Auditor Report of Motor & General Finance Ltd.
Mar 31, 2018
Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements
1. We have audited the accompanying standalone Ind AS financial statements of The Motor & General Finance Limited (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2018, 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.
Managementâs Responsibility for the Standalone Ind AS Financial Statements
2. 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 Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the 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 provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.
4. In conducting our audit, we have taken into account the provisions of the Act and the Rules made thereunder including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
5. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorsâ judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
7. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the Ind AS and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2018, and its loss (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Other Matters
9. The comparative financial information of the Company for the year ended 31st March 2017 and the transition date opening balance sheet as at 1st April 2016 included in these standalone Ind AS financial statements, are based on the statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditor whose report for the year ended 31st March 2017 and 31st March 2016 dated 29th May, 2017 and 28th May, 2016 respectively expressed an unmodified opinion on those standalone financial statements, and have been restated to comply with Ind AS. Adjustments made to the previously issued said financial information prepared in accordance with the Companies (Accounting Standards) Rules, 2006 to comply with Ind AS have been audited by us.
Our opinion on the standalone Ind AS financial statements is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
10. As required by Section 143 (3) of the Act, based on our audit, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in equity dealt with by this Report are in agreement with the relevant books of account.
d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act.
e) On the basis of the written representations received from the directors of the Company as on 31st March, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2018 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) 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 disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note No. 30;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses during the year ended 31st March, 2018.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31st March, 2018.
11. As required by the Companies (Auditorâs Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (âthe Orderâ), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.
ANNEXURE âAâ TO THE INDEPENDENT AUDITORâS REPORT
Referred to in paragraph 10 of the Independent Auditorsâ Report of even date to the members of The Motor & General Finance Limited on the standalone Ind AS financial statements for the year ended 31st March, 2018
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of The Motor & General Finance Limited (âthe Companyâ) as of 31st March, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. 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 (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to 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 Act.
Auditorsâ Responsibility
3. 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 deemed to be prescribed under section 143(10) of the Act 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.
4. 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.
5. 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
6. 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
7. 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
8. 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, 2018, 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.
ANNEXURE âBâ TO THE INDEPENDENT AUDITORâS REPORT
Referred to in paragraph 11 of the Independent Auditorsâ Report of even date to the members of The Motor & General Finance Limited on the Standalone Ind AS financial statements as of and for the year ended 31st March, 2018
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.
(b) The fixed assets of the Company have been physically verified by the Management during the year. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account. In our opinion, the frequency of verification is reasonable.
(c) The title deeds of immovable properties, as disclosed in Note 3 on fixed assets to the financial statements, are held in the name of the Company.
ii. The physical verification of inventory comprising of stock in trade of commercial project has been conducted at reasonable intervals by the Management during the year. There were no discrepancies noticed on physical verification of inventory as compared to book records.
iii. According to the information and explanations given to us, the Company has granted unsecured loans to companies covered in the register maintained under Section 189 of the Act; and with respect to the same:
(a) in our opinion the terms and conditions of grant of such loans are not, prima facie, prejudicial to the Companyâs interest.
(b) The loan has been repaid during the year along with interest.
(c) as stated above loan has been repaid during the year, therefore there are no amount which is overdue for more than 90 days.
iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.
v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits during the year and had no unclaimed deposits at the beginning of the year within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products/ Services. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the records of the Company and information and explanations given to us and the records of the Company examined by us, the Company has been regular in depositing the undisputed statutory dues including provident fund, employees state insurance, income tax, Investor education and protection fund, goods and service tax, sales tax, service tax and other material statutory dues applicable to it with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of employees state insurance, Income Tax, goods and service tax, service tax, value added tax/ sales tax as at 31st March, 2018 which have not been deposited on account of a dispute are as follows:
|
Name of the Statute |
Nature of the Due |
Amount (Rs. In millions) |
Period to which the amount relates |
Forum where dispute is pending |
|
Finance Act |
Service Tax |
1,03,51,192/- |
2008-09 |
Commissioner of Service Tax |
|
Employees State Insurance Act |
Employees State Insurance |
74,75,606/- |
1989-90 to 2012-2013 |
Civil Court at Delhi |
|
NDMC Act |
Property Tax |
1,62,15,990/- |
1999-00 to 2016-17 |
Honâble High Court, Delhi |
|
DMC Act |
Property Tax |
96,23,152/- |
2004-05 to 2009-10 |
Honâble Municipal Taxation Tribunal |
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government. The company has not issued any debentures during the year.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments). Term loans have been applied for the purposes for which they were obtained.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
For JAGDISH CHAND & CO
Chartered Accountants
Firm Registration Number: 000129N
(Praveen Kumar Jain)
Place of signature: New Delhi Partner
Date: May 28, 2018 Membership Number: 85629
Mar 31, 2016
To the Members of
The Motor & General Finance Limited
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of The Motor & General Finance Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone 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, financial performance and cash flows of the company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs 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 disclosures in the standalone 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 accounting policies used and the reasonableness of the accounting estimates made by companyâs Directors, as well as evaluating the overall presentation of the standalone financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2016 and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs 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 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the company so far as it appears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of written representations received from the directors as on March 31, 2016, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016, from being appointed as a director in terms of Section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ; and
(g) 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 disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note no. 25 to the financial statements;
ii. The company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses; and
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
Annexure - A to the Independent Auditorâs Report
(Referred to in paragraph 1 under the heading âReport on Other Legal and Regulatory Requirementsâ of our report of even date)
i) (a) The company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) According to the information and explanations given to us physical verification of fixed assets is being conducted in a phased manner by the management under a programme designed to cover all the fixed assets over a period of three years, which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the company, the title deeds of immovable properties are held in the name of the company.
ii) According to the information and explanations given to us the inventories comprises of stock in trade of commercial project which have been physically verified by the management at reasonable intervals during the year. The discrepancies noticed on physical verification of inventories as compared to book records were not material and the same have been properly dealt with in the books of account.
iii) According to the information and explanations given to us and based on our examination of the documents and records, the company has granted unsecured loans to the companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013, in respect of such loans;
a) Terms and conditions of loans so granted are not, prima facie, prejudicial to the interest of the Company.
b) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of regularity in repayment of principal amount does not arise. However the interest is being paid regularly.
c) As stated above no repayment schedule have been specified, therefore there are no amount which is overdue for more than 90 days.
iv) In our opinion and according to information and explanations given to us, the Company has, in respect of loans, investments, guarantees, and security, complied with the provisions of section 185 and 186 of the Act.
v) The company has not accepted any deposits within the meaning of sections 73 to 76 of the Act. Therefore, the provisions of paragraph 3 (v) of the Order are not applicable to the Company under.
vi) The company has made and maintained cost accounts and records specified by the Central Government under section 148(1) of the Companies Act, 2013. However, we have not made a detailed examination of these accounts and records with a view to determine whether they are accurate or complete.
vii) (a) According to the information and explanations given to us and the records of the company examined by us, in our opinion, the company is generally regular in depositing undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, value added tax and other material statutory dues to the appropriate authorities and no undisputed amounts payable in respect of above were in arrears, as at March 31, 2016, for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, service tax, or value added tax which have not been deposited on account of any dispute except for the following:-
|
Name of the statute |
Nature of dues/Year |
Amount in Rs. |
Forum where dispute is pending |
|
Electricity Act |
Electricity charges (1993-94 & 2004) |
69,24,304 |
BSES Yamuna Power Ltd. |
|
Employee State Insurance Corporation Act, 1948 |
ESICâs Dues (1989-2010) |
74,75,606 |
ESIC Court |
|
Finance Act |
Service tax (2008-09) |
1,03,51,192 |
Commissioner of Service Tax |
viii) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of loans or borrowings to a financial institution, banks, and government. The company has not issued any debentures during the year.
ix) In our opinion and 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 (including debt instruments). The term loans raised were applied for the purposes for which they have been raised.
x) Based on our audit procedures and as per the information and explanations given by the management, we report that no fraud by the company or on the company, by its officers or employees, has been noticed or reported during the year.
xi) According to the information and explanations given to us and based on our examination of the books of account and other records of the company, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with the schedule V to the Act.
xii) According to the information and explanations given to us, the company is not a Nidhi company. Therefore, the provisions of Clause 3(xii) of the Order are not applicable to the company.
xiii) Based on our audit procedures and as per the information and explanations provided by the management, in our opinion, the company has entered into transactions with related parties in compliance with the provisions of section 177 and 188 of the Act, where applicable and the details of such transactions have been disclosed in the notes to the financial statements as required by the applicable accounting standards.
xiv) According to the information and explanations given to us and based on our examination of records, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Therefore, the provisions of clause 3(xiv) of the Order are not applicable to the company.
xv) According to the information and explanations given to us and based on our examination of documents and records, the company has not entered into any non-cash transactions with directors or persons connected with him. Therefore, the provisions of clause 3(xv) of the Order are not applicable to the company.
xvi) The company is not required to be registered under section 45-IA of Reserve Bank of India Act, 1934. Therefore, the provisions of clause 3(xvi) of the Order are not applicable to the company.
Annexure - B to the Independent Auditorâs Report
(Referred to in paragraph 2(h) under the heading âReport on Other Legal and Regulatory Requirementsâ of our report of even date)
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 The Motor & General Finance Limited (âthe Companyâ), as of March 31, 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 (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to 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 Act.
Auditorâs Responsibility
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, deemed to be prescribed under section 143(10) of the Act, 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 ICAI. 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 March 31, 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 ICAI.
For S. N. Dhawan & Co.
Chartered Accountants
Firmâs Registration. No.: 000050N
(N. C. Setia)
Place: New Delhi Partner
Date: May 28, 2016 Membership No. 012533
Mar 31, 2015
We have audited the accompanying financial statements of The Motor &
General Finance Limited ("the Company"), which comprise the Balance
Sheet as at March 31,2015, the Statement of Profit and Loss and Cash
Flow Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
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 financial statements that give a true and
fair view of the financial position, financial performance and cash
flows of the company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the act for safeguarding the assets of the company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by Company's Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the financial
statements
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the company as
at March 31,2015 and its loss and its cash flows for the year ended on
that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 3 and 4 of the Order,
to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purpose of our audit;
(b) In our opinion proper books of account as required by law have been
kept by the company so far as appears from our examination of those
books;
(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
(d) In our opinion, the aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of written representations received from the directors
as on March 31,2015, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31,2015, from being
appointed as a director in terms of Section 164 (2) of the Act; and
(f) With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i The company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note no. 26 of
the 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 were required to be transferred to the
Investor Education and Protection Fund by the company.
Annexure to Independent Auditor's Report
(The Annexure referred to in paragraph 1 of Report on Other Legal and
Regulatory Requirements of even date on the financial statements of The
Motor & General Finance Limited for the year ended March 31,2015)
i. (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) As per information and explanations given to us, fixed assets have
been physically verified by the management during the year and no
material discrepancies were noticed on such verification.
ii. (a) As explained to us physical verification of stock in trade
comprising of commercial project has been conducted by the management
at reasonable intervals. In our opinion the frequency of verifications
is reasonable.
(b) In our opinion the procedures of physical verification of stock in
trade comprising of commercial project followed by the management are
reasonable and adequate in relation to the size of the company and the
nature of its business.
(c) On the basis of our examination of the records of the stock in
trade comprising of commercial project, we are of the opinion that the
company is maintaining proper records. No material discrepancies were
noticed on verification between the physical record and book records.
iii. According to the information and explanations given to us, the
company has granted unsecured loans, to companies, firms or other
parties covered in the register maintained under Section 189 of the
Companies Act, 2013.
(a) According to the information and explanations given to us, no
repayment schedule has been specified and accordingly the question of
repayment of principal amount does not arise. However the interest is
being paid regularly.
(b) As stated above no repayment schedule have been specified and there
are no overdue amounts in excess of Rs. one lacs.
iv. In our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of stock in trade, fixed assets and sale of services. Further,
on the basis of our examination of the books and records of the
company, and according to the information and explanations given to us,
we have neither come across, nor have been informed of, any continuing
failure to correct major weaknesses in the aforesaid internal control
system
v. The company has not accepted any deposits within the meaning of
sections 73 to 76 of the Act. Therefore, the provisions of paragraph 3
(v) of the Order are not applicable to the company.
vi. The company has made and maintained cost accounts and records
specified by the Central Government under section 148(1) of the
Companies Act, 2013. However, we have not made a detailed examination
of these accounts and records with a view to determine whether they are
accurate or complete.
vii. (a) According to the information and explanations given to us and
on the basis of our examination of the records of the company, amounts
deducted/accrued in the books of accounts in respect of undisputed
statutory dues including income tax, provident fund, employees' state
insurance, sales tax, wealth tax, service tax and other material
statutory dues, as applicable to the company, have generally been
regularly deposited with the appropriate authorities. According to the
information and explanations given to us, no undisputed demand payable
in respect of aforesaid statutory dues were in arrears, as at 31st
March, 2015 for a period of more than six months from the date they
became payable.
(b) According to the information and explanations given to us there are
no dues of income tax, sales tax, wealth tax and service tax which have
not been deposited on account of any dispute, other than the
following:-
Name of the statute Nature of dues/Year Amount in Rs.
Electricity Act Electricity charges 6,924,304
(1993-94 & 2004)
Employee State ESIC's Dues 7,475,606
Insurance (1989-2010)
Corporation Act,1948
Finance Act Services tax (2008-09) 10,351,192
Name of the statute Forum where dispute is pending
Electricity Act BSES Yamuna Power Ltd.
Employee State ESIC Court
Insurance
Corporation Act,1948
Finance Act Commissioner of Service Tax
(c) According to the information and explanations given to us and the
records of the company examined by us, no amount required to be
transferred to investor education and protection fund in accordance
with the relevant provisions of the Companies Act, 1956 (1 of 1956) and
rules made there under.
viii. In our opinion, the accumulated losses of the company are not
more than 50% of its net worth. The company has not incurred any cash
loss during the financial year covered by our audit and in the
immediately preceding financial year.
ix. Based on our examination of the records and according to the
information and explanations given to us the company has not defaulted
in repayment of dues to financial institutions, banks or debenture
holders.
x. In our opinion and 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. Accordingly, the
provisions of paragraph 3(x) of the Order are not applicable to the
company.
xi. In our opinion and according to the information and explanations
given to us, and on overall examination of the Balance Sheet of the
company, we report that term loans have been applied for the purpose
for which they were obtained.
xii. In course of our examination of the books and records of the
company, carried out in accordance with the generally accepted auditing
practices in India, we have not come across any instance of fraud on or
by the company, and according to the information and explanations given
to us, no fraud was noticed or reported during the year by the
management.
For S. N. Dhawan & Co.
Chartered Accountants
Firm's Registration. No.: 000050N
(S. K. Khattar)
Place: New Delhi Partner
Date: May 29, 2015 Membership No. 084993
Mar 31, 2014
We have audited the accompanying financial statements of The Motor &
General Finance Limited ("the Company"), which comprise the Balance
Sheet as at March 31, 2014, and the Statement of Profit and Loss and
Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards notified under the Companies Act, 1956 ("the
Act") read with the General Circular 15/2013 dated 13th September, 2013
of the Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act, 2013. This responsibility includes the design,
implementation and maintenance of internal control relevant to the
preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due
to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by management, as well
as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our qualified audit opinion.
Basis for Qualified Opinion
Provision of Rs. 511.26 lacs has not been made for diminution in the
value of noncurrent long term investments. (Refer Note No. 26(iv)).
Had our aforesaid observation been considered, the profits for the year
would have been Rs. (184.75) lacs (as against the reported figure of
Rs. 326.51 lacs) and the deficit in statement of profit & loss would
have been Rs. 1904.46 Lacs (as against the reported figure of Rs.
1393.20Lacs).
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified Opinion paragraph, the financial
statements give the information required by the Act in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books and proper returns adequate for the purposes of our audit;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. except for the matter described in the Basis for Qualified Opinion
paragraph, in our opinion, the Balance Sheet, Statement of Profit and
Loss and Cash Flow Statement comply with the accounting standards
notified under the Companies Act, 1956 read with the General Circular
15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs
in respect of section 133 of the Companies Act, 2013;
e. On the basis of written representations received from the Directors,
as at March 31, 2014 and taken on record by the Board of Directors, we
report that none of the Directors is disqualified as at March 31, 2014
from being appointed as a Director under clause (g) of sub section (1)
of section 274 of the Companies Act, 1956.
Annexure to Independent Auditor''s Report
(Referred to in Paragraph 1 under the heading "Report on Other Legal
and Regulatory Requirements" of our report of even date on the accounts
of The Motor & General Finance Limited for the year ended March 31,
2014)
i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
b) As per information and explanations given to us, fixed assets have
been physically verified by the management during the year and no
material discrepancies were noticed on such verification.
c) According to the information and explanations given to us, the
Company has not disposed off a substantial part of its fixed assets
during the year.
ii) a) As explained to us physical verification of stock in trade
comprising of commercial project has been conducted by the management
at reasonable intervals. In our opinion the frequency of verifications
is reasonable.
b) In our opinion the procedures of physical verification of stock in
trade comprising of commercial project followed by the management are
reasonable and adequate in relation to the size of the Company and the
nature of its business.
c) On the basis of our examination of the records of the stock in trade
comprising of commercial project, we are of the opinion that the
Company is maintaining proper records. No material discrepancies were
noticed on verification between the physical record and book records.
(iii) (a) The Company has granted Inter Corporate Deposits to one
company covered in the register maintained under section 301 of the
Companies Act, 1956. The maximum amount involved during the year and
the year-end balance of such inter corporate deposit including interest
given to such party was Rs. 4211.21 lacs.
(b) In our opinion the rate of interest and other terms and conditions
on which Inter Corporate Deposits have been given, are prima facie not
prejudicial to the interest of the Company.
(c) According to the information and explanations given to us, no
repayment schedule has been specified and accordingly the question of
repayment of principal amount does not arise. However the interest is
being paid regularly.
(d) As stated above no repayment schedule have been specified and there
are no overdue amounts in excess of Rs. one lac.
(e) The Company has taken Inter Corporate Deposits from one company and
interest free advances from four companies covered in the register
maintained under section 301 of the Companies Act, 1956. The maximum
amount involved during the year and the year-end balance of such loans
and advances including interest was Rs. 5441.16 lacs.
(f) In our opinion, the other terms and conditions on which Inter
Corporate Deposits and interest free advances have been taken from
companies, firms or other parties listed in the register maintained
under section 301 of the Companies Act, 1956 are not, prima facie,
prejudicial to the interest of the company.
(g) The company is regular in repaying the principal amounts as
stipulated and has been regular in the payment of interest wherever
stipulated.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of the
business with regard to purchase of fixed assets, purchase and transfer
of stock in trade, sale of goods and services during the year. During
the course of our audit we have not come across any continuing failure
to correct major weaknesses in the internal control systems.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in Section 301 of the Companies Act, 1956 have been entered
in the register maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956 and exceeding the value of rupees five 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.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public
within the meaning of Section 58A and 58AA of the Companies Act, 1956
and the Companies (Acceptance of Deposits) Rules, 1975.
(vii) The Company has an internal audit system. However, functioning
thereof (including extent of coverage) needs to be strengthened to make
it commensurate with the size and nature of its business.
(viii) According to the information and explanations given to us, the
Central Government has not prescribed the maintenance of cost records
under Section 209(1) (d) of the Companies Act, 1956.
(ix) (a) According to the information and explanations given to us and
according to the records produced before us for our verification, the
Company is generally regular in depositing, with appropriate
authorities the undisputed statutory dues including Provident Fund,
Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth
Tax, Service Tax, Cess and any other material statutory dues applicable
to it.
(b) According to the information and explanations furnished to us, no
undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales
Tax, Service tax and Cess were in arrears as at March 31, 2014 for a
period of more than six months from the date they become payable.
(c) According to the information and explanations given to us, there
are no dues of Income Tax, Sales Tax, Wealth Tax, Service Tax and Cess
which have not been deposited on account of any dispute, other than the
following:-
Name of the statute Nature of dues Rs. Forum where dispute is
in Lacs pending
Electricity Act Electricity 69.24 BSES Yamuna Power Ltd.
charges
(1993-94 & 2004)
x) In our opinion, the accumulated losses of the Company are not more
than 50% of its net worth. The Company has not incurred any cash losses
during the financial year covered by our audit and in the immediately
preceding financial year.
xi) Based on our examination of the records and according to the
information and explanations given to us the Company has not defaulted
in repayment of dues to financial institutions, banks or debenture
holders.
xii) According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual
Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable.
xiv) In our opinion the Company is not dealing or trading in shares,
securities, debentures or other investments. Therefore, the provisions
of clause 4 (xiv) of the Order are not applicable.
xv) 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.
xvi) According to the information and explanations given to us, the
term loans availed by the Company were applied for the purposes for
which they were obtained.
xvii) According to the information and explanations given to us, and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investments.
xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956.
xix) The Company has not issued any debentures during the year.
xx) The Company has not raised any money through public issue during
the year.
xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the course of our audit.
For S. N. Dhawan & Co.,
Chartered Accountants
FRN-000050N
(S. K. Khattar)
Place: New Delhi Partner
Date : May 30, 2014 M. No.084993
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of The Motor &
General Finance Limited ("the Company"), which comprise the Balance
Sheet as at March 31, 2013, and the Statement of Profit and Loss and
Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of Section 211
of the Companies Act, 1956 ("the Act"). This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our qualified audit opinion.
Basis for Qualified Opinion
Provision of Rs 280.43 lacs has not been made for diminution in the
value of non current long term investments. (Refer Note No. 30). Had
our aforesaid observation been considered, the profits for the year
would have been Rs. 49.16 lacs (as against the reported figure of Rs.
329.58 lacs) and the deficit in statement of profit & loss would have
been Rs. 1944.05 Lacs (as against the reported figure of Rs.
1719.71Lacs).
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified Opinion paragraph, the financial
statements give the information required by the Act in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Emphasis of Matter
Without qualifying our opinion we draw attention:
There is non-compliance of the provisions of Non Banking Financial
Companies Prudential Norms (Reserve Bank) Directions 1998 with regard
to maintenance of Credit Concentration/Investment Norms in respect of
lending to one of the Company where these are exceeding the limits.
(Refer Note No.31)
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books and proper returns adequate for the purposes of our audit;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. except for the matter described in the Basis for Qualified Opinion
paragraph, in our opinion, the Balance Sheet, Statement of Profit and
Loss and Cash Flow Statement comply with the accounting standards
referred to in subsection (3C) of section 211 of the Act;
e. On the basis of written representations received from the
Directors, as at March 31, 2013 and taken on record by the Board of
Directors, we report that none of the Directors is disqualified as at
March 31, 2013 from being appointed as a Director under clause (g) of
sub section (1) of section 274 of the Companies Act, 1956.
f. Since the Central Government has not issued any notification as to
the rate at which the cess is to be paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
Annexure to Independent Auditor''s Report
(Referred to in Paragraph 1 under the heading "Report on Other Legal
and Regulatory Requirements" of our report of even date on the accounts
of The Motor & General Finance Limited for the year ended March 31,
2013)
i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets except for assets on lease.
(b) As per information and explanations given to us, fixed assets other
than lease assets have been physically verified by the management
during the year and no material discrepancies were noticed on such
verification. For Assets on Lease, confirmations from lessees, as
regards their physical existence, were not available.
(c) According to the information and explanations given to us, the
Company has not disposed off a substantial part of its fixed assets
during the year.
ii) The Company does not have any inventory. Therefore, the provisions
of clause 4 (ii) (a), (b) & (c) of the Order, are not applicable.
(iii) (a) The Company has granted Inter Corporate Deposits to one
company covered in the register maintained under section 301 of the
Companies Act, 1956. The maximum amount involved during the year and
the year-end balance of such inter corporate deposit given to such
party was Rs. 3459 lacs.
(b) In our opinion the rate of interest and other terms and conditions
on which Inter Corporate Deposits have been given, are prima facie not
prejudicial to the interest of the Company.
(c) According to the information and explanations given to us, no
repayment schedule has been specified and accordingly the question of
repayment of principal amount does not arise. However the interest is
being paid regularly.
(d) As stated above no repayment schedule have been specified and there
are no overdue amounts in excess of Rs. One lacs.
(e) The Company has taken Inter Corporate Deposits from one company and
interest free advances from two companies covered in the register
maintained under section 301 of the Companies Act, 1956. The maximum
amount involved during the year and the year-end balance of such loans
and advance taken were. Rs. 2250 lacs & 1677 lacs respectively.
(f) In our opinion, the other terms and conditions on which Inter
Corporate Deposits and interest free advances have been taken from
companies, firms or other parties listed in the register maintained
under section 301 of the Companies Act, 1956 are not, prima facie,
prejudicial to the interest of the company.
(g) The company is regular in repaying the principal amounts as
stipulated and has been regular in the payment of interest wherever
stipulated.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of the
business with regard to purchase of fixed assets. As explained, there
was neither purchase of inventories nor sale of goods and services
during the year. During the course of our audit we have not come across
any continuing failure to correct major weaknesses in the internal
control systems.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in Section 301 of the Companies Act, 1956 have been entered
in the register maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956 and exceeding the value of rupees five 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.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public
within the meaning of Section 58A and 58AA of the Companies Act, 1956
and the Companies (Acceptance of Deposits) Rules, 1975 read with Non
Banking Financial Companies Acceptance of Public Deposit (Reserve Bank)
Directions 1998.
(vii) The Company has an internal audit system. However, functioning
thereof (including extent of coverage) needs to be strengthened to make
it commensurate with the size and nature of its business.
(viii) According to the information and explanations given to us, the
Central Government has not prescribed the maintenance of cost records
under Section 209(1) (d) of the Companies Act, 1956.
ix) (a) According to the information and explanations given to us and
according to the records produced before us for our verification, the
Company is generally regular in depositing, with appropriate
authorities the undisputed statutory dues including Provident Fund,
Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth
Tax, Service Tax and any other material statutory dues applicable to
it.
(b) According to the information and explanations furnished to us, no
undisputed amounts payable in respect of Income Tax, Wealth Tax and
Sales Tax etc. were in arrears as at March 31, 2013 for a period of
more than six months from the date they become payable.
(c) According to the information and explanations given to us, there
are no dues of Income Tax, Sales Tax, Wealth Tax and Service Tax which
have not been deposited on account of any dispute, other than the
following:-
Name of the statute Nature of dues Rs. in Lacs Forum where
dispute is
pending
Sales Tax Act Transfer of
Right to use 4.82 Before U. P.
Tribunal,
Deputy
(1970-71 to
1995-96) Commissioner
and Assistant
Commissioner
Electricity Act Electricity
charges 69.92 BSES Yamuna
Power Ltd.
(1993-94 & 2004)
Delhi Municipal Interest on
Property Tax 47.52 Municipal
Taxation
Tribunal
Corporation Act.
x) In our opinion, the accumulated losses of the Company are not more
than 50% of its net worth. The Company has not incurred any cash losses
during the financial year covered by our audit and in the immediately
preceding financial year.
xi) Based on our examination of the records and according to the
information and explanations given to us the Company has not defaulted
in repayment of dues to financial institutions, banks or debenture
holders.
xii) According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual
Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable.
xiv) In our opinion the Company is not dealing or trading in shares,
securities, debentures or other investments. Therefore, the provisions
of clause 4 (xiv) of the Order are not applicable.
xv) 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.
xvi) According to the information and explanations given to us, the
term loans availed by the Company were applied for the purposes for
which they were obtained.
xvii) According to the information and explanations given to us, and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investments.
xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956.
xix) The Company has not issued any debentures during the year.
xx) The Company has not raised any money through public issue during
the year.
xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the course of our audit.
For S. N. Dhawan & Co.,
Chartered Accountants
FRN-000050N
(S. K. Khattar)
Place: New Delhi Partner
Date : May 30, 2013 M. No.84993
Mar 31, 2012
We have audited the attached Balance Sheet of The Motor & General
Finance Limited as at March 31, 2012, the Statement of Profit & Loss
and also the Cash Flow Statement for the year ended on that date,
annexed thereto. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audit.
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.
1. As required by the Companies (Auditors' Report) Order, 2003 (as
amended) issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Companies Act, 1956 we enclose
in the Annexure, a statement on the matters specified in paragraphs 4
and 5, of the said Order.
2. Attention is drawn to Note No. 29 regarding Inter-Corporate
Deposits given to Jayabharat Credit Limited in which directors are
interested, on the terms and conditions as stated therein.
3. Further to our comments in the Annexure referred to in paragraph 1
above, we report that :
i) Provision of Rs. 305.98 lacs has not been made for diminution in the
value of noncurrent long term permanent investments. (ReferNote No.30).
ii) There is non-compliance of the provisions of Non Banking Financial
Companies Prudential Norms (Reserve Bank) Directions 1998, with regard
to maintenance of Credit Concentration/Investment Norms in respect of
lending to one of the Company where these are exceeding the limits.
(Refer Note No.31)
4. We further report that :
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books.
c) The Balance Sheet, the Statement of Profit & Loss and the Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
d) In our opinion, the Balance Sheet, the Statement of Profit & Loss
and Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956 subject to our comments in our paragraphs 3 (i)
above.
e) On the basis of written representations received from the Directors,
as at March 31, 2012 and taken on record by the Board of Directors, we
report that none of the Directors is disqualified as at March 31, 2012
from being appointed as a Director under clause (g) of sub section (1)
of section 274 of the Companies Act, 1956.
We further report that, without considering the observation made in
paragraph 3 (ii) above the effect of which could not be determined, had
the observation made by us in paragraph 3 (i) above been considered,
the profits for the year would have been Rs. 647.09 lacs (as against
the reported figure of Rs. 953.07 lacs) and the deficit in statement of
profit & loss would have been Rs. 2289.35 Lacs (as against the reported
figure of Rs.1983.38 Lacs).
In our opinion and to the best of our information and according to the
explanations given to us, the said accounts read together with the
Significant Accounting Policies and Notes thereon give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
a. in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2012;
b. in the case of the Statement of Profit & Loss, the profit of the
Company for the year ended on that date; and
c. in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON
ACCOUNTS OF THE MOTOR &
GENERAL FINANCE LIMITED FOR THE YEAR ENDED MARCH 31, 2012
i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of
fixed assets except for assets on lease.
(b) As per information and explanations given to us, fixed assets other
than lease assets have been physically verified by the management
during the year and no material discrepancies were noticed on such
verification. For Assets on Lease, confirmations from lessees, as
regards theirphysical existence, were not available.
(c) According to the information and explanations given to us, the
Company has not disposed off a substantial part of its fixed assets
during the year.
ii) The Company does not have any inventory. Therefore, the provisions
of clause 4 (ii) (a), (b) & (c) of the Order, are not applicable.
iii) (a) The Company has granted Inter Corporate Deposits to one
company covered in the register maintained under section
301 of the Companies Act, 1956. The maximum amount involved during the
year and the year-end balance of such inter corporate deposit given to
such party was Rs. 2541.00 lacs.
(b) In our opinion the rate of interest and other terms and conditions
on which Inter Corporate Deposits have been given, are prima facie not
prejudicial to the interest of the Company.
(c) According to the information and explanations given to us, no
repayment schedule has been specified and accordingly the question of
repayment of principal amount does not arise. However the interest is
being paid regularly.
(d) The Company has taken Inter Corporate Deposits/Advances (including
interest free advances from two parties) from three companies covered
in the register maintained under section 301 of the Companies Act,
1956. The maximum amount involved during the year was Rs. 2012.00 lacs
and the year-end balance of loans taken from such parties was Rs.
1476.00 lacs.
(e) In our opinion, the other terms and conditions on which Inter
Corporate Deposits/Advances (including interest free advances) have
been taken from companies, firms or other parties listed in the
register maintained under section 301 of the Companies Act, 1956 are
not, prima facie, prejudicial to the interest of the company.
(f) The company is regular in repaying the principal amounts as
stipulated and has been regular in the payment of interest wherever
stipulated.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of the
business with regard to purchase of fixed assets. As explained, there
was neither purchase of inventories nor sale of goods and services
during the year. During the course of our audit we have not come across
any continuing failure to correct major weaknesses in the internal
control systems.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or
arrangements referred to in Section 301 of the Companies Act, 1956 have
been entered in the register maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956 and exceeding the value of rupees five 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.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public
within the meaning of Section 58A and 58AA of the Companies Act, 1956
and the Companies (Acceptance of Deposits) Rules, 1975 read with Non
Banking Financial Companies Acceptance of Public Deposit (Reserve Bank)
Directions, 1998.
(vii) The Company has an internal audit system. However, functioning
thereof (including extent of coverage) needs to be strengthened to make
it commensurate with the size and nature of its business.
(viii) According to the information and explanations given to us, the
Central Government has not prescribed the maintenance of cost records
under Section 209(1) (d) of the Companies Act, 1956.
ix) (a) According to the information and explanations given to us and
according to the records produced before us for our
verification, the Company is generally regular in depositing, with
appropriate authorities the undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Income Tax,
Sales Tax, Wealth Tax, Service Tax and any other material statutory
dues applicable to it.
(b) According to the information and explanations furnished to us, no
undisputed amounts payable in respect of Income Tax, Wealth Tax and
Sales Tax etc. were in arrears as at March 31, 2012 for a period of
more than six months from the date they become payable.
(c) According to the information and explanations given to us, there
are no dues of Income Tax, Sales Tax, Wealth Tax and Service Tax which
have not been deposited on account of any dispute, other than the
following:-
Name of the statute Nature of dues Rs. in Lacs Forum where dispute is
pending
Sales Tax Act Transfer of
Right to use 4.24 Before U. P.
Tribunal, Deputy
(1970-71 to
1995-96) Commissioner and
Assistant
Commissioner
Electricity Act Electricity
charges 69.24 BSES Yamuna Power Ltd.
(1993-94 &
2004)
x) In our opinion, the accumulated losses of the Company are not more
than 50% of its net worth. The Company has not incurred any cash losses
during the financial year covered by our audit and in the immediately
preceding financial year.
xi) Based on our examination of the records and according to the
information and explanations given to us the Company has not defaulted
in repayment of dues to financial institutions, banks or debenture
holders.
xii) According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual
Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable.
xiv) In our opinion the Company is not dealing or trading in shares,
securities, debentures or other investments. Therefore, the provisions
of clause 4 (xiv) of the Order are not applicable.
xv) 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.
xvi) According to the information and explanations given to us, the
term loans availed by the Company were applied for the purposes for
which they were obtained.
xvii) According to the information and explanations given to us, and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investments.
xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956.
xix) The Company has not issued any debentures during the year.
xx) The Company has not raised any money through public issue during
the year.
xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the course of our audit.
For S. N. Dhawan & Co.,
Chartered Accountants
Firm Reg. No.000050N
(S. K. Khattar)
Partner
M. No.84993
Place: New Delhi
Date : August 23, 2012
Mar 31, 2010
We have audited the attached Balance Sheet of The Motor & General
Finance Limited as at March 31, 2010, the Profit & Loss Account and
also the Cash Flow Statement for the year ended on that date, annexed
thereto. These financial statements are the responsibility of the
Companys management. Our responsibility is to express an opinion on
these financial statements based on our audit.
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.
1. As required by the Companies (Auditorsà Report) Order, 2003 (as
amended) issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Companies Act, 1956 we enclose
in the Annexure, a statement on the matters specified in paragraphs 4
and 5, of the said Order.
2. Further to our comments in the Annexure referred to in paragraph 1
above, we report that :
Provision of Rs.329.54 Lacs has not been made for diminution in the
value of long term permanent investments. (Refer note no.3).
3. We further 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, Profit & Loss Account and the Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956 subject to our comments in our paragraphs 2 above.
e) On the basis of written representations received from the Directors,
as on March 31, 2010 and taken on record by the Board of Directors, we
report that none of the Directors is disqualified as on March 31, 2010
from being appointed as a Director under clause (g) of sub section (1)
of section 274 of the Companies Act, 1956.
4. We further report that, subject to our comments in paragraphs 2
above the effect of which could not be determined, the profit for the
year would have been Rs. 984.60 lacs (against the reported figure of
Rs.1314.14 lacs) and the carry forward loss would have been Rs. 3537.99
lacs (against the reported figure of Rs. 3208.45 lacs).
In our opinion and to the best of our information and according to the
explanations given to us, the said accounts read together with the
Significant Accounting Policies and Notes on Accounts give the
information required by the Companies Act, 1956, in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
a. in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2010;
b. in the case of the Profit & Loss Account, of the profit of the
Company for the year ended on that date; and
c. in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON
ACCOUNTS OF THE MOTOR & GENERAL FINANCE LIMITED FOR THE YEAR ENDED
MARCH 31, 2010
i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets except for assets on lease.
(b) As per information and explanations given to us, the other fixed
assets have been physically verified by the management during the year.
In our opinion having regard to the size of the Company and the nature
of its business and the level of activities undertaken presently and,
keeping in view the type of assets involved, the frequency of
verification is reasonable. For Assets on Lease, confirmations from
lessees, as regards their physical existence, were not available.
(c) According to the information and explanations given to us, the
Company has not disposed off a substantial part of its fixed assets
during the year.
ii) The Company does not have any inventory. Therefore, the provisions
of clause 4 (ii) (a), (b) & (c) of the Order, are not applicable.
iii) (a) The Company has granted Inter Corporate Deposits to three
companies covered in the register maintained under Section 301 of the
Companies Act, 1956. The maximum amount involved during the year was
Rs.1406.75 Lacs and the year-end balance of loan given to such parties
was Rs.1145.56 Lacs.
(b) In our opinion the rate of interest and other terms and conditions
on which Inter Corporate Deposits have been given, are prima facie not
prejudicial to the interest of the Company.
(c) According to the information and explanations given to us, the
Inter Corporate Deposits are repayable on demand and during the year
the Company has not made any demand for repayment of the outstanding
amount. The repayment of interest is regular.
(d) The Company has taken Inter Corporate Deposits from three companies
covered in the register maintained under Section 301 of the Companies
Act, 1956. The maximum amount involved during the year was Rs.150 Lacs
and the year-end balance of loans taken from such parties was Rs.Nil.
(e) In our opinion, the rate of interest and other terms and conditions
on which loans have been taken from companies, firms or other parties
listed in the register maintained under Section 301 of the Companies
Act, 1956 are not, prima facie, prejudicial to the interest of the
company.
(f) The company is regular in repaying the principal amounts as
stipulated and has been regular in the payment of interest.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of the
business with regard to purchase of fixed assets. As explained, there
was neither purchase of inventories nor sale of goods and services
during the year. During the course of our audit we have not come across
any continuing failure to correct major weaknesses in the internal
control systems.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in Section 301 of the Companies Act 1956 have been entered
in the register maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, there are no transactions, exceeding the value of five
lacs rupees, that need to be entered into the register maintained under
Section 301 of the Companies Act 1956. Therefore, the provisions of
clause 4(v) (b) of the Order are not applicable.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public
within the meaning of Section 58A and 58AA of the Companies Act, 1956
and the Companies (Acceptance of Deposits) Rules, 1975 read with Non
Banking Financial Companies Acceptance of Public Deposit (Reserve Bank)
Directions 1998.
(vii) The Company has an internal audit system. However, functioning
thereof (including extent of coverage) needs to be strengthened to make
it commensurate with the size and nature of its business.
(viii) According to the information and explanations given to us, the
Central Government has not prescribed the maintenance of cost records
under Section 209(1) (d) of the Companies Act, 1956.
ix) (a) According to the information and explanations given to us and
according to the records produced before us for our verification, the
Company is generally regular in depositing, with appropriate
authorities the undisputed statutory dues including Provident Fund,
Investors Education and Protection Fund, Income Tax, Sales Tax, Wealth
Tax, Service Tax and any other material statutory dues applicable to
it. Further, since the Central Government has till date not prescribed
the amount of cess payable under Section 441A of the Companies Act,
1956, we are not in a position to comment upon the regularity or
otherwise of the Company in depositing the same.
(b) According to the information and explanations furnished to us, no
undisputed amounts payable in respect of Income Tax, Wealth Tax and
Sales Tax etc. were in arrears as at March 31, 2010 for a period of
more than six months from the date they become payable.
(c) According to the information and explanations given to us, there
are no dues of Income Tax, Sales Tax, Wealth Tax and Service Tax which
have not been deposited on account of any dispute, other than the
following:-
Name of the Nature of dues Rs. in Lacs Forum where
dispute is pending
statute
Sales Tax Act Transfer of Right to use 2.54 Before U. P. Tribunal,
Deputy
(1970-71 to 1995-96) Commissioner and
Assistant
Commissioner
Electricity
Act Electricity charges
(1993-94 69.24 BSES Yamuna Power Ltd.
& 2004)
x) In our opinion, the accumulated losses of the Company are not more
than 50% of its net worth. The Company has not incurred any cash losses
during the financial year covered by our audit and in the immediately
preceding financial year.
xi) Based on our examination of the records and according to the
information and explanations given to us the Company has not defaulted
in repayment of dues to financial institutions, banks or debenture
holders.
xii) According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
xiii) In our opinion, the Company is not a Chit Fund or Nidhi /Mutual
Benefit Fund/Society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable.
xiv) In our opinion the Company is not dealing or trading in shares,
securities, debentures or other investments. Therefore, the provisions
of clause 4 (xiv) of the Order are not applicable.
xv) 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.
xvi) According to the information and explanations given to us, the
Company has not taken any term loan. Therefore, provisions of clause 4
(xvi) of the Order are not applicable.
xvii) According to the information and explanations given to us, and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investments.
xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956.
xix) The Company has not issued any debentures during the year.
xx) The Company has not raised any money through public issue during
the year.
xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the course of our audit.
For S. N. Dhawan & Co.,
Chartered Accountants
Firm Reg. No.000050N
(S.K.Khattar)
Place: New Delhi Partner
Date : August 19, 2010 M. No.84993
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