NATIONAL SWITCHGEARS LIMITED
ANNUAL REPORT 2001-2002
THE AUDITORS' REPORT TO THE MEMBERS OF NATIONAL SWITCHGEARS LIMITED
We have audited the annexed Balance Sheet of M/s National Switchgears
Limited as on 31st March 2002- and the Profit & Loss Account for the year
ended on that date and reports that
1. 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.
2. In our opinion, proper books of accounts have been kept by the Company
as required by law. so tar as it appears from our examination of these
books. The Balance Sheet and Profit & Loss Account referred to in this
report are in agreement with the Books of Accounts.
3. In our opinion, the Balance Sheet and Profit & Loss Account comply with
the requirements of the mandatory accounting standards referred to Sub-
section (3C) of section 211 of the Companies Act, 1956, to the extent
4. On the basis of information obtained, none of the Directors of the
Company are prima facie disqualified under Section 274(1)(g) of the
Companies Act, 1956 as on 31st March, 2002 from being appointed as
5. Attention of the members is drawn to the following
5.1 Operations of the Company have been discontinued including
discontinuance of services of employees, excepting a few security staff.
Accordingly, as stated in par a A-1 and B-2 of Schedule XII, the accounts
of the Company have been prepared on the basis of discontinuance of
operations i.e. not on Going Concern Basis.
5.2. The security personnel have filed a suit against the company for their
regularisation as employees of the company. Since the matter is subjudice,
no liability has been determined and considered in accounts. No amount has
been considered as contingent liability even.
5.3 Par a A(3) of Schedule XII relating to revaluation of assets in
accordance to the Accounting Standard 24 of the Institute of Chartered
Accountants of India though being applicable w.e.f, 1st April, 2002, has
been considered by the Company while finalising the accounts. Accordingly,
the Company has recognised the impairment loss of Rs 8,348,726/- on the
value of fixed assets re, on leased land and plant & machinery including
furniture & fixture on the basis of sale offers received from the parties
and accepted by the management. Had this not been considered, the net loss
would have been lower by the above amount.
Subject to above in our opinion and to the best of our information and
according to the explanations given to us the Balance Sheet and Profit &
Loss Account read together with the notes thereon, give the, information as
required by the Companies Act, 1956 in the manner so required and give a
true and fair view:
a) In the case of Balance Sheet, the state of affairs of the Company as on
31st March 2007 and
b) In the case of Profit & Loss Account of the loss of the Company for the
year ended on that date.
6. As required by the Manufacturing and other Companies (Auditors) Report
Order, 1988, issued by tile Company Law Board in terms of under section
227(4A) of the Companies Act 1956, we further report that:
i. The Company has maintained proper records showing full particulars
including quantitative details of the fixed assets. As explained to us, all
the fixed assets have been physically verified by tire management during
the year according to the regular program 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.
ii. The Company's assets have been revalued during the year on the basis of
sale offer received from the parties and the impairment loss to fixed
assets has accordingly been reduced from the value of the fixed assets:
iii. There was no stock of stores. raw material, finished goods and spare
parts. Hence the clause (iii), (iv). (v), (vi) and (xii) relating to
MAOCAR0 are not applicable.
iv. The Company has not taken any loans secured or unsecured from the
Companies, firms or other parties listed in the register maintained under
Section 301 of the Companies Act, 1956, and from the Companies under the
same management as defined under sub-section (1B) of Section 370 of the
Companies Act, 1956.
v. The Company has not granted any loan secured or unsecured to the
Companies, of other parties listed in the register maintained under the sub
section (1B) of section 370 of the Companies Act, 1956.
vi. The Company has not given any loans or advances to the parties,
Companies and firms listed in the register maintained under section 301 of
the Companies Act, 1956, and from the companies under the same management
as defined under Sub-section (13) of section 370 of the Companies Act,
vii. In our opinion and according to information and explanation given to
us, there are adequate internal control procedures commensurate with the
size of the Company and nature of its business for sale of raw material
including components, stores, plants and machinery equipments.
viii. As informed to us the Company has not purchased ar sold goods and
materials aggregating to Rs.50,000/- or more to any party in pursuance of
contractor arrangement entered in the register maintained under section 301
of the Companies Act, 1956.
ix. During the year, the Company has not accepted any deposits from the
public covered under the provisions of Section 58A of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975.
x. The Company has no by-products and there is no sale of scrap.
xi. No Internal Audit has been done during the year.
xii. The Central Government has not prescribed the maintenance of cost
records by the Company under section 209(1)(d) of the Companies Act, 1956
or of its products.
xiii In view of closure of operation of the Company no Provident Fund and
Employees State Insurance have been deducted and deposited during the year
with the appropriate authorities.
xiv. According to the information and explanations given to us, there are
no undisputed amounts payable in respect of Income Tax, Wealth Tax. Sales
Tax, Customs Duty and Excise Duty which are outstanding as on 31st March,
2002 for a period of more than six months from the date they become
xv. On the basis of the examination of the books of accounts as carried out
and in accordance with the generally accepted auditing practices and
according to the information and explanations given to us, no personal
expenses of employees or Directors have been charged to these accounts
other than those payable under contractual obligations or in accordance
with the generally accepted business practices.
xvi. The Company is not a sick industrial Company within the meaning of
section (3)(1)(o) of the Sick Industrial Company (Special Provisions) Act,
For Krishna Sharma & Co.
Date : 20th June, 2002
For & on behalf of the Board of Directors
for KRISHNA SHARMA & CO.
DATE : 20.06.2002