Mar 31, 2015
We have audited the accompanying financial statements of M/S STG
LIFECARE LIMITED (Formerly Known as Software Technology Group
International Limited) ("the company"), which comprise the Balance
Sheet as at 31 March 2015, the Statement of Profit and Loss, the Cash
Flow Statement for the period then ended, and a summary of significant
accounting policies and other explanatory information.
Management's Responsibility for (Standalone) 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 the
maintenance of adequate accounting records in accordance with the
provision of the Act for safeguarding of the assets of the Company and
for preventing and detecting the frauds and other irregularities;
selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of internal financial control, that were
operating effectively for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. 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 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 control
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 qualified audit opinion
Basis for Qualified Opinion
1. Note No. 4 in the financial statement which indicates that the
Company has accumulated losses of Rs. 35,50,48,911/- and its Net worth
has been substantially eroded, the Company has incurred a net loss of
Rs. 1,26,16,970/- during the current financial period and Rs.
1,26,07,664/- in the previous years and the Companies current
liabilities exceeded its current assets as at the balance sheet date.
These conditions, along with other matters set forth in the Notes to
the accounts, indicate the existence of a material uncertainty that
cast significant doubt about the Company's ability to continue as a
going concern. However as per the representation made by the management
they have received enquiries from the patients from India & abroad for
their medical treatment who would use the newly design Website of the
Company and are also getting excellent response from the hospitals to
associate with the company for patient referrals. But in our opinion
the income from this business is uncertain. The financial statements of
the Company has been prepared on a going concern basis for the reasons
stated in the said Note.
2. Note no. 13, the company has net deferred tax assets Rs.
14,18,07,674, as on 31st March, 2015. Since there was unabsorbed
depreciation & accumulated losses of Rs. 34,24,31,941/- as on
30.06.2014 and has also incurred losses of Rs. 1,26,16,970/- during the
period 01.07.2014 to 31.03.2015. Further, the management does not have
sufficient reasons supported by the convincing evidences that the
company will have sufficient taxable income in the future against which
the said deferred tax asset could be realised. Had the company
transferred the said deferred tax asset of Rs. 14,18,07,674/- to the
profit and loss account then the loss would have been higher by same
amount.
Qualified Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis For Qualified Opinion Paragraph, the aforesaid
financial statements, give the information required by the Act in the
manner so required and give a true and fair view in conformity with the
accounting principles generally accepted in India;
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2015;
b) in the case of the Statement of Profit and Loss, of the Loss for the
period ended on that date; and
c) in the case of the Cash Flow Statement, of the cash flows for the
period 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.
2. As required by section 143(3) of the Act, we report that :
a) We have sought and except for the possible effect of the matter
described in the Basis for Qualified Opinion above 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 except for the effect of the matters described in the
Basis for Qualified Opinion paragraph above 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 and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account.
d) In our opinion, except for the effect of the matters described in
the Basis for Qualified Opinion paragraph above 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) The matters described in Basis for Qualified opinion paragraph
above, may have an adverse effect on the functioning of the Company.
f) On the basis of written representations received from the directors
as on 31 March, 2015, taken on record by the Board of Directors, none
of the directors is disqualified as on 31 March, 2015, from being
appointed as a director in terms of Section 164(2) of the Act.
g) With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rule 2014, in our opinion and to the best of our information and
according to the explanations given to us :
i. As informed by the management, there was no litigations pending
against the company as on the date of its financial statements.
ii. The Company did not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
losses.
iii. There were no amounts which required to be transferred to the
Investor Education and Protection Fund.
ANNEXURE TO THE AUDITORS REPORT
Referred to in paragraph 1 under the heading "Report on other Legal and
Regulatory requirements" of our Report of even date to the members of
M/S STG LIFECARE LIMITED (Formerly Known as Software Technology Group
International Limited) on the accounts of the company for the year
ended 31st March, 2015 On the basis of such checks as we considered
appropriate and according to the information and explanations given to
us during the course of our audit, we report that:
(I) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets ;
(b) As explained to us, fixed assets have been physically verified by
the management at regular intervals; as informed to us no material
discrepancies were noticed on such verification;
(ii) a) The management has conducted physical verification of inventory
of books held as stock-in-trade at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
(iii) a) The Company has not granted any loans secured or unsecured to
companies firms or other parties covered in the register maintained
under section 189 of the companies Act, 2013.
b) The Company had taken unsecured loans from a Director covered in the
register maintained under section 189 of the companies Act., 2013. The
amount involved during the period was Rs. 53.11 Lacs and the period end
balance of loan taken from such Director was Rs. 428.46 Lacs.
c) The Loan taken by Company from its Directror's are interest free,
So, in our opinion the terms and conditions of loans taken by the
company are prima facie not prejudicial to the interest of the Company.
d) There are no stipulated terms of Payment thus the overdue amount
cannot be determined
(iv) In our opinion and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of fixed assets and for the sale of goods & 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, no major
weakness has not been noticed or reported.
(v) The Company has not accepted any deposits from the public covered
under Section 73 to 76 of the Companies Act, 2013 or the Companies
(Acceptance of Deposit) Rules 2014 or the directives issued by the
Reserve Bank of India apply.
(vi) As informed to us, the Central Government has not prescribed
maintenance of cost records under sub-section (1) of Section 148 of the
Act
(vii) a) According to the books and records as produced and examine by
us in accordance with generally accepted auditing practices in india
and also based on management representations, undisputed statutory dues
as on 31.03.2015 towards Income tax deducted at sources of Rs. 41.94
lacs, Provident Fund of Rs. 0.06 Lacs, Employees' State Insurance of
Rs. 7.04 Lacs, Service Tax of Rs. 147.84 Lacs have not been deposited
with the appropriate authorities.
b) According to the information and explanation given to us, there are
no dues of Sales Tax, Custom Duty, Excise duty, Wealth Tax, cess which
have not been deposited on account of any dispute except the following
Nature of Statute Nature of Dues Amount (Rs.)
Income Tax Act, 1961 Income Tax u/s 143 (3) 8,32,030/-
Income Tax Act, 1961 Income Tax demad 94,89,090/-
u/s 143(1) Asstt year 2010-11
Nature of Statute Forum where dispute is pending
Income Tax Act, 1961 CIT (Appeals )
Income Tax Act, 1961 Rectification
u/s154 of Income Tax Act. Filed.
(c) There has not been an occasion in case of the Company during the
period under report to transfer any sums to the Investor Education and
Protection Fund.
(viii) The Company has been registered for more than 5 years as on 31st
March, 2015 and its accumulated losses of Rs. 3550.49 Lacs at the end
of the financial period on 31st March, 2015. The Company has
accumulated losses more than 50% of its net worth as at 31.03.2015. The
company has also incurred cash losses of Rs. 67.73 Lacs during the
financial period 01.07.2014 to 31.03.2015 and also in the immediately
preceding financial year of Rs. 102.94 Lacs.
(ix) According to the records of the company examined by us and as per
the information and explanations given to us, the company has not
availed of any loans from any financial institution or banks and has
not issued debentures.
(x) In our opinion, and according to the information and explanations
given to us,the Company has not given any guarantee for loan taken by
others from a bank or financial institution during the period.
(xi) In our opinion, and according to the information and explanations
given to us, the company has not raised any term loans during the
period.
(xii) During the course of our examination of the books and records of
the company, carried in accordance with the auditing standards
generally accepted in India, we have neither come across any instance
of fraud on or by the Company noticed or reported during the course of
our audit nor have we been informed of any such instance by the
management.
For H.K. BATRA & Associates
Chartered Accountants
FRN:009889N
Place : New Delhi (H. K. BATRA)
Date : 16.05.2015 Partner
M. No:088790
Mar 31, 2012
1. We have audited the attached Balance Sheet of SOFTWARE TECHNOLOGY
GROUP INTERNATIONAL LIMITED (the "Company) as at 31st March, 2012, and
the Statement of Profit and Loss and Cash Flow Statement for the year
ended on that date annexed thereto, which we have signed under
reference to this report. 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.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003, as
amended by the Companies (Auditor's Report) (Amendment) Order, 2004
(together the "Order"), issued by the Central Government of India in
terms of sub-section (4A) of section 227 of 'The Companies Act, 1956'
of India (the 'Act') 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 a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Subject to balance confirmation and reconciliation of debtors,
creditors and other parties including loans and advances and some
inoperative bank accounts (See note 37- notes to financial statements)
and further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(i) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(ii) In our opinion, proper books of account as required by law have
been kept by the company so far as appears from our examination of
those books;
(iii) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts.
(iv) In our opinion, the Balance Sheet and Statement of Profit and 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 Act except Accounting Standard 22-Accounting for taxes on
income;
(v) On the basis of written representations received from the
directors, as on 31st March, 2012 and taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2012
from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Act;
(vi) Subject to balance confirmation and reconciliation of debtors,
creditors and other parties including loans and advances and some
inoperative bank accounts (Refer note 37- notes to financial
statements) and Accounting Standard 22-Accounting for taxes on income
(Refer note 13- notes to financial statements), in our opinion and to
the best of our information and according to the explanations given to
us, the said financial statements together with the notes thereon and
attached thereto give, in the prescribed manner, the information
required by the Act, and give a true and fair view in conformity with
the accounting principles generally accepted in India:
(a) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012;
(b) In the case of the Statement of Profit and Loss, of the Loss for
the year ended on that date; and
(c) In the case of the Cash Flow Statement, of the cash flows of the
company for year ended on that date.
ANNEXURE REFERED TO IN PARAGRAPH 3 OF AUDITORS' REPORT OF EVEN DATE TO
THE MEMBERS OF SOFTWARE TECHNOLOGY GROUP INTERNATIONAL LTD. ON THE
ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2012
Referred to in paragraph 3 of the Auditors' Report of even date to the
members of Software Technology Group International Limited on the
financial statements for the year ended 31st March, 2012
1. In respect of Fixed Assets:
a) The Company has maintained proper records to show full particulars,
including quantitative details and situation of its fixed assets on the
basis of available information.
b) As explained to us, fixed assets of the Company are physically
verified by the Management according to a phased program designed to
cover all the terms over a period of one year, which in our opinion is
reasonable having regard to the size of the Company and nature of its
assets. No material discrepancies were noticed on such verification.
c) In our opinion, the company has not disposed off substantial part of
the fixed assets during the year ended 31st March, 2012 and the going
concern status of the Company is not affected.
2. In respect of inventories:
a) According to the information and explanations given to us, the
management has physically verified the stocks of books within a
reasonable interval during the year ended on 31.03.2012.
b) In our opinion and according to the information and explanation
given, the procedure of physical verification of stock of books
followed by the management is reasonable and adequate in relation to
the size and the nature of its business.
c) The company has maintained proper records of stock of books. As
explained to us no material discrepancies were noticed on physical
verification of stock of books as compared with the records.
3. In respect of the loans secured or unsecured, granted or taken by
the company to/from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956:
a) The company has not granted any loan to other companies and other
parties covered in the register maintained under section 301 of the
Companies Act, 1956.
b) The company has taken unsecured loan from other companies and other
parties covered in the register maintained under section 301 of the
Companies Act, 1956 details are as follows:
S. Name of the party Closing balance Maximum Amount outstanding
No. (Rs) at any time during year
ended on 31.03.2012 (Rs)
1 Associated Tech
Plastic Pvt. Ltd. 76144291/- 76144291/-
2 Directors &
Relatives 46550195/- 49053195/-
c) In our opinion and according to the information and explanation, the
rate of interest and other terms and conditions of loans taken by the
company are not prima facie prejudicial to the interest of the company.
d) There are no stipulated terms of repayment thus the overdue amounts
cannot be determined.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business with regard to purchases of fixed assets and with regard to
the sale of services. Further during the course of our audit we have
neither come across nor have been informed of any instance of any
continuing major weaknesses in the internal control procedures.
5. In respect of the contracts or arrangements referred to in Section
301 of the Companies Act, 1956.
a) In our opinion and according to the information and explanations
given to us, the transactions in pursuance of contracts or arrangements
that need to be entered into the register maintained under section 301
of the Companies Act, 1956 have been so entered.
b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 and exceeding the value of rupees five lakhs in
respect of any party during the year ended on 31.03.2012 have been made
at prices which appear reasonable as per the information available with
the Company.
6. According to the information and explanation given to us, the
company has not accepted any deposit from Public. As such requirement
of compliance with the provisions of clause (vi) of the paragraph 4
regarding sections 58A and 58AA of the Companies Act 1956 and the rules
framed there under is not applicable.
7. In our opinion and according to the information and explanation
given, the company has an in house internal audit system commensurate
with the size and nature of its business.
8. According to the information and explanation given to us,
maintenance of cost records under section 209(1) (d) of the Companies
Act, 1956 have not been prescribed to the company by the Government of
India.
9. In respect of Statutory dues:
a) According to the books and records as produced and examined by us in
accordance with generally accepted auditing practices in India and also
based on Management representations, undisputed statutory dues as at
31.3.2012 towards Income Tax Deducted at Source of Rs. 35,69,166/-,
Provident Fund of Rs 28,06,674/-, ESI of Rs.6,80,900/- Service Tax of
Rs.1,45,01,823/- and Professional Ta x of Rs 95,863/-, have not been
regularly deposited with theappropriate authorities & there have been
serious delays in large number of cases.. We are informed that the
provisions of central excise act 1944 are not applicable to the
company.
b) According to information and explanation given to us, there are no
dues of wealth tax, sales tax, excise duty, custom duty, and cess,
which have not been deposited on account of any dispute, however a
Demand was raised by the Income Tax Department, which is under Appeal,
details are given below:-
Nature of Year to which Forum where dispute Amount (Rs)
the Dues amount relates is pending
(Assessment Year)
Income Tax 1998-99 I.T.A.T. (Appeal) 667931.00
Income Tax 2000-01 I.T.A.T. (Appeal) 1734728.00
Income Tax 2001-02 C.I.T. (Appeal) 911073.00
Total 3313732.00
10. In our opinion, company has accumulated losses more than 50% of its
net worth as at 31st March, 2012. The Company has incurred cash losses
during the current financial year. However, Company has not incurred
any cash loss in the immediately preceding financial period. In absence
of availability of confirmation/reconciliation of debtors & creditors
and other parties (refer note 37-notes to financial statements) we are
unable to assess its impact on financial statements.
11 . According to the records of the Company and on the basis of
verification and explanations given to us, it has not defaulted in
repayment of dues to a financial institution or bank or debenture
holders.
12. In our opinion and according to information and explanation given
to us, company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. In our opinion and according to information and explanation given
to us, the company is not a chit fund or a Nidhi/mutual benefit fund /
society. Therefore, the provisions of clause (xiii) of paragraph 4 of
the Companies (Auditor's Report) Order, 2003 are not applicable to the
company.
14. In our opinion and according to the information and explanations
given to us, the company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause (xiv) of paragraph 4 of the Companies (Auditor's
Report) Order, 2003 are not applicable to the company.
15. In our opinion and according to the information and explanations
given to us, the company has not given guarantees for loans taken by
others from banks or financial institutions.
16. In our opinion and according to the information and explanations
given to us and on an overall examination of the balance sheet of the
company, term loans have been applied for the purpose for which they
were raised.
17. In our opinion and according to the information and explanations
given to us and on an overall examination of the balance sheet of the
company, we report that no funds raised on short-term basis have been
used for long-term assets except permanent working capital.
18. In our opinion and 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.
19. In our opinion and according to the information and explanations
given to us, the Company has not issued any secured / unsecured
debentures during the year ended on 31.03.2012.
20. In our opinion and according to the information and explanations
given to us, the Company has not raised any money by public issue
during the year ended on 31.03.2012.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the Management.
For BAWEJA & KAUL
Chartered Accountants
FRN: 005834N
Dalip K Kaul
Place : Gurgaon Partner
Date : 30.05.2012 M. No. 083066
Mar 31, 2011
1. We have audited the attached Balance Sheet of SOFTWARE TECHNOLOGY
GROUP INTERNATIONAL LIMITED., as at 31st MARCH, 2011, and also the
Profit and Loss Account and the Cash Flow Statement for the Eighteen
months period from 1st October, 2009 to 31st March 2011, 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.
2. 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.
3. As required by the Companies (Auditors Report) Order, 2003 as
amended by the Companies (Auditors Report) (Amendment) Order 2004,
issued by the Central Government of India in terms of sub-section (4A)
of section 227 of the Companies Act, 1956, and on the basis of such
checks of the books and the records of the Company as we considered
appropriate and according to the information and explanation given to
us, we enclose in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
4. Subject to balance confirmation and reconciliation of debtors,
creditors and other parties including loans and advances and some
inoperative bank accounts (See note 1(c) of schedule 22 - notes forming
part of the accounts) and further to our comments in the Annexure
referred to in paragraph 3 above, we report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit.
(ii) In our opinion, proper books of account as required by law have
been kept by the company, so far as appears from our examination of
those books.
(iii) The Balance Sheet, Profit and Loss Account and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts.
(iv) In our opinion, the Balance Sheet and Profit and Loss Account
dealt with by this report comply with the accounting standards referred
to in sub - section (3C) of section 211 of the Companies Act, 1956.
(v) On the basis of written representation received from the directors,
as on 31st March, 2011 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March,
2011 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956;
(vi) Subject to balance confirmation and reconciliation of debtors,
creditors and other parties including loans and advances and some
inoperative bank accounts (See note 1(c) of schedule 22 - notes forming
part of the accounts), in our opinion and to the best of our
information and according to the explanations given to us, the said
accounts read in conjunction with schedules 1 to 22, 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 31st March, 2011;
(b) In the case of the Profit and Loss Account, of the Profit for the
eighteen months period ended on that date; and
(c) In the case of the Cash Flow Statement, of the cash flows of the
company for the eighteen months period ended on that date.
ANNEXURE REFERED TO IN PARAGRAPH 3 OF AUDITORS REPORT OF EVEN DATE TO
THE MEMBERS OF SOFTWARE TECHNOLOGY GROUP INTERNATIONAL LTD. ON THE
ACCOUNTS FOR THE EIGHTEEN MONTHS PERIOD ENDED MARCH 31, 2011
1. In respect of Fixed Assets:
a) The Company has maintained proper records to show full particulars,
including quantitative details and situation of its fixed assets on the
basis of available information.
b) As explained to us, fixed assets of the Company are physically
verified by the Management according to a phased program designed to
cover all the terms over a period of one year, which in our opinion is
reasonable having regard to the size of the Company and nature of its
assets. No material discrepancies were noticed on such verification.
c) In our opinion, the company has not disposed off substantial part of
the fixed assets during the Eighteen months period ended on 31.03.2011
and the going concern status of the Company is not affected.
2. In respect of inventories:
a) According to the information and explanations given to us, the
management has physically verified the stocks of books within a
reasonable interval during the Eighteen months period ended on
31.03.2011.
b) In our opinion and according to the information and explanation
given, the procedure of physical verification of stock of books
followed by the management is reasonable and adequate in relation to
the size and the nature of its business.
c) The company has maintained proper records of stock of books. As
explained to us no material discrepancies were noticed on physical
verification of stock of books as compared with the records.
3. In respect of the loans secured or unsecured, granted or taken by
the company to/from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956:
a) The company has not granted any loan to other companies and other
parties covered in the register maintained under section 301 of the
Companies Act, 1956.
b) The company has taken unsecured loan from other companies and other
parties covered in the register maintained under section 301 of the
Companies Act, 1956 details are as follows:
S.
NO. PARTY NAME CLOSING Maximum Amount
BALANCE outstanding at any
time during the
Eighteen months
period ended on
31.03.2011.
1 Associated Tech
Plastic Pvt. Ltd. 55673379.00 1089048.00
2 Directors 46806195.13 40945720.00
c) In our opinion and according to the information and explanation, the
rate of interest and other terms and conditions of loans taken by the
company are not prima facie prejudicial to the interest of the company.
d) There are no stipulated terms of repayment thus the overdue amounts
cannot be determined.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business with regard to purchases of fixed assets and with regard to
the sale of services. Further during the course of our audit we have
neither come across nor have been informed of any instance of any
continuing major weaknesses in the internal control procedures.
5. In respect of the contracts or arrangements referred to in Section
301 of the Companies Act, 1956.
a) In our opinion and according to the information and explanations
given to us, the transactions in pursuance of contracts or arrangements
that need to be entered into the register maintained under section 301
of the Companies Act, 1956 have been so entered.
b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 and exceeding the value of rupees five lakhs in
respect of any party during the Eighteen months period ended on
31.03.2011 have been made at prices which appear reasonable as per the
information available with the Company.
6. According to the information and explanation given to us, the
company has not accepted any deposit from Public. As such requirement
of compliance with the provisions of clause (vi) of the paragraph 4
regarding sections 58A and 58AA of the Companies Act 1956 and the rules
framed there under is not applicable.
7. In our opinion and according to the information and explanation
given, the company has an in house internal audit system commensurate
with the size and nature of its business.
8. According to the information and explanation given to us,
maintenance of cost records under section 209(1) (d) of the Companies
Act, 1956 have not been prescribed to the company by the Government of
India.
9. In respect of Statutory dues:
a) According to the books and records as produced and examined by us in
accordance with generally accepted auditing practices in India and also
based on Management representations, undisputed statutory dues as at
31.3.2011towards Income Tax Deducted at Source of Rs. 40,73,489/-,
Provident Fund of Rs 56,93,900/-, ESI of Rs.6,30,777/- Service Tax of
Rs.1,29,05,259/- and Professional Tax of Rs 94,663/-, furthermore,
during the Eighteen months period ended on 31.03.2011, no Statutory
dues have been deposited. We are informed that the provisions of
central excise act 1944 are not applicable to the company.
b) According to information and explanation given to us, there are no
dues of wealth tax, sales tax, excise duty, custom duty, and cess,
which have not been deposited on account of any dispute, however a
Demand was raised by the Income Tax Department, which is under Appeal,
details are given below:-
Nature of Amount Year to which Forum where
the Dues (Rs) amount relates dispute
(Assessment Year) is pending
Income Tax 667931.00 1998-99 I.T.A.T. (Appeal)
Income Tax 1734728.00 2000-01 I.T.A.T. (Appeal)
Income Tax 911073.00 2001-02 C.I.T. (Appeal)
Total 3313732.00
10. In our opinion, company has accumulated losses more than 50% of
its net worth as at 31st March, 2011 however, the Company has not
incurred any cash loss either during the Eighteen months period ended
on that date or in the immediately preceding financial year.
11. According to the records of the Company and on the basis of
verification and explanations given to us, it has repaid cash credit
facility obtained from the Jammu & Kashmir Bank. The company has not
issued any debentures during the period.
12. In our opinion and according to information and explanation given
to us, company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. In our opinion and according to information and explanation given
to us, the company is not a chit fund or a Nidhi/mutual benefit fund /
society. Therefore, the provisions of clause (xiii) of paragraph 4 of
the Companies (Auditors Report) Order, 2003 are not applicable to the
company.
14. In our opinion and according to the information and explanations
given to us, the company is not dealing in or trading in shares,
securities debentures and other investments. Accordingly, the
provisions of clause (xiv) of paragraph 4 of the Companies (Auditors
Report) Order, 2003 are not applicable to the company.
15. In our opinion and according to the information and explanations
given to us, the company has not given guarantees for loans taken by
others from banks or financial institutions.
16. In our opinion and according to the information and explanations
given to us and on an overall examination of the balance sheet of the
company, term loans have been applied for the purpose for which they
were raised.
17. In our opinion and according to the information and explanations
given to us and on an overall examination of the balance sheet of the
company, we report that no funds raised on short-term basis have been
used for long-term assets except permanent working capital.
18. In our opinion and 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.
19. In our opinion and according to the information and explanations
given to us, the Company has not issued any secured / unsecured
debentures during the Eighteen months period ended on 31.03.2011.
20. In our opinion and according to the information and explanations
given to us, the Company has not raised any money by public issue
during the Eighteen months period ended on 31.03.2011.
21. In our opinion and according to the information and explanations
given to us, no material fraud on or by the company has been noticed or
reported during Eighteen months period ended on 31.03.2011.
BAWEJA AND KAUL
Chartered Accountants
FRN:005834N
Samvit K Gurtoo
Partner
M. No. 090758
Place : New Delhi
Date : 28-05-2011
Sep 30, 2009
1. We have audited the attached Balance Sheet of M/S SOFTWARE
TECHNOLOGY GROUP INTERNATIONAL LTD. as at September 30, 2009, the
Profit and Loss Account for the year ended on that date annexed thereto
and the Cash Flow Statement for the year ended on that date. These
financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We 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 from material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 issued
by the Department Of Company Affairs, Government of India in terms of
sub-section (4A) of Section 227 of the Companies Act, 1956, and on the
basis of such checks as we considered appropriate and according to
information and explanation given to us, we annex hereto a statement on
the matters specified in paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in Paragraph
(03) above, we report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
Audit;
(ii) In our opinion, proper Books of Accounts as required by law have
been kept by the company, so far as appears from our examination of
those books;
(iii) The Balance Sheet and Profit and Loss Account and Cash Flow
Statement of the Company referred to in this report are in agreement
with the books of accounts;
(iv) In our opinion, the Balance Sheet and Profit and Loss Account and
Cash Flow Statement referred to in this report comply with the
accounting standards referred to in sub section (3C) of Section 211 of
the Companies Act,1956;
(v) On the basis of written representations received from the directors
as on 30th September 2009, we report that none of the directors is
disqualified as on 30th September 2009 from being appointed as director
in terms of clause (g) of sub-section (1) of Section 274 of Companies
Act, 1956;
(vi) No comments are offered on clause (g) of the section 227(3) of the
Companies Act, 1956, since the Central Government has not yet published
any notification in the official Gazette for levy and collection of
cess under section 441 (A) of the Companies Act, 1956;
(vii) Subject to above in our opinion and to the best of our
information and according to the explanations given to us, the said
Balance Sheet, Profit and Loss Account and Cash Flow Statement read
together with significant accounting policies and Notes forming part of
Account thereon given in Schedule No. 21 and 22 respectively, gives 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 30th September 2009;
(b) In the case of the Profit and Loss Account, of the Loss for the
year ended on that date; and.
(c) In the case of the Cash Flow Statement, of the Cash flows of the
company for the year ended on that date.
ANNEXURE TO THE AUDITORS REPORT OF SOFTWARE TECHNOLOGY GROUP
INTERNATIONAL LTD FOR THE YEAR ENDED 30th September 2009 (Referred to
in paragraph (03) of our report of even date)
1 a) The company has maintained proper records showing correct
bifurcation, full particulars, including quantitative details and
situations of its fixed assets.
b) According to information and explanation given to us, the management
has physically verified the fixed assets of the company at reasonable
interval during the year and no material discrepancies are stated to
have been noticed on such verifications as compared to book records. In
our opinion, the frequency of physical verification is reasonable
having regard to the size of the Company and the nature of the asset.
c) Substantial part of fixed assets has not been disposed off during
the year.
2 a) According to the information and explanations given to us,
the management has physically verified the stocks of books at
reasonable interval during the year.
b) In our opinion and according to the information and explanations
given to us, the procedure of the physical verification of stocks of
books followed by the management are reasonable and adequate in
relation to the size and nature of its business.
c) The company is maintaining proper records of stock of books. As
explained to us, no significant discrepancy was noticed on physical
verification of stocks of books as compared with book records and was
properly dealt with in the books of account.
3 a) The company has not granted any loan secured or unsecured
to the companies and other parties required to be listed in the
register maintained under Section 301 of the Companies Act, 1956, hence
clause (b), (c), (d) are not applicable.
e) The company has taken unsecured loan from the companies and other
parties required to be listed in the register maintained under Section
301 of the Companies Act, 1956, details are given below:-
s. PARTY NAME CLOSING LOAN BALANCE DURING
No. TAKEN NO. THE YEAR(In Rs.)
1. A.T.P. Pvt. Ltd. 5,45,86,331.00 82,75,000.00
2. Director 2,91,27,975.46 50,00,000.00
f) As explained to us, the terms and conditions of such loans are not
prima facie prejudicial to the interest of the Company.
g) Since terms of repayment have not been stipulated, overdue amount
cannot be calculated.
4. In our opinion and according to the information and explanation
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business, for the purchase of Books, Courseware and fixed Assets and
for sale of books and courseware. No major weakness in internal control
system has been noticed by us during the course of audit.
5. a) According to information and explanation given to us, we
are of opinion that the transactions that need to be entered into the
register maintained under section 301 of the companies Act, 1956 have
been so entered.
b) During the year the company has taken/given some types of services
in pursuance of contract or arrangement required to be entered in the
Registermaintained under section 301 of Companies Act 1956, since
these services are technical in nature, based on the confirmation
received from the technical head of the company in this regard we are
of the opinion that pricing for these transactions have been made at
the prices which are reasonable having regard to the prevailing market
prices of such transactions at the relevant time.
6. The company has not accepted any deposits from public within the
meaning of the directives issued by the Reserve Bank of India and the
provisions of Section 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposits) Rules, 1975.
7. The Company has an in-house internal Audit system. Internal Audit
has been done on continuous basis and no serious objection has come to
our notice as per the Internal Audit Report.
8. The central government has not prescribed for the maintenance of
Cost records under clause (d) of sub section (1) of section 209 of
Companies Act 1956.Therefore the provision of clause 4(viii) of the
Companies (Auditors Report) Order, 2003 is not applicable to the
company.
9. a) According to the records of the company, there were arrears
of undisputed statutory dues as at 30th September 2009 towards Income
Tax Deducted at Source of Rs. 18,38,011/-, Provident Fund of Rs
58,03,078/-, ESI of Rs.5, 24,240 Service Tax of Rs 98,22,089/- and
Fringe Benefit Tax of Rs 7,46,713/-, furthermore, during the year
Statutory dues have been deposited late.
However, the Income Tax Deducted at Source has subsequently been
deposited.
b) According to information and explanation given to us, there are no
dues of wealth tax, sales tax, excise duty, custom duty, and cess,
which have not been deposited on account of any dispute, however a
Demand was raised by the Income Tax Department, which is under Appeal,
details are given below:-
Nature of Amount Year to which Forum where
the Dues (Rs) amount relates dispute is pending
(Assessment Year)
Income Tax 6,67,931/- 1998-99 I.T.A.T. (Appeal)
Income Tax 17,34,728/- 2000-01 I.T.A.T. (Appeal)
Income TAx 9,11,073/- 2001-02 C.I.T. (Appeal)
Total 33,13,732/-
10. In our opinion, accumulated losses of the company are more than
50% of its net worth. The company has not incurred cash losses in the
financial year under report however in the immediately preceding
financial year the company had incurred losses.
11. On the basis of verification of records and information &
explanations given to us, the company has defaulted in repayment of
cash credit facility obtained from Jammu and Kashmir Bank amounting to
Rs. 2,28,64,854/- including interest of Rs. 41,89,497/-. The company
has not issued any debentures during the year.
12. The company has not granted Loans & Advances on the basis of
security by way of pledge of Shares, Debentures or any Securities.
13. The company is not a chit fund, nidhi or mutual benefit fund/
society. Therefore the provisions of clause 4(xiii) of the Companies
(Auditors Report) Order, 2003 are not applicable to the company.
14. The company has not dealt or traded in shares, securities,
debentures and other investments during the year. However it has
maintained proper records in respect of shares held as long- term
investments and same are held in the name of company.
15. According to the information and explanation given to us, the
company has not given any guarantee for loan taken by others from Bank
or financial Institutions.
16. The company has neither raised any fresh term loan during the year
nor any unutilized amount was left on this account, as at the beginning
of the year.
17. According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the company, we report
that the funds raised on short-term basis have not been used for
long-term investment and vice-versa.
18. During the year 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. Therefore the provisions
of clause 4(xviii) of the Companies (Auditors Report) Order, 2003 are
not applicable to the company.
19. The company has not issued any debentures, therefore the provision
of clause 4(xix) of the Companies (Auditors Report) Order, 2003 is not
applicable to the company.
20. The company has not raised any money by way of public issue during
the year.
21. No case of fraud on or by the company has been noticed or reported
during the year.
For Jain Singhal & Associates
Chartered Accountants
(Pradeep Beri)
Place: New Delhi Partner
Date: 30-12-2009 M. No.: 82392
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