paragraph
above, in our opinion, may have an adverse effect on the functioning of
the company.
(f) On the basis of the written representations received from the
directors as on 31st March, 2015 taken on record by the Board of
Directors,
none of the directors is disqualified as on 31st March, 2015 from being
appointed as a director in terms of Section 164 (2) of the Act.
(g) In our opinion the internal financial controls over financial
reporting of the Company and the operating effectiveness of such
controls are adequate.
(h) The qualification relating to the maintenance of accounts and other
matters connected therewith are as stated in the Basis for Qualified
Opinion Paragraph above.
(i) 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 not disclosed the impact of pending litigations of
Income Tax Act 1961 on its financial position in its financial
statements.
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses.
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor''s Education and Protection Fund by the
company.
ANNEXURE TO THE AUDITORÂS REPORT
1. The company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
The fixed assets of the company have been physically verified by the
Management during the year and no material discrepancies were noticed
on such verification. In our opinion the verification is reasonable
having regard to the size of the company and the nature of its assets.
2. The company is primarily engaged in investing activities.
Accordingly, it does not hold any physical inventories. Thus paragraph
4(ii) of the Order is not applicable to the company.
3. The company has granted interest free loans of Rs. 2272.22 lacs to
the company listed in the register maintained under section 189 of the
Companies Act 2013. But the said Loan advanced to subsidiary company
amounting to Rs.2272.22 lacs is doubtful in recovery.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business for the
purchase of fixed assets and Sale of services. The nature of the
Company''s activities is such that it does not involve purchase of
inventories and sale of goods. During the course of our audit, we have
not observed any major weaknesses in the internal control system of the
Company and hence, the question of any continuing failure to correct
the same does not arise.
5. During the year under audit, the company has not accepted any
deposits from the public to which the provisions of Sections 73 to 76
or any other relevant provisions of the Companies Act, 2013 and the
rules framed there under apply.
6. We have been informed that Central Government has not prescribed
the maintenance of cost records under Section 148(1) of the Companies
Act, 2013, in respect of any activities carried on by the company.
7. According to the information and explanations given to us, the
company has been regular in depositing Employees Provident Fund dues
and has also been regular in depositing undisputed income tax and other
applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the
records of the Company examined by us, the particulars of income tax as
at 31 st March 2015 which have not been deposited on account of a
dispute pending are as under:
Name AY Nature Forum where Amount
of the of the disputes Disputed
Statute Dispute are pending
Income 1995 - Demand raised ACIT Company Rs.4.81
tax Act, 96 subject to recti- Circle III (2) lacs
1961 fication by ACIT
Income 1996 - Rectification by ACIT Company Rs. 104.96
tax Act, 97 AO raised a Circle III (2) lacs
1961 demand
Company has to
file rectification
for the interest
working 234B waiver
CCIT- I, Chennai
petition filed by
the company,
Expecting a relief
of Rs. 45 lacs
Income 2003 - Diminution in the Madras High Nil
tax Act, 04 value of stock Rs. Court
1961 1289 Lacs (Value
written off)
However there will
not be any demand
on this issue only
carried forward
loss will be
reduced.
However the Carried
forward loss will
be useful for AY
2007-2008 demand.
Income 2005 - Assessment was CIT(A) III Rs. 35.15
tax Act, 06 re-opened for third
lacs 1961 time and
order dated
28.03.2013 AO
rejected the Excess
relief u/s 115 JB
Jurisdiction is
questioned
Income 2006 - B/F loss not ACIT Company Rs. 1.33
tax Act, 07 c onsidered, Circle III (2) lacs
1961 rectification
filed
Name AY Nature Forum where Amount
of the of the disputes Disputed
Statute Dispute are pending
Income 2007 - Department has ITAT Rs.55.45
tax Act, 08 filed appeal before lacs
1961 Hon''ble ITAT on the
issue of Short Term Capital
gains @30.99% instead of 15% .
Revision order by AO has not
consid- ered the Rebate which
is pending.
Income 2007 - Department issued CIT- Rs.68.69
tax Act, 08 148 notice and the Appeal III lacs
1961 assessment got
completed The same issue of
STCG @30.99% instead of 15%
assessment completed.
Company had filed appeal
before Commissioner
Appeal - III
Income 2009 - No demand,However penalty 1961 CIT Nil
tax Act, 10 has been initiated for Appeal III
addition u/s 14A As penalty
initiated the company has
filed Appeal before
Commissioner Appeal III it
is pending
Income 2010 - Credit for Self ACIT Rs.
tax Act, 11 Assessment Tax1961 of Company 13.28
Rs. 7.02 Lacshas not Circle lacs
been given,rectification III (2)
field
Income 2011 - Intimation u/s ACIT
tax Act, 12 143 (1) wrongly 1961 passed, Company Rs.
Rectification filed and it Circle 830.20
is pending III (2) lacs
8. The company has accumulated loss of Rs. 183.95 lacs till the
immediately preceding financial year but has earned profit of Rs.
2489.50 lacs during the current financial year under this report which
writes off the accumulated loss of the company.
9. On the basis of records examined by us and the information and
explanations given to us, the company has not defaulted in repayment of
dues to financial institutions, banks or debenture holders.
10. According to the information and explanations given to us the
company has not given any guarantee for the loans taken by others from
banks or financial institutions.
11. According to the information and explanations given to us, the
company has not obtained any term loans during the year under review.
21. To the best of our knowledge and belief and according to the
information and explanations given to us, fraud in the nature of
misappropriation of uncleared demand draft of Rs. 61.20 lakhs by an
official of the company, which was lying with his custody, has been
noticed and reported during the course of our audit.
For Lakhani & Lakhani
Chartered Accountants
(Firm Registration No.115728W)
Suhas Shinde (M.No. 117107)
Partner
Place: Mumbai
Date : 16-05-2015
Mar 31, 2014
We have audited the accompanying financial statements of TWENTYFIRST
CENTURY MANAGEMENT SERVICES LIMITED ("the Company"), which comprise the
Balance Sheet as 31st March, 2014 and the Statement of Profit and Loss
and the Cash Flow Statement for the year then ended, and a summary of
at 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 and financial performance of the Company in accordance with
the Accounting Standards referred to in Section 211(3C) of the
Companies Act, 1956 ("the Act") and in accordance with the accounting
principles generally accepted in India. This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.
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 the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the 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
a. Non provision for Gratuity has been made in accounts, in the event
of any employee leaving the services by reason of death / incapability
/ retirement or resignation. Amount not ascertained.
b. Non Provision of Doubtful Loans & Advances amounting to Rs. 2134.90
lacs advanced to its subsidiary company.
We further report that, had the observation made by us in point (b) of
Para above been considered, the loss for the year would have been Rs.
2160.55 lacs (as against the reported loss figures of Rs. 25.65 lacs)
and accumulated loss would have been Rs.2318.85 Lacs (as against
reported figure of accumulated Loss of Rs. 183.95 Lacs) and the balance
of amount due from subsidiary company would have been Rs. Nil (as
against the reported figure of Rs. 2134.90 lacs),
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the above paragraph, the financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
a) in the case of 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.
c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("th
eOrder") 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 paragraph 4 & 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the 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 the Statement of Profit and Loss and Cash
Flow statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion the Balance Sheet and the Statement of Profit & Loss
comply with the Accounting Standards referred to in Section 211(3C) of
the Act,
(e) On the basis of the written representations received from the
directors, as on 31st March 2014 and taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2014
from being appointed as a director in terms of section 274(1)(g) of the
Act.
ANNEXURE TO THE AUDITOR''S REPORT
1. The Company has maintained proper records showing full particulars,
including quantitative details and situations of fixed assets.
The fixed assets of the company have been physically verified by the
Management during the year and no material discrepancies were noticed
on such verification. In our opinion the verification is reasonable
having regard to the size of the Company and the nature of its assets.
As per the information and explanations given to us, during the year,
the company has not disposed off any substantial part of the fixed
assets that would affect the going concern.
2. The company is primarily engaged in investing activities.
Accordingly, it does not hold any physical inventories. Thus paragraph
4(ii) of the Order is not applicable to the company.
3. The company has taken interest free loans of Rs. 5.50 Lacs from
companies or firms listed in the register maintained under section 301
of the Companies Act 1956 and from company under the same management.
The company has granted interest free loans of Rs. 2152.76 lacs to the
companies listed in the register maintained under section 301 of the
Companies Act 1956. In our opinion the terms & conditions of said loan
is not prima facie prejudicial to the Interest of the Company. In our
opinion the terms & conditions of said loan is not prima facie
prejudicial to the Interest of the Company. But the Loan advanced to
subsidiary company amounting to Rs. 2134.90 Lacs is doubtful in
recovery.
4. The Company has adequate internal control procedures commensurate
with its size and nature of business with regard to purchase of shares,
fixed assets and for the sale of shares, assets or equipments. We have
not observed any continuing failure to correct such internal control
systems.
5. The transactions that are required to be entered into the register
in pursuance of Section 301 of the act have been so entered.
In our opinion and according the information and explanations given to
us the transactions made in pursuance of contracts or arrangements
entered in the register maintained u/s 301 of the Companies Act 1956
and exceeding the value of Rs.5 Lacs in respect of any party during the
year have been made at prices which are reasonable, having regard to
prevailing market prices at the relevant time where such market prices
are available.
6. During the year under review, the company has not accepted any
deposits from the public to which the provisions of Section 58A of the
Companies Act, 1956 apply.
7. Company does not have any internal audit department, commensurate
with the size of the company and nature of its business.
8. We have been informed that Central Government has not prescribed
the maintenance of cost records under Section 209(1)(d) of the
Companies Act, 1956, in respect of any activities carried on by the
Company.
9. According to the information and explanations given to us, the
company has been regular in depositing Employees Provident Fund dues
and has also been regular in depositing undisputed income tax and other
applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the
records of the Company examined by us, the particulars of income tax as
at 31st March 2014 which have not been deposited on account of a
dispute pending are as under:
Name AY Nature Forum where Amount
of the of the disputes Disputed
Statute Dispute are pending
Income 1995 - Demand raised ACIT Company Rs.4.81
tax Act, 96 Subject to recti- Circle III (2) lacs
1961 fication by ACIT
Income 1996 - Rectification by ACIT Company Rs. 104.96
tax Act, 97 AO raised a Circle III (2) lacs
1961 demand
Company has to
file
rectification for
the interest
working
34B waiver CCIT- I,
Chennai
Petition filed
by he company,
Expecting a relief
of Rs. 45 lacs
Income 2003 - Diminution in the Madras High Nil
tax Act, 04 Value of stock Rs. Court
1961 1289 Lacs (Value
Written off)
However there
will ot be any
demand n this
issue only arrived
forward loss
Will be reduced.
However the arrived
forward oss will
be useful or AY
2007-2008 demand.
Income 2005 - Assessment was CIT(A) III Rs. 35.15
tax Act, 06 re-opened for
third lacs
1961 Time and order
dated 28.03.2013
AO
rejected the
Excess
relief u/s 115 JB
Jurisdiction is
Questioned
Income 2006 - B/F loss not ACIT Company Rs. 1.33
tax Act, 07 Considered, Circle III (2) lacs
1961 rectification
filed
Name
of
Statute AY Nature Forum Where Amount Income
of Dispute the disputes Disputed
Income
tax Act,
1961 2007 - Department has ITAT Rs.55.45
08 filed appeal before Lacs
Hon''ble ITAT on the
issue of Short Term
Capital gains @
30.99% instead of
15% .
Revision order by
AO has not consid
-ered the Rebate
Which is pending.
Income 2007 - Department issued CIT-Appeal III Rs.68.69
tax Act, 08 148 notice and the lacs
1961 assessment got
Completed
The same issue o
STCG @30.99% ]
instead of 15%
assessment
Completed.
Company had filed
appeal before
Commissioner
Appeal - III
Income 2009 - No demand, CIT Appeal III Nil
tax Act, 10 However penalty
1961 as been
initiated for
addition u/s 14A
As penalty
initiated the
company has
filed Appeal
before
Commissioner
Appeal III it is
Pending
Income 2010 - Credit for Self CIT Company Rs. 13.28
tax Act, 11 Assessment Tax Circle III (2) lacs
1961 of Rs. 7.02 Lacs
has not been
given,
rectification
field
Income 2011 - Intimation u/s CIT Company Rs. 830.20
tax Act, 12 143 (1) wrongly Circle III (2) lacs
1961 Passed, Credit for
Self Assessment
Tax of Rs.182.04
Lacs has not been
given, Rectification
yet to be field
10. The company has accumulated loss of Rs. 158.30 lacs till the
immediately preceding financial year, has incurred a loss of Rs. 25.65
lacs during the current financial year under this report.
11. On the basis of records examined by us and the information and
explanations given to us, the Company has not defaulted in repayment of
dues to financial institutions, banks or debenture holders.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. In our opinion the company is not a Chit Fund or a Nidhi/Mutual
Fund/Society. Therefore the provisions of clause 4 (xiii) of the
companies (Auditor''s Report) Order, 2003 are not applicable to the
company.
14. The Company has maintained proper records of transactions and
contracts in respect of trading in shares, debentures and other
investments and timely entries have been made therein.
15. According to the information and explanations given to us the
company has not given any guarantee for the loans taken by others from
banks or financial institutions.
16. According to the information and explanations given to us, the
company has not obtained any term loans during the year under review.
17. On the basis of an overall examination of the balance sheet of the
company, in our opinion and according to the information and
explanations given to us, funds raised on short term basis, have not
been used for long term investments.
18. The company has not made any preferential allotment of shares
during the year.
19. There are no secured debentures issued during the year.
20. The company has not raised any money by public issue during the
year.
21. To the best of our knowledge and belief and 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 Lakhani & Lakhani
Chartered Accountants
(Firm Registration No.115728W)
Suhas Shinde (M.No. 117107)
Partner
Place: Mumbai
Date : 16-05-2014
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of TWENTYFIRST
CENTURY MANAGEMENT SERVICES LIMITED ("the Company"), which comprise
the Balance Sheet as 31st March, 2013 and the Statement of Profit and
Loss for the year then ended, and a summary of at 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 and financial performance of the Company in accordance with
the Accounting Standards referred to in Section 211 (3C) of the
Companies Act, 1956 ("the Act") and in accordance with the
accounting principles generally accepted in India. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from -material
misstatement, whether due to fraud or error.
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 the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also
includes evaluating the appropriateness of the 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 Company has not made any provision of Rs.
789.21 lacs being shortfall in the market value of quoted investment as
on 31.03.2013, because in the opinion of the management, the shortfall
is temporary in nature and investment is held for long term period.
The Financial statements are subject to Non Provision of Shortfall in
the value of investments amounting to Rs. 789.21 lacs,
We further report that, had the observation made by us in Para above
been considered, the loss for the year would have been Rs. 1013.34
lacs (as against the reported loss figures of Rs. 224.13 lacs) and
accumulated loss would have been Rs.947.51 Lacs (as against reported
figure of accumulated Loss of Rs. 158.30 Lacs) and the balance of
quoted investments would have been Rs. 636.15 lacs (as against the
reported figure of Rs. 1425.36 lacs),
The aforesaid financial statements give the information required by the
Companies 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 Balance Sheet, of the state of affairs of the Company
as at 31st March 2013 and
b) In the case of Profit & Loss Account, of the Loss of the company for
the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 (th
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 paragraph 4 & 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit.
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books.
(c) The Balance Sheet and the Statement of Profit and Loss dealt with
by this report are in agreement with the books of account.
(d) In our opinion the Balance Sheet and the Statement of Profit & Loss
comply with the Accounting Standards referred to in Section 211 (3C) of
the Act, subject to:
Note 2(h), in respect of non provision for Employees Benefit has been
made in accounts, in the event of any employee leaving the services by
reason of death / incapability / retirement or resignation. Amount not
ascertained.
(e) On the basis of the written representations received from the
directors, as on 31s'' March 2013 and taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2013
from being appointed as a director in terms section 274(1 )(g) of the
Act.
ANNEXURE TO THE AUDITOR''S REPORT
1. The Company has maintained proper records showing full particulars,
including quantitative details and situations of fixed assets.
The fixed assets of the company have been physically verified by the
Management during the year and no material discrepancies were noticed
on such verification. In our opinion the verification is reasonable
having regard to the size of the Company and the nature of its assets.
As per the information and explanations given to us, during the year,
the company has not disposed off any substantial part of the fixed
assets that would affect the going concern.
2. The company is primarily engaged in investing activities.
Accordingly, it does not hold any physical inventories. Thus paragraph
4(ii) of the Order is not applicable to the company.
3. The company has taken interest free loans from companies or firms
listed in the register maintained under section 301 of the company''s
act 1956 and from company under the same management. The company has
granted interest free loans of Rs. 1955.83 lacs to its subsidiary
company listed in the register maintained under section 301 of the
companies act, 1956 and from companies under the same management.
4. The Company has adequate internal control procedures commensurate
with its size and nature of business with regard to purchase of shares,
fixed assets and for the sale of shares, assets or equipments. We have
not observed any continuing failure to correct such internal control
systems.
5. The transactions that are required to be entered into the register
in pursuance of Section 301 of the act have been so entered.
In our opinion and according the information and explanations given to
us the transactions made in pursuance of contracts or arrangements
entered in the register maintained u/s 301 of the companies act 1956
and exceeding the value of Rs.5 Lacs in respect of any party during the
year have been made at prices which are reasonable, having regard to
prevailing market prices at the relevant time where such market prices
are available.
6. During the year under review, the company has not accepted any
deposits from the public to which the provisions of Section 58A of the
Companies Act, 1956 apply.
7. Company does not have any internal audit department, commensurate
with the size of the company and nature of its business.
8. We have been informed that Central Government has not prescribed
the maintenance of cost records under Section 209(1 )(d) of the
Companies Act, 1956, in respect of any activities carried on by the
Company.
9. According to the information and explanations given to us, the
company has been regular in depositing Employees Provident Fund dues
and has also been regular in depositing undisputed income tax and other
applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the
records of the Company examined by us, the particulars of income tax as
at 31s March 2013 which have not been deposited on account of a dispute
pending are as under:
Name AY Nature Forum where Amount
of the of the disputes Disputed
Statute Dispute are pending
Income 1995- Demand raised ACII Company Rs.4.81
tax Act, 96 subject to
recti- Circle III (2) lacs
1961 fication by ACIT
Income 1996- Rectification by ACIT Company Rs. 104.96
tax Act, 97 AO raised a Circle III (2) lacs
1961 demand
Company has to
file
rectification
for the interest
working
234B waiver CCITI, Chennai
petition filed
by the company,
Expecting a
relief of Rs.
45 lacs
Income 2005- Assessment was CIT(A) III Rs. 35.15
tax Act, 06 re-opened for lacs
1961 third time and
order dated
28.03.2013 AO
rejected the
Excess relief
u/s 115 JB
Jurisdiction
is questioned
Income 2006- B/F loss not ACIIT Company Rs. 1.33
tax Act, 07 considered, Circle III (2) lacs
1961 rectification
filed
Income 2007- Department has ITAT Rs.55.45
tax Act, 08 filed appeal lacs
1961 before Homble
ITAT on the
issue of Short
Term Capital
gains @
30.99% instead
of 15% company.
Revision order
by AO has not
considered the
Rebate which
is pending.
Income 2010- Credit for Self ACII Company Rs. 13.28
tax Act, 11 Assessment Tax Circle III (2) lacs
1961 of Rs. 7.02 Lacs
has not been
given,
rectification
field
Income 2011- Intimation u/s ACII Company Rs. 830.20
tax Act, 12 143 (1) wrongly Circle III (2) lacs
1961 passed, Credit
for Self
Assessment Tax
of Rs.182.04
Lacs has not
been given,
Rectification
yet to be field
10. The company has accumulated loss of Rs. 133.57 lacs till the
immediately preceding financial year, has incurred a loss of Rs. 224.13
lacs during the current financial year under this report.
11. On the basis of records examined by us and the information and
explanations given to us, the Company has not defaulted in repayment of
dues to financial institutions, banks or debenture holders.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. In our opinion the company is not a Chit Fund or a Nidhi/Mutual
Fund/Society. Therefore the provisions of clause 4 (xiii) of the
companies (Auditor''s Report) Order, 2003 are not applicable to the
company.
14. The Company has maintained proper records of transactions and
contracts in respect of trading in shares, debentures and other
investments and timely entries have been made therein.
15. According to the information and explanations given to us the
company has not given any guarantee for the loans taken by others from
banks or financial institutions.
16. According to the information and explanations given to us the
company has not obtained any term loans during the year under review.
17. On the basis of an overall examination of the balance sheet of the
company, in our opinion and according to the information and
explanations given to us, funds raised on short term basis, have not
been used for long term investments.
18. The company has not made any preferential allotment of shares
during the year.
19. There are no secured debentures issued during the year.
20. The company has not raised any money by public issue during the
year.
21. To the best of our knowledge and belief and 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 M.B. Ladha & Company
Chartered Accountants
(Firm Registration No.105503W)
Mukesh Ladha (M.No.35544)
Proprietor
Place: Mumbai
Date : 30-05-2013
Mar 31, 2012
We have audited the attached Balance Sheet of Twentyfirst Century
Management Services Limited for the year ended 31st March 2012 and also
the Profit & Loss Account for the year ended on that date, annexed
thereto. These financial statements are responsibility of the
Company''s management. Our responsibility is to express an opinion on
these 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 misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
As required by the Companies (Auditors Report) Order, 2003 issued by
the Central Government of India in terms of Sub section (4A) of Sec.
227 of the Companies Act 1956, we enclose in the annexure a statement
on the matters specified in paragraph 4 & 5 of the said Order to the
extent applicable.
Further to our comments in the Annexure referred to above, we report
that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit.
(ii) In our opinion, the Company has kept proper books of account as
required by law so far as appears from our examination of the books.
(iii) In our opinion the Balance Sheet and Profit & Loss Account comply
with the accounting standards referred to in Sub section (3C) of
Section 211 of the Companies Act, 1956, subject to:
Note 2(h), in respect of no provision for gratuity has been made in
accounts, in the event of any employee leaving the services by reason
of death / incapability / retirement or resignation.
Note 13, in respect of non provision of sundry debtors amounting to Rs.
2307.13 lacs transferred from subsidiary company which are considered
good by the management.
Note 14(3), in respect of inoperative bank accounts amounting to Rs.
1.53 lacs, no confirmation is received and the accounts are neither
closed nor written off.
(iv) We further report that, had the observation made by us in Para
above, been considered, the loss for the year would have been Rs.
3072.25 lacs (as against reported loss of Rs.763.59 lacs) and
accumulated loss would have been Rs. 2442.23 lacs (as against reported
accumulated loss of Rs. 133.57 lacs) and sundry debtors would have been
Nil (as against reported sundry debtors of Rs. 2307.13 lacs) and Cash
and Bank balance would have been Rs. 14.83 lacs (as against reported
Cash and Bank balance of Rs. 16.36 lacs)
(v) The Balance Sheet and Profit & Loss A/c dealt with by this report
are in agreement with the books of account.
(vi) On the basis of written representations received from the
directors, as on 31s March 2012 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
31s March, 2012 from being appointed as a director in terms of clause
(g) of sub- section (1) of section 274 of the Companies Act, 1956.
(vii) In our opinion and to the best of our information and according
to the explanations given to us, the said financial statements, read
together with the notes thereon, give the information required by the
Companies Act, 1956, in the manner so required and present a true and
fair view, Subject to Para (iii) and (iv) above in conformity with the
accounting principles generally accepted in India:
a) in the case of Balance Sheet, of the state of affairs of the Company
as at 31st March 2012.
b) In the case of Profit & Loss Account, of the Loss of the company for
the year ended on that date.
c) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO THE AUDITOR''S REPORT
1. The Company has maintained proper records showing full particulars,
including quantitative details and situations of fixed assets.
The fixed assets of the company have been physically verified by the
Management during the year and no material discrepancies were noticed
on such verification. In our opinion the verification is reasonable
having regard to the size of the Company and the nature of its assets.
As per the information and explanations given to us, during the year,
the company has not disposed off any substantial part of the fixed
assets that would affect the going concern.
2. The company is primarily engaged in investing activities.
Accordingly, it does not hold any physical inventories. Thus paragraph
4(ii) of the Order is not applicable to the company.
3. The company has not taken any loans from companies or firms listed
in the register maintained under section 301 of the company''s act
1956 and from company under the same management. The company has not
given any loan to companies or firms listed in the register maintained
under section 301 of the companies act, 1956 and from companies under
the same management.
4. The Company has adequate internal control procedures commensurate
with its size and nature of business with regard to purchase of shares,
fixed assets and for the sale of shares, assets or equipments. We have
not observed any continuing failure to correct such internal control
systems.
5. The transactions that are required to be entered into the register
in pursuance of Section 301 of the act have been so entered.
In our opinion and according the information and explanations given to
us the transactions made in pursuance of contracts or arrangements
entered in the register maintained u/s 301 of the companies act 1956
and exceeding the value of Rs.5 Lacs in respect of any party during the
year have been made at prices which are reasonable, having regard to
prevailing market prices at the relevant time where such market prices
are available.
6. During the year under review, the company has not accepted any
deposits from the public to which the provisions of Section 58A of the
Companies Act, 1956 apply.
7. Company does not have any internal audit department, commensurate
with the size of the company and nature of its business.
8. We have been informed that Central Government has not prescribed
the maintenance of cost records under Section 209(1 )(d) of the
Companies Act, 1956, in respect of any activities carried on by the
Company.
9. According to the information and explanations given to us, the
company has been regular in depositing Employees Provident Fund dues
and has also been regular in depositing undisputed income tax and other
applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the
records of the Company examined by us, the particulars of income tax as
at 31s March 2012 which have not been deposited on account of a dispute
pending are as under:
Name AY Nature Forum where Amount
of the of the disputes Disputed
Statute Dispute are pending
Income 1995- Demand raised ACII Company Rs.20.20
tax Act, 96 subject to recti- Circle III (2) lacs
1961 fication by ACIT
Income 2003- Diminution in the Madras High Rs.1289
tax Act, 04 value of stock Court lacs
1961 (Value
written off)
Income 2006- Department has Commissioner Rs.562.33
tax Act, 07 disallowed the of Appeals-III, lacs
1961 Carrry forward Chennai-34.
Loss related to The Appeal has
AY 1998-99, been made
2003-04. The against 143(1)
company had of the Income
claimed the tax Act
Carry forward
loss related to
AY 2003-04, as
the matter is
pending before
Hon''ble Madras
High court
Income 2007- Department has Commissioner Rs.598.14
tax Act, 08 raised demand of Appeals-III, lacs
1961 on Short Term Chennai-34.
Capital gains @ The Appeal is
30.99% instead made against
of 15% company the order u/s
had claimed the 154 of the
Carry forward Income tax Act
loss related to
AY 2003-04, as
the matter is
pending before
Hon''ble Madras
High court
10. The company has no accumulated losses till the immediately
preceding financial year, but has incurred a losses of Rs. 763.59 Lacs
during the current financial year under this report.
11. On the basis of records examined by us and the information and
explanations given to us, the Company has not defaulted in repayment of
dues to financial institutions, banks or debenture holders.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. In our opinion the company is not a Chit Fund or a Nidhi/Mutual
Fund/Society. Therefore the provisions of clause 4 (xiii) of the
companies (Auditor''s Report) Order, 2003 are not applicable to the
company.
14. The Company has maintained proper records of transactions and
contracts in respect of trading in shares, debentures and other
investments and timely entries have been made therein.
15. The company has given corporate guarantee of Rs. 287.50 lacs for
the credit facilities availed by its subsidiary. According to the
information and explanations given by the management, in our opinion
the terms and conditions of the guarantee given for loans are not
prejudicial to the interest of the Company.
16. According to the information and explanations given to us, the
company has not obtained any term loans during the year under review.
17. On the basis of an overall examination of the balance sheet of the
company, in our opinion and according to the information and
explanations given to us, funds raised on short term basis, have not
been used for long term investments.
18. The company has not made any preferential allotment of shares
during the year.
19. There are no secured debentures issued during the year.
20. The company has not raised any money by public issue during the
year.
21. To the best of our knowledge and belief and 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 M.B. Ladha & Company
Chartered Accountants
(FRN: 105503W)
Mukesh Ladha (M.No.35544)
Proprietor
Place: Mumbai
Date: 30-05-2012
Mar 31, 2010
We have audited the attached Balance Sheet of TWENTYFIRST CENTURY
MANAGEMENT SERVICES LIMITED for the year ended 31st March 2010 and also
the Profit & Loss Account for the year ended on that date, annexed
thereto. These financial statements are responsibility of the
Companys management. Our responsibility is to express an opinion on
these 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 misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
As required by the Companies (Auditors Report) Order, 2003 issued by
the Central Government of India in terms of Subsection (4A) of Sec. 227
of the Companies Act 1956, we enclose in the annexure a statement on
the matters specified in paragraph 4 & 5 of the said Order to the
extent applicable.
Further to our comments in the Annexure referred to above, we report
that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit. ^
(ii) In our opinion, the Company has kept proper books of account as
required by law so far as appears from our examination of the books.
(iii) In our opinion the Balance Sheet and Profit & Loss Account comply
with the accounting standards referred to in Sub section (3C) of
Section 211 of the Companies Act, 1956, subject to note no. 1 (b) of
schedule - J in respect of no provision for gratuity and leave
encashment.
(iv) The Balance Sheet and Profit & Loss A/c dealt with by this report
are in agreement with the books of account.
(v) On the basis of written representations received from the
directors, as on 31s March 2010 and taken on record by the Board of
Directors, we report that none of the directors are disqualified as on
31s March, 2010 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
(vi) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements, read
together with the notes thereon, give the information required by the
Companies Act, 1956, in the manner so required and present a true and
fair view in conformity with the accounting principles generally
accepted in India:
a) in the case of Balance Sheet, of the state of affairs of the Company
as at 31s March 2010.
b) In the case of Profit & Loss Account, of the Profit of the company
for the year ended on that date.
c) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO THE AUDITORS REPORT
1. The Company has maintained proper records showing full particulars,
including quantitative details and situations of fixed assets.
The fixed assets of the company have been physically verified by the
Management during the year and no material discrepancies were noticed
on such verification. In our opinion the verification is reasonable
having regard to the size of the Company and the nature of its assets.
No substantial part of the fixed assets has been disposed off by the
company during the year.
2. The stock of shares of the company held in physical form has been
physically verified during the year by the Management. In our opinion,
having regard to the nature and location of stock, the frequency of
verification is reasonable. Most of the shares are held in
dematerialsed form.
In our opinion and according to the information and explanation given
to us, the procedures of physical verification of inventories followed
by the management are reasonable and adequate in relation to the size
of the company and nature of its business.
In our opinion and according to the information and explanation given
to us, the company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stock and
the book records were not material.
3. The Company has taken loan from Companies or firms listed in the
register maintained under section 301 of the Companys Act 1956 and
from Company under the same management. The maximum balance and the
year end balance is Rs. 5,50,000/-. The company has not given any loan
to Companies or firms listed in the register maintained under section
301 of the Companies Act 1956 and from company under the same
management.
4. The Company has adequate internal control procedures commensurate
with its size and nature of business with regard to purchase of shares,
fixed assets and for the sale of shares, assets or equipments. We have
not observed any continuing failure to correct such internal control
systems.
5. The transaction that are required to be entered into the register
in pursuance of Section 301 of the act have been so entered.
In our opinion and according the information and explanation given to
us the transactions made in pursuance of contracts or arrangements
entered in the register maintained u/s 301 of the companies act 1956
and exceeding the value of Rs.5 Lacs in respect of any party during the
year have been made at prices which are reasonable, having regard to
prevailing market prices at the relevant time where such market prices
are available.
6. During the year under review, the company has not accepted any
deposits from the public to which the provisions of Section 58A of the
Companies Act, 1956 are applicable.
7. The Company is not a manufacturing company and does not have any
scrap or by product.
8. In our opinion, the Company has an adequate internal audit system
commensurate with the size of the company and nature of its business.
9. We have been informed that Central Government has not prescribed
the maintenance of Cost Records under Section 209(1 )(d) of the
Companies Act, 1956, for any product of the Company. J
10. According to the information and explanations given to us, the
company been regular in depositing Employees Provident Fund dues and
has been also been regular in depositing undisputed income tax and
other applicable statutory dues with appropriate authorities.
No undisputed amount payable in respect of income tax, cess and other
material statutory dues, are in arrears as at 31st March, 2010 for
period exceeding six months except in respect of assessment year
2003-04, the Company has a disputed tax liability arising out of
addition of Rs. 1,292.48 Lakhs made by the Income-tax Officer and the
matter is pending before the Honble High Court of Madras. No provision
towards tax liability is considered necessary as this addition, which
is disputed, has not resulted in any additional tax liability and the
Company has been advised about favourable decisions.
11. The company has accumulated losses of Rs. 282.92 Lakhs till the
immediately proceeding financial year and has not incurred any loss
during the current financial year under this report.
12. On the basis of records examined by us and the information and
explanations given to us, the Company has not defaulted in repayment of
dues to financial institutions, banks or debenture holders.
13. The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Therefore the provisions of clause 4 (xii) of the companies (Auditors
Report) Ordered, 2003 are not applicable to the company.
14. In our opinion the company is not a Chit Fund or a Nidhi/Mutual
Fund/Society. Therefore the provisions of clause 4 (xiii) of the
companies (Auditors Report) Ordered, 2003 are not applicable to the
company.
15. The Company is dealing in shares and proper records have been
maintained for the transactions and contracts & timely entries have
been made therein & the shares have been held by the Company in its own
name.
16. According to the information and explanations given to us the
company has not given any guarantee for loans taken by others from
banks or financial institutions.
17. According to the information and explanations given to us, the
Company has not obtained any term loans during the year under review.
18. According to the information and explanations given to us no
preferential allotment of shares to parties and companies covered in
the register maintained u/s 301 of the Companies Act, 1956 has been
made during the period covered by our audit report.
19. According to the information and explanations given to us the
company has not issued any debentures during the year hence creation of
security is not applicable.
20. During the period covered by our audit report, the company has not
raised any money by public issue.
21. To the best of our knowledge and belief and 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.
ForShankar & Kishor
Chartered Accountants
S. B. Shetty(M.No.38139)
Partner
Place: Mumbai
Date: 24-05-2010