ESSEM CATALYST LIMITED
ANNUAL REPORT 1999-2000
AUDITORS ' REPORT.
The Members of
ESSEM CATALYST LIMITED.
We have audited the attached Balance Sheet of ESSEM CATALYST LIMITED as at
31st March, 2000 and also the annexed Profit & Loss Account of the company
for the year ended on that date and report that:
1. As required by the Manufacturing and other companies (Auditors' Report)
order, 1988 issued by the Company Law Board in terms of section 227 (4A) of
the Companies Act, 1956, we enclose in the annexure, a statement on the
matters specified in para 4 and 5 of the said order.
2. Further to our comments in the annexure referred to in para 1, above we
(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 accounts as required by law have been
kept by the Company, so far as appears from our examination of those books;
(c) the Balance Sheet and Profit and Loss Account dealt with in the report
are in agreement with the books of account of the Company;
(d) in our opinion, this Profit & Loss account and the Balance Sheet comply
with the Accounting Standards specified by the Institute of Chartered
Accountants of India, referred to in Sub-Section (3C) of Section 211 of the
Companies Act 1956.
(e) reference is invited to "Notes to the Accounts" Note No.2 relating to
non transfer of factory shed and related shares in the name of the Company;
Note No.3(a) relating to the amount Rs.1,43,53,202/- which was recoverable
from a debtor on account of sale of shares in the year 94-95, and which
amount is written- off, but the proceedings before the arbitrators are
pending, Note No. 3(b) relating to sum payable to Union Bank of India, and
value of Stocks and Debtors, Note No.4 relating to securities not being in
the name of and not being available with the Company and provision for loss
on account of reduction in the value of those securities, Note No.5 for
gratuity liability not ascertained, Note No.6 for appointment of Court
Receiver for fixed assets and Note No.8 for non provision of recovery of
debtors and appointment of Court Receiver for Book debts & stock.
Subject to the above, in our opinion and to the best of our information and
according to the explanations given to us, the said accounts read with the
"Notes to the Accounts" give the information required by the Companies Act,
1956, in the manner so required and give a true and fair view:
(i) in so far as it relates to the Balance Sheet, of the state of affairs
of the Company as at 31st March, 2000 and
(ii) in so far as it relates to the Profit and Loss Account, of the loss of
the Company for the year ended on that date.
AS PER OUR REPORT OF EVEN DATE
C.D PASAD & CO.
Place : Mumbai,
Dated : 11th July, 2000.
Annexure referred to in para 1 of our report of even date to the members of
ESSEM CATALYST LIMITED for the year ended on 31st March, 2000.
1. The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets. As explained
to us physical verification of the fixed assets could not be conducted by
the management during the year as the fixed assets were in the possession
of the Court Receiver, appointed by the High Court, Mumbai.
2. None of the fixed assets have been revalued during the year.
3. We are informed that the manufacturing activity of the Company had
remained closed for the whole year. As the stock of Raw Material is pledged
with the bank and lies in their custody, management has not verified the
same stock of Raw Material.
4. In view again of the absence of physical verification, the question of
determination of reasonableness or adequacy of the procedure of
verification does not arise.
5. In view again of the absence of physical verification, the question of
any material discrepancies being noticed on such verification as compared
to book record does not arise.
6. At the year end Company did not hold any stock of Raw Material Finished
goods or stores, spares etc., the question of their valuation does not
arise. However, Stock of Raw Material lying with the bank is stated at Book
7. In our opinion, the rate of interest and the terms and conditions on
which loans have been obtained from the companies, firms or other parties
listed in the register maintained under section 301 of the Companies Act,
1956, are prima facie not prejudicial to the interest of the Company. As
informed to us, there are no Companies under the same management as defined
under section 370 (1B) of the Companies Act, 1956.
8. The Company has not granted any loan secured or unsecured to the
companies, firms or other parties listed in the register maintained under
section 301 of the Companies Act, 1956.
9. The Company has not given any loans and advances in the nature of loans
except to its employees.
10. Not applicable in view of the fact that the Company's manufacturing
activities has been discontinued.
11. During the year there are no purchases or sales exceeding Rs.50,000/-
from any party.
12. No provisions have been made in the accounts for unserviceable or
damaged stores, raw material and finished goods, as there were no
13. The Company has not accepted any Public deposits violation of Section
58-A of the Companies Act, 1956.
14. There being no production during the year, the question of maintaining
reasonable records for the sale or disposal of realisable by products and
scrap does not arise.
15. In our opinion, the Company has no formal internal audit system
commensurate with its size and nature of its business as Directors
themselves exercise the control.
16. The Central Government has not prescribed maintenance of cost records
under section 209 (1)(d) of the Companies Act 1956.
17. The Company has generally been regular in depositing Provident Fund
dues with the appropriate authorities and a informed to us, the Employees
State Insurance Scheme Act, 1948 is not applicable to the Company, except
that P.F. for the period after closure of the manufacturing activity not
paid to the authorities.
18. According to the information and explanations given to us there are no
undisputed amounts relating to Income-Tax, Wealth-Tax, Sales-Tax, Customs
Duty and Excise Duty payable as at 31st March, 2000 for a period exceeding
six months from the date they became applicable.
19. According to the information and explanations given to us and on the
basis of books and records of the Company examined by us, no personal
expenses of directors of employees have been charged to revenue account
other than those payable under contractual obligations or in accordance
with generally accepted business practices.
20. The Company is a sick industrial Company within the meaning of
Clause(o) of sub-section (1) of Section 3 of the Sick Industrial
Companies (Special Provisions) Act, 1985.
The Company has made an application for registration with the BIFR on 27th
July, 1999 and the Company was registered with BIFR on 16th August, 1999.
AS PER OUR REPORT OF EVEN DATE.
C. D PASAD & CO.
Place : Mumbai
Date : 11th July, 2000.