K.J. INTERNATIONAL LIMITED
ANNUAL REPORT 2008-2009
The Members of
K.J. INTERNATIONAL LIMITED
1. We have audited the attached Balance Sheet of M/s. K.J. International
Limited, New Delhi, as at March 31, 2009 and also the Profit and Loss
Account for the year ended on that date annexed thereto. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based
on our audit.
2. We have 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 (Auditor's Report) order, 2003, issued by
the Central Government of India in terms of sub-section (4A) of Section 227
of the Companies Act, 1956, (`the Act'), we enclose in the Annexure a
statement on the mattes specified in paragraphs 4 and 5 of the said order.
4. Further to our comments in the Annexure referred to above, we report
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 and loss account dealt with by this report are
in agreement with the books of account;
d. In our opinion, the balance sheet, 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 Act; subject to Regarding non compliance of AS-6
& AS-10 related to Depreciation Accounting & Accounting of Fixed Assets
respectively i.e profit/ loss on sale of building and plant & machinery is
not recognized due to non availability of cost of asset disposed .
e. On the basis of the written representations received from the directors,
as on March 31, 2009 and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on March 31, 2009 from
being appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Act;
f. In our opinion and to the best of our information and according to the
explanations given to us, the said accounts 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.
i. in the case of the balance sheet, of the state of affairs of the Company
as at March 31, 2009;
ii. in the case of the profit and loss account, of the loss for the year
ended on that date;
iii. in the case of cash flow statement , of the cash flows for the year
ended on that date.
For L.N. MALIK & CO.
PLACE : NEW DELHI
DATE : 21st August, 2009
Annexure to the auditors' Report - March 31, 2009
(Referred to in paragraph 3 of our report of even date)
(i) (a) The Company maintaining proper records showing full particulars
including quantitative details and situation of fixed assets.
(b) The Company physically verifies the fixed assets on a rotational basis
and accordingly, certain fixed assets have been physically verified by the
management during the year and no material discrepancies were noticed on
(c) There was no substantial disposal of fixed assets during the year.
(ii) (a) The company does not have any inventory. Hence clauses (a) (b) and
(c) are not applicable to the company
(iii) The Company has taken & granted loan or advances in the nature of
loans to parties covered in the register maintained under section 301 of
the Act. The company has taken loan from 4 directors , the closing balance
of the same as on 31.3.2009 was Rs 87.42 lacs. The company has granted loan
to the partnership firm M/s K J International, the closing balance of the
same was Rs. 442.18 lacs as on 31.03.2009. No interest has been charged and
paid on the amount of above loans.
(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 its business for the purchase of
inventory and fixed assets and for the sale of goods and services. During
the course of our audit, no major weakness has been noticed in the internal
(v) Based on the audit procedures applied by us and the information and
explanations provided by the management, we are of the opinion that there
were no contracts or arrangements during the year that need to be entered
in the register maintained under section 301 of the companies Act, 1956.
(vi) The Company has not accepted any deposits from the public to which the
directives issued by the Reserve Bank of India and the provisions of
section 58A of the Act and the rules framed there under apply.
(vii) In our opinion, the company has an internal audit system commensurate
with the size and nature of its business.
(viii) We are informed that the Central Government has not prescribed
maintenance of cost records under clause (d) of sub-section (I) of section
209 of the Act for the products of the Company.
(ix) (a) Undisputed statutory dues including provident fund, investor
education and protection fund, or employees' state insurance, income tax,
sales tax, wealth tax, service tax, customs duty, excise duty, cess have
been regularly deposited by the Company with appropriate authorities in all
cases during the year. According to the information and explanations given
to us, no undisputed amounts payable in respect of income tax, wealth tax,
sales tax, customs duty and excise duty were outstanding. at the year end
for a period of more than six months from the date they became payable.
(b) According to the records of the company, there are no dues of Income-
tax, Sales tax, Wealth tax, Service Tax. Customs duty, Excise duty and Cess
which have not been deposited on accounts of any dispute.
(x) The accumulated losses of the company have exceeded Fifty percent of
its net worth as at 31st March, 2009. The company has not incurred cash
losses during the financial year covered by our Audit and not in the
immediately preceding financial year. In arriving at the accumulated losses
and the net worth we have considered the qualifications which are
quantifiable in the Audit report of the year to which these losses pertain.
(xi) During the year, the company has not defaulted in repayment of dues to
banks and financial institutions. However during the year, the deed of
Assignment was executed on 10th June 2008 between the Consortium Bankers,
Kotak Mahindra Bank and the Company regarding the buyout of Consortium debt
owned by K J International Ltd. Similarly the deed of assignment was also
executed on 13th June 2008 between the Stressed Assets Stabilization Fund
(IDBI), Kotak Mahindra Bank Ltd and the Company regarding the acquiring the
debts of IDBI owned by the Company.
As per the draft term sheet, the company has provided interest on above
loans @25% p.a.
(xii) The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
(xiii) The nature off activities of the Company does not attract any
special statute applicable to chit fund and nidhi/mutual benefit
(xiv) The company does not deal or trade in shares, securities, debentures
and other investments.
(xv) According to the information and explanations given to us. the Company
has not given guarantee for a loan taken by a third party from a bank or
(xvi) According to the records of the company, the Company lead obtained
terms loans during the year. Please refer point (xi) above.
(xviii) According to the information and explanations given to us and on
overall examination of the balance, sheet of the Company as at March 31,
2009, we report that no funds raised on short term basis have been used for
(xviii) The company has not made any preferential allotment of shares to
parties or companies covered in the register maintained under section 301
of the Act.
(xix) According to the records of the company, the Company has not issued
(xx) The Company has not raised any money through a public issue during the
(xxi) According to the information and explanations given by the
management, we report that no fraud on or by the Company has been noticed
or reported during the year.
For L.N. Malik & Co.
Place : New Delhi (L.N. Malik)
Dated : 21st August, 2009 Partner
Membership No. 10423